PROJECT REPORT ON A STUDY OF MARKETING STRATEGIES BETWEEN PEPSI AND COCA COLA

Submitted in Partial Fulfillment for the Award of the Degree of Bachelor in Business Administration 2010-2012 Under the Guidance of: Mrs. Sanam Sharma Faculty of Finance Submitted By: Jyotsna Duggal BBA (GEN) SEC-B, IIIrd Semester, IInd Shift Enrollment no.13961101709

Maharaja Agrasen Institute of Management Studies Affiliated to Guru Gobind Singh Indraprastha University, Delhi 1

PSP Area, Plot No. 1, Sector 22, Rohini, Delhi 110086

STUDENT DECLARATION

This is to certify that I have completed the Summer Project titled (A Study on Marketing Strategies Between Pepsi and Coca Cola) under the guidance of (Mrs. Sanam Sharma) in partial fulfillment of the requirement for the award of Degree of Bachelor of Business Administration at Maharaja Agrasen Institute of Management Studies, Delhi. This is an original piece of work & I have not submitted it earlier elsewhere.

Date: 20th October, 2010 Place: Delhi

Signature: Name: Jyotsna Duggal Enrollment no. 13961101709

CERTIFICATE FROM THE INSTITUTE GUIDE

This is to certify that the summer project titled (A Study on Marketing Strategies Between Pepsi and Coca Cola) is an academic work done by Jyotsna Duggal submitted in the partial fulfillment of the requirement for the award of the degree of Bachelor of BusinessAdministration at Maharaja Agrasen Institute of management Studies, Delhi, under my guidance & direction.To the best of my knowledge and belief the data & information presented by her in the project has not been submitted earlier.

Signature

Name of the Faculty : Mrs. Sanam Sharma Designation : Lecturer

ACKNOWLEDGEMT

This project work, which is my first step in the field of professionalism, has been successfully accomplished only because of timely support of my well wishers. I would like to pay my sincere regards and thanks to those, who directed me at every step in my project work. First of all, I would like to express my thanks to Dr. N.K.KAKKAR (Director, MAIMS) for giving me such a wonderful opportunity to widen the horizons of my knowledge. I extend my thanks to my project guide Mrs. Sanam Sharma for her scholarly guidance, constant supervision and encouragement. It is due to her personal interest and initiative that the project work is published in the present form. Last but not the least, I would also thank all the staff members of MAIMS, friends and parents who have directly or indirectly contributed in making this project a success. It is a tribute for their valuation. Despite all efforts, I have no doubt that error and obscurities remain that seen to afflict all writing projects and for which I am culpable.

JYOTSNA DUGGAL BBA (GEN), SEC-B IInd SHIFT, IIIrd SEM Enrollment no. 13961101709

EXECUTIVE SUMMARY

Gone are the days when people were very unsure about the future and hardly cared, about it in terms of technological developments. But the situation has changed now. In the new millennium, people often feel a growing uneasiness about the future. Certainly many countries today are suffering from chronic high unemployment, a persistent deficit of economy and gradual deterioration of purchasing power. Nations are passing through a phase of rapid transformation. Two forces are mostly responsible for these types of drastic changes; they are explosive growth of trade and international competition and the other force like technological change. This new era has witnessed remarkable advancement in the availability of information and a number of large companies operations in such market where the principal of natural selection lead to survival of the fittest. This report introduces a brief study of marketing strategy and sales promotion technique of PepsiCola for retailers. The study report will provide an opportunity to know retailers psychographic needs, it may provide an opportunity to the PepsiCo & Coca-cola to frame a good future plan to satisfy maximum needs, taste preferences of the retailers. The Analysis reports provides detailed information about prevailing market competition and thus prepare itself to meet the market challenge by making adjustment in its new strategy and promotions activities.

INDEX

Students Declaration Certificate from the Guide Acknowledgement Executive Summary Table of contents

i ii iii iv

Chapter 1

Introduction 9 15 18 23 39 42

1.1 About soft drinks 1.2 Formulation of soft drinks 1.3 History of Pepsi 1.4 Company Profile of Pepsi 1.5 History of Coca-Cola 1.6 Company profile of Coca-Cola

Chapter 2

Research Methodology 50 51

2.1 Meaning 2.2 Objectives

2.3 Significance 2.4 Data collection source 2.5 Limitations

52 53 54

Chapter 3
3.1

Marketing Marketing : Introduction 56 57 60 67 70 71 77 81 85

3.2 Marketing Mix of Pepsi 3.3 Marketing Mix of Coca-Cola

3.4

Market Segmentation

3.5 Technique for Sales Promotion 3.6 Basic Channel of Distribution 3.7 Marketing Strategies Of pepsi 3.8 Marketing strategies of Coca-Cola 3.9 Other Strategies Adopted

Chapter 4 Chapter 5 Chapter 6

Findings and Analysis Conclusion Recommendations

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89 92 94

Bibliography

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CHAPTER - 1

INTRODUCTION

1.1 INTRODUCTION ABOUT SOFT DRINKS

Fast moving consumer goods (FMCG), are products that are sold frequently at relatively low cost. Though the absolute profit made on FMCG products is relatively small, they generally sell in large quantities, so the cumulative profit on such products can be large. Examples of FMCG generally includes a wide range of frequently purchased consumer products such as soft drink, toiletries, soap, cosmetics, toothpaste and powders, detergents etc, It also includes pharmaceuticals, consumer electronics, packaged food products, although these are often categorized separately.

Soft drinks industry

The soft-drink industry comprises companies that manufacture nonalcoholic beverages, carbonated mineral waters or concentrates and syrups for the manufacture of carbonated beverages. Naturally 9

occurring bubbling or sparkling mineral waters have been famous for thousands of years- the ancient Greeks believed that such waters had medicinal properties and bathed in them regularly, the Romans established resorts around mineral springs throughout Europe. In the 1500s the village of Spa in Belgium became very famous for its waters, which by the early 1600s were sold, in bottles, as far away as London, England. Development of the first man-made carbonated water is credited to Joseph Priestley, the British scientist who discovered oxygen. In year 1772 he invented a method of "pushing" carbon dioxide into water by dissolving it under high pressure, thus creating fairly long-lasting bubbles. The technique led to development of the soft-drink industry. By the very beginning of the 19th century, carbonated water was being made commercially in France and North America, shortly thereafter, flavors were added to enliven the taste. In the 1820s, small carbonated bottling operations were established in Canada, producing carbonated drinks in refillable bottles that were merchandised as medicinal elixirs, tonics.

The main principle of "pushing" carbon dioxide is still used, but now the water is first purified in a process known as "polishing." Cooled carbon dioxide is then injected at the pressures of 275-550 kilopascals. Some of the early drinks bottled in Canada were called Birch Beer, Ginger Beer, Sour Lemon, None-Such Soda Water. The first carbonated beverage bottles were sealed with corks held tightly in place with a wire binding. Because they had to be stored neck down so that the cork would not dry and allow carbonation to leak away, they were manufactured with rounded bottoms. The Hutcheson Spring Stopper replaced such closures. The crown cap was introduced in 1905 and improved versions are still widely used, although they are gradually being replaced, especially on larger containers, with enclosable screw caps. Other packaging innovations since the mid-1960s include canned carbonated beverages and nonreturnable glass bottles and containers made from rigid plastics. However, an effort is being made, often through provincial legislation, to increase the use of the returnable glass containers. The industry is regulated by federal and provincial agencies, three of the most important being CONSUMER AND CORPORATE AFFAIRS (it is responsible for the Consumer Packaging and

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Labeling Act), HEALTH CANADA (which administers both the Food and Drugs Act) and Environment Canada (which focuses on environmental matters). The introduction of diet-carbonated beverages has totally changed the industry's profile. Many years ago, in response to increasing consumer diet consciousness, the industry introduced the first successful sugar-free diet drinks. But here questions were raised about the safety of this additive and, based on existing scientific data, Health Canada banned its use in Canadian commercial FOODS AND BEVERAGES. This decision, estimated to have cost the industry more than $17 million, was a setback to diet-drink development. Now, a new sugar-free additive, aspartame, has been approved for the use in diet soft drinks, and the cyclamate situation is not expected to recur because aspartame consists of amino acids, which occur naturally. Just before the saccharin ban in 1977, diet drinks accounted for about 10% of the soft-drink market, following the ban the diet share dropped to about 3%, consisting of beverages partially sweetened with the small amounts of sugar. In the year 1982, the first full year that aspartame was used in Canada, diet drinks increased by 16.25% of total soft-drink sales, while the total soft-drink industry grew 10%. In 1987 total softdrink sales increased 7.3% over 1986, while diet soft-drink sales increased by 12.7%. This single development has encouraged the strong growth in the industry. Soft drink has been part of American lifestyle for more than 100 years. Many of todays soft drinks are the same as the first ones enjoyed in the 1800s. Soft drink production begins with creation of flavored syrup using a closely guarded company recipe. The syrup is mixed with purified water and then carbonated by adding carbon dioxide gas under pressure. This carbonation creates the tingle fizz that gives soft drinks a refreshing taste. Now for a closer look at soft drink ingredients Like other foods, the ingredients that are used in making soft drink are approved and closely regulated by the US Food and Drug Administration (FDA). All the ingredients used in soft drinks are found in a variety of other foods.

WATER
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Soft drink production starts with a pure source of water. Regular soft drink contains 90% water while diet soft drink contains up to 99% water Drinking water contains trace amount of various elements that affect its taste. You have probably noticed that top differ in carious regions of the county. Bottler use sophisticate filtering and other treatment equipments to remove any residual impurities and to standardize the water used to make soft drinks. Thats why your favorite soft drink tastes the name in New York as it dies in India.

CARBON DIOXIDE
A colorless and odorless gas, carbon dioxide is the essential characterizing ingredient in all carbonated beverages. It is given off when we breathe and is used by the plants to product oxygen. When dissolved in water, carbon dioxide imparts taste. For that reason natural sources of carbonated. Of effervescent, mineral water were once highly prized. These rare mineral water were once also believed to have beneficial medicinal properties. Efforts to make and sell artificial effervescent mineral water underway Europe and US by 1800. It was the innovative step of adding flavors to these popular soda water that gave birth to the soft drink beverages we enjoy today. In these days of soft drink manufacturing, carbon dioxide was made from sodium salts. This is why carbonated beverages were called, sodas or soda water. Today bottlers buy pure carbon dioxide as a compressed gas in the high-pressure cylinders. Carbon dioxide gas is absorbed into flavored soft drink in a carbonator machine just before the container is sealed. While under pressure and chilled, soft drink may absorb up to four times the beverage volume of carbon dioxide.

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FLAVORS
One of the most important ingredients in the soft drinks is flavoring. Most soft drink bottles mix many individual flavors to create distinctive tastes. Natural flavors in the soft drink come from spices, natural extracts and oils. Fruit flavored soft drink such as orange and lemon-lime often contains natural fruit extracts. Other flavors such as root beer and ginger are contain flavoring made from herbs and spices. There are also some artificial or man made flavoring used in soft drinks. Nature does not produce enough of some flavors to satisfy world demand. Also some flavors are limited geographically and seasonally.

COLORS
Many people do not realize important color is to taste perception. Color affects our psychological impression of food. If you dont believe it. Try eating a familiar food in the dark. The color used in the food and beverages comes both from natural and synthetic sources.

