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Pepsi:Strategic Marketing

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Identify the Following for Pepsi:

1. Product/Brand - Identify and describe key features, sales, profit margin, market share, cost structure (primarily fixed or variable)
2. Corporate Background - Sales, Profits, Product lines, Brands
3. Market/Industry Analysis - Size and growth trend
4. Market Segmentation - How is the demand for your product segmented, i.e., what variables differentiate purchase motivations and behaviors?
5. Target Marketing
1. To which of these segment(s) is your brand targeted?
2. Characterize the typical buyer of your branded product.
3. Explain/justify this characterization.
6. Competition
1. Identify and comparatively evaluate your brand's top two/three competitors.
2. Perceived differences between/among brands
7. Relevant External Factors
1. Economic Conditions
2. Social and cultural trends
3. Technology
4. Resources - Availability/Non-marketing Cost
5. Political/Legal Environment

Defend your position on these issues and, where appropriate, comment on future financial implications.

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Solution Summary

The answer to this problem explains Strategic Marketing of Pepsi. The references related to the answer are also included.

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Product/Brand Analyzed (Pepsi)
Identify and describe key features, sales, profit margin, market share, cost structure (primarily fixed or variable)
Pepsi is a carbonated soft drink that is produced and manufactured by PepsiCo. It is a sweetened soft drink that has cola extract in it. In 2009 Pepsi had 9.9% of the US soft drink market. The product is that it is a carbonated beverage that is flavored and caffeinated. The product contains caramel color, caffeine and sweeteners like sugar or high fructose corn syrup. The cost structure is primary variable cost. The consumption of Pepsi and other colas is associated with a higher risk of chronic kidney disease.

Corporate Background - Sales, Profits, Product lines, Brands
The company PepsiCo has sales of $66.5 billion, and net profit of $6.4 billion. The product lines of PepsiCo are beverages, grain based snack foods and similar products. The brands include Pepsi, Frito-Lay, Tropicana, Quaker Oats, and Gatorade.

Market/Industry Analysis - Size and growth trend
The snack food market in the US alone is $30 billion with an annual growth rate of 2.6%. Global soft drink market is US $410 billion and the market and the US market size is 23% of the global market. The average growth trend is 2.7% growth in the US market. However, according to 2009 figures the volume of Pepsi declined by 8% in the US market. This decline in the sales of aerated soft drinks is believed to be responsible for PepsiCo diversifying into other products.

Market Segmentation - How is the demand for your product segmented, i.e., what variables differentiate purchase motivations and behaviors?
The first variable for Pepsi is the Geographical area targeted by the company and its bottlers. The segment that is most commonly targeted by Pepsis is Income, middle and ...

Solution provided by:
Hatim Baxamusa, MBA
Education
  • BSc , University of Calcutta
  • MBA, Eastern Institute for Integrated Learning in Management
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