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A Summer Training Report On

Competitive Study on Pepsi and Coke

Submitted in partial fulfillment for the requirement of the award of degree in Post Graduate Program in Planning and Entrepreneurship
Under the Guidance of: Mr. Gurbandini Chabra
(Sales Manager)

SUBMITTED TO: Ms. Swati Shar a ($a%ult&' (BS)

SUBMITTED BY: Dee!a" #u ar MB) (*(D Se .)

RAI

!SI"ESS SC#$$%
&ARI'A A'

Mrs. Swati Sharma


Faculty in Marketing Department of Management Studies, Rai Business School- Meadows Campus, Faridabad- ! "#, $aryana %&ndia'

C(R)&F&C*)(
This is to certify that the project report entitled Comparative Study of Pepsi & Coke at COCA COLA, GHA !A"A# submitted in partial fulfillment of the requirements for the award of the degree of Post Graduate Pro$ram i% P&a%%i%$ a%d '%trepre%eurship to (A! )O*+#A,!O+, )arida-ad is a record of bonafide training carried out by Mr. #eepak .umar under my supervision and guidance and that no part of this report has been submitted for the award of any other degree/ diploma/ fellowship or similar titles or prizes.

Signature Faculty !lace " #ew $elhi $ate " %&th 'ugust( %))*

uide

+Swati Sharma,

S,*#'+,/S #'CLA(A,!O+

- hereby declare that the project report entitled Comparative Study of Pepsi & Coke conducted at COCA COLA, GHA !A"A# under the guidance of .s. Shruti Sharms (Faculty of HR, RBS- Meadows) submitted in partial fulfillment of the requirements for the degree of Post Graduate Pro$ram i% P&a%%i%$ a%d '%trepre%eurship to (A! )O*+#A,!O+, Meadows is my original wor/ and the same has not been submitted for the award of any other degree/diploma/ fellowship or similar titles or prizes.

!lace " Faridabad $ate " %&th 'ugust( %))* #''PA. .*MA(

AC.+O0L'#G'M'+,
The satisfactions that accompany the successful completion of any tas/ would be incomplete without mentioning the people who made it possible( whose consistent guidance and encouragement crown the success. - would consider it my privilege to e0press my gratitude and respect to Mr. Gur-a%di%i Cha-ra 1Sa&es Ma%a$er2 for having accorded me the opportunity to learn 1 e0perience the job profile in their organization. - cannot forget the contribution of COCA COLA as - troubled them through my queries at every stage of wor/ and - really appreciate the patience with which they resolved my doubts instead of their schedule. - would li/e to than/ my placement coordinator for his motivation and guidance( which were necessary in the completion of the project. - e0press my gratefulness to my faculty Miss Swati Sharma 1)a3u&ty2. am highly than/ful to them for their support to feel .2'$34S as a home away from home. - bestow my unbounded gratitude and deepest sense of respect and love to my venerated father for the tremendous help in strengthening my will and boosting my moral( which is beyond the level of ac/nowledgement.

DEEPAK KUMAR
!lace" Faridabad $ate" 'ugust %&th( %))*

CO+TE+TS
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OB-ECTI.E O$ T/E STUDY E1ECUTI.E SUMM)(Y I+T(ODUCTIO+ SO$T D(I+# I+DUST(Y 4(O$I5E O$ 4E4SI CO. T/E GE+ESIS O$ 4E4SI 4E4SI M)(#ETI+G ST()TEGIES MIC/E5 4O(TE( MODE5 $O( 4E4SI

*
2

6 7

(ESE)(C/ MET/ODO5OGY CO#E COMES TO I+DI) M)(#ETI+G ST)TEGIES O$ CO#E

ST)(ETEGIES )DO4TED BY CO#E )+D 4E4SI 4E4SI )+D CO#E M)(#ET S/)(E I+ I+DI) T/E CO5) 9)( S5OG)+S CE5IB(ITIES O$ 4E4SI )+D CO#E I+ I+DI) CO#E' 4E4SI I+ C)5O(IE B)TT5E CO#E .s 4E4SI:T/E +E9 CO5) 9)(S

4(ODUCT C/)()CTE(ISTICS O$ T/E 4(ODUCT

,;

)+)5YSIS

,, ,0 ,* ,2 ,3 ,6 ,7

B()+D 4(E$E(E+CES $I+DI+GS )+D )+)5YSIS 4UB5IC (E5ETIO+ )+G5E CO+C5USIO+ (ECOMM)+D)TIO+S BIB5IOG(4/Y <UESTIO++)I(E

OB-ECTI.E O$ T/E STUDY

To find out the market plan of the company over the competitors. To analyze the market share of PEPS . To study the consumer preference a!out PEPS .

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E1ECUTI.E SUMM)(Y
This pro#ect is an e$tensive research on the marketin% strate%ies of the t&o 'ola %iants Pepsi and 'oca 'ola. t covers an e$tensive survey and depict all %raphs( fact and fi%ures of t&o companies. t !e%ins &ith the introduction of soft drink industry and introduction of these t&o companies of soft drink industry. t covers some of the ma#or strate%ies adopted !y Pepsi and 'oca)'ola like their pricin% policy( sales promotion and advertisin% policy( distri!ution policy etc. The pro#ect has !een made interestin% &ith the inclusion of the topics( &hich covers the 4P*s of marketin%. The ma#or players in the soft drink industry in ndia are 'oke and Pepsi. Pepsi holds the ma#or market share follo&ed !y 'oke. They have a cut throat competition !et&een themselves. +hatever strate%y is follo&ed !y one company( it is copied !y the other. Sample of to !rands &ere selected on the !asis of there uses and noticecia!ility.

,ne of the selected !rand are -,. !rand in their respective product cate%ories the other one !rand is close competitor of the -o . !rands. Total sample of size of 2// respondents selected on the !asic of convenience &as surveyed &hich include consumers. Data was %=lle%ted >r= se%=ndar& as well as !ri ar& s=ur%es.

Stru%ture ?uesti=nnaire was use t= %=lle%t !ri ar& data

i +e ,e

I+T(ODUCTIO+:
n the modern ur!an culture consumption of soft drinks particularly amon% youn%er %eneration has !ecome very popular. Soft drinks in various flavors and tastes are &idely patronized !y ur!ane population at various occasions like dinner parties( marria%es( social %et to%ether( !irthday cali!ration etc. children of all a%es and %roups are especially attracted !y the mere mention of the &ord soft drinks.

+ith the %ro&in% popularity of soft drinks( the technolo%y of its production( preservation( transportation and or marketin% in the recent years has &itnessed phenomenal chan%es.

The so)called competition for this product in the market is from different other !rands. 1ass media( particularly the emer%ence of television( has contri!ute to a lar%e e$tent of the ever %ro&in% demand for soft drinks the attractive #in%les and sport make the lar%e audience remem!er this product at all times.

t is e$pected that &ith the sort of mass advertisin%( reachin% almost the entire country and offerin% various varieties annual demand for the product is e$pected to rise sharply in the times to come.

n any marketin% situation( the !ehavioral 3 environmental varia!les relatin% to consumers( competition and environment are constantly influ$. The competitors in a %iven industry may !e makin% many tactical maneuvers in market all the time. The may introduce or initiate an a%%ressive promotion campai%n or announce a price reduction. The marketin% man of the firm has to meet all these maneuver and care of competitive position of his firm and his !rand in the market. The only route open to him for achievin% this is the manipulation of his marketin% tactics. n today*s hi%hly competitive market place( three players have dominated the industry4 The -e& 5ork !ased Pepsi 'ompany nc. The 6tlanta !ased coca) cola and 7.8. !ased 'ad!ury Sch&eppes. Throu%h the %lo!e( these ma#or players have !een !attlin% it out for a !i%%er chunk of the ever 9%ro&in% soft drink market. -o& this !attle has !een evolved up to ndia too &ith the arrival of these three %iants. Soft drink industry is on amazin% %ro&th4 ultimately these are only one person &ho &ill determine their fortunes. The ndian consumer. The real +ar to :uench his thirst has #ust !e%un.

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SO$T D(I+# I+DUST(Y: )+ O.E(.IE9


t all !e%an in .006( &hen a tree le%%ed !rass kettle in ;ohn Styth pem!erton*s !ackyard in 6tlanta &as !re&in% the first P of marketin% le%ed. 7na&are the pharmacist has %iven !irth to a caromel colored syrup( &hich is no& the chief in%redient of the &orld*s favorite drink. The syrup com!ined &ith car!onated the soft drink market. t is estimated that this drink is served more than one thousand million times in a day. E:ually o!livious to the historic value of his actions &as <rank $. =o!inson( his partner and !ook keeper. Pem!erton > =o!inson laid the first foundation of this !evera%e &hen an avera%e nine drinks per day to !e%in &ith( uppin% volumes as sales %re&. n .024( this !evera%e %ot into !ottle( courtesy a candy merchant from 1ississippi. ?y the .25/*s 'olas &ere a daily consumption item( stored in house hold frid%es. Soon &ere !orn other non) cola variants of this product like oran%e > @emon. -o&( the soft drink industry has !een dominated !y three ma#or player 9 A.B The -e& 5ork !ased Pepsi co. nc.A2B The 6tlanta !ased coca cola co. A3B The united 8in%dom !ased 'ad!ury Sch&eppes. Thou%h out the %love these ma#or players have !een !attlin% it. ,ut for a !i%%er chunk of the ever)%ro&in% cold drink market. -o& this !attle has !e%un in ndia too. nida is no& the part of cold drink &ar. Cone are days of =amesh 'hauhan( ndia*s one time cola kin% and his !outs of pistol shootin%. E$pect no& to hear the !oon of cannons &hen the 'oca 'ola >
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Pepsi co. !attle it out for( as the Dordon %oes a !i%%er share of throat. ?y !uyin% over local competition( the t&o 6merican 'ola %iants have cleared up the arena and are packin% all their po&er !ehind !uildin% the ndian franchisee of their %lo!e %irdlin% !rands. The hu%e amount invested in fracture has never !een seen !efore. ?oth players seen an enormous potential in his country &here s&i%%in% a car!onated !evera%e is still considered a treat( virtually a lu$ury. 'onse:uently( !y &orld standards ndia*s per capita consumption of cold drinks as %oin% !y survey results is rock !ottom( less than over -ei%h!ors Pakistan > ?an%ladesh( &here it is four times as much. ?ehind the hype( in an effort invisi!le to consumer Pepsi pumps in =s 3/// crores A.224B to add muscle to its infrastructure in !ottlin% and distri!ution. This is apart from money that company*s franchised !ottles spend in up%radin% their plants all this has contri!uted to su!stantial %ains in the market. n colas( Pepsi is already market leader and in certain cities like Corakhpur( Pepsi outlets are on one side > all the other colas put to%ether on the other. +hile coke e$ecutive scruff at Pepsi*s claims as &ell as tar%ets( industry o!servers are of the vie& that Pepsi has definitely stolen a march over its competitor coke. 6part from num!ers( Pepsi has made :ualitative %ains. The foremost is its ima%e. This ima%e turnaround is no small achievements( considerin% that since it &as esta!lished in .202( takin% the hardship route prior to li!eralization and &ei%hed do&n !y e$port commitments. -o&( at present as there are three ma#or players coke( Pepsi and 'ad!ury and there is stiff competition !et&een first t&o( !oth Pepsi and coke have started( sponsorin% local events and sta%in% fre:uent consumer promotion campai%ns. 6s the me%a event of this century has started( and the marketers
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are usin% this event 9 &orld cup foot!all( cricket events and many more other events. @ike Pepsi( coke is pickin% up e:uity in its !ottles to %uarantee their financial support4 one side coke is tryin% to increase its popularity throu%h. Eat $==d' en@=& $==d. Drin" =nl& %=%a %=la. Eat %ri%"et' slee! %ri%"et. Drin" =nl& %=%a %=la. Eat =Aies' slee! =Aies. Drin" =nl& %=%a %=la.

,n the other side of coin Pepsi has introduced 61 T6?; ?6';;6- for capturin% the lemon market throu%h 1 = -E6 9 @emon &ith F B=r "a @hat"a dhere se lageC. ?ut no dou!t* that 78 !ased 'ad!ury is also eco%nisin% its presence. So there is a real crush in the soft drink market.&ith launch of the car!onated or%anize drink 'rush( fe& year a%o in Corakhpur.( the first in a series of a launches ( 'ad!ury Sch&eppes !evera%e ndia A'S? B ;6S P@6--EEG) The &orld third lar%est soft drink marketers all over the country.'S? o &holly o&ned su!sidiary of the @ondon !ased H 6.52!illion. 'ad!ury Sch&eppes is hopin% that crush is %oin% &ell and &ell not suffer the same fate as the =s. ."5 crore 'ad!ury india*s apple drink 6pella. 'S? is no& &ith oran%e AcrushB( and Sch&eppes soda in the market.

6s oran%e drinks are the smallest of non)cola cate%ories that is =s. ..// crore market &ith ./I market share and cola heavin% 5/I is follo&ed !y @emon se%ment &ith 25I.

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The success of soft drink industry depends upon 4 ma#or factors viz. )Aailabilit& .isibilit& C==ling (ange

).)I5)BI5ITY
6vaila!ility means the presence of a particular !rand at any outlet. f a product is no& availa!le at any outlet and the competitor !rand is availa!le( the consumer &ill %o for the at !ecause %enerally the consumption of any soft drink is an impulse decision and not predetermined one.

.ISIBI5ITY
Jisi!ility is the presence felt( if any outlet has a particular !rand of soft drink say) Pepsi cola and this !rand is not displayed in the outlet( then its availa!ility is of no use. The soft drink must !e sho&n off properly and attractively so as to catch the attention of the consumer immediately Pepsi achieves visi!ility !y providin% %lo& si%n!oards( hoardin%( calendars etc. to the outlets. t also includes various stands to display Pepsi and other flavours of the company.

COO5I+G
6s the soft drinks are consumed chilled so coolin% them plays a vital role in !oostin% up the sales. The !rand( &hich is availa!le chilled( %ets more sale then the one &hich is not( even if it is more preferred one.
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()+GE
This is the last !ut not the least factor( &hich affects the sale of the products of a particular company. =an%e availa!ility means the availa!ility of all flavors in all sizes.

4(O$I5E O$ 4E4SI CO.


Pepsi'o is the .0th lar%est 6merican 'ompany &ith its &orld&ide operations in .2/ countries. The company employees over half a million persons and is possi!ly the lar%est employer. Pepsi'o has set up a fully inte%rated operation in ndia) manufacturin%( research and development( marketin%( distri!ution( coverin% fruit3ve%eta!le processin%( e$ports( snack foods( !evera%es and restaurants( includin% franchisin% of !evera%e territories for !evera%e !usiness and restaurants it has set up a holdin% company to further accelerate %ro&th in the future throu%h ne& initiatives and #oint ventures. Pepsi'o started its operations in ndia in .202 &ith the formation of Pepsi <oods @imited. 6ll of Pepsi*s !usinesses are employment intensive. Pepsi'o employs over 35/// persons directly and indirectly in its !evera%e !usiness and other operations. 20 !ottlin% plants and ne& pro#ects are com!in% up in +est ?en%al( 8arnataka( =a#asthan( Cu#rat and 1aharashtra. n 1ay .22/( Pepsi &as launched in Daipur. Pepsi !roke its advertisin% campai%n F6re you ready for the ma%icK featurin% =emo fernandes and Duhi 'ha&la on .5th 6u%ust .22/. Since then this ma%ic has &on millions of ndian hearts . Startin% from a Lero !ase( Pepsi( today( en#oys a leadership in 'ola cate%ory. The

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company*s !evera%e !rands are Pepsi( Seven 7p ( 1irinda @emon( 1irinda ,ran%e and Slice. t also has Eukes( lemonade( and Eukes Soda. The snack foods are =uffles( 'heetos and @ehar -amkeen. Pepsi services all retailers at least thrice a &eek and in summer( very often( t&ice a day. The company alon% &ith the franchisees has 25 !ottlin% plants spread all over ndia( of &hich .2 plants are o&ned !y Pepsi'o. Pepsi'o is plannin% to invest another =s. 5// crore in its ndian operation in the ne$t t&o years. Each year( Pepsi is likely to %enerate an additional employment of 5(/// persons in its !usiness alone.

