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Pepsi Co Marketing from Scratch to 100
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Pepsi Co Marketing from Scratch to 100

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This document will help you in understanding the Marketing techniques and history of the Pepsi Co. From where Pepsi Co started and where they are standing today.

This document will help you in understanding the Marketing techniques and history of the Pepsi Co. From where Pepsi Co started and where they are standing today.

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    Pepsi Co Marketing from Scratch to 100 Pepsi Co Marketing from Scratch to 100 Document Transcript

    • Principles Of Marketing CASE STUDY ON THE PEPSI CO Muhammad Fahad Ali Mirza Waqar Liaqat Hannad Ahmad Muhammad Shakeel
    • 1 Table of Contents Origin:................................................................................................................................... 3 Co-operate Profile of Pepsi Co: .............................................................................................. 3 History: ................................................................................................................................. 3 Introduction:......................................................................................................................... 4 Rise:...................................................................................................................................... 5 Pepsi Cola Trademark:........................................................................................................... 5 Rivalry with Coke:.................................................................................................................. 6 Company Vision: ................................................................................................................... 8 Company Mission:................................................................................................................. 8 Performance with Purpose: ................................................................................................... 8 Company Strategies:.............................................................................................................. 8 SWOT Analysis of Pepsi Co: ................................................................................................ 9 Strengths:....................................................................................................................... 9 Weakness:...................................................................................................................... 9 Opportunity:................................................................................................................. 10 Threats:........................................................................................................................ 10 PEST Analysis of Pepsi Co: ................................................................................................ 10 Political Factors: ........................................................................................................... 10 Economical Factors:...................................................................................................... 11 Social Factors:............................................................................................................... 11 Technology Factors:...................................................................................................... 11 Marketing Strategies: .......................................................................................................... 11 Niche Marketing: ............................................................................................................. 12 Marketing:....................................................................................................................... 12 Marketing Mix of Pepsi: ................................................................................................... 15 Product ........................................................................................................................ 15 Price............................................................................................................................. 15 Place ............................................................................................................................ 16
    • 2 Promotion.................................................................................................................... 16 Pepsiman: ........................................................................................................................... 17 Financial Structure & Growth Rate:...................................................................................... 17 Pepsi Co Income Statement by 2012 NY times .................................................................. 17 Slogan of Pepsi:................................................................................................................... 19 Different Logos of Pepsi:...................................................................................................... 20 Different brands of Pepsi:.................................................................................................... 21 Analysis & Conclusion:......................................................................................................... 21 References: ......................................................................................................................... 21
