Professional Documents
Culture Documents
PEPSI
Submitted By: Shaeeb mohd khanday Roll no: RT1903B53 REG. no: 10907126 Section: RT1903
Under The Guidance: Internal Guide: - Mr. Abishek Dutta External Guide: - Mr. Pawan Gaur
ACKNOWLEDGEMENT
We think if any of us honestly reflects on who we are, how we got here, what we think we might do well, and so forth, we discover a debt to others that spans written history. The work of some unknown person makes our lives easier every day. We believe it's appropriate to acknowledge all of these unknown persons; but it is also necessary to acknowledge those people we know have directly shaped our lives and our work. First of all we would like to thank our teacher Mr. Amit Lal for their guidance throughout the semester. Then we would like to thank Mr. B.P Chauhan, Mr. Pawan Gaur, Mr Vishal khosla and Abishek Dutta for providing us the information that was required for completion of this project. I express my thanks to Varun Beverages Ltd for granting me the permission to work with the esteem organization. I am also thankful to Mr. Pawan Gaur (C.E.), Varun Beverage Ltd. who guided and helped me in all possible ways they could, at every stage of the project. I would also like to thank all the SAN BEVERAGES Executives, distributors & staff of dehradun area who provided me all the relevant information and their kind support, on the basis of which this report has been prepared. Shaeeb mohd khanday
EXECUTIVE SUMMARY
Analyzing the marketing Strategy of PEPSI and COCA COLA in DEHRADUN
Channels of distribution are an important aspect of marketing strategy. Channels chosen for the companys products effect every other marketing decision.
On 14th of June I start my project under the guidance of Mr. BP Chauhan(TDM) /Mr.Pawan Gaur (M.E.)Dehradun. I have been allocated the area for survey in Dehradun. Market Area of Dehradun :1: Sahastradhara Road 2: Patel Nagar 3: Upper Rajpur 4: Lower Rajpur 5: Chakrata road 6: GMS road 7: Haridwar road 8: Gandhi road 9: ISBT road 10: Kola garh 11: Hathi Barkala 12: Kavli road 13: EC road 14: Main Sahastradhara 15: Nehru colony 16: Niranjan pur 17: Nobawala
PREFACE
Marketing plays pivotal role in todays business scenario in consumer product Company, when there is such a high competition in the market.
The emphasis in the project is providing the study and an insight into Indian FMCG Business Scenario. The Summer Project is designed to provide participation of MBA program as on the job experience. This has given a chance to try and apply the academic knowledge and gain insight into corporate culture. This helps in developing decision-making abilities and emphasizes on active participation by the student.
I undertook my Project in Varun Beverages, a leading Bottler and Marketing partner of the Pepsi Foods. During the training, I had worked on the project analysis of marketing strategy of PEPSI and COCA COLA in Dehradun.
I gained valuable experience & knowledge during the survey. The Project consists of my findings after data analysis & conclusions were drawn and finally recommendations were put forward.
Table of Contents Chapter 1: Introduction to beverage industry Chapter 2: Industrial leaders (coca cola & Pepsi) Chapter 3: Segmentation of market Chapter 4: Product mix Chapter 5: Branding Chapter 6: Positioning and Promotion Chapter 7: Pricing strategy Chapter 8: Distribution channel Chapter 9: Social responsibility marketing Chapter 10: SWOT analysis of Pepsi and coke Chapter 11: Research methodology
1.1.1 WATER Despite the fact that most beverages, including juice, soft drinks, and carbonated drinks, have some form of water in them; water itself is often not classified as a beverage, and the word beverage has been recurrently defined as not referring to water but the bottled water that is processed through proper filtration and purification comes under the beverage category.
1.1.2 ALCOHOLIC BEVERAGES An alcoholic beverage is a drink containing ethanol, commonly known as alcohol, although in chemistry the definition of an alcohol includes many other compounds. Ethanol (alcohol) is a psychoactive drug that has a depressant effect. Alcoholic beverages are divided into three general classes:
Beers: The two main types of beer are ale and lager; each type has a distinct production processes. Mass-produced beer is typically aged for only a week or two after its fermentation and has an alcohol content of 4%6% ABV. Other kinds of beer may be fermented and aged for several months.
Wines: Wine involves a longer (complete) fermentation process and a long aging process (months or years) that results in an alcohol content of 9%16% ABV. Sparkling wine can be made by adding a small amount of sugar before bottling, which causes a secondary fermentation to occur in the bottle.
Spirits: Unsweetened, distilled, alcoholic beverages that have an alcohol content of at least 20% ABV are called spirits. Spirits are produced by distillation of a fermented product; this process concentrates the alcohol and eliminates some of the congeners.
