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Nitin Lahoti 200

Table of Contents
Introduction.............................................................................................................2

Objective..................................................................................................................2

Executive Summary................................................................................................2

Industry Analysis....................................................................................................3

Company Analysis...................................................................................................3

Competitor Analysis................................................................................................4

Climate Key Trends (PEST)..................................................................................4

SWOT Analysis.......................................................................................................5

Market Segmentation:............................................................................................6

Marketing Mix.........................................................................................................8

Price........................................................................................................................10

Distribution:...........................................................................................................12

Promotion...............................................................................................................13

Plan for the Next 1 year........................................................................................14

ASHISH, MADAN, VISHAL, NITIN, G.V. KALYAN Page 1


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Conclusion..............................................................................................................15

Bibliography:.........................................................................................................16

Introduction
Marketing Plan is a basic concept which is required to make a product successful. It consists of
company’s strategy based on industry and targeted customers trends to make that product
successful. Marketing plan analysis is done because companies want to distinguish the relevancy
of their marketing plan in current scenario. This analysis comprises of industry analysis,
company analysis, product analysis, competitor analysis and products 4Ps. As part of our
academic work we have to analysis a product’s marketing plan and we choose Mountain Dew
because it’s in soft drink industry in which every youth is interested.

Objective
1. To understand the concept of marketing and marketing strategy and market planning.
2. To understand how key trend affects the product and industry and how consumer buying
behaviour affects the product.

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3. To understand the concept of market segmentation, market positioning and targeting by using a

The main objective of this report is to understand how and what the strategies are used by
PepsiCo to overcome the competitors.

Executive Summary
This report is the marketing plan analysis of Mountain Dew in India. It is a product of
PepsiCo which is a well known food and beverage company worldwide. This report emphasize
on how Mountain Dew establish itself in Indian market and also how it has make a good brand
image among its target customer. This report is also analysing mountain dew’s 4Ps which are
important to understand when we are analysing product. We also included the competitor’s
analysis of Mountain Dew and analyse them. For all this process we used credible and reliable
sources and based on these sources we recommended plan for next one year.

Industry Analysis
Non alcoholic market can be divided into soft drink and fruit juice. Some common soft
drinks are flavoured water, sweet tea, iced tea, squash, fruit punch and lemonade. Noncarbonated
and carbonated is further part of soft drink. Carbonated drinks are cola, oranges, lemon while
non carbonated drink mango drinks().

The total size of food industry in India is almost $ 65.6 billion and soft drinks (juices and
carbonated beverage) contain $ 1 billion. Indian soft drink market consumption in a year is 284

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million crates. Soft drink market is highly seasonal; consumption in during off-season is 15
million crates and in peak season is around 25 million crates per month. In urban area
consumption of soft drinks is 75% of whole market. Indian soft drink market is dominated by
MNC companies Coca-Cola and PepsiCo().

The consumption of Soft drink in India has a share of 46.8% within the non alcoholic
drink industry. In 2004 the total market value of soft drink was 307.2 $ billion and expected to
grow 367.1 $ billion in 2009()

Company Analysis

The business of PepsiCo is based on its vision of making tomorrow better than today().

In 1989 PepsiCo entered in Indian market and became one of the leading food and
beverage companies in India. PepsiCo India and its partners have invested almost 1 billion U.S.
dollar to growing their business. Including supplier and distributor it provides more than 1,
50,000 Job for people in India. In India it provide diverse range of brands that includes such-
Pepsi, Mirinda, Mountain Dew and 7UP, low calorie product such as Diet Pepsi, Aquafina
drinking water and fruit juice based drinks- Slice, Tropicana. There are some local brands Lehar
and Mangola. Frito-Lay is market leader in salty snacks market, which is free of trans-fat. It
manufactures traditional snacks under Lehar and Kurkure brands. For supporting operations in

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India it has 43 bottling plants, of which 15 are owned by company and remaining 28 are owned
by franchisee().

Competitor Analysis
PepsiCo has a good market share in India but facing tough competition from Coca-Cola
Company. Products of Coca Cola Company such as sprite, Coca Cola, Limca and ThumsUp are
the competitor of PepsiCo in soft drink market(). The most important drawback of its competitor
is their promotion and advertisement. Coca-Cola has less number of brand ambassadors as
compare to PepsiCo().

