INTRODUCTION

This project is all about measuring the retailer satisfaction of after-sales-service of Pepsi
products. For the past two years every company is trying to satisfy its customers.

The emphasis is on ways of retaining customers, than on attracting new customers. It is

not easy to attract new customers then to retain old customers. So, companies are trying to focus on
this aspect of customer satisfaction.

The sale of product end with the sale transaction but it is the point at which the original
marketing concept starts. The market has to see that whether the consumer is satisfied with that
particular product/service or not.

The post purchase behavior is important for a marketer. If there is any cognitive
dissonance in the minds of the customers then that is enough to lose a customer. Keeping this in
mind, the companies are giving more importance to customer satisfaction.

This project work has been done to find out whether a retailer is satisfied or dissatisfied,
also to measure the level of the retailer satisfaction and provide this feedback to the company. The
first phase of the project involves preparing a structured questionnaire, in order to measure the
level of retailer satisfaction.

The collected information is analyze and presented in a pie chart and bar charts. The
findings and the suggestions to improve retailer satisfaction faced have been given in the
suggestions part. This is a brief summary of the project; the detailed study of the project follows.

Good marketing is no accident, but a result of careful planning and execution. Marketing
practices are continually being and reformed in virtually all industries to increase the chance of
success. Marketing excellence is rare and difficult to achieve. Marketing is both art and
science there is constant tension between the formulated side of marketing and the creative
side. The world economy has undergone a radical transformation in the last two decades
Geographical and cultural distance have shrunk significantly with the improvements in the
production, transportation and communication. These advances have permitted companies to widen
substantiallyboth these markets and their supplier sources. And thus the role of marketing becomes
wide. Marketing is the specialization subject of MBA curriculum. When a flood of consumer
products are coming into the market, every company needs people specialized in marketing to
promote their product.

1
 Marketing deals with identifying and meeting human and social needs. One of the
shortest definitions of marketing is meeting needs profitably.

The 21st century is the era of Advertising, Marketing and Sales Production; Marketing is
to convert social needs and wants. Apart from basic necessities of air, shelter and clothing, every
person has strong desire for recreation and entertainment. They have strong preference for
particular brand of basic and services. Marketing serves as the link between the societys needs and
its pattern of Industrial response. Beverage industry is one of the fast growing industries in India.
We can divide Beverages into two sections i.e. Alcoholic & Non-alcoholic. The non-alcoholic
drinks are soft drinks that can be further classified Cola, Lemon, Orange, Mango and Apple
segment.

INTRODUCTION ABOUT THE STUDY:

I was assigned to study the promotional activities of Pearl Beverages Pvt, Ltd.
Promotional activities play a greater and important role in the entire marketing effort being carried
out by Pearl Beverages Pvt, Ltd, to generate more sales as well as to create and maintain an image
of its product.

Thus Pearl Beverages Pvt, Ltd carried out its promotional activities as a controlled and
integrated program of communication and material design to present its soft drink to the
prospective customer. It also helps in communication the need satisfying qualities of soft drink, to
facilitate the sales and eventually to contribute towards the profit in long range. The tools used by
Pearl Beverages Pvt, Ltd, for fulfilling the various purposes of its promotional activities are the
following:-

Point of sale display

Dealers sale contest
Sales promotion through special event market
Advertising
Incentives
Games

Point of Sale Display:

A sensible man does not have to go far to find out whatever a common pan wala knows
that people buy with their eyes. Every item on sale in a shops and vendors in towns either selling
consumer or selling soft drinks. Rather in selling a product like PEPSI display is more than help, it

2
is an essential element because soft drink is bought on impulses on the spur of the movement. Thus
the product is tested when it is brought at peoples attention.

Dealers sale contest:

Another method of sales promotion being used by the Pearl Beverages Pvt, Ltd., through
its distributors is to conduct dealers sales contest during the peak seasons i.e. during April to July.
In it the dealers are given prize in the form of cases of soft drinks. In the contest at first his or her
respective distributors according to their categorize each dealer. And then each his or her category
has to achieve during the contest period.

The dealers achieving highest sales over and the above the target set is giving the awards
as under, the order of prizes announced are first prize,2nd prize, and 3rd prize in terms of number of
free cases of soft drinks which was Pepsi space club 2006 program me.

Special event market:

The dealers at special event sports place the banners and stall of Pepsis product like
picnic fates cricket test match, social are also used to cater the people. It helps in promoting the
sale as well as in creating an image product.

Sales man contest:

Sales man contest are held to motivate the sales man. Under the scheme salesmen are
given monetary incentives on the basis of sales made in their given route.

Media planning:

A very important part of advertising is to decide the medium of advertising and how much
to spend in each media: - Newspaper & Magazines, Radio, TV, Hording, Product of sales materials
(paintings, glow signs, Display Board) Advertising Is one of the important factors which all put
together results sales. It has to be backed by the distribution network, effective servicing, dealer,
goodwill and so on. Thus advertising has to be very carefully woven with the entire demands of
marketing.

3
Merchandising/Displays:

Proper merchandising and display at the store level promotes sales; it promotes the
consumer to switch over to the displayed brand ignoring existing brand loyalties; it persuades him
to buy now rather than later; and it makes him buy more than the originally intended quantity.
All these are essentially sales promotional functions. While advertising can only make a consumer
aware of the product or generate a desire. For it, merchandising/ display often motivates a
consumer to buy a product instantly. Point of purchase displays are one of the most widely used
sales promotions tools. With the proliferation of brands, innovative displays have become a
prerequisite for success. In the store brands compete with each other for consumers attention.

Display Enhance Counter Pull:

Display at the point of purchase can be rightly describe has a clincher in the marketing
process. When awareness and interest has been created in the consumers mind through advertising
and other promotional measures, a good display in the store can help to clinch a sale. The displays
are also effective in inducing brand switching. A consumer normally goes to a retail outlet to
purchase his usual brand. At the retail outlet, a good display of a competing brand can command
his attention and he may buy the competing brand. In other word Good display can lead to impulse
buying and brand switching. A good display is the surest way to attract the consumers. In fact,
displays have their origins in the age old saying that goods well displayed are half sold. Display
can be of various types window display, wall display, counter display, Arial display, or floor
display, depending on where it is fixed. Display materials to constitute a large spectrum, like
posters, danglers, stickers, mobile wobblers, steamers, balloons, etc. To enhance the display effect,
manufacturers use several gadgets and approaches. Illuminated designs, motion displays, sky
writings, etc., add to the display effect. Some companies organize display units locate them
advantage points within them store to attract store traffic. Skillfully designed and strategically
located display units can enhance the sales appeal. More and more firms are going in for innovative
displays to give their brands visibility in todays crowed shop shelves.

4
Pepsi cool Zone:

Pepsi, for instance, set up cool zones in outlets to create a visual effect. These zones
house Pepsi display racks next to its visi coolers, both stocking the entire Pepsi range in a present
format the products horizontally, at eye level, and in different sizes down the racks with selling
price on. Companies are also using the technique of mass display. Within the limited space
available in there tail store, big stocks of a given brand are artistically arranged to gain attention.
Customized racks are also being used for display effect. Now the Pepsi has launches a SPACE
CLUB 06 on this regard. Pepsi space club06 is a trade promotion which is internal affair between
the company and its trade.

NEED FOR THE STUDY:

The need for the study on the part of organization is to determine the level up to which a
retailer is satisfied with its after sales. By doing so the firm assess whether they are meeting the
expectations of their retailers. Them the firm will make strategies to fill the gap between the
retailers expectations and what they are offering which leads to high retailers satisfaction.

To find out the retailer satisfaction to buy the Pepsi products.

To find out the problems after sales and services in Pepsi.
To find out the retailers are satisfy or not to purchase Pepsi products in Pearl Beverages.
The retailers prefer or not to buy products in authorized dealers.

OBJECTIVE OF THE STUDY:

To study about the promotional activity of Pearl Beverages Pvt. Ltd. This was PEPSI
SPACE CLUB 2008.
To know about the stock position of Pepsi brand and its competitors at different outlets.
To know the per day sale of Pepsi brand and its competitors in creates.
To know the distribution channel efficiency Pepsi.

5
SCOPE OF THE STUDY:

The study is limited to 50 members who are the retailers of both Pepsi and Coca-Cola in
the Vijayawada. The study to observe Retailers are prefers to buy Products in Pepsi. To find the
retailers are satisfied of after sales and services of Pepsi products in Pearl Beverages Pvt. Ltd.

To find out the retailers satisfaction to purchase products of Pepsi.

To find out the problems of after sales and services in Pearl Beverages Pvt. Ltd.
The retailers prefer or not to buy Pepsi products in authorized dealers.

METHODOLOGY OF THE STUDY:

To find the per day stock and per day sale at different outlets exploratory research method
is adopted. A survey form was prepared and the retailers were asked to answer them during the
course of their interview.

The first phase of the project involves collection of data from the retailers. The
methodology adopted for the study was that of the field survey method. The sampling technique
used is the non-profitability sampling technique called convenience sample. A structured
questionnaire was administered to a total of 50 retailers of both Pepsi and Coca-Cola. Basing on
this response the satisfaction of the retailers towards after-sales service is determined and analyzed.

Sampling plan:

This plan calls for three aspects

Define the sampling unit.

Decide the sample size.
Decide the sampling procedure whether to use profitability or Non- profitability sampling
methods.

Contact method:

Once the sample plan has been determined, the research has to decide how the subject is
contacted. The choices are mail, telephone or personal interviews.

Collection of information:

Data collection phase is generally the most expensive and there are more chances of
errors. Carry out the field work, collect using the instrument and adjust the problems, replaced,
refusal to cooperate, biased do dishonest answers.
6
Analysis and Interpretation:

The next step is to extract pertinent findings from the collected data. The research edits,
tabulated the collected data.

Presentation of findings:

As the last step in marketing research, the researchers present the findings. The
researchers have to arrange the researched result according to an approved reporting format, get the
report typed and bound, present the copies of report to the concerned authorities.

The importance of the questionnaire:

The significance of the questionnaire is that it gives information about the characteristics
basing on which the inference as to whether the retailer is satisfied or dissatisfied can be
drawn.
The questionnaire contains close-ended questions and also some personal information of the
respondents.
The questionnaire is framed in such a way that the respondents feel easy to answer and get
more information.
The questionnaire contains a rating scale question (5 point rating scale) so as to measure the
level of customer satisfaction.

Period of Study:

The project has been in 45 days.

LIMITATIONS OF THE STUDY:

Many difficulties come in front on me while collecting the data as many retailers do not
cooperate and searching of retailer outlet name was much more difficult as many of them have
changed their outlets name.

The size of the sample being relatively small, some of the findings may slightly vary with
those of the larger universe. The study is confined to the information willingly shared by the
respondents.

7
 INDUSTRY PROFILE

SOFT DRINK INDUSTRY: AN OVERVIEW

It all began in 1886, when a tree legged brass Kettle in Hohn Styhpembertons
backyard in Atlanta was brewing the first P of marketing legged. Unaware the pharmacist has
given birth to control syrup, which is now the chief ingredient of the worlds favorite drink. The
syrup combined with carbonated the soft drink market. It is estimated that this drink is served
more than one thousand million times in a day. Pemberton & Robinson laid the first foundation
of this beverage when an average nine drinks per day to begin with, upping volumes as sales
grew in 1894, this beverage got into bottle, courtesy a candy merchant from Mississippi. By the
1950s Colas was a daily consumption item, stored in house hold freezes. Soon were born other
non-Cola variants of this product like orange & lemon. Now, the soft drink industry has been
dominated by three major players (1) The New York based Pepsi co. Inc. (2) The Atlanta
based Coca-Cola co. (3) the United Kingdom based Cadbury Schweppes. Throughout the glove
these major players have been battling it. Out for a bigger chunk of the ever - growing cold
drink market. Now this battle has begun in India too. India is now the part of cold drink war.
Gone are days of Ramesh Chauhan, Indias one time cola king and his bouts of pistol shooting.
Expect now to hear the boon of cannons when the Coca-Cola & Pepsi co. battles it out for, as
the Jordon goes a bigger share of throat. By buying over local competition, the two American
cola giants have cleared up the arena and are packaging all their power behind building the
Indian franchisee of their globe girdling brands. The huge amount invested in fracture has never
been seen before. Both players seen an enormous potential in his country where swigging a
carbonated beverages is still considered a treat, virtually a luxury.