1.1.2 NON-ALCOHOL BEVERAGES A non-alcoholic beverage is a beverage that contains no alcohol. Non-alcoholic mixed drinks (including punches, "virgin cocktails", or "mock tails") are often consumed by children; people whom wishing to enjoy flavorful drinks without alcohol. Non-alcoholic beverages contain no more than .5 percent alcohol by volume. It also includes drinks that have undergone an alcohol removal process such as non-alcoholic beers and de-alcohol zed wines. Non-alcoholic variants: Low Alcohol Beer Non-Alcoholic Wines Sparkling Ciders
1.1.3 SOFT DRINKS A soft drink is a beverage that does not contain alcohol. The name "soft drink" specifies a lack of alcohol by way of contrast to the term "hard drink". The term "drink", while nominally neutral, sometimes carries connotations of alcoholic content. Beverages like colas, flavored water, sparkling water, iced tea, lemonade, squash, and fruit punch are among the most common types of soft drinks. Many carbonated soft drinks are optionally available in versions sweetened with sugars or with non-caloric sweeteners.
1.1.4 HOT BEVERAGES Coffee-based beverages: Cappuccino, Coffee Espresso, Caf au lait, Frappe, Flavored coffees (mocha etc) Hot chocolate: It is a heated beverage that typically consists of shaved chocolate or cocoa powder, heated milk or water, and sugar.
Hot cider: It is an alcoholic beverage usually made from the fermented juice of apples, although pears are also used. In the United Kingdom, pear cider, which has no apple content, is known as Perry.
Tea-based beverages: Tea, Green Tea, Flavored Tea, Pearl Milk Tea Herbal teas: An herbal tea, tisane, or ptisan is an herbal infusion made from anything other than the leaves of the tea bush (Camellia sinensis). Originated from both China and Middle East
1.1.5 OTHERS Some substances may either be called food or drink, and accordingly be eaten with a spoon or drunk, depending on solid ingredients in it and on how thick it is, and on preference: Soups: Soup is a food that is made by combining ingredients such as meat and vegetables in stock or hot/boiling water, until the flavor is extracted, forming a broth. Yogurt: yoghurt is a dairy product produced by bacterial fermentation of milk. Fermentation of the milk sugar produces lactic acid, which acts on milk protein to give yoghurt its texture and its characteristic tang. Soy yoghurt, a dairy yoghurt alternative, is made from soymilk.
Buttermilk: It is a fermented dairy product produced from cows' milk with a characteristically sour taste. The product is made in one of two ways. Originally, buttermilk was the liquid left over from churning butter from cream. In India, buttermilk, widely known as "chaas" is known to be the liquid leftover after extracting butter from churned curd.
In 1902, he launched the Pepsi-Cola Company in the back room of his pharmacy, and applied to the U.S. Patent Office for a trademark. At first, he mixed the syrup himself and sold it exclusively through soda fountains. But soon Caleb recognized that a greater opportunity existed to bottle Pepsi so that people could drink it anywhere. The business began to grow, and on June 16, 1903, "Pepsi-Cola" was officially registered with the U.S. Patent Office. That year, Caleb sold 7,968 gallons of syrup, using the theme line "Exhilarating, Invigorating, Aids Digestion." He also began awarding franchises to bottle Pepsi to independent investors, whose number grew from just two in 1905, in the cities of Charlotte and Durham, North Carolina, to 15 the following year, and 40 by 1907. By the end of 1910, there were Pepsi-Cola franchises in 24 states. Pepsi-Cola's first bottling line resulted from some lessthan-sophisticated engineering in the back room of Caleb's pharmacy. Building a strong franchise system was one of Caleb's greatest achievements. Local Pepsi-Cola bottlers, entrepreneurial in spirit and dedicated to the product's success, provided a sturdy foundation. They were the cornerstones of the Pepsi-Cola enterprise. By 1907, the new company was selling more than 100,000 gallons of syrup per year. Growth was phenomenal, and in 1909 Caleb erected a headquarters so spectacular that the town of New Bern pictured it on a postcard. Famous racing car driver Barney Oldfield endorsed Pepsi in newspaper ads as "A bully drink...refreshing, invigorating, a fine bracer before a race." The previous year, Pepsi had been one of the first companies in the United States to switch from horse-drawn transport to motor vehicles, and Caleb's business expertise captured widespread attention. He was even mentioned as a possible candidate for Governor. A 1913 editorial in the Greensboro Patriot praised him for his "keen and energetic business sense." Pepsi-Cola enjoyed 17 unbroken years of success. Caleb now promoted Pepsi sales with the slogan, "Drink PepsiCola. It will satisfy you." Then Came World War I, and the cost of doing business increased drastically. Sugar prices see sawed between record highs and disastrous lows, and so did the price of producing Pepsi-Cola. After seventeen years of success, Caleb Bradham lost Pepsi Cola. He had gambled on the fluctuations of sugar prices during WORLD WAR I, believing that sugar prices would continue to rise but they fell instead leaving Caleb Bradham with an overpriced sugar inventory. Pepsi Cola went bankrupt in 1923.In 1931, the Loft Candy Company Loft president, Charles G. Guth who reformulated the popular soft drink, bought Pepsi Cola.
