Pepsi Strategic Marketing

Strategic Marketing

Pepsi Cola

Pepsi CO. CORPORATE INFORMATION PepsiCo, Inc. is among the most successful consumer products companies in the world, with 1998 revenues of over $22 billion and 151,000 employees. The company consists of: Pepsi-Cola Company, the world's second largest beverage company; Frito-Lay Company, the world's largest manufacturer and distributor of snack chips and Tropicana Products, Inc., the world's largest marketer and producer of branded juices. PepsiCo's brand names are among the best known and most respected in the world. Some of PepsiCo's brand names are 100 years old, but the corporation is relatively young. PepsiCo, Inc. was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay. Tropicana was acquired in 1998. PepsiC PepsiCo's o's succes successs is the resul resultt of superi superior or produc products, ts, high high standa standards rds of performance, distinctive competitive strategies and the high integrity of their people. Their overriding objective is to increase the value of their shareholders' investment investment through through integrated integrated operating operating,, investin investingg and financin financingg activities activities.. Their strategy is to concentrate their resources on growing their businesses, both through internal growth and carefully selected acquisitions. Their strategy is continually fine-tuned to address the opportunities and risks of the global marketplace. The corporation's success reflects their continuing commitment to growth and a focus on those businesses where they can drive their own growth and create opportunities

PepsiCo Mission Statement: "Pepsi "PepsiCo' Co'ss overa overall ll missio mission n is to increa increase se the value value of our our shareh sharehold older' er'ss investment. We do this through sales growth, cost controls and wise investment of resources. We believe our commercial success depends upon offering quality and value to our consumers and customers; providing products that are safe, wholesome, economically efficient and environmentally sound; and providing a fair return to our investors while adhering to the highest standards of integrity."

CORPORATE CORPORA TE CITIZE CITIZEN N PepsiCo has a long tradition of corporate citizenship. Community Through the PepsiCo Foundation and their operating divisions, they made grants totaling more than $21 million. The funds supported a variety of projects, focusing on education, diversity, humanitarian efforts and other areas of need. they they enco ncoura urage emplo mploye yee e vol volun unte tee erism rism thr through ough a dou doubleble-m match atch of contributions to organizations in which they are active, as well as through volunt volunteer eer days days and and other other opportu opportunit nities ies.. In additi addition on,, PepsiC PepsiCo o is involv involved ed in hundreds of community organizations, including many focused on diversity and inclusion. As their market grows increasingly diverse, they have made a very very focu focuse sed d eff effort ort to prom promot ote e dive divers rsit ity y as a genu genuin ine e com competi petiti tive ve initiatives, this this effort includes: Appointing executives advantage. Among other initiatives, 1

Strategic Marketing

Pepsi Cola

dedicat dedicated ed to manag managing ing diversi diversity. ty. Develo Developin pingg multimulti-yea yearr plans plans to promot promote e diversity. Creating diversity advisory advisory boards. boards. Creating networks to mentor mentor and suppor supportt minori minority ty and female female employee employees. s. These These effort effortss have have been widely widely recognized.

Environment and Safety Their enviro Their beverage beverage environm nmenta entall and and safety safety record recordss are are strong strong.. Their containers are recyclable and they have consistently reduced the amount of materials used to manufacture their containers. Pepsi-Cola cans contain more than 50% previously used aluminum cans. Their glass bottles contain up to 35% previously used glass. In the United States, Pepsi-Cola will begin using recycled plastic in 2002, with a goal of using 10% recycled material in its plastic bottles by 2005. All their divisions recycle. Tropicana recycles orange and grapefruit grapefruit peels as cattle feed; Frito-Lay similarly recycles leftover potato peels. Frito-Lay reuses millions of delivery boxes that once were were discarded after a single single use. In the area of safety, PepsiCo facilities to its employees the maximum level of safety equipment.

CORPORATE CORPORA TE CITIZE CITIZEN N

1898 Caleb Bradham, a New Bern, North Carolina pharmacist, renames "Brad's Drink," a carbonated soft drink he's created to serve his drugstore's fountain customers. The new name, Pepsi-Cola, is first used on August 28. 1902 Bradham applies to the U.S. Patent Office for a trademark for the PepsiCola name.

1903 In keep keepin ingg with with its its orig origin in as a phar pharma maci cist' st'ss conc concoc octi tion on,, Brad Bradha ham' m'ss advertising praises his drink dr ink as "Exhilarating, invigorating, invigorating, aids digestion."

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1905 A new logo appears, app ears, the first change from the original in 1898. PepsiPepsi-Col Cola's a's first first bottlin bottlingg franc franchis hises es are establ establish ished ed in Charlo Charlotte tte and Durham, North Carolina.

1906 Pepsi gets another logo change, the third in eight years. The modified script logo is created along with the slogan, "The Original Pure Food Drink." There are 15 U.S. Pepsi bottling plants. The Pepsi trademark is registered in Canada. Syrup sales rise to 38,605 gallons. 1907 The Pepsi trademark is registered in Mexico. 1909 Automobile racing pioneer Barney Oldfield becomes Pepsi's first celebrity endorser when he appears in newspaper ads describing Pepsi-Cola as "A bully drink…refreshing, invigorating, a fine bracer for a race." The theme "Delicious and healthful" appears, and will be used intermittently over the next two decades.

1920 Pepsi appeals to consumers with "Drink Pepsi Cola. It will satisfy you." The price of sugar on the New York Stock Exchange reaches 26 cents per pound. Bradham gambles on the price going higher and buys large stocks of sugar. By the end of the year, sugar demand slows on the open market and the price drops to a catastrophic low of two t wo cents per pound.

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1923 Pepsi-Cola Company is declared bankrupt and its assets are sold to a North Carolina concern, Craven Holding Corporation, for $30,000. Roy C. Megargel, a Wall Wall Street Street broker broker,, buys buys the Pepsi Pepsi tradem trademark ark,, busine business ss and goodwi goodwill ll from from Craven Holding Corporation for $35,000, forming the Pepsi-Cola Corporation. 1932 The trademark is registered in Argentina. 1934 Peps Pepsii begi begins ns sell sellin ingg a 12-o 12-oun unce ce bottl bottle e for for five five cent cents, s, the the same same price price charged by its competitors for six ounces. 1939 A newspaper cartoon strip, "Pepsi & Pete," introduces the theme "Twice as much for a nickel" to increase consumer awareness of Pepsi's value advantage. 1940 Pepsi Pepsi makes makes advert advertisi ising ng histo history ry with with the first first advert advertisi ising ng jingle jingle ever ever broadcast nationwide. "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." "Nickel, Nickel" will eventually become a hit record and will be translated into 55 languages. languages. 1940 CEO Walter Mack adopts the standardized, embossed twelve-ounce bottle, which debuts with the "Pepsi-Cola" label blown and baked into the glass. A new logo, with more rounded script letters, is adopted. Mack sponsors a nationwide essa essayy cont contes estt whic which h ulti ultima mate tely ly lead leadss to the the hiri hiring ng of All Allen en McKe McKell llar ar and and Jeannette Maund, among the first African Americans hired in a professional capacity by a major U.S. corporation.

1941 In support of America's war effort, Pepsi changes the color of its bottle crowns to red, white and blue. A Pepsi canteen in Times Square, New York,

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operates throughout the war, enabling more than a million families to record messages for armed services personnel overseas.

1943 The "Twice as much" advertising strategy expands to include the theme "Bigger drink, better taste." 1946 World War II demands that sugar be rationed again. To counter the effects of rationing, Mack purchases a sugar plantation in Cuba, which proves to be a highly highly profitable profitable venture. Pepsi's theme line becomes "Bigger "Bigger Drink, Better Better Taste." Pepsi-Cola moves into Latin America. 1947 International International profits reach r each $6,769,000. $6,769,000. Pepsi moves into the Philippines and Middle East. 1948 Corpo Corpora rate te he head adqu quar arte ters rs move movess from from Long Long Isla Island nd City City,, Ne New w York York,, to midtown Manhattan. Manhattan.

1949 "Why take less when Pepsi's best?" is added to "Twice as much" advertising. Pepsi's theme line appeals to Pepsi lovers during hard times with "Why take less when Pepsi's best?" Former U.S. Secretary of Commerce, the late Ron Brown, becomes the first Africa African n America American n to appear appear in a nation national al consum consumer er campai campaign gn when when Pepsi Pepsi initiates a campaign targeting the African-American A frican-American market.

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Alfred N. Steele becomes President and Chief Executive Officer of PepsiCola. Mr. Steele's wife, Hollywood movie star Joan Crawford, is instrumental in promoting the company's product line. Pepsi-Cola's advertising keeps pace with cons consum umer er tast tastes es as Stee Steele le pion pionee eers rs the the prom promot otio ion n of Peps Pepsii-Co Cola la as an experience rather than a bargain. The "Twice as much for a nickel" slogan gives way as "More Bounce to the Ounce" takes Pepsi into the energetic decade. d ecade.

1953 Americans become more weight-conscious, and a new strategy based on Pepsi's Pepsi's lower lower calori caloricc conten contentt is implem implement ented ed with with "The "The Light Light Refre Refreshm shment ent"" campaign. 1954 "The Light Refreshment" evolves to incorporate "Refreshing Without Filling." 1956 A total of 149 Pepsi-Cola bottling plants operate in 61 countries outside the U.S. 1958 Some Someti time mess refe referr rred ed to as "the "the kitc kitche hen n cola cola," ," as a cons conseq eque uenc nce e of its its longtime positioning as a bargain brand, Pepsi now identifies itself with young, fashi fashion onabl able e consum consumers ers with with the "Be sociab sociable, le, have have a Pepsi" Pepsi" theme. theme. A distinctive "swirl" bottle replaces Pepsi's earlier straight-sided bottle 1959 Soviet Premier Nikita Khrushchev and U.S. Vice President Richard Nixon meet in the soon-to-be-famous "kitchen debate" at an international trade fair. The meeting, over Pepsi, is photo-captioned in the U.S. as "Khrushchev Gets Sociable."

1961 Peps Pepsii furt furthe herr refi refine ness its its targ target et audi audien ence ce,, reco recogn gniz izin ingg the the incr increa easi sing ng importance of the younger, post-war generation. "Now it's Pepsi, for those who think young" defines youth

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As a state of mind as much as a chronological age, maintaining the brand's appeal to all market segments. Harvey C. Russell joins Pepsi-Cola, becoming the first African American named a Vice President in a major U.S. corporation.

1962 Pepsi receives its new logo, the sixth in Pepsi history. The "serrated" bottle cap logo debuts, accompanying the brand's groundbreaking "Pepsi Generation" ad campaign. 1963 In one of the most significant demographic events in commercial history, the post-war baby boom emerges as a social and marketplace phenomenon. Pepsi recognizes the change, and positions Pepsi as the brand belonging to the new Generati Generation on – The Pepsi Genera Generatio tion. n. "Come "Come alive! alive! You're You're in the Pepsi Pepsi Gene Ge nera rati tion on"" make makess adve advert rtis isin ingg hist histor ory. y. It is the the firs firstt time time a produ product ct is identified, not so much by its attributes, as by its consumers' lifestyles.

1964 A new product, Diet Pepsi, is introduced into Pepsi-Cola advertising. 1965 Expansion outside the soft drink industry begins. Frito-Lay of Dallas, Texas, and Pepsi-Cola merge, forming PepsiCo, Inc. Military 12-ounce cans are such a success that full-scale commercial distribution begins. Mountain Dew launches its first campaign, "Ya-Hoo Mountain Dew…It'll tickle your innards." 1966 Diet Pepsi's first independent campaign, "Girl watchers," focuses on the cosmetic benefits of the low-calorie cola. The "Girl watchers" musical theme becomes a Top 40 hit. Advertising for another new product, Mountain Dew, a region regional al brand brand acquir acquired ed in 1964, 1964, airs for for the first first time, time, built built around around the instantly recognizable tag line, "Ya-Hoo, Mountain Dew!" 1967 When Wh en rese resear arch ch indi indica cate tess that that cons consum umer erss plac place e a prem premiu ium m on Peps Pepsi'i'ss superior taste when chilled, "Taste that beats the others cold. Pepsi pours it 7

Strategic Marketing

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on,” emphasizes emphasizes Pepsi's Pepsi's product product superiori superiority. ty. The campaign, campaign, while productproductorie orient nted ed,, adhe adhere ress clos closel elyy to the the en ener erge geti tic, c, yout youthf hful ul life lifest styl yle e imag imager eryy established in the initial Pepsi Generation campaign

1969 "You've got a lot to live. Pepsi's got a lot to give" marks a shift in Pepsi Generation advertising strategy. Youth and lifestyle are still the campaign's driving driving force forces, s, but with with "Live/ "Live/Giv Give, e,"" a new aware awarene ness ss and and a reflec reflectio tion n of contem contempor porary ary events events and and mood mood become become integ integral ral parts parts of the advert advertisi ising' ng's texture. 1972 Preliminary trade agreement is signed between the U.S.S.R. and PepsiCo, Inc.

1973 "Join the Pepsi people, feeling' free" captures the mood of a nation involved in massive social and political change. It pictures us the way we are – one people, but many personalities. Pepsi receives its new logo, the seventh in Pepsi history. The logo evolves into a boxed look with minor typeface changes occurring throughout throughout the next decade. The third Mountain Dew slogan, "Put A Little Ya-Hoo in Your Life," debuts. 1974 1974 First Pepsi plant opens opens in the U.S.S.R. U.S.S.R. Televisio Television n ads introduce introduce the new theme line HELLO SUNSHINE HELLO MOUNTAIN DEW

1975 The Pepsi Challenge, a landmark marketing strategy, convinces millions of consumers that that Pepsi's taste is superior. superior. Pepsi Light, with with a distinctive lemon taste, taste, introd introduce ucess an alterna alternative tive to tradit tradition ional al diet diet colas. colas. The The two-li two-liter ter Plastishield bottle is INTRODUCED

1976 "Have "Have a Pepsi Pepsi day" day" is the Pepsi Pepsi Genera Generatio tion's n's upbeat upbeat reflec reflectio tion n of an improving improving nationa nationall mood. "Puppies," "Puppies," a 30-seco 30-second nd snapshot snapshot of an encounte encounterr between a very small boy ven smaller puppies, becomes an instant commercial classic. 8

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1979 With the end of the '70s comes the end of a national malaise. Patriotism has been restored by an exuberant celebration of the U.S. bicentennial, and Americans are looking to the future with renewed optimism. "Catch that Pepsi spirit!" catches the mood and the Pepsi Generation carries it forward into the '80s.

