PROJECT REPORT ON
MARKETING AND SALES PROMOTION OF PEPSI
Submitted in partial fulfillment of the requiremnets for the award of the degree of BACHELOR OF BUSINESS ADMINISTRATION
Submitted To: MOHD. IBRAHIM
Submitted By: MUKESH KUMAR ARYA Enrollment No.: 62323012
DIRECTORATE OF DISTANCE EDUCATION PUNJAB TECHNICAL UNIVERSITY JALANDHAR
CERTIFICATE The project entitled “Marketing And Sales Promotion of Pepsi” is hereby approved as a bonafide work carried out and presented by Mukesh Kumar Arya in a manner satisfactory to warrant it acceptance to the degree after which it has been submitted. It is understood that by this the undersigned do endorse or approve any statement made, opinion expressed or conclusion drawn therein, but approve the project work only for which it has been submitted.
Signature of the Teacher
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ACKNOWLEDGEMENT I express my sincere regards and thanks to all my respected teachers who directly or indirectly helped in successfully developing / executing the project in question. It won’t be out of place to mention that the process of making the project has been both educative as well as truly joyful experience. Hereby only I thank to my parents, without their unquestioning blessings and supports I would not have been here today writing these words.
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PREFACE Summer project is necessary part for fulfillment of BBA course. The emphasis in the project is providing the study and an insight into Indian FMCG Business Scenario. The summer training project is designed to provide participation of BBA program as on the job experience. This has given a chance to try and apply the academic knowledge and gain insight into corporate culture. This helps in developing decision-making abilities and emphasizes on active participation by the student. I undertook my project in PEPSICO INDIA HOLDINGS Pvt. Ltd Delhi a leading Bottler and Marketing partner of the Pepsi Foods. During the training, I had worked on the project “Marketing Strategies & Sales Promotion in Pepsi” I gained valuable experience & knowledge during the survey. The Project consists of my findings after tabulation of collected data, then analyzed conclusions were drawn and finally suggestions were put forward.
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CONTENTS 1.
Preface
2.
Executive summary
3.
Company profile & history
4.
Products profile
5.
Credentials
6.
Objectives
7.
Research methodology
8.
Findings & observations
9.
Analysais
10.
Recommandations
11.
Limitations
12.
Key areas
13.
Conclusions
14.
Questionnaire
15.
Bibliography
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EXECUTIVE SUMMARY The distribution network of PEPSI is well known for its efficiency but company constantly strives for the betterment of their distribution network system. Emphasis of our study was to focus on the customer of company i.e., the retailers. The Retail Mapping of Delhi is an integral step for the assessment, development and betterment of this system. The distribution system not only comprises the movement of the products but also incorporates the merchandising of the product, which is very broad in its purview. The project incorporates the analysis of the performance of PEPSI and probing into opportunities of increasing the market share in Delhi. The entire process had to be in an organized manner in order to deliver meaningful results for the purpose of decision-making. The project was that of market research with surveys and observations as its major phases with the objective of gathering of all important information material for strengthening the position of PEPSI in Delhi. PEPSI boasts of having the maximum market share in the beverage segment in Delhi. and is in constant process for the betterment of its product performance and customer as well retailer’s satisfaction.
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THE COMPANY PROFILE: PEPSI CO. Caleb Bradham a New Bern N.C druggist who formulated Pepsi Cola founded Pepsi Cola Beverage business at turn of the century. Pepsi Cola Company now produces and markets nearly 200 refreshment beverages to retail, restaurants and food service customers in more then 190 countries and territories around the world and generates revenue of over 18 billion dollars PepsiCo World Headquarters is located in Purchase, New York. Pepsi Co. is the world leader in the food chain business. It consists of many companies amongst which the prominent ones are Pepsi Cola, Frito-lay, Pepsi food international, Pizza-hut, KFC and Taco bell. The group is presently into three most profitable businesses namely, Beverages Snacks foods and Restaurants. The beverages segment primarily market it Pepsi diet, Pepsi Mountain Dew and other brands worldwide and 7UP outside the U.S.market. They are positioned in close competition with Coca Cola inc. of USA. The Snacks food divisions manufacture and distribute and markets others snacks worldwide. The restaurant segment primarily consists of the operations of the worldwide PizzaHut, Taco bell and KFC chains PFS, PepsiCo’s restaurant distribution operation, supplies to Company owned and Franchise restaurants in the U.S. When Coca Cola changed its formula in 1985, Pepsi Stepped up its competition with its long time archrival claiming victory in the Cola-wars. Coke and Pepsi expended their rivalry to tea in 1991 when Pepsi formed a venture with No.1 Lipton in response to Coke’s announced venture with Nestle (Nestea).
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Although Pepsi holdings over the years have become diverse in such fields as the Snacks industry and Restaurants industry, this portfolio will discuss its core business and its highly successful business of Beverages. The soft drink industry customer base is probably the widest and deepest base in a world that is flooded with some many categories. According to Beverage Digest the customer base for soft drinks is a whopping 95% of regular users in the United States. This represents a large field of potential customers for Pepsi Cola. Pepsi prefers to segment itself as the beverage choice of the “New Generation”, “Generation Next”, or just as the “Pepsi Generation”. These terms adopted in Pepsi’s advertising campaigns are referring to the markets that marketers refer to as Generation X. The Generation X consumer is profiled to be between the ages of 18 to 29. They have high expectations in life and are very mobile and active. They adopt a lifestyle of living for today and not worrying about long-term goals. Those Pepsi’s main emphasis on this segment they also have a focus on the 12 to 18 year old market. Pepsi believes if they can get this market to adopt their product then they could establish a loyal customer for life. Pepsi Cola throughout its 100 years of existence has developed much strength. One of the strengths that has developed Pepsi into such a large corporation is a strong franchise system. The strong franchise system was the backbone of success along with a great entrepreneur spirit. Pepsi’s franchise system and distributors is credited to bring Pepsi from a 7,968 gallons of soda sold in 1903 to nearly 5 billion gallons in the year of 1997. Pepsi also has the luxury to spend 225 million dollars in advertising a year. This enormous ad budget allows Pepsi to reinforce their products with reminder
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advertising and promotions. This large budget also allows Pepsi to introduce new products and very quickly make the consumer become aware of their new products. Pepsi also has had the good fortune of making very wise investments. Some of the best investments have been in their acquiring several large fast food restaurants. They have also made wise investments in snack food companies like Frito Lay, which at present time is the largest snack company in the world. Probably high on the list of strengths is Pepsi’s beverage line up. Pepsi has four soft drinks in the top ten beverages in the world. These brands are Pepsi, Mountain Dew, Diet Pepsi, and Caffeine Free Diet Pepsi. Some other strong brands are All Sport, Slice, Tropicana, Starbucks, Aquafina and a license agreement with Ocean Spray Juices.