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COM4)+Y 4(O$I5ED4e!siC= In%.

Pepsi'o is one the lar%est companies in the 7.S. t fi%ures amon%st the lar%est .5 companies &orld&ide accordin% to the num!er of employees hired. ts has a 7.S. <ortune rank of 5/.The company profits for .22" &ere H2..4 !illion on revenues of H2/.22 !illion and Pepsi is !ottled in nearly .2/ countries. Pepsi'o is a &orld leader in the food chain !usiness. t consists of many companies amon%st &hich the prominent once are Pepsi)'ola( <rito)@ay and Pepsi <ood nternational. The %roup is presently into t&o of the most profita!le and profita!le and %ro&in% industries namely( !evera%es and snack foods. t has scores of !i% !rands availa!le in nearly .5/ countries

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across the %lo!e. The %roup has esta!lished for itself once of the stron%est !rands in various se%ments of its operations. The !evera%es se%ment primarily markets its Pepsi( Eiet Pepsi( 1ountain Ee& and other !rands &orld&ide and ")7P outside the 7.S. markets. These are positioned in close competition &ith 'oca)'ola nc. of 7S6. 6 point &hich is &orth a mention is that 'oca)'ola %ets 0/I of its profits for nternational operations &hile the same fi%ure for Pepsi'o stands at 6I. The se%ment is also in the !ottlin% plants and distri!ution facilities and also distri!utes the ready to drink tea products of @ipton in -orth 6merica. n a #oint venture &ith orient spray #uice products Pepsi'o also manufactures and distri!utes fruit #uices. The snack food division manufactures and distri!utes and markets chips and other snacks &orld&ide. The international operations of this se%ment e$tends to the markets of 1e$ico( the 78 and 'anada. <rito)@ay represents this se%ment of Pepsi'o. The restaurant se%ment earlier primarily consists of the operations of the &orld&ide Pizza ;ut( Taco ?ell and 8<' chains. P<S. Pepsi 'o*s restaurant distri!ution operation( supplies company o&ned and franchise restaurants in the 7.S. The company ventured into restaurant !usiness &ith Taco ?ell( 8<'( Pizza ;ut ended last year &hen they &ere spinned off from the company. 6 packa%ed %oods company comprised of Pepsi)'ola 'ompany and <rito)@ay &ill continue to !ear the Pepsi'o name. The move should enhance !oth corporations a!ility to prosper &ith their o&n fully dedicated structure and mana%ement team.
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T/E GE+ESIS O$ 4E4SI


The Summer of 1898, as usual, was hot and humid in New Bern, North Carolina. So a youn !harmacist named Cale" Bradham "e an e#!erimentin with com"inations of s!ices, $uices and syru!s, tryin to create a refreshin new drin% to ser&e to his customers ' he succeeded "eyond all e#!ectations "ecause he in&ented the "e&era e now %nown around the world as (e!si'Cola. 'ale! ?radham kne& that to keep people returnin% to his pharmacy( he &ould have to turn it into a %atherin% place. ;e did so !y concoctin% his o&n special !evera%e)a soft drink. ;is creation( a uni:ue mi$ture of kola nut e$tract( vanilla and rare oils( !ecame so popular his customers named it M?radNs Erink.M 'ale! decided to rename it MPepsi)'ola(M and advertised his ne& soft drink. People responded( and sales of Pepsi)'ola started to %ro&( convincin% him that he should form a company to market the ne& !evera%e. ;is creation( a uni:ue mi$ture of kola nut e$tract( vanilla and rare oils( !ecame so popular his customers named it M?radNs Erink.M 'ale! decided to rename it MPepsi)'ola(M and advertised his ne& soft drink. People responded( and sales of Pepsi)'ola started to %ro&( convincin% him that he should form a company to market the ne& !evera%e.

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n .2/2( he launched the Pepsi)'ola 'ompany in the !ack room of his pharmacy( and applied to the 7.S. Patent ,ffice for a trademark. 6t first( he mi$ed the syrup himself and sold it e$clusively throu%h soda fountains. ?ut soon 'ale! reco%nised that a %reater ,pportunity e$isted ) to !ottle Pepsi so that people could drink it any&here. The !usiness !e%an to %ro&( and on Dune .6(.2/3( MPepsi)'olaM &as officially re%istered &ith the 7.S. Patent ,ffice. That year( 'ale! sold "(260 %allons of syrup( usin% the theme line MEEhilarating' InAig=rating' )ids Digesti=n.M ;e also !e%an a&ardin% franchises to !ottle Pepsi to independent investors( &hose num!er %re& from #ust t&o in .2/5( in the cities of 'harlotte and Eurham( -orth 'arolina( to .5 the follo&in% year( and 4/ !y .2/". ?y the end of .2./( there &ere Pepsi)'ola franchises in 24 states. ?uildin% a stron% franchise system &as one of 'ale!Ns %reatest achievements. @ocal Pepsi)'ola !ottlers( entrepreneurial in spirit and dedicated to the productNs success( provided a sturdy foundation. They &ere the cornerstone of the Pepsi)'ola enterprise. ?y .2/"( the ne& company &as sellin% more than .//(/// %allons of syrup per year. Cro&th &as phenomenal( and in .2/2 'ale! erected a head:uarters so spectacular that the to&n of -e& ?ern pictured it on a postcard. <amous racin% car driver ?arney ,ldfield endorsed Pepsi in ne&spaper ads as M6 !ully drink... refreshin%( invi%oratin%( a fine !racer !efore a race.M

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The previous year( Pepsi had !een one of the first companies in the 7nited States to s&itch from horse)dra&n transport to motor vehicles( and 'ale!Ns !usiness e$pertise captured &idespread attention. ;e &as even mentioned as a possi!le candidate for Covernor. 6 .2.3 editorial in the Creens!oro Patriot praised him for his Mkeen and ener%etic !usiness senseN. Pepsi)'ola en#oyed ." un!roken years of success. 'ale! no& promoted Pepsi sales &ith the slo%an( MErink Pepsi)'ola. t &ill satisfy you.M Then came +orld +ar ( and the cost of doin% !usiness increased

drastically. Su%ar prices seesa&ed !et&een record hi%hs and disastrous lo&s( and so did the price of producin% Pepsi)'ola. 'ale! &as forced into a series of !usiness %am!les #ust to survive( until finally( after three e$haustin% years( his luck ran out and he &as !ankrupted. ?y .22.( only t&o plants remained open. 'ale! returned to his pharmacy and put the valua!le Pepsi)'ola trademark up for sale. 6 -e& 5ork stock!roker( =oy '. 1e%ar%el( !ecame interested in Pepsi)'ola and for the ne$t ei%ht years stru%%led to save the Pepsi)'ola !usiness and trademark. ;e moved the companyNs operations from -e& ?ern( -orth 'arolina( to =ichmond( Jir%inia( in .223( and &ith his o&n funds made up the deficits the company incurred annually. ?ut !y .220( Pepsi &as in the hands of its fourth different o&ner( and in .23.( despite 1e%ar%elNs efforts( the company e$perienced its second !ankruptcy.

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t &asnNt until a successful candy manufacturer( 'harles C. Cuth( appeared on the scene that the future of Pepsi)'ola &as assured. Cuth &as president of @oft ncorporated( a lar%e chain of candy stores and soda fountains alon% the eastern sea!oard. ;e sa& Pepsi)'ola as an opportunity to discontinue an unsatisfactory !usiness relationship &ith the 'oca)'ola 'ompany( and at the same time to add an attractive dra&in% card to @oftNs soda fountains. ;e &as ri%ht. 6fter five o&ners and .5 unprofita!le years( Pepsi)'ola &as once a%ain a thrivin% national !rand. ,ne oddity of the time ) for a num!er of years( all of Pepsi)'olaNs sales &ere actually administered from a ?altimore !uildin% apparently o&ned !y 'oca)'ola( and named for its president. +ithin t&o years( Pepsi &ould earn H. million for its ne& o&ner. +ith the resur%ence came ne& confidence( a rarity in those days !ecause the nation &as in the early sta%es of a severe economic decline that came to !e kno&n as the Creat Eepression. The nation sank deeper and deeper into the Creat Eepression. Times &ere tou%h and five cents &as a lot to pay for a soft drink. So Cuth decided to make Pepsi)'ola an even more attractive value for hard)pressed consumers. n ?altimore( Pepsi !e%an sellin% a .2)ounce !ottle of cola for #ust a nickel ) t&ice as much refreshment as other soft drinks( for the same price( 'onsumers responded immediately( and Cuth e$panded the idea throu%hout the Pepsi)'ola system. Jery shortly( Pepsi)'ola &as once a%ain a healthy company( %ro&in% more stron%ly than ever. Eurin% the .23/s( international e$pansion !e%an in earnest. The trademark &as re%istered in @atin 6merica and the Soviet 7nion( and franchises &ere a&arded to !ottlers in 'anada.
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n .234( the company moved to a ne& head:uarters location in @on% sland 'ity( -e& 5ork( and four years later( in .230( +alter S. 1ack &as selected to !e the ne& president of Pepsi)'ola. 1ack !elieved that advertisin% could !e a cornerstone of soft drink marketin% and soon introduced a comic strip( M4e!si F4eteM( to promote PepsiNs pricin% advanta%e &ith the line MTwi%e as u%h >=r a ni%"el.M

,f course( other cola companies soon !e%an to sell .2 ounces at the same five)cent price. ?ut Pepsi &as the leader( and soon had another advanta%e ) a catchy son% a!out the product and its price( this time &ith Mtwi%e as u%h >=r a ni%"elM as its lyrics. The tune( M-ickel( -ickelM( &as the >irst adAertising @ingle to !e played and heard coast to coast on net&ork radio( makin% !roadcast and advertisin% history. n time( it !ecame so popular that it &as recorded in 55 lan%ua%es. 1ore than one million copies &ere released to #uke!o$es( and the tune( renamed MPepsi)'ola ;its the SpotM( &as even played in 'arne%ie ;all. n .24/( @ <E ma%azine &ent so far as to say it &as Mimmortal.M Eventually( Pepsi)'ola %re& to !e even lar%er than the company that o&ned it( and it &as decided to chan%e the name of @oft ncorporated to the Pepsi) 'ola 'ompany. Then( +orld +ar !rou%ht a &hole ne& environment for the %ro&in% company( #ust as it did for the &hole nation. Su%ar rationin%( &hich had contri!uted to the companyNs do&nfall durin% the <irst +orld

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+ar( &as reinstituted. ?ut 1ack( learnin% from the past( !ou%ht a su%ar plantation in 'u!a( and Pepsi continued to prosper.

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t &as an era of men and &omen in uniform servin% their country overseas( ans&erin% %reat challen%es in distant lands. n keepin% &ith the patriotic feelin%s of the era( Pepsi) 'ola adopted a ne& red( &hite and !lue colour scheme for its !ottles( and opened a 7S, 'anteen in -e& 5ork 'ityNs Times S:uare( &here more than a million families recorded messa%es for their youn% men and &omen servin% all over the &orld. 6fter +orld +ar &ould moved capture its the ( Pepsi)'ola spirit of a to

turned its attention to ne& ideas that victorious 6merica. The company head:uarters 1anhattan( and continued to e$pand overseas( into @atin 6merica( the Philippines and the

25

1iddle East. 6t home( the M-ickel( -ickelM advertisin% theme &as e$panded to include M9h& ta"e less when 4e!siGs bestHM The company also !e%an e$perimentin% &ith ne& !ottle sizes( and for the first time !e%an to packa%e Pepsi)'ola in cans. <or Pepsi)'ola( the N5/s &ere personified !y the companyNs ne& president( 6lfred Steele( a man of immense drive and vitality( &ho presided over an e$tended period of %ro&th and e$pansion. ?ut the post)&ar marketplace &as chan%in% rapidly. 6 ne& retail phenomenon called supermarkets &as !e%innin% to appear( and in com!ination &ith e:ually dramatic chan%es in the economics of producin% soft drinks( forced Pepsi to a!andon its strate%y of sellin% the soft drink for half the price of its chief competitor. Soon( the lon%)runnin% M-ickel( -ickelM advertisin% &as replaced &ith a claim more in keepin% &ith the ener%etic post)&ar 6merica( MM=re B=un%e t= the Oun%e with 4e!si.M Throu%hout this period( SteeleNs constant travellin% companion &as his &ife( kno&n to 6mericaNs film fans as the %lamorous movie star( Doan 'ra&ford. 1any !elieve that it &as stylish and sophisticated 1s. 'ra&ford &ho moved the company a&ay from its MvalueM theme of the N4/s into the more sophisticated campai%ns of the N5/s. @ater( after 1r. SteeleNs death in .252( she &as elected a mem!er of the !oard of directors.

26

6 ne& lo%o incorporatin% the Mb=ttle %a!M look &as adopted( and Pepsi &as no lon%er advertised !ased on price( !ut as a lifestyle accompaniment. MThe @i%ht =efreshmentM and M=efreshin% +ithout <illin% campai%ns also added a cosmetic appeal ) this in a period &ell !efore diet products emer%ed into consumer consciousness. ?y the mid).25/s( 6lfred Steele had !ecome chairman of PepsiNs !oard of directors( and ;er! ?arnett had replaced him as the companyNs president. nnovation continued( and a distinctive ne& Ms&irlM !ottle &as introduced in .250. That same year( a ne& advertisin% campai%n( M?e Socia!le( ;ave a Pepsi(M &as also launched. nternationally( Pepsi continued to e$pand( and &as no& availa!le in .2/ countries. The MSocia!leM &as the first campai%n to address a pro!lem Pepsi carried over from the lon% years of competin% as a !ar%ain !randG Pepsi had the ima%e of !ein% Mthe kitchen colaM) the !rand you poured into %lasses out of si%ht of your %uests to avoid the sti%ma of servin% a lo&)priced !evera%e. t &as also a precursor of thin%s to come. t &as the first Pepsi)'ola campai%n to focus on youn% people as the !randNs ma#or consumer tar%et( and &as soon follo&ed !y another youth)oriented campai%n( M-o& itNs Pepsi( for those &ho think youn%.M The sta%e &as set for another advertisin% !reakthrou%h. n the late .25/s( a demo%raphic phenomenon called the post)&ar M!a!y !oomM &ould chan%e forever the &ay 6merica &ould think( act and live. They &ere a ne&
2"

%eneration( not committed to values of the past( and headin% into the future &ith a conviction that &hat lay ahead &as !etter than &hat lay !ehind. Pepsi)'ola sensed that attitude and captured their spirit &ith a name that has stood the test of time. They &ere the Pepsi Ceneration. This van%uard of active( fun)lovin%( contemporary 6merica &ould claim Pepsi as its o&n( under the !anner M'ome 6live( 5ouNre in the Pepsi Ceneration.M That darin% campai%n launched in the early N6/s( set a ne& standard for advertisin%. t captured( like no other( a portrait of 6merica livin% life to the fullest. <or more than three decades( the spirit of that first Pepsi Ceneration campai%n has !een an inte%ral part of 6mericaNs !est)loved and most reco%nised advertisin% ) MDoin the Pepsi people( feelin% freeM ....... M5ouNve %ot a lot to live( PepsiNs %ot a lot to %iveM ... M;ave a Pepsi dayOM ........ M'atch that Pepsi SpiritOM ... MPepsi -o&OM ) campai%ns that for a :uarter of a century( held a mirror to the face of 6merica and reflected the !est of it. +hich is really &hat the Pepsi Ceneration set out to do in the first place. Eurin% its first 65 years( Pepsi)'ola 'ompany sold only one product)Pepsi. ?ut( &ith the !a!y !oom( not only did the nationNs population chan%e( so did the &ay it thou%ht of soft drinks. <or many people( soft drinks had to !e not #ust refreshin%( !ut a complement to diet ha!its as &ell. So( in .263( the company developed a ne& lo&)calorie drink &ith a taste &orthy of carryin% the Pepsi)'ola nameG Eiet Pepsi.