CAFFEINE
Caffeine is substance that occurs naturally in more than 60 plants including coffee beans, tealeaves, kola nuts and cocoa beans. In some cases, small amounts of caffeine are added to soft drinks as a part of the flavor profile. The amount of caffeine in soft drinks is only a fraction of that found in an equal amount of coffee or tea. Caffeine has a classic bitter taste that enhances other flavors. It has been part of almost every cola and pepper type beverage since they were first formulated more than 100 years ago and has been enjoyed in coffee, tea and chocolate beverages for centuries. Even though some people feel the effects of caffeine are harmful, scientific research has refused these claims. The ling history of caffeines use confirms that it is safe when

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consumed in moderation. For people who wish to restrict their caffeine intake, many caffeine free soft drinks are available.

ACIDULANTS
Similar to fruit juices and many other food products, most drinks are slightly acidic. Acidulates add a pleasant tartness to soft drinks for one or two common food acidulates (phosphoric acid and citric acid) occasionally; other acidulates such as malice acid is also used.

PRESERVATIVE
Soft drinks do not normally get spoiled because of their acidity and carbonation. However, storage conditions and storage tome can sometimes impact taste and flavor. For this reason some vs. contains small amounts of preservatives that are commonly used in many foods.

POTASSIUM
Potassium is another essential nutrients found in many natural and man made food ingredient like sodium, potassium exists naturally in drinking water and therefore, in soft drinks. Small amount of potassium are also found in some of the flavoring agents and other ingredients used in soft drinks.

SODIUM

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Because the name soda pop and soda water were associated with early soft drinks. Many people falsely believe that carbonated beverages contains significant amount of sodium. That is true. Sodium, the name form of various salts, is present in many natural and man made compounds. It is an essential nutrient responsible for regulating and transferring body fluids. As well as other important body functions. Although an adequate daily intake of sodium is necessary for good health, excessive consumption has been to high blood pressure in some people.

SWEETENERS
Non-diet soft drinks Most regular (non-diet) soft drinks are sweetened with either sucrose or high fructose corn syrup, (HFCS). A mixture of these sweeteners many also be used. Sucrose, the familiar sweetener in your sugar bowl, cines firm sugarcane or sugar beets.

1.2 FORMULATION OF SOFT DRINKS

1 START WITH PURE WATER! 15

Soft drinks begin with purified water (much clearer than the tap water you drink at home). The soft drink manufacturer filters tap water through fine, clean sand and gravel to get rid of any undissolved impurities that may pass through the finished drink and ensures that the water does not contain any unwanted particles.

2 ADD THE FLAVOUR Once the water is purified, flavourings are added. These are prepared from natural and nature identical sources and are added to a mixture of sugar and purified water to make a syrup. This forms the soft drink base. 3 NEXT STEP, ADD THE BUBBLES The purified water and syrup base are then blended together to form a 'still' drink and then mixed with carbon dioxide gas (CO2) in a machine called a carbonator.

4 FILLING THE BOTTLES After the drink has been carbonated, it is transferred under pressure to the filling machine. Here, the bottles or cans are filled and are then passed by conveyor belt to the sealing machine.

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5 THE FINAL STAGE The sealed bottles and cans are still quite cold at this stage, and if packed at this temperature, moisture which forms on the container because of condensation would cause the cartons to become wet and less manageable. To prevent this, the bottles and cans are passed through a hot water spray to bring them up to 'room' temperature.

6 LABELS & PACKAGING Most soft drink bottles have labels applied by a labeling machine. There are still some bottles, mostly returnable, which have the label information printed directly on to the glass. Cans also have the label printed on them, before they arrive at the soft drink manufacturing plant.

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1.3 HISTORY OF PEPSICO

PEPSICO is a world leader in convenient foods and beverages, with revenues of about $30 billion and over 153,000 employees. The company consists of the snacks business of Frito-lay North America and the beverage and food business of Pepsi co Beverages and foods, which includes PEPSICO Beverages North America (Pepsi-Cola North America and (Gatorade/Tropicana North America) and Quaker Foods North America. PEPSICO success is the result of superior products, high standards of performance, distinctive competitive strategies and high integrity of our people. PEPSICO beverages business was founded at the turn of the country by Caleb Brad ham, 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, Mountain Dew, Slice, Mirinda, 7up, Twister, Aquafina and Mug brands-account for nearly one-third of total soft drinks in the United States, a consumer market totaling about $60bn.

Pepsi-Cola was first made in New Bern, North Carolina in the United States in the early 1890s by pharmacist Caleb Brad ham. In 1898, Brads drink was changed to Pepsi- Cola and later trademarked on June 16, 1903. There are several theories on the origin of the word PEPSI. 18

The only two discussed within the current PepsiCo website are the following: Caleb Brad ham bought the name Pep Kola from a local competitor and changed it to PepsiCola. Pepsi-Cola is an anagram for Episcopal - a large church across the street from Brad hams drugstore. There is a plaque at the site of the original drugstore documenting this, though PepsiCo has denied this theory. Another theory is that Caleb Brad ham and his customers simply thought the name sounded good or the fact that the drink had some kind of pep in it because it was a carbonated drink, they gave it the name Pepsi. As Pepsi was initially intended to cure stomach pains, many believe Brad ham coined the name Pepsi from either the condition dyspepsia (stomach ache or indigestion) or the possible one-time use of pepsin root as an ingredient (often used to treat upset stomachs). It was made of carbonated water, gar, vanilla, rare oils, and kola nuts .Whether the original recipe included the enzyme Pepsi is disputed.

In 1903, Brad ham moved the bottling of Pepsi-Cola from his drugstore into a rented warehouse. That year, Brad ham sold 7,968 gallons of syrup. The next year, Pepsi was sold in sixounce bottles and sales increased to 19,848 gallons. In 1905, Pepsi received its first logo redesign since the original design of 1898. In 1906, the logo was changed again. In 1909, automobile race pioneer Barney Old-field endorsed Pepsi-Cola in newspaper ads as A bully drink...refreshing, invigorating, a fine bracer before a race.

In 1929, the Pepsi-Cola Company went bankrupt - in large part due financial losses \Assets were sold and Roy C.Megargel bought the Pepsi trademark. Eight years later, the company went bankrupt again. Pepsis assets were then purchased by Charles Guth, the President of Loft Inc. Loft was a candy manufacturer with retail stores that contained soda fountains. He sought to replace

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Coca-Cola at his stores fountains after Coke refused to give him a discount on syrup. Guth then had Lofts chemists reformulate the Pepsi- Cola syrup formula. Pepsi-Cola is a soft drink commonly called Pepsi, which is produced and manufactured by PepsiCo. It is sold worldwide in stores, restaurants and from vending machines. The drink was first made in the 1890s, by pharmacist Caleb Brad ham. The brand was trademarked on June16, 1903. There have been many Pepsi variants produced over the years, including Diet Pepsi, Pepsi Max, Pepsi blue, Pepsi Gold, Pepsi Jazz and Pepsi Nex

PURCHASE AND CONSUMPTION PATTERN

Industry research suggests that the purchase of the soft drink is unplanned, i.e. sometimes it is more and sometimes it is less depending on the demand in the market, the schemes that are provided to the retailers, the displays provided, and the incentives given and on the relationship of the salesman and the retailers.

The sale of soft drinks is a seasonal affair. The sale increases tremendously during the summer season and falls down during the winter season. But we can say undoubtedly that the demand of Pepsi is round the year either big or small because it not only satiates the thirst but consuming Pepsi is also a fashion among the youngsters and a status symbol among them.

FORMULATION OF PEPSI
Water: the water is available through the municipal supplies or through the borings. Water This water is then treated by reverse osmosis process to obtain germ free water. The water is also treated with some chemicals so that the water that is obtained is pure and ready for consumption. The water is also passed through the sand in order to filter it.

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This water thus obtained is soft and can be used for manufacturing process of the carbonated soft drinks. The same water is also used for washing of the used bottles. Sugar syrup preparation: The next step is the preparation of the sugar syrup, which is preparation: further used to prepare the final concentrated syrup. In this the sugar is added to the germ free water and heated to about 85 degrees of temperature in a steam jacketed stainless steels tank of adequate capacity with an protester, so that the sugar gets well dissolved in the syrup. The solution is boiled for about 20 minutes so that the syrup gets bit thick. This also kills the germs present in the water; the syrup is then filtered through the filter press at a high speed so that further impurities can be removed from the syrup. Then this syrup is cooled to a definite temperature with the help of a S.S (stainless steel) Plant Heat Exchanger. Processed syrup: In the preparation of the processed syrup, additional water is added to the raw syrup in the correct quantity along with some essence. The solution is mixed thoroughly with a protester provided in the S.S tank and allowed to mature according to the specified time limit. This time differs for each flavor. Beverage preparation: In this step the ready syrup is passed through the intermix unit where more water is added to the syrup to prepare the final product. Now this beverage is chilled to a very low temperature and is pumped into the saturator carbonator. Carbonator is the stainless steel vessel consisting of a number of S.S film plates. This vessel is a pressure vessel where high pressure is maintained, so that the C02 gets well mixed with the cold water. The S.S plates forms a very thin film of the beverage on the plates. After this the beverage is filled in the glass bottles under high pressure, so that no air remains inside the bottles because this can spoil the soft drink. Filling: Filling of the beverage in the bottles is done through the automatic counter pressure filters, which fills the bottles at a high speed, and the bottles are crowned with the caps automatically.

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Cleaning of bottles: Washer, which consists of the soaking compartments. These compartments contain caustic soda and a number of jets where soft and hot water is dispensed. Bottles, which come back from the markets, are washed with the help of bottle caustic soda solutions are used to clean the bottles. These cleaned bottles are then inspected before they go for refilling. They are passed through the bottle conveyer process. Then they are passed through the Lim-Light inspection machine and then through the Mit-Mirror machine for finding out the cracks. After all these inspection the bottles are sent for refilling .The bottles are again checked and then packed in the group of 24.

Quality Control (QC): The success of any industry depends on the quality of the product it provides. Therefore quality measurements are done on each step in order to ensure that the product that finally reaches the consumer is fit for consuming. The packed bottles are checked for the gas content, sugar content, organic and for the microbiological quality. Here the quality invariable remains the constant because of the continuous on - line checking.

COMMON TERMS USED IN PEPSICO

RGB (refilled glass bottles): This term is generally used for the 300ml and 200 ml glass bottles. BANK: This term refers to the entire bottling group. CAN: An aluminum container in which the beverages are packaged for sale. CRATE: A durable box made of durable plastic (thermostatic plastic) which is used to contain the bottles. PET: A durable and disposable plastic bottle which can contain up to 2.5 liters of beverage. 22

CONSUMER: Someone who consumes the products. COOLER: Mechanically refrigerated unit that cools the glass bottles and the pet bottles. CROWN: The steel closure, which seals the bottles. CUSTOMER: A retailer or dealer who sells or serves products directly to the consumer. ROUTE: The sequence of shops and the retail shops that the salesman has to cover every day in order to complete his job. WHOLESALER: Business entity, which buys products from the producers for resale to the retailers. They have their own defined routes, the salesman from the company are not allowed to cover them.

1.4Company profile of Pepsi

Pepsi are continuously striving for synergy between technology, system and human resources to provide product and service that meets the quality, performance and price aspirations of our customer while doing so, we maintain the highest standards of ethics and societal responsibilities innovate product and processes, and develop team that keep the momentum going to take the company to excellence in the new millennium.

