TABLE OF CONTENT

Number Topicname

1 Tableofcontent

2 Productoverview

2 Capturingcustomervalue

3 MarketingStrategy (Segmenting,targeting,positioning)

9 Analyzingthemarketingenvironment

11 Brandstrategies

13 Distributionmanagement

16 Integratedmarketingcommunication

17 Bibliography

Product overview
Pepsi is a carbonated soft drink that is produced and manufactured by PepsiCo. Pepsi was
first introduced as "Brad's Drink" in New Bern, North Carolina, United States, in 1893
by Caleb Bradham, who made it at his drugstore where the drink was sold. It was later labeled
Pepsi Cola, named after the digestive enzyme pepsin and kola nuts used in the
recipe. Created and developed in 1893 and introduced as Brad's Drink, it was renamed
as Pepsi-Cola on August 28, 1898, then to Pepsi in 1961, and in select areas of North
America, "Pepsi-Cola Made with Real Sugar" as of 2014.

Capturing Customer Value

Value Proposition of Pepsi:

Pepsi follows winning value propositions like More for less, The same for less or More for
the same. Pepsi has its products from low price to high price. It depends on the quantity.
Where their 250 ml bottle is almost 20 tk on the other hand their 2 ml pet bottle is almost 90
tk. They are giving their product in a very reasonable price and in different orientations so that
their target customers can afford to have it. In every occasion Pepsi brings special offers.
Like, they reduce the price; give extra quantity of drinks in the same price thus they follow the
three winning value proposition. It depends on market situation and competitor that what
strategy they will follow.

4Ps:

Product:

A product (in Pepsi's case, a popular soda drink with cola flavoring) must appeal to the
marketplace and deliver taste to consumers.

Price:

The second element, price, is all about offering a product for an appealing price - one that
still allows PepsiCo to make a tidy profit from the sale of their drinks.

Place:

The third element, place, is about distribution of soda drinks. Drinks may be sold in mass
chain stores, such as Wal-Mart, and in an array of other retail stores, such as drug stores,
grocery stores, and corner stores or bodegas. Distribution is the key to getting the product
in front of consumers, so place is a very important part of the overall sales equation.

Promotion:
 Promotion includes the marketing and advertising of a product. In the case of Pepsi,
marketing is international and takes place in every form of mass media - including
television ads, print ads, and online marketing.

Marketing Strategy
Selecting Customers to serve:

Market Segmentation

As we know that Pepsi is provided among a huge population which is called market. To
distribute it and increasing the revenue the market should be segmented. Pepsi has
segmented their market keeping four major segmentation variables in their mind which are:

Geographic

Demographic

Psychographic

Behavioral

Geographic Segmentation:

Geographic segmentation means dividing the market into different geographical units such
as nations, regions, states, countries, cities or even neighborhood. Pepsi has put little
emphasis to segment their market geographically. They are doing business almost in
maximum places around the world.

Demographic Segmentation:

Despite the large customer base in the Soft Drink industry, Pepsi prefers to segment itself as
the beverage choice of the New Generation, Generation Next, or just as the Pepsi
Generation. These terms adopted in Pepsis advertising campaigns are what marketers refer
to as Generation X, which are profiled to be between the ages of 18 to 29. In addition, Pepsi
shifted its focus to the growing American teenage market in the 1990s by forming exclusive
contracts with American schools and developing advertising campaigns such as The Next
Generation and the Joy of Pepsi, featuring Britney Spears. Pepsi believes that if they can
get this market to adopt their product, they could establish a loyal customer in a long run.

Psychographic segmentation:
Psychographic segmentation divides buyers into different groups based on social class,
lifestyle or personality characteristics. People from same demographic group can have very
different psychographic makeups. Pepsis segmentation has also been emphasized psycho
graphically. Their beverages are very much focusing towards lower and upper middle class
as they can afford to drink Pepsi. They have a product like Mountain Dew a particular drink
which is focused especially who has adventurous personality. Their campaign of this drink
totally focuses to adventurous young people.

Behavioral segmentation:

Behavioral segmentation divides buyers into groups based on their knowledge, attitudes,
uses or responses to a product. In this segment, Pepsi has been concentrating carefully.
Because they offer in every special occasions, for the people who seek for benefits off their
products, to their loyal customer base. Occasional cases like religious festivals; special days
like mothers day, valentines day, friendship day, any individuals birthday or marriage
ceremony or anniversary in a word in every special occasions there are people to whom
buying Pepsi for celebration is must.