1982 With With all the evidence evidence showin showingg that that Pepsi's Pepsi's taste taste is superi superior, or, the only only question remaining is how to add that message to Pepsi Generation advertising. The answer? "Pepsi's got your taste for life!" a triumphant celebration of great times and great taste. 1983 The soft drink market grows more competitive, but for Pepsi drinkers, the battle is won. The time is right and so is their soft drink. It's got to be "Pepsi Now!"

1984 A new generation has emerged – in the United States, around the world and in Pepsi advertising, too. "Pepsi. The Choice of a New Generation" announces the change, and the most popular entertainer of the time, Michael Jackson, stars in the first two commercials of the new campaign. The two spots quickly become "the most eagerly awaited advertising of all time". Lemon Lime Slice, the first major soft drink with real fruit juice, is introduced, creating a new soft 9

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drink category, "juice added." In a subsequent line of extensions, Mandarin Orange Slice goes on to become the number-one orange soft drink in the U.S. Diet Pepsi is reformulated with NutraSweet (aspartame) brand sweetener.

1985 Lio Lione nell Ritc Ritchi hie e lead leadss a star star--stud studde ded d para parade de into into "New "New Ge Gene nera rati tion on"" advertising followed by pop music icons Tina Turner and Gloria Estefan. Sports heroes Joe Montana and Dan Marino are part of it, as are film and television stars Teri Garr and Billy Crystal. Geraldine Ferraro, the first woman nominated to be vice president of the U.S., stars in a Diet Pepsi spot. And the irrepressible Michael J. Fox brings a special talent, style and spirit to a series of Pepsi and Diet Pepsi commercials, including a classic, "Apartment 10G". By the end of the year, the New Generation campaign earns more than 58 major advertising and film-related awards. Pepsi's campaign featuring Ritchie is the most remembered in the country, according to consumer preference polls. 1986 7-Up International International is acquired in Canada. "Dew It Country Cool" becomes the new slogan for Mountain Dew. Pepsi broadens Mountain Dew popularity with the introduction of Diet Mountain Dew. Mountain Dew is the sixth-largest brand in the industry, supporting double-digit growth annually for the past eight years.

1987 After an absence of 27 years, Pepsi returns to Times Square, New York, with a spectacular 850-square-foot electronic display billboard declaring Pepsi to be "America's Choice." 1988 Michael Jackson returns to "New Generation" advertising to star in a fourpart "episodic "episodic"" commercial commercial named "Chase." "Chase." "Chase" "Chase" airs during the Grammy Grammy Awards program and is immediately hailed by the media as "the most-watched commercial in advertising history."

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1989 "The Choice of a New Generation" theme expands to categorize Pepsi users as "A Generation Ahead!” In a widely praised initiative designed to help stem the severe dropout problem in U.S. high schools, Pepsi-Cola launches the pilot phase of a multi-milli multi-million-d on-dollar ollar program, the Pepsi School Challenge Challenge,, in innercity schools in Dallas and Detroit. Pepsi-Cola introduces an exciting new flavor, Wild Cherry Pepsi 1990 Teen Teen star starss Fred Fred Sava Savage ge and and Kirk Kirk Came Camero ron n join join the the "New "New Ge Gene nera rati tion on"" campaign, and football legend Joe Montana returns in a spot challenging other celebrities to taste-test their colas Against Pepsi. Music legend Ray Charles teams up with Uh-Huh Girls. The slogan for Diet Pepsi is modified to "You Got The Right One Baby, Uh-Huh." Craig E. Weather up is named CEO of Pepsi-Cola North America, as Canada becomes part of the company's North American operations. Pepsi-Cola unveils its new logo, the eighth in 93 years. To foster the earlier scripted logo's sense of movement, "Pepsi," now in italic capital typeface, is removed from a smaller blue and red Pepsi swirl and runs vertically up the package. The Pepsi School Challenge wins the U.S. Department of Labor "LIFT" Award for its efforts to improve education and academic achievement of students preparing for the workforce of tomorrow.

1991 "You got the right one baby" is modified to "You got the right one baby, uhhuh!" The "Uh-Huh Girls" join Ray Charles as backup singers and a campaign soon to become

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The most popular advertising in America is on its way. Supermodel Cindy Crawf Crawford ord stars stars in an award award-w -winn inning ing commer commercia ciall made made to introd introduce uce Pepsi' Pepsi'ss updated logo and package graphics.

1992 Celebrities join consumers, declaring that they "Gotta have it." The interim campaign supplants "Choice of a New Generation" as work proceeds on new Pepsi advertising for the '90s. Mountain Dew growth continues, supported by the antics of an outrageous new Dew Crew whose claim to fame is that, except for the unique great taste of Dew, they've "Been there, done that, tried that." Pepsi-Cola Company implements the "Right Side Up" philosophy, where the customer and frontline employees are at the top of the organization. Publisher Earl Graves and basketball superstar Earvin "Magic" Johnson are appointed Pepsi-Cola franchisees for the Washington, D.C. market. Their new company quickly becomes one of the largest African American-run companies in the U.S.

1993 "Be young, have fun, drink Pepsi" advertising starring basketball superstar Shaquille O'Neal is rated as best in U.S. 1994 New advertising introducing Diet Pepsi's freshness dating initiative features Pepsi CEO Craig Weatherup explaining the relationship between freshness and superior taste to consumers. 1995 In a new campaign, the company declares "Nothing else is a Pepsi" and takes top honors in the year's national advertising championship. Starbucks and Pepsi Pepsi team team up with with the the No North rth Amer Americ ican an Coff Coffee ee Part Partne ners rshi hip p and and laun launch ch Mazagran, a carbonated coffee drink. Pepsi enters the dairy beverage b everage category with Smooth Moos smoothies.

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1996 In February of this year, Pepsi makes history once again by launching one of the most ambitious entertainment sites on the World Wide Web. Pepsiworld eventually surpasses all expectations, and becomes one of the most launched and copied sites in this new medium, firmly establishing Pepsi's presence on the Internet. 1997 In the early part of the year, Pepsi pushes into a new era with the unveiling of the Ge Gener nerati atioNe oNext xt campai campaign. gn. Genera Generatio tioNex Nextt is about about everyt everythin hingg that that is young and fresh, a celebration of the creative spirit. It is about the kind of attitude that challenges the norm with new ideas, id eas, at every step of the t he way.

1998 Pepsi Pepsi conti continu nues es its popula popularr "Gener "Generati atioN oNext ext"" campai campaign gn with with spots spots that that include: Goose, Gnat and Stunt Driver (featuring racing superstar Jeff Gordon).

1998 (cont'd) In 1998 Pepsi launches its new look, called "Globe," which prominently featur features es a styliz stylized, ed, threethree-dim dimens ension ional. al. Pepsi Pepsi Globe Globe set again against st a blue blue ice 13

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backdrop. It affects all can, bottle, and multican packaging for Pepsi, Diet Pepsi, Caffeine Free Pepsi and Caffeine Free Diet Pepsi.

1999 "The Joy of Cola" new advertising campaign for Brand Pepsi features the voic voices es of acto actors rs Marl Marlon on Bran Brando do,, Isaa Isaacc Haye Hayess and and "Que "Queen en of Soul Soul"" Areth Aretha a Franklin. The spots also feature child actress Hallie Eisenberg as the "Little Girl."

1999 (cont'd) Pepsi and Lucasfilm team up again as "Star Wars: Episode I – The Phantom Menac Menace" e" hits hits movie movie theate theaters. rs. Consum Consumer er excite excitemen mentt surro surround undin ingg the longlongawaited return of the Star Wars series is heightened as special Pepsi bottles and cans offer 24 different Star Wars characters. The collection series includes a gold Yoda can.

1999 (cont'd) Pepsi recruits its first "spokesalien" Marfalump to star in its commercials supporting the campaign. Marfalump, who was created by BBDO and George Lucas' Industrial Light and Magic company, has two great passions: Pepsi and Star Wars. The spots, titled "Landing" and "Play Acting," illustrate the great lengths the young alien will go to enjoy both of his passions. Pepsi-Cola North America welcomes Gary Rodkin as President and CEO. The new look replaces Pepsi's current pedestal logo with a new brand identity that also more prominently features the Pepsi Globe against a blue background. Pepsi celebrates its centennial year with a birthday party that is attended by Pepsi-Cola bottlers from all over the world. Joining the festivities are Pepsi stars and friends including Ray Charles, Kool and the Gang and the Rolling Stones. President and Mrs. George Bush, Lady Thatcher and Walter 14

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Cronk Cronkite ite also also help help to commem commemora orate te the occasi occasion on where where Pepsi' Pepsi'ss legacy legacy is honored and a new look for the millennium is unveiled. The three-dimensional globe against an ice blue background becomes the universal symbol for one Pepsi family – poised for innovation and world leadership as it enters the new century.

2000 Faith Hill, Sammy Sosa and Ken Griffey Jr. - three of the hottest names in entert entertain ainme ment nt - signe signed d ne new w deals deals to endors endorse e Pepsi-C Pepsi-Cola ola produc products. ts. Singi Singing ng sensation Faith Hill, who has rocked the charts with her top 10 hits, stared in a new "Joy of Cola" ad with "Pepsi Girl" Hallie Eisenberg. The ad debuted during the March 26 Academy Awards broadcast. Major League Baseball All-Stars Sammy Sosa and Ken Griffey Jr. also stepped up to bat in new Pepsi commercials. In addition to the ads, each slugger was be involved in Pepsi's "Takin' it to the Fields" youth baseball and softball programs, as well as appeared on in-store promotional materials for the brand. From Boston to San Francisco and everywhere in between, consumers' cola choice is clear. In more than 30 markets currently conducting the Pepsi Challenge, the tastes of Pepsi and Pepsi ONE are preferred over Coke products in every market, especially in Philadelphia, Dayton, Tucson, San Antonio and Seattle. In a cross-promotion designed to further engage youth in our products, consum consumers ers who take take the Pepsi Pepsi Challe Challenge nge receiv receive e "start "starter er points points"" for for this this summer's "Choose Your Music" program.

2001 Pop superstar Britney Spears appears in her first Pepsi commercial during the 2001 Academy Awards. The high-energy spot also runs online, where more than 2 million fans click their way to Britney's own version of "The Joy of Pepsi."

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2001 (cont'd) Pepsi Pepsi Stuff Stuff.co .com m lets lets consum consumers ers redeem redeem points points from from specia specially lly marke marked d packages of Pepsi products for more than a half-million cool prizes, and proves to be Pepsi's most popular online promotion ever.

2001 (cont'd) Colombian singing sensation Shaker Shaker stars in a series of new commercials for Pepsi just as her debut English-language album hits stores in the U.S. At the same time, time, Pepsi agrees agrees to sponsor sponsor the Latin pop pop star's worldwide worldwide concert concert tour.

2001 (cont'd) Pepsi unveils its FunWraps Factory, letting consumers personalize Pepsi cans with fun designs and unique messages. With a wide variety of sports, entertainment and holiday images to choose from, Pepsi drinkers begin creating their own can labels for just about any occasion.

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2001 (cont'd) Pepsi puts "a little lit tle twist on a great thing," introducing lemon-flavored lemon-flavored Pepsi Twist and Diet Pepsi Twist. The product launch marks the return to lemonflavored colas for Pepsi, which distributed Pepsi Light until the mid-1980s.

Pepsi in Sports

Pepsi leadership has in their journey transformed PepsiCo into the premier cons consum umer er produ product ctss compa company ny,, by focu focusi sing ng on maki making ng this this the the very very best best convenient food and beverage enterprise in the world. The landmark merger with The Quaker Oats Company in August positions them to accelerate and sustain their future growth. The year was also outstanding because their entire family of businesses performed well despite the distractions that a big merger typically creates

PEPSICO HEADQUARTERS Peps PepsiC iCo o World rld Hea Headqu dquarter rterss is loca locate ted d in Purc urchase, ase, New York York,, approximately 45 minutes from New York City. C ity. The seven-building headquarters headquarters complex was designed by Edward Durrell Stone, one of America's foremost archit architect ects. s. The The buildbuild-din dingg occupi occupies es 10 acres acres of a 144144-acr acre e comple complexx that that includes the Donald M. Kendall Sculpture Gardens, a world acclaimed sculpture collection in a garden setting. The collection of works is focused on major twentieth century art, and features works by masters such as Auguste Rodin, Henri Laurens, Henry Moore, Alexander Calder, Alberto Giacometti, Arnaldo Pomodoro and Claes Oldenberg. The gardens were originally designed by the world famous garden planner, Russell Page, and have been extended by François Goffinet. The grounds are 17

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open to the public, and a visitor's booth is in operation during the spring and summer.

Frito-Lay North America and Frito-Lay International PepsiCo's snack food operations had their start in 1932 when two separate events took place. In San Antonio, Texas, Elmer Doolin bought the recipe for an unknown food product – a corn chip – and started an entirely new industry. The product was Fritos brand corn chips, and his firm became the Frito Company. That same year in Nashville, Tennessee, Herman W. Lay started his own busine business ss distrib distributi uting ng potato potato chips chips.. Mr. Lay Lay later later bough boughtt the compan companyy that that supplied him with product and changed its name to H.W. Lay Company. The Frito Company and H.W. Lay Company merged in 1961 to become Frito-Lay, Inc. Today, Frito-Lay brands account more than half of the U.S. snack chips industry. PepsiCo began its international snack food operations in 1966. Today, with operations in more than 40 countries, it is the leading multinational snack chip company, accounting for more than one quarter of international retail snack chip chip sales. sales. Produc Products ts are availa available ble in some some 120 120 countr countries ies.. FritoFrito-Lay Lay North North America includes Canada and the United States. Major Frito-Lay International markets include Australia, Brazil, Mexico, the Netherlands, South Africa, the United Kingdom and Spain. Often Frito-Lay products are known by local names. These names include Matuta Matutano no in Spain, Spain, Sabri Sabritas tas and and Gamesa Gamesa in Mexico Mexico,, Elma Elma Chips Chips in Brazil Brazil,, Walkers in the United Kingdom and others. The company markets Frito-Lay brands on a global level, and introduces unique products for local tastes. Major Frito-Lay products include Ruffles, Lay's and Doritos brands snack chips. Other major brands include Cheetos cheese flavored snacks, Tostitos tortilla chips, Santitas tortilla chips, Rold Gold pretzels and SunChips multigrain snacks snacks.. FritoFrito-Lay Lay also also sells sells a variet varietyy of snack snack dips dips and and cookie cookies, s, nu nuts ts and and crackers.

