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The Countries of the G7

The G7, or "Group of seven," consists of eight large world economic powers. The G7, as the group is sometimes known, lacks Russia Canada France Germany Italy Japan Russia United Kingdom

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THE INDIAN SOFT-DRINK INDUSTRY SCENARIO

Domestic firms in India, which once enjoyed the benefits of sheltered markets, are increasingly facing competition from global giants in 1990s. Sheltered market had once allowed Indian entrepreneurs to develop strong brands that have held there own against the onslaught of the multinational companies. Some domestic firms have chosen the strategy of tie-ups with MNC‘s. Others have tried to meet the competition head on. Whatever route Indian firms take to deal with competition from MNC‘s it is imperative for them to keep track of global strategies of these firms. Often the strategies undertaken at the local level are only part of the global strategies, because it is difficult for any firm to allow significant differences in approach in different markets.

Coca-Cola controlled the Indian market until 1977, when the Janta Party beat the Congress party of then Prime Minister Indira Gandhi. To punish Coca Cola‘s principal bottler, a Congress party stalwart and long time Gandhi supporter, the Janta government demanded that Coca Cola transferred its syrup formula to an Indian subsidiary. Coca Cola backed and withdrew from the country.

India now left without both Coca Cola and Pepsi became a protected market. After Coca Cola made its exit from Indian market in1977, there was a vacuum in the soft drink market, advantage was taken by Parle and Pure drinks. Parley launched ―Thumps Up‖ and gained a substantial and robust market share. In 1977 with a change in the government at the centre led to the exit of coke, which preferred to quit rather than dilute its equity to 40% in compliance with the provisions of FERA, the first national cola drink to emerge was Double Seven. In the mean time, Pure Dinks, Delhi, on Coke‘s exit switched over to Campa Cola, and, by the end of 1970s, Campa Cola was practically alone in the Cola market. 1

Parle introduced Thumps Up in the beginning of 1980s, followed by thrill by McDowell‘s and Double Cola by Double Cola manufacturing Company (DCMC)-an NRIrun outfit with its plant at Nasik. An additional dimension to the Indian soft drink industry was that of fruit drinks, which were valued at Rs. 40 Crores and among the brands in the market, the leader was Parle‘s Fruity with about 40% of the market share. The other players in this segment who have posed challenges to Parle are Godreg(with Jumpin) and Ahemdabad bases Pioma Industries‘ Rasna Cola-Cola.

Setup in 1949, by 1978, Parle led the Indian soft drinks market with a share of 33%. Gold Spot and Limca were the clear winners, and later, Thumps Up also started contributing to its growth. Thus, Parley touched a market share of around 60% in 1990. However, with the arrival of Pepsi, Parle‘s share decreased to 53% and Pepsi quickly attained a market share of about 20 percent. Till 1990, Parle‘s chief rival was Pure Drinks, which was steadily losing out to Parley. After the arrival of Pepsi, the market share of Pure Drinks further deteriorated. This was mostly because Pure Drinks had smaller number of bottling plants and a limited distribution network – exactly the same reason why Pepsi could not do much against Parle. Parle had 60 bottlers against Pepsi‘s 20 and 2.1 lakh retailers against Pepsi‘s 1.5 Lakh. Before 1992 , the Indian soft drink industry had not grown fast mostly due to high excise duties and government encouragement of fruit drinks over carbonated drinks. The Limca was largest selling brand of bottled soft drinks in India, from consumers point of view ‗Cola‘ was the most popular flavor. It accounted for about 40 percent of the market. ‗Lime‘ and ‗Lemon‘ drinks followed with about 30 percent, and ‗Orange‘ drinks had only about 20 percent of the market share. Carbonated soft drinks accounted for the rest 10 percent. From 1984 to 1992, the Rs, 1,200 Crore Indian soft drink industry grew at an average of 2.5 to 3 percent, the highest being 12.4 percent during 19841985. 2

Pepsi had begun its efforts in mid 1980s but only in 1990 it was able to make an entry in the Indian Cola market. In early 1985, the then government rejected a proposal with RPG GROUP. This involved the export of fruit juice concentrate from Punjab in return for the import of Cola concentrate. The deal offered was a 3:1 EXIM ratio.

The revised proposal made by Pepsi also met lots of resistance. The strongest opposition to the proposal came from the food and civil supplies ministry, which argued that India should be promoting fruit juices, not carbonated soft drinks. Opposition also came from CSIR, one of whose laboratories developed its own soft drink flavors. After more than 5 years of acrimonious battles Pepsi was finally launched in India in June 1990. To obtain the license for India, Pepsi had to export $5 of locally made products for every $1 of materials imported, and it had to agree to help the Indian government to initiate a second agricultural revolution. Pepsi has also had to take on Indian partners. Pepsi Co, Punjab Agro Industries Co-Operation (PAIC) and Voltas promoted the project.

Pepsi had a very significant first mover advantage in the Indian market. It did not have the condition of divestment of 49 per cent equity in downstream ventures attached to it when it received permission to invest in India. Pepsi had obtained the government approval for its downstream ventures prior to the FD1 guidelines that made Indian equity holding mandatory. Thus, in its original clearance, Pepsi was not only allowed to hold 100 per cent equity .in its holding company but was also allowed to carry out bottling and marketing operations.

The government approval, moreover, had allowed Pepsi to earn* out acquisition of assets to expand its business in the country. Pepsi used this clause in 3

1993. In March 1991.) There was now a triangular battle between Parle. Soon after. to prove that bigger is better in cola wars and was again first to introduce 'takeaway' 250 ml bottles for the first time in the Indian cola market. Coca Cola came back to India after 16 years when it was launched on October 24. Pepsi and Pure Drinks. Thums Up ran ads downgrading Pepsi's taste and declared that it was a fast drink. Thums Up launched Double Maha Cola. Great Eastern Shipping and the Britannia Industries Ltd.its approval to buy out 100 per cent stake in some of the domestic bottling companies including its high profile buyout of Gujarat Bottling Company. the 500 ml bottle. the former Coke franchisee in Ahmedabad. Pepsi got into more trouble when six months after its launch it caught government's attention regarding its commitments. 1993. Coca-Cola was initially wooed by the Godrej group. (Industry ministry sources have clarified that while Pepsi would be required to seek fresh government approval if it picks up shares in domestic bottling companies as part of its portfolio investment. As a response. at Agra. Pepsi launched 250 ml bottles in June 1990 to capture the 250 ml bottle-market of Thums Up (launched in November 1989). it signed an MOU (Memorandum of Understanding) with BIL and this proposal was accepted by the Chandrasekhar government. But relationship between the two companies turned sour over the export-oriented clause and finally on June 23. Thums Up entered the brand war totally with blind taste test ads. 4 . it does not need such approval if the assets are acquired for expansion. led by Rajan Pillai. a show cause notice was issued to the company for prima facie violation of the conditions stipulated in the letter of intent with regard to the production of soft drink concentrate.

