A DISSERTATION REPORT

ON
“MARKETING STRATEGY OF PEPSICO ®”

SUBMITTED BY
SPARSH RAJ (BBA VITH SEMESTER)
ENROLLMENT NO. - G162350192

SUBMITTED FOR THE PARTIAL FULFILLMENT OF

THE REQUIREMENT OF BBA PROGRAMME FROM
(HNBGU)

INTERNAL GUIDE
MR. SACHIN NAUTIYAL
(ASST. PROFESSOR)

SGRRITS, PATEL NAGAR, DEHRADUN - 248001

(UTTARAKHAND)
BATCH (2016-2019)
1
 DECLARATION OF CANDIDATE

I hereby declare that this report entitled, “MARKETING STRATEGY OF PEPSICO ®” is

made and submitted by me to Shri Guru Ram Rai Institute of Technology & Science in
partial fulfillment of requirement for the degree of Bachelor of Business Administration
under the supervise and guidance of Mr. Sachin Nautiyal

I further declare that this report entitled, “MARKETING STRATEGY OF PEPSICO ®” is

my own original research work and has been submitted to the Institute/University for the
award of professional degree.

Date: - Sparsh Raj

(BBA VIthSEM)

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 CERTIFICATE BY INTERNAL GUIDE

This to certify that Mr. Sparsh Raj has completed and submitted his dissertation report on
“MARKETING STRATEGY OF PEPSICO ®” under my guidance and supervision. He
was in constant touch with me.

I wish him success in his entire future endeavor.

Date: - Mr. Sachin Nautiyal

(Faculty of Management)

SGRRITS, DEHRADUN

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 ACKNOWLEDGEMENT

At the very outset, I would like to acknowledge with immense gratitude the support and
guidance of some people without whom the project could not have been completed. Also,
thanks to them, from whom I learnt a lot more additional things than that just restricted to my
project.
I am thankful to “PEPSICO ®” for providing me with the wonderful opportunity and
allowing me to take this study.
Also, I would like to thank the faculty guide of my college Mr. Sachin Nautiyal who guided
me in my project.
I would also like to thank and the Human resource department for allowing us to do the
training.

Last but not the least I would like to thank my parents who have always showed their full
faith in me, and are the biggest source of my encouragement and guidance.

Sparsh Raj
(B.B.A VIth SEM)
4
 TABLE OF CONTENTS

S. No. ITEMS PAGE NO.

1. DECLARATION OF CANDIDATE 2

2. CERTIFICATE BY INTERNAL GUIDE 3

3. ACKNOWLEDGEMENT 4

4. OBJECTIVE OF THE STUDY 6

5. ABSTRACT 7

6. MARKETING STRATEGIES ADOPTED BY PEPSI 8

7. COMPANY OVERVIEW 9

8. SOFT DRINK MARKET IN INDIA 14

9. BUYER DECISION PROCESS 15

10. PEST ANALYSIS 16-18

11. SWOT ANALYSIS 19-24

12. STP ANALYSIS 25-28

13. FOUR P ANALYSIS 29-37

14. THE COLA WARS 38-40

15. RESEARCH METHODOLOGY 41-43

16. DATA ANALYSIS AND INTEREPRETATION 44-57

17. CONCLUSION 58

18. RECOMMENDATION & SUGGESTIONS 59 - 60

19. ANNEXTURE (QUESTIONAIRE) 61-64

20. BIBLIOGRAPHY 65

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 OBJECTIVE OF THE STUDY

1. The main purpose of this study is determining the different strategies that are adopted by
the companies.

2. The strategies will be evaluated to see which is the best amongst them and which are most
effective.

3. Acceptability of Pepsi products by the consumers and marketers.

4. Identifying the competitors and positioning Pepsi in comparison to them.

5. To find out marketing strategy of Pepsi.

6. To analyze the SWOT analysis of Pepsi.

7 To know about customer value of Pepsi.

8. To know about customer perception towards Pepsi brand image

9. To know about customer satisfaction

10. Impact of market strategy on customer

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 ABSTRACT

I have decided to present our marketing term paper on PepsiCo after studying its marketing

strategies. I worked on PepsiCo’s product range of beverages and focused on Pepsi Cola as

the subject of our analysis.

I have chosen Pepsi for many reasons. It is one of the biggest FMCG brands not only in India

but also globally. Indeed, Pepsi Cola is one of the fastest paced FMCG products worldwide.

Pepsi posed an exciting opportunity to study a brand that is automatically associated with

youth and energy.

I worked on Pepsi in order to understand the various aspects of its marketing strategy that has

made it the Number 1 Cola drink in India. Our team focused on its strategies viz. Coca Cola

especially in the city of New Delhi. I have also researched extensively on Pepsi’s distribution

network and have made suggestions as to how it can further improve its reach among users in

the future.

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 Marketing Strategies Adopted by Pepsi

➢ Extremely high visibility: enormous resources allocated for advertising

➢ Positioned as a product or the youth: targets “Generation Next”
➢ Unlike global trends, half of the distribution of Pepsi in India done by Company
Owned Bottling Operations (COBOs)
➢ Very low brand loyalty among consumers, so sales depend on timely product
availability
➢ Recent entry into rural markets

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 COMPANY OVERVIEW

PepsiCo, Inc., established in 1965 through the merger of Pepsi-Cola and Frito-Lay is a world

leader in convenient foods and beverages. The company consists of Frito-Lay North America,

PepsiCo Beverages North America, PepsiCo International and Quaker Foods North America.

PepsiCo brands are available in nearly 200 countries and territories. Its success is the result of

superior products, high standards of performance, distinctive competitive strategies and the

high level of integrity of its employees.

