Introduction
PepsiCo, Inc., American food and beverage company which is one of the largest organizations in the world, with products sold in over 200 countries and 185.000 employees PepsiCo revenue for the twelve months ending September 30, 2022 was
In 1886, Caleb D Bradham (1866-1934), a pharmacist in New Bern, North Carolina, invented the first Pepsi-Cola called "Brad's Drink" By 1898, Bradham gave the name Pepsi-Cola to his cola-flavored carbonated beverage and Pepsi Corporation was established The organization's headquarter is located in Purchase, New York, USA Pepsi thrived for the next two decades In 1938, Walter Mack, the new president of Pepsi-Cola, introduced a new ad for a 12-ounce Pepsi bottle that featured the rhyming song "Nickel, Nickel." This song quickly gained popularity and was recorded in 55 different languages.
During the 1950s, massive advertising campaigns and sales promotions enhanced Pepsi-Cola's net earnings 11-fold, making it the primary competitor of Coca-Cola The company was renamed PepsiCo when Frito-Lay, Inc and the Pepsi-Cola Company merged in 1965 By 1976, Pepsi-Cola had become the only brand of carbonated soft drink with the highest sales in US supermarkets, and it has remained so to this day Pepsi was the leading beverage brand purchased by many people in the early 1980s
Besides the billion-dollar Pepsi brand, this corporation owns many other well-known soft drink brands, including Mirinda, 7UP, Mountain Dew, and Aquafina mineral water.
PepsiCo's Vision Statement: “Be the global leader in convenient foods and beverages by winning with a purpose.”
PepsiCo’s Mission Statement: “Creating more smiles with every sip and every bite.”PepsiCo’s Core Values:
“PepsiCo is committed to delivering sustained growth through empowered people acting responsibly and building trust.”
Current Marketing Situation
Internal environment
For the fiscal year 2022, the company now anticipates organic revenue growth of 12 percent (up from 10 percent) and core constant currency EPS growth of 10 percent (previously 8 percent).
In line with its earlier forecast for 2022, the company continues to anticipate:
• A core annual effective tax rate of 20%;
• A total cash return to shareholders of about $7.7 billion, which is made up of $6.2 billion in dividends and $1.5 billion in share repurchases, is the core annual effective tax rate.
Similarly, based on current market consensus rates, the Company now anticipates a reported net revenue and core EPS growth headwind of about 2.5 percentage points (up from 2 percentage points).
Based on this presumption and the above estimate, 2022 core EPS of about $6.73 (previously: $6.63), an increase of roughly 7.5 percent (formerly 6 percent) over 2021 core EPS of $6.26.
On August 18, 2022, Pepsico announced the #BetterWithPepsi to Gridiron football (known as North American football or, in North America, simply football, is a family of football team sports played in the United States and Canada) campaign with Pepsi Zero Sugar available at soccer-themed venues The new appearance of this campaign immediately received a large reception from the masses in general and especially football fans in particular Launched in PURCHASE, N.Y, Pepsi makes sure fans everywhere know that watching football they can enjoy their favorite game with a refreshing ice-cold sugar-free Pepsi with #BetterWithPepsi.
Pepsi considers the weekly home soccer experience a must for fans across the country who do not even want to leave their seats for a moment because they don't want to miss the game with perfect shots In this campaign, Pepsi launches a giant Pepsi GametimeFridge TV with an advanced 55-inch 4K LED display and a 16-can beverage refrigerator to store ice-cold Pepsi products including unsweetened Pepsi For those watching football who just want to be able to quench their thirst with a cool can of Pepsi in the middle of the game but still do not miss a moment in the game, this is their solution.
“Unapologetically enjoy a full day of football watching every weekend without having to miss any of the action,” Kaplan- the chief marketing officer of PepsiCo said in a statement The fridge was designed in partnership with Vayner Media, a New York-based media agency With the touch of a button, the TV screen will gently slide from center to right to reveal ice-cold Pepsi cans in a modern wall-mounted refrigerator under the smart TV A dream product of sports fans in general and football in particular For those curious about the Pepsi Gametime Fridge TV, the brand will award the fridge to one lucky watcher in a quality sweepstakes Players will share articles about the football season and tag Pepsico The #GametimeFridgeTV and #PepsiSweepstakes hashtags are widely disseminated on the twitter and Instagram platforms.
