SYNOPSIS

ON
A COMPARATIVE STUDY ON ADVERTISING
EFFECTIVENESS OF COCA-COLA & PEPSI

For partial fulfillment of the requirement for the degree of

Master of Business Administration
(Full-Time)
Batch 2018-2020

Submitted By : Guided By :
Sona Rawat Dr. S. K. Tripathi
MBA (FT) (Sec. B)
INTRODUCTION

Advertising Effectiveness :
Advertising effectiveness pertains to how well a company's advertising
accomplishes the intended. Small companies use many different statistics or
metrics to measure their advertising effectiveness. These measurements can be
used for all types of advertising, including television, radio, direct mail, Internet
and even billboard advertising.

It is not at all possible to measure advertisement effectiveness accurately as there

are many factors like making a brand image, increasing the sales, keeping people
informed about the product, introducing new product, etc, which affect the
effectiveness of an advertisement.

We all know that there are some companies who advertise at very low level but
still their products are a hit and some companies indulge in very heavy
advertisements but they don’t get desirable results. But then, there are some
traditional and modern tools to measure most of the effectiveness of an
advertisement through which the advertiser can or may get more and more
information about how their ads and product are performing in the market.
According to Philip Kotler and Armstrong, the Gurus Of Marketing, there are two
most popular areas which need to be measured for knowing the effectiveness of
advertisement and they are:

 Communication Effect
 Sales Effect
DETAILS OF THE COMPANY

Pepsi Co. :

Pepsi was found in New-York in 1965. It is producing Non- alcoholic beverage

and food processing items. Pepsi is a carbonated beverage that is produced and
manufactured by Pepsi Company. It is sold in retail stores, restaurants cinemas
and from vending machines.

The drink was first made in the 1890s by pharmacist Caleb Bradham in NewBern,
North Carolina. Pepsi Company is one of the world’s top consumer product
companies with many of the world’s most important and valuable trademarks. Its
Pepsi-Cola Company division is the second largest soft drink business in the world.

On August 28, 1898, Bradham renamed his drink “ Pepsi-Cola.” He Believed the
drink was more than refreshment but a “healthy” cola, aiding in digestion, getting
its roots from the word dyspepsia, meaning indigestion. The brand was
trademarked on June 16, 1903.

Pepsi arrived on the market in India in 1988. PepsiCo gained entry to India in 1988
by creating a joint venture with the Punjab government- owned Punjab agro
Industrial Corporation (PAIC) and Volta’s India Limited. This joint venture
marketed and sold Lehar Pepsi until 1991, when the use of foreign brands was
allowed; PepsiCo bought out its partners and ended the joint venture in 1994.
Others claim that firstly Pepsi was banned from import in India, in 1970, for
having refused to release the list of its ingredients and in 1993, the ban was lifted,
with pepsi arriving on the market shortly afterwards. These controversies are a
reminder of “India’s sometimes acrimonious relationship with huge multinational
companies.” And Pepsi is one of them.

Ingredients :

Pepsi Co contains basic ingredients found in most other similar drinks including :

 Carbonated water,
 High fructose corn syrup,
 Sugar,
 Colourings,
 Phosphoric acid,
 Caffeine,
 Citric acid,
 And natural flavors.

The caffeine- free Pepsi Co contains the same ingredients minus the caffeine.
COCA-COLA :

Coca-Cola is a carbonated soft drink sold in stores, restaurants and vending

machines worldwide. The Coca-Cola Company started in Atlanta. Georgia
produces it. It was incorporated in 1886. The Coca-Cola Company claims that it is
sold in over 200 countries.

Coca- Cola came to India in the year 1956. Since India had not any foreign
exchange act, Coca-Cola made huge money operating under 100% foreign equity.
The US soft drink giant, Coca-Cola, rendered India in the 1990s after abandoning
its business in the late 1970s in the wake of Foreign Exchange Regulation Act of
1973. The Act, meant to ‘Indianite’ foreign companies to dilute their shareholdings
to 40%. Instead of diluting its shareholdings to the required limit prescribed by the
Act, Coca-Cola opted to discontinue its operations in India. In 1993 Coca-Cola re-
entered after government approval, due to the new liberalization policies that were
coming to India. The foreign exchange act which had once prevented companies
from keeping too much equity had now been completely modified. The
modification made it so that companies which exceeded foreign equity by 40% of
the total were to be treated on par with Indian companies. Automatic approval was
to be granted for equity investment of up to 51% and for foreign technology
agreements in high priority industries. In 1999, Coca-Cola bought Parle, India’s
top soft drink brand, which bottled Thumps up, Limca and Gold Spot.
The Coca-Cola Company is the world’s largest beverage company and is the
leading producer and marketer of soft drinks. Coca-Cola is a leading player in the
Indian beverage market with an approximate 60% share in carbonated soft drinks
segement.