The potential in the Indian market is tremendous. the market has witnessed a high-profile tussle between the global giants . with estimated sales of 140 million cases (one case :. The companies have continued to wage their war in India. This tussle and the respective problems faced by the two firms in the Indian market are extremely instinctive.200 crore. prior to 1990. However. was witnessing sluggish growth rates (CAGR: around 5 per cent) with two domestic players: Parle and Pure Drinks. The industry. After the second coming. seemed to have made an entry under ideal conditions in the market. after a couple of abortive attempts. The Indian market is roughly more than Rs 1. it then faced dissensions within the ranks of its bottlers. Coke. Coke and Pepsi.Coca-Cola and PepsiCo. In 1995 the market grew by 20 per cent in volume term. led to a rapid expansion in the size of the market 5 . Hut Pepsi is sparing no efforts to gain a larger share of the market. of the international varieties of Cola drinks. the company bought out the Parle brands. On September 22. The entry of the cola giants. Both Coke and Pepsi have rightly realized that the immediate priority is in expanding the market by increasing the growth rates.24 bottles of 300 ml each) up from 115 million cases in 1994.5 per cent between the years 1984-92. Its manner of dealing with the bottlers seemed to lack Pepsi's finesse and India seemed to be one of the rare markets where Pepsi was holding its own against Coke and consolidating its position.Coca Cola got the permission to enter the country with a 100 per cent unit in India. gained a huge market share overnight. 1993. moreover. From 1992. when the Cola war took a serious turn. the growth rate has almost doubled. Coke. the per capita consumption of three bottles in India is lagging way behind the US's astounding 700 bottles per capita consumption. with the strategic move of buying out Parle. The Indian market averaged a growth rate of 2. PepsiCo gained a significant first-mover advantage through its ability to gain early access to the market.

today it accounts for well over a half. Also not only the market size is increasing. Coke's acquisition of Parle has turned the market into a duopoly. Whereas in 1990. COMPANY PROFILE 6 .(CAGR for the first half of the 1990s: around 20 per cent). there is also a shift of consumer preference between the different soft drink segments. cola was accounting for a third of all soft drinks sold.

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Gold Spot is considered as the first branded soft drink in India.COMPANY PROFILE In 1902 the Pepsi Cola Company was launched in the back room of pharmacy and was applied in patent office for a trademark. 9 . As per FERA regulations the company was required to indicate or clear operation. Parle exports private Ltd. 1903 ―Pepsi Cola‖ was officially registered with the US patent office. and 40 by 1907. The business begins to grow on June 16. they had attentively introduced ‗Cola Pepino‘ which was soon with from the market. to 15 the following year. The Coca-Cola Company entered India in the early fifties.968 gallons of syrup using them in ―exhilarating aids digestion‖. pure drinks introduced ―Campa Cola‖ along with orange and lemon. Coca-Cola was the first foreign soft drink to be introduced in Indian markets. It also awarded for franchised to bottle Pepsi to independent investors. where number grew from just two in 1905 in cities of charlotte and Durham. In July 1977 Coca Cola left India following a public dispute over share holding structure and import permits. Calcutta. Before Limca introduction. Modern Bakeries introduced ―Double Seven‖ Thrill ―Rush‖ and ―Aprint‖. At the same time various regional soft brands played an independent role in their respective territories like ―Duke‖ and ―Mangola‖ etc. the major domestic player later in 1970 introduced Limca. It was introduced by Parle in early forties. which was filled by several companies who came forward pushing different brands in market. Coca-Cola left a big gap. Coca-Cola enjoyed a good beginning and dominated the market. a lemon soft drink. That year Cola sold 7. Parle products introduced their cola ―Thums Up‖. Delhi and Kanpur. when four bottling plants were setup at Bombay.

Uncle Chips. Its diverse portfolio of brands include the flagship cola brand . Cola was produced in India.Pepsi. and Quaker Oats. PepsiCo stays committed to providing its consumers with top quality beverages. PepsiCo is also a dominant player in the snack food segment in India.After Coke was asked to leave India Pepsi began to lay plans to enter this huge market. Aquafina packaged drinking water. 7Up. Pepsi further offered to transfer food processing packaging and water treatment to India in the way Pepsi started its operations in April 1989 for beverages. PepsiCo's snack food company Frito-Lay is the leader in the branded potato chip market. Cheetos extruded snacks. Pepsi also promised to focus considerable selling efforts on rural areas to help their economic development. Tropicana brand 100% fruit juices in various flavors. The group has built an expansive beverage. would find hard to refuse. snack food and export business. In 1990 first Pepsi. Mirinda. PepsiCo entered India in 1989 and in the span of a little more than a decade. Dukes Lemonade and Mangola. of which 17 are company owned and 22 are franchisee owned. has grown to become the country's largest selling soft drinks company. It manufactures Lay's Potato Chips. 10 . Slice fruit drink. Diet Pepsi. Mountain Dew. approval for its entry over the objections of both domestic soft drink companies and anti-multinational legislators. Gatorade plus local brands Lehar Evervess Soda. The Company has invested heavily in India making it one of the largest multinational investors. Pepsi offered to help India export some of its agricultural products in a volume that would cover more than the cost of importing soft drink concentrate. snack food and exports business and to support the operations are the group's 39 bottling plants in India. Pepsi saw the solution to lie in making an offer that Indian Govt. Pepsi worked with an Indian business group in seeking govt. traditional namkeen snacks under the Kurkure and Lehar brands.