Products made by Pepsi-Cola were created in the backdrop of an industrial civilization where a lot of people consume fatty meat and quick food, making Pepsi an excellent choice Good refreshment, good digestion, anti-hunger, and against the sensation of too much meat in the mouth; yet, it is not as addictive as alcohol Convenient product; lifts the lid to enjoy instantly.
In order to increase the market for diet beverages, Pepsico also produces a Pepsi for overweight persons Pepsi has introduced diet Pepsi products with less sugar.
Glass bottles, plastic bottles, and cans with varied volumes are all featured on Pepsi's packaging Complete details on the MFG-EXP, the ingredients, and the location of manufacture are included on the Pepsi packaging Customers frequently consider these aspects before purchasing goods.
The world's first plastic bottle created entirely from renewable energy and leftovers from food processing was developed by Pepsi and released recently Through a variety of conversion processes, Green-Pet bottles are made from biological materials like maize husks, grass, etc.
Ingredients of the product from water, flavor, sugar, CO2, are prepared with modern technological processes Moreover, the standardization of production procedures, the quality of the final product, and regional distribution networks are mostly carefully planned to guarantee that drinking a bottle or can of Pepsi at home also increases people's emotions Feeling cool, energizing, and delightful like drinking just after purchasing.
To manufacture Green-Pet bottles, Pepsi also utilizes leftovers from the food production process, such as potato peels, orange peels, and oat husks The function and design of this kind of bottle are identical to those produced from petroleum. b Price
Pepsi's pricing strategy to break into the industry: Rather than using a low price strategy to filter the supply chain, Pepsi decided to employ a relatively low price strategy to penetrate the market for new goods in an attempt to capture a significant client base a huge consumer base and a huge market share.
Discount pricing: Pepsi will change its pricing to reward customers who purchase in advance, buy in large quantities, and pay cash A cash discount is a discount for customers who buy and pay immediately Quantity discounts are discounts for customers who buy supplies.
According to this pricing strategy, Pepsi goods and products are priced differently based on their individual prices.
Whilst also implementing this pricing strategy, the business expects to close the gap between regular prices and the discounted holiday prices PepsiCo believes that by doing this, people will purchase more soft drinks on a daily basis, not just during the holidays. c Place (Distribution)
PepsiCo distributes its products to customers through a global network In this component of the marketing mix, locations for distribution and sales are taken into account PepsiCo’s places for distribution are as follows:
Businesses now use distribution middlemen to deliver goods to final customers in the market This aids in cost savings for enterprises but has little impact on scaling.
Through these resellers, PepsiCo also connects with consumers Despite being a major in the beverage sector with profitable business potential, PepsiCo instead depends on a massive distribution network to reach consumers with its products. d Promotion
PepsiCo advertises its goods to engage in the intended audience The company's marketing communications plans and methods are covered in this component of the marketing mix The PepsiCo promotional mix includes the following strategies, listed in order of importance:
Advertising Sale promotion Direct marketing Public relations
PepsiCo uses advertising as its main marketing communication strategy For instance, the business is well-known for using famous people as brand ambassadors to advertise its products in print, radio, television, and online.
Micro Environment
Franchise bottlers, independent distributors, and retailers are some of the clients Pepsico gives its bottlers exclusive licenses to market and create specialized beverage goods branded with our trademarks in a particular region These agreements detail the payments that our bottlers must make for Aquafina royalties, concentrate, and full goods, as well as the production procedures necessary to ensure the quality of the final product
Sales to Wal-Mart Stores, Inc represent approximately 10% of our global net revenue.