In India with the market share of 16.4% Thums Up is at number 1, sprite with 15.6% at
2nd position followed by Pepsi at 13% according to AC Nielsen data. In India Coca-Cola is
leader market share of 57.8% followed by Pepsi with 35.6%. In the portfolio of PepsiCo Pepsi is
the only one brand with market share of 13.1% but its rival coca cola has four brands that have
more than 10% market share in India. Those are ThumsUp 16.45, Sprite 12.2%, Limca 10.9%
and Fanta 10%.

SOURCE- AC Nielson

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Climate Key Trends (PEST)


Political factor: The government’s response initially was guarded in nature as well as
individuals health. The government has decided certain rule for beverage industry regarding to
production and also has decided level of ingredients like sugar, carcinogenic pesticide etc that
are used in soft drink. PepsiCo has to follow seriously these rules and set of criteria().

Economical factor: Soft drink is not expensive and it is used by most people. So soft
drink industry is not much tilted towards the economic influences.

But the raw materials they use in their soft drinks, juices and snacks like sugar, vegetables,
fruits and potato may slightly affect the production cost and the profit. The distribution channel
and transportation also affect the product cost slightly.

Another factor is the role of government like increase in tax.

Social factor: People today are very trendy, sensitive towards the advertisement. It means
people drinking Dew are fashionable and are very trendy. Taking this into account PepsiCo
targeted new generation people, and they are able to differentiate between them.

Some people are conscious about caffeine so they might have negative anticipation
about soft drinks. Also some people think that soft drinks companies spread pollution in
manufacturing process. For this Pepsi has a column in their website mentioning about their
social responsibility.

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Technological factor: Technology for manufacturing and packaging of a product,


transportation of raw material or delivery of a product is changing time to time, and thus it also
affects the production cost, transportation cost and unskilled labour. Technology also plays a big
role in packaging and designing of a product.

SWOT Analysis
In this part we are going to analyses the strength, weakness, threats and opportunity of the
PepsiCo.

STRENGTH

1. PepsiCo has good brand name, reputation and broader product line in international market.
2. With the revenue of more than 390 $ million PepsiCo is global leader in convenient snacks ()
3. International brand, innovative capabilities, strong distribution network.
4. Pepsi is market leader in making of snacks, sports drink and bottled water.
5. One of major strength of PepsiCo that it has developed into a large, strong organization because
of its good franchise system.
6. Strong advertising campaign and marketing policy for promoting brands.
7. Global presence, Sponsorship, Focus on most important customer trend -“satisfaction”.

WEAKNESS

1. Pepsi is far away from main competitor Coca-cola in international market.

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2. More than 50 percent of sales come from snacks (Frito-lay), it is a big threat if snacks market
comedown().

OPPORTUNITIES

1. Food is must for everyone so it can be expand internationally.


2. Offer and increase new healthy food and beverage because people are moving towards healthy
food.
3. The fastest growing part of industry is noncarbonated drinks.

THREATS

1. Strong competitor in the market like coca-cola, Cadbury Schweppes, Craft food and small bottle
firms.
2. People are moving towards healthy food().

Market Segmentation:
Group of individuals who possess similar needs and choices represent a segment of market().
Mountain dew has segmented itself mainly on the basis of demography and lifestyle in a niche
market of adventurer and extreme sports. In this niche market most of the consumers are youth
(). The key features of this market-

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Age: Mountain dew is targeting the consumer of age 12-28 means youth or teenagers. Cold
drinks are very popular among this age group and became a part of lifestyle. In the term of life
stage this age group falls in youth or teenage who lives with their parents and are depends on
their parents economically. To target this age group Mountain Dew is making its availability
easily to consumer in different volumes().

Lifestyles: They are targeting lifestyles of their consumer and it is reflected in their
advertisements. The chief and main consumers of mountain dew are the youth who are ready to
take on excitement, extreme sporting and adventure. They are daring, fun loving, confident and
energetic(). It is targeting the consumer’s tendency of fearlessness.

Income Level: It is not concentrating on income levels because their target consumer can
easily purchase the product as it is charging the standard price that is 6, 10, 15, 20 and 45 Rs. for
different volumes. It is also not important because all the other major soft drinks also have the
same price of their variants().