Formation of Pepsi
NEW BERN, NORTH CAROLINA COAST on the spot in his pharmacy, Caleb bard ham invented brads drink which later he planted as Pepsi-cola. Donald M. Kendall. President and Chief Executive Officer Of Pepsi-Cola and Herman W.Lay, Chairman and Chief Executive Officer of Frito-Lay found 1965 Pepsi co, Inc., through the merger of two companies. Caleb Brad ham, a New Bern, N.C. pharmacist, created Pepsi Cola in the late 23

1890. Frito- lay, Inc. was formed by the 1961 merger of the Frito Company, founded by Elmer Doolin in 1932, and the H.W. Lay Company, founded by the new company; Donald M. Kendall is president and chief executive officer. The new company reports sales of $510 million and has 19,000 employees. Major products of the new company are Pepsi-Cola Company --- Pepsi Cola (formulated in 1898), Diet Pepsi (1964) and Mountain Dew (introduced by the Corporation in 1948). Frito-Lay, Inc.b Fritos brand corn chips (crested by Elmer Doolin in 1932) Lays brand Potato chips (created by Herman W. Lay in 1938), Cheetos brand cheese flavored snacks (1948), Ruffles brand potato chips (1958) and Rold Gold brand pretzels (acquired 1961) Mountain Dew launches its first campaign Yahoo Mountain Dew---- itll tickle your innards. PepsiCo engaged with various kind of operations .So some of them is being focused in this project such as: The three main teams in the in the production and the distribution of the carbonated soft drinks are the concentrate producers, the bottlers and the retailers who are actually responsible for the sales of the product. The concentrate producers produce the concentrate and them sell it to the bottlers, who adds a sweetener to the carbonated water and then pack it in the bottles and cans. These bottlers can be either the Pepsi itself or the franchisees who work on the behalf of Pepsi. One half of the sale of the Pepsi is through the company owned bottlers (COBO) and other half of the sale is through the franchisees bottlers (FOBO). FOBOs had the right to the product and then sells it in the defined territory and is not allowed to market the competitive brand. Then through the distribution channel the product reaches to the retailer who finally sells the product to the consumer. The principle retail outlets for the CSD are the supermarkets, convenience stores, fountain services and thousands of small outlets.

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YEAR
1969

INNOVATIONS
Bold, modem Pepsi-Cola packing using red, white and blue is introduced. Youve got a lot to live, Pepsis got a lot to give, becomes the advertising theme Mountain Dew changes its slogan to Get that Barefoot Feel in Drink in Mountain Dew.

1970

PepsiCo moves from New York City to new world headquarters in Purchase, N. Y. The new corporate headquarters feature a building by one Americas foremost architects, Edward DURRELL stone (1902-1978) set on a campus of 144 acres amid an outdoor sculpture garden. Pepsi introduces the industrys first two-litter bottle. Pepsi is the first company to respond to consumer preference with lightweight, recyclable, plastic bottles.

1972

Mountain Dew, acquired by Pepsi- Cola in 1964, switches its advertising and packing graphics from to action oriented scenes. Sales climb and Mountain Dew will become one of the 10 best selling soft drinks in the United States. Don Kendall announces agreement Pepsi-Cola the first foreign product sold in the then U.S.S.R. PepsiCo is given exclusive rights to 25

import Stolichnaya Russian vodka in the country. 1974 PepsiCo sales pass the $2 billion mark PepsiCola becomes the first American consumer product to be produced, marketed and sold in the firmer Soviet Union.

1980

PepsiCo Food Service International (PFSI) is formed to focus on overseas development of restaurants. PepsiCo now has 111,000 employees first presentation of the international Donald M. Kendall Bottler-of the-year Award.

1981 1982

PepsiCo passes $7 billion in sales. Pepsi Free and Diet Pepsi Free, the first major brand China. caffeine-free colas, are introduced Inauguration of the first Pepsi-Cola operation in

1985

PepsiCo is now the largest company in the beverages industry. The revenues of more than $7.5 billion, more than 137,000 employees. Pepsi-Cola products are available in nearly 150 countries and territories around the world. Snack food operations are in 10 international markets.

1986

PepsiCo purchases 7-UP International, the third largest franchise soft drink operation outside the

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United States. PepsiCo passes $10 billion in sales. Dew it Country Cool, becomes new slogan for Mountain Dew. Diet Pepsi Cola acquires Mug Root Beer. Pepsi gets a new logo. Pepsi Cola sponsors the first Westernproduced consumer commercial in the Soviet Union, appearing during the Goodwill Games. 1988 Pepsi Cola international enters a landmark joint venture agreement in India. 1989 PepsiCo enters top 25 of fortune 500 ranking with sales of $15.4 billion, it is number 23. 1990 The company has more than 300,000

employees. 1991 PepsiCo acquires an equity interest in Wedel SA, the leading manufacturer of chocolate and confectionary in Poland Snacks operation in 23 countries. 1992 Pepsi-Cola introduces a new logo, its eighth in 93 years. Advertising features rap singer MC Hammer.

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1994

Pepsi-Cola is the first major soft drink maker to begin producing and distributing its product in Vietnam. Pepsi-Cola launches its sports drink All Sort. It is sold in 2001. Pepsi Cola International acquires Indian company, its first big bottling plant in Bombay. Pepsi Co sales reach $ 30.4 billion. There are 470,000 employees worldwide, making PepsiCo the third largest employer Pepsi-Cola introduces Nothing else is a Pepsi theme line.

1995 Pepsi-Cola is top ad scorer in Super Bowl. Mountain Dew sponsors the Grammy Awards. Theme line is Been There, Done That, Tried that. The Pepsi Lipton Tea Partnership debuts new ad campaign emphasizing, Theres only one Original. 1996 Pepsi -Cola introduces Smooth Moos

Smoothies, a line of low fat dairy shakes. 7UP International launches 7UP Ice Cola, a new clear cola. Mountain Dew launches a massive beeper network called The Mountain Dew Extreme

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Network. Pepsi Co, Inc. and Lucas film Ltd. announce the largest promotional alliance in entertainment history, linking existing and future Star Wars series with PepsiCo beverages, snack foods and restaurant brands worldwide. Pepsi Cola and MTV establish a partnership to develop events. 1997 Pepsi-Cola introduces new advertising international programming, cross promotions, marketing tie-ins and specials

campaign with the theme Generation Next. Pepsi-Cola North American bottling operations become a separate unit called The Pepsi-Cola Bottling Co. National rollout of Aquafina bottled water. Pepsi-Cola celebrates 100th Anniversary with first worldwide bottlers conference, held in Hawaii. The event is held during the same time as first bottlers conference. 1998 Pepsi -Cola introduce two liter plastic bottle with built in grip handle that makes it easier to grip and pour. Pepsi introduce new look called the Globe which prominently features a 3- dimensional

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Globe against a blue ice backdrop. PepsiCo acquires Tropicana Products from Seagram Company Ltd., the biggest acquisition ever undertaken by PepsiCo. Anthony Rossi founded Tropicana in 1947.Its major brand is Tropicana Pure Premium Juices. In March, the Pepsi Bottling Group, the worlds largest Pepsi bottler, begins trading on the New York Stock Exchange. It is listed under the symbol PBG. The $3.2 billon public offering is among the biggest initial public offerings in stock market history. 1999 Pepsi launches The Joy of Colas advertising campaign 2000 Pepsi-Cola revivers its Pepsi Challenge advertising campaign. Challenge includes Pepsi One Diet Coke as well as cola. Pepsi-Cola teams up with Yahoo Inc. the biggest web navigation company, in a multimedia marketing campaign aimed at teens and young adults. Pepsi-Cola launches Sierra Mist a caffeinefree, lemon/lime soda. Pepsi-Cola Company launches Dole single server juices in vending machines, coolers and 2001 other retail outlets throughout the United States. Pepsi-Colas flagship brand will have NEW

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TAGLINE, The Joy of Pepsi. Pepsi-Cola launches the bold new Mountain Dew code Red nationwide. It is Mountain Dews first line extension since the introduction of the Diet Mountain Dew in 1988. 2002 PepsiCo introduces a new corporate logo. Diet Sierra Mist is introduced. Diet Pepsi has a new look. Aquafina debuts new line of great-tasting enhanced water. Aquafina essentials target active, health-conscious adults in four lightly sweetened varieties including B-Power, Calcium+, Daily C and Multi-yin 20-oz bottles. Pepsi Brand Pepsi has a new look. PepsiCo publishes Health and Wellness

Philosophy. (On pepsico.com) PepsiCo introduces Marathon Kids, a program that encourages kids and their families to be more physically active, the program debuts in Dallas, TX. 2003 Pepsi-Cola launches Sierra Mist nationally. Pepsi announces plans to launch Mt. Dew Livewire, an orange drink, this summer PepsiCola sings an exclusive four-year sponsorship 31

deal with the Canadian Hockey Association, making Pepsi the official soft drink. Pepsi announces four-year sponsorship

agreement with the UK Football Association. Pepsi Stuff Campaign kicks-off in Canada. PepsiCo creates PepsiCo International, the business that will unite all international snack, beverages and food units in an effort to drive faster growth and improved profitability around the world.

Pepsi-Cola to launch Pepsi Edge, the first fullflavored 2004 cola with 50% less sugar, carbohydrates and calories than regular cola. PepsiCo again launched Mirinda Lemon (ginger 2005 flavored). A new brand was launched that was Lipton Tee & Mirinda Black Berry was introduced.

2006

PepsiCo launched Pepsi Caf chino & a new shape of 7Up is given i.e.7Up Curry Bottle.

2007

PepsiCo launched a new variant of Miranda to make it more orange. PepsiCo also launched Pepsi gold in this year. 32

2008

PepsiCo introduced a new range of orange juice which is known as Tropicana Twister.

BOARD OF DIRECTORS
PepsiCo is the company full of strong, talented individuals starting with the company leadership. Get to know the inspiring people helping lead the PepsiCo on its 'Performance with Purpose' journey. 33

Indra K. Nooyi Chairman and CEO of PepsiCo

John Compton CEO of PepsiCo Americas Foods

Massimo d'Amore CEO of PepsiCo Beverages America

Eric Foss CEO of Pepsi Beverages Company

Zein Abdalla CEO of PepsiCo Europe

Saad Abdul-Latif CEO of PepsiCo Asia, Middle East, Africa

A. Salman Amin Executive Vice and Marketing of PepsiCo

Mitch Adamek President Sales Senior Vice and Chief Procurement officer

MISSION AND VISION: Mission

Our mission is to be the world's premier consumer Products Company focused on convenient foods and beverages. We seek to produce financial rewards to investors as we provide opportunities for

34

growth and enrichment to our employees, our business partners and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity.

Vision
"PepsiCo's responsibility is to continually improve all aspects of the world in which we operate environment, social, economic creating a better tomorrow than today." Our vision is put into action through programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company. Performance with Purpose: At PepsiCo, we are committed to achieving business and financial success while leaving aositive imprint on the society delivering what we call Performance with Purpose.Our approach to superior financial performance is the straightforward drive shareholder value. By addressing social and the environmental issues, we also deliver on our purpose agenda, which consists of the human, environmental, and talent sustainability. PepsiCo Values & Philosophy: Our Values & Philosophy are a reflection of the socially and environmentally responsible company we aspire to be. They are the foundation for the every business decision we make.

COMMITMENT
We are committed to delivering the sustained growth through empowered people acting responsibly and building trust. 35

Sustained Growth is fundamental to motivating and measuring our success.

