PepsiCo Business Strategy and Competitive Advantage Posted on May 1, 2016 by John Dudovskiy PepsiCo mission statement has been worded by CEO Indra Nooyi as ‘Performance with Purpose’ and this principle is closely integrated with the strategic direction chosen for the company. The most prominent aspects of PepsiCo business strategy are based on the following six principles: First, achieving growth through mergers and acquisitions (M&A). M&A can offer the advantages of gaining access to competencies and infrastructure, reducing direct costs and overheads and achieving organic growth. Recently, PepsiCo has completed as a set of important acquisitions such as acquisition of juice and diary businesses Lebedyansky and Wimm-Bill-Dann in Russia, Lucky snacks and Mabel cookies in Brazil, and Dilexis cookies in Argentina. M&A can be specified as one of the cornerstones of PepsiCo business strategy. As a result of an aggressive pursuit of this strategy, today PepsiCo portfolio comprises 22 brands and each of these brands have generated at least one billion USD in retail sales in 2015.[1] Second, forming strategic alliances in the global scale. Specifically, strategic partnerships have been formed with Tingyi in China in order to claim a share in growing beverage market in China. Moreover, formation of a jointventure with Tata in India to enhance drinking water manufacturing capabilities, and initiation of strategic partnership with Almarai in Saudi Arabia can be mentioned to illustrate PepsiCo’s adoption of strategic alliances as an integral part of the corporate strategy. Important strategic alliances are formed by PepsiCo at home markets as well. Specifically, by forming a strategic alliance with Starbucks – a global coffee house chain, PepsiCo has been able to claim its share from increasing energy drink market segment. Third, focusing on emerging markets. An aggressive pursuit of this strategy has had positive impact on the bottom line. The year of 2015 witnessed a double-digit growth in the sales of snacks in China and Pakistan[2] and PepsiCo is also strengthening its position in the Middle East. The company has been able to more than double its e-commerce business in China in 2015.[3] Moreover, A wide range of innovative marketing initiatives developed by PepsiCo marketing team include “Do Us a Flavor” campaign that involved consumers in 17 countries submitting flavor ideas. sometimes even singing along the way”[5] and this fact communicates her willingness to embrace her differences with positive implications on employee morale and organizational culture. actions. PepsiCo CEO Indra Nooyi is widely believed to be an unconventional corporate leader for a good reason. the marketing tagline of “Live for Now” associated with Pepsi brand has been modified as “Yalla Now” and “Oh Yes Abhi” for Middle East and Indian markets respectively taking into account cross-cultural differences associated with these markets. development of Lipton Brisk Star Wars game application for mobile phones. This is meant to be facilitated through sharing supply-chain management and infrastructure. Fourth. Importantly. and “stuff” that clarifies and reinforces what a company truly values”[4] and the nature of organizational culture directly impacts its performance in short-term and long-term perspectives. cross-cultural differences in various markets are taken into account when developing and delivering PepsiCo marketing messages. focusing on organizational culture. . Specifically. Organizational culture can be defined as “the collection of words. Fifth. thoughts.PepsiCo CEO Indra Nooyi has publicly expressed commitments to further increase the level of presence of the company in emerging markets. Sixth. and using celebrity endorsement in an innovative manner by attracting a popular singer amongst Pepsi brand target customer segment Beyonce Knowles. The same message is effectively communicated to organizational stakeholders and integrated into Pepsi Brand as well in a way that the brand marketing message is associated with ‘making the most of the moment’. Indra Nooyi has been striving to increase the level of association of individual brands with PepsiCo company values and philosophy through promoting the idea of One PepsiCo. innovation in marketing initiatives. It has been noted that “she’s been known to walk the halls at Pepsi barefoot. and ‘embracing own individuality’. Being listed among the top 25 ‘World’s Best Multinational Workplaces’ by the Great Place to Work Institute in 2012 and PepsiCo Canada being recognized as one of Canada’s Top 100 Employers for 2014 by Mediacorp Canada Inc[6] can be interpreted as an indication of effective working culture within PepsiCo. For example. developing and promoting the idea of One PepsiCo. operational costs for many brands within PepsiCo portfolio have been decreased. Increasing focus on costs 4. Building new capabilities 3. Exercise discipline when it comes to capital returns . Fostering a culture of collaboration 5. Commercial agenda 2. the senior management focuses on the framework known as ‘5Cs’ to guide PepsiCo business strategy and long-term planning.Moreover. 