Professional Documents
Culture Documents
Edited Format
Edited Format
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Marketing Plan
Caro, Anfernee
Cheng, Alexander V.
Danao, Matthew
A Marketing Plan submitted to the faculty of the Senior High School Department
Far Eastern University – Diliman
in Partial Fulfillment of the Requirements
for the courses of
Principles of Marketing
Applied Economics
Business Finance
Quantitative Techniques
October 2019
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
A. Industry Definition
Pepsi-Cola Products Philippines Inc. belongs to the Food and Beverage industry.
establishments: (1) those that manufacture nonalcoholic beverages; (2) those that
manufacture alcoholic beverages through the fermentation process; and (3) those that
produce distilled alcoholic beverages. Ice manufacturing, while not a beverage, is included
with nonalcoholic beverage manufacturing because it uses the same production process as
water purification.
products into products for intermediate or final consumption. The industry groups are
Products Philippines, Inc.: Strategic Management Paper Baylosis, 2017 MBA 218 6
materials (generally of animal or vegetable origin) processed into food products. The food
for distribution to consumers, but establishments primarily engaged in retailing bakery and
candy products made on the premises not for immediate consumption are included.
B. Industry Segmentation
Marketing segmentation means dividing a market into smaller groups with distinct
mixes. Marketers consist of buyers and buyers differ in one or more ways. They may differ
in their wants, resources, locations, buying attitudes, and buying practices. Through market
segmentation companies divide large, heterogeneous markets into smaller segments that
can be reached more efficiently with products and services that match their unique needs.
1) Demographic Segmentation
The company also made area wise segmentation and usually moves towards
college, cinemas, restaurants, hotels, where the strength of young people are
greater. The company also focuses towards students of colleges and schools.
2) Psycho-graphic Segmentation
The company also segments its market with respect to social class, lifestyles
and personalities, they focuses their attention towards lower upper and middle class
3) Behavioral Segmentation
company tries to market their product for the occasions like weddings, concerts and
sports events. Now days the demand of Pepsi Cola has increased due to the wedding
areas. It also focuses towards the Brand loyal people or the people who are heavy
user of Pepsi Cola. And those people are in the colleges and universities.
8.7
17.4
48.4
23.3
D. Seasonality
The Company’s sales are subject to seasonality. Sales are generally higher in the
hot, dry months from March through June and lower during the wetter monsoon months of
July through October. While these factors lead to a natural seasonality on the Company’s
sales, unseasonable weather could also significantly affect sales and profitability compared
to previous comparable periods. Higher sales are likewise experienced around the
Consequently, the Company’s operating results may fluctuate. In addition, the Company’s
to these fluctuations, comparisons of sales and operating results between periods within a
single year, or between different periods in different financial years, are not necessarily
F. Environmental Scan
F.1.
Political
Political factors play a significant role in determining the factors that can impact
Pepsico, Inc.'s long term profitability in a certain country or market. Pepsico, Inc. is
operating in Beverages - Soft Drinks in more than dozen countries and expose itself to
different types of political environment and political system risks. The achieve success in
such a dynamic Beverages - Soft Drinks industry across various countries is to diversify
the systematic risks of political environment. Pepsico, Inc. can closely analyze the
country's economy.
sector.
government.
Consumer Goods
Legal
In number of countries, the legal framework and institutions are not robust enough
evaluate before entering such markets as it can lead to theft of organization’s secret sauce
thus the overall competitive edge. Some of the legal factors that Pepsico, Inc. leadership
country.
Discrimination law
Employment law
Data Protection
Economic
The Macro environment factors such as – inflation rate, savings rate, interest rate,
foreign exchange rate and economic cycle determine the aggregate demand and aggregate
impact the competitive advantage of the firm. Pepsico, Inc. can use country’s economic
factor such as growth rate, inflation & industry’s economic indicators such as Beverages -
Soft Drinks industry growth rate, consumer spending etc to forecast the growth trajectory
of not only --sectoryname-- sector but also that of the organization. Economic factors that
in local market?
particular country.
