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Comparative Analysis between PepsiCo and Coca-Cola to Improve the Market Share and Distribution

Comparative Analysis between PepsiCo and Coca-Cola to Improve the Market Share and Distribution

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Published by: vikas1102 on Apr 03, 2012
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01/27/2013

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Chapter 1 Introduction
1.1 Soft Drink Industry in India:
A soft drink is a non-alcoholic beverage that typically contains carbonated water, a sweetener,and a flavoring agent. The sweetener may be sugar, high-fructose corn syrup, or a sugarsubstitute in the case of diet drinks. Soft drinks are available in glass bottles, aluminum cans andPET bottles for home consumption. Fountains also dispense them in disposable containers Non-alcoholic soft drink beverage market can be divided into fruit drinks and soft drinks. Soft drinkscan be further divided into carbonated and non-carbonated drinks. Cola, lemon and oranges arecarbonated drinks while mango drinks come under non carbonated category.The market can also be segmented on the basis of types of products into cola products and non-cola products. Cola products account for nearly 61-62% of the total soft drinks market. Thebrands that fall in this category are Pepsi, Coca- Cola, Thumps Up, diet coke, Diet Pepsi etc.Non-cola segment which constitutes 36% can be divided into 4 categories based on the types of flavors available, namely: Orange, Cloudy Lime, Clear Lime and Mango. In 2011, soft drinksregistered its highest off-trade value growth rate for the review period. This growth was helpedby high double-digit volume sales growth in most categories as well as appreciably higher unitprices in 2011. Sports and energy drinks, bottled water, ready to drink (RTD) tea andfruit/vegetable juice all maintained bullish growth even as abundant rainfall seemed to halt thespectacular recovery of carbonates witnessed in 2010.Table 1.1: Sales volume of non-alcoholic drinks in IndiaLiters mn 2009 2010 2011 2012 2013 Growth RateBottled water 3.290 3.885 4.515 5.169 5.825 14.5%Carbonated drinks 1.323 1.430 1.536 1.639 1.731 6.7%Juice 456 538 623 709 796 14.9%
 
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1.2 Company Profile:
PepsiCo, Inc. is one of the world's top consumer productcompanies with many of the world's most important andvaluable trademarks. Its Pepsi-Cola Company division is thesecond largest soft drink business in the world, with a 21percent share of the carbonated soft drink marketworldwide. Pepsi was founded in New York in 1965. Itshead quarter is in Purchase, New York. It is Producing Non-alcoholic beverage and Food processing items. Pepsi is a carbonated beverage that is producedand manufactured by PepsiCo. It is sold in retail stores, restaurants cinemas and from vendingmachines.It was first introduced as "Brad's Drink" in New Bern, North Carolina in 1898 by CalebBradham, who made it at his pharmacy where the drink was sold. It was later named Pepsi Cola,possibly.
Fig 1.1: PepsiCo‘s LogoPepsiCo gained entry to India in 1988 by creating a joint venture with
the Punjab government-owned Punjab Agro Industrial Corporation (PAIC) and Voltas IndiaLimited. This joint venture marketed and sold Lehar Pepsi until 1991, when the use of foreignbrands was allowed; PepsiCo bought out its partners and ended the joint venture in 1994 and in ashort period of 20 years has grown into the largest and one of the fastest growing food &beverage business in the country. The company has an extremely positive outlook for India."Outside North America two of our largest and fastest growing businesses are in India andChina, which include more than a
third of the world‘s population." (PepsiCo‘s annual report,
1999)
This reflects that India holds a central position in Pepsi‘s corporate strategy. India is a key
market for PepsiCo, and at the same time the company has added value to Indian agriculture andindustry. PepsiCo is concentrating in three focus areas
 – 
Soft drink concentrate, Snack foods andVegetable and Food processing.
 
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1.2.1 Brands:
Fig 1.2: PepsiCo‘s Brands
A.
 
Foods
PepsiCo‘s foods division Frito
-Lay is the leader in the branded salty snack market. All itsproducts are free of trans-
fat and MSG. It manufactures Lay‘s potato chips; Cheetos extruded
snacks, Uncle Chipps and traditional snacks under the Kurkure and Lehar brands. The
company‘s high
-fibre breakfast cereal, Quaker Oats and low-fat and roasted snack options likeAliva increase the number of healthy choices available to consumers.1.
 
Kurkure : tedhahai par merahai
 
Launched in 1999, developed entirely in India.
 
100 percent vegetarian.2.
 
LAY‘S – 
 
‗BE A LITTLE DILLOGICAL‘
 
 
Launched in 1995.
 
100 percent vegetarian.
 
Lehar Namkeen: KhushionKaKhazana
 
Launched in 1996
and re-launched in 2006.
 
Range of varied Namkeen using fresh and good quality oil

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