Segmentation Variables Data

Geographical

World region Asia

Country Bangladesh

Cities All major cities

Density Urban

Climate Tropical wet

Demographic

Age 14-30

Gender Male, Female

Family Size 1-2, 3-4, 5+

Family Life Cycle Married, Unmarried

 Psychographic

Social Class Middle Class, Upper Class

Lifestyle Actualizes, Believers, Fulfilled, Achievers, Strivers,

Experience makers, Strugglers

Personality Adventurous

Behavioral

Occasions Parties, Birthdays, Sports, Regular occasions

Benefits Quality, Taste

User Status First Time User

Loyalty Status Strong

Readiness Stage Aware, Interested

Market Targeting:

Market Targeting can be carried out at several different levels. Companies can target very
broadly through Undifferentiated Marketing, very narrowly through Micromarketing or
somewhere between Differentiated Marketing and Concentrated or Niche Marketing.
There are four strategies of market targeting. Pepsi follows the strategy of Concentrated or
Niche Marketing. In niche marketing companies goes after a large share of one or a few
segments or niches. Through concentrated marketing, the firm achieves a strong market
position because of its greater knowledge of customer it serves in the niches it serves and
the special reputation in acquires. Pepsi customers are mostly Teenagers and Young Adults
between the ages of 14 to 30. It also targets at Schools, Colleges, Universities, Homes,
Restaurants, Hotels, and Stores They focused on varietal differentiation since 1990 by
introducing a string of niche products. To increase volume in order to counter flat Coca-Cola
sales, Pepsi introduced Sierra Mist in 2002-2003 to take the place of 7-up and go head-to-
head with Sprite. Pepsi has also tried to boost volume by introducing products that appeal to
specific target markets that it currently is not reaching. Pepsi has introduced Code Red and
Live Wire, extensions of Mountain Dew, Pepsi One, and Pepsi Blue. Finally, Pepsi is
countering declining sales of carbonated drinks through the marketing and distribution of
Starbucks ready to drink products, and the acquisition of SOBE and Gatorade. The success
of Pepsis Mountain Dew Code Red launched in 2001 was the most successful soft drink
innovation in 20 years and has spurred even more niche product introductions for PepsiCo
as well as other competitors. In some sense Pepsi also follows the idea of Micromarketing.
As they are they are promoting their brands to the local customer groups. They are
sponsoring the signboards for the little or big shopkeepers in town. They are also providing
refrigerator logoed Pepsi. All these they are doing to attract their target customers.

Market Positioning:

PepsiCo plans to further create positions that will give products the greatest advantage in
their target markets. Pepsi has been positioned based on the process of positioning by direct
comparison and have positioned their products to benefit their target market.

Positioning Strategies of Pepsi:

To find points of differentiation, Pepsi have followed some strategies which have differentiated
themselves from others. Usually marketers try to differentiate along the lines of following
things

Product Differentiation

Channel Differentiation

Image Differentiation

Pepsi have differentiated themselves in the field of Product Differentiation, Channel

Differentiation and Image Differentiation. The unique characteristic of their product and their
brand image has differentiated themselves from the other beverages in market.

Product Differentiation:

Product differentiation comes into play for sure in the case of Pepsi. When looking at Pepsi,
people think of soda.
Channel Differentiation:

Coke and Pepsi distribute their drinks through independent bottlers. These firms make the
ingredients for the drinks and then ship them to the local bottlers, who pretty much finalize
the product. After this is done, this bottler has the right to distribute whatever brand it wants
to a specific region. On the other hand, a brand such as Canady Dry does something much
different. Canady Dry packages its product in several locations and then ships them to
wholesale grocers who distribute them to the local grocery stores and outlets. This is a great
example as to why Canady Dry is strong within local grocery stores, but why they are not
present in vending machines like Pepsi is. Furthermore, I found it really interesting that since
the vending machine market is dominated by Pepsi and Coke, that Canady Dry actually has
to be purchased in order to get into a vending machine; something that doesnt happen too
often.

Image Differentiation:

Creating a strong and distinctive image requires creativity and hard work. Symbols, signs,
logos and color are used to create strong-company or brand recognition and image
differentiation.

Positioning statement for Pepsi:

As we discussed earlier that Pepsi positions itself on points of difference as well as points of
parity. Pepsi's POD is their forward thinking attitude. According to that Pepsis positioning
statement is

To new generation, those who want the best taste in drinks, Pepsi is a cold drink
which gave the best taste, low fat in a reasonable spending.

Marketing Management Orientation:

Production concept: Pepsi always follows Production concept. They always more focus
more on quantity but less focus on quality. They produce a huge amount of product, So that
the cost of the production decreases.

Amountof
product
Lower
Higher
 Production
cost

Marketing Concept: Pepsi follows marketing concept. They always highlight their target
markets needs and make sure that the product is available and highly affordable for them.