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THE HISTORY OF PEPSI-COLA Pepsi was first made in New Bern, North Carolina in the United States in the early 1890s by pharmacist Caleb Bradham. In 1898, "Brad's drink" was changed to "PepsiCola" and later trademarked on June 16, 1903. There are several theories on the origin of the word "pepsi". The only two discussed within the current PepsiCo website are the following: Caleb Bradham bought the name "Pep Kola" from a local competitor and changed it to Pepsi-Cola. "Pepsi-Cola" is an anagram for "Episcopal" - a large church across the street from Bradham's drugstore. There is a plaque at the site of the original drugstore documenting this, though PepsiCo has denied this theory. The word Pepsi comes from the Greek word "pepsi" (πέψη), which is a medical term, describing the food dissolving process within one's stomach. It is also a medical term, that describes a problem with one's stomach to dissolve foods properly. Another theory is that Caleb Bradham and his customers simply thought the name sounded good or the fact that the drink had some kind of "pep" in it because it was a carbonated drink, they gave it the name "Pepsi". It was made of carbonated water, sugar, vanilla, rare oils, and kola nuts. Whether the original recipe included the enzyme pepsin is disputed. In 1903, Bradham moved the bottling of Pepsi-Cola from his drugstore into a rented warehouse. That year, Bradham sold 7,968 gallons of syrup. The next year, Pepsi was sold in six-ounce bottles and sales increased to 19,848 gallons. In 1924, Pepsi
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received its first logo redesign since the original design of 1905. In 1926, the logo was changed again. In 1929, automobile race pioneer Barney Oldfield endorsed PepsiCola in newspaper ads as "A bully drink...refreshing, invigorating, a fine bracer before a race". In 1929, the Pepsi-Cola Company went bankrupt during the Great Depression- in large part due financial losses incurred by speculating on wildly fluctuating sugar prices as a result of World War I. Assets were sold and Roy C. Megargel bought the Pepsi trademark. Eight years later, the company went bankrupt again. Pepsi's assets were then purchased by Charles Guth, the President of Loft Inc. Loft was a candy manufacturer with retail stores that contained soda fountains. He sought to replace Coca-Cola at his stores' fountains after Coke refused to give him a discount on syrup. Guth then had Loft's chemists reformulate the Pepsi-Cola syrup formula. Rise in popularity During the Great Depression, Pepsi gained popularity following the introduction in 1929 of a 10-ounce bottle. Initially priced at 10 cents, sales were slow, but when the price was slashed to five cents, sales increased substantially. With a radio advertising campaign featuring the jingle "Pepsi cola hits the spot / Twelve full ounces, that's a lot / Twice as much for a nickel, too / Pepsi-Cola is the drink for you," Pepsi encouraged price-watching consumers to switch, obliquely referring to the Coca-Cola standard of six ounces a bottle for the price of five cents (a nickel), instead of the 12 ounces Pepsi sold at the same price. Coming at a time of economic crisis, the campaign succeeded in boosting Pepsi's status. In 1936 alone 500,000,000 bottles of Pepsi were consumed. From 1936 to 1938, Pepsi-Cola's profits doubled.
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Pepsi's success under Guth came while the Loft Candy business was faltering. Since he had initially used Loft's finances and facilities to establish the new Pepsi success, the near-bankrupt Loft Company sued Guth for possession of the Pepsi-Cola company. A long legal battle, Guth v. Loft, then ensued, with the case reaching the Delaware Supreme Court and ultimately ending in a loss for Guth. Loft now owned Pepsi, and the two companies did a merger, then immediately spun off the Loft company. Niche marketing 1940s advertisement specifically targeting African Americans. Walter Mack was named the new President of Pepsi-Cola and guided the company through the 1940s. Mack, who supported progressive causes, noticed that the company's strategy of using advertising for a general audience either ignored African Americans or used ethnic stereotypes in portraying blacks. He realized African Americans were an untapped niche market and that Pepsi stood to gain market share by targeting its advertising directly towards them. To this end, he hired Hennan Smith, an advertising executive "from the Negro newspaper field" to lead an all-black sales team, which had to be cut due to the onset of World War II. In 1947, Mack resumed his efforts, hiring Edward F. Boyd to lead a twelve-man team. They came up with advertising portraying black Americans in a positive light, such as one with a smiling mother holding a six pack of Pepsi while her son (a young Ron Brown, who grew up to be Secretary of Commerce) reaches up for one. Another ad campaign, titled "Leaders in Their Fields", profiled twenty prominent African Americans such as Nobel Peace Prize winner Ralph Bunche and photographer Gordon Parks.
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Boyd also led a sales team composed entirely of African Americans around the country to promote Pepsi. Racial segregation and Jim Crow laws were still in place throughout much of the U.S., so Boyd's team faced a great deal of discrimination as a result, from insults by Pepsi co-workers to threats by Ku Klux Klan. On the other hand, they were able to use racism as a selling point, attacking Coke's reluctance to hire blacks and support by the chairman of Coke to segregationist Governor of Georgia Herman Talmadge. As a result, Pepsi's market share as compared to Coke's shot up dramatically. After the sales team visited Chicago, Pepsi's share in the city overtook that of Coke for the first time. This focus on the African American market caused some consternation within the company and among its affiliates. They did not want to seem focused on black customers for fear white customers would be pushed away. In a meeting at the Waldorf-Astoria Hotel, Mack tried to assuage the 500 bottlers in attendance by pandering to them, saying, "We don't want it to become known as the nigger drink." After Mack left the company in 1950, support for the black sales team faded and it was cut. Marketing A large advertisement made to resemble a Pepsi cup at the theme park, Nickelodeon Universe inside the Mall of America. The first of many new designs of Pepsi cans which were released in 2007. In 1975, Pepsi introduced the Pepsi Challenge marketing campaign where PepsiCo set up a blind tasting between Pepsi-Cola and rival Coca-Cola. During these blind taste tests the majority of participants picked Pepsi as the better tasting of the two soft
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drinks. PepsiCo took great advantage of the campaign with television commercials reporting the test results to the public. In 1996, PepsiCo launched the highly successful Pepsi Stuff marketing strategy. By 2002, the strategy was cited by Promo Magazine as one of 16 "Ageless Wonders" that "helped redefine promotion marketing." In 2007, PepsiCo redesigned their cans for the fourteenth time, and for the first time, included more than thirty different backgrounds on each can, introducing a new background every three weeks. Celebrity endorsers Like Coca-Cola, Pepsi and its associated beverages have had various celebrity endorsers and continue to use them. Slogans :1939: "Twice as Much for a Nickel" 1950: "More Bounce to the Ounce" 1950: "Any Weather is Pepsi Weather" 1957: "The Light Refreshment" 1958: "Be Sociable, Have a Pepsi" 1961: "Now It's Pepsi for Those Who Think Young" 1963: "Come Alive, You're in the Pepsi Generation". 1967: "(Taste that beats the others cold) Pepsi Pours It On".