PepsiCo segmentation, targeting and positioning (https://research-methodology.net/pepsico-segmentation-targeting-and-positioning-2/)
2.2.2 SupplierSuppliers play a significant role in the micro environment because they supply the ingredients and packaging for Pepsi To ensure that their suppliers are abiding by the appropriate rules and laws in the nation in which they are conducting business and selling, PepsiCo holds them to the same standards of honesty To ensure the highest level of quality throughout their distribution chain, they also offer training.
2.2.3 Competitors Markets where enterprises compete fiercely exist On the basis of cost, value, selection, and efficient distribution, PepsiCo competes with national, international, and private label producers Effectively promoting current items and introducing new ones are the main ways to succeed in this cutthroat environment Companies think that the ability to compete successfully is a result of the power of brands, innovation, and marketing, as well as the excellence of our goods and the adaptability of our distribution network.
Frito-Lay competes with local, regional, national, and international snack companies on matters of pricing, quality, variety, and distribution despite owning a strong leadership market position in the global snack business PepsiCo is concentrating on The Coca-ColaCompany, who is our main rival in the beverage sector (CSI market 2022)
Macro Environment
Due to technological advancements, Pepsi and many other companies in the same industry have innovated and applied technology to their manufacturing processes, and Pepsi is no exception They have a production chain that includes many high-tech machines that ensure the quality of each unit of product It keeps humans from making mistakes Pepsi can produce the number of Pepsi bottles to satisfy customer demand by machines that can vastly increase the number of products that can be manufactured at any given time Customers of Pepsi can set a high standard for Pepsi products.
In order to pursue a digital world, Pepsi has introduced an e-commerce platform for Pepsi's consumers called Pep's Place, which is an online basket where customers can order their favorite Pepsi drinks and some food that they have added This approach is effective in attracting consumer demand, maintaining brand loyalty and improving profit during the pandemic This has demonstrated that Pepsi doesn't want to lose competitive advantages to competitors; thus, focusing on digital marketing and operations is a wise goal.
One of the elements that Pepsi has handled in almost every aspect to ensure that every employee has a suitable and fair workplace is employment culture They provide a multicultural workplace and encourage a healthy work-life -balance to let their employees have more time for personal pursuits or time with their families Working in a inspirative environment such as PepsiCo, employees will endeavor to provide a high level of labor productivity.
The population of the world is rising quickly The world population has surpassed 7.9 billion people as of the most recent United Nations data The population of the globe has significantly expanded since the second part of the 20th century, rising by an average of 80 million people annually and steadily approaching 8 billion people PepsiCo is probably expected to grow because population explosion causes quick increases in demand PepsiCo is probably going to expand because rapid population growth causes quick increases in demand Products that are both nourishing and practical are essential, particularly in today’s fast-paced life For PepsiCo, this is an opportunity.
In the process of complete globalization, many nations have adopted the policy of opening their economies, and as a result, the legal system is continually evolving For businesses in a dispersed industry, "franchising" is viewed as a very effective business model Companies who are interested in participating in this form must thoroughly research the country's franchise laws, including those pertaining to commercial law and licenses to transfer trademarks.
With more than 900 operational firms and bottling franchises worldwide, PepsiCo has the largest distribution network for its beverage goods The company expands its distribution network in order to boost productivity and better serve beverage merchants Additionally,the expansion of the distribution network gives companies a competitive edge in hastening the launch of new items To improve operational efficiency, PepsiCo has developed long-term relationships with suppliers, put into operation new production plants and warehouse techniques to save costs (approximately $25,000) In the world,PepsiCo is also divided into 6 regions to enhance and develop more opportunities in those regions.
SWOT Analysis
Market PowerIn 2021, Pepsi ranked the second top-selling beverage industry in the U.S.
Pepsi is doing business in both snacks and drinks
(Eg: increasing demand for its snacks stimulates the demand for beverage )Strong Global Presence corresponds with strong brand awareness
Youthful Logo attracts its targeted customers - youngsters
Effective Marketing Strategies( Marketing through Sports, utilizes celebrity endorsements)
Over Reliance on carbonated beverages and snacks is likely to limit business’ flexibility when these segments meet turmoil
Although the business has made a huge innovation in developing soda without fat, sugar, calories, this effort remains not enough since it can still lead to heart disease and diabetes
Racially-Insensitive goods ( Aunt Jemima brand, Uncle Ben’s )
Pesico need acquisition to further expand the business
Diversify its products beyond drinks and food Expand internet commerce.