administering medical camps in villages. It gives PepsiCo India great pleasure in associating with Defense India and Samvedna for an event to bring cheers and smiles for our Jawaans of BSF (Border Security Force) at Wagah. The production of Slice. Under this project Pepsi in association with Castrol helped soldiers set booths in rural area to sell Pepsi and Castrol products there by helping them to not only earn a decent living but to also add some color to their lives. As part of its sustainable development initiatives. PepsiCo India has worked closely with the Defense forces in rehabilitation of Defense Personnel through projects like Mission Vijay-2. In the next year. Teem and Fountain Pepsi started in 1993 Coca-Cola came back again in October 11 . PepsiCo has made significant investments with the Punjab Agriculture University to develop a comprehensive agro-technology Programmed that has helped thousands of farmers across India improve the yield of their farms and the quality of their agricultural products. PepsiCo India has been a committed leader in the promotion of rain water harvesting. PepsiCo has leveraged its knowledge in contract farming to develop seaweed cultivation in Tamil Nadu and has partnered with the Government of Punjab to help farmers of the state through the utilization of developed technology for citrus farming. water conservation recycling and the reduction of effluent discharge. Through this project PepsiCo India also tries to give these soldiers distribution rights for its soft drinks. 1991 production on Mirinda and 7 Up started. PepsiCo stays dedicated in its endeavor to develop community outreach programs by supporting rural water supply schemes.agri business. PepsiCo has also established zero waste centers and PET recycling supply chains and assisted victims of natural disasters. commodities and Pepsi system sales. providing computers to rural schools and creating opportunities for women in rural areas through vocational training as an alternate means of livelihood.PepsiCo is one of the largest MNC exporters in India and its export business consist of three categories .

presenting the presentation of food Adulteration (Fourth Amendment) rules 1999.1993 and launched in Agra. Coca-Cola also rolled out its popular clear lemon drink sprit in India at same year. to enter India and gradually took over the same company. 12 . a notification. 1999. Ltd. as part time and a successful fame potassium in the formulation of soft drinks. allowed the use of the blended artificial sweeteners. It joined hands with Parle Export Pvt. The nineties also saw a new foreign entrant called Cadbury Schmeppes. which rolled out Canada Dry and Crush in Metropolitan cities. which in what made the entry of diet Pepsi and diet coke. Pepsi entered the cloudy lemon category by launching its Mirinda Lemon in 1998. In may 1999.

Phosphoric acid. Calories Total Fat (gm) Sodium (mg) Potassium (mg) Total Carbohydrates (gm) Sugars (gm) Protein (gm) Caffeine (mg) 100 0 25 10 27 27 0 25 13 . High fructose Glucose syrup/or Sugar color.What’s in Pepsi? Pepsi contains: Carbonated water. Caffeine. Citric acid and natural flavors.

Service executives. and their state units are divided into territories. Allahabad territory falls in U. Marketing Executive. Gorakhpur. Each territory is headed by territory Development Manager (TDM) who is assisted by one or two Accounts Development Coordinators (ADC) . Lucknow. Rohan Arora is Territory Development Manager (TDM) and Mr. Devendra Singh.The territory developments Manager (TDM) have a team of executives. Raghvendra and Accounts executive is Mr.M. Subodh Kumar. unit comprises of Share bottling plants at Sathariya (Jaunpur). business unit). East & North units are headed by Mr. Saurabh Gupta (Unit Manager).P. Bareilly in U. unit of East and North Marketing unit. Each marketing unit is subdivided into state units.Harsh Rai. These executives are Customer executives. heads the Indian Unit. Mr. West and South. MEM Coordinator. This unit is headed by Mr. to carry out the sales and marketing operation in India. Executive working on Projects Mr. Legal Advisor. The Customer executive in this territory is Mr. Neelkamal. There are three marketing units in India East and North. Company owned bottling operation (cobo) of U. Marketing Manager. 14 . Ajay Nagar is Accounts Development Coordinator (ADC) of Allahabad Territory.P. Jainpur (Kanpur) and Bajpur (Nainital) which supply to six territories at Allahabad. The Customer Service Executives of this territory is Mr. The other staff in his office is finance controller. Mr.COMPANY STRUCTURE PepsiCo India Holding Ltd.P. and Uttranchal. Accounts Executive and personal Executives. is created by Pepsi Company. Prakash Aiyer. Rajiv Bakshi. finance coordinator. he is assisted by Mr. (G. and Accounts executives. Kanpur.

ORGANISATION CHART Business Unit Manager (India) MUM (West) Marketing Unit Manager (East & North) MUM (South) Unit Manager TDM (Kanpur) TDM Territory Development Manager TDM (Lucknow) (Allahabad) TDM TDM (Gorakhpur) (Barreilly) (Uttranchal) Territory Traini Coordinator Account Development CE (Mirzapur) CE CE CE CE CE CE (Jaunpur) (Ghazipur) (Pratapgarh)(Bhadoi)(Kausambi)(Sonebhadra) CE Customer Executive (Varanasi) (Allahaabd) 15 .Allahabad territory is a big territory covering eastern districts of U. Jaunpur etc. The annual turnover of company in this territory was 3 million crore in 2004. Ghazipur. Kausambi. Bhadoi. Mirzapur. as Allahabad. There are 72 distributors in this territory.The turnover of the company in India was 115 million crore in the same year. Varanasi. Sonebhadra.P. Pratapgarh.

Henri Laurens.  Hiring people who love change and thrive on risk taking. Alberto Giacometti.Y.EPSICO HEAD QUARTERS Pepsi co India world head Quarters is located in Purchase.Kendall Sculpture collection in a garden setting. designed the seven-building headquarters complex that includes the Donald M. 16 . Alexander Calder. approximately 45 minutes from New York City.  Execution of a plan often derive success more then more marketing  Encourage Executives to think laterally. .  Conjure Up those creative tactics to knack fizz out of its competition. Edward Darrel Stone. Arnaldo Pamodoro & Claes Oldenburg. COMPANY’S GLOBAL STRATEGY  Set a winner growth goals if you act like number two. N. you will always be number two.  Always anticipate the response you may provoke. One of Americas foremost architects. Henry Moore.  Upset the rules of the market place. The collection of works is focused on twentieth century & features work by masters such as Auguste Rodin.