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1969: "You've Got a Lot to Live, and Pepsi's Got a Lot to Give" 1975: "Have a Pepsi Day" 1977: "Join the Pepsi People (Feeling Free)" 1980: "Catch That Pepsi Spirit" David Lucas composer 1981: "Pepsi's got your taste for life" 1983: "Pepsi Now! Take the Challenge!" 1984: "The Choice of a New Generation" 1986: "We've Got The Taste" (Commercial with Tina Turner) 1990: "You got the right one Baby UH HUH" 1991: "Gotta Have It"/"Chill Out" 1992: "Be Young, Have Fun, Drink Pepsi" 1995: "Nothing Else is a Pepsi" 1996: "Pepsi:There's nothing official about it" (During the Wills World Cup(Cricket) held in India/Pakistan/Srilanka) 1997: "GeneratioNext"." With The Spice Girls " 1998: "Yeh Dil Mange More"(In Hindi meaning "My heart wants more") 1999: "Ask for More"/"The Joy of Pepsi-Cola" (Commercial with Britney Spears/Commercial with Mary J. Blige) 2003: "It's the Cola"/"Dare for More"
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2005: "Wild Thing"/"Ask For More" (With Jennifer Lopez ) 2006: "Why You Doggin' Me"/"Taste the one that's forever young" Commercial featuring Mary J. Blige 2007: "More Happy"/"Taste the one that's forever young" (Michael Alexander) Pepsiman Pepsiman is an official Pepsi mascot from Pepsi's Japanese corporate branch. The design of the Pepsiman character is attributed to Canadian comic book artist Travis Charest, created sometime around the mid 1990s. Pepsiman took on three different outfits, each one representing the current style of the Pepsi can in distribution. Twelve commercials were created featuring the Pepsiman. His role in the advertisements is to appear with Pepsi to thirsty people or people craving soda. Pepsiman happens to appear at just the right time with the product. After delivering the beverage, sometimes Pepsiman would encounter a difficult and action oriented situation which would result in injury. Pepsiman was featured as a Japanese Exclusive Transformers toy "Pepsi Convoy," which was based on G1 Optimus Prime. In 1996, Sega-AM2 released the Sega Saturn version of their arcade fighting game Fighting Vipers. In this game Pepsiman was included as a special character, with his specialty listed as being the ability to "quench one's thirst". He does not appear in any other version or sequel. In 1999, KID developed a video game for the PlayStation entitled Pepsiman. As Pepsiman, the player runs, skateboards, rolls, and stumbles through various areas, avoiding dangers and collecting cans of Pepsi all while trying to reach a thirsty person as in the commercials.
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Bans in India Pepsi was banned from import in India in 1970 for having refused to release the list of its ingredients.In 1988, the ban was lifted, with Pepsi arriving on the market shortly afterwards. In 2003 and again in 2006, the Centre for Science and Environment (CSE), a non-governmental organization in New Delhi, claimed that soda drinks produced by manufacturers in India, including both Pepsi and Coca-Cola, had dangerously high levels of pesticides in their drinks. Both PepsiCo and The CocaCola Company maintain that their drinks are safe for consumption and have published newspaper advertisements that say pesticide levels in their products are less than those in other foods such as tea, fruit and dairy products. In the Indian state of Kerala, sale and production of Pepsi-Cola, along with other soft drinks, were banned in 2006 following partial bans on the drinks in schools, colleges and hospitals in five other Indian states. On September 22, 2006, the High Court in Kerala overturned the Kerala ban ruling that only the federal government can ban food products. Health concerns Pepsi and similar products contain large amounts of sugar. Excessive sugar intake is thought to be a contributing factor in the development of certain types of diabetes. Sugar is also a leading contributor to tooth decay. Rivalry with Coca-Cola According to Consumer Reports, in the 1970s, the rivalry continued to heat up the market. Pepsi conducted blind taste tests in stores, in what was called the "Pepsi Challenge". These tests suggested that more consumers preferred the taste of Pepsi (which is believed to have more lemon oil, less orange oil, and uses vanillin rather
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than vanilla) to Coke. The sales of Pepsi started to climb, and Pepsi kicked off the "Challenge" across the nation. In 1985, The Coca-Cola Company, amid much publicity, changed its formula. Some authorities believe that New Coke, as the reformulated drink came to be known, was invented specifically in response to the Pepsi Challenge. However, a consumer backlash led to Coca-Cola quickly introducing a modified version of the original formula (removing the expensive Haitian lime oil and changing the sweetener to corn syrup) as Coke "Classic". Comedian Dave Chappelle starred in ads for both Coca-Cola and Pepsi, an act which drew controversy. When referring to it in his show, Chappelle said, "I can't even taste the difference: all I know is Pepsi's paying more right now, so it tastes better." In the U.S., Pepsi's total market share was about 31.7 percent in 2004, while Coke's was about 43.1 percent. Overall, Coca-Cola continues to outsell Pepsi in almost all areas of the world. Saudi Arabia, Pakistan (Pepsi has been a dominant sponsor of the Pakistan cricket team since the 1990s), the Canadian provinces of Quebec and Prince Edward Island and the U.S. states of Michigan and South Carolina are the exceptions. Pepsi had long been the drink of Canadian Francophones and it continues to hold its dominance by relying on local Québécois celebrities (especially Claude Meunier, of La Petite Vie fame) to sell its product. "Pepsi" eventually became an offensive nickname for Francophones viewed as a lower class by Anglophones in the middle of the 20th century.
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By most accounts, Coca-Cola was India's leading soft drink until 1977 when it left India after a new government ordered The Coca-Cola Company to turn over its secret formula for Coke and dilute its stake in its Indian unit as required by the Foreign Exchange Regulation Act (FERA). In 1988, PepsiCo gained entry to India by creating a joint venture with the Punjab government-owned Punjab Agro Industrial Corporation (PAIC) and Voltas India Limited. This joint venture marketed and sold Lehar Pepsi until 1991 when the use of foreign brands was allowed; PepsiCo bought out its partners and ended the joint venture in 1994. In 1993, The Coca-Cola Company returned in pursuance of India's Liberalization policy. In 2005, The CocaCola Company and PepsiCo together held 95% market share of soft-drink sales in India. Coca-Cola India's market share was 52.5%. In Russia, Pepsi initially had a larger market share than Coke but it was undercut once the Cold War ended. In 1972, Pepsico company struck a barter agreement with the then government of the Soviet Union, in which Pepsico was granted exportation and Western marketing rights to Stolichnaya vodka in exchange for importation and Soviet marketing of Pepsi-Cola. This exchange led to Pepsi-Cola being the first foreign product sanctioned for sale in the U.S.S.R.. Reminiscent of the way that Coca-Cola became a cultural icon and its global spread spawned words like "coca colonization", Pepsi-Cola and its relation to the Soviet system turned it into an icon. In the early 1990s, the term, "Pepsi-stroika", began appearing as a pun on "perestroika", the reform policy of the Soviet Union under Mikhail Gorbachev. Critics viewed the policy as a lot of fizz without substance and as an attempt to usher in Western products in deals there with the old elites. Pepsi, as one of the first American products in the Soviet Union, became a symbol of that relationship and the Soviet policy. 19
In 1992, following the Soviet collapse, Coca-Cola was introduced to the Russian market. As it came to be associated with the new system, and Pepsi to the old, CocaCola rapidly captured a significant market share that might otherwise have required years to achieve. By July 2005, Coca-Cola enjoyed a market share of 19.4 percent, followed by Pepsi with 13 percent. Ingredients Pepsi-Cola contains basic ingredients found in most other similar drinks including carbonated water, high fructose corn syrup, sugar, colorings, phosphoric acid, caffeine, citric acid, and natural flavors. The caffeine-free Pepsi-Cola contains the same ingredients minus the caffeine. The original Pepsi-Cola recipe was available from documents filed with the court at the time that the Pepsi-Cola Company went bankrupt in 1929. The original formula contained neither cola nor caffeine.
Amount per 100mL Energy
196.5 kJ
Fat
0g
Sodium
0.98 mg
Carbohydrates 11.74 g Sugar
11.04 g
Protein
0g
Caffeine
10 mg
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PRODUCT POSITIONING OF PEPSI CO.