PepsiCo offers product choices to meet a broad variety of needs and preference from fun-for-

you items to product choices that contribute to healthier lifestyles. The company's principal

businesses include:

➢ Frito-Lay snacks

➢ Pepsi-Cola beverages

➢ Gatorade sports drinks

➢ Tropicana juices

➢ Quaker Foods

PepsiCo’s mission is “To be the world's premier consumer products company focused on

convenient foods and beverages. We seek to produce healthy financial rewards to investors

as we provide opportunities for growth and enrichment to our employees, our business

partners and the communities in which we operate. And in everything we do, we strive for

honesty, fairness and integrity.”

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The company has two major divisions that are operational in India. The first division is the

traditional Beverages Division. The second division, and the subject matter of this report, is

the Snack Food Division.

The Beverages Division: -

The company has 37 bottling plants in India, and one company-owned concentrate plant.

Pepsi keeps its concentrate formula, a secret. The main products are: -

➢ Pepsi Cola

➢ Diet Pepsi

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➢ 7 Up

➢ Mirinda

➢ Mountain Dew

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➢ Slice

➢ Tropicana Juices

➢ Aquafina

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PepsiCo International

Pepsi-Cola began selling its products outside the United States and Canada in the mid-1930s,

opening in the United Kingdom in 1936. Operations grew rapidly beginning in the 1950s.

Today, PepsiCo beverages are available in nearly 200 countries and territories. Some of the

major brands include Pepsi, Mountain Dew, Aquafina, Gatorade and Tropicana.

In addition to brands marketed in the United States, PepsiCo International brands include

Mirinda, Seven-Up, Aquafina, Gatorade, Tropicana and many local brands.

PepsiCo’s Sustainable Advantage

Three major sustainable advantages give PepsiCo a competitive edge as they operate in the

global marketplace,

(1) Big, muscular brands

(2) Proven ability to innovate and create differentiated products

(3) Powerful go-to-market systems

Their extraordinarily talented and dedicated workforce optimizes these advantages and

creates magic in the market place. Investing in innovation fuels the brands and this in turn

drives top-line growth. Dollars from that top-line growth are strategically reinvested back

into new products and other innovation, along with cost-savings projects. Thus, the cycle

continues.

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 SOFT DRINK MARKET IN INDIA

India’s one billion people, growing middle class, and low per capita consumption of soft

drinks made it a highly contested prize in the global CSD market in the early twenty-first

century. Ten percent of the country’s population lived in urban areas or large cities and drank

ten bottles of soda per year while the vast remainder lived in rural areas, villages, and small

towns where annual per capita consumption was less than four bottles. Coke and Pepsi

dominated the market and together had a consolidated market share above 95%. While soft

drinks were once considered products only for the affluent, by 2003 91% of sales were made

to the lower, middle and upper middle classes. Soft drink sales in India grew 76% between

1998 and 2012 from 8,670 million bottles to over 10,000 million and were expected to grow

at least 10% per year through 2012. In spite of this growth, annual per capita consumption

was only 8 8-ounce servings versus 17 in Pakistan, 73 in Thailand, 173 in the Philippines and

800 in the United States.

With its large population and low consumption, the rural market represents a significant

opportunity for penetration and a critical battleground for market dominance.

Experts predict that India’s soft drinks market will continue to grow in the coming years,

overcoming the obstacles presented by the difficulty in marketing to such a large and diverse

population and the relatively high cost of packaging as a proportion of selling price.

In addition, the success of smaller pack sizes in the carbonates sector has provided fresh

impetus for low cost packaging, particularly as the major producers look for ways of

competing with lower priced local suppliers.

The market preference for soft drinks in India is regional based. While cola drinks have their

main markets in metro cities and northern states of UP, Punjab, Haryana etc., orange flavored

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drinks are popular in southern states. Sodas too are sold largely in southern states besides sale

through bars. Western markets have a preference towards mango-flavored drinks.

Types

Soft drinks are available in glass bottles, aluminum cans and PET bottles for home

consumption. Fountains also dispense them in disposable containers. The non-alcoholic soft

drink beverage market can be divided into fruit drinks and soft drinks. Soft drinks can be

further divided into carbonated and non-carbonated drinks. Cola, lemon and oranges are

carbonated drinks while mango drinks come under the non-carbonated category. The market

can also be segmented based on the types of products. The brands that fall in the Cola

category are Pepsi, Coca-Cola, Thums Up, Diet Coke, Diet Pepsi etc. The non-cola segment

can be divided into 4 categories based on the types of flavors available, namely: Orange,

Cloudy, Clear and Mango.

THE BUYER DECISION PROCESS

Hosts of factors play an important role in a buyer’s decision-making process. This process

lets him/her screen the different options available and take a final decision.

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The 4 P’s (Product, Price, Promotion & Place) or the Marketing Mix of a product plays a

significant role in this intricate process. The final decision is made based on the marketing

inputs and the various psychological inputs. Every product is perceived in a certain way or

manner. The consumers’ perception of the product is a vital ingredient and the companies

have to ensure that they portray a suitable and strategic image.

The psychological factors (Culture, Attitude, Learning & Perception) also play a critical role

in the decision-making process, but a company can do little to influence these factors.

However, if the suitable market/segment is targeted while positioning the product the

company can generate positive response from the marketplace.

PEST ANALYSIS

In order to scan the external macro-environment in which PepsiCo India operates, it is

necessary to analyze various factors that not only posed some serious threats but also

influenced its effectiveness.

Political Conditions

➢ Although it began its efforts in the mid-1980s, Pepsi was able to make its entry into the

Indian cola market in June, 1990. This was because of high excise duties and government

encouragement of fruit drinks over carbonated drinks. It was jointly launched by PepsiCo,

Punjab Agro Industries Corporation and Voltas.

➢ Pepsi got into trouble when within six months after its launch it caught government’s

attention regarding its commitment. Soon after, a show cause notice was issued to the

company for prima facie violation of the conditions stipulated in the letter of intent with

regards to the production of soft drinks.

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➢ Pepsi had a very significant first mover advantage in India. It had obtained the

government approval for its downstream ventures prior to the FDI guidelines that made

Indian equity holding mandatory.