5Cs stand for the following: 1. Pepsi-cola almost exist anywhere and can be easily purchased by customers. materials and information is the operations management concern in this strategic decision area. PepsiCo’s approach is to diversify and distribute its supply chain hubs. Inventory Management. the company operates supply chain hubs for each regional market. PepsiCo does so through computerized monitoring of inventory. 8. such facilities are located in key areas near most retailers. restaurant. constructed or acquired to support PepsiCo’s growth. KFC and Pizza Hut. PepsiCo optimizes response times to fluctuations in demand. Maintenance. PepsiCo’s inventory management emphasizes automation. PepsiCo is especially interested in large retail outlets and food service establishments with high sales volume. In this way.Om 4. For example. Such an operations management approach is based on this strategic decision area’s objective of maximal reach to target markets. Supply Chain Management. Adequacy. Location Strategy. 5. PepsiCo continues to hire individuals and promotes from within the organization to grow its workforce. layout design in PepsiCo production facilities is centered on the principles of assembly line production and total quality management (TQM). considering the company’s wide array of products and markets. This strategic decision area of operations management focuses on adequate workforce and other resources that grow with the business. Facilities are expanded. Inventory managers can access real-time data to help them make decisions. and cost minimization are the key objectives in this strategic area of operations management. consumers can purchase Pepsi-cola from supermarkets. spaces are designed with efficiency and productivity in mind. Layout Design and Strategy. In PepsiCo’s case. which have partnership with Pepsi. For example. PepsiCo’s maintenance concerns are widely varied. PepsiCo has many company-owned facilities and partner-owned facilities in strategic locations. . . As the good reputation and image was created. 7. scheduling. In PepsiCo’s case. Pepsi-cola brand is already been brought into the mind of the consumers as an invisible image. This strategic decision area focuses on operations management practices that optimize the supply chain to match demand for materials and intermediary products. 10. Efficient movement of people. M&A can offer the advantages of gaining access to competencies and infrastructure. As a result of an aggressive pursuit of this strategy. Important strategic alliances are formed by PepsiCo at home markets as well. and initiation of strategic partnership with Almarai in Saudi Arabia can be mentioned to illustrate PepsiCo’s adoption of strategic alliances as an integral part of the corporate strategy. Specifically. Lucky snacks and Mabel cookies in Brazil. formation of a jointventure with Tata in India to enhance drinking water manufacturing capabilities. and Dilexis cookies in Argentina. today PepsiCo portfolio comprises 22 brands and each of these brands have generated at least one billion USD in retail sales in 2015. Moreover. Specifically. 2016 by John Dudovskiy PepsiCo mission statement has been worded by CEO Indra Nooyi as ‘Performance with Purpose’ and this principle is closely integrated with the strategic direction chosen for the company. forming strategic alliances in the global scale. Recently.[1] Second. strategic partnerships have been formed with Tingyi in China in order to claim a share in growing beverage market in China. achieving growth through mergers and acquisitions (M&A). reducing direct costs and overheads and achieving organic growth. by forming a strategic alliance with .PepsiCo Business Strategy and Competitive Advantage Posted on May 1. M&A can be specified as one of the cornerstones of PepsiCo business strategy. PepsiCo has completed as a set of important acquisitions such as acquisition of juice and diary businesses Lebedyansky and Wimm-Bill-Dann in Russia. The most prominent aspects of PepsiCo business strategy are based on the following six principles: First. An aggressive pursuit of this strategy has had positive impact on the bottom line. focusing on emerging markets. The company has been able to more