In colas, Pepsi is already market leader and in certain cities like Delhi, Pepsi outlets are
on one side & all the other colas put together on the other. While coke executive scruffs at Pepsis
claims as well as targets, industry observers are of the view of that Pepsi has definitely stolen a
March over its competitor coke. A part from numbers, Pepsi has made qualitative gains. The
foremost is its image. This image turnaround is no small achievements, considering that since it
was established in 1989, taking the hardship route prior to liberalization and weighed down by
export commitments. Now, at present as there are three major players coke, Pepsi and Cadbury
and there is stiff competition between first two, both Pepsi and coke have started, sponsoring

8
local events and staging frequent consumer promotion campaigns. As the mega event of this
century has started, and the marketers are using this eventworld cup football, cricket events and
many more other events. The success of soft drink industry depends upon 4 major factors
viz.

Availability
Visibility
Cooling
Range

AVAILABILITY

Availability means the presence of a particular brand at any outlet. If a product is now
available at any outlet and the competitor brand is available, the consumer will go for that.

VISIBILITY

Visibility is the presence felt, if any outlet has a particular brand of soft drink say-Pepsi
cola and this brand is not displayed in the outlet, then its availability is of no use. The soft drink
must be shown off properly and attractively so as to catch the attention of the consumer
immediately.

COOLING

As the soft drinks are consumed chilled. So, cooling them plays a vital role in boosting
up the sales. The brand, which is available chilled, gets more sales then the one which is not, even
if it is more preferred one.

RANGE

This is the last but not the least factor, which affects the sale of the products of
particular company. Range availability means the availability of all SKU (Stock Keeping Units).

9
 PepsiCo is one of the largest companies in the U.S. it figures amongst the largest 15
companies worldwide according to the number of employees hired. PepsiCo is a world leader in
the food chain business. It consists many companies amongst which the famous one is Pepsi
Cola, Frito-Lay and Pepsi food international. The group is presently into two of the most
profitable and growing industries namely, beverages and snack foods. It has scores of big brands
available in nearly 150 countries across the globe. The group has established for itself once of
the strongest brands in various segments of its operations. The beverages segment primarily
markets its Pepsi, Mountain Dew and other brands worldwide and & 7up outside the U.S
markets. These are positioned in close competition with Coca-Cola Inc. of USA. A point which
is worth a mention is that Coca-Cola gets 80% of its profits for international operations while the
same figure for PepsiCo stands at 6%. The segment is also in the bottling plants and distribution
facilities and also distributes the ready to drink tea products of Lipton in North America. In a
joint venture with orient spray juice products PepsiCo also manufactures and distributes fruit
juices. The snack food division manufactures

THE GENESIS OF PEPSI:

The summer of 1898, as usual, was hot in New Bern, North Carolina. So a young
pharmacist named Caleb Brad ham began experimenting with combinations of spices, juices and
syrups, trying to create a refreshing new drink to serve to his customers - he succeeded beyond all
expectations because he invented the beverage now known around the world as Pepsi-Cola. Caleb
Brad ham knew that to keep people returning to his pharmacy, he would have to turn it into a
gathering place. He did so by concocting his own special beverage a soft drink. His creation, a
unique mixture of Cola nut extracts, vanilla and rare oils, became so popular his customers
named it "Brad's Drink. Caleb decided to rename it "Pepsi-Cola," and advertised his new soft
drink. People responded, and sales of Pepsi-Cola started to grow, convincing him that he should
form a company to market the new beverage. His creation, a unique mixture of Cola nut extract,
vanilla and rare oils, became so popular his customers named it "Brad's Drink." Caleb decided to
rename it "Pepsi-Cola," and advertised his new soft drink. People responded, and sales of Pepsi-
Cola started to grow, convincing him that he should form a company to market the new beverage.

10
 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 trade mark. 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. By the end of 1910, there were Pepsi-
Cola franchises in 24 states. 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 promoted
Pepsi sales with the slogan," Drink Pepsi-Cola. It will satisfy you.

"In 1934, the company moved to a new headquarters location in Long Island City, New
York, and four years later, in 1938, Walter S. Mack was selected to be the new president of
Pepsi-Cola. Mack believed that advertising could be a basis of soft drink marketing and soon
introduced a comic strip," Pepsi & Pete" To promote Pepsi's pricing advantage with the line "
Twice as much for a nickel." The company also began experimenting with new bottle sizes, and
for the first time began to package Pepsi-Cola in cans. For Pepsi-Cola, the '50s were embodied by
the company's new president, Alfred Steele, a man of immense drive and vitality, who presided
over an extended period of growth and expansion. By the mid-1950s, Alfred Steele had become
chairman of Pepsi's board of directors, and Herb Barnett had replaced him as the company's
president. Innovation continued, and a distinctive new "swirl" bottle was introduced in1958. That
same year, a new advertising campaign," Be Sociable, Have a Pepsi". Was also launched.
Internationally, Pepsi continued to expand still now. Pepsi-Cola sensed that attitude and captured
their spirit with a name that has stood the test of time. They were the Pepsi Generation. During its
first 65 years, Pepsi-Cola Company sold only one product-Pepsi. But, with the baby boom, not
only did the nation's population change, so did the way it thought of soft drinks. For many
people, soft drinks had to be not just refreshing, but a complement to diet habits as well. So, in
1963, the company developed a new low-calorie drink with a taste worthy of carrying the Pepsi-
Cola name: Diet Pepsi.

In 1964, Mountain Dew, a regional soft drink favorite, became an important new
addition to the growing family of Pepsi-Cola brands, and its advertising theme, "Yoo-hoo,
Mountain Dew, "became the brand's instantly recognizable signature.

11
 Pepsi in cans had by now proved so popular that full-scale commercial distribution
began in 1965. That same year Pepsi-Cola Company merged with a successful Dallas, Texas,
marketer of salty snacks, Frito-Lay, Inc., to form PepsiCo-one of the great consumer products
companies on the U.S. Business scene. "Pepsi: The Choice of a New Generation.
"A campaign that reaffirmed Pepsi's position on the leading edge of contemporary
culture. Pepsi made its first trip on the space shuttle, carried in a specially designed "space can,"
and crossed yet another new frontier by beginning distribution in China. By the middle of the
decade, more than 600 Pepsi-Cola plants were operating in 148 countries and territories
throughout the world. As Pepsi's business throughout the world continued to increase in
importance, Chris Sinclair was a president of Pepsi-Cola International in1989. As the 1990s
opened, so did a new era in Pepsi's international operations. The company signed the single
largest trade agreement in history with the Soviet Union. Seeking long-term growth, Pepsi
invested in such high-potential markets as China, Eastern Europe, Mexico and Argentina.

More than that, PepsiCo has become a truly international company. Its soft drinks and
other beverages, snack foods of every variety and the PepsiCo restaurants can today be found in
every corner of the globe. PepsiCo brands and PepsiCo operations today employ almost half a
million people in 195 countries around the world. These developments and many more will write
Pepsi story for the next millennium-a story that was undoubtedly find a company with a vast
resources, thriving businesses, extra ordinarily financial strength and thousands of bright,
dedicated people.

PEPSIS MARKETING STRATEGIES:

Pepsis approach is radically different from that of Coke; Pepsi has gone in for
concentration segmentation. Pepsi has targeted them out segment instead of trying to be something
to all segments. Pepsi has since beginning strove to achieve its international position as a drink for
the new generation in India. Helped by HTAs forceful visuals and creative, Pepsi has been
successful in positioning itself for the younger generation.

12
SELLING PROCESS:

Pepsi has a very well managed selling system. It takes a lot of care to ensure that the
products (Pepsi bottles) are available to the consumers. Pepsi soft drinks are produced our plant
in different SKUs (Stock Keeping Units) and distributed to our distributer and they further
supply to their tailor. Sahibabad (GZB) has been divided around 14 routes which are called
direct routes. For every route there is a Route Agent. Route Agent moves with the company
owned truck and ensure that maximum shops are covered each day, so that regular supply of
Pepsi soft drinks is made. Routs agents take the order from the shop keepers and then with the
help of loaders they give the required number of crates to the retailers or shop keepers & then
move to next. Our plants also have some agency in each rout. They supply in the areas where
Pepsis trucks are not able to reach. These areas are called indirect-routes.

13
 COCA-COLA

MARKETING STATEGIES OF COKE:

A. PRODUCT:
Coke was launched in India in Agra, October24, in '93', soon after its traditional all Indian launch of
its Cola. At the sparking new bottling plants at Hahira near Agra. Coke was back with a bang after its exit in
1977. Coke was planning to launch in next summer the orange drink, Fanta-with the clear lemon drink, sprite,
following later in the year. Coke's product line includes, Coca-Cola, Thums Up, Fanta, Maaza, Sprite, Club
Soda, 7-up, Limca, Fanta apple, Diet Coke.

B. PACKAGING:

Coca-Cola India Limited (CCIL) has bottled its Cola drink in different sizes and different packaging
i.e., 200ml bottle, 300ml.Bottle, 330ml.Cans, 500ml. and bottles of 1 and 2litre.

PRODUCT POSITIONING:
One important thing must be noticed that Thums Up is a strong brand in western and
southern India, while Coca-Cola is strong in Northern and Eastern India. With volumes of Thums
up being low in the capital, there are likely chances of Coca-Cola slashing the prices of Thums
Up to Rs.5 and continue to sell Coca-Cola at the same rate. Analysts feel that this strategy may
help Coke since it has 2 Cola brands in comparison to Pepsi which has just one. Thums Up
accounts for 40% of Coca-Cola Companys turn over, followed by Coca-Cola which has a 23%

Share and Limca which accounts for 17% of the turnover of the company. We will sell whatever
consumers want us to". Coca-Cola India has positioned Thums up as a beverage associated with
adventure because of its strong taste and also making it compete with Pepsi as even Pepsi is
associated with adventure youth.

b)PRICE
The price being fixed by industry, leaving very little role for the players to play in the
setting of the price, in turn making it difficult for competitors to compete on the basis of price.
The fixed cost structure in Carbonated Soft Drinks Industry and the intense competition make it
very difficult to change or alter the prices. The various costs incurred by the individual
companies are almost unavoidable. These being the costs of concentrates, standard bottling

14
 Operations, distributor and bottlers commissions, distribution expenses and the promotional and
advertising expenditure (As far as Coke is concerned, it had to incur a little more than Pepsi as
Pepsi paved its way to India in 1989 while Coke made a comeback in1993.) Currently a 300ml.
Coke bottle is available for Rs10 the 330 can was initially available for Rs.15 and now Rs.20.
The prices of 500ml, 1liter. And 2ltr being Rs.20 Rs.35 and Rs.50 respectively (according to the
current survey). However, the trends may have been in the early '90's, now the prices of Pepsi
and Coke are the same making it difficult in future and present to compete on the basis of price.

C. PLACE

Coke may have gained an early advantage over Pepsi since it took over Parle in 1994.
Hence, it had ready access to over 2, 00,000 retailer outlets and 60 bottlers. Coke was had a better
distribution network, owing to the wide network of Parle drinks all over India. Coke has further
expanded its distribution network. Coke and its product were available in over 3, 00,000 outlets
(in contrast with Pepsi's 2, 75,000). Coke has a greater advantage in terms of
geographical coverage.

Coke and Pepsi have devised strategies to get rid of middlemen in the distribution
network. However, 50% of the industry unfortunately depends on these middle men. As of now,
around 100 agents are present in Delhi. Bottlers of the 2 multinationals have strongly felt the
need tore move these middlemen from the distribution system, but very little success has been
achieved in doing so.

D. Promotion:
It must be remembered that soft drinks purchases are an impulse buy low involvement
products which makes promotion and advertising an important marketing tool. The 2 arch rivals
have spent a lot on advertising and promotional activities.

According to Paul Stobart, advertising encourages customers to recognize the quality

the company offers. Price promotions often produce short-term sales increases.
Coca-Cola has entered new markets and also developing market economics (like India)
with needed jobs.

