This document discusses PepsiCo, a multinational food and beverage corporation. It was formed in 1965 through the merger of Pepsi-Cola and Frito-Lay, and has since grown through acquisitions of other brands. PepsiCo now captures markets in over 200 countries. The document discusses PepsiCo's product diversification beyond soft drinks into snacks and other beverages. It also analyzes PepsiCo's pricing, distribution, promotion strategies as well as its competitors and strengths.

2. • An American multinational food and beverage corporation
formed in 1965 headquartered in Purchase, New York.
• Merger of the Pepsi-Cola Company and Frito-Lay, Inc. ,an
acquisition of Tropicana in 1998 and a merger with Quaker
Oats in 2001.
•Capturing the market of more than 200 countries.
About PepsiCo

3. Product Diversification(PepsiCo)

4. •The drink Pepsi was first introduced as "Brad's Drink" in
New Bern, North Carolina, United States.
•Renamed Pepsi Cola in 1898, named after the digestive
enzyme pepsin and kola nuts used in the recipe.
• The original recipe also included sugar and vanilla.
Bradham sought to create a fountain drink that was
appealing and would aid in digestion and boost energy.
Analysis of Product (Pepsi)

5. Product Diversification(Pepsi)
Products have kept on increasing the
Product line such as:
1. Pepsi
2. Pepsi light
3. 7up
4. Miranda
5. Gatorade
6. Rock Star
7. Lipton Ice Tea

6. •Pricing is based on consumer’s perception of value and are market determined as consumer perceive
that the basic price they pay for brands like Pepsi is justified as it is more about refreshing Cola
experience rather than just a thirst quencher.
• Competitively priced because carbonated soft drink market at its full matured stage.
• Employing a combined offerings of its beverages and consumer product making a win -win situation for
both retailers and company itself.
• By expanding its use of inexpensive and recyclable plastic bottles.
Pricing Strategy

7. Place (Distribution)

8. • Pepsi makes sure that the
advertisements reflect the
target audience’s interests
and nostalgia.
• The advertising strategy
includes cool, hip promos to
attract more of the target
audience.
• There are several types of
advertisements that is used by
Pepsi that help expose the
product out to the public.
Examples are print
advertisement, outdoor
advertisement and broadcast
advertisement.
PROMOTION

11. Using 5 C’s analysis to assess the situation
Customer
Context
Company
Collaborators/Complements
Competitors

12. Customer
Customers include:-
• authorized bottlers
• independent distributors, including foodservice distributors
• retailers.

13. i. Demographic environment.
ii. Economic environment
iii. Socio-cultural environment
iv.Political/Legal environment
v. Technological environment
vi.Natural Environment
Analysing the context

14. Demographic environment. (India)
Age: Pepsi has targeted the particular age group of people from 10-35 in India, from schools to offices
it has achieved a complete analysis to whom should the product be sold.
Social class: With the help of smart pricing it has majorly covered the upper class, middle class and
the upper lower class community.
Educational levels: Customer awareness is one of the major tasks taken up by Pepsi constantly updating
with its innovation and mention the descriptive details on its beverages it has gained trust from its customers
now from years
Forex: if Delhi is facing winters it will start promoting inn the regions such as Mumbai.
Population density: With the population of almost 1.3 billion people it has no issue in selling products across
India. The census is well studied according to demographic and geographic analysis.

15. Economic environment. (India)
Income: This plays a very vital role as the pricing has been done in such a manner that it fits well
With many brackets of income.
Consumption behaviour: The more the income the more is the marginal utility to be satisfied,
taking this under consideration Pepsi prices its product. As India is more of consumption oriented
Society and is easily attracted by demonstrations the market base of Pepsi has exponentially
increased.
Aggregate demand: In case of Pepsi, demand of the product increases in the season of
summer as the hot weather makes the consumer wants to drink more.
Aggregate supply: In summer season to cope up with the increasing demand they have
to increase the aggregate supply of their product.
Fiscal Policy: If heavy tax is levied on Pepsi then its price will rise leaving a negative impact on
its sales, but such a thing has not taken place making it still feasible for a huge customer base.

16. Following are the cultural and social factors that also affect the product and market:
1. Psychographic It is a combination of demographic and psychological factors. Psychological attributes mean how
you perceive things. The company will focus on the behaviour of consumers and make different changes in their
product quantity or quality and in promoting their product so that they can attract the customers. Keeping in view
that the behaviour of different consumers is not alike they have to make their marketing strategies in accordance
with their requirements so that they are convinced to buy the product.
2. Religious: Due to a majority of Hindu cultural values customer of India prefer to use vegetarian products. and
Religious factors can influence the market sales of Pepsi.
3. Social Status: Pepsi is a well renowned brand. People who are brand conscious will not drink beverages of lesser
known brands such as RC cola. They will try to show their status by drinking Pepsi which is known to all as a
quality drink.
4. Media: It is a very important factor for marketing. Media these days is a very effective way of inspiring people to
buy a specific product. Good promotion has boast up sales to a great extent.
Socio-Cultural environment. (India)