20

<irst advertised alon%side Pepsi( Eiet Pepsi later took on an identity of its o&n. ,ne of its earliest campai%ns( MCirl&atchers(M &as !uilt around a catchy #in%le that !ecame so popular it &as released as a commercial record and hit the Top 4/ list. n .264( 1ountain Ee&( a re%ional soft drink favourite( !ecame an important ne& addition to the %ro&in% family of Pepsi)'ola !rands( and its advertisin% theme( M5a)hoo( 1ountain Ee&(M !ecame the !randNs instantly reco%nisa!le si%nature. Pepsi in cans had !y no& proved so popular that full)scale commercial distri!ution !e%an in .265. That same year Pepsi)'ola 'ompany mer%ed &ith a successful Eallas( Te$as( marketer of salty snacks( <rito)@ay( nc.( to form Pepsi'o ) one of the %reat consumer products companies on the 7.S. !usiness scene. The follo&in% year the company opened its first soft drink operations in Eastern Europe and Dapan. 6 remarka!le !usiness phenomenon occurred as the .26/s %ave &ay to the N"/s. ?usiness people( the media and consumers !e%an to o!serve that Pepsi( an upstart( a%%ressive company( &as challen%in% the dominant soft drink company( 'oca)'ola( &ith increasin% success. The media named the competition Mthe cola &ars(M and as events &ere to prove( it &as to have far) reachin% effects on the soft drink industry. Throu%hout the fast)paced N"/s( Pepsi continued to evolve &ith the times. Early in the decade( t&o)liter !ottles &ere introduced( as &ere li%ht&ei%ht( recycla!le plastic !ottles that( &ith improvements in technolo%y( eventually
22

!ecame li%hter and stron%er than %lass. The company a%ain moved its head:uarters( this time from -e& 5ork 'ity to Purchase( -e& 5ork( a small su!ur!an to&n in +estchester 'ounty. Jic ?onomo( president of Pepsi throu%hout much of the N"/s( &as succeeded !y Dohn Sculley. 6s consumers chan%ed( so did Pepsi( and the Pepsi Ceneration stayed in perfect harmony &ith the temper of the times. Eiet Pepsi continued its remarka!le %ro&th( and 1ountain Ee& advertisin% appeared on national television for the first time. ,verseas( some .5 years after a remarka!le encounter !et&een 7.S. Jice President -i$on and Soviet Premier 8hrushchev at a trade sho&( Pepsi !ecame the first 6merican consumer product to !e manufactured in the Soviet 7nion. 1ean&hile( mid&ay throu%h the decade( The Pepsi 'hallen%e( a landmark marketin% strate%y( &as !orn &hen consumer test after consumer test confirmed that PepsiNs taste is superior to the lar%est !rand of cola. The 'hallen%e simply made that reality into advertisin%( &ith filmed taste tests !et&een Pepsi and 'oke. The campai%n made marketin% history( and is periodically re)introduced to ne& %enerations of consumers. ?y .2"6( in an unprecedented development( Pepsi)'ola !ecame the sin%le lar%est)sellin% soft drink !rand in 6merican supermarkets. ?y the time the .20/s da&ned( Pepsi &as clearly the num!er one !rand in take)home sales. The diet market continued its %ro&th( and &ith it( Eiet Pepsi. 6lmost no one noticed that the Pepsi Ceneration cele!rated its t&entieth anniversary. ?ut there &as more advertisin% history to !e made( includin% a campai%n the media descri!ed as Mthe most ea%erly a&aited advertisin% in
3/

history.M They &ere talkin% a!out PepsiNs .204 advertisin% campai%n( MPepsiG The Ch=i%e => a +ew Generati=nM( a campai%n that reaffirmed PepsiNs position on the leadin% ed%e of contemporary culture. n its early sta%es( the -e& Ceneration campai%n featured a youn% performer ) 1ichael Dackson ) &ho( ar%ua!ly( &as the eraNs !i%%est entertainment name. Dackson starred in a series of Pepsi)'ola commercials( and once a%ain( Pepsi had !roken dramatically from tradition and launched a ne& era in advertisin%. PepsiNs strin% of successes( from the Pepsi Ceneration up throu%h the Pepsi 'hallen%e and on into the -e& Ceneration advertisin%( &as havin% its effect in places other than Pepsi head:uarters. The companyNs !i%%est rival( 'oca) 'ola( stun% !y PepsiNs %ro&th and prominence( a!andoned its century)old 'oke recipe in favour of a ne& product formulated to taste more like Pepsi. Pepsi president (=ger Enri%= immediately declared victory in the cola &ars( and a&arded Pepsi employees &ith an une$pected holiday to cele!rate. ;o&ever( consumers :uickly re#ected the ne& 'oke( and in short order( 'oca)'ola &as forced to reinstate the ori%inal product under a ne& name( 'oca)'ola 'lassic. Throu%hout the N0/s( a lon% list of stars and superstars lent their ma%ic to Pepsi( includin% pop music icons @ionel =ichie( Tina Turner and Cloria and sports %reats Doe 1ontana and Ean 1arino. Ceraldine <erraro( the first &oman nominated to !e vice president of the 7.S.( starred in a Eiet Pepsi spot. 6nd the irrepressi!le 1ichael D. <o$ !rou%ht a special talent( style and
3.

spirit to a series of Pepsi and Eiet Pepsi commercials( includin% a classic( M6partment ./C.M 1ichael Dackson returned to star in the first)ever episodic commercial( M'hase(M &hich !ecame the most &atched commercial in history. Pepsi made its first trip on the space shuttle( carried in a specially desi%ned Mspace can(M and crossed yet another ne& frontier !y !e%innin% distri!ution in 'hina. ?y the middle of the decade( more than 6// Pepsi) 'ola plants &ere operatin% in .40 countries and territories throu%hout the &orld. n .20"( a spectacular Pepsi)'ola outdoor si%n appeared a%ain in Times S:uare in 1anhattan. The same year( %ro&th forced

construction of a ne& Pepsi)'ola head:uarters( this one in the northern +estchester to&n of Somers( -e& 5ork. The follo&in% year( =o%er Enrico named 'rai% +eatherup as president of Pepsi)'ola -orth 6merica. 6s PepsiNs !usiness throu%hout the &orld continued to increase in importance( 'hris Sinclair &as a president of Pepsi)'ola nternational in .202. 6s the .22/*s opened( so did a ne& era in PepsiNs international operations. The company si%ned the sin%le lar%est trade a%reement in history &ith the

32

Soviet 7nion. Seekin% lon%)term %ro&th( Pepsi invested in such hi%h) potential markets as 'hina( Eastern Europe( 1e$ico and 6r%entina. ?ack in the 7nited States( the N2/s ushered in a ne& %eneration of a&ard)&innin% advertisin%. The inimita!le =ay 'harles #oined the Pepsi family &hen ) !acked up !y the 7h);uh Cirls ) he starred in the most popular advertisin% campai%n of the time( Eiet PepsiNs N5ou %ot the ri%ht one !a!y( uhhuhOM Supermodel 'indy 'ra&ford helped introduce a ne& packa%e desi%n( and Pepsi reminded 6merica to M?e youn%( have fun( drink Pepsi.M 1ountain Ee&( includin% Eiet 1ountain Ee& ) !y no& the si$th lar%est soft drink trademark in the 7.S.) carried its appeal to Ceneration P on the shoulders of a %roup of outra%eous %uys &hose main claim to fame &as that theyNd M?een There( Eone That( Tried That.M 'omparative advertisin% in the form of Pepsi 'hallen%e commercials made its first appearance in @atin 6merica. 'affeine)free versions of Pepsi( Eiet Pepsi and 1ountain Ee& helped these !rands to e$pand their appeal( and Slice( a uni:ue line of flavours( added to PepsiNs soft drink portfolio. 'onsumers continued to !roaden their tastes in refreshment !evera%es( and Pepsi continued to chan%e to meet their preferences( even &hen it meant developin% into a ne& kind of company ) a total !evera%e company. -o&( in addition to !ein% one of the leadin% soft drink marketers in the &orld( Pepsi) 'ola( led !y 'rai% +eatherup and 'hief ,peratin% ,fficer ?renda ?arnes(

33

makes and markets a complete !evera%e offerin% desi%ned around the chan%in% tastes of the post)!a!y !oom %eneration. Throu%h a partnership &ith the Thomas D. @ipton 'ompany( Pepsi is the leadin% marketer of ready)to)drink iced teas. 6nother partnership &ith ,cean Spray has helped Pepsi emer%e as a leader in the sin%le)serve #uice market. 6nd 6ll Sport( a hi%h performance sports drink( is PepsiNs entry into that important and %ro&in% consumer market cate%ory. ?asket!all %reat Sha:uille ,N-eal carried PepsiNs lon% tradition of youthful fun for&ard( and !y the middle of the decade( &hen Pepsi advertisin% pointed out that M-othin% Else s a Pepsi(M it &as clear)consumers a%reed. <rom hum!le !e%innin%s in a -orth 'arolina pharmacy nearly a century a%o( Pepsi)'ola has %ro&n to !ecome one of the !est)kno&n( !est)loved products throu%hout the &orld. 6nd the company !ehind it ) Pepsi'o ) has %ro&n as &ell( standin% today as one of the top marketers of refreshment !evera%es any&here and every&here in the &orld. tNs not very likely that( from the perspective of his small -orth 'arolina pharmacy( 'ale! ?radham could ever have foreseen the %reat company Pepsi)'ola &ould someday !ecome. ?y .265( Pepsi)'ola and <rito)@ay( had mer%ed into a ne&( lar%er company named Pepsi'o. n the years since( Pepsi'o has %ro&n into one of the lar%est consumer products companies in the &orld. =emarka!le for a
34

company its size( Pepsi'o remains a true %ro&th company( increasin% its sales and its return to its investors every year since its foundin%. ?ut even more remarka!le is the surprisin% fact that Pepsi'o is no& the &orldNs lar%est restaurant company. Pizza ;ut( the &orldNs lar%est pizza chain4 8<'( the lar%est chicken)oriented chain4 and Taco ?ell( the lar%est 1e$ican food chain( are all Pepsi'o companies. 1ore than that( Pepsi'o has !ecome a truly international company. ts soft drinks and other !evera%es( snack foods of every variety and the Pepsi'o restaurants can today !e found in every corner of the %lo!e. Pepsi'o !rands and Pepsi'o operations today employ almost half a million people in .25 countries around the &orld. The company profit for .22" &ere H 2..4 !illion on revenues of H 2/.22 !illion and Pepsi is no& !ottled in nearly .5/ countries. 1ean&hile at the to&n &here it all !e%an on the Southern coast of -orth 'aroline( resident of -e& ?ern plan to honor their famous son &ith a parade( flotilla( and fire &ork display on 6pril 3)5( .220. 6n e$hi!it of Pepsi memora!ilia &ill !e put on display and Pepsi store and museum are !ein% !uilt on site of ?radham*s corner dru% store. These developments and many more will write Pepsi story for the next millennium - a story that was undoubtedly find a company with a vast resources , thriving businesses, extraordinarily financial strength and thousands of bright , dedicated people.

35

4E4SIIS M)(#ETI+G ST()TEGIES

Pepsi*s approach is radically different from that of 'oke( Pepsi has %one in for concentration se%mentation. Pepsi has tar%eted the youth se%ment instead of tryin% to !e somethin% to all se%ments. Pepsi has since the !e%innin% strove to achieve its international position as Qa drink for the ne& %eneration* in ndia. ;elped !y ;T6*s forceful visuals and creative( Pepsi has !een successful in positionin% itself for the youn%er %eneration.

SE55I+G 4(OCESS Pepsi has a very &ell mana%ed sellin% system. t takes as lot of care to ensure that the products APepsi !ottlesB are availa!le to the consumers. Pepsi soft drinks are produced in our plants and crates are supplier to shopkeepers directly. Corakhpur has !een divided around "5 routes &hich are called direct routes. <or every route there is a =outs 6%ent. =oute 6%ent moves &ith the company o&ned truck and ensure that ma$imum shops are covered each day( so that re%ular supply of Pepsi soft drinks is made.

36

=outs a%ents take the order from the shopkeepers and then &ith the help of loaders they %ive the re:uired num!er of crates to the 'rates from the outlet and then they move for the ne$t outlet. ,ur plants also have some a%ency in each routs. They supply in the areas &here Pepsi*s trucks are not a!le to reach. These areas are called indirect)routes.

3"

MIC/)E5 4O(TE( MODE5 $O( 4E4SI

4OTE+TI)5 BUYE(S

E+T()+TS

I+DUST(Y COM4ETITO(S

SU445IE(S

SUSTITUTES

6ll the three soft drink %iants i.e. Pepsi( 'oke( 'ad!ury Sch&eppes are already here. -o other company plans to enter this capital)intensive industry at the moment. The investment in this industry is more than =s..// per crate. This leaves no scope for small players &ho cannot match the mi%ht of

30

these three multinational %iants. Thus at the moment there are no potential entrants.

SU445IE(SG
The !ottlin% is done either !y franchises or !y company o&ned !ottlin% plants. There are .0 franchisee and .3 companies o&ned !ottlin% plants. The empty %lass !ottles and shells are sourced from local manufacturers. The in%redients for the concentrate are sourced and manufactured locally. There is a!undant supply of &ater and su%ar. Thus on the suppliers side Pepsi does not have a pro!lem. Presently the cans are imported and filled locally near Pune in 1aharashtra. Seein% the potential( various local manufacturers are settin% up plants for manufacturin% cans in ndia. Soon this pro!lem &ill also !e resolved.

BUYE(S
The follo&in% are the various market se%ments .. 2. 3. 4. 5. 6. ,n)premise market. ;ome market. 6t &ork market. 5outh market. Special events market. ;i%h visi!ility market.

'haracteristics of the market se%mentG )

32

.. On D !re ise

ar"et: D

This is other&ise called the F=oute marketK. This market caters to the people &ho are on the move ) people shoppin%( eatin% out( and %oin% to and from &ork( etc. ?ecause of this product display and advertisin% si%ns ) prominence !ecome more important to cash in on the impulse nature of the product.

2. /= e Mar"et: D
This market consists of people &ho !uy essentially for consumption at home. ?y and lar%e( the house&ife is the decision maker. The no. of zero) case calls is hi%her here than in route se%ment. Time spent per case is also hi%h. 'ash collection also poses pro!lems.