Targeting: Mountain Dew is targeting customers which are generally college students and
young executives. Generally customers of youth group are not concerned about price. This is a
niche market of adventurer, daring, and extreme sports lover and most of the people falls in this
category are young ().

Positioning:

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Positioning of brand or product is choice of a company to target the market where it can compete
and take advantage over competitor (). Positioning statement of Mountain Dew by PepsiCo is:

“To 16-18 year old males, who embrace excitement, adventure and fun, Mountain Dew is the
great tasting carbonated soft drink that exhilarates like no other because it is energizing, thirst
quenching, and has a one of a kind citrus flavour”()

Company’s positioning statement itself defining dew’s strategy that this drink will target and
made impact among the persons who are adventurer, funny, excited and daring. Also it is
positioning itself by promoting itself as a high energy and citrus flavour drink().

Segmentation Table:

Age 16-25
Life Stage Youth and Teenage
Who Students and Young Executive
Lifestyles Adventurer, Extreme Sports,
Daring
Positioning Energy and Exhilaration drink

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Marketing Mix

The term Marketing Mix was originally developed by Neil H. Borden to explain the right
combination, in a specific set of situations, of the four foremost factors that are the heart of a
product’s marketing plan().

Product: Mountain Dew is available in different sizes and volumes

• 200ml
• 250ml (can)
• 300ml
• 1.5 lt.

Ingredients: Regular glass bottle contains carbonated water, high fructose, corn syrup,
concentrated orange juice and other flavours, citric acid, sodium benzoate, caffeine. Sodium
citrate, gum arbic, erythorbic acid, calcium disodium EDTA, brominates vegetable oil and
yellow 5. For a regular glass bottle it provides calories (kcal) 110 and caffeine 35mg().

Product Level: There are five type of product level which a marketer need to concentrate on for
the success of product().

○ Core Benefit: The basic buying reason of that product by customer. The core benefit for
mountain dew is to quench their thirst.

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○ Basic Product: Basic product is the vital features of that product. Basic product for mountain
dew is carbonated water with some added flavours.
○ Expected Product: Expected product for mountain dew is a soft drink which gives more energy
and taste to consumer.
○ Augmented Product: It is the extra features provided by company to their customer. It is giving
more energy and taste to their customer by providing them more caffeine in their offering.
○ Potential Product: It is the all possible changes and transformation that a product can undergo
in future. Because it is targeting youth it can modified its regular bottle shape into some different
and innovative way so youth can attract. It can launch a new designed art form bottle().

Product Classifications

 Durability and Non Durability: It falls under the category of non durable goods because it is
has been used on regular basis by the consumer
 Consumer-Goods Classification: Under this classification it comes under the convenience
goods as it is very easily available and requires less search effort.

Product Differentiation

Form: It is differentiating itself in market by the size and shape of its 300ml bottle(). This
bottle’s neck is thin and long like beak and no other major soft drink is offering this type of
shape. This different shape attracts youth who is their target market.

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PepsiCo India Product


Beverages Juices Sports Drink Bottled Water Snacks
Pepsi Tropicana Gatorade Aquafina Lays
Miranda Cheetos
7up Uncle Chipps
Mountain Dew Lehar
Slice Kurkure
Dukes Lemonade

Image Differentiation: It has made a different image in customer mind by its effective
advertising. Their advertisements generally consist of extreme sports and Adventure by which it
is targeting youth().

Product Mix and Product Line Analysis

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 Product Mix: The width of product mix or the number of product line offered by Pepsi in India
is 5 and the length of product mix is 14. The depth of Beverage product line where due is
situated is 6. These all product lines of Pepsi are consistent and related to each other as they all
are drinks or snacks().
 Product Line Analysis: In product line analysis we can classify mountain dew in ‘specialties’
because lower sales with higher promotion.
 Product Depth: Mountain dew has no other variant available in market. It is available only in
one variant but in different volumes i.e. 200ml, 250ml can, 300ml and 1.5lt bottle so its product
depth is 4.

Product Life Cycle: Company changes its marketing plan and strategy as product’s life stage
changes so it is important to know that product is in which life cycle. Soft drinks industry is a
very old industry in India. It is now saturating and stepping towards maturation stage of product
life cycle. Soft drinks are easily available in urban area and it is now getting popular in rural
areas also so it is better it to put it in the stage where it is moving from growth to maturation.

Price
Market segmentation, positioning and competitor’s pricing strategy plays a major role in
defining a product’s pricing strategy.