    • 3 Marketing Case Study Pepsi Co Origin: Pepsi was first introduced as "Brad's Drink" in New Bern, North Carolina, United States, in 1898 by Caleb Bradham, who made it at his home where the drink was sold. It was later labeled Pepsi Cola, named after the digestive enzyme pepsin and kola nuts used in the recipe. Bradham sought to create a fountain drink that was delicious and would aid in digestion and boost energy. Co-operate Profile of Pepsi Co: PepsiCo is a world leader in convenient snacks, foods and beverages with revenues of more than $60 billion and over 285,000 employees. Take a journey through our past and see the key milestones that define PepsiCo. History: Born in the Carolinas in 1898, Pepsi-Cola has a long and rich history. The drink is the invention of Caleb Bradham, a pharmacist and drugstore owner in New Bern, North Carolina. The summer of 1898, as usual, was hot and humid in New Bern, North Carolina. So a young pharmacist named Caleb Bradham began experimenting with combinations of spices, juices, and syrups trying to create a refreshing new drink to serve his customers. He succeeded beyond all expectations because he invented the beverage known around the world as Pepsi-Cola. Caleb Bradham knew that to keep people returning to his pharmacy, he would have to turn it into a gathering place. He did so by concocting his own special beverage, a soft drink. His creation, a unique mixture of kola nut extract, vanilla and rare oils, became so popular his customers named it "Brad's Drink." Caleb decided to rename it "Pepsi-Cola," and advertised his new soft drink. People responded, and sales of Pepsi-Cola started to grow, convincing him that he should form a company to market the new beverage. In 1902, he launched the Pepsi-Cola Company in the back room of his pharmacy, and applied to the U.S. Patent Office for a trademark. At first, he mixed the syrup himself and sold it
    • 4 exclusively through soda fountains. But soon Caleb recognized that a greater opportunity existed to bottle Pepsi so that people could drink it anywhere. The business began to grow, and on June 16, 1903, "Pepsi-Cola" was officially registered with the U.S. Patent Office. That year, Caleb sold 7,968 gallons of syrup, using the theme line "Exhilarating, Invigorating, Aids Digestion." He also began awarding franchises to bottle Pepsi to independent investors, whose number grew from just two in 1905, in the cities of Charlotte and Durham, North Carolina, to 15 the following year, and 40 by 1907. By the end of 1910, there were Pepsi-Cola franchises in 24 states. Pepsi-Cola's first bottling line resulted from some less-than-sophisticated engineering in the back room of Caleb's pharmacy. Building a strong franchise system was one of Caleb's greatest achievements. Local Pepsi-Cola bottlers, entrepreneurial in spirit and dedicated to the product's success, provided a sturdy foundation. They were the cornerstone of the Pepsi-Cola enterprise. By 1907, the new company was selling more than 100,000 gallons of syrup per year. Growth was phenomenal, and in 1909 Caleb erected a headquarters so spectacular that the town of New Bern pictured it on a postcard. Famous racing car driver Barney Oldfield endorsed Pepsi in newspaper ads as "A bully drink...refreshing, invigorating, a fine bracer before a race." Introduction: Pepsi is a carbonated soft drink that is produced and manufactured by PepsiCo. Created and developed in 1898 and introduced as "Brad's Drink", it was later renamed as Pepsi-Cola on June 16, 1903, then to Pepsi in 1961. Pepsi's success under Guth came while the Loft Candy business was faltering. Since he had initially used Loft's finances and facilities to establish the new Pepsi success, the near-bankrupt Loft Company sued Guth for possession of the Pepsi-Cola company. A long legal battle, Guth v. Loft, then ensued, with the case reaching the Delaware Supreme Court and ultimately ending in a loss for Guth. Pepsi Cola is one of the largest soft drinks industries which operate in Australia. The main products of the company comprises of different soft drinks brand including Pepsi, Pepsi Light, Pepsi Max, 7UP, Diet 7UP, Caffeine Free Pepsi Light, Mountain Dew. In order to promote their Pepsi brand, the marketing division of the company has been able to utilize different marketing strategy in order to be competitive in the market place. The successful expansion to international markets when the U.S. market began to saturate (such as Japan and Eastern
    • 5 Europe) and marked the beginnings of their creative advertising campaigns with catchy slogans, celebrity endorsements and taste tests (such as with Mountain Dew and Pepsi Generation). Continuing its strategy to embark on complimentary businesses, PepsiCo also began acquiring quick fast-food restaurants and services such as Pizza Hut, Kentucky Fried Chicken and Taco Bell (all of which remain dominant in each respective market). These restaurants were also used as a means to capture customers into drinking PepsiCo’s beverages. Celebrities such as Michael Jackson, Ray Charles, Billy Crystal, Shaquille O’Neal, Andre Agassi and Madonna appeared in their many advertising campaigns, boosting sales. Accordingly, 60% of the marketing resources in Pepsi are used on advertising. The advertising and promotional tools used by the company include TV promotions with radio, magazine, cinema and outdoor support. Other promotional items include point of sale material, consumer premiums (e.g. clothing, caps, etc), and sporting and concert sponsorships. Although, these promotional tools that is use to promote the Pepsi brands can be considered as one of the strength of the company, the marketing department is still aware that they must used other promotional or communication tools to sustain their competitive position. In addition, the market nowadays has been greatly influenced by the modern technology such as the internet (1993). Rise: During the Great Depression, Pepsi gained popularity following the introduction in 1936 of a 12- ounce bottle. With a radio advertising campaign featuring the jingle "Pepsi-Cola hits the spot / Twelve full ounces, that's a lot / Twice as much for a nickel, too / Pepsi-Cola is the drink for you", arranged in such a way that the jingle never ends. Pepsi encouraged price-watching consumers to switch, obliquely referring to the Coca-Cola standard of six ounces per bottle for the price of five cents, instead of the 12 ounces Pepsi sold at the same price. Coming at a time of economic crisis, the campaign succeeded in boosting Pepsi's status. From 1936 to 1938, Pepsi-Cola's profits doubled. Pepsi Cola Trademark: The original trademark application for Pepsi-Cola was filed on September 23, 1902 with registration approved on June 16, 1903. In the application's statement, Caleb Bradham describes the trademark as an "arbitrary hyphenated word "PEPSI-COLA", and indicated that the mark was in continuous use for his business since August 1, 1901. The Pepsi-Cola's description is a flavoring-syrup for soda water. The trademark expired on April 15, 1994.