* )t w=r"D ar"et: D
This market comprises of consumers &orkin% in office factories and ndustrial esta!lishment etc. The sales can !e had either throu%h canteens or activatin% near!y outlets and developin% it properly. Cenerally( in this market( the time spent per outlet is :uite hi%h !ecause of formalities involved.

2. Y=uth Mar"et: D
This market is conceived as one of schools( colle%es( and youth clu!s. This is an important se%ment in terms of its lon% life and amena!ility effective
4/

advertisin%. 6ssociation of out product &ith a youth activity &ith %ood merchandisin% support &ill help develop the market &ell.

3. S!e%ial EAents Mar"et: D


This market comprises of people at picnics( parties social events( conferences etc. These are %enerally !ulk order markets and a %ood relation !et&een salesmen and consumers at lar%e( !ecomes important. a!out this demand. t is necessary to maintain a %ood information system to %et timely information

6. /igh .isibilit& Mar"et: D


This se%ment is not a very distinct market as such. This comprises of places &here there is a hi%h visi!ility to the product displayed. This is especially true of places &here lot of people passes throu%h such as 6irports and =ail&ay stations. These are the places( &hich can %ive impression to the people as to &ho is the market leader. Stren%thenin% this market &ill !e a re) enforcin% factor for over)all product ima%e in the market. People constantly move from one se%ment of our market to another durin% a day a consumer is a part of several market)se%ment( perhaps even all the se%ments.

SUBSTITUTES
6ny drink( &hich :uenches thirst( is a su!stitute. Thus this industry is hi%hly competitive as even &ater is su!stitute and almost a dozen products are launched every year. =ecently Ea!ar ndia @td. has launched F=ealK ) fruit #uices priced at =s.3/ for a 5//)ml.)tetra pack and the makers of F<rootiK

4.

have launched FDolly DellyK. ?ut no&adays( people prefer car!onated drinks !ecause of the taste( fizz and the fun element attached &ith it.

COM4ETITIO+: D
The other t&o ma#or players in this industry are 'oca 'ola and 'ad!ury Sch&eppes. The real competition is !et&een Pepsi and 'oke. Presence of competition &ill ensure e$pansion of the market !y collective efforts( &hich is %ro&in% at a rate of 25I annually. There is tremendous potential considerin% the per capita consumption of ndia( &hich is a measly /.6 liters as compared to 7S &here it is 03.5 liters. Presently Pepsi has stolen a march over its rival !ecause of its marketin% efforts.

42

(ESE)(C/ MET/ODO5OGY
MET/ODO5OGY =esearch is a common lan%ua%e refers to a search of kno&led%e. =esearch is scientific > systematic search for pertinent information on a specific topic( infect research is an art of scientific investi%ation. =esearch 1ethodolo%y is a scientific &ay to solve research pro!lem. t may !e understood as a science of studyin% ho& research is don*t scientifically. n it &e study various steps that are %enerally adopted !y researchers in studyin% their research pro!lem. t is necessary for researchers to kno& not only kno& research method techni:ues !ut also technolo%y. The scope of =esearch 1ethodolo%y is &ider than that of research methods. The research pro!lem consists of series of closely related activities. 6t times( the first step determines the native of the last step to !e undertaken. +hy a research has !een defined( &hat data has !een collected and &hat a particular methods have !een adopted and a host of similar other :uestions are usually ans&ered &hen &e talk of research methodolo%y concernin% a research pro!lem or study. The pro#ect is a study &here focus is on the follo&in% pointsG (ESE)(C/ DESIG+ 6 research desi%n is defined( as the specification of methods and procedures for ac:uirin% the nformation needed. t is a plant or or%anizin% frame&ork for doin% the study and collectin% the data. Eesi%nin% a research

43

plan re:uires decisions all the data sources( research approaches( =esearch instruments( samplin% plan and contact methods. =esearch desi%n is mainly of follo&in% typesG ) .. E$ploratory research. 2. Eescriptive studies 3. 'asual studies

E145O()TO(Y (ESE)(C/ The ma#or purposes of e$ploratory studies are the identification of pro!lems( the more precise <ormulation of pro!lems and the formulations of ne& alternative courses of action. The desi%n of e$ploratory studies is characterized !y a %reat amount of fle$i!ility and ad)hoc veracity. DESC(I4TI.E STUDIES Eescriptive research in contrast to e$ploratory research is marked !y the prior formulation of specific research Ruestions. The investi%ator already kno&s a su!stantial amount a!out the research pro!lem. Perhaps as a =esult of an e$ploratory study( !efore the pro#ect is initiated. Eescriptive research is also characterized !y a Preplanned and structured desi%n. C)SU)5 O( E14E(IME+T)5 DESIG+ 6 casual desi%n investi%ates the cause and effect relationships !et&een t&o or more varia!les. The hypothesis is tested and the e$periment is done. There are follo&in% types of casual desi%nsG . . 6fter only desi%n ?efore after desi%n

44

. J. J. J. J .
B)

?efore after &ith control %roup desi%n <our %roups( si$ studies desi%n 6fter only &ith control %roup desi%n. 'onsumer panel desi%n E$posit facto desi%n
D)T) CO55ECTIO+ MET/OD

4(IM)(Y

SECO+D)(Y

Eirect personal ntervie& ndirect personal ntervie& nformation from correspondents 1ailed :uestionnaire Ruestion filled !y enumerators.
Published Sources

5npublished Sources

Covt.pu!lication

=eport 'ommittees > 'ommissions Private Pu!lication =esearch nstitute

4(IM)(Y D)T) These data are collected first time as ori%inal data. The data is recorded as o!served or encountered. Essentially they are ra& materials. They may !e com!ined( totaled !ut they have not e$tensively !een statistically processed. <or e$ample( data o!tained !y the peoples.

45

SECO+D)(Y D)T) Sources of Secondary Eata <ollo&in% are the main sources of secondary dataG
.. O>>i%ial 4ubli%ati=nsG Pu!lications of the 4E4SI F CO#E and !y

the corporate office of 4E4SI F CO#E.


2. 4ubli%ati=ns

(elating t= TradeG Pu!lications of the trade

associations( stock e$chan%e( trade union etc.


3. -=urnalJ +ews!a!ers et%.G Some ne&spapers3 Dournals collect and

pu!lish their o&n data( e.%. ndian Dournal of economics( economist( Economic Times.
4. Data C=lle%ted b& Industr& )ss=%iati=nsG <or e$ample( data

availa!le &ith 4E4SI F CO#E..


5. Un!ublished DataG Eata may !e o!tained from several companies(

or%anizations( &orkin% in the same areas. <or e$ample( data on 4E4SI F CO#E ma%azines.

4eri=d => Stud&G This study has !een carried out for a ma$imum period of 0 &eeks. )rea => stud&G The study is e$clusively done in the area of marketin%. t is a process re:uirin% care( sophistication( e$perience( !usiness #ud%ment( and ima%ination for &hich there can !e no mechanical su!stitutes.

46

Sa !ling DesignG The convenience samplin% is done !ecause any pro!a!ility samplin% procedure &ould re:uire detailed information a!out the universe( &hich is not easily availa!le further( it !ein% an e$ploratory research. Sa !le 4r=%edureG n this study F#ud%mental samplin% procedure is used. Dud%mental samplin% is preferred !ecause of some limitation and the comple$ity of the random samplin%. 6rea samplin% is used in com!ination &ith convenience samplin% so as to collect the data from different re%ions of the city and to increase relia!ility. Sa !ling SiBeG The samplin% size of the study is .// users. Meth=d => the Sa !ling: 4r=babilit& Sa !ling t is also kno&n as random samplin%. ;ere( every item of the universe has an e:ual chance or pro!a!ility of !ein% chosen for sample. Pro!a!ility samplin% may !e taken inform ofG Si !le (and= Sa !ling

6 simple random sample %ives ea%h mem!er of the population an e?ual chance of !ein% chosen. t is n=t a haphazard sample as some people thinkO ,ne &ay of achievin% a simple random sample is to num!er each element in the samplin% frame Ae.%. %ive everyone on the Electoral re%ister a num!erB and then use random num!ers to select the re:uired sample.

4"

=andom num!ers can !e o!tained usin% your calculator( a spreadsheet( printed ta!les of random num!ers( or !y the more traditional methods of dra&in% slips of paper from a hat( tossin% coins or rollin% dice. S&ste ati% (and= Sa !ling

This is random samplin% &ith a systemO <rom the samplin% frame( a startin% point is chosen at random( and thereafter at re%ular intervals. Strati>ied (and= Sa !ling

+ith stratified random samplin%( the population is first divided into a num!er of parts or NstrataN accordin% to some characteristic( chosen to !e related to the ma#or varia!les !ein% studied. <or this survey( the varia!le of interest is the citizenNs attitude to the redevelopment scheme( and the stratification factor &ill !e the values of the respondentsN homes. This factor &as chosen !ecause it seems reasona!le to suppose that it &ill !e related to peopleNs attitudes Cluster and area Sa !ling Cluster sa !ling is a samplin% techni:ue used &hen MnaturalM %roupin%s are evident in a statistical population. t is often used in marketin% research. n this techni:ue( the total population is divided into these %roups Aor clustersB and a sample of the %roups is selected. Then the re:uired information is collected from the elements &ithin each selected %roup. This may !e done for every element in these %roups or a su!sample of elements may !e selected &ithin each of these %roups.

40

+=n 4r=babilit& Sa !ling t is also kno&n as deli!erate or purposive or #ud%e mental samplin%. n this type of samplin%( every item in the universe does not have an e:ual( chance of !ein% included in a sample. t is of follo&in% typeG C=nAenien%e Sa !ling 6 %=nAenien%e sa !le chooses the individuals that are easiest to reach or samplin% that is done easy. 'onvenience samplin% does not represent the entire population so it is considered !ias. <u=ta Sa !ling n :uota samplin% the selection of the sample is made !y the intervie&er( &ho has !een %iven :uotas to fill from specified su!)%roups of the population. -udg ent Sa !ling The samplin% techni:ue used here in pro!a!ility S =andom Samplin%. The total sample size is .// profiles. Data C=lle%ti=n G ) Eata is collected from various customers throu%h personal interaction. Specific :uestionnaire is prepared for colletin% data. Eata is collected &ith mere interaction and formal discussion &ith different respondents and &e collect data in 4E4SI F CO#E and face to face contact &ith the persons from &hom the information is to !e o!tained Akno&n as informantsB. The intervie&er asks them :uestions pertainin% to the survey and collects the desired information. Thus( the &e collect data
42

a!out the &orkin% conditions of the &orkers of 4E4SI F CO#E4 &e &orked at 4E4SI F CO#E contact the &orkers and o!tain the information. The information o!tained are first hand or ori%inal in character.

5/

CO#E COMES TO I+DI)


'oca)'ola come to ndia &ith fanfare in the fifties. <or a num!er of days( The ;industan Times and other ne&spapers of -e& Corakhpur carried full pa%e advertisement sho&in% a !i% !oy in uniform &ith a soft)drink cro&n as the cap. There &as no indication of the product. 6fter a fe& days( 'oke &as introduced. t &as an entirely ne& drink &hich fascinated people. t soon !ecame the national drink. <or the first time( a soft)drink &as availa!le from one corner of the country to another. The person &ho !rou%ht 'oca)'ola to ndia &as the father of late Sardar 'haran#it Sin%h( Sardar 1ohan Sin%h. 6 practical man 1ohan Sin%h realised that to popularise 'oca)'ola( and make it a !est seller it &as necessary to Fcatch them youn%.K So he focused on youn%sters in the society. The company realised that to !ecome a mass consumption product( one has to %o to the villa%e. They %ave much importance to the distri!utive net&ork. The company trucks supplied coke to even the remotest villa%e. <e& products appears to !e more similar than soft drinks( yet the 'ola &ars that mark the competition !et&een 'oke and Pepsi sho& ho& even or%anizations &ith hi%hly similar product can !e differentiated !y their !usiness strate%ies. Then came !attles over the issue of !ottle size standardization. 'oke the arch rival tried to offerin% more 'ola at a lo&er price. Pepsi &hich had some of its early investment tied up in 25/ml !ottles( &ent the fountain &ay. The Ceneral !ottle size freed has settled at 3// ml. ( .// ml more than the pre 1-' standard. <ountain mi$ dispensers( carry home !ottles( even ..5/ plastic !ottle &ith caps %ood enou%h to keep them lyin% do&n and still preserve the fizz.

5.

t poured in vast sums to &hip up its visi!ility at the retail level( so that consumers &ere %reeted virtually at every street corner !y Pepsi*s !lue( red and &hite colors( !ecause they have perception Fthe thin% on display sells more.K. 'oca)'ola is( finally( redoin% the real thin% to the replicate the success that its arch)rival( Pepsi'o.( has achieved &ith its fast and furious marketin%. ?ut to &in them( 'oke is copyin% Pepsi .

52

M)(#ETI+G ST)TEGIES O$ CO#E

a)

4(ODUCT
'oke &as launched in ndia in 6%ra( ,cto!er 24( in N23N( soon after its

traditional all ndian launch of its 'ola. at the sparkin% ne& !ottlin% plants at ;athra( near 6%ra. 'oke &as !ack &ith a !an% after its e$it in .2"". 'oke &as plannin% to launch in ne$t summer the oran%e drink( <anta) &ith the clear lemon drink( sprite( follo&in% later in the year.

'oke already o&ns more !rands than it &ill over need( since it has !ou%ht out =amesh 'hauhan. 'oke #ust needs to #u%%le these !rands around de$trously to meet its o!#ectives( to ensure that Pepsi does not %ain market share in t Today( 'okeNs product line includes( 'oca)'ola( Thums 7p( <anta( Cold Spot( 1aaza( 'itra( Sprite( ?isleri 'lu! Soda and Eiet 'oke.

4)C#)GI+G
'oca)'ola ndia @imited A'' @B has !ottled its 'ola drink in different sizes and different packa%in% i.e.( 2// ml !ottle( 3// ml. ?ottle( 33/ ml. 'ans( 5// ml. ?ottle fountain Pepsi( and !ottles of . and 2 ltr.