➢ The government approval that Pepsi acquired had allowed Pepsi to carry out acquisition

of assets to expand its business in the country. Pepsi used this clause to buy out 100%

stake in some domestic bottling companies including Gujarat Bottling Company,

➢ the former Coke franchisee in Ahmedabad.

Economic Conditions

➢ The present Indian soft drinks market can be best described as a duopoly – the players

being Pepsi and Coca Cola. Therefore, Pepsi has sufficient monopoly power over the

consumers.

➢ In India, soft drinks market has a fairly high price elasticity of demand which ensures that

producers must strike a balance between prices and sales volume. So, Pepsi has decided

to peg prices similar to Coca Cola and try to gain market share and try to gain market

share through vigorous promotional activities.

➢ Pepsi was launched in India at the time when the country was trying to open up its

economy and was facing serious doldrums. So, at the period of economic instability,

Pepsi had to face problems to expand its operations.

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 Social Conditions

➢ Rising income of middle class in India is a positive indicator for growth of products like

Pepsi and Coca Cola

➢ Westernized and trendy youth population of India is another big market for Pepsi

products

➢ Booming economy, rising purchasing – power of the people and changing mind sets are

factors contributing to the expanding demand of the Pepsi products.

Technological Conditions

➢ Pepsi has the technology to maintain a highly efficient distribution network which allows

it to satisfy the needs of its customers throughout the country.

Pepsi’s own bottling plants gives it an edge over its competitors in terms of quality of the

product and control over the product.

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 SWOT ANALYSIS

Strengths Weakness

• High Brand Awareness • Powerful Franchisee

• Large number of • Inferior in fountain soft
distributors (100+ in Delhi) drink division
• Wide product offering
• High accessibility
• Large advertising budget
• Wise investments

Opportunity Threats

• Per caps 8 oz in India vis • Controversies

a vis 868 oz in USA • Low brand loyalty
• Large untapped rural • Cheaper and large
population number of substitutes
• Seasonality • Risk of losing market
• CUTTING DOWN share
COSTS

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STRENGTHS: -

➢ High brand awareness: - Pepsi is the world’s most famous #2 multi-billion-dollar brand

and Pepsi is the largest FMCG brand in India.

➢ Large number of distributors: - The company has both franchises owned and company

owned operations in India. Pepsi in Delhi alone has more than 100 distributors. Delhi is

totally franchise operations whereas Punjab now is totally company owned

➢ Wide product offering: - Pepsi is available in glass bottles, aluminum cans and PET

bottles for home consumption. Fountains also dispense them in disposable containers.

Also, they provide a large number of flavors.

➢ High accessibility: - Pepsi products are available in shops in the most elite of malls and at

the same time in the smallest of shops in the back lanes of the poor localities.

➢ Large advertising budget: - Pepsi has the luxury to spend huge amounts on advertising in

a year. This enormous ad budget allows Pepsi to reinforce their products with reminder

advertising and promotions. This large budget also allows Pepsi to introduce new

products and very quickly make the consumer become aware of their new products

➢ Wise investments: - Pepsi also has had the good fortune of making very wise investments.
Some of the best investments have been in their acquiring several large fast food

restaurants. They have also made wise investments in snack food companies like Frito

Lay, which at present time is the largest snack company in the world.

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WEAKNESSES: -

➢ Powerful franchisee: - Ironically, the one strength that has been credited for most of

its success in the past has now become a weakness for Pepsi. This former strength is

the franchise system. The franchise system in Pepsi Corporate view has become a

liability. Pepsi in today’s market must be able to act as one instead of several separate

units. The franchise system has become a hurdle to Pepsi because many of these

franchises have become very strong and will not be dictated by PepsiCo on how to

handle their operations. Some of these franchises are unwilling to support certain

Pepsi products and at times produce their own private label products that are in direct

competition with Pepsi products. Secondly the franchisees are not willing to make

capital expenditures to keep up with Coca-Cola who is a firm believer in reinvesting

into their infrastructure.

➢ Inferior in fountain soft drinks division: -The franchise system has affected fountain

sales due to the fact franchisees are not willing to buy expensive fountain equipment

mainly because the profit margin is so low and could take years to recoup their

investment.

OPPORTUNITY

➢ Per caps in India is 8 oz. vis a vis 868 oz. in USA: - The consumption of Pepsi in

India is still regarded as luxury. An orthodox Indian would still prefer a cup of tea

or coffee to a bottle of Pepsi. So, in the event Pepsi can manage to change their

mindsets it would tap a huge untapped customer base.

➢ Cutting costs: - Since there is tremendous scope for increasing the sales volume,
this also signifies potential to reduce costs per bottle and make the product more

affordable.

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 ➢ Seasonality: - Pepsi is perceived to be a summer drink and max sales happens in

summer months. During winters an average Indian would still prefer a cup of hot

tea to Pepsi.

THREATS: -

➢ Controversies: - Demonstrations across India were organized by the Research

Foundation for Science, Technology and Ecology (RFSTE). Activists wanted the

firms to leave India because they said their plants depleted ground water the soft

drinks giant strenuously denied. Also, the pesticide controversy was a big threat to the

company.

➢ Low brand loyalty: - If a consumer walks into a shop and he is offered a coke instead

of a Pepsi he would in all likelihood accept it. This basically means that the company

needs to be present everywhere every time and that too chilled otherwise it will result

in lost sale.

➢ Low cost and large number of substitutes: -Traditional Indian families would still

prefer a glass of lassi or Nimbu Paani in summers and a cup of tea or coffee in winters

as compared to PEPSI

➢ Risk of losing market share: - Coke is a very strong opponent and gives immense
competition to the Pepsi so there is a constant threat of losing market share since both

the products are very similar and there is almost no brand loyalty present amongst

consumers.

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Barriers to entry:

The soft drinks industry requires a huge investment if one aspires to gain a considerable

market share. The investment would require huge sums of money to setup manufacturing

plants, bottling plants and as we know a massive advertising budget.

