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PepsiCo Inc. began marketing the soft drink beverage Pepsi that first developed in the 1880s as its signature product at the time. Over the years PepsiCo has evolved from a beverage corporation to a multiple product corporation including marketing a broader range of food brands besides its beverage brands. PepsiCo has pulled aside many veils ahead of its competition and became of the most inspiring corporations and food and beverage suppliers worldwide. Its presence spotted on visual and audio advertisements prove that PepsiCo understands the correct timing to pursue its target audience. Besides excelling in its marketing strategy, it develops touching themes en route to its targets to gain its customer base. Surely as all corporations do experience, PepsiCo faces challenges and constantly discovers effective methods to overcome challenges and revisit its marketing analysis. One positive aspect of competition is it unleashes the potential of new products and ventures upon which PepsiCo may undertake. Otherwise if PepsiCo were the sole corporation, its consumers would easily develop boredom and strive searching for other sources including unknown brands.
This report explains how PepsiCo utilizes its product branding and promotional strategies to entice its customer base, while simultaneously maintains fair treatment and market sharing with its competition. Furthermore, PepsiCo is illustrated throughout its promotion on its environmental and product nutrition to gain respect and credibility from various age groups. For clarity of this somewhat brief report, PepsiCo is generally shortened to Pepsi and mainly branded for its signature beverage to assist readers understand how and where PepsiCo was established.
Keywords: PepsiCo, branding strategy, marketing analysis, supply chain strategy, promotional strategy
Pepsi-Cola manages to distinguish its brand positioning by rendering its beverage product with a sweet and sugary taste targeted for younger consumers. Incorporating this taste trait is what created Pepsi’s differentiation to meet the wants and needs of consumers and standing out from its competitors including Coca-Cola. Besides its external branding towards its target audience, Pepsi allows its branding management to propose experiments to its consumers new to Pepsi’s brand beverages. By providing consumers the opportunity to state their opinions of tasting experiments, consumers are drawn to Pepsi’s products as they feel in control of having Pepsi provide them with their wants and needs. On the other hand, Pepsi also implements its branding management protocols to allow Pepsi to retain its brand control and assure no external factors will force it to alter its brand, especially since its brands already captures consumer attention.
2.0 Pricing Strategies
Instead of arbitrarily setting prices due to its brand name, Pepsi sets its prices based upon consumer value perception. As aforementioned, Pepsi experimented with consumer perception and determined its beverages are for refreshment instead of mere thirst quenching since cold beverages were market driven. Whatever carrier of Pepsi suppliers will be, Pepsi proposes a dual pricing competitive strategy to adjust to its carrier prices. For example, a supply chain store such as Wal-Mart partnered by carrying Pepsi beverage products promotes lower prices. This gives Pepsi the opportunity to simultaneously lower its prices by reducing its operating costs. An additional pricing strategy implemented is narrowing the price range during specific times of the year (Reuters, 2013). The purpose is to draw consumers into buying enough products for a specific period of time when prices are discounted. Then consumers will resume buying once prices are discounted once again and when they need the products.
3.0 Supply Chain Strategies
Pepsi optimizes its storage and warehousing by overhauling its orders to its end consumers. It implements its supply chain strategy by formulating a direct delivery method to its retailers by vast volume delivery daily. The purpose is to avoid overstocking of product and Pepsi formed the Pepsi Beverage Company to resolve this issue by utilizing the process known as the Warehouse Infrastructure Initiative to initiate the direct-to-store delivery method. The process assists in reducing warehouse space and storage costs with direct delivery to allow for stock keeping unit growth (Stroud, 2015). Pepsi’s retailers are additionally and beneficially provided with faster delivery service to avoid longer waiting periods and shortage of stock when they require supply to the end consumers.
4.0 Integrated Marketing Communications
With improvements coupled with evolution of technology, Pepsi stays connected to its consumers by deeply rooting itself into the social system. One of its most prominent and economical marketing communications is the digital world. Pepsi’s social media adapts to social change to stay upon its target audience and reinforces its innovative strategy to effectively market its brand and beverages. Pepsi managed to partner with social media giants including SXSW, a company that promotes music, film, and the latest technology trends providing Pepsi with an advertisement platform to expose its brand to its consumers. Through these customized channels Pepsi adds its value with advertisement Instagram pictures of other popular brands.
5.0 Promotional Strategy
5.1 Company Presence in Domestic and International Markets
With its brand embedded in many countries around the world, Pepsi targets mostly teens and young adults. With teens and young adults heavily into the latest technology trends, Pepsi constantly changes its promotional strategy and image on a domestic and international level to correspond its target audience. Its advertising strategy is usually creative with colorful and alternative promotions that incorporate various elements such as music and sports transmitting virtually throughout the world. With the ever-growing social media, Pepsi encourages feedback with options to music mixing, downloads and gaming applications.
5.2 Company Vision and Execution of Direction Strategy
Pepsi’s vision integrates its performance of sustainability into its business strategy by paving a positive foundation and impact on society and social environment. Its vision has meaning in which it creates its products its consumers strive for rendering its personnel proud to sell these products. Pepsi innovates its products by the needs of its communities and sharing with them its personnel talent ensuring its creative guiding principles.
5.3 Company Plans for Growing and Servicing Its Customer Base
Pepsi may plan to entice the older generation to consume its products, although Pepsi has traditionally a beverage targeting younger people. By analyzing population growth, generation gaps will occur and the shift in preference for Pepsi’s products will also shift. To reduce preferable shifts in the market, Pepsi will implement new products or modifications to its current products to satisfy a larger customer base of various age groups. While most beverage corporations continue to market sugary foods and beverages and are seeking to explore a more nutritious path, Pepsi plans heighten nutrition by capitalizing on healthier options to reinforce its customer base (Clark, 2013). With several growing environmental concerns, Pepsi is critically planning to find processing methods in phasing out plastic bottles and cans that are harmful, and shall produce more recyclable bottles.
Reuters. (May 22, 2013). PepsiCo Rejiggers Pricing Strategy to Lure Customers. Chicago Tribune.
Stroud, A. (May 21, 2015). Why PepsiCo Supply Chain Innovation Matters Organization Wide. APQC Blog.
Clark, A. (Feb 20, 2013). The PepsiCo Challenge: Growth Through Nutrition? GreenBiz.