than double its e-commerce business in China in 2015. Fourth. development of Lipton Brisk Star Wars game application for mobile phones. actions. Fifth. operational costs for many brands within PepsiCo portfolio have been decreased.Starbucks – a global coffee house chain. Being listed among the top 25 ‘World’s Best Multinational Workplaces’ by the Great Place to Work Institute in 2012 and PepsiCo Canada being recognized as one of Canada’s Top 100 Employers for 2014 by Mediacorp Canada Inc[6] can be interpreted as an indication of effective working culture within PepsiCo. sometimes even singing along the way”[5] and this fact communicates her willingness to embrace her differences with positive implications on employee morale and organizational culture. The same message is effectively communicated to organizational stakeholders and integrated into Pepsi Brand as well in a way that the brand marketing message is associated with ‘making the most of the moment’. Specifically. thoughts.[3] Moreover. developing and promoting the idea of One PepsiCo. The year of 2015 witnessed a double-digit growth in the sales of snacks in China and Pakistan[2] and PepsiCo is also strengthening its position in the Middle East. Organizational culture can be defined as “the collection of words. innovation in marketing initiatives. A wide range of innovative marketing initiatives developed by PepsiCo marketing team include “Do Us a Flavor” campaign that involved consumers in 17 countries submitting flavor ideas. Third. This is meant to be facilitated through sharing supply-chain management and infrastructure. PepsiCo CEO Indra Nooyi has publicly expressed commitments to further increase the level of presence of the company in emerging markets. and “stuff” that clarifies and reinforces what a company truly values”[4] and the nature of organizational culture directly impacts its performance in short-term and long-term perspectives. Importantly. cross-cultural differences in various markets are taken into account . and ‘embracing own individuality’. focusing on organizational culture. PepsiCo CEO Indra Nooyi is widely believed to be an unconventional corporate leader for a good reason. It has been noted that “she’s been known to walk the halls at Pepsi barefoot. PepsiCo has been able to claim its share from increasing energy drink market segment. Indra Nooyi has been striving to increase the level of association of individual brands with PepsiCo company values and philosophy through promoting the idea of One PepsiCo. and using celebrity endorsement in an innovative manner by attracting a popular singer amongst Pepsi brand target customer segment Beyonce Knowles. Sixth. Building new capabilities 3. Moreover. 5Cs stand for the following: 1. For example.when developing and delivering PepsiCo marketing messages. Commercial agenda 2. Exercise discipline when it comes to capital returns . the senior management focuses on the framework known as ‘5Cs’ to guide PepsiCo business strategy and long-term planning. Fostering a culture of collaboration 5. Increasing focus on costs 4. the marketing tagline of “Live for Now” associated with Pepsi brand has been modified as “Yalla Now” and “Oh Yes Abhi” for Middle East and Indian markets respectively taking into account cross-cultural differences associated with these markets. diet Pepsi. 2004). 2003). a soft drink. which are based on: * Product * Price * Place * Promotion Finally.INTRODUCTION Pepsi-Cola Pepsi's beverage business was founded by a pharmacist named Caleb Bradham who created a special beverage. we will specifically focus on Pepsi-Cola. four elements or components will be analysed in this report. such as Pepsi-Cola. Pepsi also has a variety of products in the world. is a Multinational corporation. In order to make the information of this report accurate and forceful. Pepsi max. mountain dew and so forth. Firstly. Secondly.. in the back room of his drug store in New Bern. and like what coke has. In this report. Those sources including: * Marketing textbook * Academic paper * Internet * Online business magazines BACKGROUND Pepsi Co. which extends over many . the background of Pepsi Company and their products will be summarized. some recommendations relative to Pepsi’s marketing strategy will be suggested. several valuable sources were used to analyse. It has become one of today’s leading soft drink with nearly $20 billion in worldwide retail sales (PepsiCo Inc. North Carolina (Pepsi Co. and the aim of this report is to summarize and analyse Pepsi’s growth strategy as well as its marketing strategies. where its biggest competitor is Coca-Cola. Pepsi is target against African Americans and it is not until later