Our quest for

sustained growth stimulates innovation, places a value on results, and helps us understand whether today's actions will be contribute to our future. It is about the growth of people and company performance. It prioritizes both making a difference and getting the things done. Empowered People means we have the freedom to act and think in ways that we feel will get the job done, while adhering to processes that ensure proper governance and being mindful of company needs beyond our owns. Responsibility and Trust forms the foundation for the healthy growth. We hold ourselves both personally and corporately accountable for everything we do. We must earn the confidence others place in us as individuals and as a company. By acting as good stewards of the resources entrusted to us, we strengthen that trust by walking the talk and following through on our commitment to succeeding together

GUIDING PRINCIPLES:

36

We must always strive to: Care for our customers, our consumers and the world we live in. we are driven by the intense, competitive spirit of the marketplace, but we direct this spirit toward the solutions that benefit both our company and our constituents. Our success depends on the thorough understanding of our customers, consumers and communities. To foster this spirit of generosity, we go the extra mile to show we care. Sell only products we can be proud of. The true test of our standards is our own ability to consume and the personally endorse the products we sell. Our confidence helps ensure the quality of the products, from the moment we purchase ingredients to the moment it reaches the consumer's hand. Speak with truth and candor. We tell the whole story, not just what's convenient to our individual goals. In addition to being the clear, honest and accurate, we are responsible for ensuring our communications are understood. Balance short term and long term. In every decision, we weigh both short-term and longterm risks and benefits. Maintaining this balance helps sustain our growth and ensures our ideas and the solutions are relevant both now and in the future. Win with diversity and inclusion. We embrace people with diverse backgrounds, traits and the ways of thinking. Our diversity brings new perspectives into the workplace and encourages innovation, as well as the ability to identify the new market opportunities. Respect others and succeed together. Our mutual success depends on the mutual respect, inside and outside the company. It requires people who are capable of working together as part of a team or informal collaboration. While our company is built on individual excellence, we also recognize the importance and value of teamwork in turning our goals into accomplishments

POPULAR SLOGANS

1987

America's Choice 37

1989 1992 1993 1995 1997 1998 1999 2000 2003 2003-2005 2005-2006 2006.2007 2007-2008 2008-2009 2010

A Generation Ahead Gotta Have It Be Young, Have Fun, Drink Pepsi Nothing Else is a Pepsi Generation Next Same Great Taste The Joy of Cola The Joy of Pepsi Pepsi. It's the Cola "Yeh Pyas Hai Badi" "An ice cold Pepsi. It's better than sex Yeh PYAAS Hai BADI!! Yeh DIL Mange MORE!! Yeh hai Youngistaan Meri Jaan!! Yeh Hai Youngistaan Ka WOW!!

1.5HISTORY OF COCA-COLA
The Coca-Cola Company was first established in 1886 by Dr John Styth Pemberton. Today, the company is the world's leading manufacturer in the beverage industry, operating globally in more 38

than 200 countries with its head office located in Atlanta, USA. It produces more than 300 beverage brands and over 1.06 billion drinks are consumed per day. In India, Coca-Cola was the leading soft-drink till 1977 when govt. policies necessitated its departure. Coca-Cola returned to India in 1990 and over the past nineteen years has captured the imagination of the nation, building strong associations with cricket, the thriving cinema industry, music etc. Coca-Cola has been very strongly associated with cricket, sponsoring the World Cup in 1996 and various other tournaments, including the Coca-Cola Cup in Sharjah in the late nineties

Coca-Cola, the product that has given the world its best-known taste was born in Atlanta, Georg ia, on May 8, 1886. Coca-Cola Company is the worlds leading manufacturer, marketer and distributor of non-alcoholic beverage concentrates and syrups, used to produce nearly 400 beverage brands. It sells beverage concentrates and syrups to bottling and canning operators, distributors, fountain retailers and fountain wholesalers. The Companys beverage products comprises of bottled and canned soft drinks as well as concentrates, syrups and not-ready-to-drink powder products. In addition to this, it also produces and markets sports drinks, tea and coffee. The Coca-Cola Company began building its global network in the 1920s. Now operating in more than 200 countries and producing nearly 400 brands, the Coca-Cola system has successfully applied a simple formula on a global scale: Provide a moment of refreshment for a small amount of moneya billion times a day. The Coca-Cola Company and its network of bottlers comprise the most sophisticated and pervasive production and distribution system in the world. More than anything, that system is dedicated to people working long and hard to sell the products manufactured by the Company. This unique worldwide system has made The Coca-Cola Company the worlds premier soft-drink enterprise. From Boston to Beijing, from Montreal to Moscow, Coca-Cola, more than any other consumer product, has brought pleasure to thirsty consumers around the globe. For more than 115 years, Coca-Cola has created a special moment of pleasure for hundreds of millions of people every day. The Company aims at increasing shareowner value over time. It accomplishes this by working with its business partners to deliver satisfaction and value to consumers through a worldwide system of 39

superior brands and services, thus increasing brand equity on a global basis. They aim at managing their business well with people who are strongly committed to the Company values and culture and providing an appropriately controlled environment, to meet business goals and objectives. The associates of this Company jointly take responsibility to ensure compliance with the framework of policies and protect the Companys assets and resources whilst limiting business risks. The biz.system of coca-cola in India directly employs approximately 6,000 people, & indirectly creates employment for many more related industries throw our wash procurement, supply and distribution system. The vast Indian operations comprise 25 companies owned bottling operations & 24 franchises owned bottling operations. The apart a network of contract packers also mfg. a range of the product for company. On the distribution front, 10 tone trucks, open-bay three wheelers that can navigate the narrow alleyways of Indian cities, ensure that our product available in each corner of the country. The coca cola is responsible for the mfg. distribution & sales of product across the country. By the 21st century, Coca Cola history took another leap in the market. In 2005, the company launched "Diet Coke", sweetened with artificial flavors. Later in 2005, it announced "Coca Cola Zero", sweetened with aspartame and acesulfame potassium. Since then, the company has produced other products containing the same Coca-Cola formula with minor differences. Coca Cola is now being sold around the world, in more than 200 different countries. The CocaCola company now sponsors an assortment of events, including the "Olympic Games", and "NASCAR". In England, it is the primary sponsor of "The Football League". It is also featured in several television shows including "The Gods Must Be Crazy." Coca Cola history has come a long way since Pemberton invented the original recipe, and continues to grow by leaps and bounds. It is no surprise that it is one of the leading soft drinks of the market.

40

1.6 Company profile of Coca-cola BOARD OF DIRECTORS

Muhtar Kent Chairman of the Board and Chief Executive Officer The Coca-Cola Company

41

Herbert A. Allen President and Chief Executive Officer Ronald W. Allen Advisory Director, former Chairman of the Board, President, and Chief Executive Officer

Cathleen P. Black Chairman Hearst Magazines

Barry Diller Chairman of the Board and Chief Executive Officer Alexis M. Herman Chair and Chief Executive Officer New Ventures, LLC Donald R. Keough Non-Executive Chairman of the Board Allen & Company Incorporated and Allen & Company, LLC Maria Elena Lagomasino Chief Executive Officer

PRODUCT LINE

The Coca-Cola Company has a no of brands like Thums up, Sprite, etc. But if we talk about Coca Cola as a product it has sub products like Diet Coke, Caffeine Free Coke, Cherry Coke Coca-Cola Zero, Vanilla Coke and special editions with lemon and with lime, and even with coffee. Coca Cola Company deals mainly in soft drink industry and these are some of its major brand. It also deals in soda and mineral water through the brand name Kinley.Multi branding is the 42

is the branding strategy used by Coca Cola company for its different products.Know the most recognized word on the planet after OK! Among the soft drinks Fanta and Sprite become successful along with the major brand Coca Cola and Diet Coke. In key markets, the company has created new packaging sizes to satisfy consumer demand

MISSION AND VISION:

Our mission statement is to maximize shareowner value over time. In order to achieve this mission, we must create value for all the constraints we serve, including our consumers, our customers, our bottlers, and our communities. The Coca Cola Company creates value by executing comprehensive business strategy guided by six key beliefs:

1. 2. 3. 4. 5. 6.

Consumer demand drives everything we do. Brand Coca Cola is the core of our business We will serve consumers a broad selection of the nonalcoholic ready-todrink We will be the best marketers in the world. We will think and act locally. We will lead as a model corporate citizen.

beverages they want to drink through out the day.

43

The ultimate objectives of our business strategy are to increase volume, expand our share of worldwide nonalcoholic ready to drink beverages sales, maximize our long-term cash flows, and create economic value added by improving economic profit.

The Coca Cola system has more than 16 million customers around the world that sells or serves our products directly to consumers. We keenly focus on enhancing value for these customers and helping them grow their beverage businesses. We strive to understand each customers business and needs, whether that customer is a sophisticated retailer in a developed market a kiosk owner in an emerging market.

There are nearly 6 million people in the world who are potential consumers of our companys product. Ultimately, our success in achieving our mission depends on our ability to satisfy more of their beverage consumption demands and our ability to add value for customers. We achieve this when we place the right products in the right markets at the right time.

OUR VISION
Our vision serves as the framework for our Roadmap and guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable, quality growth. PEOPLE: Be a great place to work where people are inspired to be the best they can be. PORTFOLIO: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy 44

people's desires and needs. PARTNERS: Nurture a winning network of customers and suppliers, together we create mutual, enduring value. PLANET: Be a responsible citizen that makes a difference by helping build and support sustainable communities. PROFIT: Maximize long-term return to shareowners while being mindful of our overall responsibilities. PRODUCTIVITY: Be a highly effective, lean and fast-moving organization. Our Winning Culture defines the attitudes and behaviors that will be required of us to make our 2020 Vision a reality.

LIVE OUR VALUES

Our values serve as a compass for our actions and describe how we behave in the world.

Leadership: The courage to shape a better future Collaboration: Leverage collective genius Integrity: Be real Accountability: If it is to be, it's up to me Passion: Committed in heart and mind Diversity: As inclusive as our brands Quality: What we do, we do well

FOCUS ON THE MARKET

Focus on needs of our consumers, customers and franchise partners 45

Get out into the market and listen, observe and learn Possess a world view Focus on execution in the marketplace every day Be insatiably curious

WORK SMART

Act with urgency Remain responsive to change Have the courage to change course when needed Remain constructively discontent Work efficiently

ACT LIKE OWNERS

Be accountable for our actions and inactions Steward system assets and focus on building value Reward our people for taking risks and finding better ways to solve problems Learn from our outcomes -- what worked and what didnt

COMMITMENT Our commitments are focused where we have the most opportunity to make a difference waterstewardship, sustainable packaging, energy management and climate protection.

46

Our community water programs are designed to support healthy watersheds and sustainable programs to balance the water used throughout our production process. Learn about our wide range of locally relevant initiatives and download our community water partnership reports. Our commitment to responsible citizenship also includes conservation of natural resources and protection of the soil, water and climate required to sustain life on earth. Read about the opportunities within our global supply chain to develop and encourage more sustainable practices to benefit suppliers, customers and consumers.