4(ODUCT 4OSITIO+I+G
,ne important thin% must !e noticed that Thums 7p is a stron% !rand in &estern and southern ndia( &hile 'oca 'ola is stron% in -orthern and Eastern ndia. +ith volumes of Thums 7p !ein% lo& in the capital( there are
53

likely chances of 'oca 'ola slashin% the prices of Thums 7p to =s. 5 and continue to sell 'oca 'ola at &hich has #ust one. Thums 7p accounts for 4/I of 'oca 'ola companyNs turn over( follo&ed !y 'oca 'ola &hich has a 23I share and @imca &hich accounts for ."I of the turn over of the company. AThums up !ein% the local drink( its share in the market is intact( forcin% the company to service the !rand( as it did last year 1r. Eonald short 'E,( 'oca 'ola ndia( said that( M &e &ill !e a!solutely comforta!le if Thums 7p is -o. . !rand for us in ndia in the year 2///. +e &ill sell &hatever consumers &ants us toM. 'oca 'ola ndia has positioned Thums up as a !evera%e associated &ith adventure !ecause of its stron% taste and also makin% it compete &ith Pepsi as even Pepsi is associated &ith adventure( youth. the same rate. 6nalysts feel that this strate%y may help 'oke since it has 2 'ola !rands in comparison to Pepsi

b)

4(ICE
The price !ein% fi$ed !y industry( leavin% very little role for the

players to play in the settin% of the price( in turn makin% it difficult for competitors to compete on the !asis of price. The fi$ed cost structure in 'ar!onated Soft Erinks ndustry( and the intense competition make it very difficult to chan%e or alter the prices. The various costs incurred !y the individual companyNs are almost unavoida!le. These !ein% the costs of concentrates( standard !ottlin% operations( distri!utor and !ottlers commissions( distri!ution e$penses and the promotional and advertisin% e$penditure A6s far as 'oke is concerned( it had

54

to incur a little more than Pepsi as Pepsi paved its &ay to ndia in .202 &hile 'oke made a come !ack in .223.B 'urrently a 3// ml. 'oke !ottle is availa!le for =s. 6 to0 The 33/ can &as initially availa!le for =s. .3 and no&( since the price has %ave up to =s. .0 per can. The prices of 5// ml.( . ltr. and 2ltr !ein% =s. .5 =s. 23 and =s. 4/ respectivelyA accordin% to the current surveyB. Eatin% !ack to T23N( &hen Pepsi hiked the price of Pepsi ) 'ola from =s. 5 to =s. 6 per 25/ ml. !ottle in some parts of the country)includin% 6%ra. 'oke penetrated the market &ith price of =s. 5 for a 3// ml. !ottle( makin% it cheaper !y =s. . and 5/ ml. than Pepsi. 'okeNs strate%y at that time !ein% a!le to e$pand the availa!ility of soft drinks even in rural ndia. 'okeNs priority !ein% to first increase the num!er of drinks per drinker( and then the num!er of drinkers itself. Pepsi also tried this !ut &as trapped !y a series of competitive price increase and chan%es in !ottle sizes !y Parle. ?ut the prices of soft drinks have shot up since PepsiNs arrival and the current prices are !ein% mentioned as under.

4ri%e list
+a e 'oke Per ?ottle 'oke 'oke 'oke B=ttle SiBe 2// ml 3// ml M(4 (in (s.) 6 0

5// ml APlastic 3 ClassB .5 2 litre 35

55

Eiet 'oke A'anB 'oke A'anB

33/ ml 'an 33/ ml 'an

.0 .0

;o&ever( the trends may have !een in the early N2/Ns( no& the prices of Pepsi and 'oke are the same makin% it difficult in future and present to compete on the !asis of price.

%)

45)CE
'oke may have %ained an early advanta%e over Pepsi since it took

over Parle in .224. ;ence( it had ready access to over 2(//(/// retailer outlets and 6/ !ottlers. 'oke &as had a !etter distri!ution net&ork( o&in% to the &ide net&ork of Parle drinks all over ndia. e$panded its distri!ution net&ork. 'oke and its product &ere availa!le in over 2(5/(/// outlets Ain contrast &ith PepsiNs 2(//(///B. 'oke has a %reater advanta%e in terms of %eo%raphical covera%e. ?ut 'oke has had pro!lems &ith its !ottlers as the re:uired profits for the !ottlers have not !een forthcomin%. This is more so !ecause 'oke has hiked the price of its concentrate !y =s. 0 <urther( 'okeNs operations in ndia are .//I <,?,s. -o&( it plans to convert then into ',?,s. This is strainin% the relationship !et&een the 'oke and its !ottlers. The company had decided to create a fund to reim!urse performin% !ottlers for the e$tra costs incurred on account of the hike in prices of soft drink concentrates. 1r. Short also realized that ndia is a price sensitive market
56

'oke has further

and the company &ould have to a!sor! in the increase in e$cise duty and said that in the lon% run 'oke &ill have to slash prices for the !enefit of the consumers and said that they &ere considerin% a cut in the prices of their fountain soft drinks. 'oke and Pepsi have devised strate%ies to %et rid of middlemen in the distri!ution net&ork. ;o&ever( 5/I of the industry unfortunately depends on these middlemen. 6s of no&( around .// a%ents are present in Corakhpur. ?ottlers of the 2 multinationals have stron%ly felt the need to remove these middlemen from the distri!ution system( !ut very little success has !een achieved in doin% so.

d)4(OMOTIO+
t must !e remem!ered that soft drinks purchases are an Mimpulse !uy lo& involvement productsM &hich makes promotion and advertisin% an important marketin% tool. The 2 arch rivals have spent a lot on advertisin% and on promotional activities. To promote a !rand and even to spend a lot on advertisin%( the company must !e a&are of the perceived :uality of the !rand( its !rand po&er Aif at all there isB since consumers make purchase decision !ased on their perceptions of value i.e.( of :uality relative to price. 6ccordin% to Paul Sto!art( 6dvertisin% encoura%es customers to reco%nize the :uality the company offers. Price promotions often produce short)term sales increases. 'oca 'ola has entered ne& markets and also developin% market economics Alike ndiaB &ith much)needed #o!s.
5"

'oke attri!utes its success to !ottlers( the 'oca 'ola system itself( i.e.( its e$ecutive committees( employees( ?,E( company presidents !ut a!ove all from the consumer. 'okeNs red color catches attention easily and also the Eiet 'oke &hich it introduced &as takin% the 'ake( as Pepsi has not come out &ith this in ndia. Ever since 'okeNs entry in ndia in .223( 'oke made a come !ack Aafter :uittin% in .2""B( in ,cto!er 24 in 6%ra( the city &as flooded !y trucks( there &heelers( tricycle cards)all &ith hu%e red 'oke)em!lazoned um!rellas. =etailers &ere displayin% their 'oke !ottles in distinctive racks( also &ith specially)desi%ned ice!o$es to keep 'oke !ottles cold. This &as one !i% #olt to Pepsi.

ST()TEGIES )DO4TED BY COC# )+D 4E4SI

50

The 4e!si 4r=%ess: Eespite !ein% a %lo!al !rand( Pepsi has !uilt its success on

meetin% the ndian consumer*s needs( particularly in terms of makin% the !rand synchronize &ith localized events and traditions. nstead of harpin% on its %lo!al linea%e( er%o( it tries to plu% into ethnic festivals( use the vernacular indifferent part of the country( and !lend into the local fa!ric. Pepsi is usin% !oth national campai%ns)such as the Erink Pepsi( Cet Stuff scheme( &hich offers lar%e discounts on other products to Pepsi)!uyers as &ell as local .
The C="e C=!&: nstead of creatin% a !ond &ith the customers throu%h small

!ut hi%h)impact events( 'oca)'ola chose to associate itself &ith national and international me%a events like the +orld 'up 'ricket( .226( and &orld cup foot!all .220. ?ut no& coke is also enterin% into local actions. 'oke is also tryin% to make their !rand synchronize &ith localized events traditions and festivals. 'oca)'ola ne& ta% line in this advertisement is F=eal shoppin%( =eal refresherK. n this &ay 'oke is copy Pepsi.

52

EM4O9E(ME+T
The 4e!si 4r=%ess: ,nce of the stron%est &eapons in Pepsi*s armory is the

fle$i!ility it has empo&ered its people &ith. Every mana%er and salesperson has the authority to take &hatever steps he( or she( feels &ill make consumers a&are of the !rand and increase its consumption.
The C="e C=!&G <le$i!ility is the &eapon that 'oca)'ola( fettered as it is !y

the need for approvals from 6tlanta for almost everythin%. n the past( this has sho&n up in its stu!!orn insistence on #unkin% the franchisee net&ork it had ac:uired from Parle4 in its dependence on its o&n feed!ack mechanism over that of its !ottlers4* and on its head:uarters)led approach.
4(ICE The 4e!si !r=%ess: Pepsi has consistently &ielded its pricin% strate%y as in

invitation to sample( aimin% to turn trial into addiction. t launched the 5// ml !ottle in .224 at =s. 0 versus Thums 7p*s =s. 2( in 6pril( .226( its ..5 litre !ottle follo&ed 'oke into the marketplace at =s. 3/ 9 =s 5 less than 'oke*s .?ut it couldn*t continue the lo&er price positionin% for lon%.
The C="e C=!&: nitially( coke car!on)copied the strate%y !y introducin% its

33/ml cans in Danuary .226( at an invitation price of =s. .5 !efore raisin% it to =s. .0. ?y this time( it had realised that the 'oca)'ola !rand did not hold enou%h attraction for customers to fork out a premium. The 2//ml 'oke( launched so far in parts of eastern( &estern( and northern ndia( is priced at =s. 5( lo&erin% the entry)!arriers. To really drive the market( as 'oke &ants to you must %o do&n to =s. 3*.

6/

4E4SI .S. CO#E

H20 ? @@ ,32I Q =S. 5,, '=,=ES =S. 3// '=,=ES 24// .3 .0 4/// -.6. 6

TU(+O.E( I+T. S)5ES )S K O$ TOT)5 S)5ES TOT)5 I+.ESTME+T I+ I+DI) 4(O4OSED I+.ESTME+TS +O. O$ EM45OYEES

H.6 ? @@ ,"/I =S. 25/ ' =S. 2(4//' .4/ -@ 53 .5// =s .25 '= -.6.

+O. O$ O9+ED BOTT5I+G 45)+TS +O. O$ $()+C/ISES +O. O$ $OU+T)I+ TOT)5 I+.ESTME+T BY BOTT5E(S +E9 45)+TS 45)++ED

6.

4E4SI )+D CO#E M)(#ET S/)(E I+ I+DI)

62

CO5) : 6;K C5E)( 5EMO+ : 2K Pepsi G 26.5 ")7P G 2.5I Thums)up G .".5I 'itra G /.5I 'oke G./I O()+GE : ,6K OT/E(S : 8K 1irinda G ".5I ,ther ?rands G .6.5I <anta G 6I Cold Spot G .I 'rush G .I C5OUDY 5EMO+ : ,0K @imca G 2I 1irinda lemon U Euke*s G ..5I Sch&eppes lemon G /.5I

63

The C=la 9ars


O.E( ) CE+TU(Y O$ CO5) S5OG)+S' COMME(CI)5S' B5U+DE(S' )+D COU4S
ThereNs little dou!t that the most spirited and intense competition in the !evera%e &orld is !et&een 'oca)'ola and Pepsi. These t&o 6merican companies lon% a%o took their !attle &orld&ide( and althou%h there are other colas in the market( these %iants occupy this hi%h)stakes arena !y themselves. The impact of 'oke and Pepsi on popular culture is indisputa!le( and have o!served in my time mana%in% this &e! site that 6merica has not !ecome #aded a!out the cola &ars. The memora!ilia( the #in%les( the trivia ) all still popular. So am offerin% this pa%e in an attempt to assua%e a &ee !it of the 'oke and Pepsi thirst that is thrivin% on our planet.

IT )55 ST)(TED . . . .
'oca)'ola &as invented and first marketed in .006( follo&ed !y Pepsi in .020. 'oca)'ola &as named after the coca leaves and kola nuts Dohn Pem!erton used to make it( and Pepsi after the !eneficial effects its creator( 'ale! ?radham( claimed it had on dyspepsia. <or many years( 'oca)'ola had the cola market cornered. Pepsi &as a distant( nonthreatenin% contender. ?ut as the market %ot more and more lucrative( professional advertisin%

64

!ecame more and more important. These soda companies have !een leadin% the &ay in advertisin% ever since.

)D.E(TISI+G /ISTO(Y F COMME(CI)5S


Pepsi has definitely leaned to&ards the appeal of cele!rities( popular music( and youn% people in television commercials( &hile 'oke relies more heavily on ima%es of happiness and to%etherness( tradition( and nationalism( perpetually tryin% to cash in on its ori%inal lead. n a simplified sense( you could sum up the strate%ies as Coke: ld, Pepsi: !ew. n fact( as &e &ill see( &hen 'oca)'ola tried somethin% new( it &as disaster. The first ma%azine ad for 'oca)'ola appeared in "unsey#s in .2/2. 6dvertisements !e%an to appear on !ill!oards( ne&spapers( and streetcars. Soon there &ere servin% trays &ith ima%es of people en#oyin% 'oca)'ola( and %lasses &ith the colaNs name on them. 6t this time( 'oca)'ola and Pepsi &ere served in dru%store soda fountains. n .2/2( Pepsi used its first cele!rity endorser( automo!ile race driver ?arney ,ldfield( in ne&spaper ads. n .22.( Pepsi &ent !ankrupt( !ut continued to appear on the scene( althou%h not nearly so successfully as 'oca)'ola. n .23.( Pepsi &ent !ankrupt a%ain( !ut the ne& o&ner( =oy 1e%ar%el( &ould hit upon an idea that &ould finally %ive 'oca)'ola some competition. n .234( he marketed Pepsi in a .2)ounce !ottle for a nickle. 6t the time( 'oca)'ola &as sold in a 6)ounce !ottle for ten cents. JoilaO Profits for Pepsi.

65

Pepsi racked up another first !y airin% the first radio #in%le in .232. t &as so popular that it &as played in #uke!o$es and !ecame a hit record'oca)'ola hit the air&aves in .24.. n .246( inflation forced Pepsi to increase prices. 6nd in .25/( Pepsi offered a lar%er 26)ounce !ottle to court the youn% 6merican house&ife. n the .26/Ns( the cola ad &ars moved to television. 'oca)'ola employed a host of cele!rity sin%ers to promote the product( includin% C=nnie $ran%is ' T= -=nes' The +ew Beats' +an%& Sinatra' and The Su!re es. 6s &e moved throu%h the years( !oth colas incorporated some of their !est slo%ans AMPepsi CenerationM and Mthe =eal Thin%MB into su!se:uent commercials. n the .2"/s( market research sho&ed that consumers preferred the taste of Pepsi over 'oke. The Pepsi 'hallen%e is still !ein% conducted today. ?ut 'oke came up &ith &hat is ar%ua!ly the !est of all cola commercials( the ,:7, IGd 5i"e t= Bu& the 9=rld a C="e ad. This landmark &as recalled in 'hristmas versions in .203 and ,:82( and a ,::; Su!er B=wl ad( &hich &as enou%h to make some ?a!y ?oomers &eep &ith nostal%ia. n the .20/Ns( Pepsi lined up the cele!rities( startin% &ith Mi%hael -a%"s=n( then 1adonna( 1ichael D. <o$( ?illy 'rystal( @ionel =itchie( Cloria Estefan( Doe 1ontana( and others. 'oke si%ned on 1ichael Dordan( -e& 8ids on the ?lock( )retha $ran"lin( Elton Dohn( and Paula 6!dul. n .205( respondin% to the pressure of the Pepsi 'hallen%e taste tests( &hich Pepsi al&ays &on( 'oca)'ola decided to chan%e its formula. Bill C=sb& &as the pitchman. This move set off a shock &ave across 6merica. 'onsumers an%rily demanded that the old formula !e returned( and 'oca)'ola
66

responded three months later &ith Classic Coke. Eventually( -e& 'oke :uietly disappeared. Pepsi( mean&hile( had its o&n flop( 'rystal Pepsi( &hich &as supposed to catch the stran%e &ave of the times &hen everythin% colorless &as clean and desira!le ALima( !ottled &aterB. 6nd then there &as 4e!si 5ite &ith the lemony flavor and one calorie( introduced in .2"5. =emem!er that oneV 6pparently they didnNt e$pect us to !ecause later they %ave us Pepsi ,ne( usin% the same concept( !ut a completely different taste. 6nd( e$tendin% the idea even further( &e are no& %ettin% Pepsi T&ist( a ne& product &ith a t&ist of lemon flavor. n .22.( (a& Charles san%( M5ou %ot the ri%ht one !a!y( uh)huhOM 6lso in the .22/s( 'indy 'ra&ford and the S!i%e Girls pitched Pepsi. 6nd then Pepsi aired commercials featurin% the aggraAating little girl (/allie Eisenberg) with her tr=ubling ale A=i%e.

n the ne& century( !oth colas continue to !attle it out on the television screen. 6nd cele!rities continue to !e important promoters. =ecently( Pepsi has had commercials !y B=b D=le and $aith /ill' amon% others.