In 1940, history was made when the first advertising jingle was broadcast nationally. The jingle was "Nickel Nickel" an advertisement for Pepsi Cola that referred to the price of Pepsi and the quantity for that price. "Nickel Nickel" became a hit record and was recorded into fifty-five languages. In 1965 Pepsi-cola Company and Frito-Lay, Inc. merged which result in the formation of today knows PepsiCo Inc.
2.1.1
ORGANIZATION STRUCTURE
VARUN BEVERAGES LTD.
UNIT MANAGER
GENERAL MGR.
PRODUCTION MGR.
MANAGER
SHIPPING MGR.
MARKETING EXE
CUSTOMER EXE
TRANSPORT MGR.
SALESMAN
2.2
Coca-Cola started out as an insignificant one-man business and over the last one hundred and ten years has grown into one of the largest companies in the world. Dr. John Pemberton, an Atlanta pharmacist, invented Coca-Cola. He concocted the formula in a three-legged brass kettle in his backyard on May 8, 1886. He mixed a combination of lime, cinnamon, coca leaves, and the seeds of a Brazilian shrub to make the fabulous beverage. Coca-Cola debuted in Atlanta's largest pharmacy, Jacob's Pharmacy, as a five-cent noncarbonated beverage. Later on, the carbonated water was added to the syrup to make the beverage that we know today as Coca-Cola In the mid1970, more than half Coca-Cola sold was outside of the U.S. Coca-Cola products outsell closest competitor by more than two to one. One in every two cola and one in every three soft drinks is a Coca-Cola product. The best-known trademark in the world is sold in about one hundred and forty countries to 5.8 billion people in eighty different languages. This is why Coca-Cola is the largest soft drink company in the world. For more than 65 years, Coca-Cola has been a sponsor of the Olympics. Advertisements for Coca Cola started on the radio in the 1930s and on the television in 1950. Currently Coca-Cola is advertised on over five hundred TV channels around the world.
2.3 MARKET SHARE IN INDIA These two soft drink companies (Coca cola & Pepsi) acquire the major share of the soft drink Industry and always remain in the war to get the majority of market share with each other. These companies always be pioneer in using various innovative technology and method to become the market leader. These companies present the world new innovative ways of doing the marketing and how take advantage of various opportunities and how to use your strength in a better way. In India currently colas (carbonated soft drinks) products comprises 61% and non-cola segment constitutes 36% of the total soft drink market whereas 2% is covered under other various drinks like apple juice, cold coffee, cold tea etc.
2.4 OPPORTUNITY IN INDIAN MARKET As in India, around 120 billion litres of beverage is consumed every year, of which only 5 percent are in packaged segment and also if we compare per head consumption of soft drink in India to America it is 6 is to 700. So looking at these aspects we can say that there is lot of scope for these two soft drink giant in India to expand their market as the stakes are huge in Indian market.
3.2.1 GEOGRAPHICAL
3.2.1.1 REGION Both companies treat hot countries such as Asia, Middle East and African differently in comparison to cold countries. As in tropical countries, consumption of soft drinks is 70% in summer and 30% in winter season while in EUROPEAN countries its consumption is almost uniform. So soft drink companies prefer different marketing strategies in Asian and European countries. In countries like India and Pakistan, these companies invest huge resources in the season of summers, and their target area is domestic users, restaurants, school and college canteens and even rural chaupals. While in winter season their target is mainly party users and high-income group consumers.
3.2.1.2 RURAL VS. URBAN MARKET Coca-Cola Company is one of the first global majors to have spotted the potential spin offs from the countrys rural market. Population of Rural sector is more conscious more about the price whereas Population of Urban sector is more conscious about the quality and brand name of the product. So Coca cola and PepsiCo in Year 2002 bring the 200 ml bottle at Rs.5 specifically targeted at the rural sector so that soft drink can take place of the local drink like lemon, sugarcane juice and Tea etc. Both the companies Coca-Cola and PepsiCo have adopted different marketing strategy for rural and urban areas
The Coca-Cola Company has more than 2800 products in over 200 countries. From Inca Kola, a sparkling beverage found in North and South America, and Samurai, energy drink available in Asia; to Vita, an African juice drink, and Bon Aqua, water found on four continents, their product variety spans the globe The various products of Coca-Cola available in India are: Coca-Cola: Coca-Cola is the most popular and biggest-selling soft drink in history, as well as the best-known product in the world. Available in the following flavors: Cola, Cola Green Tea, Cola Lemon, Cola Lemon Lime, Cola Lime, Cola Orange and Cola Raspberry.