As an example, Parle, which was the market leader at one point, did not have the ability to

invest large sums of money in a small period of time and was eventually bought over by -

Pepsi rival, Coca-Cola.

Pepsi in India owns most of its bottling plants – COBOs. Pepsi has about 15 COBOs and

plans to expand further. Pepsi has over the years invested about 600 crores and plans new

investments of another 400 crores.

That is the scale of operations in the Cola industry, making it very difficult for any new

players to enter the market. Another factor that makes entry difficult is the presence of Coca

Cola. The two cola giants among themselves control most of the market, leaving no room for

anyone else.

The gestation period, due to the huge initial investments, is pretty long. Pepsi, which started

operations in India in 1989, broke even in 1997.

Bargaining Power of Suppliers:

There are around 100 franchise owned bottling operations.

Bargaining Power of Buyers:

Buyers by and large do not have much power in the cola market. The number of buyers is too

large for them to exert any influence or control over pricing or any other decisions. Even

though there are very low switching costs the buyers do not wield much power.

The presence of a large competitor, however keeps the price level in check.

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Rivalry:

➢ The rivalry between coke and Pepsi is too well documented. It has stretched from the

start of the latter company till date. It has been witnessed in every continent, country

every market and yes, the courts. There are a number of factors other than the obvious

one – similar product. These are enlisted below

➢ High fixed costs – this forces the two companies to produce near capacity. This high

level of production leads to a fight over the market share.

➢ Perishable product – the companies need to sell their high quantities of produce rather

quickly.

➢ Low switching costs – the switching cost for a customer is pretty low, since

substitutes are similarly priced.

➢ Low product differentiation – other than a select few loyal customers, most customers

do not find any difference between coke and Pepsi.

Threat to substitutes:

Pepsi cola as a product has a number of substitutes and is under constant threat of losing its

market share. The low product differentiation between its biggest competitor does not help.

Another factor is the pricing which is the pretty much the same for most of its substitutes.

There are other threats from outside the industry too. The age-old Nimbu Paani and lassi will

always pose a threat to any manufactured beverage. Even if these are not sold in the market

place on as large a scale, these are substitutes prepared in most consumers’ homes for their

consumption.

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 STP – SEGMENTATION, TARGETING, POSITIONING

SEGMENTATION

Geographic

The region of interest of Pepsi Co. India is the whole of India with special focus on
“Generation Next”

Demographic

Age – Anybody of age between 12 – 29 yrs.

Income – Anybody with Rs 9 in their pocket
Occupation – Basically students and other youngsters
Social Class – Middle class, Upper middle, Lower Upper and Upper uppers.

Psychographic

Personality – It is perceived to be a modern “generation next” drink and one associates this
drink with youngsters.

Behavioral
Benefits – Style, Price (economical), quenches thirst
User status – Regular drinkers of soft drinks
Buyer – Anybody who has Rs 9 in his pocket but basically youngsters

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Age wise consumption pattern: -

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
<20 yrs 20 - 35 yrs 35 - 50 yrs >50 yrs

TARGETING: -

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Pepsi is worldwide associated with the urban youth. 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 Pepsi’s advertising campaigns are referring to the

markets that marketers refer to as Generation X. The Generation X consumer is profiled to be

between the ages of 18 to 29. They have high expectations in life and are very mobile and

active. They adopt a lifestyle of living for today and not worrying about long term goals.

Thus, Pepsi’s main emphasis is on this segment They also have a focus on the 12 to 18-year-

old market. Pepsi believes if they can get this market to adopt their product then they could

establish a loyal customer for life.

POSITIONING

Pepsi has a competitive advantage over Coke because of the image it portrays. Pepsi

promotes itself as the choice of the “New Generation”. Pepsi gets this advantage by

implementing such large marketing projects like “Project Globe”. This marketing plan, which

Pepsi spent 637 million dollars over five years, is to introduce the new rich deep blue

coloring of its packaging. The rich deep blue coloring represents eternal youthfulness and

openness.

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Pepsi has always spoken to the youth consistently, single mindedly and innovatively, and that

is a position that they have never vacated Slogans like ‘Yeh Dil Maange More’, ‘Yehi hai

right choice baby’, ‘Yeh Pyaas Hai Badi’ or now ‘Oye Bubbly’, are made with the intent to

attract the youth .The idea is to look for catchy phrases that the youth would catch on to and

then make it part of their lives. Pepsi has had so many lines that have become consumer

currency; Bubbly was also intended to be likewise.

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 FOUR P ANALYSIS

PRODUCT:

WIDTH:

The Pepsi beverage division has the following product lines –

1. Soft Drinks

2. Juices (Tropicana)

3. Mineral Water

LENGTH:

Soft Drink Juices Mineral Water

Pepsi Tropicana Aquafina

Diet Pepsi Gatorade Mirinda

7 Up Mountain Dew

DEPTH:

We will focus on the soft drink section here. The Pepsi cola comes in various sizes ranging

from 300ml, 500 ml and 2 liters. In addition, Pepsi Cola is also available in 330ml cans.

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CONSISTENCY:

The different products in the soft drink section are all closely related. They share the same

distribution channel and are supplied in the same manner. They also have a similar

production process and the end users are by and large homogenous.

Pepsi cola has a light, crisp and refreshing taste. It is the perfect drink for the modern

“Generation Next” people. The product comes in 300ml glass bottles,500 ml pet bottles and

in 2 liters. The product targets the upwardly mobile with its trendy design and is a premium

product from the house of Pepsi. It has a shelf life of 6 months.

PRICE:

Pepsi’s pricing strategy is largely formulated by keeping its rivals, Coca-Cola, pricing

strategy in mind. The reverse is also true. Both the products are not differentiable and are

near perfect substitutes. Another important factor here is that the sales are volume driven;

hence price needs to be kept at an appropriate level. Listed below are the prices of the

variants –

1. 300 ml is for Rs 15.