Pepsi-C Pepsi -Col ola a No Nort rth h Am Amer eric ica a an and d Pep Pepsi siCo Co Bev Bever erag ages es International PepsiCo's beverage business was founded at the turn of the century by Caleb Bradham, a New Bern, North Carolina druggist, who first formulated Pepsi-Cola. Today consumers spend about $33 billion on Pepsi-Cola beverages. Brand Pepsi and other Pepsi-Cola products – including Diet Pepsi, Pepsi-One, Mountain Dew, Slice, Sierra Mist and Mug brands – account for nearly one-third of total soft drink sales in the United States, a consumer market totaling about $60 billion. Pepsi-Cola Pepsi-Cola also offers offers a variety variety of non-ca non-carbona rbonated ted beverages, beverages, including including Aquafina bottled water, Fruitworks and All Sport. 18

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In 1992 Pepsi-Cola formed a partnership with Thomas J. Lipton Co. Today Lipton is the biggest selling ready-to-drink tea brand in the United States. Peps Pepsii-Co Cola la also also mark market etss Frapp rappuc ucci cino no read readyy-to-to-dr drin inkk coff coffee ee thro throug ugh h a partnership with Starbucks. In 2001 SoBe became a part of Pepsi-Cola. SoBe manufactures and markets an innovative line of beverages including fruit blends, energy drinks, dairybased drinks, exotic teas and other beverages with herbal ingredients. Outside Outside the United United States, States, Pepsi-Cola Pepsi-Cola soft drink operations operations include include the business of Seven-Up International. Pepsi-Cola beverages are available in about 160 countries and territories. PepsiPepsi-Col Cola a began began sellin sellingg its produc products ts intern internati ation onall allyy in 1934 1934 with with its operat operatio ions ns in Canada Canada.. Operat Operation ionss grew grew rapidl rapidlyy beginn beginning ing in the 1950 1950s. s. In additio addition n to brands brands market marketed ed in the Unite United d States States,, major major produc products ts includ include e Mirinda and Pepsi Max. Pepsi-Cola North America includes the United States and Canada. Canada. Key internati international onal markets markets include include Argentina Argentina,, Brazil, Brazil, China, China, India, India, Mexico, Philippines, Saudi Arabia, Spain, Thailand and the United Kingdom. PepsiCo Beverages International also produces, sells and distributes Gatorade sports drinks as well as Tropicana and other juices internationally. internationally. Pepsi-Cola provides advertising, marketing, sales and promotional support to Pepsi-Cola bottlers and food service customers. This includes some of the world' world'ss best-l best-love oved d and and most-r most-reco ecogni gnized zed adverti advertisin sing. g. New advert advertisi ising ng and and exciting promotions keep Pepsi-Cola brands young. The company manufactures and sells soft drink concentrate to Pepsi-Cola bottlers. The company also provides pr ovides fountain beverage beverage products.

Gatorade/Tropicana North America Tropicana was founded in 1947 by Anthony Rossi as a Florida fruit packaging business. The company entered the concentrate orange juice business in 1949, registering Tropicana as a trademark. In 1954 Rossi pioneered a pasteurization process for orange juice. For the first time, consumers could enjoy the fresh taste of pure not-from-concentrate 100% Florida orange juice in a ready-to-serve package. The juice, Tropicana Pure Premium, became the company's flagship product. In 1957 the name of the company was changed to Tropicana Products, headquartered in Bradenton, Florida. The company went public in 1957, was purchased by Beatrice Foods Co. in 1978, acquired by Kohlberg Kravis & Roberts in 1986 and sold to The Seagram Company Ltd. in 1988. Seagram purchased the Dole global juice business in 1995. PepsiCo acquired Tropicana, including the Dole juice business, in August 1998. Today the Tropicana brand is available in 63 countries. Principal brands in North America are Tropicana Pure Premium, Tropicana Season's Best, Dole Juic Juices es and and Trop Tropic ican ana a Twis Twiste ter. r. Inte Intern rnat atio iona nall lly, y, prin princi cipa pall bran brands ds incl includ ude e Tropic Tropican ana a Pure Pure Premiu Premium m and Dole Dole juice juicess along along with with Frui'V Frui'Vita ita,, Loóza Loóza and Copella. Tropicana Pure Premium is the third largest brand of all food products sold in grocery stores in the United States. 19

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Gatorade sports drinks was acquired by the Quaker Oats Company in 1983 and became a part of PepsiCo with the merger in 2001. Gatorade is the first isotonic sports drink. Created in 1965 by researchers at the University of Florida for the school's football team, "The Gators," Gatorade is now the world's leading sport's drink.

Quaker Foods North America The Quaker Oats Company was formed in 1901 when several American pioneers in oat milling came together to incorporate. In Ravenna, Ohio, Henry D. Seymour Seymour and William William Heston Heston had established established the Quaker Quaker Mill Company Company and registered the now famous trademark. Seymour wanted his product to be a symbol of honesty, integrity and strength. The figures of a man in Quaker clothes became the first registered trademark for breakfast cereal and remains the hallmark for Quaker Oats today. In Cedar Rapids, Iowa, John Stuart and his son, Robert, and their partner, George George Dougla Douglas, s, operat operated ed the large largest st cereal cereal mill mill of the time. time. Ferdin Ferdinan and d Schumacher, known known as "The Oatmeal King," had founded German Mills American Oatmeal Company in 1856. Combin Combining ing The Quaker Quaker Mill Mill Compan Companyy with with the Stuart Stuart and and Schuma Schumach cher er businesses brought brought together the top oats milling expertise in the country as The Quaker Oats Company. The first major acquisition of the company was Aunt Jemina Mills Company in 1926, which is today the leading manufacturer of pancake mixes and syrup. In 1986, The Quaker Oats Company acquired the Golden Grain Company, producers of Rice-A-Roni. PepsiCo merged with The Quaker Oats Company in 2001. Its products still have the eminence of wholesome, good-for-you food, as envisioned by the company over a century ago.

PepsiCo, Inc. Code of Conduct PepsiCo is committed to providing safe and healthy work environments and to being being an environment environmentally ally responsible responsible corporate citizen. citizen. It is their policy to compl complyy with with all all appli applica cable ble en envi viro ronm nmen enta tal, l, safe safety ty and and he heal alth thyy laws laws and and regulations. They are dedicated to designing, constructing, maintaining and operating facilities that protect their people and physical resources. They believe that protecting the environment is an important part of good corporate citizenship. They They are are comm committ itted ed to mini minimi mizi zing ng the the impa impact ct of thei theirr busi busine ness ss on the the environment with methods that are socially responsible, scientifically based and economically sound. They encourage conservation, recycling and energy use programs that promote clean air and water and reduce landfill waste.

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Great People The last competitive advantage of PepsiCo mentioned is less tangible, but every bit as fundamental to their success. It involves people and values. They believe that, as a company, they are defined by their relationships with their consumers — employees, partners and of course, their shareholders. Their destinies are very directly linked:  As they   grow, shareholders shareholders should grow grow as well. well. They are going to grow as long as Pepsi continues to attract, develop and retain world-class people. As part of this effort to have a world-class team, they strive to foster a diverse and inclusive work environment — one that allows all their employees to achieve professional professional grow growth th and and fulf fulfil illm lmen ent, t, with witho out rega regard rd to gend gender er,, ethn ethnic icit ityy or othe otherr differences. This Part of their executives' compensation is linked to the achievement of diversity goals — related to hiring, promotion and turnover turnover — within the context of each operating unit's Affirmative Action Plans. And, in fact, their divisions achieves all their diversity goals. With business partners, they try to engage in relationships that are mutually beneficial. They can achieve sustainable success only if their partners & their bottlers succeed alongside them. Their retail custom customers ers — from from the multi multinat nation ional al superm supermark arket et chain chain to the single single unit unit convenience store — should be able to earn a fair and reasonable profit selling their products, and they should provide them with the best opportunities for sales and profit growth. And their consumers, the people who eat and drink what they make, should get great quality and value every time they buy their brands. "Growth with Integrity" is an idea that binds them all together. They are focused and beautifully positioned to grow. And they continue to close in on their ultimate goal of being the world's very best consumer products company.

Social Aspects: DOES PEPSI DONATE TO CHARITY? Community involvement is important to Pepsi-Cola Company because their products touch the lives of so many people. That's why they make numerous inkind and monetary donations each year to support local and national charitable organizations.

DOES PEPSI SUPPORT THE ENVIRONMENT? Pepsi-Cola has a strong history of caring for the environment. Their goal is to have the least possible impact on the environment, and so far they have been very successful. Among their environmentally friendly initiatives are the "Please Recycle" message on each and every container that they make, and

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their contributions to a number of programs designed to stop littering and promote recycling. Pepsi-Cola is committed to being an environmentally responsible corporate citizen. In their offices, they use their resources wisely and actively recycle cans and paper. They not only strive to meet local and state environmental laws, but also try to exceed them by being industry innovators. In 1995 1995,, Peps Pepsii was was one one of only nly 20 comp compan anie iess hono honore red d by the the U.S. U.S. Environmental Protection Agency (EPA).

WHAT'S FRESHNESS DATING? At Pepsi-Cola, quality, taste and consumer satisfaction are their highest priorities. They take great care to ensure that Pepsi-Cola brands deliver the best taste available in soft drink refreshment. That's why since 1994, they have listed a freshness date on all of their packaging to ensure their loyal consumers can enjoy the best tasting beverages possible. While their products are never harmful when consumed after this date, they do recommend drinking the product by then to ensure its flavor is at its best. Also, by storing Pepsi in a cool place, great taste is guaranteed!

SHAREHOLDERS PepsiCo (symbol: PEP) shares are traded principally on the New York Stock Exchange Exchange in the United United States. States. The company company is also listed on the Amsterdam, Amsterdam, Chicago, Swiss and Tokyo stock exchanges. PepsiCo has consistently paid cash dividends since the corporation was founded.

Exceptional Innovation Capabilities Without question, innovation is the single greatest driver of growth for PepsiCo and their product categories. categories. After years years of making making innovation innovation a high priority, PepsiCo has experience and capabilities unrivaled in their industry. Frito-Lay has by far the world's greatest institutional knowledge of snacks and snac snackk cons consum umpti ption on.. Peps Pepsii-Co Cola la,, a long longti time me lead leader er in ne new w produ product ctss and and packaging, recently added the creative resources of SoBe. And the combination of the Gatorade Sports Science Institute and the Tropicana Nutrition Center give givess them them un unma matc tche hed d expe expert rtis ise e in the the grow growin ingg segm segmen entt of "fun "funct ctio iona nal" l" beverages that offer nutrition or other health benefits consumers value. The beauty of innovatio innovation n is the way it different differentiates iates their products products in the marketplace. New products and packages — or changes to existing ones — give consum consumers ers excitin excitingg new reaso reasons ns to buy their their brands brands.. Equall Equallyy importa important, nt, innovation gives retailers a great new reason to feature them prominently. That That's 's a big big comp compet etit itiv ive e adva advant ntag age. e. So they they grab grab ever everyy oppo opportu rtuni nity ty to differentiate their products through innovation. innovation. 22

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Different Differentiatio iation n also occurs occurs in manufact manufacturin uring. g. Frito-Lay Frito-Lay patented a new process to produce more intense flavors in its Ruffles Flavor Rush snacks by coat coatin ingg the the en enti tire re chip, chip, fron frontt and and back back.. For For Tost Tostit itos os Scoo Scoops ps,, Frit Fritoo-La Layy devel develop oped ed tech techno nolo logy gy to make make tort tortill illa a chip chips, s, typi typica cally lly flat flat,, in a thre threeedimensional spoonlike shape suited to scooping salsa or dip. Sounds easy. It's not. New, Ne w, more more conv conven enie ient nt pack packag ages es also also he help lp them them stan stand d out out from from the the competition. Tropicana's new 14-ounce plastic orange juice bottle is elegantly contoured to fit easily in the hand and the automobile cup holder. Similar thinking inspired Frito-Lay to create Go Snacks. These smaller versions of their traditional brands come in a plastic canister that also fits easily in hand and cup holder. On-the-go consumers can "pour" the snacks directly into their mouths. In one more example of innovative packaging, the Gatorade E.D.G.E. bottle is ergono ergonomic micall allyy desig designed ned for optima optimall thirst thirst quenc quenchin hing. g. In a busin business ess where where consumers demand great taste, innovative flavors also make their products distinctive. For example, Mountain Dew Code Red, a new version of Mountain Dew "with a rush of cherry flavor," hit the market in 2001 and became one of the most successful new soft drinks ever.