Diet Coke: Diet Coke was born in 1982. Diet Coke is the drink for people who want no calories, but plenty of taste. Known as Coca-Cola light in some countries, it's now the No.3 soft drink in the world. Available in the following flavors: Black Cherry Cola Vanilla, Cola, Cola Green Tea, Cola Lemon, Cola Lemon Lime, Cola Lime, Cola Orange and Cola Raspberry Fanta:Fanta was introduced in the United States in 1960. Consumers around the world, particularly teens, fondly associate Fanta with happiness and special times with friends and family. This positive imagery is driven by the brand's fun, playful personality, which goes hand in hand with its bright color, bold fruit taste and tingly carbonation. Kinley: Kinley is a carbonated water that comes in wide array of variants such as tonic, bitter lemon, club soda and a myriad of fruit flavors. Available in the following flavors: Apple Peach, Bitter Grapefruit, Bitter Herbal, Bitter Lemon, Bitter Water, Blueberry Pomegranate, Club Soda, Ginger Ale, Lemon and Raspberry Limca: This thirst-quenching beverage features a fresh, light lemon-lime taste and fun loving attitude. It's a homegrown, national treasure in India that is acquired by the CocaCola Company in 1993. Limca continues to build a loyal following among young adults who love the lighthearted way it complements the best moments of their lives. This drink is available in lemon flavor. Sprite: Introduced in 1961, Sprite is the world's leading lemon-lime flavored soft drink. Sprite is sold in more than 190 countries and ranks as the No. 4 soft drink worldwide, with a strong appeal to young people. Millions of people enjoy Sprite because of its crisp, clean taste that really quenches your thirst. But Sprite also has an honest, straightforward attitude that sets it apart from other soft drinks. Sprite encourages you to be true to who you are and to obey your thirst. Available in the following flavors: Bitter Lemon Citrus Grapefruit, Citrus, Lemon and Lemon Lime.
4.1.2 PEPSICO
Pepsi has been bringing fun and refreshment to consumers for over 100 years. From its humble beginnings over a century ago, Pepsi-Cola has grown to become one of the best known, mostloved products throughout the world. Today, the company continues to innovate, creating new products, new flavors and new packages in varying shapes and sizes to meet the growing demand for convenience and healthier choices. The various product of Pepsi available in India are: Pepsi: Pepsi is the most saleable product of PepsiCo. It is popular in the younger generation all around the world. Diet Pepsi: With its light, crisp taste, Diet Pepsi gives you all the refreshment you need with zero sugar, zero calories and zero carbs, Light, Crisp, refreshing. Mirinda: Mirinda was originally produced in Spain. Mirinda is a brand of soft drink available in fruit varieties including orange, grapefruit, and apple, strawberry, pineapple, banana, and passion fruit and grape flavors. The orange flavor of Mirinda represents the majority of Mirinda sales worldwide. 7up: 7 Up is a brand of a lemon-lime flavored non-caffeinated soft drink. The rights to the brand are held by Dr Pepper Snapple Group in the United States, and PepsiCo (or its licensees) in the rest of the world. Mountain Dew: Mountain Dew (also known as Mtn Dew as of late 2008) is a soft drink distributed and manufactured by PepsiCo. Mountain Dew (and its energy drink counterpart known as AMP) often incurs the disapproval of health experts due to its relatively high caffeine content for a soft drink or energy drink.
Pepsi Blue: Pepsi Blue is a berry-flavored soft drink produced by PepsiCo. It was launched in India near the cricket world cup to associated the Pepsi with the Indian people as Blue is official color of Indian cricket team. The flavor of Pepsi Blue was thought by drinkers to be similar to cotton candy with a berry-like aftertaste (it resembled that of blueberries or raspberries). Slice: Slice is a line of fruit-flavored soft drinks manufactured by PepsiCo and introduced in 1984. Varieties of Slice have included Apple, Fruit Punch, Grape, Passion fruit, Peach, Mandarin Orange, Pineapple, Strawberry, Cherry Cola, "Red", Cherry-Lime, and Dr Slice.
CHAPTER 5: BRANDING
Brand is defined as a name, term, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. A brand is thus a product or service that adds dimension that differentiate it in some way, from other products or services designed to satisfy the same need. These differences may be functional, rational, or tangible, related to product performance of the brand. They may also be more symbolic, emotional or intangible related to what brands represent.