2. 500 ml is for Rs 35

3. 1 Liter is for Rs 55

4. 2 Liters is for Rs 85

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PROMOTION:

The soft drinks market in the country relies heavily on promotion to sell its products. The

presence of close competition makes it necessary for both Pepsi and Coca-Cola to hard sell

their products. The leading products offered by both the companies are very similar. The

companies try aggressively to build loyalties for their respective brands by playing on

emotions and aspirations of its consumers. They have roped in cricket players and film stars

to attract and create interest in their products. Pepsi especially has been advertising using a

number of cricketers to associate Pepsi Cola with their success.

A Pepsi spokesperson says promotions have worked very well for the company and have

helped reinforce the brand personality.

The `Pepsi Cool Maal’ scheme in June-July 1998 targeted at school children met with a

phenomenal response because the premia comprised items that school kids needed and ``yet

had a lot of attitude''. The previous year, the company ran a `Pepsi Stuff' promotion that

offered young people a range of offers, both free and discounted, on cinema tickets, apparel,

music and so on.

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TV Ads – Pepsi has been bombarding the Indian customers with a periodical onslaught of

creative advertisements aimed at the youth of the country. Early on, Pepsi identified three

broad platforms cricket, movies and music. It has roped in the biggest stars from the film

industry and the cricketing fraternity. People endorsing Pepsi include Bollywood superstars

Amitabh Bachchan & Shah Rukh Khan with a host of other actors. Fardeen Khan, Saif Ali

Khan, Priety Zinta, Kareena Kapoor among the more popular ones.

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It has roped in most of the members of the national cricket team. From Superstar Sachin

Tendulkar to Rahul Dravid, Sorav Ganguly, Yuvraj Singh, Mohammed Kaif etc. Pepsi started

hiring cricket stars very early and set a trend in the market. It also brought international music

stars like Michael Jackson, Ricky Martin, Deep Purple and Def Leppard among others to the

country.

Pepsi began advertising early with its very effective ‘A-Ha’ campaign. A-Ha created a new

idiom. The tag line which was built into a song brought instant attention the product. Having

Remo Fernades sing “yehi hai right choice baby…a-ha” caught the attention of the youth.

Then came Akshay Kumar with the “I wanna be mast” campaign. Pepsi chose its

ambassadors in a manner which ensured curiosity and then lasting interest in the youth of the

country. Pepsi has over the years come up with catchy slogans like Generation Next, Yeh Dil

Maange More, The choice of a new generation etc.

Pepsi also associates itself with cricket which is by far the most popular activity, sport, mode

of entertainment in the country. It even launched a new brand by the name of ‘Pepsi Blue”

33
during the last cricket world cup to cash on the fact that the color of the players’ uniform is

blue. In an earlier episode of the same event where Pepsi had lost out to rival Coca-Cola in

gaining the official sponsorship, Pepsi came out with an aggressive and creative campaign,

where it positioned itself as the “unofficial drink” as opposed to coke’s strategy. It signed up

a number of national as well as international stars, mouthing the tag line “nothing official

about it”. The company has also time and again sponsored a number of cricket tournaments.

It recently came up with the ‘Toss ka Boss’ contest which saw fans join the two captains on

the field for the coin toss.

Pepsi also came out with a series of ads poking fun at rival Coke and its brand ambassadors.

This was done with a fair degree of success as it had everybody from the road side vendor to

the BBC correspondents talk about it. Another recent campaign which created controversy

was the ‘OYE BUBBLY’ campaign. It used a voice over which bore similarity to the voice of

Coke’s brand ambassador Virender Sehwag. Pepsi has created quite a stir with the ‘OYE

BUBBLY’ campaign. It shot a music video with Amitabh Bacchan, Sachin Tendulkar and

other players from the cricket team. It released an audio cassette and CD with the song on it.

This campaign in particular has been very successful thanks to the catchy tune and ads

featuring Shah Rukh Khan.

Internet – Pepsi signed up with Yahoo! India and launched a Pepsi zone on yahoo -

http://www.pepsizone.yahoo.co.in. The zone was aimed at the younger lot of the net surfers. A

number of features like contests, chat rooms, games, download etc. attracted net users.

34
 PLACE:

How does bottle of PEPSI reach you…

To bring the product to the consumer by proper distribution management to:

SUPER
MARKETS

HOSPITALS
EATERIES

ROAD
SIDE
SHOPS HOTEL
S

PLACE
MALLS

OFFICES

MOVIE
HALLS EUCATIONAL
INSTTUTES

GROCERIES

35
For distribution purpose Pepsi uses 2 level distribution channel which contain two

intermediaries between the bottling factory and the final consumer.

MANUFACTURER

DISTRIBUTOR

RETAILER

CONSUMER

The Company does its selling by using company owned distributors or franchisee owned

distributors. Worldwide Pepsi relies on franchisee but in India it uses both companies owned

and franchise owned operations.

Pepsi uses two methodologies for distribution in India

1. Company owned distributors

2. Franchise owned

FRANCHISEE OWNED: -

This is like outsourcing wherein the company out sources its distributing related work to

another party. Company has less control owner the distributor. All the investments like vehicles,

Employees’ salaries etc. are made by the distributor who in return gets a margin (around 18-

20%). Advantages of using this scheme is that the fixed investments and other distribution

36
related expenses of the company are less. The disadvantages are that the company has lesser

control over the distribution process. This method is followed in Delhi.

COMPANY OWNED: -

Here the company owns all the vehicles, the employees are on company roles. The

advantages of such a process is that the company has direct control over the entire

distribution process, it also gives the company higher flexibility. The disadvantages of such a

process are that it involves huge investments. This method is followed in Punjab.