Pepsi prefers to position itself as the beverage choice of the “New Generation”, “Generation Next”, or just as the “Pepsi Generation”. These terms adopted in Pepsi’s advertising campaigns are referring to the markets that marketers refer to as Generation X. The Generation X consumer is profiled to be between the ages of 18 to 29. They have high expectations in life and are very mobile and active. They adopt a lifestyle of living for today and not worrying about long-term goals. Though Pepsi’s main emphasis is on this segment but they also have a focus on the 12 to 18 year old market. The rich deep blue coloring represents eternal youthfulness and openness. Marketing plans like “Yeh Dil Maange More”, “Got Another Pepsi”, “Ye Pyass Hai Badi” have made Pepsi one of the coolest brands recognized among teens in the top five and the only beverage product in this category.
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STRENGTH & WEAKNESSES OF PEPSI CO. Pepsi Cola throughout its 100 years of existence has developed much strength. One of the strengths that have developed Pepsi into such a large corporation is a strong franchise system. The strong franchise system was the backbone of success along with a great entrepreneur spirit. Pepsi’s franchise system and distributors is credited to bring Pepsi from a 7,968 gallons of soda sold in 1903 to nearly 5 billion gallons in the year of 1997. Pepsi also has the luxury to spend 225 million dollars in advertising a year. This enormous ad budget allows Pepsi to reinforce their products with reminder advertising and promotions. This large budget also allows Pepsi to introduce new products and very quickly make the consumer become aware of their new products. Pepsi-Cola provides advertising, marketing, sales and promotional support to PepsiCola bottlers and food service customers. This includes some of the world's bestloved and most-recognized advertising. New advertising and exciting promotions keep Pepsi-Cola brands young. The company manufactures and sells soft drink concentrate to Pepsi-Cola bottlers. The company also provides fountain beverage products. Pepsi also has had the good fortune of making very wise investments. Some of the best investments have been in their acquiring several large fast food restaurants. They have also made wise investments in snack food companies like Frito Lay, which at present time is the largest snacks company in the world. Probably high on the list of strengths is Pepsi’s beverage line up. Pepsi has four soft drinks in the top ten beverages in the world. These brands are Pepsi, Mountain Dew,
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Diet Pepsi, and Caffeine Free Diet Pepsi. Pepsi also has the No.1 tea in the United States, Lipton Tea. Some other strong brands are All Sport, Slice, Tropicana, Starbucks, Aquafina and a license agreement with Ocean Spray Juices. Pepsi Cola like any company has weaknesses. Ironically, the one strength that has been credited for most of its success in the past has now become a weakness for Pepsi. This former strength is the franchise system. The franchise system in Pepsi Corporate view has become a liability. Pepsi in today’s market must be able to act as one instead of several separate units. The franchise system has become a hurdle to Pepsi because many of these franchises have become very strong and will not be dictated by PepsiCo on how to handle their operations. Some of these franchises are unwilling to support certain Pepsi products and at times produce their own private label products that are in direct competition with Pepsi products. Secondly the franchisees are not willing to make capital expenditures to keep up with Coca-Cola who is a firm believer in reinvesting into their infrastructure (Coca Cola at present time does not operate a franchise bottling system). As mentioned earlier Pepsi has tried to elevate this problem by spinning off their interest in fast food restaurants but at present time are still guilty by association to many of the large fountain accounts. The franchise system has also affected fountain sales due to the fact franchisees are not willing to buy expensive fountain equipment to place in accounts mainly because the profit margin is so low and could take years to recoup their investment. Pepsi also has a weakness in the international beverage market.
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Unfortunately for Pepsi they were a “Johnny Come Lately” into this arena. Pepsi has tried to enter this market by trying to do in three years what took Coke 50 years to do. This area will take years for Pepsi to mature simply due to Coke’s dominance in the international market and the strong ties that Coke has developed with these markets and their governments. Pepsi customers buy nearly five billion gallons of soft drinks per year. Pepsi customers buy their products because of taste, price, packaging and promotional factors and of a wide variety of brands. Pepsi customers also buy their products due to the high accessibility of Pepsi brands. Pepsi products are distributed to many outlets. For example, supermarkets where Pepsi buys large shelf area and display areas so the customer can find them easier, viz, Convenience stores, Restaurants, Movie theaters and almost and other conceivable spots. Pepsi has a competitive advantage over Coke because of the image it portrays. Pepsi promotes itself as the choice of the “New Generation”. Pepsi gets this advantage by implementing such large marketing projects like “Project Globe”. This marketing plan, which Pepsi spent 637 million dollars over five years, is to introduce the new rich deep blue coloring of its packaging. The rich deep blue coloring represents eternal youthfulness and openness. Marketing plans like this made Pepsi one of the coolest brands recognized among teens in the top five and the only beverage product in this category. Another competitive advantage that Pepsi has is in their product Mountain Dew. Mountain Dew has grown a staggering 74.1% over the last five years. Mountain Dew has a 6.3% market share and has recently become the No.4 soft drink in America. At
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this current pace Mountain Dew will be come the first non-cola to reach the 1billion gallon mark in one year. Pepsi also has an advantage as an innovator in their field. They are the first soft drink makers to introduce a new one-calorie soda called Pepsi-One with, just approved by the FDA, Ace-K. This new sweetener is slated to be a break through for diet soda in which it limits the after taste associated with diet soda and brings a more cola taste to the product. Pepsi has always been a strong No.2 against Coke and have become one of the world’s largest Companies. As far as market share is concerned Pepsi stands strong.
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PEPSI-THE INDIAN EXPERIENCE • Pepsi is one of the most well known brands in the world today available in over 160 countries. The company has an extremely positive outlook for India. "Outside North America two of our largest and fastest growing businesses are in India and China, which include more than a third of the world’s population." (PepsiCo’s annual report, 1999) • This reflects that India holds a central position in Pepsi’s corporate strategy. India is a key market for PepsiCo, and at the same time the company has added value to Indian agriculture and industry. PepsiCo entered India in 1989 and is concentrating in three focus areas – Soft drink concentrate, Snack foods and Vegetable and Food processing. • Faced with the existing policy framework at the time, the company entered the Indian market through a joint venture with Voltas and Punjab Agro Industries. With the introduction of the liberalization policies since 1991, Pepsi took complete control of its operations. The government has approved more than US$ 400 million worth of investments of which over US$ 330 million have already flown in. • One of PepsiCo’s key strategies was to develop a completely local management team. Pepsi has 19 company owned factories while their Indian bottling partners own 21. The two advertisements tags: ‘yehi hai right choice baby’ and ‘nothing official about it’ immediately ring a bell- it’s got to be Pepsi.
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The advertisement tag ‘yehi hai right choice baby’ was the first ‘Hinglish’ slogan ever used in the in the Indian market. This slogan proved to be the best suited one for Pepsi and it was a mega hit and at that moment of time. Pepsi in a short span of its operations in India has found a place in the hearts and minds of the Indian consumers. The success has primarily been due to the innovative and passionate Indian team, which has been built over the years. Pepsi is a trendsetter managed and run by Indians, where important decisions are taken locally. Pepsi started its operations in India in 1989 and since then PepsiCo has set up a fully integrated operation in India viz. Manufacturing, Research & Development, Marketing, Distribution and Franchising- covering fruit/vegetable processing, Exports, Snack Foods & Beverages. In the mean time Pizza Hut and Frito Lay’s are the examples in this regard only. Pepsi has 40 bottling plants in India, out of which 16 are company owned and 24 are owned by Indian franchisees. The PEPSICO INDIA HOLDINGS PVT LTD beverages in India's leading supplier of retailer brand Carbonated and Non-Carbonated soft drinks, with beverage manufacturing facilities in India. Its experience in the beverage industry dates back to the sixties when it had the first franchise at Agra. It has the license to supply beverages in the territories of UTTAR PRADESH, part of M.P., half of Haryana, whole of Rajasthan, Goa, 3 districts of Maharashtra, 9 districts of Karnataka.. This bottling plant one of the largest producing PEPSI bottles in INDIA. Its have six pipelines through which 600 bottles produces per minute its
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means 3600 bottles produces per minute which makes PEPSICO INDIA HOLDINGS PVT LTD BEVERAGES one of the highest bottles manufacturing in INDIA. This manufacturing plant brought name and fame to the Pepsi as in all this regions Pepsi is at the commanding position and in the mean this plant has diversified function perform in the field of growth and success of PEPSI..