PEPSICO strategic business units

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Frito-Lay Brands Lay's potato chips Lay's Bistro Gourmet potato chips Lay's kettle cooked potato chips Wavy Lay's potato chips Baked Lay's potato crisps Maui Style potato chips Ruffles potato chips Baked Ruffles potato chips Ruffles Flavor Rush potato chips Doritos tortilla chips 3D's snacks Tostitos tortilla chips Baked Tostitos tortilla chips Santitas tortilla chips Fritos corn chips Cheetos cheese flavored snacks snacks Rold Gold pretzels pretzels Funyun Funyunss onion onion flavored flavored rings rings Sunchip Sunchipss multigrain multigrain snacks Cracker Jack candy coated popcorn Chester's popcorn Grandma's cookies Munchos potato crisps Smartfood popcorn Baken-ets fried pork skins Oberto meat snacks Frito-Lay dips & salsas Frito-Lay nuts Doritos, Cheetos & Chester's snack crackers Fritos, Tostitos & Doritos snack kits Outside the U.S. Bocabits wheat wheat snacks snacks Cruji Crujitos tos corn corn snack snackss Fanda Fandango ngoss corn corn snac snacks ks Hamka' Hamka's snack snackss Niknaks Niknaks cheese cheese sticks Quavers Quavers potato potato snacks Sabritas Sabritas potato potato chips Twisties Twisties cheese cheese snacks snacks Walkers Walkers potato potato crisps crisps Walkers Walkers Square Square potato snacks Walkers French French Fries Fries potato potato sticks sticks Walkers Walkers Monster Monster Munch Munch corn snacks Miss Vickie's Vickie's potato chips Munchies snack mix Gamesa cookies cookies Dippas Sonric's sweet sweet snacks snacks

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Pepsi-Cola Brands Pepsi-Cola Caffeine Free Pepsi Diet Pepsi Caffeine Free Diet Pepsi ONE Wild Cherry Pepsi, Pepsi Twist Mountain Dew Diet Mountain Dew Mountain Dew Code Red Red Mug Mug Sier Sierra ra Mist Mist Slic Slice e Lipt Lipton on Bris Briskk (Par (Partn tner ersh ship ip)) Lipt Lipton on Iced Iced Tea Tea (Partn (Partners ershi hip) p) Dole Dole juice juice drink drinkss FruitW FruitWork orkss juice juice drink drinkss Aquaf Aquafina ina purifi purified ed drinking water Frappuccino coffee beverages (Partnership) SoBe juice drinks and teas AMP Outside the U.S. Mirinda 7UP Pepsi Max Kas Teem Pepsi Limón Pepsi Light

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Gatorade Brands Gatorade thirst quencher Gatorade Frost thirst quencher Gatorade Fierce thirst quencher Gatorade Ice thirst quencher Gatorade energy bar Propel fitness water

Tropicana Brands Tropicana Pure Premium Tropicana Season's Best juices Tropicana Twister juice juice drinks drinks Tropicana Tropicana Smoothies Smoothies Tropicana Tropicana Pure Tropics Tropics juices juices Dole juices juices Loóza juice juicess and and nectar nectarss Copella Copella juice juicess Frui'V Frui'Vita ita juice juicess Outsid Out side e the U.S U.S.. Loóza Tropicana 100 juices Alvalle Gazpacho

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Quaker Brands Quaker Oatmeal Quaker instant oatmeal Cap'n Crunch cereal Life cereal Quaker Toasted Oatmeal cereal Quaker 100% Natural cereal Quaker Squares cereal Quisp cereal King Vitaman cereal Quaker Bagged cereals Quaker Oh's! Cereal Mother's cereal Quaker rice cakes Quaker Quakes rice snacks Quaker Chewy granola bars Quaker Fruit & Oatmeal bars Rice-A-Roni side dishes Pasta Roni side dishes Near East couscous/pilafs Aunt Jemima mixes & syrups Quaker grits Outside the U.S. FrescAvena beverage powder Toddy chocolate powder Toddyn Toddynho ho chocol chocolate ate drink drink Coquei Coqueiro ro canne canned d fish fish Sugar Sugar Puffs Puffs cereal cereal Harves Harvestt Crunch cereal Cruesli cereal Quaker Oatso Simple hot cereal Scott's Porage Oats Quaker Snack-a-Jacks Snack-a-Jacks rice cakes Quaker Dipps granola bars

Water World - the battle for a global brand The world's drinks giants Coca Cola and Pepsi are among the world's most recognised brand names. As the popularity of bottled mineral water continues to reach new highs and take share from these carbonates, questions of the first truly global water brand are beginning to surface. Among those best placed are Europe's big players. Can Evian, Volvic or Perrier create the Coke & Pepsi of the water world?

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Current Corporate Strategy: Growth and Integrity The 2001 results show that people across this company recognize that the single biggest reason for the merger is growth. Growth, after all, is what Pepsi PepsiCo Co is abou about. t. It alwa always ys has has been been.. Grow Growth th is impo importa rtant nt.. But But equa equall llyy important is how they get there. Growth and integrity have gone together at Pepsi for as long as their existence. And they will do everything in their power to ensure that continues. In fact, they literally designed PepsiCo so they can fulf fulfil illl thei theirr ambi ambiti tion onss for for grow growth th with witho out ever ever havi having ng to cut cut corn corner ers, s, compro compromis mise e their their integr integrity ity or otherw otherwise ise violat violate e the sacred sacred trust trust placed placed in PepsiCo by their shareholders, their employees and so many others.

Built to Grow It starts with a laser focus on "convenience." Convenient, easy-to-consume products are the fastest-growing part of the global food and beverage industry. Around the world, people are spending hundreds of billions of dollars each year on foods and drinks that fit their busy lifestyles. And they're spending more each year. It's a vast opportunity. opp ortunity. It's also an area they know very well. They have been making and selling convenient products for decades. In that time they have become the leader in convenient foods and drinks in the United States and the world they compete in. Far more exciting, they are better equipped than any other company for continued success in this big, expanding worldwide market.

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Product Portfolio: HOW DO they MAKE PEPSI? Actually, there's no secret to how to make Pepsi (except for the recipe). But there is a system. And that system, plus a lot of hard work, is what enables Pepsi-Cola and the independent Pepsi-Cola bottlers all around the world to bring the consumes that high-quality, consistently refreshing Pepsi taste each time they open one of pepsi's products. The system starts with the finest ingredients available -- kola nuts, vanilla beans, flavor oils, citrus, sweeteners and the purest waters we can d istill. Then they add the best technology and all the care we can muster to blend their ingredients. And during the 100-plus years they have been making soft drinks, they have also created their own exacting production and quality standards, monitored with constant testing to guarantee quality and consistency in their products. Finally, they have their own local distribution system. It's designed to make sure that the Pepsi consumers open at home is as fresh and delicious as it was when they sealed it at their plant. And it serves every city and town in the world.

QUALITY At every level of Pepsi-Cola Company, they take great care to ensure that the the high highes estt stan standa dard rdss are are met met in ever everyt ythi hing ng they they do. do. In thei theirr produ product cts, s, packaging, marketing and advertising, they strive for excellence because their consum consumers ers expect expect and deserv deserve e nothi nothing ng less. less. They They promis promise e to work work toward toward continuous improvement in all areas of their organization. At every step of their manufacturing and bottling process, strict quality controls are followed to ensure that Pepsi-Cola products meet the same high standards of quality that consumers have come to expect and value from them. They also follow strict quality control procedures during the manufacturing and filling of their packages. Each bottle and can undergoes a thorough inspection and testing process. Containers are then rinsed and quickly filled through a high-speed, state-of-the-art process that helps prevent any foreign material from entering the product. Additional quality control measures help to ensure the integrity of Pepsi-Cola products throughout the distribution process, from warehouse to store shelf.

WHAT INGREDIENTS ARE IN PEPSI PRODUCTS? They They only only use the finest finest ingred ingredien ients ts to make make PepsiPepsi-Col Cola a produc products. ts. To guarantee their consumers consistent quality, each ingredient must pass Pepsi29

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Cola Cola's 's high high stan standa dard rds, s, rigo rigoro rous us qual quality ity cont contro roll test testss and and stri strict ct bottl bottlin ingg procedures. All ingredients are listed on the label in order of decreasing amount. PepsiCola products contain natural flavors, including extracts of the kola nut, vanilla beans and flavor oils derived from natural sources such as citrus and other fruits. Caramel (made from corn sugar) adds color and flavor to our colas. Their ingredients add a refreshing taste: phosphoric acid in colas; citric acid and sodium citrate in Mountain Dew, Slice and Diet Pepsi. They also put a freshness date on every can and bottle. Soft drinks may lose some flavor over time so their freshness date tells consumers when the product is freshest and best tasting. Every can and bottle of Pepsi-Cola products has a Nutrition Facts panel, which shows the number of calories and other nutrients per serving. There is essentially no fat in any Pepsi-Cola products. The main ingredients found in Pepsi-Cola products include carbonated water, carbohydrates, sugar, sodium, potassium and caffeine . For a complete breakdown by ingredients by product, Pepsi, Diet Pepsi, Pepsi ONE, Mountain Dew, Slice, Mug Root Beer, Aquafina or FruitWorks is recommended. .  Aspartame: Aspartame is a sugar substitute used in their diet beverages and many other food products. Aspartame is made of the same building blocks as protei protein, n, so it is consi considere dered d a "nutr "nutriti itive ve sweete sweetener ner," ," but the very very small small amounts used in diet drinks contribute no calories.  Acesulfame-K:  Acesulfame- K: Acesulfame-K (or "Ace-K") is a non-nutritive, calorie-free sweetener. A blend of Acesulfame Potassium and Nutrasweet is used to provide taste and sweetness to Pepsi ONE. Sodium: All of their products are "low sodium" and contain less than 110 mg per eight-fluid- ounce serving. A number of beverages have less than 35 mg sodium per serving, so they are considered "very low sodium" products. Potassium: Potassium in Pepsi-Cola products may come from water or as part of certain ingredients. For example, potassium may be combined with benzoic acid, which helps prevent spoilage and flavor changes. Potassium is an electrolyte that helps meet the t he mineral needs of active people. Caffeine: Caffeine provides a characteristic flavor to soft drinks. Caffeine is naturally found in coffee, tea and chocolate. There is no caffeine in CaffeineFree Pepsi, Caffeine-Free Diet Pepsi, Fruitworks, Aquafina, Slice, MUG Root Beer/Cream Soda, Sierra Mist or Caffeine-Free Mountain Dew.

Pepsi Product Caffeine Content (per 8 fl. oz.)

Pepsi The choice for great cola taste. • Pepsi-Cola25 • Caff Caffei eine ne-f -fre ree e Pep Pepsi si0 0 30

Strategic Marketing

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• Diet Diet Peps Pepsii-Co Cola la2 24 • Caff Caffei eine ne-f -fre ree e Diet Diet Peps Pepsi0 i0 • Wi Wild ld Cher Cherry ry Peps Pepsi2 i25 5 • Diet Diet Wi Wild ld Cher Cherry ry Peps Pepsi2 i24 4 • Pepsi ONE37 • Pepsi Tw Twist25 • Diet Diet Peps Pepsii Twist wist2 24 Mountain Dew37 • Caff Caffei eine ne-f -fre ree e Mou Mount ntai ain n Dew0 Dew0 • Die Diet Mo Moun unta tain in Dew3 Dew37 7 • Caff Caffei eine ne-f -fre ree e Diet Diet Mount Mountai ain n Dew0 Dew0

Mug Root Beer0 • Die Diet Mug Mug Root oot Be Beer0 er0 • Mug Cream Soda0 • Die Diet Mug Mug Cream ream Soda oda0

Orange Slice0 • • • • • •

Die Diet Ora Oran nge Slic Slice0 e0 Lem Le mon-L n-Lime ime Slic Slice0 e0 Fruit ruit Pun Punch Sli Slice ce0 0 Pineapple ple Sl Slice0 Stra Straw wberr berryy Slic Slice0 e0 Peach Sl Slice0

Sierra Mist0 • Aquafina0 • Frui Fruitw twor orks ks (all (all flav flavor ors) s) 0 • Lipton Brisk6

Pepsi ONE (8 fl. oz) Contains: Carbonated water, caramel color, natural and artificial flavors, phosphoric acid, aspartame, citric acid, sodium benzoate (preserves freshness), caffeine and acesulfame potassium. • Calories1 • Total Fats (g) 0 • Sodium (mg) 30 31

Strategic Marketing

• • • • •

Pepsi Cola

Pota Potass ssiium (mg) mg) 20 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (m (mg) 37 37

PEPSI TWIST New Pepsi Twist is a refreshing alternative to the usual cola. It's got the same great taste of Pepsi, but they have added a twist of lemon for an unexpected zing – a little twist on a great thing.

Pepsi Twist (8 fl. oz) Cont Contai ains ns:: Carbo Carbona nate ted d water water,, high high fruc fructo tose se corn corn syru syrup p and/ and/or or suga sugar, r, carame caramell color, color, phosph phosphori oricc acid, acid, potass potassium ium citrat citrate, e, caffei caffeine, ne, citric citric acid, acid, potassium potassium benzoate benzoate (preserve (preservess freshne freshness), ss), ascorbic ascorbic acid, acid, calcium calcium disodium disodium EDTA (to protect flavor) and natural flavors. • • • • • • • • • •

% Juice0 Calories100 Total Fats (g) 0 Sodium (mg) 25 Sodium (% (%DV)1 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 28 Tota Totall Car Carbo bohy hydr drat ates es (%DV (%DV)) 9 Sugars (g) 27 Protein (g) 0 Caffeine (m (mg) 25 25

Diet Pepsi Twist (8 fl. oz)

Contains: Carbonated water, caramel color, aspartame, phosphoric acid,  potassium benzoate (preserves freshness), freshness), caffeine, caffeine, citric acid and natural natural flavors. • • • • • • • • • •

% Juice0 Calories0 Total Fats (g) 0 Sodium (mg) 25 Sodium (%DV) 1 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Tota Totall Car Carbo bohy hydr drat ates es (%DV (%DV)) 0 Sugars (g) 0 Protein (g) 0 Caffeine (m (mg) 24 24

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SIERRA MIST Sierra Mist (8 fl. oz)

Conta Contain ins: s: Carbon Carbonat ated ed water, water, high high fruc fructos tosee corn corn syru syrup p and/o and/orr suga sugar, r, natura naturall flav flavor ors, s, citr citric ic acid, acid, potass potassiu ium m benzoa benzoate te (prese (preserv rves es fresh freshne ness) ss),,  potassium citrate, ascorbic ascorbic acid, calcium calcium disodium disodium EDTA (to (to protect flavor). flavor). • • • • • • • •

Calories100 Total Fats (g) 0 Sodium (mg) 25 Potas tassium (m (mg) 0 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 26 Sugars (g) 26 Protein (g) 0 Caffeine (mg) 0

DIET SIERRA MIST • • • • • • • •

Diet Diet Sie Sierr rra a Mis Mistt (8 (8 fl. fl. oz) oz) Calories0 Total Fats (g) 0 Sodium (mg) 25 Tota Totall Carbo Carbohy hydr drat ates es (g)< (g)<1 1 Sugars (g) 1 Protein (g) 0 Caffeine (mg) 0

SLICE Bolder, better and caffeine free! Other Slice flavors include: Diet Orange, Lemon-Lime, Diet Lemon-Lime, Fruit Punch, Pineapple, and Strawberry, Dr. Slice and Slice Red .