Discretionary income
Unemployment rate
Inflation rate
Interest rates
Socio-Cultural
Society’s culture and way of doing things impact the culture of an organization in
an environment. Shared beliefs and attitudes of the population play a great role in how
marketers at Pepsico, Inc. will understand the customers of a given market and how they
design the marketing message for Beverages - Soft Drinks industry consumers. Social
factors that leadership of Pepsico, Inc. should analyze for PESTEL analysis are –
Leisure interests
Technological
A firm should not only do technological analysis of the industry but also the speed
at which technology disrupts that industry. Slow speed will give more time while fast speed
of technological disruption may give a firm little time to cope and be profitable.
F.2.
G. Customer/Consumer Analysis
Demographic Characteristics
All age and gender from children to adults with income coming from
parents or work.
Geographic Characteristics
Psychographic Characteristics
Working to upper class who are willing to pay and buy the product of
PepsiCo.
Behavioral Characteristics
Demographic Segmentation
Consumers who are average, above average and high average earners.
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Geographic Segmentation
Psychographic Segmentation
Behavioral Segmentation
Customers that are ‘Hard core loyals’ and ‘Soft core loyals’.
H. Industry Trends
The Company is not aware of any trend that may affect its liquidity. The Company’s
performance will continue to hinge on the overall performance of the Philippine economy,
the natural seasonality of operations, and the competitive environment of the beverage
The company’s sales volume declined by as much as 20 percent last year as the
business was impacted by the higher taxes on sweetened beverages slapped by the
government under the Tax Reform for Acceleration and Inclusion (TRAIN) Law.
However, the firm still ended 2018 with higher net sales of P33.59 billion compared to
P30.31 billion in 2017 due to the price increases driven by the excise taxes.
As for the PCPPI, “The effect of the TRAIN law on volume and cost continue to
adversely impact the company’s profitability with net loss at P81 million year-to-date,”
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
The firm will continue to invest for future growth despite the decline in volumes. It spent
a total of P1.7 billion in capital expenditures during the January to September period.
A. Company Background
PepsiCo beverages and snacks in the Philippines, with a relationship spanning 70 years.
PCPPI is a listed company in the Philippine Stock Exchange (PSE: PIP) with Lotte
companies in South Korea, as the lead shareholder co-managing with PepsiCo. PCPPI
manufactures and sells well-known food and beverage brands: Pepsi-Cola, Mountain Dew,
7-Up, Mirinda, Mug, Gatorade, Tropicana, Lipton, Sting, Premier, Milkis, Aquafina, and
Cheetos. It has established 14 operations across the country, serving more than 700,000
outlets and providing employment through its extensive distribution network. PCPPI is
A.1. History
Premier Beverages by Luis Lorenzo, Sr. to acquire the bottling and distribution
Guoco management, ₱700 million was spent in 1998 to upgrade the facilities of
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
PCPPI. In 2000, PepsiCo paid P 2 billion to the Guoco Group to acquire a 33%
stake in PCPPI. News reports cited the rationale was to ensure PepsiCo had a
continuing market for its concentrates, even if it meant infusing money into its
licensed bottlers. PCPPI became listed in the Philippine Stock Exchange in 2008.
acquired 34% of PCPPI. The acquisition made Lotte Chilsung the largest
shareholder in PCPPI. Lotte Chilsung agreed to pay P4.447 billion to buy the 1.27
billion shares from the Guoco Group.[3][4] In 2013, Lotte Chilsung increased its
Philippine Islands Ltd. Clarkin was an American who came to the Philippines as a member
of the US Air Force during the close of World War II. In the beginning, the company
imported Pepsi-Cola until 1947, when its first bottling plant was established in Quezon
City. After Clarkin returned to the United States in 1957, PepsiCo International took over
the Philippine operations. In 1983, the Philippine operations became a branch of PepsiCo’s
New York office - renamed PepsiCo, Inc. (Philippine branch) - and operated until 1985.
From 1985 to 1989, Pepsi-Cola Distributors of the Philippines, Inc., a group identified with
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Filipino businessmen Ernest Escaler and Eduardo Cojuangco, Jr., took over the Philippine
franchise.
A.2. Mission/Vision
Mission
FOR CONSUMERS:
FOR CUSTOMERS:
FOR SHAREHOLDERS:
corporate governance.
