Operation Management

Organization----Pepsi

Topic-SWOT Analysis

Abstract
The marketing world is full of surprises. Who could imagine that Coca Cola would
be overtaken by Pepsi? If Coke could be overrun by Pepsi, it would be no
wonder that Pepsi might be overtaken by some other beverage. The need then is
to combine quality with ingenuity. Along with that, the reputation of the company
has to be kept robust. Today we live in a fast moving world where novelty and
newness count a lot. One cannot rest on ones laurels. Fresh efforts, newness of
approach must remain the cardinal principles of a well orchestrated marketing
strategy and the campaign must be relentless. A continuous bombardment in
advertisement would convince the clients that Pepsi is a part of their lives. In
order to live with style, Pepsi ought to be an essential ingredient of ones life. The
Pepsi is at its maturity stage and the sales of company are not growing very
rapidly. Company is 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.
Marketers of Pepsi can try to improve sales by improving one or more marketing
mix elements. They can cut prices to attract new users and competitors
customers. They can also launch a better advertising campaign or use
aggressive sales promotion to improve the sales. Thus, Pepsi is at its maturity
stage.

Introduction
Pepsi International is a world renowned brand. It is a very well organized
multinational company, which operates almost all over the world. They produce,
one of best carbonated drinks in the world. Pepsi is a symbol of hygiene, quality
and service, all over the world. Pepsi is producing Cola for more than 100 years
and it has dominated the world market for a long time. Its head office is in New
York.
MISSION STATEMENT
To be the world's premier consumer Products Company focused on convenient
foods and beverages. We seek to produce healthy financial rewards to investors
as we provide opportunities for 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 STATEMENT
To be the world's best beverage company. Being the best means providing
outstanding quality, service, cleanliness and value, so that their every customer
is contented and happy with their products. To increase the value of their
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shareholders investment through sales growth, cost control and wise investment
of resources.

Organizational background
The market in Pakistan is surely dominated by Pepsi. It has proves 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
their after Pepsi is going higher and higher. Pepsi is the choice soft drink of every
one. It is consumed by all age groups because of its distinctive taste. Compared
with other Cola in the market, it is a bit sweeter and it contributes greatly to its
liking by all. 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,
is successfully maintaining is No.1 position in Pakistan. 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, after some years, 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.

Major characters
Brands of Pepsi are as follows:1. Frito-lay brands
2. Pepsi-cola brands
3. Gatorade
4. Tropicana Brands
5. Quaker Brands
Frito-lay brands
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Frito-Lay offers a wide variety of fun foods and sensible snacks to satisfy your
snacking needs. From mouth-watering potato chips and corn chips, to hardy
pretzels, and savory cookies, Frito-Lay has a snack for you!
Pepsi-cola brands
Pepsi-Cola most commonly called Pepsi, 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. Similar to Coca-Cola, its major rival,
Pepsi was originally intended to cure stomach pains. There are several variants
of Pepsi, including Diet Pepsi (the most popular variant), Pepsi Vanilla, and
outside the United States, Pepsi Max.
Products
Pepsi-Cola
Caffeine Free Pepsi
Diet Pepsi
Mountain Dew
Diet Mountain Dew
Pepsi Vanilla
Lipton Brisk (Partnership)
Lipton Iced Tea(Partnership)
Dole juices and juice drinks (License)
Aquafina purified drinking water
SoBe juice drinks, dairy, and teas
Pepsi-Cola
Pepsi-Cola, most commonly called Pepsi, 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.There are many variants of Pepsi,
including Diet Pepsi, Pepsi Max, Pepsi Samba, Pepsi Blue and Pepsi Gold.

Pepsi-Cola
Type Cola
Manufacturer PepsiCo, Inc.
Country of Origin USA Introduced 1903
Related products
Coca-Cola

