Download - Pepsico: Part I
PEPSI –THE FLAGSHIP PRODUCT
The recipe for Pepsi (the soft drink),
was first developed in the 1880s by a
pharmacist and industrialist from New
Bern, North Carolina, named Caleb
Bradham—who called it "Pepsi-Cola"
in 1898. As the cola developed in
popularity, he created the Pepsi-Cola
Company in 1902 and registered a
patent for his recipe in 1903.
ORIGIN
Charles Guth purchased the trademark and
syrup recipe. He himself owned a syrup
manufacturing unit in Baltimore.
He also owned a candy unit called ‘Loft’. He
used Loft’s labs and reformulated Pepsi’s
formula. After winning a lawsuit against Loft’s
shareholders, Guth absorbed Pepsi into Loft
and rebranded it as Pepsi-Cola. Pepsi cola
then launched new products such as Diet
Pepsi and Mountain Dew.
1893: Caleb Bradham, a young pharmacist from New Bern, North Carolina, begins experimenting with many different soft drink concoctions.
1898:One of Caleb's formulations, known as "Brad's Drink," is renamed "Pepsi-Cola" on August 28, 1898. Pepsi-Cola receives its first logo.
1902: Bradham applies for a trademark with the U.S. Patent Office, Washington D.C., and forms the first Pepsi-Cola Company.
1905:Pepsi-Cola's first bottling franchises are established in Charlotte and Durham,North Carolina. Pepsi receives its new logo.
1923:Pepsi-Cola was bankrupt. Pepsi-Cola trademark sold to Craven Holdings Corporation.
PEPSICO INTERNATIONAL :HISTORY OF PEPSICO
1931:Pepsi-Cola Company was declared bankrupt for the second time and bought by Loft Incorporation.
1934:Pepsi-Cola drink was a hit and to attract even more sales, the company begins selling its 12-ounce drink for five cents.
1958:Pepsi continued to expand, and was now available in 120 countries.
1963:The 12-ounce bottle gives way to the 16-ounce size. Twelve-ounce Pepsi cans are first introduced to the military to transport soft drinks allover the world.
1965:Expansion outside the soft drink industry begins. Frito-Lay of Dallas, Texas, and Pepsi-Cola merge, forming PepsiCo, Inc.
1970:Pepsi introduces the industry's first two-liter bottles. Pepsi is also the first company to respond to consumer preference with light-weigh, recyclable, plastic bottles.
1991:Pepsi introduces the first beverage bottles containing recycled polyethylene terephthalate (or PET) into the marketplace. The development marks the first time recycled plastic is used in direct contact with food in packaging.
1992:Pepsi-Cola and Lipton Tea Partnership is formed.
1998:PepsiCo acquires Tropicana Products from Seagram Company Ltd.,the biggest acquisition ever undertakenbyPepsiCo.
2001:PepsiCo merged with the Quaker Oats Company.