5.2 PACKAGING
Coca cola and Pepsi are much innovated in the packing of their product. These companies introduced different concept of packing. The Airtight bottle concept is given by the Coca cola, which has revolutionized the bottling and packaging industry. These Cola giant also introduced the different size of returnable glass bottle like 200ml, 300ml and nonreturnable plastic bottle like 600 ml, 1.5 litre, 2 litre according to the need of the targeted customer. They also pioneer in bring Cans and Frosted bottles in the market. Packing helps the brand to capture the desire target like 600ml packing is launched, as express pack so this is targeted to touring population and this segment need non-returnable bottles. The Coca cola is innovative in design of bottle like Fanta, kinley (500ml & 1 litre) having curve shaped bottle that are easy to hold.
5.3 LABELING
PepsiCo has associated itself to rich deep blue color as blue color represents eternal youthness and openness that is appropriately consistence with the youth segment they are targeting. PepsiCo under the name of Project Globe Campaign spent 637 million dollars over 5 years, to introduce the new rich deep blue coloring. So labeling helps the brand to get attach with the targeted segment.
Strong brand
WEAK BRAND (BRAND DYNAMICS PYRAMID) In the above explained brand dynamics pyramid, If any brand involves all the characteristic then it is a strong brand whereas if it does not having any weak brand. If we take Coca cola and Pepsi, they both maintain high level of strong relationship. It means there is an image in the mind of consumers that both the companies offer something better than others and nothing else can beat it.
5.6.1.3 Brands Philosophy While developing brand strategy, PepsiCo needs to determine its branding philosophy. This philosophy outlines the use of manufacturer, dealer and in generic brands as well as the use of family or individual branding.
Manufacturer brands (national brands) Manufacturer brands contain the names of manufacturers and generate the vast majority of sales revenues for most product categories. Pepsi Cola appeal to a wide range of the consumers, who desire the low risk of the poor product performance, good quality, routinized purchase behavior, status and convenience shopping. According to Pepsi Cola, manufacturer brands are well known and trusted because quality control is strictly maintained. Their brand names are identifiable and present distinctive images to shoppers. Manufacturers normally produce a number of product alternatives under their brands. Through the manufactures brand the major marketing focus of Pepsi Cola is to attract and retain consumers who are loyal to the firms offerings and to control the marketing effort for the brands.
Private Brands It contains the names designated by wholesalers or retailers and account for the significant levels of sales revenues in many product categories. Dealers secure relatively exclusive rights for their brands and are usually more responsible for their distribution. Private brands typically require large total investment. Wholesalers and retailers are able to sell their items at lower prices and still obtain higher perunit profits. The marketing focus of private brands is to attract and retain the customer who are loyal to the dealer and for the distributor / retailers to exert control over marketing plan for these brands large wholesalers and retailers now advertise their brands extensively.
Generic Brands Generic brand emphasize the names of the products themselves and not manufacturer and dealers names. Generics appeal to price conscious, careful shoppers, who perceive them as representing a very good value, are sometimes willing to accept lower quality, and often purchase for large families generic brands are sold one advertised and receive secondary shelf space consumers must search out these brands. The major marketing goal is to offer low priced, lower quality items to consumers interested in price savings. So Pepsi Cola obtain the manufacturer brand instead of the generic and private brands.
In the 1960s and early 1970s, PepsiCo was a much more aggressive and innovative company than coke. In this period Pepsi outflank coke to survive. In early 1975s Pepsi introduced the Pepsi challenge marketing campaign where PepsiCo set up a blind tasting between Pepsi-cola and Coca-cola. In this Pepsi started direct road show taste competition in which two glass of soft drink one is Pepsi and another is Coke is given to person not known by him which glass contain which soft drink and after tasting both the glasses they ask which soft drink is having better taste. In this competition Pepsi said 80% of people like Pepsi taste over Coke. PepsiCo took this a great advantage of the campaign with television commercial reporting the test results to the public. So through this competition Pepsi is able to position itself in the mind of customer that Pepsi have better the taste than coke. Coca cola follows Push Strategy to advertise and sell their product in the market. Coca cola usually giving higher discount to the retailer fills their selves space with their product and when the consumer see only coca cola in the market they are forced to buy their product only. In India both Coca-cola and PepsiCo have shown the door to older celebrity endorsers and are betting big on emerging stars. PepsiCo was parted ways with Shah rukh khan, Sachin tendulkar, Rahul dravid, Sourav ganguly, Mahender singh dhoni, Ranbir kapoor, Deepika padukone, Ishant sharma, Rohit sharma, Shreeshant and Virender sehwag to strengthen its youngistaan brigade. PepsiCo signed Asin (of Ghajini fame) to take war to orange flavor category. PepsiCo had tied up with Chennai super kings for its 7up brand, which is the most preferred drink there. PepsiCo has also signed on Telegu movie actor Ram charanteja as part of its youngistaan campaign to endorse Pepsi in Andhra Pradesh.