Vision
accelerate our top line growth, whilst keeping our commitment to do good for the
planet and our communities. It builds on decades of progress we’ve made since
PepsiCo was founded in 1965, while setting a firm foundation for a new era of
growth and prosperity. To help us achieve this vision, we’ve defined a new set of
Brands
Carbonated:
Pepsi
Pepsi Light
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Pepsi Max
7 Up
Mountain Dew
Mirinda
Mug
Lotte Milkis
Non-Carbonated:
Tropicana
Lipton
Lipton Sparkling
Gatorade
G Active by Gatorade
Lotte Let’s Be
Snack Foods:
Cheetos
Doritos
Fritos
Lay’s
Ruffles
Lay’s Stax
Other
Knick Knacks
Lotte Xylitol
Delfi
Goya
Boom Boom
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
8oz Glass
Pepsi Bottle
12oz Glass 5.00PHP
Bottle 9.00PHP
750ml 18.00PHP
Glass Bottle 25.00PHP
1Liter Glass 17.95PHP
bottle
26.95PHP
250 ml cans
50.00PHP
330 ml cans
61.50PHP
1.25L
74.50PHP
1.75L
2.25L
8oz Glass
Bottle
Mountain Dew 12oz Glass 7.00PHP
Bottle 9.00PHP
750ml Glass
18.00PHP
Bottle
25.00PHP
1Liter Glass
17.95PHP
bottle
26.95PHP
250ml cans
50.00PHP
330ml cans
61.50PHP
1.25L
1.75L 74.50PHP
2.25L
7up Diet
7UP 7.00PHP
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
1Liter Glass
bottle
330ml cans
1.25L
2L
Root Beer
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
8oz Glass
Bottle 7.00PHP
330ml cans 20.50PHP
1.25L 30.00PHP
1.5L 39.00PHP
2.25L 44.00PHP
Pink 1.5L
Lemonad
e
Lemon
Lime
Orange
Chill
Gatorade
Propel:
Mandarin
Orange,
Gala
Apple and
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Zero-
Calorie
Lemon
Gatorade
Low Carb:
Lime and
Grape
Tropicana
Tropicana 8oz Glass 10.00PHP
Twister, Bottle 21.50PHP
no pulp 49.50PHP
Juicy Pulp 355 ml
orange
juice
drink with 1L
real pulp
sacs
Fruit
Burst
Tropical
juice
drink with
real
pineapple
cubes
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Sting
The company offers its products through direct sales, distributors, and
Under the DSD system, PepsiCo delivers products directly to retail stores.
visibility. It’s more suitable for products that are restocked often and are sensitive
Customer Warehouse
It’s ideal for products that are less fragile and perishable, have lower turnover, and
schools, and stadiums through third-party food service and vending distributors and
operators.
(2018)
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
The company won an Innovation Award for its initiative in developing activities
and projects tailor-made for 7-Eleven, in particular the exclusive launch of Pepsi
Vanilla 500ml in stores. The award also acknowledged the company’s consistent
run of price promotions for summer and Christmas which helped maximize sales
of the Softdrinks category. PCPPI also received the Brand Activation Partnership
Award for its strong support of 7-Eleven’s marketing activities. For 2018, the
Pokémon), and Slurpee activations (Slurpee Summer Hit Song, and Slurpee Build
Your Own Concert). As a result of the latter, PCPPI helped regain sales for Slurpee,
in spite of TRAIN and subsequent price increase. In addition, PCPPI also supported
7-Eleven’s other events (the annual Run 2018 and Trail 2018) and promotions
(New Year New Ride Promotion). Finally, PCPPI also won the Account
(2009)
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
as compared to the 2009 baseline. Achieved a 16 percent reduction in per unit use
compared to a 2009 baseline. Introduced the first fully compostable Sun Chips bag,
which is made with 100 percent renewable plant-based materials. Increased the
saturated fat by more than 50 percent in U.S. Lays and Ruffles potato chips.
