A Brand & An Empire

Presented by Yusuf Aktan, Steve Gao, Kyron Richard &

Sucharita Yellapragada
Our Recommendation
Continue to devote resources to the carbonated beverage
market.
Invest heavily into emerging markets.
Establish separate brand identities for subsidiary companies.
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Customers
Product Rivalry Company Proposal
PepsiCo is a major player
Huge consumer base including customers from
Tropicana
Quaker Oats
Frito-Lay
Customers want healthy options
Balance a reduction of sodium, added sugar, and saturated
fats in beverages and snacks
Keep continuity with taste and customer experience
Important conditions to consider
Half of current revenue comes from outside US
India and Middle East are quickly growing regions.
Clear market leader in snacks worldwide
Focuses on volume growth, revenue growth, and growth in
operating profit

How to serve our customers
Retailers: served by Pepsis packaged goods business
Direct Consumers: served by restaurant business
Both businesses involve inexpensive consumer products
Major markets include:
supermarkets
mass merchandisers
smaller retail outlets (gas stations)

Pepsi in relation to families
Children are being cut off from soft drinks
Full calorie sodas removed from American schools in 2006
Diet sodas are healthier and maintain brand recognition
Advertising to children might be restricted
A conflicting company portfolio

Two types of products within Pepsi for consumers to buy
Fun for You: snacks, chips, and sodas (Pepsi, Doritos)
Good for You: nutritious foods and drinks (Naked, Stacys
Chips)
Nutritious foods and beverages that enjoyed a reputation for
health and wellness among consumers
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Customers Product Rivalry Company Proposal
Fun For You products made Pepsi
Key brands like Mountain Dew, Doritos, and 7up made Pepsi
Even today, Pepsi Cola is a major source of revenue
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Soft Drinks are not market leaders
Current industry trends show that the soft drink category is weakening due to taste
changes and government regulations.
Healthy trends are popular across the market and will influence product popularity.
12
Diversify Pepsis product offering
Maintain high-revenue with FFY Products
Focus on growing healthy brands
Diversify, and limit, future product portfolio to match consumer
tastes
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Customers Product
Rivalry
Company Proposal
The conditions of market
Essentially an oligopoly, with 4 main competitors
Coke
Dr. Pepper-Snapple Group
Mondelez (formerly Kraft)
Nestle
Considerable barriers to entry prevent a new competitor from taking
significant market share.
15
Pepsi has the global food advantage
Closest market competitor is 25% behind in food market.
Food suppliers have low bargaining power without an affect on price.
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Short life cycles require innovation
Pepsi has remained an industry leader through innovation
1970: Globalization & Acquire Food Companies
1980s: Acquire Bottling Companies
1990s-2000s: Acquire Beverage Companies
Now: Produce fun and healthy foods
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Customers Product Rivalry
Company
Proposal
Pepsis SWOT in the industry
Strength: Mainly ubiquity and brand recognition. Multiple
acquisitions offer a wide platform to develop GFY business.
Opportunities: Invested in numerous smaller premium brands
and new acquisition offer the possibility of an extended
presence in GFY market.
Threats: Manufacturers are facing tougher regulations
Weakness: Unhealthy connotations associated with Pepsi brand.
Unique positioning of subsidiaries
Subsidiaries such as Quaker Oats and Naked Juice are not
directly associated with the Pepsi Brand by consumers.
These brands enable Pepsi to apply different channels of
distribution
Possible ingredients in GFY market
Categories that are prevention by instant gratification
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Possible ingredients in GFY market
Ingredients that promise long term health benefits
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Making headway in the HW market
Investment in Naked Juices and other companies reinforced the
companys offering in the HW market.
Continue expanding with products like Pepsi Next, natural
sweetened with Stevia.
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Customers Product Rivalry Company
Proposal
Our Recommendation
Continue to devote resources to the carbonated beverage
market.
Invest heavily into emerging markets.
Establish separate brand identities for subsidiary companies.
A Brand & An Empire
Presented by Yusuf Aktan, Steve Gao, Kyron Richard &
Sucharita Yellapragada