.
6"

S5OG)+S
tNs clear in lookin% at the slo%ans over the years that 'oke and Pepsi have very different tar%etin% strate%ies. 'oke is toutin% itself as the ori%inal( the authentic( and appealin% to a sense of tradition( positionin% itself as an inte%ral part of daily 6merican life. Pepsi( on the other hand( is promotin% itself as somethin% ne&( youn%( and hip( &hich seems a little odd after over .// years. ?ut 'oke &as first( after all. Pepsi has al&ays tar%eted the youth market more a%%ressively than 'oke.

COC)DCO5)
,886 D Drin" C=%aDC=la ,:;2 D C=%aDC=la Satis>ies ,:;2 D Deli%i=us and (e>reshing ,:;3 D C=%aDC=la (eAiAes and Sustains ,:;3 D G==d )ll the 9a& D=wn ,:;6 D The Drin" => <ualit& ,:;6 D The Great +ati=nal Te !eran%e ,:;7 D Deli%i=us C=%aDC=la' Sustains' (e>reshes' InAig=rates ,:;7 D C==ling . . . (e>reshing . . . Deli%i=us ,:;8 D S!ar"ling D /ar less as 9ater' and Cris! as $r=st ,:;: D Deli%i=us' 9h=les= e' (e>reshing ,:,; D It Satis>ies ,:,; D <uen%hes Thirst as +=thing Else Can ,:,, D ItGs Ti e t= Drin" C=%aDC=la ,:,, D (eal Satis>a%ti=n in EAer& Glass ,:,0 D De and the Genuine D (e>use Substitutes
60

,:,* D The Best BeAerage Under the Sun ,:,* D ) 9el%= e )dditi=n t= )n& 4art& D )n&ti e D )n&where ,:,2 D EEhilarating' (e>reshing ,:,2 D De and the Genuine b& $ull +a e ,:,2 D 4ure and 9h=les= e ,:,6 D -ust One Glass 9ill Tell Y=u ,:,7 D Three Milli=n ) Da& ,:,: D <ualit& Tells the Di>>eren%e ,:0; D Drin" C=%aDC=la with S=da ,:00 D Thirst #n=ws += Seas=n ,:00 D Thirst CanGt Be Denied ,:00 D Thirst (e inds Y=u D Drin" C=%aDC=la ,:0* D (e>resh Y=ursel> ,:02 D 4ause and (e>resh Y=ursel> ,:03 D SiE Milli=n ) Da& ,:03 D The S=%iable Drin" ,:06 D St=! at the (ed Sign ,:07 D )r=und the C=rner >r= ,:0: D The 4ause that (e>reshes ,:*; D Meet Me )t the S=da $=untain ,:*0 D I%eDC=ld Sunshine ,:** D D=nGt 9ear a Tired' Thirst& $a%e ,:*2 D Carr& a S ile Ba%" t= 9=r" ,:*3 D )ll Trails 5ead t= I%eDC=ld C=%aDC=la ,:*6 D 9hat (e>resh ent Ought t= Be ,:*6 D The (e>reshing Thing t= D=
62

)n&where

,:08 D ) 4ure Drin" => +atural $laA=rs

,:*7 D ) eri%aGs $aA=rite M= ent ,:*7 D S= Eas& t= SerAe and S= IneE!ensiAe ,:*8 D The Best $riend Thirst EAer /ad ,:*8 D 4ure Sunlight ,:*8 D )n&ti e is the (ight Ti e t= 4ause and (e>resh ,:*: D C=%aDC=la G=es )l=ng ,:*: D Ma"e 5un%h Ti e (e>resh ent Ti e ,:*: D Ma"es TraAel M=re 4leasant ,:*: D The Drin" EAer&b=d& #n=ws ,:*: D Thirst St=!s /ere ,:2; D Bring in Y=ur Thirst and G= )wa& 9ith=ut It ,:2, D C= !letel& (e>reshing ,:20 D (e>resh ent That CanGt Be Du!li%ated ,:20 D 9h=eAer Y=u )re' 9hateAer Y=u D=' 9hereAer Y=u Ma& Be' 9hen Y=u Thin" => (e>resh ent' Thin" => I%eDC=ld C=%aDC=la. ,:2* D The Onl& Thing 5i"e C=%aDC=la is C=%aDC=la Itsel>. ItGs the (eal Thing ,:2* D ) Taste )ll Its Own ,:2* D That EEtra S= ething ,:22 D /=w )b=ut a C="e ,:23 D 4ass!=rt t= (e>resh ent ,:23 D 9heneAer Y=u /ear L/aAe a C="e'L Y=u /ear the .=i%e => ) eri%a ,:27 D C="e #n=ws += Seas=n ,:27 D SerAing C=%aDC=la SerAes /=s!italit& ,:28 D 9here ThereGs C="e' ThereGs /=s!italit& ,:2: D C=%aDC=la . . . )l=ng the /ighwa& t= )n&where
"/

,:3; D /el! Y=ursel> t= (e>resh ent ,:3, D G==d $==d and C=%aDC=la -ust +aturall& G= T=gether ,:30 D 9hat Y=u 9ant Is a C="e ,:3* D De!endable as Sunrise ,:32 D $=r 4e=!le =n the G= ,:33 D ) eri%aGs 4re>erred Taste ,:36 D C=%aDC=la D Ma"ing G==d Things Taste Better ,:36 D $eel the Di>>eren%e ,:37 D Sign => a G==d Taste ,:38 D The C=ld' Cris! Taste => C="e ,:3: D Be (eall& (e>reshed ,:6; D (elaE 9ith C="e ,:6, D C="e and $==d D (e>reshing +ew $eeling ,:60 D C=%aDC=la (e>reshes Y=u Best ,:6* D Things G= Better 9ith C="e ,:63 D S= ething M=re Than a S=>t Drin" ,:66 D C="e . . . )>ter C="e . . . )>ter C="e ,:7; D ItGs the (eal Thing ,:7, D IGd 5i"e t= Bu& the 9=rld a C="e ,:72 D 5==" U!' ) eri%a ,:76 D C="e )dds 5i>e ,:7: D /aAe a C="e and a S ile ,:80 D C="e Is ItM ,:82 D -ust $=r the Taste => It (Diet C="e) ,:83 D -ust $=r the $ree => It (Ca>>eine $ree C="e) ,:83 D 9eGAe G=t a Taste $=r Y=u (+ew C="e) ,:83 D ) eri%aGs (eal Ch=i%e (C=%aDC=la Classi%) ,:86 D Cat%h the 9aAe (+ew C="e)
".

,:86 D (ed' 9hite and Y=u (C=%aDC=la Classi%) ,:87 D Y=u CanGt Beat the (eal Thing ,:8: D CanGt Beat the $eeling ,::; D CanGt Beat the (eal Thing ,::* D )lwa&s C=%aDC=la ,::* D Taste it )ll

4E4SIDCO5)
,:;* D EEhilarating' InAig=rating' )ids Digesti=n ,:;7 D Original 4ure $==d Drin" ,:;: D Deli%i=us and /ealth>ul ,:,3 D $=r )ll Thirsts D 4e!siDC=la ,:,: D 4e!siDC=la D It Ma"es Y=u S%intillate ,:0; D Drin" 4e!si C=la. It will satis>& &=u. ,:08 D 4e!s Y=u U!M ,:*0 D S!ar"ling' Deli%i=us ,:*2 D (e>reshing and /ealth>ul ,:*: D Twi%e )s Mu%h $=r ) +i%"el T== ,:2* D Bigger Drin"' Better Taste ,:2: D 9h& ta"e less when 4e!siGs bestH ,:3; D M=re B=un%e t= the Oun%e ,:3; D The 5ight (e>resh ent ,:32 D (e>reshing 9ith=ut $illing ,:38 D Be S=%iable' haAe a 4e!si ,:6, D +=w ItGs 4e!si' $=r Th=se 9h= Thin" Y=ung

"2

,:6* D C= e )liAeM Y=uGre In the 4e!si Generati=n ,:67 D Taste That Beats the Others C=ld ,:67 D 4e!si 4=urs It On ,:6: D Y=uGAe G=t a 5=t t= 5iAe and 4e!siGs G=t a 5=t t= GiAe ,:7* D -=in the 4e!si 4e=!le $eelinG $ree ,:73 D /aAe a 4e!si Da& ,:78 D Cat%h That 4e!si S!irit ,:8, D 4e!siGs G=t Y=ur Taste $=r 5i>eM ,:8* D 4e!si +=wM ,:82 D 4e!si' the Ch=i%e => a +ew Generati=n ,::0 D G=tta /aAe It ,::* D Be Y=ung' /aAe $un' Drin" 4e!si ,::3 D +=thing else is a 4e!si ,::: D The -=& => C=la

"3

'E@ ?= T ES P@65 -C P6=T - T, T;E S6@ES P=,1,T ,- ,< T;E P=,E7'TG

'E@ ?= T ES ,< PEPS G 61 T6?; ?6';;6 S;6;=78; 8;6 P=EET5 L -T6 S6'; - TE-E7@86= S6 < 6@ 8;6 S67=6J C6-C7@5 =6;7@ E=6J E 1,;E. 86 < L6;EE= 8;6 ;6=?;6D6- S -C; 57J=6D S -C; 'E@ ?= T ES ,< ',8EG S6@16- 8;6 6 S;+6=56 =6 61 = 8;6 J JE8 ,?E=, ? P6S;6 ?6S7 68S;65 8716=

"4

CO#) CO5)' 4E4SI I+ C)5O(IE B)TT5E


)r%h riAals !lan salA=s => new diet %=las' 4e!si O+E and C=%aDC=la Ner=. 1arch 22( 2//5G +E9 YO(# (C++JM=ne&) D The beAerage aisle is ab=ut t= get %r=wded as 4e!si and C=%aDC=la debut new diet %=las. 'oca)'ola is addin% a fourth diet cola to its line this Dune &ith 'oca)'ola Lero( &ith no calories( the company announced Tuesday. 6nd this sprin% Pepsi is relaunchin% its one)calorie Pepsi ,-E &ith Splenda s&eetener rather than aspartame. =eformulated Pepsi ,ne( availa!le on shelves and coolers in late 1arch( is part of PepsiNs focus on diet soft drinks this year( said 8atie @acey( Pepsi) 'ola -orth 6mericaNs vice president of car!onated !evera%es( in a statement =re

+hile for 'oke( M'oca)'ola Lero is e$actly &hat youn% adults told us they &anted(M said Ean Eillon( vice president( Eiet Portfolio( 'oca)'ola -orth 6merica( in a statement. 6pparently 6mericaNs youth &anted a cola s&eetened &ith su%ar su!saspartame and acesulfame potassium. The ne& cola &ill not replace Eiet

"5

'oke( favored !y a different %roup of cola s&i%%ers( accordin% to the company. ?oth PepsiNs Aup H/./0 to H52.64( =esearchB and 'okeNs Aup H/./6 to H4..66( =esearchB ne& diet !re&s are aimed youn% adults( mostly male( accordin% to 6da%e.com. 6pparently( more men are %ulpin% reduced)calorie and zero) calorie !evera%es to stay trim( the article says. 6lon% &ith Eiet 'oke and the ne& Lero( 'okeNs diet selection includes a Splenda)s&eetened Eiet 'oke( Eiet 'oke &ith lime and '2( launched last year. <or the curious( 'oca)'ola Lero &ill auction off a sample pack of the cola on e?ay in 6pril.

C="e As. 4e!si: the new %=la wars


+E9 YO(# (C++JM=ne&) D The Beatles =r the Ba%"street B=&sH Star Tre" =r Star 9arsH Yan"ees =r MetsH The& sa& &=u ust li"e either =ne =r the =ther.

Shares of C=%aDC=la A#O: (esear%h' Esti atesB and 4e!siC= (4E4: (esear%h' Esti atesB have !een on a tear this year( &ith each postin% solid %ains in an other&ise dismal market. 'oke has sur%ed 2/.3 percent year to date &hile Pepsi is up ".2 percent. The t&o currently are tradin% #ust a hair off their 52)&eek hi%hs.

"6

?ut some analysts and fund mana%ers think the trendier Pepsi has more fizz left in its stock than 'oke. 'oca)'ola is launchin% a ne& product( .anilla C="e( ne$t &eek A1ay .5B &hile Pepsi recently announced that it &ill start sellin% a !erry flavored cola( 4e!si Blue( in 6u%ust. +ith Janilla 'oke( the company seems to !e !ankin% on nostal%ia. ADohn TravoltaNs character in MPulp <ictionM ordered a Janilla 'oke at a 5/Ns themed diner( for e$ample.B Pepsi ?lue( on the other hand( seems to !e a concerted attempt to reach out to the hipper( youn%er demo%raphic that drinks PepsiNs 1ountain Ee&. 6nd em!racin% that demo%raphic has &orked. The launch of 'ode =ed( a cherry) flavored version of 1ountain Ee&( last year helped Pepsi increase its market share. 6ccordin% to the ?evera%e 1arket 'orporation( unit volume for all of PepsiNs soda !rands Aincludin% Eiet Pepsi and 1ountain Ee& for e$ampleB increased ..3 percent in 2//. &hile volume for 'okeNs car!onated !evera%e !rands AEiet 'oke( 'herry 'oke and Sprite amon% othersB declined !y .2 percent. MThis is a mistake for 'oke. Pepsi is %oin% after the ri%ht market. 5oun%er audiences are %oin% to !uy more of Pepsi ?lue. donNt see any ed%e in vanilla(M says Ted Parrish( co)mana%er of the /enssler E?uit& $und. 6s of 6pril 3/( Pepsi &as the fundNs second)lar%est holdin%. The fund does not o&n 'oke.

""

B)TT5E O$ T/E BE.E()GES:

"0

4E4SI IS +OT )S 4(ICEY


=e%ardless of &hich soda you like !etter thou%h( Pepsi seems the !etter value than 'oke ri%ht no&. 'oke is tradin% at a nearly 2/ percent premium to Pepsi !ased on 2//2 P3Es even thou%h the t&o companiesN earnin%s %ro&th rates are nearly identical. APepsiNs are actually a shade hi%her.B 6nd &hen you look at revenues( the %ap is even more dramatic. 'oke is tradin% at " times estimated 2//2 sales &hile Pepsi is tradin% at 3.5 times 2//2 revenue estimates. ?oth companies are e$pected to post sli%ht declines in sales this year and an increase of a!out 4 percent in 2//3. Eue to this disparity in valuation( Deff 8anter( an analyst &ith Prudential Securities( says he has a M!uyN ratin% on Pepsi and MholdM on 'oke. Prudential does not do investment !ankin%. To !e sure( 'oke is still the market share leader in soft drinks. ,ne of the main reasons the stock has outperformed Pepsi this year &as !ecause it reported a !etter than e$pected %ain in unit volume in the first :uarter. 6nd the company has taken steps to cement its car!onated !evera%e lead as &ell %ain %round in the !ottled &ater market. A'oke and Pepsi !oth have their o&n !rands of &ater( Easani and 6:uafina( respectively.B ,n Tuesday( 'oke announced that it &as ac:uirin% the Sea%ramNs line of mi$ers( tonic( %in%er ale and seltzer from Eia%eo and Pernod =icard. 6nd last month( 'oke entered into an a%reement &ith Croup Eanone to distri!ute Evian !ottled &ater in -orth 6merica.