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PEPSI – BRANDS AND PACK PROFILE BRAND PACKS: The brands which manufacturing in PEPSICO INDIA HOLDINGS PVT LTD beverages in as follows-: •
GLASS BOTTLES
•
DISPOSABLE CANS
•
PET JARS
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FLAVOUR PACKS:
COLA (Carbonated Soft Drink): •
PEPSI
ORANGE: •
MIRANDA ORANGE
•
MOUNTAIN DEW
•
7UP
MANGO: •
SLICE MANGO
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DRINKING SODA : •
EVERVESS SODA
MINERAL WATER: •
AQUAFINA
Carbonated Soft Drinks (CSD) or Soft Drinks as they are popularly known is one of the largest FMCG market in the whole world with the total annual sales of around $40 billion.
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THE PEPSICO INDIA HOLDINGS PVT LTD, DELHI
The PEPSICO INDIA HOLDINGS PVT LTD., Delhiis one of the biggest bottling plant in INDIA .The date of announcement of this project was held on Saturday 1st April 1995 and it was completed on 31st December 1999.The investment was made on this project Rs60 cores/ U.S.$ 15 million. The PEPSICO INDIA HOLDINGS PVT LTD is one the largest bottling plant which has six pipelines in which each pipelines produces 600 bottles per minute and total number of bottle produces is 3600 bottles per minute. The vice president of PEPSICO INDIA HOLDING PVT LTD, DELHI is Deepak Jolly and the executive director of this company is Mr. Ravi Kr Singh who looks all the key areas of human resource management and function of the company. The PEPSICO INDIA HOLDINGS Pvt Ltd is one of the strongest production area of Pepsi who not only deals only the production but also deals in marketing and sales area which strengthen the PEPSI for its growth and capturing the INDIAN market with motive of high earning profits and creating and benchmark in the market.
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MAJOR CREDENTIALS
Varun beverages limited received “gold standard award” for production &
quality control for the year 1996-1997.
Jaipuria group was adjudged “best bottler” out of more than 2000 bottlers
all over the world for the year 1996-97.
LOCATIONS OF BOTTLING PLANTS OF PEPSI IN INDIA
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OBJECTIVES OF THE PROJECT The Project “Marketing and Sales Promotion of Pepsi” was designed on the lines of basic investment decisions to be taken by the senior officials of PEPSI for the purpose of amendments in the pre-existing distribution network in order to review and strengthen the routes. The findings of the project are very crucial for the increment of the market share of PEPSI in the Delhi . Beverage Market. Though the process is an ongoing one but the decisions have to be taken on a strong base, supported by facts and figures and that too on papers. This support can only be provided with the help of an extensive and through analysis of the market and the data collected thereof. The objectives of the project were delivered to us express sly by the Marketing Development Co-ordinator who was the lead or the project head and we had to submit the day report to him along with the draft report. He was the in charge of the project and gave guidelines and directions to approach the project. The objectives of the project are:
To analyze, interpret and study the entire beverage market of Delhi
Comparative study of the various brands, packs and flavors available in the market.
Analysis of the strong and weak point of the competitors products and compare it with PEPSI.
To assess the reach and feasibility of the product and give the output for further investment for enhancing the distribution network along with assessing the efficiency of the current distribution system. 34
Assess the promotional measures in the context to the sales of PEPSI and focusing our study on the customer of company i.e., the retailers. As obvious that any company is concern with the increase in sales of its
products, our project was in line with the companies’ objectives and all steps incorporate in the project were directed to give an overview so as to attain its objectives. The market research conducted by us was in accordance to the company’s rules and policies which were quite material for the efficient and effective results and inferences to be drawn from the entire process. The market research was conducted in compliance of the given guidelines delivered to us expressly to achieve the given objectives, which were as under: 1. Profitability
4. Improvement
2. Sales
5. To satisfy the customers
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RESEARCH METHODOLOGY THE MARKET RESEARCH PROCESS The entire project was divided into five phases and each phase had its individual significance and supplemented each other. The process had to be started from the grass root level and it was very important to understand the market for this FMCG product, which is very fast in production, distribution and consumption. The five phases into which the project was divided were: A.
Route Riding
B.
Retail Tracking
C.
Corporate Tracking
D.
Analysis of finding and observations
E.
Segregating Delhi
The entire process was more of a Descriptive Research type and incorporated a formal study of the specific problems faced by most FMCG companies an exploring the opportunities in the untapped market. The survey was conducted on the basis of PEPSI product preference and evaluation of sales forecast in the new and underdeveloped market including the evaluation of the advertising and promotional measures. The data collected had to be systematically arranged, analyzed and reported in a form congenial to take on the spot decisions. The observation approach was adopted in the process by gathering the data essential and material for the decision-making and with clear objective of increasing the market share of PEPSI in the Delhi. market. Customer preferences and satisfaction was also important in assessing the market share but that was very clear that customers generally do not have loyalty towards the product in the Beverage industry rather what matters the most is the product availability which will be discussed later.
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All the phases mentioned above have been discussed along with the observations, problems, and other dimensions which have been encountered and experience in detail in the following pages.
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ROUTE RIDING The Beverage Industry or to be more specific, the Soft Drinks Industry has one of the most active network in term of its production, supply, distribution, marketing, consumption and also personal relations at the very second level of its distribution network. That is the reason why it is sometimes said to be “Very Fast Moving Consumer Goods”. Due to the above stated reason it becomes very essential to study and analyze the market of these products from the grass root level. So in the Soft Drinks Company as PEPSI, route riding becomes the first and foremost step in any of the activities to be undertaken be it any official so we were no exceptions. During the very initial days we were required to exercise Route Riding, the objective of which was: •
To understand and analyze the market in its raw and basic form.
•
To gain an in depth knowledge of the merchandising and processing activities of the Route Agents and understand the Beverage market.
•
To undertake the comparative study of the various brands and flavour packs of all existing beverages or soft drinks market and the market share and growth potential of each brand individually.
•
To develop innovative ideas to enhance the distribution system.