17. India is a politically stable economy; foreign investors are attracted to India. The Indian government is improving
business with trade and investment.
1. Political Stability: Whenever the government is considered to be stable, the business will flourish. If there is
political stability in the country the policies and strategies made by Pepsi are implemented. Foreign companies
are also keen to invest in those countries which are politically stable where they have no fear of decline in their
market share or shut down due to sudden change of government.
2. Mixed Economy In mixed economy government and private sector both plays their role in developing the
economy of the country. Investment by foreign companies like Pepsi is more likely to flourish in mixed economy.
3. Laws Formulation Government has given copy rights to Pepsi so that another company cannot sell their product
by the name of Pepsi. The countries where laws are formulated, the strategies and activities of the company are
different.
Political environment. (India)

18. Technological environment. (India)
Research & Development
Through research and development quality of product has increases over the years. Better techniques and machinery
are deployed for improvised quality and mass production. When technology is advance the supply of the product
automatically increases and therefor pepsi is able to meet with such a huge demand.

19. Geographical location: Thanks to the fact India is a tropical country with almost 9 months as summers and
with minimum seasonal swings the company already has a edge over the market. Even though it tries to
cover up an losses by promoting in those regions where condition is still favourable.
Climate: Pepsi is more suitable to places like India which is a sub-continent.
Infrastructure: Roads are the basic need of transportation of Pepsi from one place to another. The distribution of Pepsi
from factories to retailers or distributors are done via roads.
Natural environment. (India)

20. Company analysis.
• First, international market expansion strategy through mergers and acquisitions
• Second, formation of strategic alliances in global scale. Specifically, strategic
partnerships have been formed with Tingyi in China in order to claim a share in
growing beverage market in China.
• Third, focus on emerging markets. The share of net revenues from developing
and emerging markets such as China, India, and Russia have been increased
from 24% in 2006 to 35% in 2012.
• Fourth, focus on organisational culture.
• Fifth, developing and promoting the idea of One PepsiCo.
• Sixth, innovation in marketing initiatives.

21. COLLABORATORS
• Collaborators help the company run its business without actually being part of it.
• Suppliers provide the organization with raw materials, equipment, software, and
services that help it operate its business.
• G. D. Searle & Company supplies Pepsico with NutraSweet for Pepsico's diet
soft drinks. Collaboration with a supplier like G. D. Searle eliminates the need for
Pepsico to make all of its ingredients.

22. Competition. (Coca-Cola)
• Competition from newly emerging superpowers such as China, India, Brazil and
Russia are threatening the level of profitability of PepsiCo for long-term
perspectives.
• Currently, PepsiCo is addressing this problem by engaging in mergers and
acquisitions and forming strategic partnerships with local business organisations
in emerging economies.
• The Coca-Cola Company has historically been considered PepsiCo's primary
competitor in the beverage market in December 2005.
• The majority of PepsiCo's revenues no longer come from the production and
sale of carbonated soft drinks.
• As a result of mergers, acquisitions and partnerships pursued by PepsiCo in the
1990s and 2000s, its business has shifted to include a broader product base,
including foods, snacks and beverages.

23. Product Diversification (Coca-Cola )

24. STRENGTHS
1.Product diversity.
2.Extensive distribution channel.
3.Corporate Social Responsibility (CSR) projects.
4.Competency in mergers and acquisitions.
5.22 brands earning more than $1 billion a year.
6.Successful marketing and advertising campaigns.
7.Complementary product sales.
8.Proactive and progressive.
WEAKNESS
1.Over-dependence on Wal-Mart
2.Low pricing
3.Questionable practices (using tap water but labelling it as
mountain spring water)
4.Much weaker brand awareness and market share in the world
beverage market compared to Coca-Cola
5.Too low net profit margin
Opportunities
1.Growing beverages and snacks consumption in emerging
markets (especially BRIC)
2.Increasing demand for healthy food and beverages
3.Further expansion through acquisitions
4.Bottled water consumption growth
5.Savory snacks consumption growth
Threats
1.Changes in consumer tastes
2.Water scarcity
3.Decreasing gross profit margin
4.Legal requirements to disclose negative information
on product labels
5.Strong dollar
S.W.O.T

25. References
Annual Report (2012) PEPSICO
Boone, L.E. & Kurtz, D.L. (2013) “Contemporary
Marketing” Cengage Learning
Campbell, D., Stonehouse, G. & Houston, B. (2012)
“Business Strategy” 2nd edition, Routledge
Holbeche, L. (2013) “Aligning Human Resources and
Business Strategy”, 2nd edition, Routledge
Sheetz-Runkle, B. (2010) “Sun Tzu for Women: The Art of
War for Winning in Business” Adams Business