Case presentation
SWOT analysis
Strengths: The soft drinks market in Pakistan enjoyed dynamic growth over the
review period in both volume and current value terms. Carbonates dominate the
market in both the on-trade and off-trade with the lion's share of sales.
Carbonates have become part of the culture in Pakistan and multinational
companies have maintained their standards over the years to provide consumers
with high-quality carbonated drinks. Off-trade sales of carbonates are higher than
those of the on-trade but both achieved strong growth over the review period
Weaknesses: Liquid concentrates and powder concentrates are both seasonal
categories in the market and their sales peak in the summer in Pakistan. Both
Rooh Afza and Jam-e-Shirin are traditional sandalwood drinks in Pakistan which
are highly regarded by consumers. These drinks can be found in every home in
Pakistan, especially in rural areas, throughout the summer and are the mainstay
of liquid concentrates
Opportunities: The government of Pakistan has reduced excise taxes to
encourage soft drinks manufacturers and importers. The government also
reduced other applicable taxes to promise more profits not only for soft drinks
manufacturers already in the market but also to attract potential soft drinks
manufacturers to invest in Pakistan. Tax reductions proved extremely beneficial
to the soft drinks market in Pakistan and certainly encouraged and attracted
multinational companies to invest in the country's soft drinks industry.
Threats: Increasing health and hygiene awareness among Pakistanis has
greatly increased sales of fruit/vegetable juice products. Both the government
and the media have started health awareness campaigns to make Pakistanis
realize that consumption of fruit/vegetable juice is as essential as eating food.
Fruit/vegetable juices are doing very well in both urban and rural areas. On the
other hand, health and hygiene awareness has also led to increased sales of
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bottled water in Pakistan. Previously bottled water was targeted only at major
cities where consumers are more health-conscious and aware of the difference
between bottled water and tap water. Nowadays, health-conscious rural
inhabitants also drink bottled water due to health concerns.
SWOT Analysis of PEPSI--SWOT Analysis, which is based on thorough review
of the business (corporation, product category competition, customers and
products), identities and evaluates the internal strengths and weakness of the
companies well as its external threats and opportunities. The marketing mix is
driven by the results of the SWOT analysis.
STRENGTH
Demand of Pepsi is more than its competitors.
Company has a very established name and a good reputation.
Pepsi has large market share than its competitors.
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.
Pepsi is an international company and it has a very strong position
internationally.
The environment of factory is very good and attractive.
Pepsi spends a lot of budget on its advertising.
WEAKNESSES
Pepsi does not offer any sort of incentive or discount to its retailers.
Pepsi target only young customers in their promotions.
Crown of the disposable bottle is not good.
Demand of disposal bottle is declining.
Pepsi tin pack is not available in far off rural areas.
Pepsi is not considering many potential outlets like hotels, college canteens etc.

OPPORTUNITIES---Company may start entering rural areas also. The company

may also diversify its business in some other potential business.Increased
interest of people in musical groups, cultural shows and sports has provided an
opportunity for Pepsi to increase its sales through them.
THREATS---The main competitor of the company is the Coca Cola. At the
international level, Pepsi has a very strong competition with Coke. 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 in creasing which is a big threat to the company.

Management Outcome
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.
There are three types of customers
1. Consumer
2. Business
3. Government
COMPETITOR: He is the person who is selling the same type of product in the
market. The marketing concept states that to be successful, a company must
provide greater customer value and satisfaction than its competitors do. Pepsi
has a tough competition with Coca Cola while it faces a little competition with the
local producers like RC Cola, Shandi Cola etc. The local producers hardly affect
the sales of Pepsi in the market. There are different types of competitor in the
market. Some of them in which our product lies are discussed below:
CHANNELS OF DISTRIBUTION--The Pepsi uses the following two channels for
the distribution of their products.
Indirect Distribution--Indirect distribution involves agency holders e.g. Riaz
Bottlers Pvt. Ltd. Lahore franchise has divided its region i.e. Lahore and Kasur
districts in two categories.
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Local Zone--These are 62 agencies distributing Pepsi Products (250ml Sd) only
around Lahore in their respective allocated sub zones.
Out Station Zone--17 dealers have been appointed by the bottlers for far distant
places and in out skirts of Lahore and Kasur the dealers involved in direct
distribution are only authorized to sell 250 ml (STD) bottle of Pepsi, Team and
Marinda.
Direct Distribution--The factory vehicles operate on 45 direct routes in Lahore
selling non-returnable bottles Litter, Pet and Can.
Behavioral Base
It is how people perceive a specific product, in short psychological analysis of a
product. Pepsi all over the world is recognized as a quality drink and therefore
people drink it without any hesitation whenever they are thirsty or otherwise. So
marketers of Pepsi have made it a drink for all people and for diabetic people
they introduced diet Pepsi.
Cognitive Base
It pushes and pulls the consumer. If the outlook of Pepsi bottle is desirable and it
attracts the consumer, he will buy it even if he isnt thirsty.
TARGET MARKET
The market which is focused by the producer is called the target market.
Targeting is to focus on the target market to attract the customers.
CHARACTERISTICS OF TARGET MARKET
The target market should have some following features.
Accessible
It means that the target market which is focused should be accessible or easily
approachable.
Substantial
The target Market should be substantial. It should have a specific size where
strategies can be made and implemented.
Measurable
One should be able to measure the demand in the market.
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 Comparable
The producer should identify that needs of different customers are different.
Profitable--The target market should be profitable for the producer.
MARKETING STRATEGIES--There are different marketing strategies which are
applied in targeting. Some of these strategies which Pepsi follows are discussed
below:
Mass Marketing----Big firms or companies say that everyone is their buyer
whether they belong to rural or urban area, big or small country, rich or poor,
adults and small children etc. Pepsi is mostly used by the young generation but it
claims that it is moving towards mass marketing.
CHANNELS OF DISTRIBUTION
The Pepsi uses the following two channels for the distribution of their products.
1. Indirect Distribution--Indirect distribution involves agency holders e.g. Riaz
Bottlers Pvt. Ltd. Lahore franchise has divided its region i.e. Lahore and Kasur
districts in two categories.
Local Zone---These are 62 agencies distributing Pepsi Products (250ml STD)
only around Lahore in their respective allocated sub zones.
Out Station Zone--17 dealers have been appointed by the bottlers for far distant
places and in out skirts of Lahore and Kasur the dealers involved in direct
distribution are only authorized to sell 250 ml (STD) bottle of Pepsi, Team and
Marinda.
2. Direct Distribution---The factory vehicles operate on 45 direct routes in
Lahore selling non-returnable bottles Litter, Pet and Can.
SPECIAL POINTS----Other than these some special points are also being
looked after by direct sales vehicles such hotels restaurants, public parks, big
and reputed super stores etc. At Avari, Pearl continental, village, Seas
magnificence etc. Pepsi Cola directly distributes the products.