15
 Strategies Adopted by Coke and Pepsi

The Pepsi Process:

Despite being a global brand, Pepsi has built its success on meeting the Indian
consumers needs, particularly in terms of making the brand synchronize with localized events
and traditions. Instead of harping on its global lineage, ergo, it tries to plugin to ethnic festivals;
use the vernacular in different part of the country, and blend into the local fabric .Pepsi is using
both national campaigns such as the Drink Pepsi, Get Stuff scheme, which offers large
discounts on other products to Pepsi-buyers as well as local.

The Coke Copy:

Instead of creating a bond with the customers through small but high-impact events,
Coca-Cola chose to associate itself with national and international mega events like the World
Cup Cricket, 1996, and world cup football 1998. But now coke is also entering into local actions.
Coke is also trying to make their brand synchronize with localized events traditions and festivals.
Coca-Cola new tagline in this advertisement isReal shopping, real refresher. In this way
Coke is copy of Pepsi.

EMPOWERMNT:

The Pepsi Process:

Once of the strongest weapons in Pepsis harmony is the flexibility it has empowered its
people with. Every manager and sales person has the authority to take whatever step she, or she,
feels will make consumers aware of the brand and increase its consumption.

The Coke Copy:

Flexibility is the weapon that Coca-Cola, fettered as it is by the need for approvals from
Atlanta for almost everything. In the past, this has shown up in its stub born insistence on junking
the franchisee network it had acquired from Parle; in its dependence on its own feedback
mechanism mover that of its bottlers; and of its headquarters led approach.

16
PRICE

The Pepsi process:

Pepsi has consistently wielded its pricing strategy as in invitation to sample, aiming to
turn trial into addiction. It launched the 500 ml bottle in 1994 at Rs.18 versus Thums Ups Rs.9 in
April, 1996, its 1.5liter bottle followed Coke into the market place at Rs.30 Rs.5 less than
Cokes. But it couldnt continue the lower price positioning for long.

The Coke Copy:

Initially, coke carbon-copied the strategy by introducing its 330ml cans in January 1996,
at an invitation price of Rs.15 before raising it to Rs.18.By this time, it had realized that the
Coca-Cola brand did not hold enough attraction for customers to fork out apremium.

SLOGANS

It's clear in looking at the slogans over the years that Coke and Pepsi has every different
targeting strategies. Coke is touting itself as the original, the authentic, and appealing to a sense
of tradition, positioning itself as an integral part of daily life. Pepsi, on the other hand, is
promoting itself as something new, young, and hip, which seems a little odd after over 100 years.
But Coke was first, after all. Pepsi has always targeted the youth market more aggressively than
Coke.

17
 RESEARCH METHODOLOGY OF COMPARISION

Research in common language refers to a search for knowledge. One can also define
research as a scientific and systematic search for pertinent information on specific topic. In this
era of cut throat competition it is of vital importance for any company have a strong foot hold in
the product market and having a strong distribution network, effective sales promotion and
advertising strategies. These pricing policies should also be such which will help the min
achieving their targets. Ever company strives to earn profit through maximizing their sales
according to varying needs of their customers. The same applies to the soft-drink company also.
Both the two companies PepsiCo, Coca-Cola(I) Ltd. Is aiming to rise well above their
competitors. So the researcher was entrusted to carry out marketing over view about some of the
most usually demand soft drink. In order to clearly define the task we obtain ideas and insight
through the survey method from primary sources. Field research through observation of
customers and distribution channels.

Objective & Limitations:

The subjects (companies) under study in this project are:-

PepsiCo
Coca-Cola (I)Ltd.

Primary objective:

The main purpose of this study is determining the different strategies that are adopted by
the companies. We will then see how effective these strategies are in helping the companies
achieve their respective targets. The strategies will be evaluated to see which the best amongst
them is and which are most effective.

18
Secondary Objectives:

The secondary objective of the research is to gauge the image of PepsiCo Vis-a--Vis
Coca-Cola [I] Ltd. The research was planned to find the effect of the different brand position
strategies adopted from time to time on audiences perception. It is believed that the audience is
Perplexed by almost same appeal by both the companies in their recent advertisements.

The need is to identify new avenues and ways to project the image of their company.

To identify the difference in their tone, look and style of communication.

To do a comparative study of who comes up with more exciting and innovative offers.

To find out the consumers perception about efficiency of marketing and the future
market leader.

To sketch the imagery of the consumers about various brands and both the companies in
totally.

For this purpose field work as well as table work was done to complete the project. The
various facts and figures of the companies were studied and subsequently suggestions are made,
which keep the company the vendors and the consumers in mind.

19
 CHARACTERSTICS OF THE PRODUCT

These are some of the unique characteristics of the products:

1. Package is returnable and vulnerable to breakage.

2. Weight of package is twice as much as that of the product.

3. Has a seasonal demand resulting in partial idling of the distribution network.

4. Demands high light intensive availability of the product with very low dealer index essential
on account of impulse demand.

5. Occupies more shelf space (or cooler space) per a rupee worth of investment than most other
brand product. This factor, coupled with their turn ability of the container, involves a very high
level of service frequency.

6. Ratio of distribution costs to selling price is higher than for any other branded mass
consumption product. All these point to the fact that a penetrating distribution network coupled
with efficient feeding are the only means to higher sales.

20
 BoardofDirectors

Pearl Beverages Limited:

ManagingDirector C. K. Jaipuria
Director (C.E.O) C. P.Marva
General Manager Sales K. N.P. Nayer
AGM Sales Ch. RamaKrishna
Sales Manager Venkatesh
Account Development coordinator BalaRaju
Senior sales Executive Bapatla Siva
Rural Sales Promoters BhagyaRaju
GunturExecutives Srinivas, Madhu, Venu,Jakhir, Roshan
General Manager DebasishSahob
Plant Manager / Production Manager SaiSwaroop
Logistics Manager Jithendra
Transport Manager RammohanRao
Distributors from Guntur 39

21
 Company Profile

Profile of the organization PEARL BEVERAGES LIMITED

Any organization must decide how many products it will offer for sales and the varieties
in which these products will be offered. This is occurring problem as the market changes. Change
is peoples performance; competition, growth and new technology came into existence. The
problem of this question comes when adding new products to the product line.

In case of soft drinks, there tail outlets may desire to buy a variety of soft drinks
preferably from the same company source i.e., the bottling company, as the retail outlets need
only a small quantity of one brand of cool drinks it becomes necessary to offer several flavors, so
that the salesman secures the sufficient sales on each call to justify the expenses of making the
call. Often new flavors are added to the product line of cool drinks to prevent a competitor. By
establishing a relation with retailers it is also desirable to sell more than one flavor of cool drinks.
To decrease the security of seasonal or cyclical fluctuations. From the point of view of
production, additional products are added to utilize the resources available in the company.
Sometimes it becomes necessary for a company to diversify in activities so as to lessen its risks.

PepsiCo was formed through the 1965 merger of Pepsi-Cola Company and Frito-Lay,
Inc. A $1,000 investment in our stock made on December 31, 1995 was worth approximately

$2,073 on December 31, 2000, assuming the re investment of dividends. This performance
represents a compounded annual growth rate of16%.

Bottler case sales increased 6%, led by double-digit growth in large, priority markets
like China, India and Russia, as well as in Brazil, South Korea, Pakistan and Argentina. These
strong results reflect PCIs (Pepsi Cola International) continuing strategies focus on building its

Core brands and developing the markets offering the greatest long-term growth opportunity,
especially highly populous emerging markets. This ongoing focus has enabled PCI to post five
consecutive quarters of double-digit profit growth.

22
 Pearl Beverages Limited was incorporated in 1997 at Nadimpalem in Guntur district,
Andhra Pradesh for the manufacture of soft drinks. It was set up with financial assistance from
Andhra Pradesh State Financial Corporation (APSFC).

It produces Cola, Orange, Cloudy Lemon, Clear Lemon, and Mango and soda flavors
under the brand names of Pepsi, Miranda-O, Miranda-L, Slice and Lehar Soda. It produces these
soft drinks under franchise agreements. But the company could not exist in the market due to
tough competition from Parle products.

Profile of PEARL BEVERAGES LIMITED:

The company, a bottler for Pepsi has bottling facilities for Cola Orange, Lemon, Mango
and Soda flavors under the brand names of Pepsi, Miranda, 7up, Slice and Lehar Soda. Miranda-
apple was launched in the month of May 2001.

The company produces soft drinks using concentrate, which is supplied by Pepsi Foods
limited and sells them at a fixed price (the price is set by Pepsi foods).

The companyis distributes its products in 8 districts in Andhra Pradesh.

In the first twelve months, the company has notched a 55% market share in which it
distributes. The company tapped the market aggressively with the help of 200 distributors, most
of whom sold only their products. The company sold its products through 560 outlets of which

630 outlets were located in Vijayawada town only.

The company spends 20% of gross revenue on sales promotion and advertising. In
2000-2001 the sales turnover of the company was 3.85 lakhs crates. The company is appending
on local sales promotion activities like painting shops, hording, glow sign boards, point of
purchasing, advertising etc.

Organization Structure and Management:

The word organization has two common meanings:
The first meaning signifies an Institution or Functional group. and,
The second meaning refer to The Process of Organizing the way of Work.

23
 Which is the goal of the organization can be achieved efficiently. The organizing
proved involved balancing the companys needs both for stability and reliability of its goals on
the other hand altering an organization structure can be means of adapting to and bringing about
A change it can be a source of resistance to change.

Organization structure can be defined as the position of an arrangement and relationship

of the component party and position of a company. An organization structure specifies its
division of work activities and show differentfunction or activities arelinked.

There are five elements of the organization structure:

Specialization of activities
Standardization of activities
Co-ordination of activities
Centralization and decentralization of activities
Size of the work unit

The wise president is the head of the organization and Mr. SAMEER KAIWAR vice
president. A team of well-qualified and experienced senior management personnel ably assists
the vice president.

FINANCIAL STRUCTURE

Any company has to provide capital for its fixed and the daily requirements of the
company. On this basis capital is differentiated into two parts. They are:

Fixed Capital:
Some costs in a business are fixed which would be incurred irrespective of the
production. These are the constant costs, which do not change with changes in output ex:
investment in fixed assets like building furniture, machinery, lands etc.

Working Capital:

Working capital means the capital required for daily management of the company ex;
wages, salaries, canteen expenses, and transportation expenses.

24
 Out of this the Pepsi Foods Limited provided them with some benefits like providing
advertising material etc., to the company.

Comparative study of Pepsi and Coke:

1. Pepsi was founded by pharmaceutical D. Bardhhaman 1898; Coke was founded by

druggist John Pemberton in 1886.
2. Pepsi a U.S, $22.08 Billon Company has its headquarters in Atlanta.
3. Entered the Indian market in 1988 as a joint venture between Pepsi company
industry, Voltas, and P.A.I.C.
Cokereturned to India after sixteen years with a low-key launch in Agra, on
October 24th1993.
4. Pepsiwith Rs.500 crores invested in India, it is the largest foreign investor in the
country. Coke investment in India to the tune of U.S $70 billion.
5. Pepsi has eight brandsPepsi, Mirandas (orange, lemon), 7up, Slice, even ness soda,
Mountain Due, Aquafina water. Due to the alliance with Parle, coke and Thumsup, 2
lemon drinksSprite and Limca, one orange flavor brand Fanta, One mango flavor
Maaza.
6. Pepsi is priced at Rs.8.00 for 200-bottled drinks and 300ml at Rs.9.00. Coke is also
priced as same as Pepsi.
7. Pepsi is promoted by a host of celebrities. In India, these include Sachin Tendulkar,
V. V. S Lakshman, Yuvaraj Singh etc., film star Sharukh Khan, Amitab Batchan,
Priti Zinta, Ram Charan Tej etc.
Coke was also promoted by film stars like Ameer Khan and Aishwaraya Rai, Hruthik
Roshan, recently with Mahesh Babu. Internationally Neli Diamond, Elton John, Bill
Corby and Madonna have endorsed it.
8. Pepsis major sponsorship area is cricket and music concerts. Most recently they
sponsored for Indian team in World cup Cricket. Coke Foot ball, particularly the
world cup. And also cricket.