that Pepsi started to target the younger population for all races. its advertising campaign include TV. as Pepsi is not as expensive as Coke and not as cheap as the other brands. can be identified easily as it is been on various finest soft drinks available almost all over the world for over 100 years. Pepsi’s target market has usually been the middle-income family. For example in Singapore there is a promotion done by Pepsi that for every 6-pack of Pepsi you purchase you can have a turn on the fortune wheel to win prizes such as Pepsi t-shirt. The Pepsi-Cola website . Pepsi-Cola has been around for more than a hundred years. which named the new company Pepsi Co. more Pepsi drinks and cash prizes. Within the soft drink industry Pepsi is considered to be a middle class drink and Pepsi offers quality product that provides assurance to the public. Pepsi brand name and its strategic message ‘it’s the cola’ have already penetrated the world market. however this is still based on location and in China the target market are usually people from early teen to their late thirties. outdoors and on the Internet. has merged with some other companies such as Gatorade. magazines. The marketing campaigns it undertook include lucky draw and promotions. Pepsi is undertaking both advertising and marketing campaigns around the world. In this case the brand name ‘Pepsi’ is very effective in differentiating its product from the others. Pepsi and Frito-Lay merged in 1960. Besides. This is done when the economy is in recession and Pepsi is trying to boost up its company and product image. Pepsi around the world usually target toward young people early teens to late twenties.countries. PRODUCT Pepsi. The company operates in a monopolistically competitive market. Pepsi Co. The Pepsi logo has become a remarkable feature in United Stated of America indicating an ‘ice blue background’ synonymous with Pepsi products. which became the world’s fifth-largest food and beverage company with 15 brands. one of the most famous brands. in-stores. It is first produced in 1898 and in the earlier times. Moreover.com.com. For classic Pepsi cola. 2004. Pepsi World shows how Pepsi is made to introduce the quality and features of classical cola (pepsi. which is the widely sold Pepsi soft drink. 2004. Keiley mentioned that Pepsi-Cola sales are up in America compared with the Coke-cola. for the target customers. recyclable. It can be proved that both the high quality and famous global brand make Pepsi-cola so successful to compete with Coke-cola. internet. 2004). Targeting a suitable marketing is essential for the success and Pepsi-Cola sets lower prices as the key at high quality. Currently. plastic bottles. 2004). price sensitive segment becomes one of the most important factors for target marketing.com. quality taste and consumer satisfactions are the highest priorities (pepsi. the website indicates that each ingredient of producing Pepsi-Cola must pass high standard. p110) identified the meaning of products is the branded ‘goods and service’ offers to the target market. p111) identified the product elements that attract them as shown below: · Variety · Quality · Features · Brand name · Packaging · Sizes · Add-ons · Warranties · Returns Using the above methodology. which was particularly disappointing because the careful balance of pricing and marketing (Kiley. Kotler (Kotler. Kotler (Kolter. Pepsi-Cola can be a warranty as its famous brand. In order to meet customers’ needs and make them easy-to-use. . rigorous quality control tests and strict bottling procedures all over the world. 2004). Coke leaves a bad taste on the street. Now. the packagings of Pepsi-cola had tried many different industries but it always follows Environmental Support and Recycling of USA. At the same time. it is reported that the ‘cube’ as a new innovative 24-can Pepsi multipack is used by a small test market population to give the company feedback before the introduction (pepsi. It is known that consumers prefer lightweight. 