SlideShare a Scribd company logo
Relaunching Mountain Dew
       in the U.K.
           Caitlin Joshua, Tom Licitra, Brea
           MacIsaac, Tony Weaver, Sijie Xia
PepsiCo should launch the Mountain
Dew brand in the U.K.
             • Hybrid branding strategy makes U.K.
     Will
 generate      market attractive
  revenue
             • Mountain Dew can capture market
               share

     Will
  be cost
             • PepsiCo can leverage existing assets
 effective
             • PepsiCo can leverage existing
               relationships


                                                      2
PepsiCo should launch the Mountain
Dew brand in the U.K.
             • Hybrid branding strategy makes U.K.
     Will
 generate      market attractive
  revenue
             • Mountain Dew can capture market
               share

     Will
  be cost
             • PepsiCo can leverage existing assets
 effective
             • PepsiCo can leverage existing
               relationships


                                                      3
Hybrid branding strategy makes U.K.
market attractive
• Both U.K. energy drink and carbonated soft drink
  (CSD) markets are growing
• U.K. offers attractive growth in target market of 15-
  34 year-olds




                                                          4
U.K. energy drink and carbonated soft
drink (CSD) markets are growing
16
                          13.7
14
12   11.4
                                 Energy drink market has grown
10
8
6
4
2
                                  366%    Since 1996
0
     2005                 2010
            2005   2010



                                                                 5
U.K. offers attractive growth in target
market of 15-34 year-olds
                                18.74
          15.87
15


10


5


0
          2007                  2012
                  2007   2012



                                          6
PepsiCo should launch the Mountain
Dew brand in the U.K.
             • Hybrid branding strategy makes U.K.
     Will
 generate      market attractive
  revenue
             • Mountain Dew can capture market
               share

     Will
  be cost
             • PepsiCo can leverage existing assets
 effective
             • PepsiCo can leverage existing
               relationships


                                                      7
Mountain Dew can capture hybrid
market share
• Mountain Dew has strong brand awareness
• Consumers show high probability of purchase of
  Mountain Dew
• PepsiCo can compete with existing competitors for
  share
• Cannibalization of existing Pepsi products will not
  occur



                                                        8
Mountain Dew has strong brand
awareness


       24%
                          Brand Aware
                          Brand Unaware

              76%



                                          9
Consumers show high probability of
purchase of Mountain Dew


       24%                 Brand Aware,
                           Would Buy
                           Brand Aware,
                57%        Wouldn't Buy
       19%                 Brand Unaware




                                       10
Mountain Dew can compete with
existing CSD competitors for share
50%
        Carbonated soft drinks’ brand U.K. market share
40%

30%

20%

10%

0%




                                                          11
PepsiCo can compete with existing
energy drink competitors for share
50%                     Energy drinks’ brand U.K. market share

40%

30%

20%

10%

0%
             Red Bull              Lucozade          Own Brand/Other

      With only two large competitors, there is room for competition


                                                                       12
Cannibalization of existing Pepsi
products will not occur
                 Lemon Lime   Caffeine

     Pepsi                      ✓
      7Up           ✓
  Mountain Dew      ✓           ✓



                                         13
PepsiCo should launch the Mountain
Dew brand in the U.K.
             • Hybrid branding strategy makes U.K.
     Will
 generate      market attractive
  revenue
             • Mountain Dew can capture market
               share

     Will
  be cost
             • PepsiCo can leverage existing assets
 effective
             • PepsiCo can leverage existing
               relationships


                                                      14
PepsiCo can leverage existing assets
• U.K. has largest operations of PepsiCo’s international
  division
• U.K. has $2.1B of PepsiCo’s long lived assets




                                                       15
PepsiCo should launch the Mountain
Dew brand in the U.K.
             • Hybrid branding strategy makes U.K.
     Will
 generate      market attractive
  revenue
             • Mountain Dew can capture market
               share

     Will
  be cost
             • PepsiCo can leverage existing assets
 effective
             • PepsiCo can leverage existing
               relationships


                                                      16
PepsiCo can leverage existing
relationships
• PepsiCo can leverage its existing promotional ties
• PepsiCo can leverage is existing vendor relationships
• PepsiCo can leverage its existing supplier
  relationships




                                                          17
PepsiCo can leverage its existing
promotional ties
• Retail consolidation increases importance of
  relationships with major vendors
• Opportunities exist to renegotiate contracts annually




                                                      18
PepsiCo can leverage its existing
vendor relationships
• PepsiCo spent $2.9B on promotions in 2007
• Strong relationship with global marketing company
  OmniCom
• U.S. Mountain Dew strategy targets youth segment
  and can easily be leveraged in U.K.