    • 6 A second Pepsi-Cola trademark is on record with the USPTO. The application date submitted by Caleb Bradham for the second trademark is Saturday, April 15, 1905 with the successful registration date of April 15, 1906, over three years after the original date. Curiously, in this application, Caleb Bradham states that the trademark had been continuously used in his business "and those from whom title is derived since in the 1905 application the description submitted to the USPTO was for a tonic beverage. The federal status for the 1905 trademark is registered and renewed and is owned by PepsiCo, Inc. of Purchase, New York. Rivalry with Coke: According to Consumer Reports, in the 1970s, the rivalry continued to heat up the market. Pepsi conducted blind taste tests in stores, in what was called the "Pepsi Challenge". These tests suggested that more consumers preferred the taste of Pepsi (which is believed to have more lemon oil, and less orange oil, and uses vanillin rather than vanilla) to Coke. The sales of Pepsi started to climb, and Pepsi kicked off the "Challenge" across the nation. This became known as the "Cola Wars". In 1985, The Coca-Cola Company, amid much publicity, changed its formula. The theory has been advanced that New Coke, as the reformulated drink came to be known, was invented specifically in response to the Pepsi Challenge. However, a consumer backlash led to Coca-Cola quickly reintroducing the original formula as Coke "Classic". According to Beverage Digest's 2008 report on carbonated soft drinks, PepsiCo's U.S. market share is 30.8 percent, while The Coca-Cola Company's is 42.7 percent. Coca-Cola outsells Pepsi in most parts of the U.S., notable exceptions being central Appalachia, North Dakota, and Utah. In the city of Buffalo, New York, Pepsi outsells Coca-Cola by a two-to-one margin. Overall, Coca-Cola continues to outsell Pepsi in almost all areas of the world. However, exceptions include Oman; India; Saudi Arabia; Pakistan (Pepsi has been a dominant sponsor of the Pakistan cricket team since the 1990s); the Dominican Republic; Guatemala the Canadian provinces of Quebec, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island; and Northern Ontario. Pepsi had long been the drink of Canadian Francophone and it continues to hold its dominance by relying on local Québécois celebrities (especially Claude Meunier, of La Petite Vie fame) to sell its product. PepsiCo used the slogan "here, it's Pepsi" (Ici, c'est Pepsi) to answer to Coca- Cola publicity "Everywhere in the world, it's Coke" (Partout dans le monde, c'est Coke).
    • 7 By most accounts, Coca-Cola was India's leading soft drink until 1977 when it left India after a new government ordered The Coca-Cola Company to turn over its secret formula for Coke and dilute its stake in its Indian unit as required by the Foreign Exchange Regulation Act (FERA). In 1988, PepsiCo gained entry to India by creating a joint venture with the Punjab government- owned Punjab Agro Industrial Corporation (PAIC) and Voltas India Limited. This joint venture marketed and sold Lehar Pepsi until 1991 when the use of foreign brands was allowed; PepsiCo bought out its partners and ended the joint venture in 1994. In 1993, The Coca-Cola Company returned in pursuance of India's Liberalization policy. In 2005, The Coca-Cola Company and PepsiCo together held 95% market share of soft-drink sales in India. Coca-Cola India's market share was 52.5%. In Russia, Pepsi initially had a larger market share than Coke but it was undercut once the Cold War ended. In 1972, PepsiCo company struck a barter agreement with the then government of the Soviet Union, in which PepsiCo was granted exportation and Western marketing rights to Stolichnaya vodka in exchange for importation and Soviet marketing of Pepsi-Cola. This exchange led to Pepsi-Cola being the first foreign product sanctioned for sale in the U.S.S.R. Reminiscent of the way that Coca-Cola became a cultural icon and its global spread spawned words like "coca colonization", Pepsi-Cola and its relation to the Soviet system turned it into an icon. In the early 1990s, the term "Pepsi-stroika" began appearing as a pun on "perestroika", the reform policy of the Soviet Union under Mikhail Gorbachev. Critics viewed the policy as a lot of fizz without substance and as an attempt to usher in Western products in deals there with the old elites. Pepsi, as one of the first American products in the Soviet Union, became a symbol of that relationship and the Soviet policy. This was reflected in Russian author Victor Pelevin's book "Generation P". In 1989, Billy Joel mentioned the rivalry between the two companies in the song "We Didn’t Start the Fire". The line "Rock & Roll and Cola Wars" refers to Pepsi and Coke's usage of various musicians in advertising campaigns. Coke used Paula Abdul, while Pepsi used Michael Jackson. Both companies then competed to get other musicians to advertise its beverages. In 1992, following the dissolution of the Soviet Union, Coca-Cola was introduced to the Russian market. As it came to be associated with the new system and Pepsi to the old, Coca-Cola rapidly captured a significant market share that might otherwise have required years to achieve. By July 2005, Coca-Cola enjoyed a market share of 19.4 percent, followed by Pepsi with 13 percent. Pepsi did not sell soft drinks in Israel until 1991. Many Israelis and some American Jewish organizations attributed Pepsi's previous reluctance to do battle to the Arab boycott. Pepsi,