Analyzing the Marketing Environment

Micro environment for Pepsi:

The company: PepsiCo is the company which produces Pepsi.

Suppliers: ABDUL MONEM SUGAR REFINERY LTD, IGLOO BOTTLERS GRADE SUGAR.
Tanvirs (PEPSI COLA CANS SPEAKER), Partex Plastics Ltd. (PLASTIC CLOSURES)

Marketing Intermediaries: Akin Enterprise, BANGLADESH. ANSii Computers,

BANGLADESH.

Customers: Pepsi customers are mostly young group between the ages of 14 to 30.

Competitors: Coca Cola, RC Cola, Red Bull etc. are the competitors of Pepsi.

Macro environment for Pepsi:

Demographic Environment: In the demographic environment, marketers must be aware of

worldwide population growth; changing mixes of age; ethnic composition, and educational
levels; the rise of nontraditional families; large geographic shifts in population; and the move
to micromarketing and away from mass marketing. The world population is showing
"explosive" growth, totaling 6.1 billion in 2000 and will exceed 7.9 billion by year 2025.A
growing population does not mean growing markets unless these markets have sufficient
purchasing power. Nonetheless, companies that carefully analyze their markets can find
major opportunities. Countries also vary in ethnic and racial makeup. At one extreme is
Japan, where almost everyone is Japanese; at the other is the United States, where people
from come virtually all nations. Each group has certain specific wants and buying habits.
Several food, clothing, and furniture companies have directed their products and promotions
to one or more of these groups. Pepsi is the product which makes a balance demographic
environment.

Economic Environment: Markets require purchasing power as well as people. The available
purchasing power in an economy depends on current income, prices, savings, debt, and
credit availability.

Marketers must pay close attention to major trends in income and consumer-spending
patterns. Marketers often distinguish countries with five different income-distribution patterns:
(1) very low incomes; (2) mostly low incomes; (3) very low, very high incomes; (4) low,
medium, high incomes; and (5) mostly medium incomes. Marketers must pay careful attention
to major changes in incomes, cost of living, interest rates, savings, and borrowing patterns
because they have a strong impact on business and PepsiCo is always aware of economic
environment for Pepsi.

Natural Environment: In the natural environment, marketers need to be aware of raw

materials shortages, increased energy costs and pollution levels, and the changing role of
governments in environmental protection. The earth's raw materials consist of the infinite, the
finite renewable, and the finite nonrenewable. Infinite resources, such as air and water, are
becoming a problem such as water shortages. Finite renewable resources, such as forests
and food, must be used wisely. Forestry companies are required to reforest timberlands in
order to protect the soil and to ensure sufficient wood to meet future demand. Finite
nonrenewable resources - oil, coal, platinum, zinc and silver will pose a serious problem as
the point of depletion approaches. Dramatic rise in oil prices can also create a renewed
search for alternative energy forms. Some industrial activity will inevitably damage the natural
environment. About 42 percent of U.S. consumers are willing to pay higher prices for "green"
products. This creates a large market for pollution-control solutions, such as scrubbers,
recycling centers, and landfill systems. Governments vary in their concern and efforts to
promote a clean environment. Many poor nations are doing little about pollution, largely
because they lack the funds or the political will. Richer nations are able to help the poorer
nations control their pollution, but even the richer nations today lack the necessary funds.
For Pepsi-Cola, the packaging of Pepsi is closely related to the natural environment. So they
always try to make the packaging of Pepsi in recycling format.

Technological Environment: This is one of the most dramatic forces shaping people's lives.
The economy's growth rate is affected by how many major new technologies are discovered.
New technology also creates major long-run consequences that are not always foreseeable.
Therefore, the marketer should monitor the following trends in technology: the pace of
change, the opportunities for innovation and increased regulation. Many of today's common
products were not available 40 years ago. An increasing number of ideas are being worked
on and the time between the appearance of new ideas and their successful implementation
is all but disappearing. So is the time between introduction and peak production.90% of all
the scientists who ever lived is alive today and technology feeds upon itself. Scientist today
is working on a startling range of new technologies that will revolutionize products and
production processes. Some of the most exciting work is being done in biotechnology,
computers and telecommunications. Many companies are content to put their money into
copying competitors' products and making minor feature and style improvements. As
products become more complex, the public needs to be assured of their safety.
Consequently, government agencies' powers to investigate and ban potentially unsafe
products have been expanded. However their innovation level is not so high but PepsiCo
always try to make new innovation in Pepsi.