BOARD OF DIRECTORS
Victor J. Dzau, M.D. , Ian M. Cook, Sharon Percy Rockefeller , Daniel Vasella, M.D. , Dina Dublon , Ray L. Hunt , James J. Schiro , Shona L. Brown , Shona L. Brown , Lloyd G. Trotter , Indra k. Nooyi , Alberto Weisser , Alberto Ibarguen
LEADERS OF PEPSICO
Indra Nooyichairman/CEO, Pepsico
John ComptonPresident, Pepsico
Brian CornellCEO, Pepsico Am. Foods
Albert P. CareyCEO, Pepsico Am. Beverages
Zein AbdullaCEO, Pepsico Europe
Sadd Abdul-LatifCEO, Pepsico Asia, Middle
East, Africa
Indra Krishnamurthy Nooyi Nooyi joined PepsiCo in 1994 and
was named president and CFO in 2001
Since she started , the company's
annual revenues have risen to 72%
Net profit more than doubled, to $5.6 billion in
2006
She was named the CEO of PepsiCo in 2006
Currently she is ranked as the 10th most powerful
woman in the world
ORGANIZATION STRUCTURE
Pepsico
PepsiCo Americas Foods
(PAF)
Frito-Lay North America (FLNA)
Quaker Foods North America
(QFNA)
Latin America food (LAF)
PepsiCo Americas
Beverages (PAB)
Pepsico International (PI)
EuropePepsiCo Asia, Middle East & Africa (AMEA)
PEPSI-COLA BRANDS
CARBONATED BEVERAGES:
▪ Pepsi
▪ Mirinda-orange
▪ Mountain dew
▪ Mountain lemon
▪ 7-up
▪ Soda water(Lehar)
NON-CARBONATED BEVERAGES:
▪ Slice/slice new
▪ 7-up nimbooz
PACKAGED DRINKING WATER
▪ Aquafina
FRITO LAY
Frito-Lay merged with Pepsi-Cola in 1965
Frito-Lay brands account for 59% of the U.S. snack chip industry
Cheetos snacks
Kurkure
Lays potato chips
Lehar
Quaker & Gatorade
PepsiCo merged with The Quaker Oats Company in 2001
Quaker Oatmeal, Mother's Natural Foods, Quaker Toasted Oatmeal, Quaker Corn Bran, Quaker Oat Bran, Quaker Puffed Rice, Quaker Puffed Wheat
Gatorade is known for sport’s drink
Marketing Strategies
Initial Marketing Strategy
Walter Mack , President of
Pepsi Cola tapped African
American market.
Mack launched new
campaigns such as “Leaders
in their field” showing Blacks
in a positive light
Used Racism as a selling
point to increase sales.
Marketing- Early 19s to 20s
1930-1970 Promotion through beauty pageants, sports, jingles and ads
In 1975, Pepsi introduced the Pepsi Challenge marketing campaign
Change in logo,slogan & packaging to imbibe New spirit in Pepsico products
Launch of highly successful Pepsi Stuff campaign in 1996
Country specific advertising using brand ambassador from different spheres
Marketing Strategy – Early 20s to 2014
Categorization of product as health and fun
Adhering to 4 Ps and 5 Cs of marketing
Creation of customer value
Responsible Marketing
Change is Constant
CURRENT MARKET SCENARIO
The $65-billion PepsiCo has earmarked an investment of Rs 33,000
crore ( $5.5 billion) for India till 2020.
PepsiCo's investment comes a year after its rival Coca-Cola announced
plans to devote $5 billion to build capacity here.
It's now looking at launching a new category of convergence products,
which could be a mix or a cross of cereals and milk or juices
Many in the industry say PepsiCo's Rs 160-crore IPL spend for the year
was too much to begin with. Coca-Cola India was not even present for the
bidding for this year.
A source in a leading executive search firm says PepsiCo has poor
management rather than lack of leadership talent.
GROSS PROFIT : $37.84 billion
SWOT ANALYSIS STRENGTH:
• Long history in cola market and strong global
image
• Brand diversification
• CSR projects through PepsiCo Foundation.
• Competency in mergers and acquisitions• Successful marketing and advertising campaign
WEAKNESSES:
• Overdependence on Wal-Mart
• Unavailability of various demanded flavors like
Mountain Dew & Mirinda Lemon
• Much weaker brand awareness and market share
in the world beverage market compared to Coca-
Cola
OPPORTUNITIES:
• Opportunities in international market
• Bottled water consumption growth
• Company has brand equity in the eyes of
customers, so its new products can easily
penetrates in the market
THREAT
• Strong competitors
• Change in customer taste and preferences
• Restrictions made by Govt. agencies that soft
drinks are harmful &non-nutritive
COMPETITORS
▪ Coca-Cola- No.1 beverage company
▪ Mondelez International(Kraft Foods)
▪ Dr. Pepper Snapple Group- DPS is the #3 soda business in North America after #1 Coke and #2 Pepsi.
▪ Nestle a major competitor