Coca cola try to positions themselves as the happiness bringing drink and drink for every community as visible from above advertisement. As this is well judged by their advertisement and their slogans, there are different advertisement, which depicts thats coca cola is the need for party or coca cola brings more joy and taste to the party. Coca cola has roped in Gautam Gambir as brand ambassador for the company new coca cola open happiness campaign ahead of IPL seasons. While the single ad campaign works wonders, giving the difference in consumption patterns in the south, the coca cola majors had customized their advertisement for the four southern states. Coca cola, on the other hand identified the southern market as a great testing ground for its new brands, so much so that its pulpy orange drink, minute maid and Fanta apple were first launched, marketed and advertised them before a pan India roll-out and a national campaign.
cup rights to Coke, Pepsi launched an aggressive campaign signing up leading Indian cricketers. In 1998, Coke's teen strategy finally moved into place. It signed on Saurav Ganguly and Srinath and came up with the peppy 'Eat crickets, sleep cricket, drink only Coca-Cola'. A near winner was 'Peetikya Coca-Cola?' The aim was to fix the brand's message in consumer mind space. Just as Coke ads were finally telling stories the way Indian consumers like it, aided by Aamir-appeal, Hrithik-mania and Aditi-gaze, comes a damp squib about four friends growing up with Coke, too desperate and too dull. The stakes are high and the two Cola giants are slugging it out for every bit of this market share, even if it means bitter tactics at times. Between Coke and Pepsi they have signed on nine players of the Indian cricket team and Bollywood seems to be the next hot spot they want to cool. For now, it's Shah Rukh, Manisha Koirala, Rani Mukherjee, Kajol, Preity Zinta and Superstar Amitabh Bachchan in the blue (Pepsi) corner and Karisma Kapoor, Rambha and Amir, Hrithik, Aditi Gowatrikar and Aishwarya, in the red (Coke). The battle continues with Aamir Khan and Aishwariya Rai both wooed away from Pepsi by tempting offers from Coke. However this is just the beginning and things are likely to get even hotter.
BENEFITS This model has been utilized by soft drink companies like Pepsi and coca cola to reach rural market. This system allows for larger loads to travel long distances and smaller loads to travel short distances. Thus making the merchant large distributors from the company depots twice a week and the distributors in turn supply to the smaller distributor once a week.
12.2 WEAKNESSES
Weaknesses for any business need to be both minimized and monitored in order to effectively achieve productivity and efficiency in their business activities. Although the international sales are increases but there is getting saturation evident through the stability in cola drink in USA market and moreover all over the world the customer preference for cola drink is shifting towards the healthy drink is taking place. Being addictive of cola drink is also a health problem, because drinking of carbonated soft drink daily has an effect on your body also.
12.3 OPPORTUNITIES
Brand recognition is the significant factor affecting Pepsi and Coke competitive position. Pepsi and Coke brand is known well throughout 94% of world today. As in developing countries the per head consumption of cola drink is very less which evident from taking example of India. In India per head consumption is only 6 bottles as compare to 700 bottles in USA and in Indian market only 5% of the beverage comes under packaging. So looking at these data we can that for these two giant a lot of potential is there in developing market which is now also untapped.
12.4 THREATS
Currently, the threat of new viable competitors in the carbonated soft drink industry is not very substantial. The threat of Substitute, however, is a very real threat. The soft drink industry is very strong, but consumers are not necessarily married to it. Possible substitutes that continuously put pressure on both Pepsi and Coke include tea, coffee, juice, milk and hot chocolate. Even through the Coca cola and Pepsi control nearly 40% of the entire beverage market, the changing health consciousness of the market could have a serious affect. Of course, both have already diversified into these markets, but still this Substitute will remain threat to them. Consumer buying power is also represents a key threat to the Pepsi and Coke.
Research in common refers to a search of knowledge. One can also define research as a scientific & systematic search for pertinent information of a specific topic. It is the pursuit of truth with the help of study observation, comparison & experiment. 11.2 DEVELOPING RESARCH PLAN: After deciding the objective of marketing research the next step is deciding Research plan for gathering effective information related to this research project. The research consists of following steps, which are discussed subsequently. 11.2.1 Research Design:
Descriptive Research: In my market survey descriptive research process was carried out to describe the market characteristics, consumer profiles, distribution strategies, and market potential.
Data Source: During project study I use both primary as well as secondary data source. For primary data collection I visited various retailers in Dehradun & for secondary data I went through Books, Journals & Internet. The information collected is relevant, correct & unbiased.
I followed survey technique for collecting the data. In market survey research approach the carried out information from retailers by using instrument & methods of surveying like, I have chosen personal contact methods because of higher response rate & meaningful responses. This helped me to get the general feedback that helped me in completion of the research part of project.
Reach Instrument: The research instrument used was EDS and DSR form. In which market information detail of each outlet should be filled in EDS form. For this I have visited each & every outlet & check all the brands & packs of Pepsi available or which one is available and demand in comparison with Coke & filled it in EDS forms. In my research process I have used generally closed ended questionnaire where respondents could answer in their own manner. Through this I was able to extract information from the respondents about Pepsis products & the competitors.