Orange Slice (8 fl. oz) Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, potassium citrate, potassium benzoate (preserves freshness), gum arabic, malic acid, potassium sorbate (preserves freshness), yellow 6, salt, ester gum, natural natural flavors, calcium calcium disodium disodium EDTA (to protect protect flavor) flavor) and brominated brominated vegetable oil. • Calories130 • Total Fats (g) 0 • Sodium (mg) 35 33

Strategic Marketing

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Pepsi Cola

Pota Potass ssiium (mg) mg) 70 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 34 Sugars (g) 33 Protein (g) 0 Caffeine (mg) 0

Diet Orange Slice (8 fl. oz) Contains Contains:: Carbonate Carbonated d water, water, citric acid, acid, aspartame aspartame,, potassium potassium citrate, citrate, potassium benzoate (preserves freshness), citrus pectin, gum arabic, yellow 6, salt, malic acid, glycerol ester of wood rosin, natural flavors, calcium disodium EDTA (to protect flavor) and brominated vegetable oil. • • • • • • • •

Calories0 Total Fats (g) 0 Sodium (mg) 35 Pota Potass ssiium (mg) mg) 60 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 1 Sugars (g) 0 Protein (g) 0 Caffeine (mg) 0

Fruit Punch Slice (8 fl. oz) Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, acid, potass potassium ium benzoa benzoate te (prese (preserve rvess freshn freshness ess), ), gum gum arabic arabic,, salt, salt, red 40, 40, potassium sulfate, glycerol ester of wood rosin, calcium disodium EDTA (to protect flavor) and natural and artificial flavors. • • • • • • • •

Calories120 Total Fats (g) 0 Sodium (mg) 35 Pota Potass ssiium (mg) mg) 28 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 34 Sugars (g) 32 Protein (g) 0 Caffeine (mg) 0

Strawberry Slice (8 fl. oz) Contains: Carbonated water, high fructose corn syrup and/or sugar, natural and artificia artificiall flavors, flavors, citric citric acid, potassium potassium benzoate benzoate (preserve (preservess freshne freshness), ss), salt, red 40, potassium sulfate and calcium disodium EDTA (to protect flavor). • Calories120 • Total Fats (g) 0 • Sodium (mg) 35 34

Strategic Marketing

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Pepsi Cola

Pota Potass ssiium (mg) mg) 27 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 31 Sugars (g) 31 Protein (g) 0 Caffeine (mg) 0

Cherry Lime Slice (8 fl. oz) Contains: High fructose corn syrup and/or sugar, treated water, natural and artifi artificia ciall flavor flavors, s, citric citric acid, acid, sodium sodium benzoa benzoate te (prese (preserve rvess fresh freshnes ness) s),, gum arabic, red 40 and caramel color. • • • • • • • •

Calories110 Total Fats (g) 0 Sodium (mg) 30 Potassium (m (mg) 0 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 29 Sugars (g) 28 Protein (g) 0 Caffeine (mg) 0

Pineapple Slice (8 fl. oz) Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, potassium benzoate (preserves freshness), gum arabic, salt, potassium sulfate, natural and artificial flavors, glycerol ester of wood rosin, calcium disodium EDTA (to protect flavor), yellow 5 and yellow 6. •

FRAPPUCCINO The taste that makes the break. Starbucks Frappuccino® Coffee Drinks are distributed through the North American Coffee Partnership (NACP), a joint venture between Pepsi-Cola North America and Starbucks. Bottled Frappuccino drinks are the creamy, cold, delicious coffee drinks that allow you to have a Starbucks moment anytime, anywhere. They come in severa severall indulg indulgen entt flavo flavors: rs: Coffee Coffee,, Mocha, Mocha, Vanill Vanilla, a, Mocha Mocha Light Light and Mocha Mocha Amaretto. They are available in single serve, four-packs, and 12-packs. FRUITWORKS FruitW FruitWork orkss is fortif fortified ied with with 100% 100% of the RDI (U.S. (U.S. Recomm Recommend ended ed Daily Daily Intake) of Vitamin C and 20% of selected B Vitamins. There are currently five exci excitin tingg frui fruitt blen blends ds avai availa labl ble e --Appl Apple e Rasp Raspbe berr rry, y, Peac Peach h Papa Papaya ya,, Pink Pink 35

Strategic Marketing

Pepsi Cola

all of whic which h are are Lemonade, Lemonade, Strawber Strawberry ry Melon, Melon, and Tangerine Tangerine Citrus Citrus -- all carbonation and caffeine free. Apple Raspberry (8 fl. oz) Cont Contai ains ns:: Wate Water, r, high high fruc fructo tose se corn corn syru syrup, p, filte filtere red d pear pear juic juice e from from concentrate, malic acid, natural flavors, phosphoric acid, ascorbic acid (vitamin C), C), sodi sodium um poly polyph phos osph phat ates es,, pota potass ssiu ium m benz benzoa oate te and and pota potass ssiu ium m sorb sorbat ate e (preserves freshness), citric acid, xanthan gum, red 40, calcium disodium EDTA (to protect flavor), B vitamins (niacin, pantothenic acid and vitamin B6), and blue 1. • Calories100 • Total Fa Fat (g (g) 0 • Sodium (mg) 70 • Pota Potass ssiium (mg) mg) 25 • Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 28 • Sugars (g) 25 • Protein (g) 0 • Caffeine (mg) 0

Peach Papaya (8 fl. oz) Cont Contai ains ns:: Wate Water, r, high high fruc fructo tose se corn corn syru syrup, p, filte filtere red d pear pear juic juice e from from concentrate, citric acid, phosphoric acid, ascorbic acid (vitamin C), sodium polyphosphates, natural flavors, potassium benzoate (preserves freshness), gum arabic, arabic, potassium potassium citrate, citrate, potassium potassium sorbate sorbate (preserves (preserves freshne freshness), ss), xanthan xanthan gum, ester gum, calcium disodium EDTA (to protect flavor), B vitamins (niacin, pantothenic acid and vitamin B6), yellow 6 and red 40. • Calories110 • Total Fa Fat (g (g) 0 • Sodium (mg) 70 • Pota Potass ssiium (mg) mg) 40 • Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 30 • Sugars (g) 28 • Protein (g) 0 • Caffeine (mg) 0 Pink Lemonade (8 fl. oz) Contains: Water, high fructose corn syrup, citric acid, clarified lemon juice from from conc concen entr trat ate, e, natu natura rall flav flavor ors, s, ascor scorbi bicc acid acid (vit (vitam amin in C), C), sodi sodium um polyphosphates, potassium citrate, potassium benzoate (preserves freshness), gum arabic arabic,, potass potassium ium sorbat sorbate e (prese (preserve rvess fresh freshnes ness) s),, ester ester gum, gum, calciu calcium m disodium EDTA (to protect flavor), B vitamins (niacin, pantothenic acid and vitamin B6), and red 40. • Calories110 • Total Fa Fat (g (g) 0 • Sodium (mg) 50 • Pota Potass ssiium (mg) mg) 55 • Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 30 36

Strategic Marketing

Pepsi Cola

• Sugars (g) 29 • Protein (g) 0 • Caffeine (mg) 0

Strawberry Melon (8 fl. oz) Cont Contai ains ns:: Wate Water, r, high high fruc fructo tose se corn corn syru syrup, p, filte filtere red d pear pear juic juice e from from concentrate, citric acid, phosphoric acid, potassium citrate, natural flavors, asco ascorbi rbicc acid acid (vit (vitam amin in C), C), sodiu sodium m poly polyph phos osph phat ates es,, pota potass ssiu ium m benz benzoa oate te (preserve (preservess freshne freshness), ss), gum arabic, arabic, potassium potassium sorbate sorbate (preserves (preserves freshne freshness), ss), xanthan gum, ester gum, calcium disodium EDTA (to protect flavor), B vitamins (niacin, pantotheic pantotheic acid and vitamin B6), red 40 and blue 1. • • • • • • • •

Calories110 Total Fa Fat (g (g) 0 Sodium (mg) 70 Pota Potass ssiium (mg) mg) 70 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 30 Sugars (g) 25 Protein (g) 0 Caffeine (mg) 0

Tangerine Citrus (8 fl. oz) Cont Contai ains ns:: Wate Water, r, high high fruc fructo tose se corn corn syru syrup, p, filte filtere red d pear pear juic juice e from from concentrat concentrate, e, citric acid, natural natural flavors, flavors, ascorbic ascorbic acid (vitamin (vitamin C), sodium sodium polyphospha polyphosphates, tes, phosphori phosphoricc acid, potassium potassium benzoate benzoate (preserve (preservess freshne freshness), ss), gum arabic, potassium sorbate (preserves freshness), xanthan gum, ester gum, calcium disodium EDTA (to protect flavor), B vitamins (niacin, pantothenic acid and vitamin B6), yellow 5 and red 40. • • • • • • • •

Calories100 Total Fa Fat (g (g) 0 Sodium (mg) 50 Pota Potass ssiium (mg) mg) 25 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 28 Sugars (g) 25 Protein (g) 0 Caffeine (mg) 0

Regular Pepsi (8 fl. oz) Cont Contai ains ns:: Carbo Carbona nate ted d water water,, high high fruc fructo tose se corn corn syru syrup p and/ and/or or suga sugar, r, caramel color, phosphoric acid, caffeine, citric acid and natural flavors. • • • •

Calories100 Total Fa Fat (g (g) 0 Sodium (mg) 25 Pota Potass ssiium (mg) mg) 10 37

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Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 27 Sugars (g) 27 Protein (g) 0 Caffeine (m (mg) 25 25

Regular Caffeine-Free Pepsi (8 fl. oz) Cont Contai ains ns:: Carbo Carbona nate ted d water water,, high high fruc fructo tose se corn corn syru syrup p and/ and/or or suga sugar, r, caramel color, phosphoric acid, citric acid and natural flavors. • Calories100 • Total Fa Fat (g (g) 0 • Sodium (mg) 25 • Pota Potass ssiium (mg) mg) 10 • Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 27 • Sugars (g) 27 • Protein (g) 0 • Caffeine (mg) 0 Diet Pepsi (8 fl. oz) Contains: Carbonated water, caramel color, aspartame, phosphoric acid, potassium potassium benzoate benzoate (preserve (preservess freshnes freshness), s), caffeine, caffeine, citric citric acid and natural natural flavors. • • • • • • • •

Calories0 Total Fa Fat (g (g) 0 Sodium (mg) 25 Pota Potass ssiium (mg) mg) 20 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (m (mg) 24 24

Diet Caffeine-Free Pepsi (8 fl. oz) Contains: Carbonated water, caramel color, aspartame, phosphoric acid, potassium benzoate (preserves freshness), citric acid and natural flavors. • • • • • • • •

Calories0 Total Fa Fat (g (g) 0 Sodium (mg) 25 Pota Potass ssiium (mg) mg) 20 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (mg) 0

Wild Cherry Pepsi (8 fl. oz)

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Cont Contai ains ns:: Carbo Carbona nate ted d water water,, high high fruc fructo tose se corn corn syru syrup p and/ and/or or suga sugar, r, caramel color, phosphoric acid, natural flavors, caffeine, caffeine, and citric acid. • • • • • • • •

Calories110 Total Fa Fat (g (g) 0 Sodium (mg) 25 Potassium (m (mg) 5 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 29 Sugars (g) 29 Protein (g) 0 Caffeine (m (mg) 25 25

Diet Wild Cherry Pepsi (8 fl. oz) Contains: Carbonated water, caramel color, phosphoric acid, aspartame, potassium potassium benzoate benzoate (preserve (preservess freshne freshness), ss), gum arabic, arabic, natural natural flavors flavors and caffeine. • • • • • • • •

Calories0 Total Fa Fat (g (g) 0 Sodium (mg) 25 Pota Potass ssiium (mg) mg) 18 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (m (mg) 24 24

LIPTON BRISK ICED TEA AND LIPTON ICED TEA: TEA: Lipton's Iced Tea Lipton's Ice Tea is the real deal. For self-assured, energetic tastes. The Pepsi Lipton Tea Partnership is a joint venture between Pepsi-Cola Comp Compan anyy and and Lipt Lipton on,, base based d in Engl Englew ewoo ood, d, Clif Cliffs fs,, and and Ne New w Jers Jersey ey.. The The partnershi partnership p produces, produces, markets markets and distributes distributes ready-to-d ready-to-drink rink Lipton Lipton BRISK, BRISK, Lipton Iced Tea and Lipton BRISK Fountain Iced Tea. LIPTON BRISK

It's bold, it's confident, it's Lipton BRISK. BRISK is available in four bold flavors: Lemon, Diet Lemon, Raspberry and Sweet Tea and is available in 20ounce, one-liter and two-liter bottles, convenient 12-pack and 24-pack cans and on the fountain.

Lipton Brisk Lemon Flavored (8 fl. oz) 39

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Contai Contains: ns: Water Water,, High High Fructo Fructose se Corn Corn Syrup Syrup and/o and/orr Sugar, Sugar, Citric Citric Acid, Acid, Instant Tea, Sodium Polyphosphates, Natural Flavors, Phosphoric Acid, Sodium Benzoate and Potassium Sorbate (Preserves Freshness), Caramel Color, Calcium Disodium EDTA (To Protect Flavor) and Red 40. • • • • • • •

Calories80 Total Fa Fat (g (g) 0 Sodium (mg) 65 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 23 Sugars (g) 22 Protein (g) 0 Caffeine (mg) 6

Lipton Brisk Raspberry (8 fl. oz) Contains: Water, High Fructose Corn Syrup and/or Sugar, Natural Flavors, Citric Acid, Instant Tea, Phosphoric Acid, Sodium Polyphosphates, Potassium Sorbate and Potassium Benzoate (Preserves Freshness), Caramel Color, Calcium Disodium EDTA (To Protect Flavor) and Red 40. • • • • • • •

Calories90 Total Fa Fat (g (g) 0 Sodium (mg) 50 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 24 Sugars (g) 23 Protein (g) 0 Caffeine (mg) 7

Lipton Brisk Tea – Sweetened No Lemon (8 fl. oz) Contains: Water, High Fructose Corn Syrup and/or Sugar, Phosphoric Acid, Natural Flavors, Instant Tea, Sodium Polyphosphates, Potassium Sorbate and Potassium Benzoate (Preserves Freshness), Caramel Color, Citric Acid, Calcium Disodium EDTA (To Protect Flavor) and Red 40. • • • • • • •

Calories70 Total Fa Fat (g (g) 0 Sodium (mg) 50 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 18 Sugars (g) 18 Protein (g) 0 Caffeine (mg) 5

Diet Lipton Brisk Lemon Flavored (8 fl. oz) Cont Contai ains ns:: Water Water,, Citr Citric ic Acid, Acid, Inst Instan antt Tea, Tea, Natu Natura rall Flav Flavor ors, s, Sodiu Sodium m Polyphospha Polyphosphates, tes, Caramel Caramel Color, Color, Potassium Potassium Sorbate Sorbate and Potassium Potassium Benzoate Benzoate (Prese (Preserve rvess Fresh Freshnes ness) s),, Asparta Aspartame, me, Citrus Citrus Pectin Pectin,, Acesulf Acesulfame ame Potass Potassium ium,, Calcium Disodium EDTA (To Protect Flavor) and Red 40. 40

Strategic Marketing

Pepsi Cola

• Calories0 • Total Fa Fat (g (g) 0 • Sodium (mg) 50 • Tota Totall Carbo Carbohy hydr drat ates es (g)< (g)<1 1 • Sugars (g) 0 • Protein (g) 0 • Caffeine (mg) 7 Mirinda Orange (8 fl. oz)

Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, potassium benzoate (preserves freshness), purity gum, yellow 6, natural flavor, ester gum, ascorbic acid (to protect flavor) and sodium citrate. • • • • • •

Calories110 Total Fa Fat (g (g) 0 Sodium (mg) 25 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 31 Sugars (g) 31 Protein (g) 0

Mirinda Red (8 fl. oz)

Contai Contains: ns: Carbon Carbonate ated d water water,, high high fructo fructose se corn corn syrup syrup and/or and/or sugar, natural and artificial flavor, citric acid, potassium benzoate (pre (prese serv rves es fres freshn hnes ess) s),, salt salt,, red red 40, 40, calc calciu ium m diso disodi dium um EDTA EDTA (to (to protect flavor). • • • • • •

Calories140 Total Fat (g) 0 Sodium (mg) 45 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 38 38 Sugars (g) 38 Protein (g) 0

Mirinda Fruit Punch (8 fl. oz)

Contai Contains: ns: Carbon Carbonate ated d water water,, high high fructo fructose se corn corn syrup syrup and/or and/or sugar, citric acid, potassium benzoate (preserves freshness), gum arabic, salt, red 40, potassium sulfate, natural and artificial flavors, ester gum and calcium disodium EDTA (to protect flavor). 41

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Calories120 Total Fat (g) 0 Sodium (mg) 35 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 34 34 Sugars (g) 32 Protein (g) 0

Mirinda Grape (8 fl. oz) Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, artificial flavors, potassium benzoate (preserves freshness), salt, red 40 and blue 1. • • • • •

Calories120 Total Fa Fat (g (g) 0 Sodium (mg) 45 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 34 Sugars (g) 33

Mirinda Grapefruit (8 fl. oz) Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, potassium benzoate (preserves freshness), purity gum, Erythorbic acid (preserves freshness), freshness), ester gum, natural flavors, and caramel color. • • • • • •

Calories120 Total Fa Fat (g (g) 0 Sodium (mg) 25 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 32 Sugars (g) 31 Protein (g) 0

Regular (8 fl. oz) Cont Contai ains ns:: Carbo Carbona nate ted d water water,, high high fruc fructo tose se corn corn syru syrup p and/ and/or or suga sugar, r, concen concentra trated ted orang orange e juice juice and other other natur natural al flavo flavors, rs, citric citric acid, acid, sodiu sodium m benzoate (preserves freshness), caffeine, sodium citrate, gum arabic, yellow 5, Erythorbic acid (preserves freshness), calcium disodium EDTA (to protect flavor) and brominated vegetable oil. • • • • • • •

Calories110 Total Fa Fat (g (g) 0 Sodium (mg) 50 Potassium (m (mg) 0 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 31 Sugars (g) 31 Protein (g) 0 42

Strategic Marketing

Pepsi Cola

• Caffeine (m (mg) 37 37

Mountain Dew: Code Red (8 fl. oz) Contains: Contains: Carbonated Water, High Fructose Corn Syrup and/or Sugar, Sugar, Orange Orange Juice Juice from concentrate, concentrate, Citric Acid, Sodium Sodium polyphospha polyphosphates, tes, Natura Naturall Flavor Flavor,, Sodium Sodium Benzoa Benzoate te (Prese (Preserve rvess Freshn Freshnes ess), s), Caffe Caffeine ine,, Sodium Sodium Citrate, Gum Arabic, Erythorbic Acid (Preserves Freshness), Calcium Disodium EDTA (to protect flavor), Red 40, Potassium benzoate (Preserves Freshness), Brominated Vegetable Oil, Yellow 5 and Blue 1. • • • • • • • •

Calories110 Total Fa Fat (g (g) 0 Sodium (mg) 70 Potassium (m (mg) 0 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 31 Sugars (g) 30 Protein (g) 0 Caffeine (m (mg) 37 37

Diet Mountain Dew (8 fl. oz) Contai Contains: ns: Carbo Carbonat nated ed water water,, concen concentra trated ted orang orange e juice juice,, citric citric acid, acid, aspartame, potassium benzoate (preserves freshness), citrus pectin, potassium citrate, caffeine, gum arabic, natural flavors, brominated vegetable oil, yellow 5 and Erythorbic acid (preserves freshness). • • • • • • • •

Calories0 Total Fa Fat (g (g) 0 Sodium (mg) 25 Pota Potass ssiium (mg) mg) 45 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (m (mg) 37 37

Regular Caffeine-Free Mountain Dew (8 fl. oz) Cont Contai ains ns:: Carbo Carbona nate ted d water water,, high high fruc fructo tose se corn corn syru syrup p and/ and/or or suga sugar, r, concen concentra trated ted orang orange e juice juice and other other natur natural al flavo flavors, rs, citric citric acid, acid, sodiu sodium m benzoate (preserves freshness), sodium citrate, gum arabic, Erythorbic acid (preserves freshness), calcium disodium EDTA (to protect flavor), yellow 5 and brominated vegetable oil. • Calories110 • Total Fa Fat (g (g) 0 • Sodium (mg) 50 43

Strategic Marketing

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Pepsi Cola

Potassium (m (mg) 0 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 31 Sugars (g) 31 Protein (g) 0 Caffeine (mg) 0

Diet Caffeine-Free Mountain Dew (8 fl. oz) Contai Contains: ns: Carbo Carbonat nated ed water water,, concen concentra trated ted orang orange e juice juice,, citric citric acid, acid, aspartame, potassium benzoate (preserves freshness), citrus pectin, potassium citrate, gum arabic, natural flavors, brominated vegetable oil, yellow 5 and Erythorbic acid (preserves freshness). freshness). • • • • • • • •

Calories0 Total Fa Fat (g (g) 0 Sodium (mg) 25 Pota Potass ssiium (mg) mg) 45 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (mg) 0

Mug Root Beer (8 fl. oz) Cont Contai ains ns:: Carbo Carbona nate ted d water water,, high high fruc fructo tose se corn corn syru syrup p and/ and/or or suga sugar, r, caramel color, sodium benzoate (preserves freshness), natural and artificial flavors, citric acid, modified food starch, Erythorbic acid (preserves freshness) and gum arabic. • • • • • • • •

Calories110 Total Fa Fat (g (g) 0 Sodium (mg) 45 Potassium (m (mg) 0 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 29 Sugars (g) 29 Protein (g) 0 Caffeine (mg) 0

Diet Mug Root Beer (8 fl. oz) Contains: Carbonated water, caramel color, aspartame, sodium benzoate (preserves freshness), natural and artificial flavors, citric acid, modified food starch and gum arabic. • • • •

Calories0 Total Fa Fat (g (g) 0 Sodium (mg) 45 Potassium (m (mg) 0 44

Strategic Marketing

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Pepsi Cola

Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (mg) 0

Mug Cream Soda (8 fl. oz) Contains: Carbonated water, high fructose corn syrup and/or sugar, natural and artificial flavors, sodium benzoate (preserves freshness), citric acid and caramel color. • • • • • • • •

Calories120 Total Fa Fat (g (g) 0 Sodium (mg) 45 Potassium (m (mg) 0 Tota Totall Car Carbo bohy hydr drat ates es (g) (g) 32 Sugars (g) 32 Protein (g) 0 Caffeine (mg) 0

Diet Mug Cream Soda (8 fl. oz) Contains: Carbonated water, natural and artificial flavors, sodium benzoate (preserves freshness), freshness), aspartame, citric acid and caramel color. • • • • • • • •

Calories0 Total Fa Fat (g (g) 0 Sodium (mg) 50 Potassium (m (mg) 0 Tota Totall Carb Carboh ohyd ydra rate tess (g) (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (mg) 0

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S.W S. W.O. .O.T T ANAL ANALYS YSIS IS General Environment THREATS & OPPORTUNITIES Social The social aspect pertaining to the case is very important and relevant. the impact of the social environment on Pepsi is very favorable due to the increase in population especially in the youth. Economic: The economic environment described in the case as well as through our research is again important & relevant. And although the world economy is in recession but loyal customers as well as other PepsiCo brand lovers managed to purchase their products. Political: The Pepsi legacy continues even after a hundred years and over the span of time a part of few minor glitches Pepsi has been operating in a very favorable political environment through out the world. Legal: Pepsi has adhered to all the legalities of the individual nations and due to this strict code of conduct they've never really come across any unnecessary legal issues. Technological: When it comes to Pepsi, it isn't an issue of technology but an issue of a Formula that is for the new product development they don't necessarily wait for technology advancement but bank on their formula advancement.

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Operating Environment: International: Peps Pepsii has deve develo lope ped d a very very stro trong base based d for for its its opera perati tio on in the the International arena and as such they don't d on't have any obstacles. Suppliers: The suppliers of the Pepsi Co. hold a very favorable position not only in the eyes of the company but also in the eyes of the consumers. And hold a very special position in supplying the Pepsi products. Competition: Pepsi has never closed its eyes even to the smallest direct or indirect competitors competitors and since since the beginning beginning always always forged forged ahead ahead with either mergers or acqu acquis isit itio ions ns.. This This show showss the the seri seriou ousn snes esss of the the Peps Pepsii Co. Co. towa towards rds its its commitments to be best in food & Beverages Company in the world. Coca-Cola is considered the biggest competitor of the Pepsi Cola Company, & strategist at every level specially keep in mind the activities of Coke. Customers: Pepsi Cola holds its customers at a very special place because they know their existence depends on their loyal customers, & it's their commitment to this customer base and their customer’s loyalty to the Pepsi Cola Company which has turned their Brands into a forever brand. Labour: Inte Integr grit ityy in the the Peps Pepsii Co. Co. is foll follow owed ed in any any & ever everyy situ situat atio ion n and and compromise on this integrity is never endeared. Pepsi Co. over its hundred-year history has never had problems with its employees due to its employee friendly policies. And their labour force also realizes their part and their roles in the growth & prosperity of Pepsi Co.

Internal Environment: STRENGTHS & WEAKNESSES Organizational Organizational Aspect: The internal working environment of Pepsi Co. is very advanced again due to their vast experience at Pepsi Co. managers at all levels are not afraid to make mistakes which may be uncontrollable and always refer to their seniors for assistance or advise. Marketing Aspect: The marketing team of Pepsi Co. continues to lead the marketing aspects in the beverages industry around the globe with their most wild imaginative and 47

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creative ideas which have created a personality for the Pepsi Co. brands which is shared by their customers. Every product of Pepsi characterizes the ideal or actual personality of their customers.

Financial Aspect: Pepsi Co. is a listed company on most of the global stock exchanges they have a special commitment towards its shareholders and towards the increment of their shareholders' wealth. Pepsi Co. enjoys excellent working relationship with their creditors and have never gone back on their financial commitment even in time of world wars and when the "great depression" occurred. Personnel Aspect: As mentioned earlier, Pepsi Co. takes very good care of its employees and intern demands the highest level of commitment from its personnel. in their eyes it's a game of give & take which they've been following very effectively. Production Aspect: Pepsi Co. uses state of the art production facilities through out the world even in regions where they are not producing directly. They use the highest standards of quality raw material which constitutes their products.

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Strategic Marketing

Pepsi Cola

GE MULTIFACTOR PORTFOLIO MATRIX This approach has many names including the nine cell GE Matrix. GE’s nice cell business portfolio matrix and the market attractiveness – business strength matrix matrix.. It was was develo developed ped at Gener General al Electr Electric ic with with the the help help of McKin McKinsey sey and Compa Company ny.. A leadin leading g consul consultin ting g firm. firm. Each Each of an organ organiza izatio tion n Busin Busines ess s or  Product is plotted in the matrix on two dimensions, industry attractiveness and business strength . each of these two major dimensions is a composite composite measure of a vari variet ety y of fact factor ors. s. The The twotwo-di dime mens nsio ion n make make good good sens sense e for for stra strate tegy gy formulation, because a successful business is typically on that is in an attractive industry and has the particular business strengths strengths required to succeed Depe Depend ndin ing g of where here busi busine ness sses es are are plot plot on the the matr matrix ix , thre three e basi basic c strategies are formulated • • •

Invest and grow Select In Investment Harvest/Divest

In our analysis we draw GE nine cell matrix based on the information given in case study , for different brand owned by Pepsi Co, and are available in Pakistan These Brands are