9/15/2004).points out that at Pepsi-Cola. it can raise the sales of classical coke and attracts loyal consumers in a young age. It is not easy for consumer to recognize and be interested in it. However. the bottles for children could be smaller than the usual size for them to carry to school. So bottles in the soft drink industry are a very important part of the whole processes. the design of bottles is very similar as other brands of cola. It does propose is to shift its franchisee operations from Coca-Cola to Pepsi. In this way. The appearance of bottles can improve (to be) more fashionable or lovely to attract younger consumers and make loyal customers enjoy new style of Pepsi classical cola. they must have a container to carry. the bottle of Pepsi classical cola can be with the shape of Nemo or Winney the Pooh. the symbol of brand is quite clear and obvious. there are always few drink packages designed for particular groups of people. The soft drink industry sold their drink to customers. Smaller bottles are easy for consumers to carry and larger ones with lower price are suitable for families. The children can also collect different kinds of cartoon bottles for fun. but also stimulating customers to get more. For the package. It is really a good idea to set add-ons because it is not only advertising the new product among the consumers. such as the kids. One of the ways they have been able to assist this effort is by expanding their use of inexpensive and recyclable plastic bottles. It is believed that it is better to design a package with some popular cartoon stars for children to choose. Moreover. (Pepsi World. Moreover. For examples. 2004) Another ways is to reduce the cost of the bottles.There are also many sizes of bottle to satisfy different kinds of consumers. Kids are quite important consumers in the market. in the market. . consumers get chances to take add-ons back home. For example. PepsiCo takes over the bottling operations from its franchisee. When buying Pepsi-Cola. The company manufactures and sells soft drink relies on Pepsi bottlers. in some parts of the country a two-litre bottle of Pepsi cost 99 cents a decade ago and still does today. PRICE Providing quality products at the lowest possible price has always been one of the main concerns of Pepsi. Sometimes Pepsi use cutthroat competition to war with its main competitor – Coca-cola. What is more. In the home-consumption segment too.5-litre and 2-litre PET bottles. Pepsi expenditures for labour. Coca-Cola is still having an upper hand with 56 per cent market share. without increasing the price. to 1.2 and $1. against the earlier price of $1. Coca-Cola had to struggle hard to counter Pepsi's aggressive marketing strategies. triggered by Pepsi. According to industry sources. Pepsi had to slash prices of its 300 ml returnable glass bottles to $0. but also reduce its own risk on the bottles inflation and has a steady supply of bottle. The Pepsi management thinks in a high-consumption market.6 and this price cut to make its brands more affordable in April 2003. they had to offer a lot of incentives. and 200 ml at $0. 200-ml bottles are priced at $0. As a consequence. The cost of aluminium alone has increased dramatically since last year. (Sandesh. Across their entire system. transportation and more rise continuously. however. The soft drink industry today is confronted with a bewildering array of price increases.5-litre and 2-litre PET bottles. It is their policy to limit any price increases to the retail trade to the lowest possible extent. One of the price war. So that Pepsi sometimes takes non-profitable turns with . like Pepsi. The new price points are 300 ml at $0. Reducing and maintaining the cost is not the only marketing strategic used by Pepsi.5. They were getting bottles from neighbouring states incurring heavy expenditure on transportation and storage. Just before the Union Budget for 2003-04. 2000) This takes over the bottling operations not just make Pepsi’s competitors to shift up their manufacturing cost on purchase the bottling.5 and 2.0 respectively.6.5. follows an earlier onslaught when both the companies reduced prices by about 20 per cent across the board. have been cutting overhead and re-engineering our manufacturing process in order to keep our prices competitive.which had forced Coca-Cola to import its bottles from outside till recently— Pepsi managed to increase its share to almost 44 per cent from a mere 30 per cent three years ago. Coca-Cola took the lead earlier in 2003 by slashing prices of its 1. aggressive price points devolving from the 300-ml segment will work much better. But with the bottling operations shifting over to Pepsi in November 1997 -.6. this sector is heavily dependent on returnable glass bottles and Pepsi's latest price reduction strategy is critical to drive volumes. ingredients.As the bottlers shifted to Pepsi. Pepsi yet to follow suit too reduced prices of its 1. The consequence not just affects the Pepsi Co.. Pepsi-cola may try to establish better relationships with other fast food businesses such as . the PepsiCo also sell Pepsi-cola through the cooperation with other partners (PepsiCo Inc. Also it affects the normal price market. The Pepsi website states that in 1992. Normally. resulted in great sales. The incentive for the PepsiCo is to extend their brand reputation in the