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Vision ................................................................................................................. 4
Goals.................................................................................................................. 5
Values................................................................................................................. 5
Product Line........................................................................................................7
SITUATIONAL ANALYSIS..............................................................................................................8
Market Summary................................................................................................8
Market Demographics.........................................................................................9
SWOT Analysis..................................................................................................10
Competitor Analysis..........................................................................................12
MARKETING STRATEGY.............................................................................................................14
Marketing Objectives........................................................................................14
POSITIONING..................................................................................................................................16
MARKETING MIX..........................................................................................................................17
Product............................................................................................................. 17
Price.................................................................................................................. 18
Promotion......................................................................................................... 21
Placement.........................................................................................................23
CONCLUSION..................................................................................................................................26
APPENDICES...................................................................................................................................27
Appendix-I........................................................................................................ 27
Appendix-II........................................................................................................30
COMPANY PROFILE
2
Formed in 1965, PepsiCo is the world’s
second largest Food and Beverage
Company with its estimated worldwide
retail sales of US$ 92 billion in 2006. In
Pakistan, it is best known for its flagship
product Pepsi-Cola.
Many of PepsiCo's brand names are more than 100-years-old, but the corporation is relatively
young. PepsiCo was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay.
Tropicana was acquired in 1998 and PepsiCo merged with The Quaker Oats Company,
including Gatorade, in 2001.
PepsiCo offers product choices to meet a broad variety of needs and preference --
from fun-for-you items to product choices that contribute to healthier lifestyles.
PepsiCo International
PepsiCo International manufactures a
number of leading salty and sweet snack
brands through consolidated businesses as
well as through non-controlled affiliates.
PepsiCo snack brands are distributed in about 170 countries, making PepsiCo the
largest salty snack company in the world.
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VISION
MISSION STATEMENT
They believe that their commercial success depends upon offering quality and
value to their consumers and customers; providing products that are safe,
wholesome, economically efficient and environmentally sound; and providing
a fair return to their investors while adhering to the highest standards of
integrity.
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GOALS
Non-Financial Goals
- Sharply focus their financial and management resources on their core
businesses.
Financial Goals
- To obtain a real growth of earnings per share of 15% per year over
time.
VALUES
Sustained Growth
“Sustained Growth” means consistent growth for our business as well as
our people — growth year after year.
Empowered People
Decisions that drive the business come from tens of thousands of PepsiCo
associates throughout the world who develop, manufacture and deliver our
products. Empowered people act and think in ways that get the job done,
and innovate to find new ways to achieve growth.
5
COMPETITIVE ADVANTAGES
• Strong Brands
PepsiCo brands and products are known and trusted by consumers around
the world. PepsiCo constantly revitalizes these brands with packaging and
product improvements and consumer promotions to keep them strong.
PepsiCo’s ability to
innovate is another
competitive advantage.
They look for
opportunities to capitalize
on the value of its brands
by creating new products
and varieties. By
innovating to meet
consumer needs and
preferences, the company fill consumption gaps and contribute to creating
both healthier and indulgent choices for consumers, and bringing more
enjoyment to their lives.
The strength and span of their systems help them quickly introduce a
product into the market – which helps them put their products within easy
reach whenever a consumer is thirsty or hungry. Moreover, their direct-
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store-delivery system allows them to respond quickly to the marketplace
and tailor their marketing and merchandising.
PRODUCT LINE
PepsiCo has hundreds of brands around the globe. Some of the best known
available in Pakistan are as follows:
Beverages:
• Pepsi Cola
• Diet Pepsi
• Pepsi Twist
• Mirinda
• Teem
• 7UP
• Mountain Dew
• Slice
• Tropicana
• Aquafina
Snacks:
• Lay’s
• Kurkure
• Cheetos
• Doritos tortilla
• Quaker Oatmeal
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SITUATIONAL ANALYSIS
Pakistan's food sector is also changing significantly as lifestyles and traditional eating
habits are shifting. It is becoming a developing and modern country at an
extraordinary fast pace. This change is being viewed positively and is being
capitalized by entrepreneurs.
MARKET SUMMARY
With the population of 166 million (July 2006 estimated), Pakistan holds the
world’s ninth largest market. And it is estimated that Pakistan’s total
population will reach 169 million by 2007 with 34% urban population. And by
the next decade the population is expected to exceed 176 million.