Route Riding is basically accompanying Pepsi Vans along with the route agents and understanding the way they conduct merchandising activities right from the charged
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vans leave the depot to the entry of empty vans back to the depot. The Route Riding phase was for the initial twinty days in which we had covered twinty different routes. The Route Riding is a crucial phase because the actual dealing with the retailers and their dealing with the customers can be very efficiently understood through this process which is important at all levels of decision making in the industry. The Routes i.e., the Pepsi Vans were charged and left the depot by 7:30 in the morning, accompanied by the Route Agent
(R.A.’s). The RA’s were given the route
planners and the particulars of the products, flavors, and quantities along with the billing materials. The vans had to cover the entire route and the RA had to do the merchandising and sales against cash, which was a significant feature of this industry. The targets were given twice or thrice in a week that was a challenge for them and after achieving these targets the RA’s was awarded with some special incentives. As there exists a player like Coca Cola. So it had a lot to do with schemes, discounts and other incentives. The routes were allocated on the basis of individual areas and the demand of the product in that particular area. The RA’s been responsible for the accomplishment of their sales target on their routes and was given incentives on achieving the targets. Not only this, the RA’s also had the responsibility of moving the flavors and packs in proportion along with the proper display of the products for proper visibility and arrangement of products in brand order along with “VISI purity”. The RA’s had the responsibility of setting up Monopoly PEPSI Sales Counters where no products except that of PEPSI would be available amongst the soft drinks and especially of Coca Cola. These monopoly sales counters enjoyed special benefits in
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terms of discounts, schemes, VISI’s (fridges), display boards, glow signboards, wall paintings, banners, posters and other incentives. The RA’s had to achieve their sales target and surrender the daily sales proceeds with the concerned Customer Executives along with the route planner and billing materials and gate pass along with the details of sales on their route. The entire activities of the RA’s was controlled by the Customer Executives, who also assisted the RA’s in achieving their targets and were in charge of the sales performance in their assigned areas. A Customer Executive had nine to ten RA’s under him and was responsible for their performances as well. He was also concerned with the promotional activities on his routes and handling of policy matters in the corporate regarding supply to industrial canteens and cafeterias. We as Research trainees were required to study and analyze the activities of the RA’s and be familiar with the market. We had been provided Market Analysis Sheets by the MDC in which we were required to record the observations of the retail outlets on a particular route. The observations, which were required to be recorded in, were: •
The quantity of the cold and warm stocks of all brands and flavors available at the outlet along with the outlet details.
•
Inquiring about the satisfaction of the retailers in terms of sales of PEPSI products, schemes, discounts, combo offers, and the benefits of promotional activities.
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•
Inquiring about the satisfaction by the current distribution network in context to product availability of all flavors packs or individual flavors according to demand of customers, rates billings.
•
Inquiring about the behavior and merchandising of RA’s in accordance with the companies’ regulations and record complaints against RA’s, company or products, if any.
•
Inquire about the performance of various brands and flavors packs and customer’s response to those brands or flavors and also to educate the retailers about various schemes and incentives to increase sales volume.
•
Last but not the least, assessment of the effectiveness of, assessment of the effectiveness of promotional materials and activities like, display boards, glow signs, signage, wall paintings, posters, banners, racks, shelves, counters, VISI’s, and also impact of nation wide advertising on brand loyalty by the customers.
The information so collected was required to be filled in the Market Analysis Sheet (specimen on the next page) and reported to the MDC along with other information in order of their seriousness.
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RETAIL MAPPING OF DELHI The Retail Mapping is the integral part of the project and the most crucial is taking significant decisions regarding the enhancement of the distribution network involving heavy investment on account of increasing the routes and starting new routes and promotional measures on those routes to increase its market share in Delhi The new routes, exploring new markets required the decision to be supported with facts and figures which had to be provided by the Research trainees on the basis of the survey conducted in the market and processed data there of. The retail mapping had to be conducted on the basis of the Retail Tracking Sheet (RTS), which had been developed by the Marketing Development Coordinator and Customer Executives of the Delhi unit which incorporated the retail outlets, their addresses, proprietor, respondent etc and served as a vital database for all market since then for PEPSI in Delhi and had to be incorporated in the project in accordance to the companies policies. Objectives of Retail Mapping:
•
Segregating entire Delhi for Strong Area Programme and Weak Area Programme i.e., SAP and WAP.
•
Assessment of retailer’s performance.
•
Assessment of the level of promotional measures required for increasing market share of PEPSI.
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•
Collection of required information for making investment decisions for the enhancement of existing routes and opportunities for new routes in existing market as well as exploring new market.
•
Classification of all retail outlets in Delhi into five broad categories viz, On Route, Non Existence, Non Potential, Reachable and Non Reachable under the head, Potential Retail Outlets.
The duration for the completion of the Retail mapping took duration of 20 days. The entire survey was guided and directed by the Customer Executive and Daily report had to be presented to him after assessment and analysis along with other findings and observations. The Data had to be classified in a systematic manner and presented in a predefined format, which was further reviewed by the Marketing Development Coordinator. The Retail Mapping process incorporated of including of new outlets, which have been omitted or newly opened, and the product availability on all these outlets. The major thrust was on segregating the market for Strong Area Programme and Weak Area Programme. The Strong Area refers to the routes on which the sales targets are met without much effort and have continuous demand for the products. These areas are performing to the standards and are contented with the level of promotion schemes and other sales boosting measures. The marketing efforts are nominal in these areas because of the surplus demand and the area of concern is only to ensure the proper and efficient supply of the products to meet the demand. In the Delhi market approximately 45% of the market can be said to be strong areas and these areas include the well-developed markets as shopping malls, movie theatres, convenios, hotels, restaurants and 43
bars etc. For these Strong areas, SAP only aims at maintaining the performance of the product and enhancing the sales volume. It is not the area of serious concern for the company. On the contrary the Weak Area refers to those areas or routes, which are critically low in sales and the targets, are tough to achieve and require aggressive marketing support. The demand in these areas is fluctuating or rather feeble. The routes are the area of concern for the company as the demand is very low due to many reasons and the major one is the existence of the player like Coca Cola in the market. Other reasons could be poor distribution network, inadequate availability of the products on the outlet, inadequate promotional measures and marketing support, undeveloped market as that of the interiors etc. These weak areas had to be identified and the cause of their inferior performance had to be traced through the Retail Mapping and the company had to be provided with the facts and figures to take legitimate measure on the basis of the findings of the deficient performance of the product in these areas. This involved the aggressive marketing strategy and heavy investment decisions to strengthen these markets. For this purpose the classification of the outlets into five categories was very crucial along with the other findings and observations discussed later. These five heads of classification have been discussed as under. ON ROUTE: It refers to the retail outlets, which are covered by the Route Agents and visited daily for sales and merchandising. The outlet is visited daily and actively involved in the sales of all brands and flavor packs of PEPSI.
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NON EXISTENCE: It refers to the outlets which were merchandising the product
are no more in
existence, i.e., they have diversified their business activity or have closed. NON POTENTIAL: It refers to those outlets, which are in existence but have very low potential in terms of sales or are not keenly interested in merchandising the products of soft drink. A careful assessment had to be done in case of Non Potential outlets, as they would turn to be potential in near future. It was also the area of operation of project to motivate these Non Potential outlets to undertake the merchandising of PEPSI. POTENTIAL OUTLETS : It refers to those outlets, which have the potential for the merchandising of PEPSI and have the required investment capabilities and can be the profitable Point Of Purchase of PEPSI by the customers. There were cases in case of these potential outlets, which were already merchandising PEPSI, and those, which did not, dealt with beverage products. The possibilities of setting monopoly counter were very fair at these outlets and were given special attention. The Potential outlets had to be further classified in two heads as below: REACHABLE POTENTIAL OUTLETS : It refers to those Potential outlet which are reachable i.e., the products can be made available with the PEPSI vans. The reach ability decision had to be taken in context to the accessibility of the vans at these outlets.