    • 8 which has a large and lucrative business in the Arab world, denied that, saying that economic, rather than political, reasons kept it out of Israel. Company Vision: "PepsiCo's responsibility is to continually improve all aspects of the world in which we operate - environment, social, economic - creating a better tomorrow than today." Our vision is put into action through programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company. Company Mission: The company’s mission is “To be the world’s premier consumer Products Company focused on convenient foods and beverages.” Pepsi Co. continuously searches for strong financial returns to shareholders as they give prospects for development and enhancement to their workers, and the organizations inside the industry. Performance with Purpose: At PepsiCo, we're committed to achieving business and financial success while leaving a positive imprint on society - delivering what we call Performance with Purpose. Our approach to superior financial performance is straightforward - drive shareholder value. By addressing social and environmental issues, we also deliver on our purpose agenda, which consists of human, environmental, and talent sustainability. Company Strategies: Through Diversification, PepsiCo is able to cover all food and beverage alternatives. Its beverages alone are not limited to carbonated drinks but also, ready to drink teas, orange and fruit juices, mineral water and through the recent acquisition of Quaker Oats, isotonic drinks. Once, it had only catered to salty snack foods, but today, it also caters to sweet snack foods through ready to eat popcorn and healthy alternatives through Quaker Oats. This provides a wide variation of choices for consumers who may opt for a tasty food or healthy food lifestyle. PepsiCo also includes the quick fast food restaurants business in the synergy mix. Through its three leading fast food restaurants, Pizza Hut, KFC and Taco bell, PepsiCo can distribute its
    • 9 beverages through a captive customer market that would entail of their beverages through fountain drinks. A well-known synergy maneuver by PepsiCo is through the “Power of One” strategy where PepsiCo urges supermarket outlets to put PepsiCo’s beverages and salty foods side by side through the premise that snack foods and soft drinks come together. Through the “Power of One” strategy, PepsiCo is able to ensure that these snack foods and soft drinks that consumers will buy are all PepsiCo’s. It will also lead for consumers of snack foods to try out PepsiCo’s beverages that are just conveniently placed besides the snack foods display and vice versa. PepsiCo’s aim towards synergy maintains its hold in three dominant industries while upon allowing each industry to benefit with each other. It is able to create one strong cohesive food empire with companies that are complimentary, beneficial, and not to mention, urged to interact with one another. This has led PepsiCo to have a tremendously impressive sales track record and a strong dominating performance as it earns hundreds of millions of dollars daily with its three industries. As it continues to expand and innovate, there is no wonder that PepsiCo could achieve and grow more. SWOT Analysis of Pepsi Co: To analyze the strategy of PepsiCo at hand, the paper will delve into the SWOT Analysis which will assist in the determining and evaluation of the strategy’s workability. Strengths: PepsiCo dominates the competition through their three industries and brands. Frito Lay alone is a world leader, the benchmark no less of snack chip industry. Their annual sales, through their acquisition and product expansions, constantly increase. The acquisition of potential market leader companies continues to strengthen and empower PepsiCo. Besides its huge diversity of food, beverage and quick fast food businesses, PepsiCo employs an impressive synergy plan that attempts to consolidate all of its businesses. From its practice of transferring its best managers to its many different companies to its “Power of One“ Strategy, PepsiCo is able to tie its companies together and allow each company to benefit others and vice versa through a continuous sharing of knowledge, skills and practices. Weakness: Coca Cola remains to dominate the carbonated cola drinks market with Pepsi Cola far behind. Pepsi Cola remains one of PepsiCo’s weaknesses since it lags far behind Coca Cola in the international market. Prices also continue to increase for raw materials especially fuel and cooking oil which PepsiCo will be dependent of. PepsiCo is strapped down to its chair and
    • 10 would not be able to command a price increase as they survive in an intensely competitive environment. Opportunity: PepsiCo’s direct store distribution provides them tremendous business control to delivering directly straight to the retailers’ shelves. How they control the product display and appearances in the super market provide them a wide range of selling opportunities, allowing them to enact the “Power of One” strategy and granting more profitability and salability. This move is also a cost saving method in the part of PepsiCo. The increasing concern for healthy foods supportive of diet and wellness will open a new door of opportunity for PepsiCo. The acquisition of Aquafina, Tropicana and Quaker Oats is already a significant positive step towards the consideration of a healthier food and beverage alternative. The awareness does not limit itself to these products and in fact, as if in a synergistic dedication, PepsiCo has also begun releasing low fat versions of their famous snack foods through Baked Lays, Diet Pepsi and Mountain Dew asides from fruit juices and oatmeal. PepsiCo’s continuing diversity will provide the much needed back-up for the company and allow it to rely on other companies and businesses than just a sole powerful brand. While it remains true that Coca Cola is a threat and weakness for PepsiCo, its non-carbonated drink sectors prove to be the most coveted asset. Threats: PepsiCo must be aware that its products are reliant on customers, and thus in turn, their lifestyles. Any changes in their way of life, will greatly affect how they will buy their products. They need to be able to present alternatives that will cover all food and beverage choices in order to remain stable while customers change their tastes, trends and fashion, thus opting for a different snack and drink (or opt not to buy them due to health concerns.) Thus it remains to be PepsiCo’s opportunity to expand to nutritional snacks and drinks as brought by the acquisition of Quaker Oats and Gatorade. PepsiCo must continue surveying the possible substitutes that people will go for as they change their tastes. PEST Analysis of Pepsi Co: Political Factors:  PepsiCo products are subject to various federal laws.  Land acquisition for new factories.  Govt. focusing on stricter water pollution norms.  Raw Material prices A great worry.