"2

S= e !retBels with that s=daH

?ut &hile 'oke relies solely on !evera%es for %ro&th( another factor in PepsiNs favor is its diversity. M+hat attracts me to Pepsi is have more faith in their a!ility to %ro& earnin%s. -ot only are they successful on the !evera%e side !ut they are successful &ith salty snack foods(M says 'rit Thomas( director of %ro&th e:uity for -ational 'ity nvestment 1ana%ement 'o.( the su!advisor for 6rmada <unds. 6s of 1arch 3.( Pepsi &as the seventh)lar%est holdin% in the )r ada TaE Managed E?uit& $und and the tenth)lar%est holdin% in the )r ada E?uit& Gr=wth $und. n fact( PepsiNs car!onated !evera%es are not even the !i%%est %enerator of sales and earnin%s for the company. PepsiNs <rito)@ay !rand of snack foods( &hich include <ritos( Eoritos and =old Cold( accounted for 6..2 percent of revenue and 65.3 percent of operatin% profits in the first :uarter. PepsiNs soft drink !usiness made up .2 percent of sales and 23.2 percent of operatin% profit. Pepsi also o&ns Catorade and Ruaker <oods( havin% ac:uired Ruaker ,ats last year. ,ne potential risk for !oth Pepsi and 'oke is the economy. -o( not if it %oes !ack into a recession. f the economy continues to improve( the stocks could fall victim to &hat is kno&n as sector rotation( the sellin% of defensive companies like food and !evera%es in order to !uy more economically sensitive companies in the financial services and technolo%y sectors. To that

0/

end( shares of Pepsi and 'oke fell sli%htly on +ednesday durin% the 'isco) induced market rally. Still( Thomas says si%ns that the dollar is startin% to &eaken compared to other currencies should prop up !oth stocks. ThatNs !ecause a &eaker dollar helps !oost the profits of international su!sidiaries( since profits made in a forei%n currency are converted !ack to dollars. The ma#ority of 'okeNs sales are from its international operations( &ith #ust 30 percent of revenue comin% from the 7.S. last year. Pepsi is not as !i% %lo!ally !ut currency fluctuations are still a factor( as international sales accounted for 22 percent of revenue in 2//..

M=re than @ust tw= s=da st=%"s


?ut if youNre not a fan of either Pepsi or 'oke( there actually are several other !evera%e stocks out there. 6nd theyNre tradin% at lo&er valuations. Cadbur& S%hwe!!es (CSG: (esear%h' Esti atesB( the ?ritish confectioner( o&ns the Er Pepper( " 7p( 6>+ and =oyal 'ro&n !rands of soda. t too is #oinin% the ne& round of cola &ars( introducin% (ed $usi=n( a fruit flavored version of Er Pepper( <riday. =ed <usion &ill hit the market in Duly. 'ad!ury Sch&eppesN stock trades at a siza!le discount to 'oke and Pepsi( &ith a P3E of .6." !ased on 2//2 earnin%s estimates. Earnin%s are e$pected to increase .2.5 percent this year. C=tt (COTT: (esear%h' Esti atesB( the lar%est maker of private la!el sodas( trades at 26 times 2//2 earnin%s estimates !ut itNs %ro&th prospects for this year and ne$t are !etter than 'oke and Pepsi. 6nalysts e$pect 'ottNs earnin%s to increase 34.5 percent this year and 23 percent in 2//3.

0.

<inally( for you Shasta fans out there A&e kno& there are someB( there is +ati=nal BeAerage ($IN: (esear%h' Esti atesB( &hich o&ns Shasta and <ay%o( a !rand of car!onated !evera%es popular in the 1id&est. The stock is thinly traded and has no analyst covera%e( !ut for &hat itNs &orth it is tradin% at less than one times last yearNs sales.

02

4(ODUCT
The term soft drink &as ori%inated to distin%uish the flavored refreshment from hard li:uor. Soft drink &as flavored to chan%e the ha!its of earlier 6mericans &ho used to have hard li:uor. The fruits and ve%eta!le #uices are not considered soft drinks. Pepsi is a pure soft drink( &hich is en#oyed in our .25 countries. t is made of artificial flavors and contains no fruit #uice or fruit pulp.

/=w s=>t drin"s are

ade:

Soft drink consists of car!onated &ater and syrup. 6ddin% car!onated %as to &ater under pressure produces car!onated &ater. The %as makes the &ater !u!!le and fizz in most cases. Syrup is made of a concentrate and s&eetener. 6 concentrate is a !lend of flavor and acid. n concentrate for most soft drinks also include colorin%. The concentrate contains a uni:ue !lend of in%redients( &hich %ive Pepsi its distinctive flavor. Syrup can !e also !ein% prepared directly from individual in%redients. 'ar!on dio$ide %as %ives !evera%e its sparkle and tan%y taste and prevents spoila%e. +hile it has not !een conclusively proved that car!onation offers a direct medical !enefit( car!onated !evera%e are also used to alleviate post operative nausea &hen no other food can !e tolerated. 'ar!on dio$ide is supplied to soft drinks !y manufactures in a li:uid form maintained under appro$imately .(2// pounds per s:uare inch pressure in heavy steel containers. 1any of the flavorin%s found in soft drinks come from natural sources such as fruits #uices and oils o!tained from roots( citrus fruit peels( and leaves of various plants. Some flavorin% are artificial( !ut a similar to natural flavorin% in

03

taste. 'itric acid and phosphoric acid %ive soft drink a tart taste. 'aramel is usually used as a colorin% in cola drinks. The s&eeteners may come from maize( su%ar !eet or su%arcane. 6rtificial s&eetener( such as saccharine and aspartame is used in Eiet Pepsi and Eiet 'oke. The mi$in% is carried out under the hi%hest standards of :uality control and accordin%ly to precise instructions in order to insure that every consumer al&ays receives a product of the same trusted :uality. The !ottlin% of Pepsi in modern plants such as there are in ndia is carried out at the rate of 6// !ottles a minutes. Pepsi is approved !y the -ational ;ealth 6uthorities of every country in &hich it is sold.

4a%"aging
Pepsi is supplied in ) =eturna!le %lass !ottles A2// ml( 25/ ml( 3// ml( 5// ml( . &hich is supplied in molded plastic shells. ..5 litre PET !ottles( 33/ ml of cans( P1P machines A<ountain PepsiB <ountain Pepsi A< PB Eispenses soft Erinks in plastic cups. There are t&o methods of vendin% soft drinks. lt.B

,. 4reD iE s&ste

) n the premi$ system( the finished !evera%e is

prepared !y the soft drink manufacturers and filled into 5 to ./ %allon


04

stainless steel tanks. The tanks of the !evera%e are attached to the vendin% machine &here the !evera%e is cooled and dispensed.

0. 4=stD iE s&ste

) n post)mi$ system the vendin% machine has its

o&n &ater and car!on dio$ide supply. The &ater is supplied throu%h 6:ua Cuard purifier and is car!onated as re:uired !y car!on dio$ide cylinder. t is then mi$ed &ith concentrate or flavored syrup &hich is kept in ? ? A?a% in ?o$B as it is dispensed into the cup. Pepsi has post mi$ vendin% machines and coke has pre mi$ vendin% machines.

Cans F B=ttles ) 6mon% the different packa%es in the market in the ne$t
couple of years could !e cans and pet !ottles ) apart from the standard %lass !ottles. ,ne of the standard packa%es that one is likely to see in the comin% years is !uyin% more at lo&er price. Pepsi introduced 2// ml !ottles of Pepsi at the price of =s.6. t &as an instant hit &hile packa%es of those kinds are also !ein% &orked out keepin% in vie& of the rural market. ?ut it could also lead to the killin% of the standard 3// ml size !ottles that is in vo%ue no&. The consumer &ould %et a choice of soft drink at a cheaper and an afforda!le price ) even if it means !reakin% of certain standards shapes and sizes of the packa%es. The !road strate%ies of !oth penetratin% the market are still !ein% made. 6nd the amount of thou%ht that is %oin% into it can !e made out from the very fact that the manufacturers are thinkin% of such innovations as the Fpicnic packa%esK of the !rand for those on holiday trip. The !attle &ill !e en%rossin% as packa%es &ill !e !rou%ht to the market and !e pulled !y the competin% rivals. There &ould !e price &ars and competitions on :ualities.

05

n the 7S( 55I of the car!onated soft drink A'SEB is sold today in returna!le !ottles( 3/I on one)trip containers and .5I throu%h vendin% machines and fountain. n other parts of the &ould( Pepsi are sold mainly in returna!le !ottles. Pepsi in cans are more popular in countries such as 7S( 'anada( 6ustralia( Philippines and En%land. 'anned Pepsi is also sold in ndia.

06

Brands 9
The current ndian market consists of seven)flavor se%ment. 'ola se%ment is !y far the most &idely consumed soft drinks.

SEGME+T ',@6 ,=6-CE '@,7E5 @ 1E '@E6= @ 1E S,E6 16-C,

B()+D PEPS 1 =6-E6 1 =6-E6 @E1,")7P EJE=ESS S@ 'E

n addition to these se%ments( Pepsi has developed &ide ran%e of soft drinks such as Eiet Pepsi( 'affeine <ree Pepsi and lo& sodium Pepsi( Su%ar <ree )Pepsi 1a$.

0"

C/)()CTE(ISTICS O$ T/E 4(ODUCT


These are some of the uni:ue characteristics of the productsG .. 2. 3. 4. 5. Packa%e is returna!le and vulnera!le to !reaka%e. +ei%ht of packa%e is t&ice as much as that of the product. ;as a seasonal demand resultin% in partial idlin% of the distri!ution net&ork. Eemands hi%hli%ht intensive availa!ility of the product &ith very lo& dealer inde$ essential on account of Fimpulse demandK. ,ccupies more shelf space Aor cooler spaceB per a rupee &orth of investment than most other !rand product. This factor( coupled &ith the return a!ility of the container( involves a very hi%h level of service fre:uency. 6. =atio of distri!ution costs to sellin% price is hi%her than for any other !randed mass consumption product. 6ll these point to the fact that a penetratin% distri!ution net&ork coupled &ith efficient feedin% are the only means to hi%her sales.

00

4(ICE
1a$imum retail price of 3// ml !ottles is controlled !y the 'entral Covernment. The other size and packs are priced keepin% factors like competition( internal costs( e$ternal costs( the corporate o!#ective of the company in the mind. 4(ODUCT *;; l b=ttles 3;; l b=ttles , 5iter b=ttles S=da *;; l Cans ,.3 5iter 4ET b=ttles SE55I+G 4(ICE (4er %rate) ,68 062 266 ,22 *,0 *2O M)1.(ET)I5 4(ICE (4er %rate) ,:0 088 28; ,68 *,0 *6O

Price per !ottles the empty !ottles are priced at =s .2/ per crate and the shell at =s .//.

02

4(E$E(E+CE O$ SO$T D(I+#S I+ ) D)Y


,nce a day T&ice a day ,nce a &eek ,ther 25I 2/I 5I 5/I

:)6 &)6 &)6 9)6 8)6%&6%)6 %)6 &6 7)6 )6


3 n c e Taw ic e3 an c e 3 a th e r day day w ee/

3 nce a day T w ic e a d a y 3 nce a w ee/ 3 th e r

$igureD,

2/

4(E$E(E+CE TO T/E B()+D

Pepsi 'oke

6/I 4/I

*)6 :)6 9)6 %)6 )6

:)6 9)6

! epsi

;o/e

! e p s i; o / e
$igure P 0

2.

TO GI.E T/E 4(E$E(E+CES


1ore Popular Packa%in% Taste Price ./I ./I "/I ./I

*)6 :)6 9)6 %)6 )6 7)6 7)6

<)6

7)6 ! r ic e

. o re ! a c / a g in T ga s te ! o p u la r

. o r e ! o p u!la a rc / a g in Tg a s t e! r ic e
$igure P *

22

M)(#ETI+G ST()GG5ES O$ COM4)+Y E$$ECTS T/E S)5ES


5es -o 55I 45I

:)6 &)6 9)6 8)6 %)6 7)6 )6

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n a survey done !y 6 > 1 ma%azines on the !est marketin% companies in ndia. Pepsi and 'oca)'ola &ere also entered. The results &ere as follo&s G Pepsi 'oca)'ola The results of 25 &ere G Pepsi 'oca)'ola D D "th ..th D D 4th ..th

This sho&s that !oth the companies are payin% more attention to the marketin% of their products. Pepsi is hi%her up on the scale than 'oca)'ola. +e can see that !y the !rilliant advertisin% done !y Pepsi( &hich can !e seen on every hook and corner of Corakhpur. The consumers also prefer Pepsi advertisements and other activities of Pepsi( to that of 'oca)'ola.

./.

$I+DI+GS F )+)5YSIS
The ndian soft drinks market is at .4/ million cases per year. This is very lo&( even as compared to Pakistan and ?an%ladesh. 6ll these factors to%ether have contri!uted to a 2/I %ro&th in the soft drinks industry.. f this demand continues to %ro& at 2/I %ro& at 2/I annually( &ithin ./ years the volumes could reach . !illion cases. This kind of %ro&th is the reason for the entry of the t&o %iants of the soft drink industry of the &orld. 'oca)'ola Pepsi 'oca)'ola and Pepsi to%ether control 2"I of the 4 entire ndian market. The rest of the 3I is shared !y companies like 'ad!ury)Sch&eppes and 'ampa) 'ola. The total no. of case sold are .4/ million of these "" million cases of 'ola drinks are sold and 63 million of non)cola drinks. There is a rapid increase in the sale of cola soft drinks. +hereas in .22/( they accounted for a third of all soft drinks sold( no& their share is &ell over half. 6lso cola sales are %ro&in% at a faster rate than non)colas. ,ne of the reasons for this could !e the a%%ressive marketin% strate%ies for 'ola drinks !y Pepsi and 'oca)'ola. The race to :uench the %reat ndian thirst had dei%n.

./2

Mar"et Share 4er%entage in G=ra"h!urD0;;2

786

556 456

Pepsi

Par&e & Coke

Pure #ri%ks

4e!si >indings:
Pepsi is the lar%est sellin% soft drink in ndia today. n Corakhpur it has 55I of the market share. n ndia it has 43I of the market share makin% it the lar%est sellin% soft drink( !ut the second lar%est company in terms of sales. The sales of Pepsi is appro$imately =s. .(/// crore annually in ndia of this only a!out =s. 3/ crore annually is credited to the foods section of Pepsi. The rest is all earned !y the soft drinks. The soft drinks in Pepsi <oods @TE include G .. Pepsi 'ola 2. 1irinda ,ran%e 3. ")7p 4. 1irinda @emon

./3

The main advanta%e the Pepsi has over its nearest competitor i.e.( 'oca)'ola is that of its &as the first multinational to enter ndia( in the soft drinks sector. Pepsi officials and TEial)a)Pepsi* scheme to %ro& the market( instead of %ivin% discounts at the retail level. 6nother point &hich attri!uted to Pepsi*s success is the !ottlin% operations. Pepsi does most of its !ottlin% on its o&n. 6nother si%nificant investment of Pepsi has !een fountains. <ountains have considera!ly increased sales of Pepsi( as they have offered consumers a &hole ne& &ay to e$perience soft drink. 6ccordin% to a study done( 0/I of all soft drinks are consumed on premise( at the point of purchase( rather than at home4 thus the fountain initiative has paid off. Thus &e see that Pepsi has follo&ed a%%ressive marketin% strate%ies makin% themselves %et into the minds of the consumer !y !ein% visi!le inside and outside the consumers home !y &ay of television( radio -e&spapers( hoardin%( sales)promotion schemes( etc. Pepsi has !een voted the num!er one customer service company across cate%ories in terms of re%ularity( availa!ility responsiveness and initiative.