The PepsiCoPh is Operating in more than 200 countries, the parent company
of Pepsi has been the leading company in the food & beverages industry having more than
The convenience of purchasing, availability, Low-price, favorable taste are some of the
things a customer expect in a competitive non-alcoholic beverages market and that’s what
offered by Pepsi which makes it a leader in its segment fighting neck- on the neck with
Coca-Cola.
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Pepsi's market share is increasing 1 or 2 points over the last 8 to 10 years, which is
quite significant. If we take up to last 10 years, it’s almost 12% increase in the company’s
share. 1996 was a bad year for Pepsi because the pricing was high. And as the consumer
income has caught up, hopefully consumers will now get familiar to this price change. There
will be now more competition and whenever there is competition there is a lot of market
activity, distribution improves, promotion improves and advertising improves. At the end of
1996 in Nov., Dec., when Coca Cola launched its 300 Ml pack Pepsi also launched its 300
ML. This created competition and prices went down. This increase the market so much, that
Pepsi sales were so high during Nov., Dec., that it has never been whole year. This shows
It uses mass marketing strategy to target the groups of the customers of different
demographics and geographic regions. Segmentation is the important strategy which helps
the brand in targeting the specific group of customers with differentiated offerings. Pepsi
is the mass market product which uses undifferentiated targeting strategies in order to be
competitive and increase its sales. In the non-alcoholic beverage market, it has positioned
itself as a young, vibrant and passionate brand which challenges the conventional things.
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Pepsi and Diet Pepsi (Pepsi Zero Sugar) are the Cola beverages in which Pepsi
deals in. The offerings of PepsiCo under the Pepsi brand are Stars in the BCG matrix due
to its popularity among the youth and the emotional connect with the masses in their special
As a fast consuming commodity, the sales of soft drinks are expected to depend on
the distributing channels. The success of distribution strategy is able to encourage the
consumers make purchase decision right away. Pepsi is one of the leading beverage
companies in the world. Apart from Cola and soft drinks, the company also supplies water,
juice, tea drinks, etc. One of the remarkable slogans of Pepsi is “Dare for more”. Channel
strategies are related to several factors, including places, margins, brand strategies, etc.
However, the most important factor must be the business objective of the company. As for
Pepsi, certainly, the distribution strategy plays an important role in relation to the long term
business strategy of Pepsi. In general, the distribution strategies of Pepsi contain several
Pepsi Co Ph has satisfied consumers' bellies for more than a century. But recently, the
company has left shareholders craving more. With increased competition and loss of
market share, many investors wonder if this global snack food and beverage giant is simply
Increased focus on negative health effects of soft drinks and unhealthy foods.
The risk to PepsiCo is that persistent and continued emphasis on these effects may
curtail soda and snack-food consumption. Soda makers are banding together to proactively
tackle the issue. In selected cities next year, they will roll out vending machines that'll not
only display the number of calories in a container of soda, but also suggest a lower-calorie
beverage option. Fast-food operators have mostly borne the brunt of the backlash against
unhealthy foods, but PepsiCo could feel more pressure regarding its salty snacks in the
future.
PepsiCo's credit rating was lowered due to the debt it took on to fund bottler
acquisitions. The acquisitions and restructuring costs will pressure bottom-line growth in
the short term and have the potential to lower return on investment and increase commodity
cost pressures.
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
Some possible solutions for Pepsi, if they want to gain competitive advantage in
the market, is to invest further in its supply-chain management. Emphasis in research has
been placed upon global supply-chain management, where the notions of channel strategies
have been drawing the interest of all. Pepsi needs to incorporate these concepts and tools
into its marketing strategy in order to enable efficiency in supply-chain management. Its
focus needs to be on customer satisfaction in the market and cost efficiency along with a
leadership strategy that takes into account cultural gaps that are affecting its ability to reach
all customers.