But with increasing occasion led & home refrigeration led consumption the sales of bigger SKU‘s like more than 1 liter pack size has increased this has led to increase contribution from pet bottles sales up to 75% are in Urban areas. In terms of SKUS the market is Skewed towards 300ml which constitutes around 80-85% of the market rest in the form of other pack. The Thums up brand is targeted at people in age group & is positioned as fun drink. which was witnessing 5-6% growth in the early 1905 & even slower growth at around 2-3% in the late 80s. Soft Drink market size for Fy00 was around 270mm cases (6480ml bottle). Presently the market growth has slowed down with growth rate of 7-8 per annum dawn with growth rate of 7-8% per annum compared to 22% growth rate in the previous year.PEPSICO MISSION We dedicate our efforts to In India.  Building long-term prosperity of our brands in the market place.  Hiring & training ‗People‘ who single handedly drive the business forward.  Providing courteous. 17 . The market size for Fy01 is expected to be 7000mmbottles. Size. So the main mission of Pepsi is to capture the Rural Markets to make it a one-man show. The market. MARKET SIZE AND GROWTH RATE The particular feature of market is that of positioning & targeting of various brands while cola brand of Coke is targeted at teenagers & is positioned as refreshment for mind & body. only 40% people drinks soft drinks.  Exploring & developing opportunities that helps in building competitive edges. prompt & efficient service to our customer. The market growth of 22% till last year target still due to high excise duty of 40% leading to higher price of the end product.

Pepsi Diet 4. Slice 6. There market share are as follows- 18 . In summer the high season starts for 70-75 days. Second Mineral water and other are running successfully in the market. Blue Pepsi 3. They are completely defined below1. At present time Pepsi provides two new soft drinks. 7up 7. Dew Mountain Now here we will discuss about the market shares of each brands of soft drinks. Sale of soft of Drinks takes place during summer while just 5-6% of the total sales take place in the winter. Pepsi 2. which contributes more than 50% of the total year‘s sales.Another skew ness is in terms of the time of the year when the consumption takes place. BRAND PROFILE PepsiCo Company provides five brands of Soft drinks. Miranda (Lemon + Mango) 5. Aquafina 8. In all brands of Pepsi one is Soda. Dew Mountain and Blue Pepsi and above marketed with reasonably good success.

200ml launched in the year of 1999 and I lit.) in the month of June 95. 600ml. 1lt. 600ml 330ml. 2lt. 300ml. 2lt 200ml. 300ml. 600ml.S. 500ml 200ml. 300ml. 300ml.5 lit bottle launched in the year 1996 while 500ml and 2 it launched in 2000.5% 3% 2% 8% 6% Quantity 200ml. 19 . Mineral water. 200ml.5% Not Available 1.Soft Drinks Pepsi Mirinda (Orange) Mirinda (Lemon) Slice Teem Soda 7UP Aquafina Blue Pepsi Dew Mountain Pepsi Diet SOFT DRINKS Pepsi Mirinda Orange Mirinda Lemon Slice 7up Teem Soda Pepsi Diet Aquafina Dew mountain Blue Pepsi Market Share 57% 16% 2% 1. 500ml 1lt 200ml 500ml of Quantity Details of all brands Soft drinks are given as below— The PepsiCo company had provided its 300ml bottle soft drinks(B. 2lt 250ml. 1lt. Aquafina had been launched in the year 2001. 2lt 300ml. 1.D. 600ml. 1lt.

Blue Pepsi 200ml. 500.Dew mountain. The companies have divided the country into various regions and established a franchisee in each region. has been launched in the year 2003. Pepsi indulges mainly in direct contribution lo retailer and resorts to indirect in certain areas. 20 . It is more like an agent network. ml. Pepsi distributes through three channels which is shown below: PEPSI BOTTLING PLANT WAREHOUSE FRANCHISEE DEALERS RETAILERS CONVENTIONAL RETAILERS NON-CONVENTIONAL RETAILERS There is no involvement of wholesalers in the distribution of products. The franchisees have their own bottling plants and manage all the day to day operations. PEPSI DISTRIBUTION CHANNEL Pepsi's main strategy is to operate franchisee (Franchisees owned Bottling operation).

Thus. GLASS – 200 ml.PACKAGING Packaging plays a vital role in increasing decreasing in the sales of the products. packaging of the product should be attractive and product should be available in different sizes.5 liters. TETRA . PET . 3. and 200 ml / 250 ml (slice). 330 ml (Can). 600 ml. CANS . To keep in mind the importance of packaging PepsiCo and Coca cola is adopting new technology for looking the products attractive and producing the product in different size..500 ml. 300 ml. RANGES OF DIFFERENT PACK AVAILABLE 1. 1 liter and 2 liter. 1. 2 liters.. 300 ml. 600 ml (promotional pack with 100 ml extra).200 ml (SLICE) 4. The different pack sizes available are 200 ml.330 ml IN GLASS          CANS  24 cans * 330 ml = 1 Case 21 24 Bottles * 200 ml = 1 Case 24 Bottles * 250 ml = 1 Case 24 Bottles * 300 ml = 1 Case 6 Bottles * 1000 ml = 1 Case IN PET 24 Bottles * 500/600 ml = 1 cartoons 12 Bottles * 1000 ml 9 Bottles * 2000 ml 12 Bottles * 1500 ml = 1 cartoons = 1 cartoons = 1 cartoons TETRA 24 Bottles * 200 ml = 1 Case .. I liters. 1 liter and 250 ml. 2.

music. We.ADVERTISING STRATEGIES ADOPTED BY AERATED SOFT DRINK INDUSTRY Soft drinks is perhaps the most hard fought product categories in India in every respect . This paper tries to throw some light on the following aspects:     Genre wise and channel wise composition of advertising on TV Advertising strategy adopted by the aerated soft drink players on TV and press Zone wise and genre wise advertising on press Specific case: zone wise and genre wise advertising for Pepsi and Coke Genre wise analysis on aerated drinks establishes that this category is heavily advertised on feature films. Major part of the advertising on Cricket can be attributed to the fact that Pepsi was the official sponsor of the Cricket 22 . However. cricket and soaps. while Pepsi dominated media budgets during World Cup. pricing. distribution.media. this time we at AdEx thought of dwelling on aspects of advertising in terms of strategy adopted by the different players in this category and the duration of advertising across genres on TV and press. communication. at AdEx India... endorsements and so on. Interestingly. Every year it consistently emerges as one of the top 10 categories on television. Coca-Cola seems to have been the dominant spender in the month of September. have looked at year 2003 to understand the year that was for this exceptionally competitive segment! One clear and predictable pattern in 2003 was the two clear peaks of ad spend one during the world cup and the other during the festive time. events.