• • • • • • •

Mirinda Pepsi Cola Diet Pepsi Mountain Dew 7 Up Slice Aquafina

49

Strategic Marketing

Pepsi Cola

Computation of Industry Attractiveness and Business Strengths

1

Overall Market Size

0.20

4

0.8

2

Annual Market Growth Rate

0.20

3

0.6

3

Historical Profit Margin

0.15

2

0.3

4

Competitive Intensity

0.15

2

0.3

5

Technological Requirement

0.05

2

0.1

6

Inflationary Vulnerability

0.05

4

0.2

7

Energy Requirements

0.05

2

0.1

8

Environment

0.15

5

0.75

1

1

Market Share

0.100

2

0.2

2

Share Growth

0.150

2

0.3

3

Product Quality

0.100

4

0.4

4

Brand Reputation

0.100

4

0.4

5

Distribution Network

0.050

3

0.15

6

Promotional Effectiveness

0.150

2

0.3

7

Productive Capacity

0.025

4

0.1

8

Productive Efficiency

0.025

3

0.075

9

Unit Costs

0.050

3

0.15

10

Material Supplies

0.050

5

0.25

11

R&D Performance

0.050

4

0.2

12

Managerial Personnel

0.150

5

0.75

1.000

50

Strategic Marketing

Pepsi Cola

51

Strategic Marketing

Pepsi Cola

52

Strategic Marketing

Pepsi Cola

53

Strategic Marketing

Pepsi Cola

54

Strategic Marketing

Pepsi Cola

55

Strategic Marketing

Pepsi Cola

56

Strategic Marketing

Pepsi Cola

57

Strategic Marketing

Pepsi Cola

58

Strategic Marketing

Pepsi Cola

59

Strategic Marketing

Pepsi Cola

60

Strategic Marketing

Pepsi Cola

61

Strategic Marketing

Pepsi Cola

62

Strategic Marketing

Pepsi Cola

63

Strategic Marketing

Pepsi Cola

64

Strategic Marketing

Pepsi Cola

65

Strategic Marketing

Pepsi Cola

66

Strategic Marketing

Pepsi Cola

67

Strategic Marketing

Pepsi Cola

68

Strategic Marketing

Pepsi Cola

69

Strategic Marketing

Pepsi Cola

70

Strategic Marketing

Pepsi Cola

71

Strategic Marketing

Pepsi Cola

72

Strategic Marketing

Pepsi Cola

73

Strategic Marketing

Pepsi Cola

74

Strategic Marketing

Pepsi Cola

75

Strategic Marketing

Pepsi Cola

Pepsi Industry Attractiveness

Weight

Rating

Value

1

Overall Market Size

0.20

5

1

2

Annual Market Growth Rate

0.20

4

0.8

3

Historical Profit Margin

0.15

4

0.6

4

Competitive Intensity

0.15

2

0.3

5

Technological Requirement

0.05

2

0.1

6

Inflationary Vulnerability

0.05

4

0.2

7

Energy Requirements

0.05

2

0.1

8

Environment

0.15

5

0.75

1

Business Strengths

3.85

Weight

Rating

Value

1

Market Share

0.100

5

0.5

2

Share Growth

0.150

3

0.45

3

Product Quality

0.100

4

0.4

4

Brand Reputation

0.100

5

0.5

5

Distribution Network

0.050

4

0.2

6

Promotional Effectiveness

0.150

4

0.6

7

Productive Capacity

0.025

5

0.125

8

Productive Efficiency

0.025

4

0.1

9

Unit Costs

0.050

4

0.2

10

Material Supplies

0.050

5

0.25

11

R&D Performance

0.050

5

0.25

12

Managerial Personnel

0.150

5

0.75

1.000

4.325

76

Strategic Marketing

Pepsi Cola

Diet Pepsi Industry Attractiveness

Weight

Rating

Value

1

Overall Market Size

0.20

4

0.8

2

Annual Market Growth Rate

0.20

4

0.8

3

Historical Profit Margin

0.15

2

0.3

4

Competitive Intensity

0.15

4

0.6

5

Technological Requirement

0.05

2

0.1

6

Inflationary Vulnerability

0.05

4

0.2

7

Energy Requirements

0.05

2

0.1

8

Environment

0.15

5

0.75

1

Business Strengths

3.65

Weight

Rating

Value

1

Market Share

0.100

2

0.2

2

Share Growth

0.150

4

0.6

3

Product Quality

0.100

5

0.5

4

Brand Reputation

0.100

5

0.5

5

Distribution Network

0.050

3

0.15

6

Promotional Effectiveness

0.150

4

0.6

7

Productive Capacity

0.025

4

0.1

8

Productive Efficiency

0.025

4

0.1

9

Unit Costs

0.050

3

0.15

10

Material Supplies

0.050

4

0.2

11

R&D Performance

0.050

5

0.25

12

Managerial Personnel

0.150

5

0.75

1.000

4.1

77

Strategic Marketing

Pepsi Cola

Mountain Dew Industry Attractiveness

Weight

Rating

Value

1

Overall Market Size

0.20

4

0.8

2

Annual Market Growth Rate

0.20

3

0.6

3

Historical Profit Margin

0.15

2

0.3

4

Competitive Intensity

0.15

1

0.15

5

Technological Requirement

0.05

2

0.1

6

Inflationary Vulnerability

0.05

3

0.15

7

Energy Requirements

0.05

2

0.1

8

Environment

0.15

5

0.75

1

Business Strengths

2.95

Weight

Rating

Value

1

Market Share

0.100

1

0.1

2

Share Growth

0.150

1

0.15

3

Product Quality

0.100

2

0.2

4

Brand Reputation

0.100

1

0.1

5

Distribution Network

0.050

2

0.1

6

Promotional Effectiveness

0.150

1

0.15

7

Productive Capacity

0.025

1

0.025

8

Productive Efficiency

0.025

0

0

9

Unit Costs

0.050

1

0.05

10

Material Supplies

0.050

4

0.2

11

R&D Performance

0.050

1

0.05

12

Managerial Personnel

0.150

2

0.3

1.000

1.425

78

Strategic Marketing

Pepsi Cola

Slice Industry Attractiveness

Weight

Rating

Value

1

Overall Market Size

0.20

4

0.8

2

Annual Market Growth Rate

0.20

3

0.6

3

Historical Profit Margin

0.15

2

0.3

4

Competitive Intensity

0.15

2

0.3

5

Technological Requirement

0.05

2

0.1

6

Inflationary Vulnerability

0.05

4

0.2

7

Energy Requirements

0.05

2

0.1

8

Environment

0.15

5

0.75

1

Business Strengths

3.15

Weight

Rating

Value

1

Market Share

0.100

3

0.3

2

Share Growth

0.150

3

0.45

3

Product Quality

0.100

4

0.4

4

Brand Reputation

0.100

3

0.3

5

Distribution Network

0.050

4

0.2

6

Promotional Effectiveness

0.150

3

0.45

7

Productive Capacity

0.025

4

0.1

8

Productive Efficiency

0.025

3

0.075

9

Unit Costs

0.050

3

0.15

10

Material Supplies

0.050

5

0.25

11

R&D Performance

0.050

3

0.15

12

Managerial Personnel

0.150

4

0.6

1.000

3.425

7 Up Industry Attractiveness

Weight

Rating

Value

79

Strategic Marketing

Pepsi Cola

1

Overall Market Size

0.20

5

1

2

Annual Market Growth Rate

0.20

4

0.8

3

Historical Profit Margin

0.15

4

0.6

4

Competitive Intensity

0.15

1

0.15

5

Technological Requirement

0.05

2

0.1

6

Inflationary Vulnerability

0.05

4

0.2

7

Energy Requirements

0.05

2

0.1

8

Environment

0.15

4

0.6

1 Business Strengths

3.55

Weight

Rating

Value

1

Market Share

0.100

4

0.4

2

Share Growth

0.150

4

0.6

3

Product Quality

0.100

5

0.5

4

Brand Reputation

0.100

4

0.4

5

Distribution Network

0.050

5

0.25

6

Promotional Effectiveness

0.150

4

0.6

7

Productive Capacity

0.025

5

0.125

8

Productive Efficiency

0.025

4

0.1

9

Unit Costs

0.050

4

0.2

10

Material Supplies

0.050

5

0.25

11

R&D Performance

0.050

3

0.15

12

Managerial Personnel

0.150

5

0.75

1.000

4.325

Aquafina Industry Attractiveness

1

Overall Market Size

Weight

Rating

Value

0.20

5

1

80

Strategic Marketing

Pepsi Cola

2

Annual Market Growth Rate

0.20

5

1

3

Historical Profit Margin

0.15

4

0.6

4

Competitive Intensity

0.15

1

0.15

5

Technological Requirement

0.05

2

0.1

6

Inflationary Vulnerability

0.05

4

0.2

7

Energy Requirements

0.05

2

0.1

8

Environment

0.15

4

0.6

1 Business Strengths

3.75

Weight

Rating

Value

1

Market Share

0.100

3

0.3

2

Share Growth

0.150

4

0.6

3

Product Quality

0.100

5

0.5

4

Brand Reputation

0.100

2

0.2

5

Distribution Network

0.050

1

0.05

6

Promotional Effectiveness

0.150

1

0.15

7

Productive Capacity

0.025

5

0.125

8

Productive Efficiency

0.025

2

0.05

9

Unit Costs

0.050

5

0.25

10

Material Supplies

0.050

5

0.25

11

R&D Performance

0.050

3

0.15

12

Managerial Personnel

0.150

3

0.45

1.000

3.075

81

Strategic Marketing

Pepsi Cola

NEW CORPORATE MISSION: To create superior customer value and maximize shareholders equity by developing new products and reaching more markets. Our success depends on the the qual qualit ity y, our our prod produc uctt they they mus must be safe safe,, econ econo omica micall lly y effi effici cien entt and and environment friendly. We take care all our stakeholders and work as a family and provide equal opportunity to all our employees to develop and grow with their own company.

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Strategic Marketing

Pepsi Cola

Objectives • • • • • • • •

Incre Increase ase Profi Profitab tabilit ility y and and shar shareho eholde lders rs weal wealth th Cost Cost Cutt Cutting ing by by impr improvi oving ng meth methods ods of prod product uction ion New New prod produc uctt deve develo lop pment ment To enter enter new mark markets ets for exist existing ing produc products ts Impr Improv ove e qua qualit lity y of of our our prod produc ucts ts To enhance corporate imag mage and become world’s number one organization in soft drink industry More More oppo opportu rtunit nities ies for for empl employ oyees ees to to devel develop op and and grow grow Safe Safe guar guard d natu natura rall env envir iron onme ment nt

Corporate Strategy: Strategy related to specific Brand: Mirinda Indu Indust stry ry is rela relati tive vely ly attr attrac acti tive ve and and Busi Busine ness ss stre streng ngth thss ne need edss more more conc concen entr trat atio ion n at the the same same time time compa company ny hold holdss mode modera rate te mark market et shar share. e. Company should follow Invest/grow Strategy Pepsi Cola Industry is attractive and Business strengths are good at the same time Pepsi Pepsi holds holds good good market market share. share. Compan Companyy can follow follow Select Selective ive invest investmen mentt strategy. Diet Pepsi Industry attractiveness is high but total market is size is comparatively small. Business holds relatively good strengths. In such case company can make selective investment. Mountain Dew Indu Indust stry ry attr attrac acti tive vene ness ss is medi medium um and and Compa Company ny is lack lackin ingg busi busine ness ss strengths. In such case company have two choices either it can make some investment to get the desire capabilities or it can Harvest. 7 Up Industry attractiveness is high and Business strengths are good . Therefore there is no need to make huge investment investment rather selective selective investment investment can be make in some areas of interest. Slice 83

Strategic Marketing

Pepsi Cola

Industry attractiveness is moderate and same in case of business strengths. Company need to make investment to over come the weak point its has.

Aquafina Industry is highly attractive but business is lacking some required strengths. So think that company must make investment to over come its weak points.

Other Corporate Strategies: New product development: From our analysis of whole case study and relevant information gathered we come to know that there is a room for new product in company product mix offered in Pakistan. Company may introduce some of its exiting products in Pakistan or come up with entirely new product that could compete with Local Brand like ROOH AFZA, NORUS, etc.

Strategic Alliance, There’s Strength In Numbers Strategic alliances occur when two separate businesses join together to offer a broader set of skills or services to joint clients, to the mutual benefit of both companies. An alliance between companies that provide different, but complem complement entary ary,, servic services es or product productss allows allows both both compan companies ies to create create an advantage over competitors by broadening br oadening the scope of their operations. Alliances can make your business more valuable to t o your client, expand your business, multiply your sales force, and give you a dependable supplier of the aligned service or product. There are no rules restricting alliances: Large businesses may join with small businesses and vice versa; small businesses may band together, or large busi busine ness sses es may may coll collabo abora rate te with with each each othe other. r. But But ther there e are are thre three e basi basicc characteristics that most successful alliances share: The alliance benefits both partners. Good agreements open new doors for  the partners and allow room to evolve as future opportunities occur. Successful alliances create new value through collaboration. Partners must value the skills each party brings to the alliance. For an alliance to flourish, both parties must be involved in managing the partnership. An alliance without trust and respect is doomed to failure.

Pepsi Co can have strategic alliance with other up stream and down stream organization, this will will give them competitive competitive edge over over their competitors. competitors. While going for an strategic strategic alliance Pepsi Pepsi must concentr concentrate ate on what they do best, and bring added value to their customers.

84

Strategic Marketing

Pepsi Cola

Marketing Strategy SEGMENTING They are committed to marketing their products to all groups, treating all customers with respect, sensitivity and fairness, while providing some of the greatest products on earth. Early in its history - as far back as the 1940s - Pepsi-Cola recognized the importa importance nce of divers diversity ity.. Pepsi Pepsi pionee pioneered red targe targeted ted market marketing ing and and natio national nal lifestyle advertising featuring minorities. they developed education and sports programs spotlighting minorities. they partnered with many groups to create programs that contribute to minority communities. they sponsored major music tours by entertainers such as Michael Jackson and Tina Turner. they support minority media and interests. Over the years, their success has been recognized with numerous awards. Most importantly, their products are purchased and enjoyed by all groups of consumers.

PACKAGING Providing Providing their consumers consumers with easy-to-u easy-to-use, se, convenie convenient nt and innovativ innovative e containers is one of their top priorities. Package introductions they have made over the years include the industry's first two-liter bottle; the first company to respond to consumer preference with lightweight, recyclable, plastic bottles; The Cube, an easy-to-store 24-pack; Big Slam, the wide-mouth one-liter bottle; as well as our three-liter bottle, designed to provide consumers with extra value (not all products and packaging is available in all markets). Thei Theirr loca locall bottl bottler ers, s, many many of whic which h are are priv privat atel elyy owne owned, d, fran franch chis ise e operations, make all packaging decisions. Most of their bottlers are following the the indu indust stry ry-w -wid ide e tren trend d to use use plas plasti ticc pack packag agin ingg due due to en envi viro ronm nmen enta tall consid considera eratio tions. ns. The indust industry ry is now now making making greate greaterr use of fully fully recycl recyclabl able e aluminum cans and PET plastic bottles. The "CUBE" is Pepsi's new innovative 24-can multipack. It was dubbed the "CUBE" by consumer focus groups, which are a small test market population that that's 's invi invite ted d by Peps Pepsii-Co Cola la to give give the the comp compan anyy feed feedba back ck befo before re the the introduction of a new package or product. The consumer focus groups Pepsi used for this product coined the name the "CUBE" and it stuck! Polyethylene terephthalate, or "PET plastic," is a form of polyester used to make strong, lightweight, shatter-resistant bottles for soft drinks, water, juice and other non-food products. Bottles made from PET plastic, which are marked with with the the nu numb mber er one one code code on the the or ne nea ar the the bott bottle le of the the bott bottle le,, are are recyclable into products including new containers, fiberfill for sleeping bags and coats, fabric, carpet, auto parts, film and more

85

Strategic Marketing

Pepsi Cola

PRICING Providing quality products at the lowest possible price has always been one of Pepsi's main concerns. One of the ways they have been able to assist this effort is by expanding their use of inexpensive and recyclable plastic bottles. The soft drink industry today is confronted with a bewildering array of price increases. Their expenditures for labor, ingredients, transportation and more all continue to rise. The cost of aluminum alone has increased dramatically since last year. Across their entire system however, they have been cutting overhead and re-engineering their manufacturing process in order to keep their prices competitive. It is their policy to limit any price increases to the retail trade to the lowest possible extent.