Political-Legal Environment: Marketers must work within the many laws regulating
business practices and with various special-interest groups. Business legislation has three
main purposes: to protect companies from unfair competition, to protect consumers from
unfair business practices and to protect the interests of society from unbridled business
behavior. The laws are not always administered fairly; regulators and enforcers may be lax
or overzealous. Marketers must have a good working knowledge of the major law protecting
competition, consumers and society. As more business takes place in cyberspace marketers
must establish new parameters for doing electronic business ethically. Many companies have
established public affairs departments to deal with these groups and issues. An important
force affecting business is the consumerist movement - an organized movement of citizens
and government to strengthen the rights and powers of buyers in relation to sellers. The
company monitors the political environment of the many foreign nations in which Pepsi is
sold.

Social-cultural Environment: In the social-cultural arena, marketers must understand

people's views of themselves, others, organizations, society, nature and the universe. They
must market products that correspond to society's core and secondary values and address
the needs of different subcultures within a society. People living in a particular society hold
many core beliefs and values that tend to persist. Secondary beliefs and values are more
open to change. Therefore, marketers have some chance of changing secondary values but
little of changing core values. Each society contains subcultures. To the extent that sub
cultural groups exhibit different wants and consumption behavior, marketers can choose
particular subcultures as target markets. Although core values are fairly persistent, cultural
swings do take place. Today, young people are influenced by new heroes and new activities:
Tiger Woods, and extreme sports. It must also continue to monitor the cultural environments
of the other countries in which it does business of Pepsi.

Brand strategies
Brand Positioning:
Product attributes: First introduced as "Brad's Drink".

1893 (as Brad's Drink)

1898 (as Pepsi-Cola)
1961 (as Pepsi)
2014 (as Pepsi-Cola)

Product Benefits: fountain drink, aid in digestion and boost energy (1893).

Soda (carbonated soft drinks), with different types of calories and taste.

Beliefs and Values- create with slogan they provide since 1893-2014.

19391950: "Twice as Much for a Nickel"

1950: "More Bounce to the Ounce"

19501957: "Any Weather is Pepsi Weather"

2012: "Change the Game"

2013present: "Live for Now"

Brand name selection:

Created and developed in 1893 and introduced as Brad's Drink, it was renamed as Pepsi-
Cola on August 28, 1898, then to Pepsi in 1961, and in select areas of North America, "Pepsi-
Cola Made with Real Sugar" as of 2014. 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, 1904.

Brand development:

Line Extension- In a line Pepsi has Diet Pepsi, Pepsi Next, and Pepsi Zero etc.
Distribution Channel of Pepsi
Marketing channels are sets of interdependent organization involves in the process of
making a product or service available for use or consumption. By channel distribution of Pepsi
means the intermediaries or the process through which Pepsi is transferred from the producer
to the ultimate users. There are a lot of intermediaries between Pepsi producers and
consumers. Some intermediaries like wholesalers and retailers buy and resale the product.
They are known as merchant middle men.

Intensive Distribution:

Pepsi Co follows an intensive distribution strategy to distribute Pepsi. To support their

universal feature they want to place their product in as many outlets as possible.
Distribution Model of Pepsi:

Pepsi uses two types of distribution model to distribute the product among the consumers.
They are

Direct Distribution System

Indirect Distribution System

Direct Distribution System:

Pepsi uses its direct distribution system to deliver suppliers. It Supplies the product directly
with

PIZZA HUT
KFC

According to the marketing channel Pepsi uses zero level of marketing channels. It means

Manufacturer Consumer

We can see there are no intermediaries between manufacturer and consumer. This single
type of marketing channel is maintained by Pepsi.

Indirect Distribution System:

In this system, there are a lot of intermediaries such as distributors, retailers, wholesaler etc.
To make the product available at the right places at the right time in the market, the sales
department of PepsiCo Company pays major attention on controlling the channel of
distribution. The nature of the channel is as follows:-

PEPSI DISTRIBUTORS

WHOLESALER
 RETAILERS CONSUMERS

So according to the marketing channel Pepsi uses 2-level marketing channel. It means

Manufacturer Wholesalers Retailers Consumer

Number of Intermediaries:

Pepsi Provides direct and indirect employment of 1, 50, 000 people (including suppliers and
distributors).

Distributors:

Distributors frequently have a business relationship with manufactures that they represent.
The distributors of Pepsi maintain exclusive buying agreements that limit the number of
participants. The distributor becomes the companys direct point of contact. Distributors dont
sell the product directly to consumers. At first PepsiCo supplies Pepsi to the distributors. Then
they resale the product to wholesaler or retailer. According to http://www.exporters.sg/, there
are 70 distributors of Pepsi. Some of them are:

OTC GLOBAL LTD, INDIA (Exporting and importing Pepsi in 500 ML pet Bottles)

SUNRISE FOODSTUFF JSC, VIET NAM (Exporting Famous-Brand Pepsi Soft Drinks
330ml.)