3 per cent.World Cup 2003. it's a pitched battle all the way -. However. Mirinda Orange. FIGHT FOR THE MARKET SHARES With the cola majors busy sharpening their arsenal. the combined market share of all carbonated soft drinks (CSD) beverages under PepsiCo's domestic product portfolio . wrestling etc. However. which occupy close to 70 per cent of the approximately 270-millioncases CSD market.including Pepsi. The combined market shares of Coca-Cola and Thums Up stands at 49 per cent. which tracks market figures for Coca-Cola India. ' According to figures released by IMRB. Mirinda Lemon and 7 Up -stands at 48. "We do not agree with the figures given by PepsiCo. apart from cricket Pepsi is actively present on other types of sports such as soccer. In the carbonated orange segment. which accounts for roughly 15 per cent of the 23 ." Pepsi's official spokesperson reiterated that among colas. according to IMRB. the combined market share of all Coca-Cola brands put together stands at 58 per cent. According to ORG-MARG. The IMRB data adds that with the exception of Mirinda Lemon. Coca-Cola's official spokesperson disagreed with these figures. how can their market shares be higher? The market shares they are stating are obviously questionable. when contacted by Business Line. in the month of January-February. While declining to provide individual market share of brands under the company's portfolio. all PepsiCo beverages have led over Coca-Cola's brands in terms of market share in this period. Brand Pepsi's market share stands at 51 per cent. Coca Cola India's official spokesperson sa1d. If our turnover last year was almost double theirs.whether on television or in the marketplace.

while the share of Mirinda Lemon is 25 per cent. which accounts for roughly 10 per cent of the CSD market. 24 . The market share of Coca-Cola's Fanta brand is estimated at 47 per cent. the market share for Mirinda Orange has been estimated at 53' per cent by IMRB. In the cloudy lemon segment.overall CSD market. the share of the cloudy lemon segment has slipped below that of the orange segment. According to industry estimates. Limca has a 75 per cent size of this segment. the cloudy lemon segment does not exist in most developed markets. and is primarily a developing country phenomenon. Interestingly. Coca-Cola's Limca brand leads PepsiCo's Mirinda Lemon by a huge margin.

Reinemund was especially upbeat about the 25 ." he says. chairman of the board and CEO of The Coca Cola Company. "We have learnt this lesson and reverted to higher price points (in India) after having achieved our objective of 150 million consumer footprints. Since 1989 the $27 -billion food and beverages giant has invested $700 million in India and seen a steady double-digit growth in its volumes. who chose to visit India on taking charge of Coke's global operations a few months ago. We do not see any depth in our future pricing and therefore. Reinemund's visit was preceded by that of E Neville Isdell." Steve Reinemund. chairman & CEO PepsiCo told the media in New Delhi. "It is time now to increase the depth of consumption. up from just $3 million in 1991. we have changed our strategy. However. He said with the strategy PepsiCo had attained critical mass.PEPSICO: SOON TO HIT $ 1-BILLION MARK IN INDIA PepsiCo will soon join the elite band of companies with $l-billion sales in India. "We are on track to make it the second or third largest." Pepsi Co is now making operating profits in India and its exports are worth over $60 million. The company currently has sales of $700 million. Reinemund said PepsiCo's Rs5-per-packaffor_bility strategy initiated by Coke and Pepsi had worked well in India and helped the company increase its consumer base from 150 million to 250 million. he admitted that the company was forced to hike its prices recently as there was an affordability challenge all over the world. The Indian operations are the Atlanta based company‘s: fifth largest outside the US now.

It has relationships with over 2. The company introduced farmers in India to six high-yield potato varieties and helped development of new seeds which helped increase the total annual production of tomatoes from 28.000 people in India directly and over 60." he said.‖ We are planning a significant increase in our manpower exports from India. He said PepsiCo employed more than 4. which he said was the fastest growing segment for five consecutive years. Reinemund said PepsiCo India was being run without any expatriates and40 officials from the Indian operations had so far been placed in the company's global businesses. since of the 37 bottling plants in the country. 17 company-owned bottling plants accounted for 55 per cent of total production.000 indirectly with its concept of contract farmiJ1g in India. specially the special excise duty of eight per cent levied on carbonated soft drinks. 26 . The company had no plans to make any structural changes in India said Reinemund.000 tones to over 250.000 farmers. Extolling Indian corporate talent." he said. Sources said Reinemund was likely to discuss issues of future investments and the high taxation policy of the government towards the soft drinks industry and the overall fiscal environment with Chidambaram and other senior government officials. in India. Coca-Cola and PepsiCo have been urging the government for lowering taxes. "India is clearly one of our priority markets.company's snacks business Frito Lay. He dismissed reports that arch rival Coke was closing in on the sales of Pepsi products and said Pepsi's leadership position was because Indians loved its products. Reinemund met finance minister P Chidambaram and planning commission deputy chairman Montek Singh Ahluwalia later in the day.000 tones in Punjab.

poster. hanger. ADVERTISING AND PUBLICITY PepsiCo is one of the biggest end spenders in India. Allahabad territory has assigned two local advertising agencies R. D. is known for its broad cast advertising but it also spends a lot in non broad cast advertising i. It is also one of the biggest global end spenders. dealer board. the expenses of these type of advertising are made at territory or unit level. Associates and Krishna for its territorial advertising.This is Reinemund's first visit to India and signifies the increasing importance of Indian operations for PepsiCo. banners. wall paintings and news paper. Saif Ali Khan. stickers. Hindustan Thompson Associates. glow signboard. specialties.e. hoarding. It has a long list of endorsers from pop star Ricky Martin to film star Sharukh Khan. 27 . India is now among the top eight businesses of PepsiCo worldwide in terms of beverage and snack sales and second only to China within Asia. Karina Kapoor. the big guest advertising agency of India has the account of PepsiCo. Pritey Jienta. Fardin Khan and Amitabh Bachchan.