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In shaping price of a product a company should analyze the consumer’s buying


behaviour to purchase that product on the basis of price(). So company has to think 3 important
aspects-

• Reference prices: It means what the other brands are charging for the same. It is available at the
same price as the others products of the same category are available in market (our market
research).

• Price-Quality inferences: Many consumers take price as a quality indicator. Dew is a product
of PepsiCo which has an image of good quality at low price in consumer’s mind.

• Price cues: Perception of consumers plays an important role in price setting. In the beverage
industry consumers have a perception to give money in round figure so most of the prices in this
industry end with the digit of 5 or 0.

Setting the Price:

A company has to take some steps before defining the price-

1) Selecting the Pricing Objectives: The pricing objective for mountain dew is survival because
intense competition in sector as well as to increase market share they are using market
penetration pricing strategy().

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2) Determining the Demand: The customer which mountain dew are targeting are less price
sensitive and also it is a low price product so price do not effect so much to demand. It is in a
segment where price is inelastic and change in price doesn’t lead to a big change in demand().
3) Estimating Costs: Before establishing the cost companies have to count its own expenses.
Mountain dew has several costs in his production and distribution process like intergradient,
bottle, packaging, promotion and advertising, carriage etc.
4) Analysis of competitor’s price: A company should also take a look over its competitor’s price
because it also helps to determine price. Mountain dew has the same price as its rivals.
5) Selecting the pricing methods: PepsiCo has selected value pricing method for its cola products
because it wants customer loyalty with low price and high quality().
6) Selecting final price: After passing through all this process company decide the prices of
product which will reach to customer. (We have already mentioned the prices of different
variants of mountain dew) sometimes on different occasions company announces discounts or
allowances but mountain dew has no such type of strategy.

Distribution:
After company manufacture the product, it has to decide that from how many and which
type of channels through product will reach to customer.

Mountain dew is PepsiCo’s product and PepsiCo has a huge supply channel network for
its entire product. Through these channels it distributes mountain dew. So instead of analyzing

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supply channels of mountain dew we are analyzing Pepsi’s supply chain management and
distribution systems().

Mountain dew is available through intensive distribution because it is easily available at


everywhere. It has implemented this intensive distribution to supply saturation exposure of the
market by using all accessible channels. That’s why Mountain Dew is available in all parts of
rural and urban area at all the miniature and large retails stores, supermarkets, departmental
stores.

There can be zero to 5 levels of intermediaries implicated in the intact supply chain
before product reaches to the end consumer. This is because India is a big country and PepsiCo
don’t actually have an extensive network of sales agents, brokers and additional force which is
very important and is perfect for make product approachable to the markets. This work is done
by distributors, wholesalers and retailers. The margins reserved by these mediators sort from 2%
to 5%. PepsiCo transported its products from 43 manufacturing units which are in separate parts
of India via different C&F agents or warehouses to distributors who further sell it to the stockiest
who lastly sell it to the retailers. Because beverage industry is highly unstable and vibrant so
products should be available in market at all the time. The supply of product primarily depends
upon the quantity required by retailers and it can be supplied on the regular basis or after some
intervals.
PepsiCo also have a bundled service with Pizza Hut where Pepsi products including
mountain dew is available with pizza at special price. It is a zero level channel system. It has tie

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up with HUL to distribute in rural area because HUL has a very large network in rural areas of
India. PepsiCo has provided jobs to 150000 people in India including its distributors.

PepsiCo India Product


Beverages Juices Sports Drink Bottled Water Snacks
Pepsi Tropicana Gatorade Aquafina Lays
Miranda Cheetos
7up Uncle Chipps
Mountain Dew Lehar
Slice Kurkure
Dukes Lemonade

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Promotion
Advertising: For advertising different kind of media is being used by mountain dew which
is as follows:
Television
Radio
Internet
Newspaper
Others
The main product of PepsiCo is Pepsi but they are spending 75% of its advertising budget
on mountain dew advertising.

Ads of mountain dew


1. One of the most appealing ad of mountain dew is with tag line “cheetah bhi peetah hai”
where it is targeting there target customer by showing a fighting with a leopard for Dew. This ad
is suitable which its image of daredevil and fearlessness.
2. Second ad includes one man fighting with long horny animal for the dew can. It also
shows hardiness nature and also tells how powerful the drink is with the tag line Do the Dew.
Sales Promotion

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Mountain dew is not using many type of sales promotion because it is in a niche market
and customers are loyal. It is using some contests on its website to create awareness about
product and the price for right answers is free adventure tour which is also suitable to its
positioning.