Distribution Service They They shou should ld go to mark market et throu through gh a distri distribu buti tion on netwo network rk offe offeri ring ng extraord extraordina inary ry strengt strength h and flexib flexibil ilit ity. y. Their Their goal goal should should be to put their  their   products within easy reach of the consumer. Their distribution distribution systems must  be design to help then to achieve achieve their goal. Because practices and customs vary by market and because retail customers have different needs, Therefore they Should have several successful models for service that they use around the world.

Direct Store Delivery Vast and powerful direct store delivery (DSD) systems are at the heart of  that network. Through these systems they take snacks and drinks directly to tens of thousands of distribution outlets, from the tiniest convenience store to the largest warehouse outlet. They and their bottlers actually take products into the store and set them on the shelves. That helps to ensure that their   products are fresh and that fragile fragile items like potato chips are handled handled with care. It also allows them to merchandise their brands for maximum visibility and appeal. Their systems can move new products into distribution very quic quickl kly, y, somet sometim imes es as fast fast as a week. week. And And becau because se they they call call on retai retaill custo custome mers rs so frequ frequen entl tly, y, they they know know very very quic quickl kly y how how a new new produ product ct is selling. At the same time, DSD provides big financial benefits to retailers. Since they handle the products and do the merchandising, retailers save on labor. And because their products typically are sold and restocked every few days, while retailers pay for them on 30-day cycles, they add a lot to a store's cash flow.

86

Strategic Marketing

Pepsi Cola

Promotion Promo Promoti tion on is the the spec specif ific ic mix mix of adve advert rtis isin ing, g, pers person onal al sell sellin ing, g, sale saless promotion, and public relations a company uses to pursue its advertising and marketing objectives. Objectives The objectives that are met by promoting are to move the target market through the following phases: Unawareness -> Awareness -> Beliefs/Knowledge -> Attitude -> Purchase Intention -> Purchase It is believed that consumers cannot skip over a phase, but they need to move through them. Promotion is used to move the target market from one phase to another to finally purchase. The Offer The offer needs to be identified before you begin any promoting. What are you offering the target customer? What do you want the t he target market to do? d o?

PEPSI ADVERTISING For over 100 years, Pepsi-Cola has produced some of the finest soft drinks ads available anywhere in the world. From today's "Joy of Cola" campaign starring "Pepsi Girl" Hallie Eisenberg to yesterday's "Nickel, Nickel" (1939), their ads are as memorable as the products they produce. Both electronic and print media is used for promotional purpose.

Pepsi’s brand management The bond arising from the customer's entire experience with the brand leads to a relationship that can last forever. As the alignment grows stronger, so does the brand. People love it. And they buy it. Thus, born in corporate boardroom, pepsi has become a social artifact, having stolen its way into the popular lexicon and created history. This forever brand has continued to survive in spite of the changes taking place all around it. And the passage of time has failed to tarnish its glory. Who cares what it is made of? What matters is only that its tangy flavor has quenched the thirst of millions, its swoosh of effervescence has soothed parched souls since the 1890s and its scarlet hue has painted the world in to its three colours. on one hand we have have a marketing meltdown meltdown that is flagellating at least 50 per cent of all brands, on the other we have Pepsi that has continued to achieve meteoric growth despite all odds. This begs one question: what makes this forever brand different? The search for the right answer is what has driven an extensive research effort over the past few years to extract the essence of the success and to study the core ideas that have clicked so well with the cons consum umer ers. s. In the the camp campai aign gnss of this this fore foreve verr bran brandd-fi five ve ways ways have have been been 87

Strategic Marketing

Pepsi Cola

identified to the consumers' heart: self-statement, emotion, perception, virtual benefit, pride and values.

Self-statement Consumers prefer pepsi because it expresses their (desired) character and identity. This is all about the brand's power to tell a sharp, crisp and precise story about them. pepsi helps its consumers define their identity and express it. Within a split second, Pepsi can draw a complete picture of the consumer charac character ter,, perso personal nality ity and and identi identity. ty. This This forev forever er brand brand is found found to expre express ss precisely that personality or character trait aspired to by the consumer. To make the brand the 'megaphone' for what the consumer wants to express, Pepsi is powered by a provocative ideology that the consumers want want to proclaim.

Emotion Consumers prefer Pepsi because they love the brand. To generate feelings so powe powerf rful ul that that cons consum umer erss have have to buy buy the the bran brand d out out of love love,, Peps Pepsii is positioned as an ally to the consumers on an important emotional stance, which thei theirr mark market eter erss ident identif ifyy as the the key key behin behind d it. it. The The bond bond aris arisin ingg from from the the customer's experience with Pepsi leads to a relationship that can last forever. As the alignment grows stronger, so does the brand. People love it. And they buy it.

Perception The way people perceive Pepsi is the result of programmes pr ogrammes deeply ingrained in their minds. Consumers prefer the brand because perception and behavior programmes point to it as the only logical choice.

Virtual benefit Cons Consum umer erss pref prefer er this this brand brand beca becaus use e it offe offers rs a compe compell llin ingg (vir (virtu tual al)) benefit. To shape a virtual edge over competitors, with the unique flavor, Pepsi, refreshes one to feel as cool as ice.

Pride and values Consumers prefer Pepsi because it creates an inner satisfaction that they are still young.

Game plan of Pepsi: Conclusion Three main strategic imperatives for Pepsi

Owning and broadening the category Pepsi should strived hard to 'own' the category by making their brand's personality thoroughly distinct and then tried to broaden the way consumers 88

Strategic Marketing

Pepsi Cola

think about the category and the brand. Here Focused should should be on six primary personali personality ty traits traits viz. youthful youthful,, fun, fun, adventuro adventurous, us, exclusive, exclusive, outdoorsy outdoorsy and romantic.

Capturing all occasions Pepsi can enhance is competitive position by seeking out every possible sales opportunity by crowding sales channels and by maximising penetration and by using alliances to build presence quickly.

Building high-credibility personalities Pepsi must enhance their credibility and inspire trust in consumers. But bro broadly, dly, the heyy seem seem to dis disting tingui uish sh the themselv selves es most most in the the area reas of trustw trustwort orthin hiness ess,, leader leadersh ship ip and and intell intellige igence nce,, Compan Companyy must must commun communica icate te confidence so that customer feel that this soft drink is safe and they can always enjoy it The world around Pepsi is changing beyond recognition. And so is the temperament of the custodians of civilization. In order to keep pace with the times, this legendary brand went ahead to make small compromises with the fascinating changes around it while its core identity remained as unaltered as a genetic code. Pepsi must try to enhance its credibility, command trust, capture mind shares, earn loyalty and generate shareholder value

89

Strategic Marketing

Pepsi Cola

Table OF Contents

Title Fly Title Page Executive Summary

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EXECUTIVE SUMMARY: The company consists of: Pepsi-Cola Company, the world's second largest beverage company; Frito-Lay Company, the world's largest manufacturer and distri distribut butor or of snack snack chips chips and Tropi Tropican cana a Produc Products, ts, Inc., Inc., the the world' world'ss larges largestt marketer and producer of branded juices. PepsiCo, Inc. was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay. Pepsi recruits its first "spokesalien" Marfalump to star in its commercials supporting the campaign. Pepsi-Cola North America welcomes Gary Rodkin as President and CEO. The new look look repla replace cess Pepsi' Pepsi'ss curren currentt pedest pedestal al logo logo with with a ne new w brand brand identity that also more prominently features the Pepsi Globe against a blue background. Pepsi celebrates its centennial year with a birthday party that is

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attended by Pepsi-Cola bottlers from all over the world. In more than 30 markets currently conducting the Pepsi Challenge, the tastes of Pepsi and Pepsi ONE are preferred over Coke products in every market, especially in Philadelphia, Dayton, Tucson, San Antonio and Seattle. Pepsi Stuff.com lets consumers redeem points from specially marked packages of Pepsi products for more than a half-million cool prizes, and proves to be Pepsi's most popular online promotion ever. Pepsi unveils its FunWraps Factory, letting consumers personalize Pepsi cans with fun designs and unique messages. Pepsi puts "a little twist on a great thing," introducing lemon-flavored Pepsi Twist and Diet Pepsi Twist. The product launch launch marks marks the return to lemon-fl lemon-flavore avored d colas colas for Pepsi, Pepsi, which which distribut distributed ed Pepsi Light until the mid-1980s. Today consumers spend about $33 billion on Pepsi-Cola beverages. Brand Pepsi and other Pepsi-Cola products – including Diet Pepsi, Pepsi-One, Mountain Dew, Slice, Sierra Mist and Mug brands – account for nearly one-third of total soft drink sales in the United States, a consumer market totaling about $60 billion. PepsiPepsi-Col Cola a also also offers offers a variet variety y of non-ca non-carbo rbonat nated ed bever beverage ages, s, inclu includin ding g  Aquafina bottled water, Fruitworks Fruitworks and All Sport. In 1992 Pepsi-Cola formed a partnership with Thomas J. Lipton Co. PepsiCola also markets Frappuccino ready-to-drink coffee through a partnership with Starbucks. In 2001 SoBe became a part of Pepsi-Cola. Outside the United States, PepsiCola soft drink operations include the business of Seven-Up International. PepsiCola beverages are available in about 160 countries and territories. Peps Pepsii-Co Cola la be bega gan n sell sellin ing g its its prod produc ucts ts inte intern rnat atio iona nall lly y in 1934 1934 with with its its operations in Canada. In addition to brands marketed in the United States, major products include Mirinda and Pepsi Max. Pepsi-Cola North America includes the United States and Canada. Pepsi-Cola provides advertising, marketing, sales and promotiona promotionall support support to Pepsi-Co Pepsi-Cola la bottlers bottlers and food service service customer customers. s. 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-Cola Caffeine Free Pepsi Diet Pepsi Caffeine Free Diet Pepsi ONE Wild Cherry Pepsi, Pepsi Twist Mountain Dew Diet Mountain Dew Mountain Dew Code Red Red Mug Sier Sierra ra Mist Mist Slic Slice e Lipt Lipton on Bris Brisk k (Par (Partn tner ersh ship ip)) Lipt Lipton on Iced Iced Tea (Partnership) Dole juice drinks FruitWorks juice drinks Aquafina purified drinking water Frappuccino coffee beverages (Partnership) SoBe juice drinks and teas  AMP. The world's drinks giants Coca Cola and Pepsi are among the world's most recognised brand names. Can Evian, Volvic or Perrier create the Coke & Pepsi of  the water world? They They only only use use the the fine finest st ingr ingred edie ient ntss to ma make ke Peps Pepsii-Co Cola la produ product cts. s. To guarantee their consumers consistent quality, each ingredient must pass Pepsi-

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Cola Cola's 's high high stan standa dard rds, s, rigo rigoro rous us qual qualit ity y cont contro roll test testss an and d stri strict ct bott bottli ling ng procedures. There is essentially no fat in any Pepsi-Cola products. The main ingredients found in Pepsi-Cola products include carbonated water, . For a complete breakdown by ingredients by product, . For over 100 years, Pepsi-Cola has produced some of the finest soft drinks ads available anywhere in the world. Pepsi’s brand management Who cares cares what what PEPSI PEPSI is ma made de of? Consum Consumer erss prefer prefer pepsi becau because se it expresses their (desired) character and identity. pepsi helps its consumers define their identity and express it. Consumers prefer Pepsi because they love the brand. Consumers prefer Pepsi because it creates an inner satisfaction that they are still young. New mission mission statement statement of Pepsi can be; To create superior superior customer value value and maximize shareholders equity by developing new products and reaching more markets. Our success depends on the quality, our product they must be safe, saf e, econo economic micall ally y eff effici icien entt an and d enviro environm nment ent friend friendly. ly. We take take care care all all our stakeholders and work as a family and provide equal opportunity to all our employees to develop and grow with their own company Company can also follow following strategy for there specific SBU.

Indu Indust stry ry is rela relati tive vely ly attr attrac acti tive ve an and d Busi Busine ness ss stre streng ngth thss ne need edss more more conc concen entr trat atio ion n at the the same same time time comp compan any y hold holdss mode modera rate te ma mark rket et shar share. e. Company should follow Invest/grow Strategy

Industry is attractive and Business strengths are good at the same time Pepsi Pepsi holds holds good good ma marke rkett shar share. e. Compa Company ny can follow follow Se Selec lectiv tive e invest investme ment nt strategy.

Industry attractiveness is high but total market is size is comparatively small. Business holds ratively good strengths. In such case company can make selective investment. From our analysis of whole case study and relevant information gathered we come to know that there is a room for new product in company product mix offered in Pakistan. Company may introduce some of its exiting products in Pakistan or come up with entirely new product that could compete with Local Brand like ROOH AFZA, NORUS, etc.

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The bond arising from the customer's entire experience with the brand leads to a relationship that can last forever. As the alignment grows stronger, so does the brand. People love it. And they buy it. Thus, Thus, born born in corpor corporate ate boardr boardroom oom,, Pepsi Pepsi ha hass become become a social social artifa artifact, ct, having stolen its way into the popular lexicon and created history. This forever brand HAS continued to survive in spite of the changes taking place all around it.  And the passage of time has failed to tarnish its glory. Who cares what pepsi is made of? What matters is only that its tangy flavor has quenched the thirst of  millions, its swoosh of effervescence has soothed parched souls since the 1890s and its scarlet hue has painted the world in to three colours. Pepsi should strived hard to 'own' the category by making their brand's personality thoroughly distinct and then tried to broaden the way consumers think about the category category and the brand. Here Focused should should be on six primary primary person personal ality ity trait traitss viz. viz. youthf youthful, ul, fun, fun, adven adventur turous ous,, exclu exclusiv sive, e, outdoo outdoorsy rsy and romantic. Pepsi Pepsi must must en enhan hance ce their their credib credibili ility ty and inspi inspire re trust trust in consu consumer mers. s. But But broa broad dly, ly, the hey y see eem m to dist distin ingu guis ish h the themselv selve es most ost in the area reas of  trustw trustwort orthin hiness ess,, leade leadersh rship ip an and d intell intellige igenc nce, e, Compa Company ny must must commu communic nicate ate confidence so that customer feel that this soft drink is safe and they can always enjoy it. The world around around Pepsi Pepsi is chang changing ing beyond beyond recogn recogniti ition. on. And so is the temperament of the custodians of civilization. In order to keep pace with the times, this legendary brand went ahead to make small compromises with the fascinating changes around it while its core identity remained as unaltered as a genetic code. Pepsi must try to enhance its credibility, command trust, capture mind shares, earn loyalty and generate shareholder value.

CASE STUDY  On

PepsiCo 93

Strategic Marketing

Pepsi Cola

Bahria Institute Of Management And Computer Sciences Karachi (Bahria University)

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