Pepsi's Products 28 .

In this scheme some number are given under the bottle of Pepsi and company announces some lucky number. 1. Display Rack Scheme: This scheme is only for retailers. Miranda U. After completion of one-month different gift packs are distributed to the retailers.T. In this scheme some dollar amount is given under the bottle and the consumer may collect these dollars and add it. scheme meaning Under the Crown. 4. If this number is matched with the number under the crown number then the owner of that bottle wins different cash prizes. During my training period two types of consumer schemes and two types of retailer schemes were going on. The rack is filled with different bottles of Pepsi. 3. Hai Koi Jawab: This scheme was launched on 300ml bottle of Pepsi.C. Scheme meaning under the crown. The retailers are instructed that if they will maintain their racks in the same condition as it was when it was purchased. Company provided different gift packs on different crown number. The free flavors scheme varies from one bottle to many bottles.C: This scheme was launched on 300ml bottle of Miranda. Free Flavors.T.C. This is U.T. 2. In this scheme company provides a Pepsi rack to retailer. To Retailers: Company offers few bottle flavors free to retailers on purchase of one carat of flavor on some specific days. The schemes are of two types one for Consumers and other for retailers. Their schemes are offered by the company to maintain the competition at it is offered on those days when Coca-Cola offers any similar scheme.MARKETING SCHEMES For increasing the market share and beating the competitors company provides different schemes on different time. This is U. 29 .

Many possibilities can be collected into four groups of Variables know as ―Four Ps‖ i. Place: They are mostly available in al place but easily available in the Urban Market but not frequently found in Rural Market. Product: Product means the good and service combination of the company offered to the target market. 4 P‘s represent the main features of product. flavor brand name of the product after one or two year. 30 . Company changes the sizes.4 P’S 4 P‘s is the main features that directly affect the organization without 4 P‘s organization is not able to produce the product. variety. promotion. But dealers rarely charge the full sticker price. place. product. Promotion: Promotion means activities that communicate the merit of the product and persuade target customers to buy it. price. If the Pepsi is available to capture the rural market then it is certain that it will occupy first position of soft drinks industry.e. The measurement factor to promote the Pepsi product is to increase good transportation in rural market. Price: Price is the amount of money which customers have to pay to obtain the product calculates suggested retails prices that its dealers might charge for sources.

Returns      Price List Price Discounts Allowances Payment Period Creditors Target Customers Intended Positional Place Promotion     Advertising Personal Setting Sales Promotion Public Relations       Channels Coverage Assortments Locations Logistic Inventory Transportation 31 .Product     Product Variety Quality – Sizes Features – Services Brand Name – Warranties  Packaging.

bonuses. VP Mr. Officer. Committee Mr.83M $ 5. "Pay" is salary. etc. Gary P.. Director and Member of Exec. Irial Finan . VP and Pres of Bottling Investments & Supply Chain Dollar amounts are as of 31-Dec-08 and compensation values are for the last fiscal year ending on that date. Pres.400 Index Membership: Sector: Industry: Employees (last reported count): OFFICERS Pay Mr. GA 30313 Phone: 404-676-2121 Fax: 404-515-5997 Web Site: http://www. "Exercised" is the value of options exercised during the fiscal year. Muhtar Kent . 58 Chief Exec. Pres of Africa Group and Chief Operating Officer of Africa Group Mr. Cummings Jr. Officer. VP. $ 1.59M $0 $ 1.Soft Drinks 92. 32 . Exec.com/ DETAILS Dow Jones Composite Dow Industrials S&P 100 S&P 500 S&P 1500 Super Comp Consumer Goods Beverages . 56 Chief Financial Officers and Exec.86M $0 $ 2.60M $0 Exercised $0 $ 1. Alexander B. Fayard . 52 Chief Admin. José Octavio Reyes .cocacola.13M $0 51 Exec. 56 Pres of Latin America and Chief Operating Officer of Latin America Mr.The Coca-Cola Company One Coca-Cola Plaza Atlanta.

The company‘s sparkling beverages include nonalcoholic ready-to-drink beverages with carbonation. teas. flavored waters and enhanced waters. and sports drinks. Its still beverages consist of nonalcoholic beverages without carbonation. distributors.REUTERS ABRIDGED BUSINESS SUMMARY The Coca-Cola Company manufactures. and fountain retailers. including non-carbonated waters. syrups. distributes. such as energy drinks. The Coca-Cola Company also offers fountain syrups. and beverage concentrates and syrups to bottling and canning operators. Georgia. coffees. juices and juice drinks. fountain wholesalers. such as flavoring ingredients and sweeteners. It sells its finished beverage products primarily to distributors. and concentrates. and Sprite brand names. The Coca-Cola Company also owns mineral water brands Kildevaeld and Kurvand in Denmark and soft drink brand Hyvaa Paivaa in Finland. and markets nonalcoholic beverage concentrates and syrups worldwide. 33 . The company markets its nonalcoholic beverages under the Coca-Cola. The company was founded in 1886 and is headquartered in Atlanta. Fanta. and carbonated waters and flavored waters. Diet Coke. It principally offers sparkling and still beverages.