25
 9. Pepsi has bottling plants in India. Coke has operational bottling plants throughout
the country. Mainly of their own, however, have yet to be upgraded to the
international standards.
10. Pepsis outlets of fountain Pepsi have been a runway success. Its 350 outlets in the
capital account for 39% of the sales coke is also planning sales through push cart
vendors all plans to launch a 200ml bottles coke with 115 fountain outlets
throughout the country.

Brands available Pepsi and its competitor Coke:

Pepsi brands:
Pepsi

7up

Slice

Miranda orange

Miranda Lemon
Nimbooz
Mountain Due
LeharSoda
Aquafina Water

Coke brands:
Thumsup
Sprite
Fanta
Limca
Minutemade
Kinely soda

Kinely water

Maaza

26
Availability:

All the brands of Pepsi products are available in the following:

Pepsi :200ml, 300ml, 500ml(Pet), 1000ml (Pet), 1500ml, 2000ml(Pet) Tins.

7UP :200ml, 300ml, 500ml(Pet), 1000ml (Pet), 1500ml, 2000ml(Pet), Tins.

Miranda-O :200ml, 300ml, 500ml(Pet), 1000ml (Pet), 1500ml, 2000ml(Pet).

Miranda-L :200ml, 300ml, 500ml(Pet).

Mountain Due :200ml, 300ml, Tins.

Slice : 250ml, 500ml, 100ml (Pet).

Lehar Soda : 200ml, 300ml, 1500ml.
Aquafina Water : 500ml, 1000ml, and 500ml.

Pepsi vs. Coke in Indian Market:

Pepsi is the quintessential fighter brand. It has always reveled in grabbing market share
from Coke. Expanding markets is simply not in its genes. But in India, it finds itself in a piquant
position: it out sells Coke and Thumsup put together. As a market leader, its reliance on high-
saliency advertising isnt helping any more.

They came, they spent, and they conquered. The size of their combined business adds up
to more than Rs.5500 crores. The equity investment put in it tots up to a humungous $1,347
million (Rs.5700crores). Yet, almost 10 years after PepsiCo and Coca-Cola Company entered
India, both are yet to turn a profit. Their accumulate losses are estimated to be over Rs.800 crores

Back in the US, the top management teams patience had started to wear thin by last
year. We are continuing to invest in India as an act of faith, said PepsiCo President

Indra Nooyi. Not only had the size of the Indian Business remained too small, she said,
it didnt even figure among Pepsis 25 most significant markets. Except India, every where else,
including in Pakistan, PepsiCo was making money hand over first, she added.

Coca-Cola too wasnt willing to keep the tap on for too long. In April 2000, it had
written off $400 million in assets from the Indian operations.

27
 2001 was, therefore, billed as the crucial turning point for both players. Both Coke and
Pepsi had geared their organizations for break-even by the end of the year.

Unit case volumes (a case is equivalent to 24 bottles) were up by 8%. But all the growth
came from a new addition to Cokes Kinely mineral water. Volumes in both kinley and the
carbonated soft drink brands taken together fell, compared to the previous year. Save Mumbai,
where coke recorded 17% growth, and parts of the east, June wasnt too hot either.

PepsiCo hadnt fared any better. Its performance mirrored Cokes across the country,

With volumes plunging in April and May. Sensing the slide in performance, it has pushed
through a huge consumer offer on its 2-litre pack, giving it away at the price of a 1.5-litre pack in
select markets (an offer Coke soon matched).

In a bid to give a leg up to primary sales, coke has own started offering credit to its
distributors on the liquid for the first time in the peak season.

Just that the two cola giants have been in an unseemly hurry to, grow the Indian market
and, at the same time, deny each other any advantage, irrespective of whether it makes economic
sense. In the mid-90s, break-even was pegged at 40 million cases. Today, both
Players together do 150million cases, but break-even is still elusive, says a former senior

Pepsi executive.

In 1996, the battle was fought over visi coolers at the dealer outlets. Infrastructure
(which would help extended its reach beyond the large urban centers) simply because it wasnt
cost effective. So it proceeded to buy them out. The process of valuing each of the Franchise and
due diligence took its time. During that period, the dealers ended up chocking the system by not
investing in coolers or in glass bottles. Without chilling equipment, off take on-premise was
unlikely to grow. In 1997 and 1998, coke ordered 70,000 to 80,000 coolers at its own cost. The
plan was mussed up. Many coolers were randomly placed at outlets that didnt sell more than
four cases a month. In many cases, the coolers simply disappear.

28
 To counter Cokes aggression, Pepsi began giving its glass bottles on loan to its
distributors. It would charge for the liquid but waive the deposit it normally charged on the glass.
That meant that distributors could generate a higher through put on a smaller level of investment,
which would in turn put pressure on Cokes volumes.

The battle spilled into almost every area of operations. In early 1999, Pepsi fired its first
salvo to coincide with the cricket World Cup. Normally, both the cola companies used to
maintain a weekly media pressure of 150 gross rating points (GRPs) on television that year,
between the two competitors. Very often cycles would be as low as there or four in a year.
Unlessthebottlebacktothebottling plant,itcouldnotberefilledandputoutagainintothe market.

As long as the market was growing at 30% per annum, the huge investment in capital
expenditure were worthwhile. But by last year, the market growth rate had slowed down to
around 80%. This year, chances are that it may fall further. After relentlessly expanding
distribution, the cola companies are clearly stretched- experts say that the law of diminishing
returns has begun to set in.
Theres a new danger now: the growth in business isnt keeping pace with the scale of
investments. Share gains have begun to slow down, particularly as each player moves double
quick to neutralize the others moves. High excise duties, octopi and sales tax (which together
account for more than 55%of the MRP) make soft drinks in India among the most expensive
in the world. As long as the two companies keep blazing away on media, the chances are that
they will continue to be branded as a luxury product.

Pepsi and Coke are caught in a blind. This years set back has raised a crucial question:
should they accept seasonal shifts as a given or fight to change consumption patterns? A
particularly difficult decision in a tropical country like India. About 40%of the years sales come in
between the months of March and June. So far, both the cola companies have preferred to go all out
during the peak summer season for the simple reason that it is by far an easier option.

Pepsi suddenly upped the ante by pushing its weekly GRPs to 800, catching coke off-
guard. Next year, coke was ready with a bigger war chest: an ad budget of more than Rs35-
crores. In 1999-00, when coke decided to take on Pepsi in signing up cricket and film stars, the
stakes once again went up. Coke almost snagged Govinda in 1999 for Rs.1.7crore, but Pepsi
trumped the offer with a bid of Rs.2 Crores with starting Amitabh Bachan.

29
 Trade discounts were also unleashed. If the industry norm was around three to four bottles
free with every case, the Cola majors began to offer six to seven bottles. In 2000, particularly in
the north, coke went berserk, giving 50% discounts.

Both cola warriors targeted a clutch of key accounts about 6-7% of the total retail base,
primarily restaurants, movie halls, and hotels. In many cases, the owner would play one against
the other and drive a hard bargain. In many cases, the cola companies paid close to Rs.100 per
case of expected off take as advantage to secure a monopoly over the key account. Some of these
out lets ended up not honoring their commitments. The result: a spate of expensive court cases.

Till the cola companies began to concentrate on the urban centers. As soon as they pushed
into the inter land, the first signs of problems surfaced. In a stake lime Tamil Nadu, the off take
per 1000 people was barely 0.9. As a result, when a Pepsi or a coke truck went
Into interior markets, the glass simply wouldnt come back fast. Either consumption was low
Or the volumes were being split.

Per capita consumption in India is barely seven to eight serving a year. That compares very
poorly and Vietnam, where per capita consumption are 20. The two companies that is, getting
new drinkers into the fold. This is reflected in the massive surge in distribution cover, which is
now expected to go up to 7.5 lakhs outlets by the end of this year.

Given the high stakes, both players are wary of changing the rules of the game. The result:
both players end up slugging it out every year for honors in the peak season. As a market leader,
Pepsi could have played the role of expanding the market. But that would have been completely
out of character for the company.

Across global markets, Pepsi has always reveled in grabbing share away from coke.
But in India, it finds it self in a peculiar position:
It is the numerous Uno brands, out selling both coke and Thums Up put together that have
helped Pepsis Indian team to build quite a rep.
Heres the nub. Pepsi simply doesnt have the requisite knowledge and flair to expand a
Market. Instead, it is Coke which has shown how to create a $60 billion global company by
leveraging one brand. In the past, it has done so by creating usage occasions like serving Coke

30
along with combo meals at Mc-Donalds. Even though it is adept at the expansion game, coke is
reluctant to let an aggressive Pepsi bite off a chunk of the market, which it helps grow. The result:
advertising thats targeted at each other rather than at the consumer.

Pepsi has managed to constantly find ways to connect with the youth. So if Coke is the
universal drink which cuts across age groups, Pepsi is the icon of the real cola quaffs: young
people between the ages of 15-29.

The Nothing Officials about it Campaign, the Dill Mange More, More Pepsi More
Cricket, Time to grebe a Pepsi was classics in their own right. But while the endorsements help
expand the brand franchise to the mass market, just focusing on being top-of-the-mind wasnt
good enough. Beyond a point, existing consumers too need new reasons to buy soft drinks more
often.
Pepsis marketing team realizes that it needs to now change tack. But theres an underlying
reason why both marketers still prefer to rely on building top of the -mind advertising.
Expanding marketers is a slow urn. Most marketing people tend to get evaluated on parameters
like brand preference. Thats why most of them eventually fall back on celebrity-driven
advertising, which quickly improves notice ability.

For a longtime, coke stayed away from celebrity-driven advertising. Once it too began to
rely on hot celebrities like Hrithk Roshan, and Aishwarya Rai, the consumer started getting
mixed signals. The largest opportunity for the cola giants would have to drive home
Consumption. Even today, more than 75% of soft drink consumption is on- premise. But once
again, Pepsi was so obsessed with protecting its current market share; it simply didnt do enough
to grow its home packs. Even today, the largest chunk of marketing spends are put behind the
300-ml glass bottle, this makes up 70% of current volumes.

Occasionally, both players have tended to use a similar size 200-ml to drive penetration.
But not only does it cannibalize the 300-ml float, it also offers very little margin at the current
Rs.6-7 pricing. On the other hand, home packs 1.5-litre and 2-litre in some lead markets like
Mumbai have grown to almost 22% of the total market and is the fastest growing segment.

31
 It is in the interest of both cola giants to growth is market faster. Home packs offer a big
opportunity to grow consumption. When the PET bottles enter the home, research clearly shows
that consumption increases substantially as consumers arent conscious of much they consume,
unlike in a single-serve returnable glass bottle. Also, on-premise consumption is skewed towards
the male members in a family. Home packs will help broaden the consumption set to the home in
the house hold and the elderly.

Home consumption will grow once more usage occasions are created. Thats sun likely
To happen, unless the two companies spend big bucks on creating new occasions. Coke tried a
special Diwali pack last year. But the effort was half-hearted.

Theres another problem. In India, carbonated soft drinks (CSD) have come to acquire
negative health connotations. Thats bound to put a stopper on growth. At the same time, the
Rs.100-Crore fresh fruit juices market dominated by Tropicana and Real is likely to trot along at
40%.

A bloating water business is also crowding out growth in the carbonated soft drinks
business. Simply put, when a consumer reaches out for a bottle of mineral water, it is often at the
cost of a soft drink. Therefore, the on-premise segment, which formed the largest chunk of the
CSD business, is gradually declining.
Heres the real threat: in most Asian markets, with the exception of the Philippines, water is
a far bigger business than carbonated soft drinks. Besides, water can very easily ride on the
exciting distribution. It could also help iron out the seasonal skew in the carbonated soft drinks
business, whats more, the very same visi coolers, which the two cola companies had placed in
the market, which are being used to stock other brands of mineral water?

But both cokes kinely and Pepsis Aquafina have to contend with Ramesh Chauhans
Bisleri, which is discounting heavily to build volumes in the low-margin business. Aquafina will
retain from discounting in the water business. Kinely, on the other hand, is fighting Bisleri tooth
and nail.

The fight has all the making of a cold war. As Coke and Pepsi have shown, there are
no clear winners in such a battle. Only looser.