Pepsi is currently available with the other Pepsi products at: -

➢ Convenience Stores

➢ Restaurants

➢ Grocers

➢ Entertainment Centers

➢ Offices and Institutions

➢ Eateries

➢ Educational Institutions

➢ Hotels

37
THE COLA WARS: -

No two companies could be more alike, or more different! Both have been selling products to

quench thirst for over a hundred years and both are now global brands. Their products moved

through the world’s most pervasive networks.

Distribution: -

Pepsi has taken the more capital-intensive route of owning and running its own bottling

factories alongside those of its franchisees whereas Coke operates only through FOBOs

(Franchise Owned Bottling Operations). Pepsi in India has a more organized streamlined

channel of distribution whereas Coca Cola is unorganized in its distribution channel. Pepsi

has over a hundred distributors (both companies owned and franchise owned) in Delhi alone

whereas Coke has much fewer distributors and relies more heavily on wholesalers directly for

their sales and distribution.

Brand Synchronization: Despite being a global brand, Pepsi has built its success on meeting

the Indian consumers’ needs. It has synchronized the brand with localized events and

traditions. For example, in Delhi, it linked its brand with Holi, offering sachets of color with

Pepsi Cola. In Chennai, it offered free bottles with orders of Idlis.

38
Whereas Coke, instead of creating a bond with its customers through small events, it chose to

associate itself with national and international mega events like the Cricket World Cup, 1996

and the Olympics, 1996.

Diversification: -

PepsiCo has increasingly diversified into snacks and restaurants while Coca Cola has focused

only on soft drinks. PepsiCo snack operation is in Frito-Lay and its restaurant business

includes Pizza Hut, Taco Bell and KFC. All of Coke’s profits come from beverages whereas

PepsiCo depends on drinks for 41% of its income.

QUALITY

The first reason is of quality, obviously in this competitive age and an intellig ent

consumer in front of you no company can afford to ignore the vital issue of quality.

PRICE

Why doing analysis 15% consumers complained about the price but from the general

tendency, it was seen that when a consumer felt thirsty and was in a company of

friends, price took a back seat and the consumers opted for their favorite brand.

SYSTEM

The distribution system of the company is very efficient. In fact, every day the trips are

made why the mini trucks, three wheelers caring crates are replac ed at the retail outlets

according to the demand.

39
LOCAL ADVERTISEMENT

The company has created brand awareness among the consumer through constant

advertising. The retail outlets in the various part of the city display various

advertising themes, bill-boards are painted with eyes catching advertisements,

moreover, the mini trucks caring the crates of soft drink are beautifully painted with

various brands and a part from the local newspaper carry the advertising captions

periodically.

REDDRESSING CONSUMER

COMPLAINTS; the company has established a system that keeps track of consumer

complaints. It has well set-up network which contacts retailers, consumers, records and

their views about the products, the quality, availability of soft dri nk in time, price etc.

40
 RESEARCH METHODOLOGY

Research Design

The purpose of the methodology is to design the research procedure. This includes the overall
design, the sampling procedure, the data collection method and analysis procedure.
Marketing research is the systematic gathering recoding and analyzing of data about problem
retaining to the marketing of goods and services.
The essential purpose of marketing research is to provide information, which will facilitate
the identification of an opportunity of problem situation and to assist manager in arriving at
the best possible decisions when such situations are encountered.
Basically, there are two types of researches, which according to their applicability, strength,
weaknesses, and requirements used before selecting proper type of research, their suitability
must be seen with respect to a specific problem two general types of researches are
exploratory and conclusive.

Conclusive Research

It is also known as quantitative research; it is designed to help executives of action that is to

make decision.
When a marketing executive makes a decision are course of action is being selected from
among a number of available. The alternatives may be as few as two or virtually infinite.
They may be well defined or only vaguely glimpsed.
Conclusive research provides information, which helps the executives make a rational
decision. In some instances, particularly if any experiment is run, the research may come
close to specifying the precise alternatives to choose, in their cases especially with descriptive
studies the research will only particularly clarify the situation and much will be left to the
executive’s judgment.

41
The type of research here is “Descriptive Research Design”. This kind of design is used for
more precise investigation or of developing the working hypothesis from an operational point
of view. It has inbuilt flexibility, which is needed because the research problem, broadly
defined initially, is transformed into one with more precise meaning in exploratory studies,
which in fact may necessitate changes in research procedure for gathering relevant data.

The characteristic features of research are as follows: -

➢ Flexible Design
➢ Non-Probability Sampling Design
➢ No pre-planned design for analysis
➢ Unstructured instruments for collection of data
➢ No fixed decisions about the operational procedures

Sample Size

Sample size refers to the numbers of respondent’s researcher have selected for the survey.
I have selected 50 sample units from market and individual customers.

Sampling Technique

The sample design provides information on the target information and final sample sizes. I
used convenient sampling surveyed in research.

Sampling Area:

While conducting sample, I went many places of New Delhi areas- Sarita Vihar, New Friends
Colony, Lajpat Nagar, Badarpur.

42
Data Collection Tool

I have used Questionnaire, as the research instrument to conduct the market survey. The
questionnaire consisted closed ended questions designed in such a way that it should gather
maximum information possible.

The questionnaire was a combination of 15 questions. If choices are given it is easier for the
respondent to respond from the choices rather, they think and reply also it takes lesser time.
Because the keep on responding and one has tick mark the right choice accordingly.
Data was collected through two sources:
Primary Source: Primary data was collected directly from the customers through a
questionnaire.
Secondary Source: The secondary source was the company website and my colleagues.

Method of Sampling

Convenient sampling is used to do sampling as all the customers in the sites are Surveyed.

Data Analysis

Data analysis was done mainly from the data collected through the customers.
The data collected from secondary sources is also used to analyze on one particular
parameter.
Qualitative analysis was done on the data collected from the primary as well as secondary

Sources.

43
 DATA ANALYSIS & INTERPRETATION

DEMOGRAPHIC PROFILE OF THE RESPONDENTS

1. Age

Age % of respondents No. of respondents

18-25 40% 40

26-35 35% 35

36-50 13% 13

Above 50 12% 12

Sales

12.00%

13% 40% 18-25

26-35
36-35
Above 50

35.00%

Interpretation: -

40% of the respondents are between the age group 18 – 25.