In 2000.2 3 Encouraged by its 2002 performance. Coke‘s acquisition of local popular Indian brands including Thums Up (the most trusted brand in India2 1). and distribution assets but also strong consumer preference. Limca. This combination of local and global brands enabled Coca-Cola to exploit the benefits of global branding and global trends in tastes while also tapping into traditional domestic markets. the company launched the Kinley water brand and in 2001. From 1993 to 2003.22 by 2003. Citra and Gold Spot provided not only physical manufacturing. Coca-Cola India had won the prestigious Woodruf Cup from among 22 divisions of the Company based on three broad parameters of volume. including Coca-Cola. Coca-Cola India achieved 39% volume growth in 2002 while the industry grew 23% nationally and the Company reached break-even profitability in the region for the first time. plus the Schweppes product range. Coca-Cola returned to India in 1993. Coca-Cola invested more than US$1 billion in India. and quality. bottling. Maaza. Shock energy drink and the powdered concentrate Sunfill hit the market. Sprite and Fanta.000 local employees at its twenty-seven wholly-owned bottling operations supplemented by seventeen franchisee-owned bottling operations and a network of twenty-nine contract-packers to manufacture a range of products for the company. Leading Indian brands joined the Company's international family of brands. After a 16-year absence. Coca-Cola India produced its beverages with 7. profitability. Coca-Cola India announced plans to double its capacity at an investment of $125 million (Rs. 750 crore) between September 2002 and March 2003. diet Coke. making it one of the country‘s top international investors.COKE IN INDIA Coca-Cola was the leading soft drink brand in India until 1977 when it left rather than reveals its formula to the government and reduces its equity stake as required under the Foreign Exchange Regulation Act (FERA) which governed the operations of foreign companies in India. cementing its presence with a deal that gave Coca-Cola ownership of the nation's top soft-drink brands and bottling network. The complete manufacturing 34 .

Coke indirectly created employment for another 125. open-bay three wheelers. and ready-to-serve tea and coffee. 35 . Following his marketing responsibilities. The complexity of the consumer soft drink market demanded a distribution process to support 700. Marketing and was instrumental to the company‘s success in developing a brand relevant to the Indian consumer and in tapping India‘s vast rural market potential. Seen as the driving force behind recent successful forays into packaged drinking water.000 retail outlets serviced by a fleet that includes 10-ton trucks. supply. President and CEO of Coca-Cola India. Gupta served as Head of Operations for Company-owned bottling operations and then as Deputy President.25 In addition to its own employees. joined Coke in 1997 as Vice President. Gupta and his marketing prowess were critical to the continued growth of the Company.000 Indians through its procurement. and trademarked tricycles and pushcarts that were used to navigate the narrow alleyways of the cities. and distribution networks. Sanjiv Gupta.process had a documented quality control and assurance program including over 400 tests performed throughout the process. powdered drinks.

it franchised its bottling operations in the U. and personnel contributed to Coke‘s challenges as well with a lack of standard processes and training degrading quality. with more than 400 widely recognized beverage brands in its portfolio. was being sold in every state and territory in the United States. and government regulation all serving as barriers. Cuba. In spite of this reach. caps. and Panama.10 Headquartered in Atlanta with divisions and local operations in over 200 countries worldwide. Former CEO Robert Woodruff‘s insistence that Coca-Cola wouldn‘t buffer the stigma of being an intrusive American product. and effective advertising a challenge with language. volume was low. International expansion Coke‘s first international bottling plants opened in 1906 in Canada. Georgia. a pharmacist in Atlanta. machinery. who sold the syrup mixed with fountain water as a potion for mental and physical disorders.36 and instead would use local bottles. Coca-Cola continued working for over 80 years on Woodruff‘s goal: to make Coke available wherever and whenever consumers wanted it. growing quickly to reach 370 franchisees by 1910. Coca-Cola was the world‘s largest manufacturer.S. With the bubbles making the difference.. Coca-Cola was registered as a trademark in 1887 and by 1895. trucks.11 By the end of the 1920‘s Coca-Cola was bottled in twenty-seven countries throughout the world and available in fifty-one more. The formula changed hands three more times before Asa D. marketer. Candler added carbonation and by 2003. Coca-Cola generated more than 70% of its income outside the United States by 2003. an arm‘s reach of 36 . In 1899.HISTORY OF COKE The Early Days Coca-Cola was created in 1886 by John Pemberton. culture. quality inconsistent. and distributor of nonalcoholic beverage concentrates and syrups.

The ranking‘s methodology determined a brand‘s valuation on the basis of how much it was likely to earn in the future. stability. achieving only 0.desire. 37 .2% growth by 2000 (just under 10 billion cases) in contrast to the 5-7% annual growth experienced during the 1980‘s. The World’s Most Powerful Brand Inter brand‘s Global Brand Scorecard for 2003 ranked Coca-Cola the #1 Brand in the World and estimated its brand value at $70. While per capita consumption throughout the world was a fraction of the United States‘. and global reach. and assessing the brand‘s strength to determine the risk of future earnings forecasts. The looming opportunity for twenty-first century was in the world‘s developing markets with their rapidly growing middle class populations. Woodruff‘s patriotic commitment that every man in uniform gets a bottle of Coca-Cola for five cents. major beverage companies clearly had to look elsewhere for the growth their shareholders demanded. wherever he is and at whatever cost to our company was more than just great public relations. As a result of Coke‘s status as a military supplier. Considerations included market leadership. The Second World War proved to be the stimulus Coca-Cola needed to build effective capabilities around the world and achieve dominant global market share. distilling the percentage of revenues that could be credited to the brand.45 billion. CocaCola was exempt from sugar rationing and also received government subsidies to build bottling plants around the world to serve. Turn of the Century Growth Imperative The 1990‘s brought a slowdown in sales growth for the Carbonated Soft Drink (CSD) industry in the United States. incorporating its ability to cross both geographical and cultural borders.

Pepsi‘s appeal focused on youth and when Coke entered India in 1993 and approached the market selling an American way of life. can‘t beat the Feeling (1987). relevant. Pepsi‘s head-start gave Coke a disadvantage in the mind of the consumer. and a 1992 return to can‘t beat the real thing38) 20 linked that personality to the core values of each generation and established Coke as the authentic. 1969). As early as 1985. Punjab government-owned Punjab Agro Industrial Corporation (PAIC). becoming a fully-owned subsidiary and ending the JV relationship in 1994. and Voltas India Limited. and trusted refreshment of choice across the decades and around the globe. as a JV of PepsiCo. Pepsi tried to gain entry into India and finally succeeded with the Pepsi Foods Limited Project in 1988. coke is its (1982). 38 . creatively entering the market in the 1980‘s in advance of liberalization by way of a joint venture. well-liked slogans1 9 (it‘s the real thing38 (1942. Though Coke benefited from Pepsi creating demand and developing the market. it allowed Pepsi to gain precious early experience with the Indian market and also served as an introduction of the Pepsi brand to the Indian consumer such that it was well-poised to reap the benefits when liberalization came. it failed to resonate as expected.From the beginning.1 8 Its catchy. Coke understood the importance of branding and the creation of a distinct personality. Pepsi was marketed and sold as Lehar Pepsi until 1991 when the use of foreign brands was allowed under the new economic policy and Pepsi ultimately bought out its partners. Marketing Cola in India The post-liberalization period in India saw the comeback of cola but Pepsi had already beaten Coca-Cola to the punch. While the joint venture was only marginally successful in its own right. things go better with Coke38 (1963).