whole world through those businesses. a partnership agreement was formed by Pepsi-cola with Thomas J. In contrast. As the good reputation and image was created. According to the statistics from the Australia Pepsi website. owner of the number one tea trademark in the US. currently there are “more than 400 Pepsi-cola bottlers in the US and more than 600 internationally. Pepsi-cola brand is already been brought into the mind of the consumers as an invisible image. consumers can purchase Pepsi-cola from supermarkets.. The Pepsi Company manufactures and sells their products to the company they owned. Lipton Co. which have partnership with Pepsi. The customers will change their taste to Coca-Cola more elastically. price shift back to the normal price. 2004). and the independent bottlers that are franchised operating facilities through out the United States and Canada. restaurant. It will affect as the customer adapt and get use to the cheaper price. Other partners such as Pizza Hut. 2004). They receive support from PepsiCo and sell the product. Its beverage business contains North America and international. net profit. The Pepsi-cola product is sold approximately about 195 countries and Territories” (PepsiCo Inc. KFC and Hard Rock CAFÉ have partner relationship with Pepsi -cola. KFC and Pizza Hut. After the price war. 2003) However this cutthroat competition should not too often war with its main competitor. Pepsi-cola almost exist anywhere and can be easily purchased by customers.the sole aim of retaining market shares. Pepsi-cola still need improvement for their market strategy in order to have an increase in their product sales. (PTI.. PLACE Pepsi-cola as a famous brand is welcomed almost everywhere in the world and is well supported by millions of people. Meanwhile. and a distribution agreement was also entered with Ocean Spray. localization of Pepsi-cola in the limited area would limit the product sales volume and lower its profit. For instance. 2004). the number one non-refrigerated juice trademark in supermarkets (PepsiCo Inc. 2004). personal selling and sales promotion to continuously reinforce consumers’ attitudes and perception of the product. baseball and car racing (PepsiCo. It uses advertising. 2004). These strategies also put into the features of new radio. PROMOTION Pepsi-cola has an extensive integrated marketing communication by coordinating promotional efforts. contemporary and exciting. Pepsi declares its . Due to the same reputation as KFC. Pepsi-cola attracts consumers’ attention by the new campaign “Pepsi. the permission of sale for Pepsi-cola in the MacDonald would be helpful to raise its reputation and profit. A sponsorship deal was signed with Magna Entertainment Corp. 1997). in September as an extension of this strategy (The Blood-Horse Inc. football. (PepsiCo Inc. 2004). and adding a new ‘hero” image to the product. 2004) Another advertising tool frequently used by Pepsi-cola is sponsorship. This commercial released during the Super Bowl XXXVIII as an in-game advertisement. it spreads the food-friendly message strategy by identifying customers’ benefit— consumes Pepsi with popular American food like hot dogs and tacos is an enjoyment. prints and on line adverting. It is the cola”. the automatic vending machines are placed all over the country. the more reputation and revenue the company would have. spontaneous. Besides. For public relations.MacDonald. Inc. targeting the self-selecting target market. It sponsors various sports teams and events including soccer. movie stars and famous singers are used as a representative of the product to attract consumers’ attention and affect the liking of the product. In advertising strategies. The campaign persuades and reminds consumers the product brand images— spirited. The more places the Pepsi-cola can be sold.. public relations. In the new released television commercial. fun and satisfaction. Pepsi-cola makes an effort on building a responsible image on both environment and the well-being of consumers (Wong & Takamune. In the annual report 2003. Inc. Different sports stars. associating with the food-friendly strategy (PepsiCo. Pepsi-cola also used outdoor advertising in billboards and at bus stops all over America. Pepsi -cola could possibly sign the contract with MacDonald competing with their competitor. The Pepsi. The Pepsi Bottling Group has about 6000 salespeople and recently invested in a Pocket PCs with customized software “Shelflink” to its sales force. Inc. Ink’s online marketing plan. 2004).com has constantly updated news and information on the product. Pepsi-cola contests and games promotions are one of the major tools it uses to achieve sales promotion objectives—rewarding loyal customers and lure customers away from its competitor Coca-cola. (PepsiCo. Latest sales promotion featuring a collectable Pepsi die-cast car in a commemorative vending tin on the internet and a million give away in a television show (PepsiCo. develops education programs and follows environmental legislations. Other public relation strategies like posing newsworthy information on the company website have also been used. It helps the salespeople to reduce time spending on various calculations and getting all sales information immediately. 