                                                      19
PepsiCo can leverage its existing
supplier relationships
• Collaboration is essential to the success of PepsiCo’s
  supply chain
• Resources are available from a limited number of
  suppliers with which Pepsi has strong relationships
• Greater economies of scale can be gained through
  higher quantity orders




                                                       20

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Pepsi co presentation (1)

  • 1. Relaunching Mountain Dew in the U.K. Caitlin Joshua, Tom Licitra, Brea MacIsaac, Tony Weaver, Sijie Xia
  • 2. PepsiCo should launch the Mountain Dew brand in the U.K. • Hybrid branding strategy makes U.K. Will generate market attractive revenue • Mountain Dew can capture market share Will be cost • PepsiCo can leverage existing assets effective • PepsiCo can leverage existing relationships 2
  • 3. PepsiCo should launch the Mountain Dew brand in the U.K. • Hybrid branding strategy makes U.K. Will generate market attractive revenue • Mountain Dew can capture market share Will be cost • PepsiCo can leverage existing assets effective • PepsiCo can leverage existing relationships 3
  • 4. Hybrid branding strategy makes U.K. market attractive • Both U.K. energy drink and carbonated soft drink (CSD) markets are growing • U.K. offers attractive growth in target market of 15- 34 year-olds 4
  • 5. U.K. energy drink and carbonated soft drink (CSD) markets are growing 16 13.7 14 12 11.4 Energy drink market has grown 10 8 6 4 2 366% Since 1996 0 2005 2010 2005 2010 5
  • 6. U.K. offers attractive growth in target market of 15-34 year-olds 18.74 15.87 15 10 5 0 2007 2012 2007 2012 6
  • 7. PepsiCo should launch the Mountain Dew brand in the U.K. • Hybrid branding strategy makes U.K. Will generate market attractive revenue • Mountain Dew can capture market share Will be cost • PepsiCo can leverage existing assets effective • PepsiCo can leverage existing relationships 7
  • 8. Mountain Dew can capture hybrid market share • Mountain Dew has strong brand awareness • Consumers show high probability of purchase of Mountain Dew • PepsiCo can compete with existing competitors for share • Cannibalization of existing Pepsi products will not occur 8
  • 9. Mountain Dew has strong brand awareness 24% Brand Aware Brand Unaware 76% 9
  • 10. Consumers show high probability of purchase of Mountain Dew 24% Brand Aware, Would Buy Brand Aware, 57% Wouldn't Buy 19% Brand Unaware 10
  • 11. Mountain Dew can compete with existing CSD competitors for share 50% Carbonated soft drinks’ brand U.K. market share 40% 30% 20% 10% 0% 11
  • 12. PepsiCo can compete with existing energy drink competitors for share 50% Energy drinks’ brand U.K. market share 40% 30% 20% 10% 0% Red Bull Lucozade Own Brand/Other With only two large competitors, there is room for competition 12
  • 13. Cannibalization of existing Pepsi products will not occur Lemon Lime Caffeine Pepsi ✓ 7Up ✓ Mountain Dew ✓ ✓ 13
  • 14. PepsiCo should launch the Mountain Dew brand in the U.K. • Hybrid branding strategy makes U.K. Will generate market attractive revenue • Mountain Dew can capture market share Will be cost • PepsiCo can leverage existing assets effective • PepsiCo can leverage existing relationships 14
  • 15. PepsiCo can leverage existing assets • U.K. has largest operations of PepsiCo’s international division • U.K. has $2.1B of PepsiCo’s long lived assets 15
  • 16. PepsiCo should launch the Mountain Dew brand in the U.K. • Hybrid branding strategy makes U.K. Will generate market attractive revenue • Mountain Dew can capture market share Will be cost • PepsiCo can leverage existing assets effective • PepsiCo can leverage existing relationships 16
  • 17. PepsiCo can leverage existing relationships • PepsiCo can leverage its existing promotional ties • PepsiCo can leverage is existing vendor relationships • PepsiCo can leverage its existing supplier relationships 17
  • 18. PepsiCo can leverage its existing promotional ties • Retail consolidation increases importance of relationships with major vendors • Opportunities exist to renegotiate contracts annually 18
  • 19. PepsiCo can leverage its existing vendor relationships • PepsiCo spent $2.9B on promotions in 2007 • Strong relationship with global marketing company OmniCom • U.S. Mountain Dew strategy targets youth segment and can easily be leveraged in U.K. 19
  • 20. PepsiCo can leverage its existing supplier relationships • Collaboration is essential to the success of PepsiCo’s supply chain • Resources are available from a limited number of suppliers with which Pepsi has strong relationships • Greater economies of scale can be gained through higher quantity orders 20