V. Competitive Analysis
A. Industry Participants
The company is competing for the betterment of its firm, becoming more
sustainable and to widen their target market. Companies are using different marketing
strategies in order to pull potential investors and consumers. There are a few leading
companies when it comes to carbonated beverages. The national chains are a growing
volume buying, and a general trend toward name-brand loyalty for buying in the
Refreshment Corporation. Pepsi and Coke’s products such as “Pepsi Perfect” and
“Vitamin Water” are slightly substitutable for one another. Their products can
influence the market share of one another through effective strategies. One example
of Pepsi’s indirect competitor is Nestle Juice. They are distant competitors of one
another. It means that their products satisfy the same wants but they are in an indirect
BRAND
Market
Shares 17.4% 48.4% 28.3% 8.2% 60%
Based on the information we gathered, Coca-Cola has the best performance among the
following beverages company. Due to its wide-range of market, Coca-Cola Company became one
of the most popular brand in the world. The main competitor of the Pepsi-Cola Products
Philippines Inc. is the Coca-Cola Company. Even Coca-Cola’s market share in the beverage
market, they are dominating, despite this instance, Pepsi-Cola still have what it takes to compete
C. Comparative Analysis
BRAND
*Mountain
Dew
*Sarsi *RC Cola No
Sugar
*Bear Brank Milk
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
*7Up
*Sprite
*Juicy Lemon
*Mirinda *Minute *Nestle Fresh and
Low Fat
Maid
*Mug
Rootbeer *Royal-Tru *Fruit Soda
Orange Orange
*Nescafe
*Gatorade
*Sparkle
*Seetrus
*Arcy’s
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
*Sting Rootbeer
*Tropicana
*Rite ‘n Lite
*Lipton
*Milkis
Pepsi-Cola can use its strengths to effectively respond to the issues identified in this SWOT
analysis, especially those considered as threats. The realistic actions that Pepsi-Cola could take to
Pepsi-Cola’s continued global growth and prominence reflects the company’s strengths.
This aspect of the SWOT analysis framework outlines internal strategic factors that enable firms
to fulfill their business goals. The following are the most significant strengths of PepsiCo:
As a successful global company has one of the strongest brands in the market. This strength
enables the firm to attract consumers to its new products. In addition, the broad product mix
represents Pepsi-Cola’s increasing ability to reach various markets and segments, such as through
Frito-Lay products, Quaker products, and Pepsi products. Pepsi Cola’s extensive global production
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila
and distribution networks are strengths that support the company’s international growth and
expansion strategies. In this aspect of the SWOT analysis, Pepsi Cola’s strengths are sufficient to
Pepsi-Cola suffers from a number of weaknesses that act as barriers to international growth.
The internal strategic factors that limit organizational development are considered in this aspect of
Pepsi Cola derives about 70% of its revenues from markets in North America and South
America. This weakness indicates that the company has not yet maximized potential revenues
outside the Americas. In addition, PepsiCo operates primarily in the food and beverage industry.
This is a weakness because it maximizes the company’s vulnerability to risks in the food-and-
beverage market. Also, PepsiCo fails to effectively market many of its products to health-
conscious consumers. This aspect of the SWOT analysis highlights weaknesses that PepsiCo must
Pepsi-Cola has opportunities for continued global growth. In this aspect of the SWOT
analysis framework, external strategic factors that provide options for business improvement are
1. Business diversification
complementary firm that is not in the food and beverage industry. Another opportunity is for
PepsiCo to increase its penetration in developing countries to generate more revenues from
markets outside the Americas. In addition, PepsiCo can create alliances with complementary
business to increase its market presence. Based on this aspect of the SWOT analysis, PepsiCo has
The food and beverage industry experiences a variety of threats. External strategic factors
that could reduce business performance are considered in this aspect of the SWOT analysis
framework. In Pepsi-Cola’s case, the following are the most significant threats:
1. Aggressive competition
3. Environmentalism
Aggressive competition is a major threat against the company. The influence of the Coca-
Cola Company is especially significant against Pepsi-Cola. In addition, the healthy lifestyles trend
is a threat against Pepsi-Cola’s products, many of which are seen as unhealthful because of their
sugar, salt, or fat content. Also, environmentalism threatens the company in how consumers
negatively respond to product waste and Life cycle issues. This aspect of the SWOT analysis
indicates that Pepsi-Cola must reform its strategies to overcome the threats to business.
Far Eastern University Diliman
Sampaguita Avenue, Mapayapa Village, Diliman, Quezon City, 1101 Metro Manila