Public relations and publicity

It is not using this tool of promotion very much but in recent in the movie mission Istanbul it
was one of the partners and got publicity by this.

Events and Experiences

Events are the important part of its promotion as it is targeting youth. It is organizing many bike
racing, mountain riding events where youth participates. It has also organized road shows with
Jagran Solutions for consumer awareness in 185 cities of 7 states.

Word of mouth

This is the important way of promotion where satisfied customers encourage other people who
come in his contract. Mountain dew is enjoying this tool of promotion because it is youth
targeted drink and satisfied youth themselves promote it as a good drink among his friends.

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Plan for the Next 1 year


After doing the whole analysis for mountain dew’s marketing strategies we are now able to give
our opinion that what should company do for better results.

Product

As we have already described that what is the mountain dew’s product strategy at the time so
now we will only emphasize on the key points they can change in their product.

 There is only one flavour of mountain dew available in Indian market. We will make this
existing mountain dew more specifically targeted at these youngsters by including additional
features like stylish shape of bottle and design etc.
 We will launch more variant of mountain dew like caffeine free mountain dew for the consumers
who are more health conscious, flavoured mountain dew which can be lemon, orange etc. We
will also like to launch an energy drink variant of Dew which made of coconut water.
 Mountain dew’s differentiation strategy is good at the time and it has made an image in
customer’s mind. We will also like to differentiate it on the basis of social awareness issues like
pollution, poverty, population, corruption etc. with this strategy we segment market on the basis
of psychographic.

Price:

Mountain dew is available at different price range in India. All prices at which it is
available are reasonable and less marginable because of intense competition in market. All the soft drinks

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in Indian market are available at same price range so it can’t hike its price also it can’t cut down prices
because already there are less margins. But there are very less discount offer are provided by mountain
dew so it can give some discounts on a bundle purchasing like 5rs. Off on the purchase of two 2liter
Bottles.

Promotion

There is no brand ambassador for it so we will like to select a brand ambassador to


endorse and promote mountain dew. We will like to select Narayanan Karthikeyan as the brand
ambassador for it because he is from F1 racing and suitable for the brand image of mountain
dew.

We will to promote it mostly near colleges and BPO centres because most of the
people there are young. In beverage industry personal selling is not applicable. Instead of this we
like to sponsor more adventurer program and associate with them. We can also advertise on the
social and public issues like pollution and corruption because today’s youth is so sensitive about
these issues and he will associate themselves very soon with these advertisements.

Place

Indian soft drink industry is estimated to grow at 8% per year so it is important to


secure good supply throughout country. For this we will apply Pepsi Bottling Group (PBG) in
India because it has successfully managed PepsiCo’s distribution in USA. Also we will make

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some strategic partnership as already with pizza hut. India has a lowest per capita consumption
of cola so there are a lot of possibilities to do in rural area.

Strategy on the basis of competitor -

Coca cola’s market share is greater than PEPSICO. As we can see that the market share of
mountain dew is 6.8% is less than his main competitor sprite 15.6% and ThumsUp is 16.4(AC
Nielson). In terms of taste and same kind of product sprite is main competitor of mountain dew,
but sprites main target is collegians as it is indicated by Sprite ad “Seedhi Baat” USP by coming
out with the Ghumo Ghumao Sprite Express TV ads”. ThumsUp is also eating the market share
of Mountain Dew as its ad is also targeting the adventures and young promoted by Akshay
Kumar. So seeing the both competitor we will spend more money on advertisement to make it
more attract and adventures.

For designing a communication strategy we will use creative strategy. In which we will use
transformational appeals as a communication. To defeat both competitors we would like to
organize some adventures events and road show.

Conclusion
After analyzing and describing the whole marketing strategy of mountain dew we can
conclude that mountain dew is doing well in market. We want to conclude that practices makes

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improved but not ideal so we hope that this report will help PepsiCo to improve results. With the
best marketing plan a product can’t be successful because outside forces will affect it but with
the marketing plan process you can achieve success because then you are also adopting
conditions.

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