Professional Documents
Culture Documents
MODULE:
Principle of Marketing
GROUP ASSIGNMENT:
Report
(Scanning Environment and Marketing Research based field Activity)
COURSE INSTRUCTOR:
Mr. Imran Ejaz
SUBMITTED BY:
11338
11353
11321
11315
11316
PROGRAM:
M.com 2-A
INTRODUCTION TO PEPSI
Pepsi-Cola, most commonly called Pepsi, is a world renowned brand. Pepsi is producing
Cola for more than 100 years. It is a soft drink produced by PepsiCo which is sold worldwide
in stores, restaurants and vending machines.
The brand was trademarked on June 16, 1903, though the drink was first made on August
28, 1898, by pharmacist Caleb Bradham.
PepsiCo divisions operate in three major US and international businesses: beverages, snack
foods, and restaurants.
The corporations increasing success has been based on high standards of performance,
marketing strategies, competitiveness, determination, commitment, and the personal and
professional integrity/honesty of their people, products and business practices.
PEPSI IN PAKISTAN
Pepsi has proven itself to be the No.1 soft drink in Pakistan. Now days Pepsi is recognized as
Pakistanis National drink. In 1971, first plant of Pepsi was constructed in Multan, and from there
after Pepsi is going higher and higher. It is consumed by all age groups because of its unique taste.
Compared with other Cola in the market, it is a bit sweeter. Consumers survey results explain the
same outcome and Pepsi has been declared as the most wanted soft drink of Pakistan.
Pepsi's greatest rival is Coca Cola. Coca Cola has an international recognized brand. Cokes basic
strength is its brand name. But Pepsi with its aggressive marketing planning and quick
diversification in creating and promoting new ideas and product packaging. In coming future Pepsi
is also planning to enter into the field of fruit drinks. For this purpose it has test marketed its mango
juice in Karachi for the first time.
When Pepsi was introduced in Pakistan, it faced fierce competition with 7up, lemon and lime drinks,
which was established during 1968, in Multan. Pepsi introduced its lemon and lime, "Teem" to
compete with 7up. It successfully, took over 7up, and this enhanced Pepsi's profits and market share.
In Pakistan, Pepsi with 7up enjoys 70% of the market share where as the coke just has 20% markets
share.
Pepsi is operating in Pakistan, through its 12 bottlers all over Pakistan. These bottlers are Pepsi's
strength. Pepsi has given franchise to these bottlers. Bottlers, produce, distribute and help in
promoting the brand. Pepsi also launched its fast food chain KFC i.e. "Kentucky Fried Chicken.
Total annual sale of soft drink in Pakistan 120 million cases.
Pepsi annual sales in Pakistan 75 million.
Market share of Pepsi 65%.
Consumption growth 1.7 % per year
However they have produced PEPSI COLA, MIRINDA, TEEM, 7UP, MOUNTAIN DEW, DIET
7UP, DIET PEPSI, LAYS, KURKURE, AQUAFINA, PEPSI TWIST AND TROPICANA
JUICES(introduced in Karachi only) Pepsi max diet Pepsi, but Pepsi Twist was the product which
failed to capture market how, a brief look of Pepsi twist and causes & effects are given below:
PEPSI TWIST
Marketers need to be good at building relationships with customers, others in the company and
external links. To do this effectively, they must understand the major environmental forces that
surround all of these relationships. A companys environment consists of forces outside marketing
that affect marketing managements ability to build and maintain successful relationship with the
target customers. The environment continues to change rapidly. By carefully studying the
environment, marketers can adapt their strategies to meet new marketplace challenges and
opportunities.
Some of the external and internal environmental factors on that particular company or product that
affect the marketing trend of the company are as follows:
EXTERNAL ENVIRONMENT
The macro environment consists of the larger common forces that affect the microenvironment. The
external factors are not under the control of the marketers; they can just observe them and make
strategies in light of these factors. Some of these factors are given below:
1. Demographic factors.
a. Aging
b. Education
c. Population Distribution
d. Population Density
DEMOGRAPHIC FACTORS
Aging
People in the majority of countries still appear to favor carbonated drinks due to health conscious
such as fruit juice and mineral water; where as in the above figure it shows how aging factors
contribute towards drinks.
Education
Education is a factor that affects the company / product so company has to make promotional
strategies keeping in view the customer level. If the percentage of education is high in a country then
through advertisements people can be made well aware of their product and can convey their
message easily. Promotion and education has a direct relationship.