Ingredients :

 28 g caffeine citrate
 85 g citric acid
 30ml vanilla extract
 946 ml lime juice
 71 g “flavoring”, i.e., “Merchandise 7X”
 14 kg sugar
 118.3 ml fluid extract of coca leaves (flavor essence of the cola leaf)
 9.51 ; 2.1 imp gal water
 Caramel sufficient to give colour.
REVIEW OF LITERATURE

William R. George (1999) reveals purpose of study of factors responsible for

advertising in soft drink industry, increasing competition more, due to
globalization is motivating many companies to base their strategies almost entirely
on making advertising effective. Advertising effectiveness is influenced by various
factors.

Donnelly (1995) said intensity of colors and flavors are the key drivers behind
consumer acceptance of soft drinks. But packaging and labeling are not important
for winning over consumer, according to findings published in journal food
Quality and preference. When the market is overloaded the challenge consists in
creating innovative ways to advertise the products which able to attract and satisfy
consumers.

Stepheas Daniells (2008) said these four factors were identified for the
formulation : four color intensities, three flavorings, two label types and two pack
sizes. By using both quantitative and qualitative approaches, the researchers found
that “The main factors which affect the advertising effectiveness for this concept
are colour intensity and flavourings’’.
Beverly J. Tepper (1998) examined the relative contributions of taste and health
considerations on consumer likings and purchase intent of cola drinks. Data were
analyzed using factors analysis. Results revealed that advertising effectiveness of
cola & pepsi drinks was strongly related to degree of liking and to several key
sensory attributes including drink flavors, varities and greasiness.

Bonner et al. (2001) argued that competition in the beverage industry is increasing
on all fronts (advertising, price, product service, etc.) As a result, distributors need
to understand what is important to retailers and assess, how they and their
competitors are meeting those needs in the supply chain. The findings of this study
reveals that there is low degree of brand awareness in rural areas, whereas there is
a moderate degree of brand awareness in urban area.
RATIONALE OF STUDY

1. The main need of the study to find out the advertising effectiveness of the
Coca-Cola and Pepsi Co, Which is more popular among the consumers, on
the basis of the beverage itself and as well as the respective advertising and
market strategies.
2. The secondary purpose of the study is to visit the outlet in a particular area
and get as much information as possible on both the brands.
3. To know the competitive position of Pepsi Co with respect to Coca-Cola and
the consumption pattern of flavored soft drinks of the consumers.

Because of this reason the comparative analysis is very important and useful to the
Company. By the use of comparative analysis the companies can understand the
position of the company and the strength of the company in the market. Through
the comparative analysis we can understand that what strategies the competitors
are using for the increase their sales volume.

From the study we can gather the information regarding the opinion of the retailers
on the companies comparatively and this will help to plan for the future to increase
the performance of the company and to gain the loyalty of the retailers when
compared to the competitors.
OBJECTIVES OF STUDY

 To study the overview of Pepsi Co and Coca-Cola Company.

 To know and compare the advertising of Pepsi Co and Coca-Cola
 To identify the customers opinion towards Pepsi Co products when
compared to Coke products.
 To offer some findings and suggestions to the company for the improvement
of its performance to fulfill the customer satisfaction level.
 To identify consumer preference, perception, towards soft drinks.
RESEARCH METHODOLOGY

Research is defined as human activity based on intellectual application in the

investigation of matter. The term research is also used to describe an entire
collection of information about a particular subject. And the methodology is the
method followed while conducting the study on a particular project. Through this
methodology a systematic study is conducted on the basis of which the basis of a
report is produced. Research methodology has many dimensions. It includes not
only the research methods but also considers the logic behind the methods used in
the context of the study and explains why only a particular method or technique
has been used.

Data Collection :

Keeping in view the nature of requirements of the study to collect all the relevant
information regarding the project. And the data collection method is taken
Descriptive Method. Data is collected through survey in Indore.

Sources of Data :

 Primary Data : Through Questionnaires

 Secondary Data : Through Internet, Magazine, & Newspapers.
Sample Design :
In this research, Descriptive research Design is used, Judgement and
Convenience, Probability, Sampling will be used to get the information
about customer satisfaction with reference to Pepsi Co & Coca Cola.

Sample Size :
It indicates the numbers of people to be surveyed. Though large sample give
more reliable results than small samples but due to constraint of time and
money, the sample size restricted.
WEBLIOGRAPHY

1. www.pepsiworld.com
2. www.academia.edu
3. www.google.com