35% of the respondents are between the age group 26 – 35.
13% of the respondents are between the age group 36 – 50
12% of the respondents are above 50 years of age.

44
 2. Do you consume soft drinks?

(A) YES
(B) NO

Responses % of respondents No. of respondents

Yes 83% 100

No 17% 0

Sales
0 0

17%

Yes
No

83%

Interpretation: -

83% of the respondents are Soft drink consumers.

13% of the respondents are non-Soft drink consumers.

45
 3. Which soft drinks do you prefer?

(A) Pepsi
(B) Coca Cola
(C) Sprite
(D) Others

Soft Drinks % Of respondents No. of respondents

Pepsi 32% 32

Coca Cola 28% 28

Sprite 26% 26

Others 14% 14

Sales

16.00%
32.00% Pepsi
Coca Cola

26.00% Sprite
Others

28.00%

Interpretation: -

32% of respondents prefers Pepsi

28% of respondents prefers Coca Cola
26% of respondents prefers Sprite
16% of respondents prefers other drinks

46
 4. Why do you prefer the above-mentioned brand?

(A) Taste
(B) Price
(C) Availability
(D) Status

Preference % of respondents No. of respondents

Taste 33% 33

Price 10% 10

Availability 32% 32

Status 25% 25

Sales

25.00% 33% Taste

Price
Availability
Status
32%
10.00%

Interpretation: -

33% of respondents prefers Pepsi because of it’s taste.

10% of respondents prefers Pepsi because of it’s price
32% of respondents prefers Pepsi because of it’s availability
25% of respondents prefers Pepsi because of it’s status

47
 5. What is your average monthly expenditure on soft drinks (in RS)?

(A) Rs 100-Rs 200

(B) Rs 200-Rs 300
(C) Rs 300-Rs 400
(D) Above Rs 500

Expenditure (Rs) % of respondents No. of respondents

Rs 100-Rs 200 26% 26

Rs 200-Rs 300 42% 42

Rs 300-Rs 400 22% 22

Above Rs 500 10% 10

Sales
10.00%

26.00% Rs 100-Rs 200

22.00% Rs 200-Rs 300
Rs 300-Rs 400
Above Rs 500
42.00%

Interpretation: -

26% of respondents spend Rs 100-Rs 200 monthly.

42% of respondents spend Rs 200-Rs 300 monthly.
22% of respondents spend Rs 300-Rs 400 monthly.
10% of respondents spend above Rs 500 monthly.

48
 6. How often do you purchase soft drinks?

(A) Daily
(B) Weekly
(C) Twice a month
(D) Monthly

Purchases % of respondents No. of respondents

Daily 22% 22
Weekly 32% 32
Twice a month 36% 36
Monthly 10% 10

Sales

10.00%
22.00%
Daily
Weekly

36.00% Twice a month

Monthly
32.00%

Interpretation: -

22% of respondents purchase soft drinks daily

32% of respondents purchase soft drinks weekly
36% of respondents purchase soft drinks twice a week
10% of respondents purchase soft drinks monthly

49
 7. Which pack do you mostly purchase?

(A) 250 ml
(B) 500 ml
(C) 1 liter
(D) 2 liters

Packs % of respondents No. of respondents

250 ml 10% 10

500 ml 38% 38

1 Liter 40% 40

2 Liters 12% 12

Sales
10.00%

12%

250 ml
500 ml
1 Litre
38.00%
40.00% 2 Litres

Interpretation: -
10% of respondents mostly purchase 250 ml pack
38% of respondents mostly purchase 500 ml pack.
40% of respondents mostly purchase 1 Liter pack
12% of respondents mostly purchase 2 Liters pack

50
 8. Is your preferred brand easily available at your doorstep?

(A) Yes
(B) No

Availability % of respondents No. of respondents

Yes 100% 100

No 0% 0

Sales

Yes No

100.00%

Interpretation: -

100% of respondents have brand availability in their area.

0% of respondents have brand non availability in their area.

51
 9. With what edible you like to consume soft drinks?

(A) Snacks
(B) Fast Foods
(C) Lunch
(D) Dinner

Services % of respondents No. of respondents

Snacks 45% 45

Fast Foods 25% 25

Lunch 18% 18

Dinner 12% 12

Sales
12.00%

Snacks

18.00% 45% Fast Foods

Lunch
Dinner
25.00%

Interpretation: -

45% of respondents consume soft drinks with Snacks.

25% of respondents consume soft drinks with Fast Foods
18% of respondents consume soft drinks with Lunch.
12% of respondents consume soft drinks with Dinner

52
 10. Do you find any difference in tastes of Pepsi and other soft drink brands?

(A) Yes
(B) No

Tastes % of respondents No. of respondents

Yes 84% 84

No 16% 16

Sales

16.00%
Yes
No

84.00%

Interpretation: -

84% of respondents find change in tastes of Pepsi and other soft drinks.
16% of respondents do not find change in tastes of Pepsi and other soft drinks.

53
 11. Are you satisfied with the quality of Pepsi?
(A) Yes
(B) No

Satisfaction level
% Of respondents No. of respondents

Yes 82% 82

No 18% 18

Sales

18.00%

Yes
No

82.00%

Interpretation: -

65% of respondents are satisfied.

35% of respondents are not satisfied.

54
 12. Would you recommend Pepsi to others?

(A) Yes
(B) No

Recommendation % Of respondents No. of respondents

54%
Yes 54

No 46% 46

Sales

yes
46.00% No

54.00%

Interpretation: -

54% of respondents would recommend Pepsi to others.

46% of respondents would not recommend Pepsi to others.

55
 13. Do you like the advertisement of Pepsi?