Sampling Plan: In designing the sampling plan following points were considered:
Sampling Unit: It includes who is to be a surveyed. Major retailers of Dehradun constitute my sampling unit.
Sampling Size: I have surveyed about each & every outlet of the area specified to me so size would reach up to 350 retailers i.e. the geographical limit is the area of Dehradun.
Contact Method: In my research process, I have collected information through personal interview process with the help of EDS. Form given by the company because it is the most reliable & accurate method for collecting primary data. Through this, the analysis of body language & facial expressions can be traced.
In this market study I have used pie chart for data analysis & interpretation because pie chart is the easiest & comprehensive medium for presentation of data. Sampling unit is a single retailer outlet which may be:-provision store, stationery shop, eatery & kiosk. The universe studied is the sum of the retailers in the Dehradun area.
Demographic Profile
15%
5% 20%
20%
40%
Year
10-15
15-20
20-25
No. 1
25-30
above 30
Beverage products whether of Pepsi or Coca Cola or others is liked by almost every age group. So far as Dehradun, the capital of Uttrakhand youth of age between 20-25 are major buyers of Pepsi.
Time Preference
30%
60% 10%
Evening
Morning
No. 2
Any time
Findings show that beverage products whether of Pepsi or Coca Cola is mostly consumed at any time. This any time seem to lie between 11am to 4pm or we can say that major consumption occurs near about at afternoon.
2%
46%
52%
Pepsi
Coke
No. 3
Other
We all know that Coca Cola and Pepsi are Major market leaders so far as beverage industry is concern. Their market penetration varies from state to state and from city to city. As the research was conducted in Dehradun city the findings show that Pepsi is more prevalent than Coca Cola.
2% 38%
s
60%
Pepsi
Coke
No. 4
Others
Market is flooded with different flavors under different brands and their demand also differs so far as age group, climate, situation is concern. If we talk of Pepsi and Coca Cola in Dehradun, dew and slice flavor of Pepsi is demanded enormously and these flavors contribute more in market share of respected brand.
2%
8%
90%
One
Two
As the findings show that youth are major buyers of Pepsi products, they are fully aware about which products is under which brand. But there are people who do not buy using brand name.
11%
89%
Yes
No. 6
No
Both the Pepsi and Coca Cola has maintain the trend of introducing various products under their brand name and these products has been well accepted by people. Similar sort of product named as Diet Pepsi was launched by PepsiCo and the findings show that in Dehradun majority of people were aware about Diet Pepsi.
49% 51%
Sprite
No. 7
7 Up
So far as plane flavor of both Pepsi and Coca Cola is concern, there is not so much difference in their market capturing power. But still Sprite of Coca Cola has a little more demand than 7 up.
30%
70%
Limca
Mirinda Lemon
No. 8
In case of lemon flavor limca has captured major market in Dehradun area than its complementary flavor Mirinda lemon.
So far as demographic profile is concern, the result was that the major buyers of Pepsi and Coca Cola were youth between the ages of 20-25 and 25-30. The most interesting point to analyze was that the consumption of beverage products by the age group 10-15 is increasing and mostly in among the childrens of upper family classes. After interpreting the findings regarding the time preference, the result came out that the customer prefer to buy the beverage products in late afternoon. These finding may vary from other findings carried out in other cities depending upon geography of that place. So far my area of survey was the capital of uttrakhand and here the weather conditions during early morning and evening remains cool, so people does not prefer to buy the chill products in morning and evening. One of the main interesting finding was that the market share of Pepsi in dehradun is more than that of Coca Cola. The reason for that may be the better distribution channels of Pepsi and its penetration in the market. Another reason for that may be that in Coca Cola we have ordered system and supply of products is met when order is placed by retailer. Where as in Pepsi we dont have ordered system and the distribution channels and vehicles are available throughout the day. Now so far as different flavors under the brand name of Pepsi and Coca Cola are concern and their part in respective market share, the Pepsi seems to be the best flavor provider. But the demand of some flavors is negligible as compared to others. If we talk of Pepsi the more demanded flavors are dew and slice. Similarly in Coca Cola thums up and coca cola are more demanded. And its these flavors that matters so far as the market share of respective brands is concern. Another important fact was to find out whether people know which flavor belongs to which brand. The result was similar as I have expected i.e. majority of people were aware about which flavor is of Pepsi and which one is of Coca Cola. 90% of people know the product under particular brand name, they are consuming or buying.