32
HISTORY:

Soft drinks by definition are carbonated drinks that are non-alcoholic. Carbonated soft drinks are
also referred to as soda, soda pop, pop, or tonic.

1798 The term "soda water" first coined.

1810 First U.S. patent issued for the manufacture of imitation mineral waters.
1819 The "soda fountain" patented by Samuel Fahnestock.
1835 The first bottled soda water in the U.S.
1850 A manual hand & foot operated filling & corking device, first used for
bottling soda water.
1851Ginger ale created in Ireland.
1861The term "pop" first coined.
1874 The first ice-cream soda sold.
1876 Root beer mass produced for public sale.
1881 The first cola-flavored beverage introduced.
1885 Charles Aderton invented "Dr. Pepper" in Waco, Texas.
1886 Dr. John S. Pemberton invented "Coca-Cola" in Atlanta, Georgia.
1892 William Painter invented the crown bottle cap.
1898 "Pepsi-Cola" is invented by Caleb Bradham.
1899 The first patent issued for a glass blowing machine, used to produce glass
bottles.
1913 Gas motored trucks replaced horse drawn carriages as delivery vehicles.
1919 The American Bottlers of Carbonated Beverages formed.
1920 The U.S. Census reported that more than 5,000 bottlers now exist.
Early 1920's the first automatic Vending machines dispensed sodas into cups.
1923 Six-pack soft drink cartons called "Hom-Paks" created.
1929 The Howdy Company debuted its new drink "Bib-Label Lithiated Lemon-
Lime Sodas" later called "7up". Invented by Charles Lei per Griggs.
1934 Applied color labels first used on soft drink bottles, the coloring was baked on
the face of the bottle.
1952 The first diet soft drink sold called the "No-Cal Beverage" a ginger ale sold
by Kirsch.
1957 The first aluminum cans used.
33
 1959 The first diet cola sold.
1962 The pull-ring tab first marketed by the Pitts burgh Brewing Company of
Pitts burgh, PA. The pull-ring tab was invented by Alcoa.
1963 The Schlitz Brewing Company introduced the "Pop Top" beer can to the
nation in March, invented by Ermelo Frazee of Kettering, Ohio.
1965 Soft drinks in cans dispensed from vending machines.
1965 The re sellable top invented.
1966 The American Bottlers of Carbonated Beverages renamed The National Soft
Drink

Association.

1970 Plastic bottles are used for soft drinks.

1973 The PET (Polyethylene Terephthalate) bottle created.
1974 the stay-on tab invented. Introduced by the Falls City Brewing Company of
Louisville, KY.
1979 Mello Yellow soft drink is introduced by the Coca-Cola Company as
competition against Mountain Dew.

1981 the "talking" vending machine invented.

34
 THEORITICAL FRAME WORK

Marketing, more than any other business function, deals with customers. Understanding,
creating, communicating, and delivering customer value and satisfaction are at the heart of
marketing thinking and practice. The simplest definition of marketing is Marketing is the
delivery of customer satisfaction at a profit. The two fold goal of marketing is to attract new
customers by promising superior value and to keep current customers by delivering satisfaction.

Marketing must be understood not in the old sense of marketing a saletelling and selling
but in the new sense of satisfying customer needs. Selling occurs only after a product is produced.
By contrast, marketing starts long before a company has a product. Marketing is the home work
that managers undertake to asses needs, measure their extent and intensity, and determine whether
a profitable opportunity exists. Marketing continues throughout the products life, trying to find
new customers and keep current customers by improving product appeal and Performance,
learning from product sales results, and managing repeat performance.

Marketing definition:

A social and managerial process where by individuals and groups obtains what they need and want
Through creating and enhancing products and value with others.

Almost every marketing text book has a different definition of the term marketing.
The American Marketing Association (AMA) uses the following: The process of
planning and executing the conception, pricing, promotion and distribution of ideas, goods and
services to create exchanges that satisfy individual and organizational objectives. From this
definition we see that: marketing involves an ongoing process. The environment is dynamic. This
means that the market tends to change what customers want today is not necessarily what they
want tomorrow.
For example, sales of beef are declining in the United States because consumers have
become health oriented. Similarly Tupperware parties are less popular today than they were
because there are fewer housewives who do not work outside the home. This process involves both
planning and implementing (executing) the plan.

35
Introduction:

We are now focusing on the major elements of the marketing mix; the ingredients of the
marketing mix. Product planning refers to the systematic decision making related to all aspects of
the development and management of a firms products including branding and packing. Each
product includes a bundle attributes capable of exchanging and use.

Product Definition:

A product is a good, service, or idea consisting of a bundle of tangible and intangible

attributes that satisfies consumers and is received in exchange for money or some other unit of
value.

Differences between Goods and Services:

Goods are tangible. You can see them. Feel them, touch them etc. Services are intangible.
The result of human or mechanical efforts to peopleor objects.

Major Distinguishing Characteristics of Services:

Intangibility- Major Component of a service is intangible.

Perishability- Many cannot be stored for future sales Air lines/Amusement ride
Number of hair cut hours in one week: i.e., if Christies employs 3 people, who
work forty hours per week, they have potentially 120 hair cut hours to offer.
Inseparability- Customer contact is often the integral part of the service. Legal
services/hair dresser, therefore often a direct channel of distribution.
Variability- In service quality, lack of standardization, because services are
labor intensive.

There are 3 levels of products:

Core product Marketers must first define what the core BENEFITS the
product will provide to the customer.
Actual product Marketer must then build the actual product around the core
product.

36
 May have as many as five characteristics:

Quality level
Features
Brand name
Packaging
Warranty
Customer training

Example:
Core The ability to take video pictures conveniently.
Actual Sony Handy cam (brand name), packaged, convenient design so you
can hold it, play back features etc. that provide the desired benefits, high quality
etc.
AugmentedReceive more than just the camcorder. Give buyers a warranty on
parts and workmanship, free lessons on how to use the camcorder, quick repair
service when needed and toll free telephone number when needed.

Marketers must first identify the core consumer needs (develop core product), then design
the actual product and find ways to augment it in order to create the bundle of benefits that will best
satisfy the customer.

Classifying Products:

Products can be classified depending on who the final purchaser is. Components of the
marketing mix will need to be changed depending on who the final purchaser is. Consumer
products: destined for the final consumer for personal, family and house hold use. Business to
business products: are to satisfy the goals of the organization. The same product can be purchased
by both, for example a computer, for the home or the office.

Some of the main issues involved include:

Marketers help design products, finding out what customers want and what can practically be
made available, given the technology and price constraints. Marketers distribute products there
must be some efficient way to get the products from the factory to the end customer.

37
 Marketers also promote products, and this is perhaps what we think of first when we think of
marketing. Promotion involves advertising and much more. Other tools to promote products
include trade promotion (store sales, coupons, and rebates), obtaining favorable and visible shelf-
space, and obtaining favorable press coverage.
Marketers also price products to move them. We know from economics that, in most cases,
sales correlate negatively with pricethe higher the price, the lower the quality demanded. In
some cases, however, price may provide customer with a signal of quality. Thus, the marketer
needs to price the product to (1) maximize profit and (2) communicate a desired image of the
product.

Marketing is applicable to services and ideas as well as to tangible products. For example,
accountants may need to market their tax preparation services to consumers.

Reasons for studying marketing:

There are several good reasons for studying marketing. First of all, marketing issues are
important in all areas of an organizationcustomers are the reasons why business exists! In fact,
marketing efforts (including such services as promotion and distribution) often account for more
Than half of the price of a product. As an added benefit, studying marketing often helps us
become more savvy consumers.

We will learn, for instance, that the per unit of a bigger one is frequently higher than that of a
smaller one, and that more expensive products are frequently not better in quality.

Retailing:

Introduction:

Retailing included all the activities involved in selling goods or services directly to the final
consumers for their personal non-business use. Any organization that does think selling whether a
manufacturers, wholesalers or retailers is doing retailing. It does not matter how the goods or
services are sold (in a store on the streets or in the customers homes) on the other hand a retailer
or retail stores is an business enterprises who sales volume primarily from retailing. Retailing is
one of the major upcoming industries in India.

38
Type of Retailers:

Store Retailers
Non-store Retailers
Retail organization

1) Store Retailers:
Customer today can shop for goods and services from a wide variety of stores. The
most important retails stores types are:

a) Specialty stores:

A specialty store carries a narrow product line with a deep assortment with in that line.
Examples are furniture stores, florists and book stores.

b) Department Stores:
A department stores carriers several product lines with a deep assortment with in that
line. Typical examples of which are clothing, home furnishing and house hold garden. Here
each line is operated as a separate department, managed by specialist buyers or merchandisers.
c) Super Markets:
A super market is relatively a large low cost, low margin, high volume, and self- service
operation design to serve the customers total needs for food, laundry and house hold
maintenance products.

2) Non-store Retailing:
These are three types,
Direct selling
Automatic vending
Buyingservice
3) Retail organization:
Although many retail stores are independently owned, an increasing number is falling
under some form of corporate retailing. The five types of corporate retailing and corporate
chains, voluntary chains, and retail co-operatives, consumer observation franchise
organizations and merchandising conglomerates.

39
 Keeping the important role played by the retailers in mind, 50 retailers are selected
random sampling basis from all over Vijayawada city.

Customer Satisfaction:

Introduction:

The consumers from expectations about the value of marketing offers and make buying
decisions based on these expectations. Customers satisfaction with a purchase depends on the
products actual performance relative to a buyers expectations.
A customer might experience various degree of satisfaction. If the products performance
falls short of expectations, the customer is dissatisfied. If the products matches expectations, the
consumer is satisfied. If performance exceeds explanations, the customer is highly satisfied or
delighted.
But how does buyers from their expectations? Expectations are based on the customers
past buying experiences, the opinions of friends and associates, and marketer and competitor
information and promises. Marketers must be careful to set the right level of expectations. If they
set expectations too low, they may satisfy those who buy fail to attract enough buyers. In
contrast, if they raise expectations too high, buyers are likely to be disappointed.

The American consumer satisfaction index, which tracks consumer satisfaction in more
than two dozen U.S manufacturing and service industries, shows that overall consumer
satisfaction has been declining slightly in recent years. It is unclear whether this has resulted from
a decrease in product and service quality or from an increase in customer expectations. In either
case, it presents an opportunity for companies that can consistently deliver superior customer
value and satisfaction.

Todays most successful companies are raising expectations and delivering performance to
match. These companies embrace total customer satisfaction. For example, Honda claims, One
reason our customers are so satisfied is that we arent.

Cigna vows 100% satisfaction. 100% of the time. Such companies track their customers
expectations, perceived company performance, and customer satisfaction. However, although the
customer-centered firm seeks to deliver high customer satisfaction relative to competitors, it does
not attempt to maximize customer satisfaction.

40
 A company can always increase customer satisfaction by lowering its price or increasing its
services, but this may result in lower profits. Thus, the purpose of marketing is to generate
customer value profitability. This requires a very delicate balance: the marketer must continue to
generate more customer value and satisfaction but not give away the house.
Why it is so important to satisfy the customer? Such satisfaction is important because a
companys sales come from two basic groups new customers and retained customers. It usually
costs more to attract new customers than to retain current ones, and the best way to
retain current customers to keep them satisfied.

Customer satisfaction is a key to making lasting connections with customers-to keeping

and growing consumers reaping their customer life time value. Satisfied customers buy a product
again, talk favorably to others about the product, pay less attention to competing brands and
advertising, and buy other products from the company, many marketers go beyond merely
meeting the expectations of customers-they aim to delight the customer. A delighted customer is
even more likely to purchase again and to talk favorably about the product and company.

Highly satisfied customers produce several benefits for the company. Satisfied customers
are less price sensitive, talk favorably to others about the company and its products, and remain
loyal for a longer period. However, the relationship between customer satisfaction and loyalty
varies greatly across industries and competitive situations.

The following figure shows the relationship between consumer satisfaction and customer
loyalty in five different markets. In all cases, as satisfaction increases, as does loyalty. In highly
competitive markets, such as those for auto mobiles and personal computers there is surprisingly
little difference between the loyalty of less satisfied customers and those who are merely
satisfied.