    • 11 Economical Factors:  New opportunities in other countries.  Fuel prices.  Availability of Labour.  Have a global Prospect. Social Factors:  Impact on youngsters.  Solid waste management program.  Partnership with farmers.  Replenishing water. Technology Factors:  State of Arts plant.  Latest Designs.  Induction of cans and plastic bottles.  Operates in almost all the countries. Marketing Strategies: To this day a new era in marketing and promotions has surfaced in our generation. Many marketers have set aside traditional approaches and have come to embrace fresh perspectives in promoting their products to their customers. To this day, marketing has transcended from being an expense to being an investment; from being product oriented to becoming customer oriented. Marketing and advertising has become an investment because of the profitable results that are likely to emerge upon implementation of such strategies. Moreover, instead of focusing on product attributes, marketers have realized that it is the customer who should be the essential focus of every marketing strategy since it is the customer who is the recipient and the ultimate evaluator of the products and services the company provides. One of the approaches used with different organizations is the use of Integrated Marketing Communication (IMC). Hence, the main goal of this paper is to provide a critical analysis of the Integrated Marketing Communications relating to the products Pepsi Cola, specifically its Pepsi brand. This paper will provide insightful details regarding IMC and the tools that can be used by the marketer to promote their product portfolios. In addition, this paper will discuss the advantages and disadvantages of the IMC tools.
    • 12 Niche Marketing: Walter Mack was named the new President of Pepsi-Cola and guided the company through the 1940s. Mack, who supported progressive causes, noticed that the company's strategy of using advertising for a general audience either ignored African Americans or used ethnic stereotypes in portraying blacks. He realized African Americans were an untapped niche market and that Pepsi stood to gain market share by targeting its advertising directly towards them. To this end, he hired Hennan Smith, an advertising executive "from the Negro newspaper field" to lead an all-black sales team, which had to be cut due to the onset of World War II. In 1947, Mack resumed his efforts, hiring Edward F. Boyd to lead a twelve-man team. They came up with advertising portraying black Americans in a positive light, such as one with a smiling mother holding a six pack of Pepsi while her son (a young Ron Brown, who grew up to be Secretary of Commerce) reaches up for one. Another ad campaign, titled "Leaders in Their Fields", profiled twenty prominent African Americans such as Nobel Peace Prize winner Ralph Bunche and photographer Gordon Parks. Boyd also led a sales team composed entirely of blacks around the country to promote Pepsi. Racial segregation and Jim Crow laws were still in place throughout much of the U.S.; Boyd's team faced a great deal of discrimination as a result, from insults by Pepsi co-workers to threats by the Ku Klux Klan. On the other hand, it was able to use racism as a selling point, attacking Coke's reluctance to hire blacks and support by the chairman of Coke for segregationist Governor of Georgia Herman Talmadge. As a result, Pepsi's market share as compared to Coke's shot up dramatically. After the sales team visited Chicago, Pepsi's share in the city overtook that of Coke for the first time. This focus on the market for black people caused some consternation within the company and among its affiliates. It did not want to seem focused on black customers for fear white customers would be pushed away. In a meeting at the Waldorf-Astoria Hotel, Mack tried to assuage the 500 bottlers in attendance by pandering to them, saying: "We don't want it to become known as a nigger drink." After Mack left the company in 1950, support for the black sales team faded and it was cut. Marketing: From the 1930s through the late 1950s, "Pepsi-Cola Hits the Spot" was the most commonly used slogan in the days of old radio, classic motion pictures, and later television. Its jingle (conceived in the days when Pepsi cost only five cents) was used in many different forms with different lyrics. With the rise of radio, Pepsi utilized the services of a young, up-and-coming actress named Polly Bergen to promote products, oftentimes lending her singing talents to the classic "...Hits The Spot" jingle.