Population Distribution
Population distribution means how much population lives in urban areas and rural areas. In Pakistan
35 % population resides in urban areas and 65% population lives in rural areas. Pepsi is focusing on
urban areas as people there are more inclined towards such beverage while people in rural areas are
more inclined drinking lassi and desi drinks.
Population Density
It means number of people in one square km per area. Karachi has the largest population density and
Islamabad has less population density in Pakistan. Pepsi sales are more in Karachi as compared to
the sales in Islamabad.
ECONOMIC FACTORS:
1. Income and Per Capita Income.
2. Inflation
3. Consumption Behavior.
4. Income Distribution.
5. Aggregate Demand.
6. Aggregate Supply.
7. Economic Policies.
a. Fiscal Policy.
b. Monetary Policy.
c. Price Policy.
d. Income Policy.
Income and Per Capita Income
If the income level or per capita income of the people increases, it will have a positive effect on the
consumption of Pepsi.
Inflation
If the country faces inflationary trend in the market, the price of the Pepsi will ultimately increase
which will lower its demand.
Consumption Behavior
Pakistan is a consumption oriented society. Due to demonstration effect the people are more inclined
towards consumption than saving. So the people of Pakistan spent heavily on food items. Hence
Pepsi has a good market share in the present circumstances.
Income Distribution
It means how much is in the hands of rich and poor class. In Pakistan 10% rich people posses 93%
of wealth and 90% people posses 7% of wealth. If there is balanced distribution of income in the
country, the consumption of the people will increase hence increasing the sales of beverages as well.
Aggregate Demand
In case of Pepsi, collective demand of the product increases in the season of summer as the hot
weather makes the consumers want to drink more.
Aggregate Supply
In summer season to cope up with the increasing demand they have to increase the aggregate supply
of their product.
Economic Policies
Some of the economic policies which can affect the market of Pepsi are discussed below:
Fiscal Policy
It is the policy of taxes. If heavy tax is levied on Pepsi then its price will rise having negative
effect on its consumption.
Monetary Policy
Monetary policy is made to restrict or increase the supply of money in the market. If policies
are made to restrict the flow of money in the market, inflation can be controlled hence
increasing the real income of the people which will ultimately affect the consumption of
Pepsi.
Price Policy
If price of Pepsi is increased its demand will decrease and vice versa.
Income Policy
If income of the people will increase their purchasing power will increase and hence
increasing the market share of Pepsi.
PHYSICAL FACTOR:
1. Region.
2. City Size.
3. Climate.
4. Infrastructure.
Region
Pakistan is divided into different geographical regions. Marketing and sales of Pepsi is different in
different geographical regions. In hot areas its demand is more.
City Size
The cities which are heavily populated the consumption of Pepsi is more.
Climate
Pepsi is more suitable for humid or hot weathered countries like Pakistan. It is a source of
refreshment when a person is thirty due to the hot weather.
Infrastructure
Roads are the basic need for transportation of Pepsi from one place to another. Pepsi cannot open
factories in every city of Pakistan so it has to transport it to other cities where Pepsi is demanded.
TECHNOLOGICAL FACTORS:
Research and Development
Through research and development quality of the product can be improved or better techniques or
machinery can be developed which can increase the production. When technology is advance the
supply of the product increase hence the company experiences growth in their business.
Social Responsibility
Pepsis social responsibility is to provide its customers with clean and hygienic product so to do this
they have increased the use of disposable bottles.
INTERNAL ENVIRONMENT
CUSTOMERS:
There are three types of customers
1. Consumer
2. Business
3. Government
Pepsi main focus is the consumers which are the end users. Pepsi has to make its marketing
strategies keeping in view the consumer buying behavior. To forecast the behavior of the consumer
is a business problem. Physical aspect of the consumer can be satisfied but it is difficult to satisfy the
consumer psychologically. Consumer buying behavior is affected by certain factors like Cultural
factors, Social factors, Personal factors and Psychological factors. So the producer should keep these
factors in Mind while promoting their product so that they can acquire the customer and increase
their market share.
There are different consumers in a society whose behavior is not the same. Every consumer has a
different perception of different products. Some consumers are impressed by one quality of the
product which may be in the view of other consumer not that impressive. So to deal with different
consumers in a society one should know about the consumer buying behavior process which may
help in making a true picture of their product in the mind of the consumers.
As the target customers of Pepsi is young generation, so Pepsi has more brand
loyal customers.
Most of the customers are satisfied with the price of the Pepsi.
The location of the Pepsi plant is utilized that all major markets of Lahore are
within the reach of the Pepsi plant within 30-45 minutes.
