RURAL

1. ACKNOWLEDGEMENT

2. CERTIFICATE

3. EXECUTIVE SUMMARY

4. OBJECTIVE

5. COMPANY OVERVIEW

6. RESEARCH METHODOLOGY

7. SOFT DRINK MARKET IN INDIA

8. BUYER DECISION PROCESS

9. PEST ANALYSIS

10. SWOT ANALYSIS

11. ANSOFF MATRIX

12. PORTER’S FIVE FORCE MODEL

13. STP ANALYSIS

14. FOUR P ANALYSIS

15. THE COLA WARS

18. CONCLUSION AND RECOMMENDATION

19. BIBLIOGRAPHY

ACKNOWLEDGEMENT

I owe a great many thanks to a great many people who helped and supported me during the writing of this
project.
My deepest thanks to Assistant Professor, Mr. Gautum Nagi the Guide of the project for guiding and
correcting various documents of mine with attention and care. She has taken pain to go through the project
and made necessary correction as and when needed.
I express our thanks to the Director Dr. Chavi Sharma, FACULTY OF MANAGEMENT STUDIES,
FARIDABAD for extending her support.
My deep sense of gratitude to all who provided support and guidance. Thanks and appreciation to the helpful
people for their support.
I would also like to thank my Institution and my faculty members without whom this project would have
been a distant reality. I also extend my heartfelt thanks to my family and well wishers.

ROLIKA SETH
 CERTIFICATE

OBJECTIVE

1. The main purpose of this study is determine 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

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.

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

 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.”

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

7 Up

Mirinda

Mountain Dew

Slice

Tropicana Juices

Aquafina

Leher Everess Soda, Dukes Lemonade and Mangola

There is a subdivision of the Beverages division which is under the name of Tropicana Products, Inc., parent

company headquartered in Bradenton, Florida, and is a division of PepsiCo. In India, the company is

headquartered in Gurgaon, Haryana.

Keeping with the core Pepsi thrust toward youth, Tropicana is dedicated to producing pure premium juices

essential for an active and youthful lifestyle. The juices of the commonly available fruits produced, packaged

and marketed by Tropicana contain naturally occurring components to promote good health.

With a 50-plus year history of consistent growth Tropicana today stands as the world’s only global citrus

juice business!
 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.

 RESEARCH METHODOLOGY

1. TOOLS OF RESEARCH
2. RESOURCE OF DATA
 A Research Methodology defines the purpose of the research, how it proceeds, how to measure
progress and what constitute success with respect to the objectives determined for carrying out the
research study.

The appropriate research design formulated is detailed below.

 Exploratory research: this kind of research has the primary objective of development of insights into
the problem. It studies the main area where the problem lies and also tries to evaluate some appropriate
courses of action.

 The research methodology for the present study has been adopted to reflect these realties and help
reach the logical conclusion in an objective and scientific manner.

The present study contemplated an exploratory research

NATURE OF DATA

SECONDARY DATA

Secondary data that is already available and published .it could be internal and external source of data.
Internal source: which originates from the specific field or area where research is carried out e.g. publish
broachers, official reports etc.

EXTERNAL SOURCES

This originates outside the field of study like books, periodicals, journals, newspapers and the Internet.

DATA COLLECTION

Secondary data has been used which is collected through articles, reports, journals,
magazines, newspapers reports prepared by research scholars, universities and internet
 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 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.

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.

 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.

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 a 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 through out 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.

SWOT ANALYSIS

Strengths Weakness

High Brand Awareness Powerful Franchisee

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

Opportunity Threats

Per caps 8 oz in India vis a vis Controversies

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

 High brand awareness: - Pepsi is the worlds most famous #2 multi billion dollar brand and Pepsi is the

largest FMCG brand in India.

 Large number of distributors: - The company has both franchise 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.

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 by 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.

 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 pani 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 loosing market share since both the products are very similar and

there is almost no brand loyalty present amongst consumers

ANSOFF MATRIX

Below is the Ansoff Matrix which helps us to analyse product-market expansion. PepsiCo India is basically

pursuing the Product Development strategy.

 Current New

Product Product

Market Penetration Product Development

– No Change in – Product modification

Product with or without a new brand

name
– No Change in

Market Potential – No change in Market

Potential

Market Development Product Diversification

– No Change in – Product modification

Product with or without a new brand

name
– Change in

Market Potential – Change in Market

Potential

On her second visit to India since she assumed the president and CFO's job in the PepsiCo three years back,

Indra Nooyi announced her India strategy on Tuesday that will involve an investments of $300 million to

$500 million over the next 3 years to 5 years. The strategy also includes introduction of newer products in

the country. About 60 percent of Pepsi's fresh investment would be spent on beverage business to expand the

beverage portfolio and provide a range of choices.

 Threat of Substitutes
 Switching Cost to substitute is
very low
 Price – performance Trade off
of substitutes
 Brand loyalty does not exist

PORTERS FIVE FORCE MODEL

Barriers to Entry Barriers to entry:

 High capital investment required
 Strong distribution network of
existing players
 Strong Brands existing The soft drinks industry requires
 Economies of Scale
a huge investment if one aspires

to gain a considerable market

share. The investment would

Bargaining power of
Suppliers
 No substitute for critical
Inputs
 Switching cost from one
supplier to other is high
 Supplier integrating forward
for higher prices and margins
Rivalry among existing firms
 Exit barrier
 Industry Growth
 Industry Concentration
 Diversity of rivals
 Price competition
 Product differences
Bargaining power of
Buyers require huge sums of
 Availability of many
brands
 Price sensitivity money to setup
 Buyer Information
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.

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.

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
Age wise consumption pattern

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

TARGETING

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

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

that they have never vacatedSlogans 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.

 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 litres. In addition Pepsi Cola is also available in 330ml cans.

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 9.

2. 500 ml is for Rs 18

3. 2 litre is for Rs 43

4. 330 ml can for Rs 20

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.

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 Bacchan & Shah Rukh Khan with a host of

other actors. Fardeen Khan, Saif Ali Khan, Priety Zinta, Kareena Kapoor among the more popular ones.
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” 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
 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

For distribution purpose pepsiGROCERIES

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 company 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 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 suh a process are 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

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 company owned

and franchise owned) in Delhi alone whereas Coke has much fewer distributors and relies more heavily on

wholesellers directly for their sales and distribution.

Brand Synchronisation: 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 colour with Pepsi Cola. In Chennai, it offered free bottles

with orders of idlis.

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.

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 aware 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 bies 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 there 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 over do it. The effect of promotions is for a shot

period of time.

QUALITY

The first reason is of quality, obviously in this competitive age and an intelligent 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 replaced at the retail outlets according to the

demand.

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 news paper 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 drink in time, price etc.

RECOMMENDATIONS

1.PepsiCo should Promote their all products like Alvio, 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

Companies doing like- Idea, Aircel etc.

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

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

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

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

13. They should more target on Child and Sports men

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

15. PepsiCo should focus on their brand ambassador they are changing it continues so they should take care
of it
 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 weather 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 more and softer drinks so as to develop

the taste and sales.

BIBLIOGRAPHY

 Food & Drink Weekly

 Annual Report - Pepsi

 A&M

 BUSINESS WORLD

 INDIA TODAY

 NEWS PAPERS

 INTERNET

 www.pepsico.com

 www.agencyfaqs.com

 www.domain-b.com