2003) Pepsi-cola’s promotion is highly supported by PepsiCo. 2004) The overall performance of Pepsi-cola’s promotion strategies is satisfactory.. Pepsi-cola existing advertising strategies can achieve the attention of the public effectively and achieve its advertising objectives—to persuade buyers to purchase the product and switch to .com coordinates with the Pepsi-cola advertising strategies by combining attractive graphics with the marketing message. 1993). Inc. The report also declares its concern on responsibility to contribute to the well-being of consumers. The PepsiCo. Inc. 2004). Other sales promotion like in-store displays to attract consumers’ attention during shopping increases sales. Advertising is “the action of calling something to the attention of the public. support communities with direct contribution to not-for-profit groups and working with organizations delicate to improving the life of people (PepsiCo. seeking methods that are socially responsible. like efficient usage of water. It generates sales and increases demand of the product effectively.action on environmental improvement. especially by paid announcements” (Webster. This new technology allows Pepsi-cola sales force achieve the sales objectives quicker by increasing time efficiency (Microsoft Corp. such as using 10% recycled materials in plastic bottles. It provides easy to access product information and latest promotion programs to customers. Sales promotion can push up sales in short term and building up consumers’ long term commitment. and remind consumers the brand image in order to maintain top-of-mind product awareness. major media types have been use to reach and expose to the target market effectively. It is the cola” communicates well to consumers the new hero image added to the product. Ink website is also a good tool of building a positive product image. It is unquestionable that sufficient spending has been made in these areas. Pepsi-cola should increase its usage of public relations to impact the public awareness of the product. Press releases of Pepsi-cola in the Pepsi Co. Increasing usage of other sales promotion tools is also recommended as alternatives. Inc. Pepsi-cola is able to create large incentive to consumers. Using games and contests to push up sales is one of the most effective ways of increasing consumers’ product awareness. but it needs to consider the cost effectiveness of these promotions carefully. Since creative message has a large effect on consumers’ memory. As both are the new trends that increasingly concerned by the public. 2004). however the campaign’s creative message cannot relates to the food-friendly strategy. Building good relationship with various publics by building up a good product image is important for a brand. Like the new in-game commercials during famous sport event Super Bowl XXXVIII can effectively tailor to suit large amount of sport loving consumers. with more credibility and a much lower cost than advertising. such as patronage rewards and redeemable coupons in order to attract various consumers by different . Besides. the automatic vending machines tailor to suit the self-selecting targets. Pepsi-cola attempted to create a healthy image—including declares to take responsibilities on consumers’ health and the environment. On the other hand. The new message strategy “Pepsi. This message combines with related graphics to attract attentions. this strategy is able to bring positive image to the product. Pepsi-cola is recommended to increase its effectiveness of creative messages exclusively. and it has been successfully generates to increase sales and improve brand image (PepsiCo. 2004). Another message of the new advertising campaign is “Pepsi-cola is food-friendly”. Sponsorship is one of the most important advertising tools used by Pepsi-cola.the brand. such as making public speeches and presentations (PRSA. Sponsoring sport events and teams can be very effective on spreading its brand images. Pepsi has built a good reputation around the world. this report has built a clear sense through four important elements---product. CONCLUTION In brief. Beside all the traditional marketing tools.types of incentives. 