Pepsi does not offer any sort of incentive or discount to its retailers.
Pepsi target only young customers in their promotions.
Pepsi is not considering many potential outlets like hotels, college canteens
etc.
WEAKNESSES
OPPORTUNITIES
Increased interest of people in musical groups, cultural shows and sports has
provided an opportunity for Pepsi to increase its sales through them.
Coke has started its advertisements more effectively to increase their demand
and it is a very strong threat for Pepsi.
Cola drinks are not good for the health so the awareness level of the people is
increasing which is a big threat to the company.
THREATS
9. If Pepsi Twist came back to market, will you use it again 14.3 5 says definitely,
52.4 % are not sure, 33.3 % says never.
CONCLUSION
Pepsi is a well renowned company and it has maintained its position well by understanding the client
psychology, by ensuring quality, by introducing creativity in products, by enlarging its product base,
by keeping economic factors in view and by strong and smart advertisements.
Whenever and where ever there is a spotlight event, Pepsi must figure in, like the one day
international cricket matches between India and Pakistan many other such occasions. The key word
for success in the Marketing World is to remain in the spotlight and that is what Pepsi is doing.
But why Pepsi Twist Failed may be idea may be Good but company may overestimate the market
size, Actual product may be poorly designed, It may incorrectly positioned, Launched at wrong time,
Too High Price, Poor Advertising.
SUGGESTIONS
The marketing world is full of surprises. Who could imagine that Coca Cola would be overtaken by
Pepsi? If Coke could be filled by Pepsi, it would be no wonder that Pepsi might be overtaken by
some other beverage. The need then is to combine quality with creativity. Along with that, the
reputation of the company has to be kept strong.
Today we live in a fast moving world where innovation and newness count a lot. One cannot rest on
ones success. And companies are doing a lot of promotional activities to let the product remain in
the market. It holds a large share of the market and whenever the sales state declining, the company
can improve it by different promotional activities.
However marketers of Pepsi Twist should improve sales by improving marketing strategies e.g. they
can cut prices to attract new users and competitors customers, can also launch a better advertising
campaign or use aggressive sales promotion to improve the sales.
The requirements of different age groups are different. Pepsi should target that age group that
consumes it the most and make promotional strategies according to their behavior. Because
consumer view a brand name as an important part of the product. Branding can add value to the
product. A name, term, sign, symbol or design or a combination of these intended to identify the
goods and services of one seller or group of seller and to differentiate them from their competitors.
QUESTIONNAIRES
You are kindly requested to complete this questionnaire by encircling
bullets so that we can get your perspective for our knowledge.
1NAME _______________________
2
AGE
20 to
30 to
40 to
50 to
Gender.
Male.
Female.
Education.
Primary/Matriculation.
Intermediate.
30.
40.
50.
above.
Bachelors.
Master/M Phil.
Other.
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
6Salary is an important negotiator but by handling it wrong you
can blow the Job offer or go to work at far less than you might have
gotten?
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
7Performance review is one of the factors that lowers the
morale/confident or contributes to factors leading employee turnover?
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
8Do seniors encourage and allow working to the best of our
abilities?
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
9Motivated employees always look for the better way to do job
and are more quality oriented and productive/fruitful?
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
YES.
NO.
11Is it possible for an employee to "fast track" or find short
cut to achieve promotion unofficially?
YES.
NO.
12Effective employee management and leadership allow you to
capitalize on the strengths of other employees and their ability to
contribute to the accomplishment of work goals.
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
13CRITICAL
PSYCHOLOGICAL STATES
JOB
CHARACTERISTICS
Skill
Variety
Task Identity &
Task
Significance
Autonomy
& Feedback
Impact
Experienced
meaningfulness
Experienced
Responsibity
outcomes
Knowledge of
actual results
for
the
20%
40%
60%
80%
to
to
to
to
40%
60%
80%
above.
14Many businesses find the over 60's age group hard to reach with
traditional marketing and advertising, but Seniors Business Discount
Card scheme makes it easy.
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
15
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
17Teamwork involves working confidently within
contributing your own ideas effectively, taking a
responsibility.
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
a group,
share of
Agree.
Strongly Agree.
Neutral.
Disagree.
Strongly Disagree.
Thank you for giving your precious time.
___________________________
CONCLUSION
So a Product may go to Decline Stage if
Taste is not according to Customer Need
An Idea may be Good but company may overestimate / underestimate the market
size.
Actual product may be poorly designed.
It may incorrectly positioned
Launched at wrong time
Too High Price
Poor Advertising