However, there is a tremendous difference between the loyalty of satisfied customers and
completely satisfied customers.

Even a slight drop from complete satisfaction can create an enormous drop in loyalty. For
example, one study showed that completely satisfied customers are nearly 42 percent more likely
to be loyal than merely satisfied customers.

41
 Another study by AT&T showed that 70 percent of customers who say they are satisfied
with a product or service are still willing to switch to a competitor, customers who are highly
satisfied are much more loyal. Xerox found that its totally satisfied customers are six times more
likely to repurchase Xerox products over the next 18 months than its satisfied customers. This
means that companies must aim high if they want to hold on to their customers.

Customer delight creates an emotional affinity for a product or service, not just a rational
preference, and this creates high customer loyalty. A dissatisfied customer responds differently.
Whereas, on average, a satisfied customer tells 3 people about a good product experience, a dis
satisfied customer grips to 11 people. In fact, one study showed that13 percent of the people who
had a problem with an organization complained about the company to more than 20 people.

Clearly, bad word of mouth travelers farther and faster than good word of mouth and can
quickly damage consumer attitudes about a company and its products. Therefore, a company
would be wise to measure customer satisfaction regularly. It cannot simply rely on dis satisfied
customers to volunteer their complaints when they are dis satisfied.

Some 96 per cent of unhappy customers never tell the company about their problem.
Companies should setup systems that encourage customers to complain. In this way, the
company can learn how well it is doing and how it can improve.

The 3G Company claims that over two-thirds of its new products ideas come from listening
to customer complaints. But listening is not enoughthe company also must respond
constructively to the complaints it receives.

Alphabet P - Product, Price, Place, and Promotion. Each one of these Ps including many
marketing variables. A part from this four factor classification by Mc McCarthy there are two
other important classifications of the marketing-mix variables or marketing activities. One is
proposed by Albert W. Frey which categories all marketing decision variable by two factors the
offering (product, packaging brand, price and service) and methods and tools (distribution
channels, personal selling, advertising, sales promotion and publicity).

Mc Cathys classification, in the form of the summation of all variables of marketing-mix

in the four Ps is the most popular one. These four variables or components of the marketing-mix
are also alternatively describes as: Product-mix, pricing strategy, distributingmix, and
communication-mix.

42
 In each of the marketing mix elements or the four Ps- product, price, place and
promotion there are several elements. For example, packaging is one of the sub elements of
product and transportation is one of the sub-elements of place or distribution. The complete
set of marketing mix elements and sub-elements is presented in the chart below. The
marketing mix variables are the four Ps of marketing:

Importance of Marketing:

A market in general may be described as a place or geographical area where buyers and
sellers meet and functions, good or services are offered, are goods or service are offered for sale
and transfers ownership of titles occur.

According to Phillip Kottler marketing is specifically concerned with how transactions

are created, stimulated facilities and valued.
E. F. L. breach has defined marketing is the process of determining demand for a
product or services. Motivation its sales and distribution it into ultimate consumption at a profit.

A high level of economic activity is a prerequisite for a high level of economic activity. It
has been aptly remarked. Nothing happens until somebody sellers something.

At present the urgency in for increased marketing and not merely for increased
production. This alone shows the importance of marketing as a potential force that commands
high significance for societyas a whole. The following points will satisfy to this fact.

The nation in come is composed of goods and services which money can buy. Any
increase in the efficiency of marketing really results in a lower price to consumers mean areal
increase in the national income.
It is marketing, which was conversed yesterdays luxuries into todays necessaries.
Marketing converts latent demand into effective demand. I did my project work in ROAP
on marketing-mix is consists of A.P.s they are product price and promotion.

43
Product Variables:

Product line and range.

Design quality, features, models, style, appearance, size and warranty of
products.
Packaging type, materials, size, appearance and label.
Branching and trade mark.
Merchandising.
Service, pre-sale and after-sale.
New products.

Price Variables:

Pricing policies, levels of prices, level of margins, discounts and rebates.

Terms of delivery, payments terms, credit terms and installment facilities.
Resale price maintenance.

Place Variables:

Channels of distribution, types of intermediaries, channel policy and design, location of

outlets, channel remuneration and dealer-principalrelations. Physical distribution, transportation,
ware housing inventory levels, order processing etc.

Promotion Variables:

Personal selling, objectives, level of efforts, quality of sales force, cost

level, level of motivation.
Advertising, media-mix, budgets, allocations and programmes.
Sales promotional efforts, display, contests, trade promotion.
Publicity and public relations.

44
 Product:
Meaning and definition of product:

Before we discuss various aspects of product management and their significance in

marketing management, it would be appropriate here for us to fully understand the concept of
product. We have mentioned earlier that Phillip Kottler has defined product in these words: A
Product is anything that can be offered to a market for attention, acquisition, use or consumption
That might satisfy a want or need. It includes physical objects, services, persons, organizations
and ideals.in the view of Wrote Alderson, A product is a bundle of utility consisting of various
product features and accompanying services.

The bundle of utilities in this definition refer to the physical and psychological
satisfactions that the buyers seek and the sellers selling a particular product offer in the
combination of its various features and the services associated with it.

William J. Stanton states A product is a set of tangible and intangible attributes,

including packaging, color, price, manufactures prestige, and manufacturers and retailers
services which the buyer may accept as offering want satisfaction. In this definition a product is
viewed as a set of tangible as well as intangible qualities properties that satisfy the consumers
needs, wants or desires, rather than merely a thing. It indicates the fact that in buying a product
the consumers purchase something more than a set of physical attributes they buy want-
satisfaction, problem-solution or need-fulfillment.

A product has three levels. The first and the most fundamentals is the core product
which is in the center of the total product and answers the question as to want do the consumers
really buy while buying different products. A consumer does not busy physical object, he/she buys
a solution to some problem faced by him/her and the product he/she buys is, in fact, the packaging
or a problem-solving service.

For example, women buying lipstick is not simply buying lip color, she is buying hope,
the hope to look beautiful and attractive and an old man buying eye glasses is not merely buying
the glasses and he frames, he is buying eyesight assistance. The marketers job is to uncover
needs hiding under every product and to sell benefits not features.

45
 The product planner has to turn the core product into a tangible product like lipstick or
eye glasses which have five characteristics, viz., quality, features, styling, brand-name and
packaging.

Pricing:

Every marketer and organization, whether a (profit seeking organization or a non-profit

organization, has to set a price for its products/services price is the value of a product or service
expressed in monetary terms. It is the consideration which the buyer has to give to the seller for
Purchasing a product or utilizing a service. In our life, we are concerned with price in different
ways. We pay the bill of the provision store for the purchases from it, rent to the land lords in
whose building we live, fee to the doctor when we consult him and bus fair to the conductor
when we travel by a bus. All these are the prices of different products and services we consume
or utilize. The salary of a business executives or a lecture in a college is the price of his services
and the wage paid to a laborer is the price of the work done by him.

Importance of Pricing:

Price is an important element of the marketing-mix of a company. It is the only element

in the marketing-mix that products revenue, the other elements represent costs or expenses. It can
be used as a strategic marketing variable to meet competition. It is an important weapon in the
Marketing harmony of a company to fight with the competitors price is highly perceptible to
consumers or customers and therefore significantly affects their decision to buy a product or
service. It is factor that directly determines the volume of sales.

Factors influencing Pricing:

Two categories of factors internal factors and environment or external factors-influence

the pricing decisions of any company. In each of these categories, some may be economic factors
may be quantitative and yet others qualitative.

46
Internal factors:

The firm has certain objectives long-term and immediate in pricing. For example, it has
various costs of manufacturing and marketing and it seek store cover these costs through the
price. The firm may also seek to project a particular public image through its pricing policies. It
may have a basic philosophy on pricing. The pricing decisions of the overall objectives of the
firm. All these constitute the internal factors that influence pricing more over; pricing strategy has
to fit into the overall marketing strategy. It cannot exist independently. In these, overall
marketing strategy is another internal factor that influences pricing.

External factors:

In addition to all internal factors mentioned above, any business firm has to encounter a
set of external actors while formulating its pricing strategy. In the first place, the nature of the
economy and the nature of completion have to be reckoned with. The purchasing of the consumer
as well as consumer behavior in the larger sense of the term also has to be reckoned with. In
countries like India, the state exercises a lot of influence on price decisions in respect of a large
variety of products.

It includes a direct price controls through statutorily fixed maximum selling as well as
indirect pressures to hold the price line at certain levels. Such external dimensions also have to be
reckoned with while making the pricing decision. A list of internal and external factors which
exercises an influence on pricing is given below:

Discount and allowance policy:

Next important pricing policy is the policy regarding discounts and allowances which
most companies offer to their customers with a view to rewarding them for certain acts, such as
early payment of the dues, purchases in larger quantities, off-season differentials in which the
price actually charged to the customers is different from the through discounts and allowances
are:

To accommodate different circumstance purchases.

To provide incentives to buy.
To meet competitive pressure.

47
 To compensate buyers for the loss of some value satisfaction. Some important price
discounts and allowances are briefly described below.

Cash Discounts:

Cash discount is a deduction from the invoice price allowed to all these customers who
pay their bills with in a stipulated time period. Thus it is a reward for prompt payment intended to
en courage cash inflow. For instance, 2/10, net 30, which means that the payment is due within
30 days but the customer can deduct 2% from the cost if he pays the bill within 10 days. It is
more useful when money market is tight. It improves the sellers liquidity and reduces credit
collection costs and bad debts.

Trade Discount:

Trade discount is offered by the manufactures to trade channel members, viz.., whole
sealers, retailers, dealers, etc., who perform certain functions such as selling, storing and record
keeping. It is also called functional discount. Manufacturers must offer the same trade discount
with in each distribution channel. The purpose of this discounts to compensate the distribution
channel members for the services rendered by them. It is advantageous to the manufacturing
company, as the intermediaries who may be otherwise reluctant to join the distribution
channel of the company can be persuaded to do so.

If the trade discount is large, the retailers may passion a part of it to the consumer may
result in greater sales volume.

Quantity Discount:

Another common discount is quantity discount which is deduction from the quoted price
allowed to all customers who buy up to a certain stipulated quantities or more than that. Its
purpose is to encourage customers to buy in larger quantities or to make most of their purchases
from the same company. The discount is based on the size of the purchase either in rupees or in
units. Quantity discount may be non-cumulative based upon the size of an individual order, or
cumulative based on, the total volume purchased by a customer over a period of time.

48
 Quality discount is beneficial to the manufacturers in many ways. It stimulates large
orders, which result in greater sales and reduction of manufacturing, selling, and inventory and
transportation costs. It ensures consistent order booking and there by avoids seasonal or periodic
rush during the slack season. But this discount creates some problems and difficulties as well. It
creates resentment among the marginal buyers and demoralizes them.

Seasonal Discount:

Seasonal discount is a price reduction to buyers who buy a product or service out of
season. It is very common in fan, refrigerator and hotel industries. It helps the manufacturers to
maintain a steady production throughout the year.

Price-changes:
Discussed the major pricing policies and strategies in the preceding section we shall now
study the changes that have to be made by the marketers in their price from time to time. A
company will face various occasions when it will want to cut or raise the prices of its as discussed
here under.

Price Cuts:
The circumstances which lead a company to consider cutting its price are: when it has
excess production capacity lying idle. When it market shares is falling; and it wants to, dominate
the market through lower costs and price.
Price Increase:

Companies may have to increase their prices under some circumstances including:
Persistent cost inflation.
When there is over demand for the companys product which it cannot meet fully.
A company should explain the customers the reason for raising the price, so that it
acquiring the image of a price gouger, exploiter, and profiteer.

Unit Pricing:
It is a retail price-information strategy, usually employed by supermarkets. Under it for
each separate product and package size there is a shelf label that states:

49
 The price of the package.
The price expressed in rupees and price per Kg., liter or some other stand measure.
The shelf labels in unit pricing provide consumers with price information.