Companies are coming with different products and important to create awareness about these products. Diet Pepsi was similar kind of product launched under brand name PepsiCo. Finding show that Pepsi was successful in creating awareness about this product as 89% of customers know about it. If we talk of market share of plane flavors, there is not so much difference. Both 7up of Pepsi and sprite of Coca Cola have equally captured the market. But the results show that sprite is more preferred than 7up. Similarly the findings show that in case of lemon flavor, limca has greater market share than mirinda lemon. The reason for that is, lemon is in the market from very beginning when Coca Cola enter India.
11.5
CONCLUSION
1. After visiting nearly 350 outlets I found that Pepsi & the products under its brand name is doing a good job in Dehradun. It is clear that Pepsi is leading Coca Cola in the soft drink market in Dehradun region. If we compare Pepsi and Coca Cola in terms of Signage or display material then Pepsi has an edge over coke. 2. At this time it is solely depends on the retailer which brand he offers to the consumer? Although the company has been unable to satisfy the retailers. The company must take immediate steps in order to resolve its disputes with these retailers.
3. It was also found that the schemes that are brought up in the market by Pepsi & Coke after every couple of day is making huge effect on the sale of Pepsi and Coca Cola than their brand name. Whereas one is cannibalizing others market only. 4. It was also seen that Pepsi brand is better sold than coke. But it is Thums up, which is making the major difference in the market.
5. The sale in age wise section, it was found that 200ml is sold in all the age groups with same frequency but 300ml is sold mostly in 16 to 45yr. of age group where as CAN is sold to younger generation only. Finally 2litre are used only for family or party purpose. 6. It was also seen that Pepsi brand is lagging the Coke especially in Muslim dominated area, which makes a major difference in the market.
11.6
RECOMMENDATIONS
1. PEPSI, the choice of Generation next is not providing the first choice of young generation. A young generation wants something strong in cold drinks & thus prefers Thums up. Pepsi should come out with some extra strong taste to catch up maximum young generation & to become exactly Generation Next drink. 2. Company should appoint competent & honest salesman so that they could provide schemes to the entire retailers & cover their full route. 3. It is often seen that some salesman do not intimate schemes to the retailer & few of the retailers complained about it. So there should be frequent visits of Customer Executives to their respective areas to keep the shopkeepers benefited with various schemes. 4. Delay in starting of supply vans from respective depot should be checked & a proper time register should be maintained. 5. Most of the retailers are complaining about non-fulfillment of commitments regarding their sampling. Company should make sure that the retailers get the sampling on time so that they are satisfied. 6. Most of the retailers are complaining about delay & no replacement of burst bottles. Marketing Management should sort some solutions to this major problem of replacing burst bottles. 7. Half filled bottles should also be checked at the time of issue of goods from the distributors godown to the respective routes. 8. Company should try to give some credit facility to the distributors so that they get motivated. 9. Credit facility for retailers should be provided.
10. Proper feedback system should be developed by ensuring regular visits & check randomly at the various outlets.
11.7
Questionnaire On Customer preference towards Pepsi & Coca Cola
Dear Retailer/Customer, being a marketing researcher for PepsiCo, we appreciate your cooperation and thank you for providing your valuable time. We would like to know your preference towards Pepsi and Coca cola. Please fill up the questions below, so that we have an opportunity to serve you better. 1) 2) 3) 4) Name: Address: Outlet name: Contact no:
Q.no1: What is the present share of your outlet? Pepsi Coca Cola
Q.no2: Which Brand according to you is most preferred by people? Pepsi Coca Cola
Q.no3: Do you think Brand Name affects the sale? Yes No Coca Cola _____ _____ _____
Q.no4: What is the demand of different customer group? Group Pepsi Male Female Children _____ _____ _____
Q.no5: Which company more actively responds to your complaints? Pepsi Coca Cola Other
Q.no6: Which of the company you feel have better distribution network? Pepsi Coca Cola Other Q.no7: Which of the company you feel provide better Schemes? Pepsi Coca Cola Other
Q.no9: Which flavor of PepsiCo is more demanded? Pepsi Mirinda-Orange Mountain Dew Mirinda-Orange Mirinda-Lime Slice
Q.no10: Does Coca Cola offer better service than PepsiCo? Yes No
Q.no11: Which age group you feel is major buyer of PepsiCo products? 10-15 15-20 20-25 25-30 Above 30
Q.no12: Are you aware about Diet Pepsi product of PepsiCo is? Yes No
Q.no14: What according to you is positive point of PepsiCo over Coca Cola? Better quality Better service Better schemes Better Strategies Q.no15: Do you agree that Pepsi has better advertisement and sales promotion strategies? Strongly Agree Agree Disagree Strongly Disagree
Q.no16: Please rank the products of Pepsi according to their demand? Pepsi Dew Mirinda Slice 7up
Q.no17: According to you at what time people prefer to buy Pepsi or Coke products? Morning Evening other time
Q.no18: Which according to you has best flavor product mix? PepsiCo Coca Cola other
Thank you
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