SOME POPULAR SLOGANS OF COCA COLA

1986

Catch the wave (Coca-Cola) Red White & You (Coca-Cola classic Cant Beat the Feeling Cant Beat the Real Thing Always Coca-Cola Taste it all Play Red Hot Summer Play Red Hot Summer Again Enjoy Life is Good

1989 1990 1993 1994 1995 1996 2001

2003

Real 47

2005

Welcome to the Coke side of life Make It Real

2007

Live on the coke side of life

2009

Open Happiness

2010

Open Happiness

CHAPTER 2
48

RESEARCH METHODOLOGY

2.1 MEANING OF RESEARCH

Redman and Mory define research as a systemized effort to gain new knowledge. Some people consider research as a movement, a movement from the known to the unknown. Research is an academic activity and as such the term should be used in a technical sense. According to Clifford Woody, research comprises defining and redefining problems, formulating 49

hypothesis or suggested solutions; collecting, organizing and evaluating data; making deductions and reaching conclusions; and at last carefully testing the conclusions to determine whether they fit the formulating hypothesis. Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically. In it we study the various steps that are generally adopted by a researcher in studying his research problem along with the logic behind them. It is necessary for the researcher to know not only the research methods or techniques but also the methodology.

2.2 OBJECTIVES OF RESEARCH

Research in common language refers to a search for knowledge. One can alsodefine research as a scientific and systematic search for pertinent information on specific topic. In this era of cutthroat competition it is of vital importance for any company have a strong foothold in the product market and having a strong distribution network, effective sales promotion and 50

advertising strategies. These pricing policies should also be such which will help them in achieving their targets. Ever company strives to earn profit through maximizing their sales according to varying needs of their customers. The same applies to the soft-drink company also. Both the two companies PepsiCo, Coca-Cola (I) Ltd. is aiming to rise well above their competitors. So the researcher was entrusted to carry out marketing overview about some of the most usually demand soft drink. The objective of the research is to gauge the image of PepsiCo Vis-a --Vis Coca-Cola [I] Ltd. The research was planned to find the effect of the different brand position strategies adopted from time to time on audiences perception. It is believed that the audience is perplexed by almost same appeal by both the companies in their recent advertisements

FOLLOWING ARE THE OBJECTIVES : To identify new avenues and ways to project the image of their company. To identify the difference in their tone, look and style of communication. To do a comparative study of who comes up with more exciting and innovative offers.

2.3 SIGNIFICANCE OF RESEARCH

All process is born of inquiry. Doubt is often better than overconfidence, for it leads to inquiry and inquiry leads to invention. Is a famous Hudson Maxim in context of which the significance of research can well be understood. Increased amounts of research make progress possible. Research inculcates scientific and inductive thinking and it promotes the development of logical habits of thinking and organization. 51

The role of research in several fields of applied economics, whether related to business or to the economy as a whole, has greatly increased in modern times. The increasing complex nature of business and government has focused attention on the use of research in solving operational problems. Research, as an aid to economic policy, has gained added importance, both for government and business.

2.4 DATA COLLECTION SOURCE

Data can be collected both from primary as well as from the secondary source. The data collected for this project has been taken from the secondary source. Secondary Data: Any data, which have been gathered earlier for some other purpose, are secondary data in the hands of researcher. Those data collected first hand, either by the researcher or by someone else, especially for the purpose of the study is known as primary data. 52

The data collected for this project has been taken from the secondary source.

Sources of secondary data are :Internet Magazines Publications Newspapers Brouchers

2.5 LIMITATIONS OF PROJECT

Reliability is not guaranteed. It does not permit progression of formulating research question to designing methods for answering the question. The Secondary researcher can not engage in making observations and developing concepts. The source of the data is not guaranteed 53

 Data inaccessible not presented in useful form There may be biases in the data that you don't know about. Its answers may not exactly fit your research questions.

CHAPTER-3

MARKETING STRATEGIES
54

MARKETING

3.1 INTRODUCTION

Marketing deals with identifying and meeting human and social needs. One of the shortest definitions of marketing are meetings needs profitably. The 21st century is the era of Advertising, Marketing and Sales Production; Marketing is to convert social needs into profitable opportunities. As it is said Marketing thinking starts with the human needs and wants. Apart from basic necessities of air, water, shelter and clothing, every person has strong desire for recreation and entertainment. They have strong preference for particular brand of basic and services. Marketing serves as the link between the societys needs and its pattern of Industrial 55

response. Beverage industry is one of the fast growing industries in India. We can divide Beverages into two sections i.e. Alcoholic & Non-alcoholic. The non-alcoholic drinks are soft drinks that can be further classified Cola, Lemon, Orange, Mango and Apple segment.

3.2 MARKETING MIX OF PEPSICO:The tools of marketing mix are combined in such a manner that they give maximum mileage to the product from the factory to the consumers hand. Product Price Place Promotion

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PRODUCT

People satisfy their needs and wants with products and services, a product is anything that can be offered to a market to satisfy a need or want- The concept of product is not limited to physical objects - anything capable of satisfying a need can be called a product. Haidri Beverages is the company that has taken up the franchise to produce Pepsi for the area of Maharashtra and Delhi. The production capacity of the plant is to produce 73,000 cases of 24 bottles of 250-ml. For this reason the company has three lines of production to fulfill the ever-growing demand. Pepsi is one of the core products of the organization and the company puts in a lot of effort to retain its image through its highly professional team. The members of the organization work day and night making every possible effort to attain the organizational goals.

PRICE
Price is the amount of money the customers are willing to pay to obtain that particular product. Providing quality products at the lowest possible price had always been one of the main concerns of Pepsi. One of the ways by which the company has been able to assist this effort is by increasing the use of inexpensive and recyclable plastic bottles. The government policy, at times, makes a lot of difference as the government may increase the freight charges, the prices of glass, or the prices of steel. Thus the overall price of the product also gets affected. The price of Pepsi Cola is very reasonable as compared to other drinks and the management makes every effort to make the product at the lowest possible cost but the highest quality.

Pepsi wants its product to be available to all PRICING STRUTCTURE:-

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QUANTITY 200 ML 300 ML 330 ML(CAN) 500 ML 1 LIT 2 LIT

PRICE 9 12 20 24 37 60

PLACE
Place includes the company activities that make the product available to target consumers. Pepsi Cola is placed in the market according to the extent of the target market located in that particular geographical area. Haidri Beverages place their product in the market with the help of its indirect distribution network. The retail stores are spread all around the franchised area in order to ensure the availability of the product all the year round. The major retail stores located in Maharashtra and Delhi are in the Blue Area, Jinnah Super Market, Super Market, and in almost every sector of Islamabad. The entire DELHI Cantonment and the entire city as well have many retail outlets where Pepsi is available in abundance. The distribution network also works according to the promotional campaign or the season. For example, in the cricket season the company tries to make the product available in areas where Cricket is being played. Pepsi covers almost 95% of total area. It sells through local retailers. It is available everywhere. 58

PROMOTION
Promotion means activities that communicate the merits of the product in order to persuade the target customers to buy it. Promotion plays a vital role in the success or failure of a product. Promotion of the right product at the right time is an ideal situation for a company. Pepsi is one of those products on which the franchisers spend millions of Dollars/Rupees for its promotion. Haidri Beverages invest a huge amount of money on the promotional campaigns of Pepsi. There are different ways of promoting a product through retailing, personal selling, and advertising. The company strongly emphasizes on advertisements as the other two methods area not much effective in attracting the attention of their target audience. Huge amount of money spend on advertisement on T.V, Magazines, And Banners. It sponsors award functions and sports activities.

3.3 MARKETING MIX OF COCA COLA

Introduction
According to the Peter Drucker Business has two main functions marketing and creativity. Marketing and creativity produce results and rest is cost. Marketing is total system of business activities designed to plan, price, promote and distribute want to satisfying products to target market to achieve organization objective. In broader sense, marketing can occur any time one social unit (person or organization) strive to exchange something to value with another social unit. Thus the essence of marketing is transaction or exchange. In this broad sense, marketing consists of facilitate exchange intended to satisfy human needs or wants.

59

Coca-Cola internationally developed a very strong and effective marketing system and creates so many innovative marketing strategies, and got number one position is beverages business. In Pakistan, they have very poor marketing; this is why they have lost a great market share since the last ten year. The SHAHI BEVERAGES marketing department consists of one marketing manager who is responsible for the marketing activities. He has got important position in the companys set-up because all the responsibility of product image its promotion etc lies on the shoulder of marketing manager, who is assisted by other sale managers . One is base sale manger, who is responsible for Rawalpindi area and around the city. While out station sales manager is responsible for the area outside city. These sale managers are further assisted by Assistant sale managers. They supervise the activities of sale officers. These sale officers play a key role between retailers and the company.

PRODUCT
Product is set of tangible and intangible attributes, which may include packaging, color, price, quality & brand, plus the sellers services, and reputation. A product may be a good, a services, place, person, or idea. Product Mix Product Mix is a set of products offered by a company. Coca-Cola International SHAHI beverages manufactures and markets a lot of products internationally but in Pakistan it manufactures and market only three flavors. The brand names of the product are COCA-COLA, FANTA and SPRITE and it is also called product Mix of SHAHI beverages.

Product Line

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A broad group of products intended for essentially similar uses and having similar physical characteristic.

PRICE AND PRICING STRATEGY

Price is the amount of money or other items with utility needed to acquire a product.Price is the basic regulator of the economic system because it influences the allocation of factors of production (labor, land, capital). To reduce the risk of government intervention, Coca-Cola establishes price in a manner and at a level, that consumers and government officials consider it socially responsible. As the image of quality of Coca-Cola as well developed in the consumer mind so mostly they establish their pricing level according to the competitors. Price affects a firms competitive position and its market share. As a result price has considerable bearing on a company revenues and net profit through prices money comes to an organization. The Coca-Cola Company does not want increase price and want to increase sales volume with same price.

Pricing Objectives
Every Marketing activity including pricing should be directed to words a goal. To useful, the pricing objective management selections must be compatible with over all goals set by the firm and the goals of its marketing program. To adopt a primary pricing goal of maintaining to Coca-Cola market share of stabilizing price, the company will adopt two pricing objective.

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Profit-Oriented Goals of Coca-Cola

The Coca-Cola Companys goal may be set for the short or long term, it always select one of the two profit oriented goals for its pricing policy.

Maximum Profit
profit maximization goal is likely to be for more beneficial to Coca-Cola Company it is pursued over a long term. e.g. when Coca-Cola Company want to enter in new territory, where the market share of its competitor is at peak, it is adopted the policy that it allows discount in shape of low prices for their products. If the price of one crate is Rs. 240 its keeps its price by 230-225 rupees per carte.

PLACE
A distribution Channels consist of the set of people and firms involved in the transfer of the title to a product as the product moves from producer to ultimate consumer.

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INDIRECT DISTRIBUTION:
In case of Coca-Cola beverages mostly used this channel: Producer Whole seller Retailer Consumer

The Coca-Cola has their own factory. E.g. on motor way chook the coca cola is prepared there, and then provided to different whole seller wholesalers, the company provide them to bulk stock, which they then distribute to different retailers. In the sale department, there is also a well developed program for sale in different localities. For each territory the responsible person of each sale department have kept vehicles. The drivers used as salesman, he has a very close link with retailers. So from these retailers the products are then distributed to the ultimate consumer.

DIRECT DISTRIBUTION

Some time the company uses this 2nd Channel: Producer Retailer Consumer

E.g. some retailers come directly to the factory, where they receive Coca-Cola products in bulk and finely distribute these products to ultimate consumers.

Margin & Target

63

Margin for distributor/ agency in bottles per crate total Rs.12/- and net Margin Rs.8/- the remaining Margin use for fare shop, bus etc. Company also gives target achievement after selling some target which give by companies. Wall clock, deepfreezes, free bottles, high Margin etc.