Price Lining:
Price lining is a common practice among the retailers of apparel of different types.
Under it a limited member of prices are selected at which a store will sell its items. For examples,
ready-made cloth store may sell some style of frocks at Rs.99.50, other group of styles at Rs.199.50
and a third group of frocks at Rs.299.50. it is beneficial to the consumer, as it simplifies buying
decision. It is helpful to the retailers in planning their purchases.
Place:
Most of the goods and services available in Indian economy today are produced in a few
locations to obtain the cost advantages of large scale production. Ahmadabad, Bombay and
Coimbatore account for a large percentage of the textile mills. Yet buyers of cloth are widely
dispersed: this creates the needs for the distribution function-a way of connecting producers with
consumers.
These possibilities are present:
Each consumer can go directly to the producers.
Intermediaries can help perform the activities necessary to link suppliers with consumers.
Each producer can go directly to consumers of his products of services.

The Marketing system contains examples of all the above three approaches. Due to the
costs involved and the types of services desires by consumers, for many goods or services, the
direct produces-consumer exchange is simply not feasible. Distribution channels fill this gap
between producers and consumer. Channel is a path, distribution channel are the path through
which goods and title to them, flow from producer to consumer.
Distribution channel create three types of utility time, place and possession (or
ownership) while performing their functions. Creation of time utility takes place when the
distribution channel stock the products and release them-when the customer want to purchase them.

50
 Place utility results when products arid services are made available at locations convenient
to consumer, possession (or ownership) is conveyed to the buyer through distribution channels
when goods are sold and delivered or handed over to him.
Distribution channels are also known as markets channels. Let us consider few definitions
of distribution channel J.C. Gandhis definition is comprehensive as it includes all the elements of
distribution, namely, the path or route or process, as the marketing intermediaries, their functions
and the flow of goods and services.

Classification of Intermediaries:

The traditional marketing channel for consumer goods proceeds from manufacture to
whole sealer to retailer to user. The retailer do not found in industrial channel. Retailer sales are
characteristics only of consumer goods. Direct marketing channel is the simplest. It is much more
important in the industrial market. Most major installations and accessory equipment and even
fabricated parts and raw materials are marketed through direct contacts between buyer and seller.

Some of the channel alternatives available to the marketing manager are:

Manufacture to consumer or industrial user.
Manufacture to wholesaler to retailer to consumer or industrial user.
Manufacture to wholesaler to individual user.
Manufacture to agent to wholesaler to retailer to consumer or individual user.
Manufacture to agent to wholesaler to semi-wholesaler to retailer to industrial user.
Manufacture to agent to industrial user.
Manufacture to retailer to consumer.

Channel Design:
The design of channel system is a decision that is made infrequently. However, an
understanding of channel design and of the methods of evaluating and selecting channel
participants is necessary for channel management. Channel decision represents more long term
commitment than the other marketing decisions. It is so, because of time, costs and intermediary
relationships that are involved in building a new channel or in gaining access to an established one.
Changing channels is often a highly risky occurrence and hence, not frequently restored.

51
Channel Objective:
Channel strategy must follow, from channel objectives. The channel objectives are
derived from an analysis of the service output levels desired by the end-users and management
over-all long-run goals.
Channel objectives specify what the channel is expressed to accomplish with regard to a
firms target markets and support of the firms marketing program me. These objectives must
include channel performance, extent of control, financial support to be provide in channel
development and other considerations including returns on the investment, market share, sales
growth, profit and contribution targets channel to be used, designing the specific configuration,
selecting its participants and managing it to achieve the organizations objectives.

Promotion:
The last P in the marketing mix stands for Promotion which is used to inform and
persuade the market regarding a companys products or services. The important promotional
activities are advertising. Personal selling, sales promotion and publicity. The aims of the activities
are to communicate the merits of the product and to encourage the target customers to buy it.

Meaning and Objectives of Advertising:

The word Advertising has been derived from Latin term advertise containing to turn to
Advertising is a paid communication as the advertiser is required to pay for the apace and time. It is
a major promotional tool. According to Mr. P. White, Advertisement is a purchased publicity,
directed according to a definite plan to secure, maintain and increase the distribution and
consumption of a product. The committee on advertising of the American Marketing Association
has defined advertising has any paid form non-personal presentation and promotion of ideas,
goods or services by an identified sponsor.
Functions of Advertising:
Advertising may promote either a brand or the firm selling that brand. It may be either
institutional advertising or product advertising. Institutional advertising does not attempt to sell a
particular product. It builds towards an organization. Thus institutional advertising convinces the
customers that the company citizen takes ecologically responsible action and is an affirmative-
action employer. It is a method of introducing sales persons and new products to consumers.

52
Media of Advertisement:
Press advertising
Film advertising
Radio advertising
Television advertising
Transit advertising
Sales Promotion:
According to the American Marketing Association sales promotion are those marketing
activities, other than personal selling, advertising, and publicity that stimulate consumer purchasing
and dealer effectiveness, such as display shows and exhibitions, demonstrations and various other
non-recurrent selling efforts not in the ordinary routing.
Sales Promotion Tools:
Consumer promotion tools
Samples and coupons
Premiums
Price-off offers
Money refund offers
Contests, sweepstakes and games
Demonstrations
Trading stamps

Publicity and Personal Selling:

Meaning of Publicity:

Publicity has been derived as The activity of securing editorial space, as discovered
from paid space, in all media read, viewed or heard by a companys customer or prospects, for the
specific purpose of assisting in the meeting of sales goals. To the extent that an organization can
create events, news around a marketable entity. It is using publicity. Publicity is part of lager
concept-public relations. Todays relations practitioners perform the following functions.
Press relations
Product publicity
Corporate communication
News
53
 Stimulus for sales force and dealers

Importance of Personal Selling:

Personal selling is one of the most important functions needed for survival and growth of
organizations. Sales persons can accomplish difficult, almost impossible things which are not
possible through advertising, sales promotion, publicity and public relations. They can tailor
messages to the characteristics and desired of particular prospects and modify ongoing
presentations in accordance with the feedback from the prospects. They are in a position to ask for
an order at a strategic time and if turned down can communicate further, in an effort to recoup and
obtain order. It is much easier to ignore or say no to an advertisement or a display than to a
salesperson. Personal selling gains importance as it pinpoints to the prospects, attracts their
attention and creates interest among them by demonstration the product. Two-way communication
of buyer and seller helps to take the sales talk closer to the sales point.

54
 DATA ANALYSIS
The study has been done in the form of a comparative study of Pepsi & Coke. Data has
been collected from the retailers of various outlets with the help of a structured questionnaire. A
sample of 50 outlets has been taken for the study. Comparative study is a technique that helps the
firm to find out purchasing pattern of retailers and also market shares of Pepsi & Coke.

CONTRIBUTION OF OUT LETS IN A SALE OF SOFT DRINKS:

Generally people tend to buy soft drink at the nearest outlet. So the manufacturer has the
responsibility to serve the consumer with a soft drink whenever and wherever he wants. In order to
serve the consumer best it is necessary to know the contribution of outlets through which their
production reaches the ultimate consumers. The retailers in Vijayawada can be broadly classified
into six types. Nearly 150 outlets were located in the town, in which 50 outlets have been taken for
the survey. Table shows the contribution of the outlets in sale of the soft drinks in Vijayawada
town.

Types of Outlets:
Pan shops
Bakery
General/departmental stores
Cool drink shop
Hotel/ ice cream parlor
Bar and restaurant

Company wise market share of soft drinks in Vijayawada city:

In Vijayawada, there are two major brands of soft drinks, which are available in market,
together holding a market share of almost 98%. These soft drinks compete themselves for higher
market shares.

The Pepsi products are available under the brand names of Pepsi, Miranda-O, Miranda-
L, 7up, slice, and Lehar evenness soda, Aquafina water. The Coke products under the brand
names of Coca-Cola, Thums Up, Limca, and Fanta, Sprite, and Kinely soda are available in
Vijayawada town.
55
 In order to evaluate the market share of each brand to the total stock of soft drinks,
retailers were asked to give information regarding the stock of each brand (study was made using
bottles as a measureof comparison).

From the analysis of retailers stock, it was found that Pepsi has a market share of 42%,
while the rest of 58% goes to Coke.

56
 DATA ANALYSIS AND INTERPRETATION

1. From which distribution channel you receive better service?

Table-1:

S.No RESPONSE No. Of. percentage

RESPONDENCE
1 Pepsi 45 90%

2 Coca-Cola 5 10%

Total 50 100%

Graphical Representation: 1

No.Of.RESPONDENCE

Pepsi
Coca-Cola

Interpretation:

Among the sample size of 50 retailers, the 90% people said that the delivery of Pepsi
provides better service, and the remaining 10% people said that the delivery of Coca-
Cola provides better service.

57
2. Who have the highest market share?
Table-2

S.No RESPONSE No. Of. percentage

RESPONDENCE
1 Pepsi 20 40%

2 Coca-Cola 30 60%

Total 50 100%

Graphical Representation: 2

No.Of.RESPONDENCE
30

20

10 No.Of.RESPONDENCE

0
Pepsi
Coca-Cola

Interpretation:
Among the sample size of 50 retailers, 40% people are purchase their products from
Pepsi and remaining 60% people from Coca-Cola.

58
3. Which one have better taste?
Table-3:

S.No RESPONSE No. Of. percentage

RESPONDENCE
1 Pepsi 20 40%

2 Coca-Cola 30 60%

Total 50 100%

Graphical Representation: 3

No.Of.RESPONDENCE

Pepsi
Coca-Cola

Interpretation:

Among the sample size of 50 retailers, 40% people agree Pepsi products are tasty
ones, and remaining 60% people agree Coca-cola products are tasty ones.

59
 4. Which one provides better or best Quality?
Table-4:

S.No RESPONSE No. Of. percentage

RESPONDENCE
1 Pepsi 43 86%

2 Coca-Cola 7 4%

Total 50 100%

Graphical Representation: 4

No. Of. RESPONDENCE

60

40

20 No. Of. RESPONDENCE

0
Pepsi
Coca-Cola

Interpretation:

Among the sample size of 50 retailers, 86% of people said that the Pepsi provides best quality, and
the remaining 4% people said that the Coca-cola provides better quality.

60
 5. Which company provides better promotional activities?

Table-5:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 35 70%

2 Coca-Cola 15 30%

Total 50 100%

Graphical Representation: 5

No. Of. RESPONDENCE

40

20
No. Of. RESPONDENCE
0
Pepsi
Coca-Cola

Interpretation:

Among the sample size of 50 retailers, 70% people agree Pepsi provides better promotional
activities, and remaining 30% people provides better promotional activities from Coca-Cola.

61
 6. Which company provides better Credit Policies?
Table-6:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 10 20%

2 Coca-Cola 40 80%

Total 50 100%

Graphical Representation: 6

No. Of. RESPONDENCE

40

20
No. Of. RESPONDENCE
0
Pepsi
Coca-Cola

Interpretation:

Among the sample size of 50 retailers, the Pepsi provides 20% people to credit policies and remaining
80% people are from Coca-Cola.

62
 7. Which company provides better Discounts?
Table-7:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 49 98%

2 Coca-Cola 1 2%

Total 50 100%

Graphical Representation: 7

No. Of. RESPONDENCE

60

40
No. Of. RESPONDENCE
20

Interpretation:

Among the sample size of 50 retailers, the Pepsi provides 98% of outlets are vastly reacting about
Pepsi and remaining 2% of outlet support with coca-cola.

63
 8. Which product of Pepsi gives highest retail Market?
Table-8:

S.No Products No. of. Percentage

Respondents
1 Pepsi 10 20

2 7up 20 40%

3 Slice 10 20%

4 Miranda orange 5 5%

5 Lemon Miranda 0 0%

6 Nimbooz 0 0%

7 Mountain Due 4 2%

8 Lehar Soda 4 2%

9 Aquafina Water 7 10%

Total 50 100%

Graphical Representation: 8

percentage
Pepsi
7up
slice
miranda orange
miranda lemon

Interpretation:

Among the sample size of 50 retailers the 7up got highest market share 40%, and Pepsi, slice got
20%, M orange got 5%, mountain Dew and Lehar soda got 2% of each and Aquafina water got
10%.