    • 13 Film actress Joan Crawford, after marrying then Pepsi-Cola President Alfred N. Steele became a spokesperson for Pepsi, appearing in commercials, television specials and televised beauty pageants on behalf of the company. Crawford also had images of the soft drink placed prominently in several of her later films. When Steele died in 1959 Crawford was appointed to the Board of Directors of Pepsi-Cola, a position she held until 1973, although she was not a board member of the larger PepsiCo, created in 1965. Through the intervening decades, there have been many different Pepsi theme songs sung on television by a variety of artists, from Joanie Summers to the Jacksons to Britney Spears. In 1975, Pepsi introduced the Pepsi Challenge marketing campaign where PepsiCo set up a blind tasting between Pepsi-Cola and rival Coca-Cola. During these blind taste tests the majority of participants picked Pepsi as the better tasting of the two soft drinks. PepsiCo took great advantage of the campaign with television commercials reporting the results to the public. In 1976 Pepsi, RKO Bottlers in Toledo, Ohio hired the first female Pepsi salesperson, Denise Muck, to coincide with the United States bicentennial celebration. In 1996, PepsiCo launched the highly successful Pepsi Stuff marketing strategy. By 2002, the strategy was cited by Promo Magazine as one of 16 "Ageless Wonders" that "helped redefine promotion marketing". In 2007, PepsiCo redesigned its cans for the fourteenth time, and for the first time, included more than thirty different backgrounds on each can, introducing a new background every three weeks. One of its background designs includes a string of repetitive numbers, "73774". This is a numerical expression from a telephone keypad of the word "Pepsi". In late 2008, Pepsi overhauled its entire brand, simultaneously introducing a new logo and a minimalist label design. The redesign was comparable to Coca-Cola's earlier simplification of its can and bottle designs. Pepsi also teamed up with YouTube to produce its first daily entertainment show called Popup. This show deals with pop culture, internet viral videos, and celebrity gossip. In 2009, "Bring Home the Cup" changed to "Team Up and Bring Home the Cup". The new installment of the campaign asks for team involvement and an advocate to submit content on behalf of their team for the chance to have the Stanley Cup delivered to the team's hometown by Mark Messier. Pepsi has official sponsorship deals with three of the four major North American professional sports leagues: the National Football League, National Hockey League and Major League
    • 14 Baseball. Pepsi also sponsors Major League Soccer. It also has the naming rights to the Pepsi Center, an indoor sports facility in Denver, Colorado. Pepsi also has sponsorship deals in international cricket teams. The Pakistan cricket team is one of the teams that the brand sponsors. The team wears the Pepsi logo on the front of their test and ODI test match clothing. In July 2009, Pepsi started marketing itself as Pepsi in Argentina in response to its name being mispronounced by 25% of the population and as a way to connect more with all of the population. In October 2008, Pepsi announced that it would be redesigning its logo and re-branding many of its products by early 2009. In 2009, Pepsi, Diet Pepsi and Pepsi Max began using all lower- case fonts for name brands, and Diet Pepsi Max was re-branded as Pepsi Max. The brand's blue and red globe trademark became a series of "smiles", with the central white band arcing at different angles depending on the product until 2010. Pepsi released this logo in U.S. in late 2008, and later it was released in 2009 in Canada (the first country outside of the United States for Pepsi's new logo), Brazil, Bolivia, Guatemala, Nicaragua, Honduras, El Salvador, Colombia, Argentina, Puerto Rico, Costa Rica, Panama, Chile, Dominican Republic, the Philippines and Australia. In the rest of the world the new logo has been released in 2010. The old logo is still used in several markets internationally, and has been phased out most recently in France and Mexico. The UK started to use the new Pepsi logo on cans in an order different from the US can. In mid-2010, all Pepsi variants, regular, diet, and Pepsi Max, have started using only the medium-sized "smile" Pepsi Globe. Pepsi and Pepsi Max cans and bottles in Australia now carry the localized version of the new Pepsi Logo. The word Pepsi and the logo are in the new style, while the word "Max" is still in the previous style. Pepsi Wild Cherry finally received the 2008 Pepsi design in March 2010. In 2011, for New York Fashion Week, Diet Pepsi introduced a "skinny" can that is taller and has been described as a "sassier" version of the traditional can that Pepsi says was made in "celebration of beautiful, confident women". The company's equating of "skinny" and "beautiful" and "confident" is drawing criticism from brand critics, consumers who do not back the "skinny is better" ethos, and the National Eating Disorders Association, which said that it takes offense to the can and the company's "thoughtless and irresponsible" comments. PepsiCo Inc. is a Fashion Week sponsor. This new can was made available to consumers nationwide in March. In April 2011, Pepsi announced that customers will be able to buy a complete stranger a soda at a new "social" vending machine, and even record a video that the stranger would see when they pick up the gift.