act local‖ mantra. informed by consumer insights. the degree of differentiation between consumer segments and their reasons for entering the category. and the degree to which brands in the category projected different perceptions to consumers were among the many important differences between how urban and rural consumers approached the market for refreshment. Recognizing that a single global strategy or single global campaign wouldn‘t work. The soft drink category‘s role in people‘s lives. after almost a decade of lagging rival Pepsi in the region. locally relevant executions became an increasingly important element of supporting Coke‘s global brand strategy. particularly in rural markets. focusing on differentiation through offering unique and compelling value. Coke India reexamined its approach in an attempt to gain leadership in the Indian market and capitalize on significant growth potential. In 2001. where both the soft drink category and individual brands were undeveloped. In rural markets. unique marketing strategies were required in urban versus rural India. with higher category and brand development. This lens. gave Coke direction on the tradeoff between focus and breadth a brand needed in a given market and made clear that to succeed in either segment. the task was to narrow the brand positioning. The foundation of the new strategy grounded brand positioning and marketing communications in consumer insights. 39 .2001 Marketing Strategy Coca-Cola CEO Douglas Daft set the direction for the next generation of success for his global brand with a ―Think local. acknowledging that urban versus rural India were two distinct markets on a variety of important dimensions. the task was to broaden the brand positioning while in urban markets.

India B: “Thanda Matlab Coca-Cola” Coca-Cola India believed that the first brand to offer communication targeted to the smaller towns would own the rural market and went after that objective with a comprehensive strategy. Coke was perceived as a luxury that few could afford. comprising the other 96% of the nation‘s population. 41% of its middle class. and 58% of its disposable income. 5 product. 30% of 2002 volume. 40 . 10 and an average day‘s wages around Rs. 100. the rural market was an attractive target and it delivered results. Brand Localization Strategy: The Two Indies India A: “Life ho to aisi” ―India A. This market accounted for 80% of India‘s new Coke drinkers.‖ (life as it should be) was the successful and relevant tagline found in Coca-Cola‘s advertising to this audience. Coke experienced 37% growth in 2003 in this segment versus the 24% growth seen in urban are as. celebrating the benefits of their increasing social and economic freedoms. and was expected to account for 50% of the company‘s sales in 2003. Additionally. with an average Coke costing Rs. per capita consumption doubled between 2001-2003. ―Life ho to aisi. Driven by the launch of the new Rs. This segment‘s primary need was out-of-home thirst-quenching and the soft drink category was undifferentiated in the minds of rural consumers. represented 4% of the country‘s population. ―India B‖ included small towns and rural areas.Rural Success Comprising 74% of the country's population.‖ the designation Coca-Cola gave to the market segment including metropolitan areas and large towns.3 3 This segment sought social bonding as a need and responded to inspirational messages.

000 in 2001 to 160. increasing market penetration from 13 to 25%. Coca-Cola won Advertiser of the Year and Campaign of the Year in 2003. This pricing strategy closed the gap between Coke and basic refreshments like lemonade and tea. Coca-Cola launched the Accessibility Campaign. At the same time. making soft drinks truly accessible for the first time.In an effort to make the price point of Coke within reach of this high-potential market. Coke invested in distribution infrastructure to effectively serve a disbursed population and doubled the number of retail outlets in rural areas from 80.‖ meaning cool/cold is also generic for cold beverages and gave ―Thanda Matlab Coca-Cola‖ delicious multiple meanings. or lemonade. to Rs.000 in 2003. and concurrently cutting the price in half. Coke‘s advertising and promotion strategy pulled the marketing plan together using local language and idiomatic expressions. smaller than the traditional 300ml bottle found in urban markets. 41 . As a result of the Thanda campaign. 5. ―Thanda. Literally translated to ―Coke means refreshment. introducing a new 200ml bottle.‖ the phrase directly addressed both the primary need of this segment for cold refreshment while at the same time positioning Coke as a ―Thanda‖ or generic cold beverage just like tea. lassi.

Coke India‘s Corporate Social Responsibility (CSR) initiatives were both community and environment-focused. the company committed itself to environmental responsibility through its own business operations in India including.  Ground water and environmental surveys before selecting sites. The company‘s mission statement. climate change and waste management initiatives. where primary education projects had been set up to benefit children in slums and villages. Priorities included education. and The Coca-Cola Foundation.CORPORATE SOCIAL RESPONSIBILITY As one of the largest and most global companies in the world. and the environment. 30-40 more we re created in the supply chain. The Company employed 7000 citizens and believed that for every direct job. where the Company supported community-based rainwater harvesting projects to restore water levels and promote conservation education.  Environmental impact assessment before commencing operations. In addition to outreach efforts. Coca-Cola‘s footprint in India was significant as well. by addressing water.‖ The Company has made efforts towards good citizenship in the areas of community. and other NGOs. UNAIDS. called the Coca-Cola Promise. focused on higher education as a vehicle to build strong communities and enhance individual opportunity. Their activities also included The Coca-Cola Africa Foundation created to combat the spread of HIV/AIDS through partnership with governments.  Environmental due diligence before acquiring land or starting projects. by improving the quality of life in the communities in which they operate. Coca-Cola took seriously its ability and responsibility to positively affect the communities in which it operated. and health. stated: ―The Coca-Cola Company exists to benefit and refresh everyone who is touched by our business. Like its parent. water conservation. where Coke India partnered with NGOs and governments to provide medical access to poor people through regular health camps. 42 .

 Energy conservation programs.  Ban on purchasing CFC-containing refrigeration equipment. Compliance with all regulatory environmental requirements.  50% water savings in last seven years of operations 43 .  Waste water treatment facilities with trained personnel at all company-owned bottling operations.