2004). Pepsi-cola’s promotion strategies helps to gain a large market during the last decade. there is some space of improvement for Pepsi-cola. On the whole. some usual definitions relative to the analysis have been broadened out. Overall. the websites are able to target another group of consumers in the market. online marketing is the latest and fastest growing trend in the global market. Pepsi has developed the Pepsi. with access of all sales information in hand all the time. place and promotion. public relations strategies and sales promotion strategies of Pepsi-cola. was also conducted. Notes that market research would be able to help the marketers to gain more understanding of its target market. The new technology improves the performances of the sales force. Pepsi-cola has well-developed promotion plan and strategies in all dimensions. an impeccable image and an assurance of quality . Nevertheless. The fashionable graphics and a user-friendly menu are able to attract many web servers’ attention. On the other hand. These websites is designed to coordinate with all of the advertising campaigns and strategies. Constant retraining should be provided to the salespeople in order to improve their performances and keep up with the latest market trends. price.com and PepsiCo. Moreover. This helps the salespeople to understand the needs of the retailers and be able to build a good connection with them. Facing its greatest competitor Coca-cola—the market leader of soda. since the effectiveness of promotion strategies is greatly affected by the economy. In the analysis of Pepsi’s marketing strategy.com—two major website related to Pepsi-cola. Pepsi-cola salespeople should be able to make good relationships and communicating well with retailers. a detailed view at Pepsi Co. it is recommended to increase the budget spending in this area. marketers should also study the changing economic condition and trends. (PepsiCo. Moreover. Inc. Furthermore. This is a proof to its success on promotion strategies. Pepsi is a company in the soft drink market with a strong history. Some recommendations for Pepsi are as follows: · Pepsi should increase its price to show it has high quality product. RECOMMENDATION On the whole. These fast food restaurants are usually seen as lower to middle class restaurants and it could affect the brand name in the minds of consumers. rigorous quality control tests and strict bottling procedures all over the world. Although Pepsi is the fifth largest food and beverage company. there are a few improvement can be made by Pepsi-Cola. and the take way owner. directly as this could reduce the cost of both Pepsi Co. its product Pepsi-Cola is still quite cheap comparing with Coca-Cola— the leading soft drink provider.e. · Pepsi should sign contract with some small takeaways to buy Pepsi form Pepsi Co. . Pizza Hut and Taco Bell. Pepsi currently have contract with some fast food outlets to sell Pepsi products only. · Pepsi should make contract with smaller restaurant as well instead of just fast food outlets. it still doesn’t change consumer’s perspective of Pepsi. However there are some small restaurants selling Pepsi when customer asks for it. it could alter the consumer’s perspective on Pepsi (i. If an advertisement that show Pepsi only allow excellent quality product to be sold to the consumers.in all aspects that explains its current success and will lead to its undeniable success in the future. If a contract was written with smaller restaurant. · Advertise that all Pepsi products must pass high standard. KFC. Most people can link price with quality and the low-price may actually indicates poor quality and it could cause Pepsi to lose the business in the long run. such as a restaurant beverage must include all Pepsi products and not any of Pepsi competitor’s products could improve Pepsi’s image as a beverage provider for middle class families. for examples. Pepsi offer excellent quality product only). However there are draw back for all of the recommendations. which means a small price change could lead to a large change in quantity demanded (Kotler. especially in a large economy that is in recession such as America. however excess advertising of this could be a major expenditure for Pepsi with limited effects. the higher price of Pepsi product could lead people to buy more coke as the soft beverage market is a highly elastic market. The advertisement showing Pepsi products pass high quality control could have some effect on consumer’s perspective of the product Pepsi.491). . 2004 p.
Report "PepsiCo Business Strategy and Competitive Advantage Om Ex"