    • 15 In May 2011, the week before Memorial Day, Pepsi launched a limited edition flavor called "Memorial Day Pepsi", with blueberry and cherry flavors added to the cola. In March 2012, Pepsi introduced Pepsi Next, a cola with half the calories of regular Pepsi. Marketing Mix of Pepsi: PepsiCo is one of the world's largest food and beverage companies, with 2007 annual revenues of more than $60 billion. The company employs approximately 285,000 people worldwide, and its products are sold in approximately 200 countries through four P's of the Marketing Mix which are following. 1. Product 2. Promotion 3. Place 4. Price Product  Beverage Products – Diet Pepsi, Gatorade, Mountain Dew, Thirst Quencher, Tropicana, Aquafina Bottled Water, Sierra Mist.  Savory Food Snacks – Fritos Corn chips, Cheetos, Lays, Tostitos, Doritos.  Other Food Products – breakfast cereals, cakes and cake mixes.  PepsiCo recently created Baked Snacks North America Business Unit to meet consumer’s interest in more nutritious snacks and foods. Price  Expenses related to transportation, ingredients and labor continue to pressure the beverage industry toward price increases.  PepsiCo’s drink pricing strategies may be heavily influence by its working relationship with Wal-Mart whose low price themes put pressure on PepsiCo to hold down prices.  The company strives to cut or maintain current prices by cutting overhead and reengineering the manufacturing process.
    • 16  PepsiCo is expanding its use of inexpensive and recyclable plastic bottles; nevertheless the company has instituted some price increases in recent years, specifically in its overseas markets such as New Delhi and Dubai. Place  PepsiCo is primarily a US based co. with approximately 52% of its revenues located in the states.  PepsiCo is in the midst of making a $1,000 million investment in China, and a $500 million investment in India. Both initiatives are part of its expansion into international markets and a lessening of its dependence on US sales.  In addition the company plans on major capital initiatives in Brazil and Mexico.  The company is also acquiring Russia’s leading Juice Company, Lebedyansky, and V Water located in the UK. Promotion  Indra K. Nooyi is the President of PepsiCo in addition to the company’s CFO  Recently the board of Directors elected Steven S Reinemund chairman of the board and chief executive officer.  PepsiCo fosters a corporate culture that values employees and emphasized diversity in the workplace.  PepsiCo is named to the ‘Best Companies for Multi-Cultural Women’ list by Working Mother magazine.  PepsiCo is recognized at two events for its dedication to Talent Sustainability and dedication to Asian American employees-2009 Best companies for Asian Pacific Americans from Asian Entrepreneur, Top 10 Companies for Asian Americans from AMBA.  PepsiCo has won the ‘Workplace Excellence’ Award at Out & Equal Workplace National Summit. PepsiCo is listed in the top 20 ‘Ideal Employer MBA Ranking’ in Fortune magazine
    • 17 Pepsiman: Pepsiman is an official Pepsi mascot from Pepsi's Japanese corporate branch. The design of the Pepsiman character is attributed to Canadian comic book artist Travis Charest created sometime around the mid-1990s. Pepsiman took on three different outfits; each one representing the current style of the Pepsi can in distribution. Twelve commercials were created featuring the character. His role in the advertisements is to appear with Pepsi to thirsty people or people craving soda. Pepsiman happens to appear at just the right time with the product. After delivering the beverage, sometimes Pepsiman would encounter a difficult and action oriented situation which would result in injury. In 1996, Sega-AM2 released the Sega Saturn version of its arcade fighting game Fighting Vipers. In this game Pepsiman was included as a special character, with his specialty listed as being the ability to "quench one's thirst". He does not appear in any other version or sequel. In 1999, KID developed a video game for the PlayStation entitled Pepsiman. As the titular character, the player runs, skateboards, rolls, and stumbles through various areas, avoiding dangers and collecting cans of Pepsi all while trying to reach a thirsty person as in the commercials Financial Structure & Growth Rate: Nonalcoholic beverages encompass 87% of the total U.S. beverage market. Inside that 87%, carbonated soft drinks include 28% of the market. Followed by bottled water, milk and coffee with about 12% each, in 2004, the market shares of Pepsi Co. and Coca Cola dropped, while the shares of Cadbury Schweppes and Cott Corporation are increased. Note that the beverage industry has now extended throughout the world, originating in the United States; beverages are often considered as a characteristic of the new global culture. These fast food restaurants are illustrated as informal, have uniform service to anyone regardless of social status and focuses on giving quick-service to its customers. The industry grew out of a cultural philosophy that greatly values friendliness more than propriety, basically more than traditions of gracious living and democratic consensus over status-based divisions. Pepsi Co Income Statement by 2012 NY times Period Ending Dec 30, 2011 Dec 24, 2010 Dec 25, 2009 Total Revenue 66,504,000 57,838,000 43,232,000