Conclusion
In Pakistan Pepsi is the most liked soft drink especially by young generation so
the Pepsi cola company has devised such marketing strategy which attracted
them. For this reason they started monitoring the habits of the generation. What
they saw was that the students were crazy about cricket and usually liked to
idealize them so in order to increase their sales the Pepsi cola company paid
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high amounts of money to the cricketers to act as their spokes men. Pepsi is a
well renowned company and it has maintained its position well by understanding
the client psychology, by ensuring quality, by introducing ingenuity in products, by
enlarging its product base, by keeping economic factors in view and by intense
and jazzy 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.

Discussion
PepsiCo has a corporation-wide commitment to the environment. PepsiCo is
committed to providing a safe and healthy environment for their employees as
well as for the community. PepsiCo is dedicated to designing, constructing,
maintaining, and operating facilities that protect their people and their physical
resources. PepsiCo commitment to reducing the impact of their businesses on
the environment through conservation, recycling, and energy use programs that
promote clean air and water and reduce landfill waste. PepsiCo's dedication and
commitment to the environment is stated in their "Worldwide Code of Conduct".
The "Worldwide Code of Conduct" defines PepsiCo's commitment based on the
following environmental principles:
1. Business is conducted by complying with all applicable laws and regulations
and provides a safe and healthy environment.
2. Minimizing the impact of our businesses on the environment through methods
that are socially responsible, scientifically based and economically sound, such
as recycling and conservation.
3. Developing programs that promote clean air and water, energy conservation,
and reduce land fill waste.
4. By supporting programs that educate, train and motivate employees to help
the environment.
5. By cooperating with different organizations and governments to find solutions
that reduces pollution and by supporting environmental policies
Exhibits
From the 1930s through the late 1950s, "Pepsi-Cola Hits The Spot" was the most
commonly used slogan in the days of old radio, classic motion pictures, and later
television. Its jingle (conceived in the days when Pepsi cost only five cents) was
used in many different forms with different lyrics. With the rise of radio, Pepsi
utilized the services of a young, up-and-coming actress named Polly Bergen to
promote products, oftentimes lending her singing talents to the classic "...Hits
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The Spot" jingle. Through the intervening decades, there have been many
different Pepsi theme songs sung on television by a variety of artists, from Joanie
Summers to The Jacksons to Britney Spears. (See Slogans) In 1975, Pepsi
introduced the Pepsi Challenge marketing campaign where PepsiCo set up a
blind tasting between Pepsi-Cola and rival Coca-Cola. During these blind taste
tests the majority of participants picked Pepsi as the better tasting of the two soft
drinks. PepsiCo took great advantage of the campaign with television
commercials reporting the results to the public.
References
http://www.pepsi.com/
www.pepsiworld.com

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