./4

4UB5IC (E5)TIO+S )+G5E


Inn=AatiAe and eE%iting =>>ers The respondents &ere asked to compare !et&een Pepsi'o and 'oca)'ola W X @td. in terms of &ho comes up &ith innovative and e$citin% offers( or rather thin%s &hich are lively and interestin% to participate. 5/I of the respondents( replied in favour of P' &hile 3/I responded in favour of '' . ."I of the respondents thou%ht that !oth &ere e:ually %ood and it varied &ith time( place and occasions. 3I of the respondents &ere not a&are of all the activities and &ere modest to admit it. <ui%" and res!=nsiAe t= di>>erent =%%asi=ns and eAents. 'omparin% Pepsi'o and 'oca)'olaW X@td( 55I of the respondents replied that it &as undou!tedly Pepsi'o. They supported their statement &ith reasonin%( sayin% so that Pepsi'o &as first to associate &ith ndia*s 5/ years of independence. ,n the other hand 22I of the respondents felt that 'oca)'olaW X@td. is not trailin% !ack. t sponsors me%a events like different 'ricket tournaments( ,lympic %ames( +orld 'up <oot!all etc..2I of the respondents came up &ith a more !alanced ans&er. They said if one of the companies sponsors one event its sure that the other &ill definitely %o on for the ne$t. ts a tou%h tussle and is really difficult to demarcate today.

$uture leader in the

ar"et

+hen the respondents &ere asked a!out their perceptions( as &ho &ould !e the future leader in the market( 42I of the respondents replied in favour of
./5

Pepsi'o. 6ccordin% to them Pepsi'o has entered ndian market prior to 'oca)'ola W X @td. and has stron% foothold no&. 6!ove that it is innovative and there is freshness in its 6ds. The only thin% re:uired is to maintain its position.30I of the respondents claimed that after takin% over Parle ndustries 'oca)'ola W X @td. is in a comforta!le position. f it can promote !rands of Parle ndustries like Thums 7p and @imca &hich has a su!stantial market in ndia( it may turn out to !e the leader in future. 6%ain .5I of the respondents feel that !oth the companies are fi%htin% tooth and nail for supremacy. The one &hich commits an error in its strate%y &ill trail !ehind.

./6

CO+5USIO+S
Pepsi is the market leader in terms of soft drinks in ndia( !ut comes second to 'oca)'ola &hich consists of 'oca)'ola and park !rands. ;o&ever in Corakhpur it is the market leader. Pepsi*s main tar%et is o!viously to !e the market leader and leave its nearest competitor( 'oca) 'ola( far !ehind. To achieve this Pepsi seems to !e relyin% on mass advertisin%. They spend a!out 5/)6/ crore rupees annually on marketin% activities. The consumer is !om!arded &ith Pepsi advertisements( si%n( lo%o*s etc.( every&here. Pepsi*s core market is the youn% 9adult and Pepsi is takin% %reat measures to chan%e the perception of these youn%)adults.( Pepsi &ants that these consumers should associate all colas as Pepsi( the !rand Pepsi and cola should !e synonymous &ith each other. This they are tryin% to do !y %ettin% the heros of these consumers to endorse their product e.%. Sachin Tendulkar and also !y advertisin% for and !y youn%sters. Pepsi drinks are availa!le in almost the &hole of ndia( this sho&s the importance paid to distri!ution. ?rand loyalists are very fe& in the market. Thus the drink should !e easily availa!le( so that consumers cannot shift their preferences.

C=nsu ers
<or the purpose of the study( :uestionnaires &ere prepared for the 'onsumers. 'are &as taken to intervie& all types of consumers( i.e.( G a. Eifferent a%e %roups !. 1ales and females
./"

c. People from different localities( etc. n all a!out 6/ consumers &ere intervie&ed. The conclusions that one can dra& from these ans&ers provided !y the consumers sho&ed that marketin% activities do form a ma#or part of the decision. ,ne thin% that &as common amon%st all the consumers &ho &ere once a day or once a &eek. The num!er one factor the influences a customer &hile !uyin% a soft)drink &as taste. This &as true for all the consumers &ho &ere intervie&ed. The rest of the conclusions as deducted from the :uestionnaires are as follo&s G The youn%er %eneration preferred soft drinks to the older %eneration. a. 'hildren upto .5 years of a%e liked to have soft drinks upto 2)3 times a day. !. 5oun% adults liked to have soft drinks upto .)2 times a day. c. 6dults liked to have soft drinks a!out once or t&ice a &eek. 'hildren preferred 'oca)'ola <anta( 1irinda oran%e. 5oun% adults liked Pepsi. The older %eneration preferred 'oca)'ola( @imca > 1irinda @emon. The reason %iven for choice of facourite soft drink &as taste and easy availa!ility. ,nly if the consumer liked the taste of drink( he &ould have it a%ain.25I of the consumers felt that marketin% strate%ies of the company did affect the sales of their soft)drink. 1arketin% strate%ies made the consumer try a drink for the first time. The second time round it &as the consumers choice himself and not strate%y could affect that. 5oun%sters &ere more accepta!le to chan%e. They tried

./0

different drinks( 'ola and non)'ola. 6dults Stick to one and they prefer drinks that do not affect their health( like @imca. 1a#or num!er of people found television advertisin% to !e the most effective. 5oun% and the old( all liked to &atch the advertisements on television. Sponsorin% events( outdoor advertisin% and sales promotion schemes &ere second choice of the consumers. 7nder television advertisin%( Pepsi came in as the num!er . favorite of the people the advertisement of Shah)=ukh 8han and the do% &as the favorite of the consumers. Their ne& advertisement of 1irinda @emon is also lifted !y the people. The advertisement that came in second &as( the 'oca)'ola advertisement of the people 'ricket and the son% 1ust)8alander %oin% on at the !ack. These( advertisement remained most in the minds of the people.1ost of the consumers felt that Pepsi &as the market leader in the soft)drink industry( in Corakhpur as &ell as in ndia. +hereas &hile Pepsi is the leader in Corakhpur( in ndia 'oca)'ola is num!er one. 22I of the consumers intervie&ed felt that the marketin% strate%ies of the 'oca)'ola and Pepsi have helped them in attainin% the hu%e market share that they possess.+omen and children prefer cans as compared to men. These are the ma#or conclusion that can !e dra&n a!out a consumers* !ehaviour. 'ompanies must take the initiative of findin% out the ha!its of the consumers and then chan%in% them( in their favour.

./2

(ECOMME+D)TIO+S
Soft drinks are an impulse product. +hen a person is thirsty( he &ould first think of &ater or tea. Some even &ould prefer T-im!u Pani*. The ndian population is the lar%est in the &orld today( there can !e no other country in the &orld( &hich provides so much of an opportunity for the soft) drink manufacturers. The ndian soft drink market is at .4/ million cases per year( this is very lo&. Thus the consumption of soft drink can %o up. Sinc..0Ue the entry of 'oca)'ola into the country the industry is %ro&in% at a rate of 2/I annually. f this rate is maintained( then !y the year 2//5 the market of soft drink &ould !e . !illion cases annually. ;o&ever 'oca)'ola &ants to accomplish this feat !y themselves. To do this the industry has to take certain steps. 6ll the companies are fi%htin% to %et a ma#or share of this %ro&in% market. They should all try to increase the total market alon% &ith their individual shares. ,n the !asis of all the field &ork and ta!le &ork done( some su%%estions can !e made( &hich may help the company in increasin% the total market as &ell as the sale of the companies. The various su%%estions that can !e made are as follo&sG) Soft drinks retail at prices !et&een =s. 6 and =s. ./. These are e$pensive &hen measured a%ainst purchasin% po&er. 6ccordin% to one study( it takes an ndian 5/ minutes of &ork to !e a!le to !uy a !ottle in other countries( the norm is five minutes. Thus to increase the total market of soft drinks( manufactures should try and decrease the prices( so as to increase sales.

../

6vaila!ility is a ma#or factor( &hich makes the consumer !uy a soft drink. Soft drinks should !e made availa!le more readily than present. There are only 3//( /// retailers stockin% soft drinks in ndia. Thus retailin% outlets should !e increased. 6lso related to this point( is vendin% machines. n developed machines( vendin% machines are kept in all consumer areas( like super markets( schools( amusement parks( local markets( etc. These tempt a person into !uyin% the soft drink. So if vendin% machines are put in strate%ic areas( it &ould definitely increase consumption of soft drinks. Soft drink cans &hich are very convenient( as the consumer can take them any&here( unlike a !ottle( are very e$pensive retailin% from =s. .5)=s. .0. To increase sale of cans( this price should !e !rou%ht do&n. nnovations increase sales of company. <or e.%. fountain Pepsi increased sales of Pepsi 'ans increased sales of 'oca)'ola. Thus the companies should constantly come out &ith innovative ideas.E$ample)3// ml plastic !ottles( &hich the consumer can take &ith him( unlike the %lass !ottles( &hich he has to return. Plastic !ottles can even !e used a%ain !y households for various purposes. The companies should conduct studies to %et to kno& a!out consumer ha!its. <or e.%. 'oke kno&s that 6mericans see 62 of its commercials every years ( put 5.2 ice cu!es in a %lass and prefer cans to pop out of vendin% machines at a temperature of 35 de%rees. f the companies kno& all this and more a!out ndian consumer !ehaviour( it could tell them ho& to sell their drinks( so as to increase sales. t is seen n ndia( that people prefer havin% their drinks &ith or after food. 'ompanies could have commercials &hich sho& people en#oyin% their drink

...

&ith a %ood meal( so that consumers associate drinkin% soft drinks &hile havin% food. 'ompanies should try to educate the consumer a!out the health related su!#ect. <or e.%G) aB @imca is recommended to patients !y doctors. !B 'ola drinks are kno&n to !e very fattenin% ( ?ut in fact cola drinks contain no calories from fat they contain calories from su%ar &hich can !e easily !urned off. The soft drink cans and plastic !ottles should mention the calories and other related information on the packin%. 'ompanies should try to !uild hi%h !rand e:uity. This provides a num!er of advanta%es to the company. aB The company en#oys reduced marketin% costs !ecause of hi%h level of consumer !rand a&areness and loyalty. !B The company &ill have more trade levera%e in !ar%ainin% &ith distri!utors and retailers since the customer e$pects them to carry the !rand. cB The company can chan%e a hi%her price than its competitors !ecause the !rand has hi%her perceived :uality. dB The company can more easily launch !rand e$tension. eB 6!ove all( the !rand offers the company some defence a%ainst fierce price competition. The companies should %o in for diversification

..2

,nce the !rand is kno&n( it is easier to sell more of its products. <or e.%. 'oca)'ola clothes have sold a!out H.// million &orth of clothes and accessories. This &ould increase revenues of the company. The companies should not have competitor myopia. t is more often the latent company than the current competitor &ho !usies the company. Pepsi and 'oca)'ola are so !usy fi%htin% &ith each other( that they have left the non)cola sector open for 'ad!ury)Sch&eppes. 6dvertisin% is a &ay !uildin% !rand ima%e. t does not promote :uick sellin%. Thus companies should used advertisin% only for lon% advertisin% can !e used forG aB ?rand ima%e !uildin% !B =eminder advertisin% Gremindin% people to !uy these drinks. cB =einforcement advertisin%)Tellin% people that they have made the ri%ht choice. Television advertisin% seems to make a impact on the consumers A!ased on :uestionnaire ans&ersB so companies should concentrate more on television advertisements. Sales promotion tools create a stron%er and :uicker response. Thus sales promotion tools such as coupons( contests( premiums and the like should !e used to dramatize product offers and to !oost sales. Sales)promotion effects are usually short run and induce the people to purchase soft drinks( no&. 'oca)'ola and Pepsi have taken up sponsorin% of events on a ma#or scale. 6ll kinds or events( &hether !i% A+ills +orked cupB or small Acolle%e contestsB have either Pepsi or 'oke !anners of sponsorship. The

..3

effectiveness of this can !e :uestioned. +hether these activities increase sales or not is a !i% hu%e :uestion mark. Pepsi'o and 'oca 'olaA B@td. should reduce their massive spendin% on sponsorin% events and try and channel this money into more productive activities ( like innovative packa%in% etc. t is recommended that company should introduce more and more customer oriented schemes and conte$ts. <or e%. Pepsi*s ne& campai%n FPepsi cool malK in &hich they are %ivin% free %ifts to their customers. The company should maintain a small %roup of Fmissionary sales manK &hose functions should !e to %uide distri!utors and retailers( feed!ack to the company. t is also recommended that companies should launch soft drink in small pack 2// ml and .5/ ml. Thus &e see that there various steps &hich can !e taken !y the companies to increase their sales and to increase the total market share. keep a constant &atch over the prevailin% situation to provide the continuous

..4

BIB5IOG()4/Y

1arketin% 1ana%ement) ?y Philip 8otler ?usiness &orld ,ut look Times of ndia 'ourse pack of =ai university &&&.Pepsico.indialtd

=esearch methodolo%y) ?y '. =. 8othari

..5

<UESTIO++)I(E
<.,. 9/IC/ B()+D 9I55 YOU 4(E$E(E+CE O$ SO$T D(I+#S I+ ) D)YH ,nce a day T&ice a day ,nce a &eek ,ther <.0. 9/IC/ B()+D )(E YOU 4(E$E(E+CE TO T/E B()+DH Pepsi 'oke <.*. 9/IC/ 4)(TICU)5)( ()TE TO GI.E T/E 4(E$E(E+CESH 1ore Popular Packa%in% Taste Price <.2. )(E T/E M)(#ETI+G ST()GG5ES O$ COM4)+Y E$$ECTS T/E S)5ESH 5es -o <.3. 9/IC/ $O(M O$ M)(#ETI+G ST()TEGIES IS MOST E$$ECTI.E I+ T/E M)(#ETH Television 6dvertisin% -e&spaper 6dvertisin% ,utdoor 6dvertisin% Sales Promotion

..6

<.6. 9I55 YOU C/)+GE T/E B()+D O+ T/E B)SIS O$ 4(ICE (EDUCTIO+H 5es -o <.7. 9/IC/ B()+D MO(E E$$ECTI.E I+ )D.E(TISI+GH Pepsi 'o. 'oke 'o. <.8. 9/IC/ B()+D /)S C(E)TI.E )+D )44E)5I+G )D.E(TISI+G O$ T/E SO$T D(I+# COM4)+YH Pepsi 'o. 'oke 'o. <.:. 9/IC/ B()+D /).I+G T/E I++O.)TI.E )+D E1CITI+G O$$E(SH Pepsi 'o. 'oke 'o. <.,;. 9/)T /).E T/E M)(#ET S/)(E 4E(CE+T)GE I+ GO()#/4U(H Pepsi 'oke Pure Erinks <.,,. 9/IC/ B()+D /).I+G T/E M)(#ET 4E(CE+T)GE S/)(E I+ )55 O.E( I+DI)H Pepsi 'oke @ocal ?rand

.."