Although poverty does exist, 70% of the population lives above the poverty
line, which is enabling the consumer base to grow and diversify. Due to the
influence of Western media, Pakistan’s food sector has seen some significant
changes as traditional lifestyles and eating habits are shifting.
The 3 major cities and the biggest consumer markets in Pakistan are Karachi
with a population of 15 million people, Lahore with 10 million people and
Faisalabad with 2.6 million people. Other major cities include Rawalpindi,
Multan, Hyderabad, Gujranwala, Islamabad, Sukkur and Peshawar where
there is an emergence of middle-class.
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MARKET DEMOGRAPHICS
Population 166m
Growth Rate 2.09%
Urban Population 56m
Urban Population 2.1%
Growth Rate
Size of Middle Class 82m
Middle Class Growth 3%
Rate
July 2006 estimated
Age Structure
Age Category %
share
0 – 14 Years 39%
15 – 64 Years 57%
65 Years & Over 4%
July 2006 estimated
Market Needs
Market Trends
9
Consumers tend to eat out more often due to the fact that economically, income
is showing a rising trend. Advertising is also helping to stimulate demand for
branded food. Increasingly these items are becoming available in small towns
and more rural areas. However, income constraints, traditional eating habits,
limited marketing and a lack of consumer awareness continue to be significant
impediments to increasing demand for consumer-ready foods for much of
Pakistan’s population.
Market Growth
Pakistan economy’s average growth rate during 2000-2006 has been one of the
highest in the world. Pakistan’s per capita real GDP has increased at an average
of 5.6 percent per annum during the last three years leading to a rise in average
income of the people. Such increases have led to a sharp increase in consumer
spending during the last three years. As opposed to an average annual increase
of 1.4 percent during 2000-2003, the real private consumption expenditure has
grown at an average rate of 10.9 percent per annum during the last three years.
SWOT ANALYSIS
The following analysis shows the internal and external factors affecting the
market opportunities for PepsiCo:
Strengths
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• PepsiCo products are the choice of New Generation, but it is also famous
among other generations as well
• PepsiCo remained an innovator in the food and beverages market by
coming up with differentiated products. The continuous effort of their
R&D has proven to be creative in capitalizing opportunities with changing
market trends.
• Already established snack food manufacturing units in Pakistan
Weakness
Opportunities
• For PepsiCo in Pakistan, the market for snack food products is not new
and is open for expansion
• The largest segment of Pakistan population falls in the age bracket of 15-
64 years and accounts for 57% of total population. This segment is
health conscious and thus adds to the demand for branded snacks
• Target market is youth and elders. This segment is not being targeted
very well by any other snack brand
• Opportunities for new-to-market products are high as consumer food
sales are expanding at a rate of 10 percent per annum
• Low cost of manufacturing due to locally produced low cost raw material
and cheap local labour
• Pakistanis are more inclined to products that are made from natural
ingredients, and prefer natural products over artificial
• In urban population, quality and safety are important decision variables
• The accession of Pakistan into the WTO is a positive scenario that can
help the long term stability of the Pakistani economy
• Comparable competition not yet exists in branded products
Threats
11
•PepsiCo must constantly look up for changing taste of the consumer and
respond to that need immediately or risk losing market share
• Regional tastes and preferences vary that may affect the sales
• It may happen that consumers do not recognize and adopt a totally new
taste
• Consumer preferences may shift due to changes in social trends, changes
in vacation or leisure activity patterns, or a downturn in economic
conditions, that may reduce consumers’ willingness to purchase their
products
• There is some competition by existing unbranded snacks of this kind
available at Nimko Stores
• Competitors may adopt the recipe and start producing it
• Success is also dependent on the effectiveness of advertising campaigns
and marketing programs.
• Induction into the WTO opens the doors for other branded snacks
companies to enter this market
• The raw materials and energy used in the production is subject to price
volatility caused by changes in supply and demand. If commodity price
changes result in unexpected increases in raw materials and energy
costs, we may not be able to increase our prices to offset these increased
costs without suffering reduced volume, revenue and operating income.
• Failure to successfully launch this new product could decrease demand
for their existing products by negatively affecting consumer perceptions
of existing brands. Moreover, any damage to their reputation could have
an adverse effect on their business, financial condition and results of
operations.
COMPETITOR ANALYSIS
12
PepsiCo being a consumer product company relies on continued demand for
their products. To generate revenues and profits, it must sell products that
appeal to their customers and consumers. Any significant changes in
consumer preferences and any inability to anticipate and react to such
changes could result in reduced demand for their products.