64
 9. Which product of Coca-Cola gave highest retail Market?
Table-9:

S.No Products No. of. Percentage

Respondents
1 Thumsup 15 30%

2 Sprite 15 30%

3 Fanta 7 10%

4 Limca 10 20%

5 Minute made 7 10%

6 Kinely soda 7 10%

7 Maaza 7 10%

Total 50 100%

Graphical Representation: 9

percentage
thumsup
sprite
fanta
limca
minute mide
kinely soda

Interpretation:

Among the sample size of 50 retailers the two products Thumsup and Sprite got equal retail market
share with30% each, Limca got 20%, Fanta, Minute maid, Kinely soda Maaza got 10% each .

65
 10. Which product gives highest position in retail world based on two brands?

Table-10:

S.No Products No. of. Percentage

Respondents
1 Pepsi 10 20%

2 7up 10 20%

3 Aquafina water 5 5%

4 Thumsup 20 40%

5 Sprite 4 3%

6 Maaza 3 2%

7 Lehar Soda 7 10%

Total 50 100%

Graphical Representation: 10

percentage
Pepsi
7up
thumsup
sprite
maaza
lehar soda

Interpretation:

Among the sample size of 50 retailers the Thumsup got highest retail market share with 40%, Pepsi,
7up got equal market share 20%, Lehar soda got 10%, Aquafina water got 5%, sprite got 3% and
Maaza got 2%.

66
 11. Which company have highest brand image?

Table-11:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 10 20%

2 Coca-Cola 40 40%

Total 50 100%

Graphical Representation: 11

No. Of. RESPONDENCE

40
30
20
No. Of. RESPONDENCE
10
0
Pepsi
Coca-Cola

Interpretation:

Among the sample size of 50 retailers, the Pepsi got 20% of people and remaining 80% of people
select Coca-Cola have highest brand image.

67
 12. Who are the major customers of Pepsi?

Table-12:

S.No Category Result No. of. Percentage

Respondents
1 Professionals Yes 30 60%

2 Employees Yes 20 40%

3 Daily workers No 0 0%

4 Children No 0 0%

5 Others No 0 0%

Total 50 100%

Graphical Representation: 12

result
50

0
result

Interpretation:

Based on 50 retailers, we got two categories are major customers of Pepsi they are, professionals, and
Employees with 60%, 40%.

68
 13. Who are the major customers of Coca-Cola?

Table-13:

S.No Category Result No. of. Percentage

Respondents
1 Professionals No 0 0%

2 Employees No 0 0%

3 Daily workers Yes 50 100%

4 Children No 0 0%

5 Others No 0 0%

Total 50 100%

Graphical Representation: 13

result
50

0
result

Interpretation:

Based on 50 retailers, we got Daily workers are the major customers of Coca-Cola with 100%.

69
 14.Who is suffering from Seasonal fluctuations?
Table-14:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 0 0%

2 Coca-Cola 50 100%

Total 50 100%

Graphical Representation: 14

No. Of. RESPONDENCE

40
30
20
No. Of. RESPONDENCE
10
0
Pepsi
Coca-Cola

Interpretation:

Based on 50 retailers, they said there are no seasonal fluctuations from Pepsi and fully suffering from
Coca-Cola.

70
 15.Who is provides better pricing offers?
Table-15:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 49 98%

2 Coca-Cola 1 1%

Total 50 100%

Graphical Representation: 15

No. Of. RESPONDENCE

60

40

20 No. Of. RESPONDENCE

0
Pepsi
Coca-Cola

Interpretation:

Based on 50 retailers, 98% of peoples are said about Pepsi provides better pricing offers and
remaining 2% of people said about Coca-Cola.

71
 16. From which company retailers suffering for inconvenient?
Table-16:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 0 0%

2 Coca-Cola 50 100%

Total 50 100%

Graphical Representation: 16

No. Of. RESPONDENCE

60

40

20 No. Of. RESPONDENCE

0
Pepsi
Coca-Cola

Interpretation:

Among the sample size of 50 retailers, 100% peoples are suffering for inconvenient from coca-cola.

72
 17. Which companies have effective advertising of their products?

Table-17:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 40 80%

2 Coca-Cola 10 20%

Total 50 100%

Graphical Representation: 17

No. Of. RESPONDENCE

40
30
20
No. Of. RESPONDENCE
10
0
Pepsi
Coca-Cola

Interpretation:

Based on 50 retailers, 80% of people are supports Pepsi have effective advertising of their products
and remaining 20% of people support Coca-Cola.

73
 18.Who provides publicity?

Table-18:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 47 92%

2 Coca-Cola 3 8%

Total 50 100%

Graphical Representation: 18

No. Of. RESPONDENCE

60

40

20 No. Of. RESPONDENCE

0
Pepsi
Coca-Cola

Interpretation:

Based on 50 retailers, 92% of people are said about Pepsi products are better qualitative products and
remaining 8% of people are support with Coca-Cola.

74
 19.Who provides highest quantity in pet bottles?
Table-19:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 25 50%

2 Coca-Cola 25 50%

Total 50 100%

Graphical representation: 19

No. Of. RESPONDENCE

30

20

10 No. Of. RESPONDENCE

0
Pepsi
Coca-Cola

Interpretation:

In this query the two companies Pepsi and Coca-Cola got equal response.

75
 20. Overall, which product you will support?

Table-20:

S.No RESPONSE No. Of. Percentage

RESPONDENCE
1 Pepsi 40 80%

2 Coca-Cola 10 10%

Total 50 100%

Graphical Representation: 20

No. Of. RESPONDENCE

40
30
20
No. Of. RESPONDENCE
10
0
Pepsi
Coca-Cola

Interpretation:

Based on 50 retailers, 80% of peoples support with Pepsi and other 10% of people support with Coca-
Cola.

76
 FINDINGS

Coke having less number of bottling units compared to Pepsi thats why coke has a week
distribution channel.

There are no servicing centers for Coca-Cola at all rural areas.

There is no proper support to help their infrastructure of retailers from Coke.

Retailers are not enthusiastic. Because retailers prefer their profits only.

Inadequate availability of the Brands in Market. In rural areas there is no availability of all
brands regularly.

No replacement of Breakages and Leakages. When the time of transportation there is some
breakages or leakages in glass bottles or pet bottles packing.

No Credit facilities.

There is no proper servicing for Cooler repairs. Company must bear the problems in
maintenance of coolers.

No proper Advertising.

No quick response to the retailers complaint.

77
 SUGGESTIONS

Measures to improve market share of Pepsi.

I. INCREASING THE INCENTIVE TO RETAILERS:

Incentives to the retailers, which in turn can help Pepsi to improve the sales
volume. This will create huge competition among the dealers and motivate them towards sale of
Pepsi.

MAKING ALL THE BRANDS AVAILABLE EVERYWHERE:

Some people argue that the company is not providing all the brands they
have ordered. This has arisen due to unexpected demand. This can be curtailed by providing some
more crates, which have more demand in the respective zones.

.
II. RESPONDING TO THE COMPLAINTS OF THE RETAILERS AND
CONSUMERS IMMEDIATELY:

` Complaints by the dealers and customers serve as feed back to the company
and give it a chance to make amends, In this regard a dormant and passive attitude would, in fact,
give the disadvantage of the company leading to loss of image and reputation. Therefore the
company should deal with complaints promptly and definitely.

III. HELPING THE RETAILERS TO IMPROVE THEIR INFRASTRUCTURE:

Some retailers did not have proper infrastructure like freezing equipments.
Nearly 10% of the retailers out of 548 retailers were not having freezing equipment. Of the
90% of the retailers who are having their freezing equipment nearly 5% equipments were not
in good condition.

It is quite natural that people may refuse to buy a soft drink if it is not
chilled. Some retailers are facing this problem. To cope up with this situation, the company has to
provide freezing equipments like refrigerators and iceboxes and visi-coolers at the retail outlets.

Some retailers are hiring these equipments from others. This is very expensive for any
retailer to put in use. Company should try to avoid these kinds of minor things taking into
consideration better convenience of retailers to establish brand image.

78
 Some retailers are interested in maintaining Visi-coolers, which are supplied by
Pepsi recently if the deposit money is reduced.

IV. INCREASINNG THE SERVICE FREQUENCY:

In fact soft drink manufactures will need a strong distribution network to market
their products. Some retailers argue that the service frequency made by the company is not able to
meet the requirements. So they want regular services.

V. REPLACEMENT OF BREAKAGES AND LEAKAGES:

Retailers are strongly expecting the company to replace the broken and leaked
bottles. Otherwise, the company may lose its goodwill and reputation.

VI. PROVIDING CREDIT TO THE RETAILERS:

It is good to the company to provide credit facility to the major retailer when they are not able
to meet the whole purchasing amount.

VII. PROPER SUPERVISION:

The supervisor must visit the retailers at least twice in a week to identify and respond to the
retailers problems.

79
 CONCLUSION
The global business environment is buzzing with the single most important issue of
building a competitive edge by creating and retaining a large number of customers.
Their goods and services offered by every organization are therefore for seized of the task of
establishing and sustaining its worth to the retailer, who has been rendered unpredictable by
competition.
Therefore every business is making a continuous effort for achieving retailers satisfaction to
attain retailers locality.
In short it is total organizational culture and brand equity, which face challenge.
So that there is a perennial struggle amongst organization to sustain their
existence in the market place, and hence in order to sustain the stiff competition.
The company has to take up market Research frequently to know the changing needs &
preference of the retailers.
This helps the company reframe the policies in providing cutting edge technology to
satisfy the retailer and retain him for a life time.

*****

80
 BIBLIOGRAPHY

S. No Name of The Author Title of the Book Edition

1 Phillip Kottler & Gary Armstrong Principles of Marketing 9th edition

2 Chunawala and Seth Advertising Management ----

3 David. J and Ronald S Rubin Marketing Research 5th edition

4 John R. Rossiter & Larry Percy Advertising & Promotion 8th edition

Management

JOURNALS & NEWSPAPERS:

Business world
Economic Times
A&M
Business India

RELATED WEBSITES:

www.Pepsi.com
PepsiCoHoldings
India Pvt Ltd

81
 ANNEXURE
Retailer Profile:
A. Retailer name :
B.Location :
C.Age :

1. From which distribution channel you receive better service?

a) Pepsi []
b) Coca-Cola []

2. Who have the highest market share?

a) Pepsi []
b) Coca-Cola []

3. Which one have better taste?

a) Pepsi []
b) Coca-Cola []

4. Which one provides better or best Quality?

a) Pepsi []
b) Coca-Cola []

82
5. Which company provides useful promotional activities?
a) Pepsi []
b) Coca-Cola []

6. Which company provides credit policies?

a) Pepsi []
b) Coca-Cola []

7. Which company provides better discounts?

a) Pepsi []
b) Coca-Cola []

8. Which product of Pepsi gave highest retail market?

a) Pepsi []
b) 7up []
c) Slice []
d) Miranda []
e) LemonMiranda []
f) Nimbooz []
g) Mountain dew []
h) Lehar soda []
i) Aquafina water []

9. Which product of Coca-Cola gave highest retail market?

a) Thumsup []
b) Sprite []
c) Fanta []
d) Limca []
e) Minute made []
f) Kinely soda []
g) Maaza []
83
10. Which product gave highest position in retail world based on two brands?
a) Pepsi []
b) 7up []
c) Aquafinawater []
d) Thumsup []
e) Sprite []
f) Maaza []

11. Which company have highest brand image?

a) Pepsi []
b) Coca-Cola []

12. Who are the major customers from Pepsi?

a) Professionals []
b) Employees []
c) Dailyworkers []
d) Childrens []
e) Others []

13. Who are the major customers from Coca-Cola?

a) Professionals []
b) Employees []
c) Dailyworkers []
d) Childrens []
e) Others []

14. Who are suffering from seasonal fluctuations?

a) Pepsi []
b) Coca-Cola []

15. Who provides better pricing offers?

a) Pepsi []
b) Coca-Cola []

84
16. Form which company retailers suffering for inconvenience?
a) Pepsi []
b) Coca-Cola []

17. Which company has effective advertising of their products?

a) Pepsi []
b) Coca-Cola []

18. Who provides better publicity?

a) Pepsi []
b) Coca-Cola []

19. Who provides highest quantity in pet bottles?

a) Pepsi []
b) Coca-Cola []

20. Overall, which product you will support?

a) Pepsi [ ]
b) Coca-Cola [ ]
c) Both [ ]

85
86