PEPSI & COCA COLA

INTRODUCTION AND HISTORY

The originator of PEPSI is Caleb D. Bradham in 1898.

PepsiCo. introduced as Brad's Drink, by Caleb D. Bradham, it was renamed as Pepsi-Cola on August 28, 1898, then to Pepsi in 1961.

PepsiCo entered Pakistan in 1967.

It is the 2nd largest manufacturer of soft drinks in the world, with a 21 percent share of the carbonated soft drink market worldwide.

History Of Pepsi

• In 1902 The trademark for the name Pepsi-Cola was registered in U.S Patent Office.

• it was renamed as Pepsi-Cola on August 28, 1898, then to Pepsi in 1961.

• In 1931, at the depth of the great Depression, the Pepsi-Cola Company entered bankruptcy.

• Megargel was unsuccessful, and soon Pepsi's assets were purchased by Charles Guth, the President of Loft, Inc

INTRODUCTION AND HISTORY

Founded in 1886 by pharmacist Dr John S Pemberton in Atlanta, Georgia.

It is no.1 brand according to fortune 2009 survey.

The Coca-Cola Company is headquartered in Atlanta, Georgia.

With local operations in over 200 countries around the world.

Coca Cola has 150,900 employees worldwide.

The Coca-Cola Company has been serving for more than 127 years

History of Coke-Cola• Frank M. Rabinson, suggested the name of Coca-

Cola.• Red has been distinctive color associated with the

soft drink ever since.• The trademark Cola-Cola was time registered in

United state patent office on January 31, 1893.• Robert W. Woodruff became the president of

company, in the year 1923 and his more than sixty year of leadership took Coca-Cola one of the most recognized and valued brand around the world.

• In 1961, Sprite was introduced.• In 1963, Roberto Goizueta becomes CEO of Coca-

Cola.

History of Coke-Cola in Pakistan

• The coca cola began operating in Pakistan in 1953.

• The coca cola plants are located in Karachi, Hyderabad, Sialkot, Gujranwala and Lahore.

• The Coca Cola company in Pakistan has nearly 3,000 peoples working constantly in company.

• During the last two years, Company invest $130 million in Pakistan.

Marketing Mix 4Ps

Price – How you price your product or service so that your price remains competitive but allows you to make a good profit.

Place– Where your business sells its products or services and how it gets those products or services to your customers.

Product – The products or services offered to your customer: Their physical attributes, what they do, how they differ from your competitors and what benefits they provide.

Promotion – The methods used to communicate the features and benefits of your products or services to your target customers.

Marketing Mix of Coca-Cola

Product• The Coca-Cola formula is The Coca-

Cola Company's secret recipe for Coca-Cola.

• Coca cola has its market presence around 200 countries.

• Coca-Cola has a very large product category including e.g. different type of cola drinks, energy drinks, juices and so on.

• World’s most favourite brand.

Product Line

Total number of coca cola products is 3,500 worldwide

Product line in Pakistan

Price• Earlier Coca-Cola used cost based

pricing, but later on when competition started, now Coke has shifted to competitive pricing strategy.

• The price of Coca Cola also depends on its products and sizes.

• Prices range from Rs.25 to 110.• Pricing is done keeping in view the

increasing with Pepsi.

Price cont..• Pricing is basically standard for all over

the world.• Each sub-brand of Coke has different

pricing strategy according to the market and its segments.• Coke spends more on advertising than

manufacturing.• Pricing is done keeping in view the

increasing with Pepsi.

Place• Coca cola is the world’s most

favorite brand and is available all over the world.

• You can find Coke at any stores, restaurants, or gas stations even at vending machines. Because Coca Cola is a leading brand.

• Transportation is done by Air planes, ships, lorries.

• Coke sets its own distributions directly to stores Supermarket.

Place cont...• Distribution channel of Coca-Cola

Promotion Coco-Cola is commonly known all over the

world because of their great marketing strategy. It includes variety of methods to present their product:

Uses famous people to advert their product Advertising in TV and magazines Sponsorship activity

SALES PROMOTION ACTIVITIES

Coca-Cola Cricket Coca-Cola Concerts Coca-Cola Food

Mela Coca-Cola Basant

Festival Coca-Cola Ramzan

Campaign

Slogans

life is good Jo Chaho Hojae Coca-Cola enjoy Thanda Matlab Coca-Cola Kha Le Pee Le Jee Le

("eat drink live")

Marketing Mix of Pepsi

Product• Pepsi is made with carbonated water, high

fructose corn syrup, caramel color, sugar, phosphoric acid, caffeine, citric acid and natural flavors.

• Pepsi is available in many flavors according to needs and wants of customers.

• PepsiCo produced two types of products: Beverages foods

Product cont… Product line PepsiCo

Price• Following factors Pepsi kept in mind while

determining the pricing strategy:Price should be set according to the product demand of public. Price should be that which gives the company maximum revenue.Price should not be too low or too high than the price competitor is charging from their customers otherwise nobody will buy your product. Price must be keeping the view of your target market.

• The best things about the company is that it is very flexible and it can come down the prices very quickly.

• Competition based pricing.

Prices of Pepsi in Pakistan

250 ml-----------------------------------RS. 25.00/-500ml------------------------------------RS. 40.00/-1000ml----------------------------------RS. 55.00/-1500ml----------------------------------RS. 80.00/-2250ml----------------------------------RS. 100.00/-

Place• The products were sold in more

than 200 countries in the world.• The products are available in

supermarkets, cafes, restaurants, vending machines, gas stations, movie theaters and so on.

Distribution channels

PepsiCo company distribute its products in three different ways:

1. Direct store delivery

2. Customer warehouse

3. Distributor Networks

Promotion• Pepsi Company has also become official sponsors

of Pakistan cricket

• Pepsi has launched a number of prize schemes to attract new customers.