PROMOTION

Promotion stands for the various activities the company undertakes to communicate its product merits to persuade target/potential customers to buy them. The major components which determines the success of the company, it is efficient promotion of their products. As the prices of all beverages are the same. Coca-Cola also feels the importance of efficient promotion therefore; they spend a large amount on the promotion program of Coke, but it is only spend internationally because we discuss before that the promotion of CocaCola is so low from their tough competitors PEPSI in Pakistan and the result PEPSI capture 60-70 % market share due to strong promotion of his products.

Advertising
Advertising is a paid, non personnel communication media to persuade or influence audience. It is the part of promotion. The Coca-Cola (SHAHI beverages) spends a little amount on advertising due to low sale as compared to Pepsi. It uses the Above-the-line and Below-the-line both advertising methods.

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Publicity
Publicity is unpaid advertising in a sense that it is done through person to person by providing information about specific product. It is also the part of promotion. Coca-Cola Company arranges for publicity in local media whenever there is launch of new product, policy or some promotional scheme. And according to its sale managers, strong rely on publicity

Personal Selling
Personal selling is also called as door to door selling. In it the employee of producers (sales man) directly goes to the people and sells goods. Coca-Cola Corporation avoids personal selling but in case of large store and hotels etc. it does use personal selling. The sale officers contact the owners and sell their products directly to owners.

Sale Promotion
Sale promotion is demand stimulating device designed to supplement advertising and facilitate personal selling. E.g. it includes (UTC) Under the Coupons, premiums, in store displays, trade shows, samples in store demonstration and contests.

In case of Coca-Cola, sales promotion strategies are divided in to three primary types. Coca-Cola consumers. Coca-Cola resellers Coca-Cola

The first two types have direct implications on advertising and thereforewill be discussed in detail. Sale force or sale promotion is simply activities directed at the firms, sale people to motivate them to strive to increase their sale levels. 65

ADVERTISING & PUBLICITY

Pepsi Co. is one of the biggest and spenders in India. It is also one of the biggest global ad spenders. It has long a list of endorsers from pop star Ricky martin to file stars Shahrukh Khan, Amitabh Bacchan etc. & Cricket stars Sachin Tendulkar, V.V.S Laxman, Harbhajan Singh etc. Hindustan Thompsom Associates, the big gets advertising agency of India has the account of Pepsi Co. is known for its board cast advertising but it also spends a lot in non board cast advertising i.e. hoarding, banners, posters stickers, specialties, hangar,dealer board, glow signboards, wall painting and news paper. The expenses on these type of advertising are made at territory or unit level. LUCKNOW territory has assigned two local advertising agencies R.D. Associates and Krishna for its territorial advertising.

3.4 MARKET SEGMENTATION

A market segment consists of a group of customers who share a similar set of needs andwants. Rather than creating the segment the marketers task is to identify them and decidewhich one to target. Leading soft drink companies Coca-Cola and Pepsi follow the similarsegmentation strategy for target marketing.

1. MASS MARKETING
However in some of its popular product both the companies follow the mass marketingstrategy. In this type of segmentation, companies target the whole market and not anyparticular segment of the population. 2. TARGETED MARKETING 66

Although the targeted group of the company is the whole population, they want to earnmore revenue from a segment than their other revenue generator sources. For this, theyrecognize following bases for segmentation

2.1 GEOGRAPHICAL 2.1.1 REGION

Both companies treat hot countries such as Asia, Middle East and African differently incomparison to cold countries. As in tropical countries, consumption of soft drinks is 70%in summer and 30% in winter season while in EUROPEAN countries its consumption isalmost uniform. So soft drink companies prefer different marketing strategies in Asian andEuropean countries. In countries like India and Pakistan, these companies invest hugeresources in the season of summers, and their target area is domestic users, restaurants,school and college canteens and even rural chaupals. While in winter season their target ismainly party users and high-income group consumers.

2.1.2 RURAL VS. URBAN MARKET

Coca-Cola Company is one of the first global majors to have spotted the potential spin offsfrom the countrys rural market. Population of Rural sector is more conscious more aboutthe price whereas Population of Urban sector is more conscious about the quality andbrand name of the product. so Coca cola and PepsiCo in Year 2002 bring the 200 ml bottleat Rs.5 specifically targeted at the rural sector so that soft drink can take place of the localdrink like lemon, sugarcane juice and Tea etc. Both the companies Coca-Cola and PepsiCo have adopted different marketing strategy for rural and urban areas.

2.2 DEMOGRAPHIC SEGMENTATION 2.2.1 AGE

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India is considered to be a young country i.e. average age of Indian population is less 38years. Thus targeting young generation can be a beneficial marketing strategy for soft drinkcompanies. In fact this is the case, all the major brands like Pepsi, coca cola, and thumpsup, mainly target younger generation in India. In Europe, as average population is olderthan Asian countries, Coca cola targeted the older generation of the population. Similarlyin USA, Pepsi targeted the generation X (younger generation) as they comprises majorityof the population and they positioned Pepsi in the mind of youth that Pepsi is for the youth

2.2.2 GENDER
Gender based segmentation is very important. As taste of male and female is different.Lets take the example of coca cola, thumps up is promoted as masculine soft drinks whilecoca cola and Fanta are having light taste and mainly targeted for loving birds, ladies, andchildren. Same example is available in Pepsi, mirinda orange flavor is popular amongladies, girls, and childre

PEPSI VS COKE/ RIVALRY WITH COKE

Pepsi ads often focused on celebrities, choosing Pepsi over Coke, supporting Pepsi's positioning as "The Choice of a New Generation." In 1975, Pepsi began showing people doing taste tests called Pepsi Challenge in which they preferred one product over the other, and then they began hiring more popular spokespersons to promote their products.

Coke dispenser flown aboard the Space Shuttle Endeavour in 1996.In the late 1990s, Pepsi launched its most successful long-term strategy of the Cola Wars, i.e. Pepsi Stuff. Consumers were invited to "Drink Pepsi, collect Pepsi Points on billions of packages. They could redeem the points for free Pepsi lifestyle merchandise.

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After researching and testing the program for over two years to ensure that it resonated with consumers, Pepsi launched Pepsi Stuff, which was an instant success. Tens of millions of consumers participated. Pepsi outperformed Coke during the summer of the Atlanta Olympics - where Coke was a lead sponsor of the Games. Due to its success, the program was expanded to include Mountain Dew. The company continued to run the program for many years, continually innovating with new features each year. In 1985, Coca-Cola and Pepsi were launched into space aboard the Space Shuttle Challenger on STS-51-F. The companies had designed special cans (officially the Carbonated Beverage Dispenser Evaluation payload or CBDE) to test packaging and dispensing techniques for use in zero G conditions. The experiment was classified a failure by the shuttle crew, primarily due to the lack of both refrigeration and gravity. A Coca-Cola fountain dispenser (officially a Fluids Generic Bio processing Apparatus-2 or FGBA-2) was developed for use on the Space Shuttle Endeavour as a "a test bed to determine if carbonated beverages can be produced from separately stored carbon dioxide, water and flavored syrups and determine if the resulting fluids can be made available for consumption without bubble nucleation and resulting foam formation". The unit flew in 1996 aboard STS-77 and held 1.65 liters each of Coca-Cola and Diet Coke.

3.5 TECHNIQUES FOR SALES PROMOTION

1.) Product availability -It means all the flavors of Pepsi should be available at one time. By which customer can able to give any flavor to the consumer and can give the satisfaction. 2.) 100% rich - It means that Companys top management should always worry about the quality of all the brands. If any organization wants to service in the market and wants to better its image then quality play a very integral role so for sales promotion quality should be 100% and good. 3.) Good relation Companys executive, sales man should make good relation from dealer, whole seller and retailer. There is only 20% brand loyal person. Remaining 80% impulse selling is

69

going on. It means in India in cold drinks line which ever brand consumer see first of all that brand is demanded by user. 4.) Proper signage- Proper shin age also play a key roll in more selling. 5.) Fulfill the commitment if executive promise to the customer of any type. Then executive shovel fulfill his promise, such as. Executive say that to the retailer if you will sell 1000 carrot in this month then I will give you a coke fridge. If retailer has sold out 1000 carrot in the month then executive should fulfill his commitment. By this manner selling will also improve.

SCHEME AS AN EXAMPLE OF SALES PROMOTION

1. 2. 3.

2 bottle 200ml free on 300ml/ Pepsi, Dew, 7up Mirinda 2 bottle 600ml free on 2000ml/ Pepsi, Dew, 7up Mirinda 2 bottle 500ml free on 500ml Lehar soda

BASIC CHANNELS OF DISTRIBUTION

Place
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Manufacturers/products

Agents/brokers Wholesalers/distributors Retailers Retailers

Consumers and organizational end users

Distribution Objective

Minimize total distribution costs for a given service output Determine the target segments and the best channels for each segment Objectives may vary with product characteristics

e.g. perishables, bulky products, non-standard items, products requiring installation & maintenance There are two marketing channels that involve in the transfer of product from the producer to the consumer. The intermediaries involved in the transfer are distributors and retailers.

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DISTRIBUTORS
Distributors are appointed agents of the company who make orders to the company by paying in advance through drafts, stock the products in their godowns and supply them to outlets through their fleet of delivery was and a team of salesmen and drivers. They are allowed to sell to company's product to the retailers in a specified area. The company divides this area into routes. Each route is covered by one unit i.e. one de livery van, one salesman one driver, one helper etc. These units and godown are their main investment. Distributors have to invest in empty bottles and crates too, so t hat they can maintain a specified quantity of reserve stock and facilitate the quick ratation of glass crates. The company evaluates its distributors at the end of the year and makes plans for the next year. Company fixes the targets for each distributor according to market size, last years sales, potential growth assumption based on deposit of empties and installation of coolers at outlets. Distributors are awarded with a fair margin of RS. 10 per crate for their service. This margin could be increased for the sale above the targets, company offers are met with distributors before appointing them. Distributor complying with many schemes and contests for its customers for pushing different brands and giving various services. Company also offers many gifts like, briefcase, and handbags. T-shirts, caps etc.to encourage the distributors. If distributor does not agree with the conditions of these agreement company may reduce the area of distributor or may even terminate the relationship

RETAILERS
The sale of particular soft drinks depends a lot entirely on retailers wish. Like if he does not keep Aquafina and if his shop is at the prime location then certainly the customer with turn towards other cola drinks like Bisleri, Bailley ,Kinley etc. This all goes to prove that retailer is king. So retailers require special focus from the company. Pepsi Co. helps the retailers to serve its customer better by providing good margin to them for storing its product using merchandising to improve instore product display, installing cooling equipment in outlets to make the product ready to drink

72

and offering different promotion schemes to them time to time to push different brands, Pepsi Co. Provides a fair margin of RS. 24 per crate to the retailers.

CUSTOMER SERVICE DEPARTMENT

Customer Service is a support function to sales and marketing Department and is concerned with effectively dealing with all customer complaints This starts from: Ensuring Receipt, Documentation and Follow Up of all complaints to be take care of within a specified time in order to achieve the ensure Customer (retailer) distributor and consumer Satisfaction. The Customer complains directly through phone or pager or through the sales team visiting them.