Develop more healthy options to fulfill health concern of customers
Extend partnerships Boost social responsibilities
Demographic change (such as aging population in Japan) The taste of customers changes over time
Has been criticized as one of the top three polluters in the world and zero effort on decreasing plastic garbage
Main Issues
Bottled soft drinks (mostly plastic bottles) are drinks that have become familiar to the vast majority of Vietnamese consumers Compact, light, easy to carry and save production costs are the key points that make the production of plastic bottles become more and more favourable In addition, because of the difficult-to-break product nature, buyers have gradually formed the habit of using plastic bottled water products.
Nevertheless, this has led to the biggest issue "Many of them have made commitments that claim to make their products more sustainable, but most of them are just defending the flawed business model It's time to dispose of waste in a chaotic manner in the first place." says the report in Manila This problem is related to marketing strategy (4P) in theProduct section Moreover, consumers have started to look for greater variety in their drinks They have also become more health conscious This has led to a decrease in the consumption of soda or carbonated beverages In recent years, PepsiCo has been criticized for the high amount of sugar in its carbonated beverages, and has been blamed for contributing to childhood obesity PepsiCo's revenues could be adversely affected by a slowdown in the health-conscious carbonated beverages market.
Marketing Objective
Vision “To Be the Global Leader in Beverages and Convenient Foods by
Winning with PepsiCo Positive (pep+).”
In order to gain this, it is vital that PepsicCo challenge themselves continuously to become Faster, Stronger and Better.
Create more smiles with every sip and every bite for- customers’ satisfaction+Customers by offering cheerful moments through distinctive experience, appetizing taste
+Shareholders by increasing and maintaining high Total Shareholder Return
+Associates and our communities by creating chance to develop practical skills, and careers
+Planet by preserve limited energy sources and designing a more sustainable planet for following generations
Financial objectives for following year will be to increase profit, buid up a sustainable industry with less harmful garbage and improve products in order to match with consumers’ health concerns.
These objectives can be achieved by applying technological innovations (rPET), set price discrimination, as well as focusing on brand expansion and increasing company image through environmental aspects and improvements and placement in new target markets.
These future goals can be assessed obviously through yearly revenue of the following years recorded.
In overall, these aims are attainable thanks to the strengths and opportunities of PepsiCo.
These ojectives are relevant since it tend to contribute to the final goal – customers’ satisfaction
Thanks to its potential, Pepsico is likely to achieve these goals after 1 year.
Marketing Strategies
In advanced countries, the use of products/packaging from recycled plastic (rPET) has become a new consumption trend Develop Pepsi product 330ml plastic bottle with a new look through the application of technological innovations (plastic recycling) to packaging (rPET) Pepsi's packaging initiative made from recycled plastic (rPET) is going to be one of the popular trends in developed countries, making an important contribution to promoting green consumption and circular economy
Design packaging to be recyclable and make it easy for consumers to recycle and we need recyclers to innovate so that more is recycled
Building brand image with “green” campaigns in different social media platforms.
In Vietnam, we could book KOLs and Influencers to sponsor like famous Gen Z singer/rapper such as Tlinh, Low G… (in easily-viral platform as Tiktok)
Run campaign with key idea “ “Live green" is out of style?” and feature famousKOLs with remarkable past activity in environmental friendly concern like Giang Ơi (participated in Elle Sống Xanh), Châu Bùi (joined campaign “say No thanks to single use plastic),
Special pricing: Giving customers a lower price for a special period of time or to purchase in multiple quantities
Discount can apply to the company's distributors depending on the number of orders and the payment method
Expanding distribution system, especially expanding on e-commerce platforms to create customer convenience: vendor machines, intermediaries as fast food restaurant franchises