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NON REACHABLE POTENTIAL OUTLETS : It refers to those Potential outlets which are not accessible by the PEPSI vans. These outlets had to be considered because the sales volume can be increased at these outlets and so alternative method of distribution and promotional activities have to be evaluated and worked upon. CORPORATE MAPPING: Delhi being an entirely industrial city had huge potential for the sales of PEPSI in corporates as these concerns had factories, offices and canteens and the officials and workers base was very strong. The process of Retail Mapping was followed by the Corporate Mapping, which incorporated of tracing of the organizations and assessing the market for PEPSI in these areas. Apart from these the database had to be updated to turn the non-potential market in the corporate into profitable liaisons for the increment of sales volume. THE OBJECTIVES OF CORPORATE MAPPING WERE:
Trace the organizations with and without canteens and cafeterias and
estimate the market for PEPSI.
Estimate the brand preference of PEPSI and COKE in the corporates
and the reasons thereof.
To review the product performance and satisfaction along with the
expectations of the customers in corporates including PEPSI Dispenser Equipments.
To assess the product availability and demand of the product (Traffic)
in these organizations as well as when the product has the optimum consumption
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e.g. daily, delegations, meetings, parties, or other occasions and the customers i.e., whether the officials or workers or both.
To ensure efficient supply and record any complaints or grievances
thereof.
To assess the promotional measures being adopted by Coca Cola for
tapping these markets and locate the weak points in corporates having Coca Cola counters to convert them into profitable opportunities. The Corporate Mapping was the supplementary programme in the project to boost the sales performance of PEPSI in NOIDA & NCR and capture the market share of its nearest competitor. The analysis and findings were recorded on the format provide by the company accompanied by the list of findings and observations in order or their preference and seriousness along with all the relevant details about the organization. The matters were discussed and analyzed carefully by the MDC. The corporate matters had to be given a special care as these had huge potential for the product. The specimen copy of the Corporate Mapping format is attached for reference. The findings and observations have been discussed in the coming pages.
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ANALYSIS OF FINDINGS AND OBSERVATIONS The main objective of the company is to increase the brand preference and market share so any information material form this point of view had to be take into account along with the formats provided by the company for predefined information recording and analysis of those recordings and present the information in an organize and systematic manner in a condensed form reflecting the actual position of the market. The information had to be recorded in the format along with the relevant information as per the objectives of the research and an analysis of that information had to be made and present them in an understandable format so that immediate inferences can be drawn. Generally those information had to be presented in percentages and the other findings and observations had to be evaluated and a list of findings had to be arranged in order of their seriousness and areas of serious concern along with the outlet details. After the analysis sheets and formats have been surrendered to the C.E’s after analysis by the trainees it was further analyzed and evaluate by him and a brief analysis was made each day of the daily report. The CE’s further forwarded these reports after retaining the reference copy, to MDC for further review and reference. SEGREGATION OF DELHIFOR SAP AND WAP As discussed earlier that the major objective of the Retail Mapping of Delhi was to segregate the market for PEPSI for the Strong Area Programme and the Weak Area Programme. These Programme have been discussed under the Retail Mapping Head. The Data and fact collected by the survey had to be analyzed and presented in a systematic form in order to draw meaningful inferences. The finding of the Route Riding and the Survey conducted during the Retail Mapping and the Corporate Mapping were combined together and analyzed together to reach a final report ie, the RETAIL MAPPING SUMMARY or THE CONDENSED DRAFT REPORT, which gave the entire picture of the actual position if PEPSI in Delhi.. The report so prepared was on the basis of the Retail Tracking Sheet and the other supplementary finding and observations were considered to reach a consensus of declaring the route as a weak area or a strong area.
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The reports were analyzed thoroughly by the Customer Executives and a meeting was held for the assessment of the routes and the reasons of unfavorable performance in the weak areas and how to improve the sales on those routes. The discussion comprised of the further investments for the enhancement and extension of the routes and the level of promotional measures required in these areas. The performance of Coca Cola was also reviewed simultaneously and a comparative study was made to assess the performance and growth in the industry. These data and figures were compared with that of the last year and a growth percentage was reached which also served as a basis of declaring an area as a Weak Area. As already mentioned PEPSI is a VFMCG so the marketing strategies are going to be very dynamic in nature. The Customer Executives had to formulae day to day strategies and these were communicated to RA’s in the morning when they were going to leave the depot and this interaction among R.A.and C.E. was to be known as Gate Meeting. The programmes were to be based on the seriousness of the problems and accordingly a mild or aggressive marketing, promotional and investment programme was to be formulated.
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FINDINGS & OBSERVATION The reports of each phase of the project had to be supplemented by the information, data, facts and figures and significant findings and observation to support the feasibility of decisions to be taken on the basis of the Retail mapping Summary or the CDR. The information so recorded in each phases of the project had to be listed in order of their relevance and seriousness and presented in a form to facilitate immediate inference. Some of the important observations have been listed below:
Soft drink business’s behavior is not governed by brand loyalty so the availability of the right brand, at the right place, at the right time is the key for winning consumer in soft drink business.
The most important and satisfying observation was that, PEPSI had approximately 69% market share in the soft drinks market in Delhi. and some of its brands like Mirinda Orange and Mountain Dew were performing above standards apart from PEPSI Cola in spite of the Coca Cola with two cola flavor packs i.e., Coke and Thumps up.
The present distribution system of PEPSI is the best in the entire FMCG industry in Delhi. and the major strength of PEPSI. The enhancement in the distribution network would definitely increase the market share of PEPSI.
The retailers played a very critical role in the increment in the sales volume of the product and the had to be kept satisfied in order to increase the market share by offering better schemes, discounts, display materials such as VISI’s, racks, counter, signage, wall paintings and better amount for purchase of shelf space for display.
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The existence of sub-dealers and super stockiest are also the major area of problem, as they do not move the schemes and other display materials and incentives information to the retailers, which is one of the reasons for the dissatisfaction of retailers.
The cut throat competition between PEPSI and COKE had lead to the never ending cola war and price war which has brought down the profit margins which is one of the major grievances apart from the common complains pertaining to schemes, incentives and display materials.
The other major issue was the supply of PEPSI from the bottling plants in Delhi and Punjab against the company policies. These plants supplied the products at discounted rates and violated merchandising principles of PEPSI.
Another critical issue was the presence of duplicate products of PEPSI in the market. The details of these outlets have been surrendered to the company for action against these outlets.
The position of PEPSI in the corporates was not up to the mark and Coca Cola had a better scene in this context. One of the reasons can be assigned to the product positioning of PEPSI and Coca Cola.
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MARKET STATUS OF PEPSI PRODUCT
PEPSI-COLA PRODUCTS Aquafina 7%
Lehar 7-Up 9% Pepsi 24%
Lehar Soda 4%
Mirinda Orange 14%
Slice 20%
Mountain Dew 19%
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Mirinda Lemon 3%
PREFERENCE OF SOFT DRINKS IN QUANTITY
2 LT. 24%
200 ML 37%
330 ML (CAN) 2% 600 ML 12% 300 ML 25%
RATIO OF CONSUMPTION OF SOFT DRINKS PER 100 CONSUMERS
Once in a week Never 3% 1% Occasiona ly 4% Daily 13%
Twice in a week 12%
Often 67%
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The other Statistics and finding have been presented in the form of various charts on the coming pages: DEMAND OF SOFT DRINK
10%
50%
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CONSUMTION OF PEPSI BRAND
PEPSI 7UP, 10
M.DEW
OTHERS, 5
MIRINDA
PEPSI, 40
SLICE, 15
SLICE MIRINDA, 15
7UP
M.DEW, 15
OTHERS
RATIO OF PEPSI AND COCK IN DELHI
O TH E R S , 11
P E P S I, 45
CO CK , 44
PEPSI CO CK O TH E R S
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RECOMMENDATIONS The Project Retail Mapping was concerned only with providing the organization with all the necessary information required to strengthen the position of PEPSI in Delhi. in the form of reports incorporating all information in an analyzed and summarized form. But some critical and major issues, which have been identified on account of extensive analysis, required suggestions to be put forward on the basis of the current market scenario.