• TPR(Trade Price Reduction) is a promotional strategy of Pepsi on ramzan and Eid. One case is free on buying 10 cases of Pepsi.

Slogans

Dil Mange abhi

Duniya hai dil walon ki

Made for cricket

Khana bane exiting

Segmentation, Positioning and Targeting

Segmentation: Dividing a market into distinct groups with distinct

needs, characteristics, or behavior who might require separate products or marketing mixes.

Targeting Consists of a set of buyers who share common needs

or characteristics that the company decides to serve Positioning:

The place the product occupies in consumers’ minds relative to competing products.

Involves implanting the brand’s unique benefits and differentiation in the customer’s mind.

Segmentation, Positioning and Targeting of Coke-

Cola

Segmentations

Coca cola segments its market on following factors:

1. GEOGRAPHIC SEGMENTATION It varies according to the taste and income level of the

people in that country. I.e.: third world countries are given low quality and taste.

Coke segments its products country wise and region wise.

2. CLIMATIC SEGMENTATION In coke marketing, main idea is to serve it cold, so we

that they focus on hot areas of the world.3. LOCALY SEGMENTATION In Pakistan the coke segments more in urban and

suburban areas as compare to rural areas

Targeting  Coca Cola doesn’t target a specific segment but

adapt its marketing strategy by developing new products.

Main consumers are 12-30 years old people; even if there is no specific product or communication for less than 12 or more than 30.

No occupation targeted but consumers are mainly students and family oriented people.

Age group from 18-25 that covers around 40% of total age segments.

No life style targeted but more and more busy life style and mobile generation (youth) are considered to be the most important part of Coke’s consumers.

Positioning

Coca Cola has strategically positioned itself within the world soft drink market.

Brand sells its products in 200 countries in world They use strategic positioning in order to have

the same image all around the world. Coca Cola has been successful by using Unique

Selling preposition as “Live the coke side of life”, related to joy and happiness.

When the name of Coke is mentioned, the first thing that comes into mind is fun and entertainment

Segmentation, Positioning and

Targeting of Pepsi

Segmentation

Pepsi has segmented their market keeping four major segmentation which are: Geographic Demographic Psychographic Behavioral

Targeting

Pepsi has historically targeted a young audience especially since the 1980s.

Many of their ads were usually aimed at teenagers and even younger groups by introducing fun, sports and music in their ads.

Pepsi also attracts other age groups not only teens.

Pepsi targeted the every class of Pakistan whether it is a Middle, Upper and lower class.

Pepsi targeted the South Asia Region through Cricket Sponsorship in that region.

Positioning

Firstly the Pepsi in America try to position its product for the society as whole and for the purpose of refreshment.

Pepsi’s goal is Attract a certain set of customers to buy the product by associating itself with young people who are energetic, fun loving and daring.

Low quantity of cafeen. Available in regular size.

SWOT analysis of Coca-Cola Strength Weaknesses Opportunities Threats

Strength

Coca Cola holds the largest beverage market share in the world (about 40%)

Coca Cola’ advertising expenses accounted for more than $3 billion in 2012 and increased firm’s sales and brand recognition.

Coca Cola serves more than 200 countries. The Coca Cola Company is the largest beverage

producer in the world and exerts significant power over its suppliers to receive the lowest price available from them

Weaknesses

Significant focus on carbonated drinks The firm is often criticized for high water

consumption in water scarce regions and using harmful ingredients to produce its drinks

Coca Cola currently sells more than 500 brands but only few of the brands result in more than $1 billion sales. Plus, the firm’s success of introducing new drinks is weak. Many of its introduction result in failures, for example, C2 drink.

Opportunities

Consumption of bottled water is expected to grow both in US and the rest of the world.

Coca Cola Company has an opportunity to further expand its product range with drinks that have low amount of sugar and calories.

Coca Cola will find it hard to keep current growth levels and will find it hard to penetrate new markets with its existing product portfolio. All this can be done more easily through acquiring other companies

Threats

Consumers around the world become more health conscious and reduce their consumption of carbonated drinks, drinks that have large amounts of sugar, calories and fat.

Water is becoming scarcer around the world and increases both in cost and criticism for Coca Cola over the large amounts of water used in production.

Legal requirements to disclose negative information on product labels. 

Coca Cola’s gross profit and net profit margin was decreasing over the past few years

SWOT Analysis of Pepsi

Strength Weaknesses Opportunities Threats

Strength

 PepsiCo has several hundreds of brands. PepsiCo serve customers in more than

200 countries. Successful marketing and advertising

campaigns. More than $2 billion spent on advertising.

Weaknesses

PepsiCo usually prices its products lower than its competitors.

The Coca Cola Company has the largest share market of beverages in the world and much stronger brand awareness than Pepsi, placing it at competitive disadvantage.

PepsiCo’s net profit margin is 9.7% compared to Coca Cola’s 18.55% and Nestlé’s 11%.

Opportunities

Due to increase in demand for healthy food and beverages.

Consumption of bottled water is expected to grow in future.

opportunity PepsiCo has in growing its revenue selling snacks as this market is also expected to grow.

Threats Consumers around the world become

more health conscious and reduce their consumption of carbonated drinks.

PepsiCo’s gross profit margin was decreasing over the past few years.

Some researches show that particular ingredients, consumed in extra large quantities, in some of PepsiCo products could cause cancer. For this reason, many governments consider to pass legislation that requires disclosing such information on product labels

Conclusion

Coke is the market leader with 54% market share. Pepsi is having only 46% market share Coke and Pepsi hold almost 75% the whole market. That Pepsi is the leading brand of PepsiCo, with 29%

market share of its total market share. Thumbs up is the leading brand of coke with market share

of coke-cola.

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