PepsiCo, however, believes that the strength of their brands, innovation and
marketing, coupled with the quality of their products and flexibility of their
distribution network, allow them to compete effectively. Its success depends
upon their ability to respond to consumer trends, such as consumer health
concerns about obesity, product attributes and ingredients.
Major Competitors
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MARKETING STRATEGY
PepsiCo’s strategies are aligned with the interests of their consumers. To help these
consumers achieve energy balance, PepsiCo is providing them with convenient,
healthier products they want to consume and that fit their busy lifestyles. The
company also encourages them to engage in physical activities they enjoy.
MARKETING OBJECTIVES
PepsiCo has an extremely large customer base due to the wide spread
popularity of its beverages and snacks. It is therefore necessary to
segment the market and look at particular trends in the snacks market.
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There are two key trends in the snacks market:
Kurkure targets those consumers who prefer light snacks that have
spicy or chatpata taste, are conveniently taken, and are of good
quality.
Geographic
Demographic
Behavioural
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POSITIONING
Customers concentrating on health had to settle for a less appealing variety and taste
in branded products.
The umbrella image of Pepsi also gives this product a better positioning as the
consumers can immediately relate the name to the benefits of the product.
Finally, the colours and packing of product package will also help position the
product.
The way the product is defined by consumers on important attributes – the place the
product occupies in consumers’ minds relative to competing products. As for as the
Kurkure is concerned there are some sort of attribute defined by the costumers given
below
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MARKETING MIX
PRODUCT
Variants
Main Ingredients
Vegetable oil, natural flavour, sugar, citric acid, wheat flour mixed spices,
flavour enhances (E635), whey powder(from milk), permitted food color
(E160c) and salt.
Useful Life
Branding
• The name ‘Kurkure’ has been devised considering the wavy shape of the
product
• Pepsi and Lays logos are being used as an umbrella brand
• Distinct name, easy to pronounce
17
Packaging
• Recyclable material
• Large carton will have 48 packs, while small carton 24 packs
Labelling
PRICE
Product price is based on offering high value, best quality and freshness to our
customers. Pricing strategy is made relatively moderate i.e. within the
financial reach of an average-income consumer. Rs. 10/- is the proposed price
for 50 grams pack. This ensures competitive pricing and eventually strong
margins.
After analyzing the consumer feedback received from our initial consumer
survey (without product), we have applied the cost-plus based pricing strategy,
calculation of which is given below:
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Fixed costs:
Variable costs:
Price Calculation:
Unit Cost
Markup Price
Retail Price
16
14
12
10
8
Price
6
4
2
0
Samosa Kurkure Nimkos Chips Fries Biscuits
Payment terms:
20
All sales shall be made on cash basis only, as per existing PepsiCo
policy.
PROMOTION
Promotion Objectives
Outdoor Activities
• Kurkure Posters
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• Hanging Tags
• Three-Tier Cart
Tagline
Consumer Promotion:
Trade Promotion:
22
PLACEMENT
Distribution
Availability
The product is made and conveniently available at all major and minor
retail stores.
Replacements
23
Promotional Budget
Budget Allocation
Media %
Type Allocated
Satellite TV 69.7%
Radio 18.4%
Cable 1.5%
Newspaper 3.9%
Magazine 1.0%
Outdoor 5.5%
24
Gross Profit/Loss calculated @Rs. 3.00/- per unit sale
25
CONCLUSION
Kurkure is a potato chips which is launched by Pepsi in july-2006. It has good image
in the market due to quality. It is identified with the name of Kurkure. It used
individual branding strategy, which helped the Kurkure in developing the brands
image in the market. Kurkure is for all the people and families. Even younger or
older want to eat the Kurkure. The promotional activities are not so good as
compared to the competitor of the Kurkure it should increase its promotional
activities. They should provide good packages for its costumers means gift hampers,
prizes and, cash prizes etc.
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APPENDICES
APPENDIX-I
27
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SUMMARIZEDQUESTIONNAIREFEEDBACK- C
Que
8 What if someone comes up with something n
a. Would be great
b. Don’t care
c. Unanswered
SUMMARIZEDQUESTIONNAIREFEEDBACK- R
Que
1 What type of snacks consumer prefer most?
a. Chips
b. Biscuits
2 Locality
a. Residential
b. Commercial
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BIBLIOGRAPHY
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