There should be uniformity in, schemes, and discounts, which are offered to the retailers and should be based on a specific parameter such as sales volume, to avoid dissatisfaction and biasness among the retailers.
Activities of sub dealers and super stockiest should be controlled and checked in order to ensure fair prices and distribution of schemes and incentives to small retailers to avoid discontent among smallholdings and outlets.
Every possible step should be taken for the satisfaction of the retailers, as they are the most important supplement to the sales promotion measures and nationwide advertising campaigns of the company in context of boosting the sales and enhancement of the brand image of PEPSI.
The operations of the bottling plants of the surrounding territories should be controlled in order to ensure that they do not supply the product in other territories not under their area of operation.
The company should modify its advertising strategy and educate the customers about its age-old existence and enhance its brand image. This will appeal to the target customers of middle and older age groups apart from the younger generation in which PEPSI has a good hold.
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First and foremost things are that, whatever the policy is going to be formulated it should not be same for all the areas. Different policies should be framed and implemented at different areas by looking and keeping various variables in the mind like buying habits, preferences, education level financial position of that particular area and standard if living etc.
Rural market being a very potential segment needs very quick and prompt efforts to be taken to capture this high volume market.
Many retailers complained regarding irregularly in visit by the executives. They also said that executive give very bad response to their complaints. It is necessary that executive should make frequent visit to cover each outlet and try to provide them best
Pouches, foreign particles were found in few bottles, so proper quality control measures should be implemented as company’s reputation are at stake.
There is a great market of soda (1 Lit.) but the supply of this pack is very poor, so the supply should be made possible quickly.
Quality of PET bottle should be improved so that most problems can be minimized.
Soft drink is still considered a treat virtually a luxury, so it possible company should cut down its price especially of cans.
Supply of posters, glow-sign boards, tin boards, banners and sun pack sheets etc should be made at regular interval.
Claim should be provided to the deserving retailers.
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Wall painting should be made regularly in the area, as it is a good medium of advertisement.
Proper attention should be given to the retailer’s problem so that they take interest to increase the sale.
Proper advertisement should be made at railway station, bus stand, posh area, major market and economies place etc.
A company may create favorable impression among the youth if they sponsors small events like college festivals, university programs, school functions, fashion shows, quiz programs etc.
Retailers need display material. To enhance the marketing of the product.
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LIMITATIONS The retailers in many cases reluctant to answered many questions. The respondents may be biased on influenced by some other factors. Time and money were the greatest limitation in carrying out the survey. A number of retailers (pan-shop) being illiterate, it took us lot of time in collecting information. The mere information which we get from the retailers is not sufficient to arrive at a conclusion. The seasonal changes affect the sell.
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MAIN KEY POINTS Service aspect of agencies is very effective, they deliver their product according to the demand a just in time. After
conducting
the market survey
of retailer
in Delhi
city,
I analyze that Pepsi-Cola is dominating over Coca-Cola in the sale of PET. After analyzing the market and calculate the weightage, the result comes out that Mountain Dew is the leading product of Pepsi-Cola. Consumers do have a demand for 200 ml and 2 lit. bottle. Retailers have problem in display material. Most of the place like cinema hall and educational institutions are dominated by Pepsi-Cola. Retailers have complaint regarding the PET, that more better quality bottle should be used. Aquafina (Pepsi-Cola) in Ghaziabad city dominated Kinley (Coca-Cola) mineral water. Retailers have a demand of some offers and free gifts. Kinley soda (Coca-Coal) is also dominated by Lehar soda (Pepsi-Cola) in Ghaziabad city. Maaza (Coca-Cola) is also dominated by Slice(Pepsi-Cola). It was seen that Lehar Soda (1 lit.) in particular remains short during the season. In the market there is only a retailer on which the sale of the different product of different company depends.
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CONCLUSION The business of Soft Drink industry is significantly based upon the impulse buying, so it is very necessary to Merchandise products of PEPSI efficiently and present them in such a manner so that it can motivate the consumer and generate a thirst in consumer to consummate it. Though, PEPSI has a strong position in NOIDA & NCR with the support of its efficient distribution network, aggressive marketing efforts and advertisements along with attractive schemes but there still exists potential market in Delhi to be exploited and a suitable Weak Area Programme or the Strong Area Programme has to be formulated to improve its market share depending upon the area under consideration. Soft drink business’s behavior is not governed by brand loyalty so the emphasis is not only on creating the market but also on retaining it. The availability of the right brand and flavor pack, at the right place, at the right time is a key for winning the customer in soft drink business. Keeping these facts in mind it becomes very important to treat the retailers with concern and satisfy them by various measures and so that they are loyal towards PEPSI. Public relation is also critically important in this industry.
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QUESTIONNAIRE
Q.1. Are you aware of Pepsi house hold scheme ? a. yes
b. no
Q.2. Do you provide home delivery of Pepsi ? a. Yes
b. no
Q.3. How many houses? Q.4. Which brand of soft drink do you sell? a. Only Pepsi-Cola
b. Only Coca Cola
c. Both.
Q.5. Which quantity of soft drinks you have? a. 200 ml d. 2 lit.
b. 300 ml
c. 500 ml
e. All.
Q.6. Which brand of soda do you sell? a. Leher Soda (Pepsi-Cola)
b. Kinley(Coca Cola)
Q.7. Which brand of mineral water do you sell? a. Aquafina (Pepsi-Cola)
b. Kinley (Coca Cola) c. Others.
Q.8. Chilling equipment owned by you? a. Only Pepsi-Cola
b. Only Coca Cola
Q.9. Do you get timely supply of these brands with proper schemes? a. Yes
b. No.
Q.10. Is your chilling equipment working properly? a. Pepsi-Cola b. Coca-Cola =
= Yes…. No…. Yes…. No….
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c. Both.
Q.11. During breakdown of chilling equipment who gives better service? a. Only Pepsi-Cola
b. Only Coca Cola
c. Both.
b. Only Coca Cola
c. Both.
Q.12. Whose racks do you own? a. Only Pepsi-Cola
Q.13. Is there increase in sales due to display of the racks? a. Yes
b. No.
Q.14. Availability of glow boards provided by company through promotional scheme. a. Yes
b. No.
Q.15. Are your customer aware of PEPSI HOUSE HOLD SCHEME? a. Yes
b. No
c. Can’t Say
Q.16. Has it effected your sale? a. yes
b. no
c. cant say
Q.17. What %tage increase you got after this scheme? a. 5-15%
b.25- 30%
c. more than 50%
Q.18. 200 ML STOCK REGULAR
PCI
600 ML PCI
300ML CCX
PCY
CCX
CCX
2 LIT PCI
CCX
STOCK PET
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BIBLIOGRAPHY
Marketing Management Principles of Marketing
(Written by Philip Kotler) (Written by C. B. Gupta)
Research Methodology
(Written by C. R. Kothari)
Magazines: Advertising Management Business India Business Today Business World www.pepsiworld.com www.pepsico.com www.google.com
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