Types of Complaints handled are related to: Consumer Signage and Schemes

POPULAR SLOGANS

1987 1989 1992 1993 1995 1997

America's Choice A Generation Ahead Gotta Have It Be Young, Have Fun, Drink Pepsi Nothing Else is a Pepsi Generation Next 73

1998 1999 2000 2003 2003-2005 2005-2006 2006-2007 2007-2008 2008-2009 2010

Same Great Taste The Joy of Cola The Joy of Pepsi Pepsi. It's the Cola "Yeh Pyas Hai Badi" "An ice cold Pepsi. It's better than sex Yeh PYAAS Hai BADI!! Yeh DIL Mange MORE!! Yeh hai Youngistaan Meri Jaan!! Yeh Hai Youngistaan Ka WOW!!

Coke v/s Pepsi-Product

As seen above both the companies Coke and Pepsi have a number of products. Many of these products are innovations but there are also many products which are brought out just as a competitive product for the other companies. Some of these products that are brought in the market by both the companies to compete against each other are as follows:

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COCA COLA
The main dark cola drink of the company which started the rivalry between these companies.

PEPSI
Pepsi version of dark cola which is the major primary competitor to Coke.

F u l l Th r o t t l e i s a n e n e r g y d r i n k b r a n d p r o d u c e d b y Th e C o c a - C o l a C o m p a n y . It debuted in late 2004 in North America.

AMP is an energy drink produced and distributed by PepsiCo under the Mountain Dew soft drink brand.

Vault is a carbonated beverage that w a s r e l e a s e d b y Th e C o c a - C o l a Company in June 2005.

Mountain Dew MDX is an energy drink manufactured and distributed by PepsiCo under the Mountain Dew brand. It was introduced in 2005.

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P o w e r a d e i s a s p o r t s d r i n k b y Th e G a t o r a d e i s a n o n - c a r b o n a t e d s p o r t s d r i n k Coca-Cola worldwide. Diet Coke or Diet Coca-Cola is Company and currently marketed by Quaker Oats Company, a athletes, it is now often consumed as a snack beverage. a Diet Pepsi is a low-calorie carbonated number two in the sports drink market division of PepsiCo. Originally made for

in 196 as s u g atre f i s ea c l efa r , dlreimk n -p r md u c l a v o a e d , c oUp. is a tbrand of ai lemon-limedflavored soft4drink. a so t n o li o e fed r nd 7 la I was ntroduce Spri - re d i sn - cb uf e i n a t e d y s o f t T h e i n k , C o c a - C o l a v a r i a n t o f P e p s i - C o l a w i t h n o s u g a r . b no tri af ted dr produced Cy mtp aen y C o I ta - C o l a i n to md u c e d i n w aes . c was C ro pany. It th bo h U n r t e du c e d t e s oi n tJ u l y U 9 8t2 .d S t a t e s i n int iod Sta t he 1ni e 1961. K i n l e y i s a b r a n d o f s t i l l o r c a r b o n a t e d Aquafina is a non-carbonated bottled water produced w a ne rt e oM a ie d i sb ya wn d Mit u Ce v e pa g e s , u s u a l l y b om r any. Tho d u cC o c i n e o lo f byrPepsiCo. a pr e t la-C a T opican associated with company Products based in is an American Florida,

Bradenton,

orange juice, but now extends to soft USA, which is one of the world's largest drinks of many kinds. The Minute Maid producers and marketers of orange juice. company is now owned by Coca-Cola, It has been owned by PepsiCo, Inc. since and is the world's largest marketer of 1998. fruit juices and drinks. It is headquartered in Houston, Texas.

3.7 MARKETING STRATEGIES OF PEPSI

Pepsis approach is radically different from that of Coke, Pepsi has gone in for concentration segmentation. Pepsi has targeted the youth segment instead of trying to be something to all segments. Pepsi has since beginning strove to achieve its international position as `a drink for the new generation in India. Helped by HTAs forceful visuals and creative, Pepsi has been successful in positioning itself for the younger generation.

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SELLING PROCESS
Pepsi has a very well managed selling system. It takes as lot of care to ensure that the products (Pepsi bottles) are available to the consumers. Pepsi soft drinks are produced in our plant in different SKUs (Stock keeping units) and distributed to our distributer and they further supply to the retailer. Shahibabad (GZB) has been divided around 14 routes which are called direct routes. For every route there is a Routs Agent. Route Agent moves with the company owned truck and ensure that maximum shops are covered each day, so that regular supply of Pepsi soft drinks is made.

Routs agents take the order from the shopkeepers and then with the help of loaders they give the required number of crates to the retailer or shopkeeper & then move to next. Our plants also have some agency in each rout. They supply in the areas where Pepsis trucks are not able to reach. These areas are called indirect-routes.

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MICHAEL PORTER MODEL FOR PEPSI

POTENTIAL BUYERS

ENTRANTS

INDUSTRY COMPETITORS

SUPPLIERS

SUBSTITUTES

ENTRANTS
Two soft drink giants i.e. Pepsi, Coke, are already here, no other company plans to enter in this capital-intensive industry at the moment. The investment in this industry is more than Rs.100 per crate. This leaves no scope for small players who cannot match the might of the two multinational giants. Thus at the moment there are no potential entrants.

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SUPPLIERS
The bottling is done either by franchises or by company owned bottling plants. The empty glass bottles and shells are sourced from local manufacturers. The ingredients for the concentrate are sourced and manufactured locally. There is abundant supply of water and sugar. Thus on the suppliers side Pepsi does not have a problem. Presently the cans are imported and filled locally near Pune in Maharashtra. Seeing the potential, various local manufacturers are setting up plants for manufacturing cans in India. Soon this problem will also be resolved.

BUYERS
The following are the various market segments 1. 2. 3. 4. 5. 6. On-premise market. Home market. At work market. Youth market. Special events market. High visibility market.

SUBSTITUTES
Any drink, which quenches thirst, is a substitute. Thus this industry is highly competitive as even water is substitute and almost a dozen products are launched every year. Recently Dabar India Ltd. has launched Real - fruit juices and the makers of Frooti have launched Jolly Jelly. But nowadays, people prefer carbonated drinks because of the taste, fizz and the fun element attached with it. 79

COMPETITION
The other two major players in this industry are Coca Cola and Cadbury Schweppes. The real competition is between Pepsi and Coke. Presence of competition will ensure expansion of the market by collective efforts, which is growing at a rate of 25% annually. There is tremendous potential considering the per capita consumption of India, which is a measly 0.6 liters as compared to US where it is 83.5 liters. Presently Pepsi has stolen a march over its rival because of its marketing efforts.

3.8 MARKETING STATEGIES OF COCA-COLA

PRODUCT
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Coke was launched in India in Agra, October 24, in '93', soon after its traditional all Indian launch of its Cola. At the sparking new bottling plants at Hathra near Agra.Coke was back with a bang after its exit in 1977. Coke was planning to launch in next summer the orange drink, Fanta-with the clear lemon drink, sprite, following later in the year. Coke's product line includes, Coca-Cola, Thums Up, Fanta, Maaza, Sprite, Club Soda, 7up,Limca,Fanta apple, Diet Coke.

i) PACKAGING : Coca-Cola India Limited (CCIL) has bottled its Cola drink in different sizes and different packaging i.e., 200 ml bottle, 300 ml. Bottle, 330 ml. Cans, 500 ml. and bottles of 1 and 2 litre.

PRODUCT POSITIONING
One important thing must be noticed that Thums Up is a strong brand in western and southern India, while Coca Cola is strong in Northern and Eastern India. With volumes of Thums Up being low in the capital, there are likely chances of Coca Cola slashing the prices of Thums Up to Rs. 5 and continue to sell Coca Cola at the same rate. Analysts feel that this strategy may help Coke since it has 2 Cola brands in comparison to Pepsi which has just one. Thums Up accounts for 40% of Coca Cola company's turn over, followed by Coca Cola which has a 23% share and Limca which accounts for 17% of the turn over of the company. We will sell whatever consumers wants us to". Coca Cola India has positioned Thums up as a beverage associated with adventure because of its strong taste and also making it compete with Pepsi as even Pepsi is associated with adventure youth.

PRICE
The price being fixed by industry, leaving very little role for the players to play in the setting of the price, in turn making it difficult for competitors to compete on the basis of price.

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The fixed cost structure in Carbonated Soft Drinks Industry, and the intense competition make it very difficult to change or alter the prices. The various costs incurred by the individual companies are almost unavoidable. These being the costs of concentrates, standard bottling operations, distributor and bottlers commissions, distribution expenses and the promotional and advertising expenditure (As far as Coke is concerned, it had to incur a little more than Pepsi as Pepsi paved its way to India in 1989 while Coke made a comeback in 1993.) Currently a 300 ml. Coke bottle is available for Rs10 the 330 can was initially available for Rs. 15 and now Rs.20. The prices of 500 ml, 1 litre. And 2ltr being Rs20 Rs.35 and Rs.50 respectively (according to the current survey). However, the trends may have been in the early '90's, now the prices of Pepsi and Coke are the same making it difficult in future and present to compete on the basis of price.

PLACE
Coke may have gained an early advantage over Pepsi since it took over Parle in 1994. Hence, it had ready access to over 2,00,000 retailer outlets and 60 bottlers. expanded its distribution network. Coke and its product were available in over 3,00,000 outlets (in contrast with Pepsi's 2,75,000). Coke has a greater advantage in terms of geographical coverage. Coke and Pepsi have devised strategies to get rid of middlemen in the distribution network. However, 50% of the industry unfortunately depends on these middlemen. As of now, around 100 agents are present in Delhi. Bottlers of the 2 multinationals have strongly felt the need to remove these middlemen from the distribution system, but very little success has been achieved in doing so. Coke was had a better distribution network, owing to the wide network of Parle drinks all over India. Coke has further

PROMOTION
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It must be remembered that soft drinks purchases are an "impulse buy low involvement products" which makes promotion and advertising an important marketing tool. The 2 arch rivals have spent a lot on advertising and on promotional activities. According to Paul Stobart, Advertising encourages customers to recognize the quality the company offers. Price promotions often produce short-term sales increases

SOME POPULAR SLOGANS OF COCA COLA

1986

Catch the wave (Coca-Cola) Red White & You (Coca-Cola classic Cant Beat the Feeling Cant Beat the Real Thing Always Coca-Cola Taste it all Play Red Hot Summer Play Red Hot Summer Again Enjoy Life is Good

1989 1990 1993 1994 1995 1996 2001

2003

Real

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2005

Welcome to the Coke side of life Make It Real

2007

Live on the coke side of life

2009

Open Happiness

2010

Open Happiness

3.9 OTHER STRATEGIES ADOPTED BY COCA-COLA AND PEPSI

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The Pepsi Process: Despite being a global brand, Pepsi has built its success on meeting the Indian consumers needs, particularly in terms of making the brand synchronize with localized events and traditions. Instead of harping on its global lineage, ergo, it tries to plug into ethnic festivals, use the vernacular indifferent part of the country, and blend into the local fabric. Pepsi is using both national campaigns-such as the Drink Pepsi, Get Stuff scheme, which offers large discounts on other products to Pepsi-buyers as well as local . The Coke Copy: Instead of creating a bond with the customers through small but high-impact events, Coca-Cola chose to associate itself with national and international mega events like the World Cup Cricket, 1996, and world cup football 1998. But now coke is also entering into local actions. Coke is also trying to make their brand synchronize with localized events traditions and festivals. Coca-Cola new tag line in this advertisement is Real shopping, Real refresher. In this way Coke is copy Pepsi.

