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pepsi killing softly
 

pepsi killing softly

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how pepsi entered indian market and problem itfaced by

how pepsi entered indian market and problem itfaced by

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    pepsi killing softly pepsi killing softly Presentation Transcript

    • Faculty : Dr. Archi Mathur
      Killing Softly
      Group Members :
      Harish Choudhary
      Preeti Nayak
      Priyanka Agnani
      Neeraj Paliwal
      Roll No-244,246,247,252
      CASE STUDY
    • Facts of the case
      Facts of case
    • THE INTERNATIONAL SCENARIO:
      • Rivalry between Coke and Pepsi and each trying to beat the other.
      • Coke outsells Pepsi.
      • In 1987 Coke & Pepsi have 40.3% & 30.2 % of the U.S market respectively.
      • Apart from Pepsi cola co. and Pepsi cola International, it had six other divisions.
      Pepsi was merged with Frito-Lay to constitute Pepsi co. International in 1965.
      Pepsi became the owner of the world’s largest restaurant chain which also includes Pizza hut and Tacco Bell with a total of nearly 16500 outlets in 1987.
      Pepsi had so far made inroads in 151 countries – 150 before India.
    • THE INDIAN SCENARIO:
      Limca was the largest selling brand, cola was the largest selling flavor .
      • In 1977 a change in government at a centre led to the exit of the Coca cola.
      • The first national cola drink to pop up was Double Seven.
      • In 1980 another cola drink, Thumps Up was launched by Parle .
      • Thrill by Mc Dowell's in mid eighties and by the late eighties there was Double cola .
      • The Indian soft drink industry was estimated to be 900 crores.
      • An additional dimension to the Indian soft drinks was fruit drinks
    • Pepsi in India
      • In 1985 a proposal with R.P. Goenka group was rejected by the then govt.
      • The proposal involved:
      • Export of fruit juice concentrates from Punjab in return for the import of cola concentrates.
      • The deal offered was 3:1 export import ratio.
      • Therefore second bid was widened to take in a food processing division.
      • Acceptance of the Pepsi Offer in India in 1990:
      • Export import ratio was finally fixed at 5:1
      • Cold drinks sale was fixed at 22.5% of total sales
    • Issue 1 : What were the elements of Indian market environment that Pepsi co. had to tackle? Elements of Micro Environment
    • COMPETITORS
    • Collabration
    • Suppliers
    • Customer
    • Macro environment
      • Political environment
      • Legal Environment
      • Economic Environment
      • Social Environment
      • Technological Environment
    • 1-Political Environment
    • 2-Legal environment
      Severe restrictions in equity .
      To show the results without the soft drink component.
      Closed economy
      3-Economic environment
      Cold drink industry was in nascent stage
      Foreign Exchange problem.
      Lack of adequate market for fruits cultivators
    • 4-Technological environment
    • 5-Social environment
    • Issue-2-How were these elements managed ?
      MICRO ENVIRONMENT.
      Competitors
      Partners / Collaborations
      Suppliers
      Customers
      MACRO ENVIRONMENT.
      Political
      Legal
      Economic
      Technological
      Social
    • A-Competitors
    • B-Partners /Collaboration
    • C-Suppliers
    • D-Customers
    • Political
      • Food processing was included in second proposal
      • Assurance on meeting export regulations
      • Employment -500-direct and 30000-additional were assured
      • In the revised deal
      • Equity stakes were revised
      • PAIC 40% Voltas -24% ,Pepsi-35%
      • EXIM ratio fixed at 5%
      • Indulged in political lobbying
      • Ensured the active participation of Punjab government.
    • Economic
    • -Technological
      • Assured availability of high end technology
      • Established collaborations for development of agriculture
      • LEGAL
      • Social
      • Ensured Indianization through Indian version of Pepsi
      Compliance with legal requirements
      Fighting out the cases inside as well as outside.
    • Issue-3-what is your learning about “managing the environment”?
      IDENTIFICATION
      APPRAISAL
      ANALYSIS
    • Flexibility –in changing offers .
      Operating on strength
      Brand name
      Soft drink.
      Going beyond requirement making it look like an initiative.
    • Issue-4-How do you see the emerging environment in the Indian soft drinks market ?
      Production
      Market
      Competition
      Promotion
    • Production
      Better & more efficient means of production
      Introduction of variety of flavours
      More choices available to the buyers in terms of prodcuts, brands & flovors
    • Market
      Growth in market size
      Spread of market of Pepsi
      Probable entry of Pepsi in fruit drinks
    • Competition
      Increase in the degree of competition
      Probable exit of Pure Drinks
      Consolidation of small players
      Incoming of more foreign players especially Coke
    • Promotion
      Exposure to new forms of strategies & techniques
      Increase in the budgetary allocation to advertisement & sales promotion
      More aggressive form of promotion to be observed in the market
    • THANK YOU