(A) Yes
(B) No

Likes % Of respondents No. of respondents

Yes 97% 97

No 3% 3

Sales
3.00%

Yes
No

97.00%

Interpretation: -

54% of respondents like the advertisement of Pepsi

46% of respondents do not like the advertisement of Pepsi

56
 14. Rate the following services of the Pepsi on basis of your satisfaction?

Services Excellent Very Fairly Average Poor

good good

Taste ✓

Advertisement ✓

New schemes ✓
and offers

Supply of the ✓
product

Customer ✓
Satisfaction

57
 CONCLUSION

After completion of the project and the analysis of the study I came to conclude that

after launching the promotion there was drastic percentage jump in sales initially but

gradually the percentage jump decreased and there isn’t much impact on sales.

After doing analysis of Pepsi I came to conclude that people are very much aw are

about the promotions especially the kids and people prefer more of Pepsi and Pepsi

is very popular in India.

Thus, I conclude that the industries have pampered consumers by giving discounts

and free bias and hence consumers now a days don't buy a product until and unless

they are given some discounts. So, the industries should not over do the promotions.

Critics argue that promotions simply prepone the purchase and don't add any

incremental value to it. The sales may pick up during the offer, but t here is a loss of

sale in the following month, which means the people who buy the goods in July

simply preponed their purchase due to the offer". Also, over promoted products

often leave customers asking for more. Thus, promotions have actually spoilt the

habits of consumers. Thus, promotion is a very attractive means to keep the

consumers glued to its product but then the industry shouldn't overdo it. The effect

of promotions is for a short period of time.

58
 RECOMMENDATIONS

1. PepsiCo should Promote their all products like Alivio, Gatorade and
Quaker Oats

2. PepsiCo should promote their product in Rural area also as Coca-Cola is doing.

3. PepsiCo should expand the Brand Image of Pepsi (People are only correlating
it with youth- Youngistan)

4. As Coca- Cola shows its logo at the end of every advertisement of its each
product/Brands, so Pepsi should also show its logo in its each Brands advertisement

5. PepsiCo also should go equally to other medium of advertisement like pepper,

hording and internet.

6. PepsiCo should also continuous participate in Sporting events.

7. PepsiCo can take part in IPL also

8. PepsiCo should also focus on Green marketing like other

9. Companies doing like- Idea, Aircel etc.

10. PepsiCo mostly Brand ambassador came from Bollywood so they should focus on
Sporting celebrity like from cricket, football and hockey

11. People are not that much aware about some products of PepsiCo so they should focus
on it.

12. The regular user of Pepsi is very low. So, Pepsi have to convert those customers
which are aware about Pepsi but not using it regularly, so try to make them brand
loyal

13. Buying priority of most customers is refreshment so they should try to convert them
in brand preference.

14. They should more target on Child and Sports men

15. They should show Quality and Trust base in their advertisement.

16. PepsiCo should focus on their brand ambassador they are changing it continues so
they should take care of it

59
 SUGGESTIONS

 Company should emphasis on selling per bottles for 200ml & 300ml at a lower

difference price; it is portable and convenient to carry.

 Consumer preference change according to availability; therefore, the company

should provide their brands at maximum outlets at possible.

 Company should take care of cleanliness of the bottles rusted crown and maintain

the quality of the product especially at the time of packaging.

 Company should get the schemes printed on the labels of the bottles/products as

well as on the free items provided with soft drink so that consumer gets aware

about the schemes and not cheated by the retailers

 Company should inform each and every outlet about the schemes before time or

on time and check them. Weather they are providing them to consumer in the

proper manner.

 Company should conduct survey quarterly to see whether consumers are satisfied

with the product and services.

 Schemes have large impact on consumer preference therefore a company should

launch different and attractive promotional schemes frequently.

 Company should encourage to the consumers to purchase mor e and softer drinks

so as to develop the taste and sales.

60
 ANNEXURE

NAME: ------------------------------------
AGE: ------------------------------------
SEX: ------------------------------------
OCCUPATION: ------------------------------------
MOBILE NO: ------------------------------------
ADDRESS: ------------------------------------

QUESTIONNAIRE

1. Age of the respondent?

(A) Between 18-25

(B) Between 26-35
(C) Between 36-50
(D) Above 50

2. Do you consume soft drinks?

(A) Yes
(B) No

3. Which soft drinks do you prefer?

(A) Pepsi
(B) Coca Cola
(C) Sprite
(D) Others

61
4. Why do you prefer the above-mentioned brand?

(A) Taste
(B) Price
(C) Availability
(D) Status

5. What is your average monthly expenditure on soft drinks (in RS)?

(A) Rs100-Rs200
(B) Rs200-Rs300
(C) Rs300-Rs400
(D) Above Rs500

6. How often do you purchase soft drinks?

(A) Daily
(B) Weekly
(C) Twice a month
(D) Monthly

7. Which pack do you mostly purchase?

(A) 250 ml
(B) 500 ml
(C) 1 Liter
(D) 2 Liters

8. Does your preferred brand easily available at your doorstep?

(A) Yes
(B) No

62
9. With what edible you like to consume soft drinks?

(A) Snacks
(B) Fast foods
(C) Lunch
(D) Dinner

10. Do you find any difference in tastes of Pepsi and other soft drink brands?

(A) Yes
(B) No

11. Are you satisfied with the quality of Pepsi?

(A) Yes
(B) No

12. Would you recommend others?

(A) Yes
(B) No

13. Do you like the advertisement of the brand?

(A) Yes
(B) No

63
 14. Rate the following PepsiCo services on basis of your satisfaction?

Services Excellent Very Fairly Average Poor

Good Good
Taste

Advertisement

New schemes
and offers
Supply of the
product
Customer
Satisfaction

64
 BIBLIOGRAPHY

 Food & Drink Weekly

 Annual Report - Pepsi

 A&M

 BUSINESS WORLD

 INDIA TODAY

 NEWS PAPERS

 INTERNET

 www.pepsico.com

 www.agencyfaqs.com

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