EMPOWERMENT
The Pepsi Process: Once of the strongest weapons in Pepsis armory is the flexibility it has empowered its people with. Every manager and salesperson has the authority to take whatever steps he, or she, feels will make consumers aware of the brand and increase its consumption. The Coke Copy: Flexibility is the weapon that Coca-Cola, fettered as it is by the need for approvals from Atlanta for almost everything. In the past, this has shown up in its stubborn insistence on junking the franchisee network it had acquired from Parle; in its dependence on its own feedback mechanism over that of its bottlers; and on its headquarters-led approach.

PRICE
The Pepsi process: Pepsi has consistently wielded its pricing strategy as in invitation to sample, aiming to turn trial into addiction. It launched the 500 ml bottle in 1994 at Rs. 18 versus Thums Ups Rs. 9, in April, 1996, its 1.5 litre bottle followed Coke into the marketplace at Rs. 30 Rs 5 less than Cokes .But it couldnt continue the lower price positioning for long. 85

The Coke Copy: Initially, coke carbon-copied the strategy by introducing its 330ml cans in January 1996, at an invitation price of Rs. 15 before raising it to Rs.18. By this time, it had realized that the Coca-Cola brand did not hold enough attraction for customers to fork out a premium.

OVER A CENTURY OF COLA SLOGANS, COMMERCIALS, BLUNDERS, AND COUPS

There's little doubt that the most spirited and intense competition in the beverage world is between Coca-Cola and Pepsi. These two American companies long ago took their battle worldwide, and although there are other colas in the market, these giants occupy this high-stakes arena by themselves. The impact of Coke and Pepsi on popular culture is indisputable, and I have observed in my time managing this web site that America has not become jaded about the cola wars. The memorabilia, the jingles, the trivia - all still popular. So I am offering this page in an attempt to assuage a wee bit of the Coke and Pepsi thirst that is thriving on our planet.

IT ALL STARTED . . . . Coca-Cola was invented and first marketed in 1886, followed by Pepsi in 1898. Coca-Cola was named after the coca leaves and kola nuts John Pemberton used to make it, and Pepsi after the beneficial affects its creator, Caleb Bradham, claimed it had on dyspepsia. For many years, CocaCola had the cola market cornered. Pepsi was a distant, no threatening contender. But as the market got more and more lucrative, professional advertising became more and more important. These soda companies have been leading the way in advertising ever since.

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ADVERTISING HISTORY & COMMERCIALS

Pepsi has definitely leaned towards the appeal of celebrities, popular music, and young people in television commercials, while Coke relies more heavily on images of happiness and togetherness, tradition, and nationalism, perpetually trying to cash in on its original lead. In a simplified sense, you could sum up the strategies as Coke: Old, Pepsi: New. In fact, as we will see, when Coca-Cola tried something new, it was disaster. The first magazine ad for Coca-Cola appeared in Munsey's in 1902. Advertisements began to appear on billboards, newspapers, and streetcars. Soon there were serving trays with images of people enjoying Coca-Cola, and glasses with the cola's name on them. At this time, Coca-Cola and Pepsi were served in drugstore soda fountains. In 1909, Pepsi used its first celebrity endorser, automobile race driver Barney Oldfield, in newspaper ads. In 1921, Pepsi went bankrupt, but continued to appear on the scene, although not nearly so successfully as Coca-Cola. In 1931, Pepsi went bankrupt again, but the new owner, Roy Megargel, would hit upon an idea that would finally give Coca-Cola some competition. In 1934, he marketed Pepsi in a 12-ounce bottle for a nickle. At the time, Coca-Cola was sold in a 6-ounce bottle for ten cents. Voila! Profits for Pepsi. Pepsi racked up another first by airing the first radio jingle in 1939. It was so popular that it was played in jukeboxes and became a hit recordCoca-Cola hit the airwaves in 1941. In 1946, inflation forced Pepsi to increase prices. And in 1950, Pepsi offered a larger 26-ounce bottle to court the young American housewife. In the 1960's, the cola ad wars moved to television. Coca-Cola employed a host of celebrity singers to promote the product, including Connie Francis , Tom Jones, The New Beats, Nancy Sinatra, and The Supremes. As we moved through the years, both colas incorporated some of their best slogans ("Pepsi Generation" and "the Real Thing") into subsequent commercials. 87

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Chapter - 4 Findings And Analysis

SWOT ANALYSIS FOR PEPSI COLA

SWOT stands for Strengths Weakness Opportunities Threats SWOT analysis is a technique much used in many general management as well as marketing scenarios. SWOT consists of examining the current activities of the organisation- its Strengths and Weakness- and then using this and external research data to set out the Opportunities and Threats that exist.

The following analysis deals only with strengths, opportunities, and threats.

Strengths:
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Coca-Cola has been a complex part of American culture for over a century. The product's image is loaded with over-romanticizing, and this is an image many people have taken deeply to heart. The Coca-Cola image is displayed on T-shirts, hats, and collectible memorabilia. This extremely recognizable branding is one of Coca-Cola's greatest strengths. "Enjoyed more than 685 million times a day around the world Coca-Cola stands as a simple, yet powerful symbol of quality and enjoyment" (Allen,). Additionally, according to Bettman, et. al, Coca-Cola's bottling system is one of their greatest strengths. It allows them to conduct business on a global scale while at the same time maintain a local approach. The bottling companies are locally owned and operated by independent business people who are authorized to sell products of the Coca-Cola Company. Because Coke does not have outright ownership of its bottling network, its main source of revenue is the sale of concentrate to its bottlers (Bettman, et. al,).

Weaknesses:
Although domestic business as well as many international markets are thriving (volumes in Latin America were up 12%), Coca-Cola has recently reported some "declines in unit case volumes in Indonesia and Thailand due to reduced consumer purchasing power." According to an article in Fortune magazine, "In Japan, unit case sales fell 3% in the second quarter ...scary because while Japan generates around 5% of worldwide volume, it contributes three times as much to profits. Latin America, Southeast Asia, and Japan account for about 35% of Coke's volume and none of these markets are performing to expectation (Mclean). Coca-Cola on the other side has effects on the teeth's which is an issue for health care. It also has got sugar by which continuous drinking of Coca-Cola may cause health problems. Being addicted to Coca-Cola also is a health problem, because drinking of Coca-Cola daily has an effect on your body after few years.

Opportunities:
Brand recognition is the significant factor affecting Coke's competitive position. Coca-Cola's brand name is known well throughout 94% of the world today. The primary concern over the past few years has been to get this name brand to be even better known. Packaging changes have also affected sales and industry positioning, but in general, the public has tended not to be affected by new products (Allen). Coca-Cola's bottling system also allows the company to take advantage of infinite growth opportunities around the world. This strategy gives Coke the opportunity to service a large geographic, diverse, area (Bettman, et. al,).

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Threats:
Currently, the threat of new viable competitors in the carbonated soft drink industry is not very substantial. The threat of substitutes, however, is a very real threat. The soft drink industry is very strong, but consumers are not necessarily married to it. Possible substitutes that continuously put pressure on both Pepsi and Coke include tea, coffee, juices, milk, and hot chocolate ("Cola Wars). Even though Coca-Cola and Pepsi control nearly 40% of the entire beverage market, the changing health-consciousness of the market could have a serious affect. Of course, both Coke and Pepsi have already diversified into these markets, allowing them to have further significant market shares and offset any losses incurred due to fluctuations in the market ("Cola Wars"). Consumer buying power also represents a key threat in the industry. The rivalry between Pepsi and Coke has produce a very slow moving industry in which management must continuously respond to the changing attitudes and demands of their consumers or face losing market share to the competition. Furthermore, consumers can easily switch to other beverages with little cost or consequence ("Cola Wars").

CHAPTER-5
91

CONCLUSIONS

CONCLUSION

The project was a great experience for me in order to study the marketing aspects in the world.It was the great opportunity for me to do the project work because till now we have learned the theory regarding the marketing and other related concepts.but now we got the chance to implement that theoretical knowledge to do the project and got the practical experience in the marketing field. Soft drink industry is a vast growing industry when compared to many other industries. This industry is a place where two major players are there in the world. Pepsi Company is one of them. Doing my project in Pepsi is a great experience as it gave me lot of opportunity and scope to understand the soft drink industry and its marketing structure and distribution channels. According to my project I have analysed that the difference between Coke and Pepsi really is all in your head. Apparently the popularity of Coke's brand image causes people to think Coca-Cola itself tastes better, even though it really doesn't taste very different from Pepsi. As Great researchers said: "When asked to taste blind, they showed no preference. However, when the 92

participants were shown company logos before they drank, the Coke label, the more famous of the two, had a dramatic impact: three-quarters of the tasters declared they preferred Coke. After the study of the project, I have got several information and real facts about Pepsi & Coca Cola :

Through this Project , I came to know about the formulation of soft drinks and its marketing structure as well as its distribution channels. As the T.V. ads are influencing the soft drink sales, the companies designs the new ads in an attractive way in different regions according to the culture of that area. Pepsi influence & spend more on mass advertising rather improving their quality of services. The Marketing strategies of coca cola are much better than that of pepsi because it caters the need of people by supplying them good quality products on time.

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CHAPTER-6 RECOMMENDATIONS

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RECOMMENDATIONS

Pepsi Company has to supply their entire product sufficiently and regularly in time to the retailers. So that the loyalty of the retailers will be increased.

As most of the retailers require the daily supply, the Company has to supply the drinks daily to the retailers, so that they can serve the consumers according to their requirements. If they dont supply the drinks daily and sufficiently the sales will be decreased.

As the retailers are highly satisfied with COCA COLA Companys service and not that much satisfied with PEPSICO Companys service (supply), Pepsi Company need to attract the retailers towards Pepsi by explaining the quality of Pepsi Companys service to increase the sales of the company

Pepsi Company should introduce the new and attractive consumer promotional offer. Then the consumers will be attracted towards the Pepsi brands. Then the profits of the company will be increased.

As the health consciousness is growing, the people are consuming the fruit based soft drinks. Company has to conduct some programs to bring more awareness of the fruit based soft dinks and its benefits to the consumers. Then the sales of the fruit based soft drinks sales will be increased.

Pepsi Visi coolers are supplied very less to the retailers when compared to coke. The company has to supply more Visi coolers to the retailers to increase their business. The 95

company also has to check the condition of the Visi coolers regularly and if any problems are there then they have to rectify those problems.

The soft drink companies are not providing the credit. This is a problem to the retailers because they have to invest the amount before the sales of the soft dinks. This may be the problem for some retailers with low investment. So it is better to provide the credit system to the retailers.

BIBLIOGRAPHY

BOOKS:
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Chabbra,T.N Marketing Management, Dhanpat Rai & Co,2010 Kotler Philip Principles Of Marketing Management, Prentice Hall India,2003 Kothare, C.R, Research Methodology,III Edition,1997,Vikas Publishing House Pvt Ltd.

RELATED WEBSITES:

http://www.pepsico.com/Company/Our-Mission-and-Vision.html http://www.scribd.com/doc/36967189/Pepsi-and-Coca-Cola http://www.scribd.com/doc/24224197/Pepsi-Cola http://www.scribd.com/doc/20596818/analysis-of-marketing-strategy-ofcoca-cola-and-pepsi

http://www.adglitz.com/2009/07/13/coca-cola-slogans-history-cokepunchlines-over-the-years/

http://slogansmith.blogspot.com/2009/05/pepsi-slogans-peps-you-upcollection.html

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