Wholesalers:

The wholesalers of Pepsi generally buy a large quantity of products directly from distributors
or the company. Then they resale the product to the retailers. According to
http://www.exporters.sg/there are 70 wholesalers of Pepsi. Some of them are:

FAR WAY GENERAL TRADING LLC (Exporting and importing Pepsi)

Brand Distribution Poland LTD, POLAND (Exporting Pepsi 0,33L 24 cans case)

Retailers:

Retailers consist of small and large for-profit businesses that sell products directly to
consumers. The retailers buy small quantities of an item from a distributor or a wholesaler.
Then resale them to consumers. According to http://www.exporters.sg/ there are 563 retailers
of Pepsi. Some of the retailers are

Akin Enterprise, BANGLADESH.

ANSii Computers, BANGLADESH.

The channel of distribution is a structure which presents a choice among alternative

channels of distribution of the different marketing situation faced by retailers, wholesaler and
producers within the structure. To bearing maximum profits of all institutions concerned a
channel of distribution should be treated as a unit of total system of action.

Integrated Marketing Communications

Pepsi has popularity among the population. Therefore, it is quite challenge for Pepsi Cola to
maintain and increase this popularity. Integrated Marketing Communications (IMC) is one of
the effective strategies that researcher believe it will solve the existing problem in the
business area. Nowadays, competition in the market tend to increase, the customer also
change their lifestyle and buying behavior become increasingly changed, then using only one
tool for marketing communication is not enough. It is because many senders or organization
try to reach to the same receivers or customers. So, using many of strategies and
communication tools will help their brand to become well known. Integrated Marketing
Communication (IMC) is a tool that suitable for encouraging the customer buying behaviors.

Promotion Mix of Pepsi:

The promotional mix element used for the Pepsi Refresh campaign theme centered on social
responsibility and delivered with a heavy dose of social media. They took it deeper than any
other campaign, targeting the millennial generation ages 14 to 29 by utilizing social media as
an additional source along with traditional media to launch the Pepsi Refresh campaign. The
campaign aired on paid search and display ads on Yahoo and Google to traffic their viewer
to a link on YouTube and Face book too included other channel like e-mail marketing and
mobi sites which drive visitors to the site.

Promotion strategy of PEPSI:

Advertising:

For advertising, it used printed and electronic media. Every newspaper and magazine carries
Pepsi advertisements that make the people interested toward it. Advertisement of Pepsi are
eye catching and attractive. Through advertising it informs the consumer about new brands
and flavors. Pepsi designs their advertisement campaign focusing on the target markets.
They research for the need of people before make the ads.

Sale promotion:

Pepsi has used a variety of sales promotions over the years. They have used celebrity such
as Michal Jackson, Beyonc for endorsements. This has been shown with the use of
Beyonc.
Michal Jackson promoting Pepsi
They have also had essay contest to promotions through schools. They have giveaways in
stores and coupon advertisement in newspapers.
Public relation:
Pepsi is the first product to respond to consumer preference with lightweight, recyclable,
plastic bottles. In addition, different approaches of promotional campaigns such as press
releases have been imposed so as to make the product more appealing to the target market
and to make these product marketable.

Personal selling:

Pepsi use pull strategy for selling the product. In every occasion Pepsi brings special offers.
Like, they reduce the price; give extra quantity of drinks in the same price.

Publicity:

For publicity Pepsi use social media such as Face Book. Not only has that Pepsi used
YouTube to promote its product. It drives public attention toward the product. Pepsi also use
brand ambassador and sponsor cricket team and world cup for publicity.
Direct Marketing:

Pepsi uses its direct marketing to distribute their product through PIZZA HUT, KFC etc. More
than that, they use ecommerce Such as Refreshment Services Pepsi.com to market the
product.

Bibliography
Pepsi
http://www.pepsiproductfacts.com/?or=pusa.1067.
PepsiCo
http://www.pepsico.com/Company/The-Pepsico-Family.aspx .
Wikipedia: Pepsi
http://en.wikipedia.org/wiki/Pepsi.
Wikipedia: PepsiCo
http://en.wikipedia.org/wiki/PepsiCo.
Market Targeting
http://aboutpepsico.blogspot.com/2010/01/market-targeting-is-process-of.html.
http://mpmcgraw.wordpress.com/2011/02/21/product-differentiation/.
New York Times
http://topics.nytimes.com/top/news/business/companies/pepsico_inc/index.html.