    • 18 Cost of Revenue 31,593,000 26,575,000 20,099,000 Gross Profit 34,911,000 31,263,000 23,133,000 Operating Expenses Research Development - - - Selling General and Administrative 25,145,000 22,814,000 15,026,000 Non Recurring - - - Others 133,000 117,000 63,000 Total Operating Expenses - - - Operating Income or Loss 9,633,000 8,332,000 8,044,000 Income from Continuing Operations Total Other Income/Expenses Net 57,000 68,000 67,000 Earnings Before Interest And Taxes 9,690,000 9,135,000 8,476,000 Interest Expense 856,000 903,000 397,000 Income Before Tax 8,834,000 8,232,000 8,079,000 Income Tax Expense 2,372,000 1,894,000 2,100,000 Minority Interest (19,000) (18,000) (33,000) Net Income From Continuing Ops 6,443,000 7,055,000 6,311,000 Non-recurring Events Discontinued Operations - - -
    • 19 Extraordinary Items - - - Effect Of Accounting Changes - - - Other Items - - - Net Income 6,443,000 6,320,000 5,946,000 Preferred Stock And Other Adjustments - - - Net Income Applicable To Common Shares 6,443,000 6,320,000 5,946,000 Slogan of Pepsi:  1999–2000: "For Those Who Think Young"/"The Joy of Pepsi-Cola" (commercial with Britney Spears/commercial with Mary J. Blige)  1999–2006: "Yeh Dil Maange More!" (Hindi – meaning "This heart asks for more") (India)  2002: "Change the World" (Japan)  2003: "Its the Cola"/"Dare for More" (Pepsi Commercial)  2006–2007: "Why You Doggin' Me"/"Taste the one that's forever young" (Mary J. Blige)  2007–2008: "More Happy"/"Taste the once that's forever young" (Michael Alexander)  2000–present: "Pepsi ye pyaas heh bari" ((Urdu) meaning "There is a lot of thirst" (Pakistan))  2008: "Pepsi Stuff" Super Bowl Commercial (Justin Timberlake)  2008–present: "Something For Everyone"  2009–present: "Refresh Everything"/"Every Generation Refreshes the World"  2009–present: "Yeh hai youngistaan meri jaan" (Hindi – meaning "This is our young country my baby")  2009–present: "My Pepsi My Way"(Pakistan)  2009: "Joy It Forward" (Canada)  2010–present: "Every Pepsi Refreshes The World"  2010–present "Pepsi. Sarap Magbago." (Philippines – meaning "Its nice to change")  2010–2011 "Badal Do Zamana" (Urdu – meaning "Change The World" by CALL)(Pakistan)
    • 20  2010–2011 "Love!" (Japan, for Pepsi Nex)  2010–present: "Pode ser bom, pode ser muito bom, pode ser Pepsi" (Can be good, can be very good, can be Pepsi) – Brazil  2011–present: "Change the game" (India, Bangladesh & Pakistan for the 2011 Cricket World Cup)  2011–present "Dunya Hai Dil Walon Ki" (Pakistan-meaning World is For Lovers by Ali Zafar)  2011–present "Ici, c'est Pepsi" (Québec-meaning Here, it's pepsi)  2011–present "Go Next!" (Japan, for Pepsi Nex)  2011–present "Summer Time is Pepsi Time"  2011–present "Born in the Carolinas"  2012: "Where there's Pepsi, there's music" – used for the 2012 Super Bowl commercial featuring Melanie Amaro  2012 "Live For Now" Different Logos of Pepsi:
    • 21 Different brands of Pepsi:  Pepsi Cola Brand.  Frito-lays brand.  Tropicana Brand.  Gatorade Brand.  Quaker Brand. Analysis & Conclusion: PepsiCo is a truly dominant company with three mega industries and brands famous and embraced all over the world. With its strategies of diversification and synergy, it is able to expand its product portfolio through hybrid distribution systems with a lesser cost. But all companies fall prey to their large sizes and PepsiCo must be able to continue to steer their company in a single direction, while being supported by all of its companies and not just a single driving company like Frito-Lay. At the end of the day, PepsiCo’s main enemies are the global changes it must learn to adjust to. This includes the continuous health concern brought by degradation brought by fatty and salty foods and the constant depletion of resources such as oil, fuel and fruits brought by weather changes, thus pushing PepsiCo to increase its prices, but with its highly elastic demand, PepsiCo must take extra care before they would lose their customers due to the slightest price increase in a highly competitive environment. References: 1. Pepsi.inc.co 2. Wikipedia.org 3. Google.com