Contents

EXECUTIVE SUMMARY.............................................................................................................1
1. INTRODUCTION.......................................................................................................................2
1.1. HISTORY OF PEPSI COLA................................................................................................2
1.2. HISTORY OF PEPSI COLA PAKISTAN...........................................................................3
2. MISSION AND VISSION..........................................................................................................4
2.1. MISSION STATEMENT:....................................................................................................4
2.2. VISION STATEMENT:.......................................................................................................4
3. COMPANY PROFILE:...............................................................................................................5
4. PRODUCT DESCRIPTION:.......................................................................................................6
5. KEY CUSTOMER MARKETS:.................................................................................................7
5.1. PACKAGING:......................................................................................................................7
6. TARGET MARKET:...................................................................................................................8
6.1. POSITIONING:....................................................................................................................8
6.2. SEGMENTATION...............................................................................................................8
7. MARKETING CHANNELS:....................................................................................................10
8. CORE COMPENTANCIES:.....................................................................................................11
8.1. STRONG MARKETING:..................................................................................................11
8.2. STRONG COMMITED EMPLOYEES.............................................................................11
8.3. DECENTRALIZED IN DECISION MAKING:................................................................11
8.4. FINANCIALLY STRONG:...............................................................................................11
8.5. DOMINANT MARKET SHARE:.....................................................................................11
8.6. TARGET MARKET:..........................................................................................................12
9. STRATEGIC BUSINESS UNITS:............................................................................................13
9.1. FRITO-LAY BRANDS:.....................................................................................................13
9.2. PEPSI-COLA BRANDS:...................................................................................................13
9.3. GATORADE BRANDS:....................................................................................................14
9.4. TROPICANA BRANDS:...................................................................................................14
10. COMPETITORS:....................................................................................................................15
10.1. DIRECT COMPETITORS:..............................................................................................15
10.2. INDIRECT COMPETITORS:..........................................................................................15
11. MARKET SHARE OF COMPANY:......................................................................................16
12. MARKET SHARE OF COMPETITOR:.................................................................................16
13. MARKETING ALLIANCES:.................................................................................................17
14. MARKETING RESEARCH:..................................................................................................18
15. SOCIAL CLASS FOR PRODUCTS:......................................................................................19
16. PUSH AND PULL STRATEGY:...........................................................................................20
16.1. PUSH STRATEGY:.........................................................................................................20
16.2. PULL STRATEGY:.........................................................................................................20
17. DIGITAL MARKETING:.......................................................................................................21
18. BENEFITS:..............................................................................................................................22
18.1. STRONG BRAND NAME:.............................................................................................22
18.2. ECONOMY:.....................................................................................................................22
18.3. CONVENIENCE:.............................................................................................................22
18.4. HEALTH MEASURES:...................................................................................................22
18.5. TASTE:.............................................................................................................................22
18.6. ADDICTION:...................................................................................................................23
19. PRODUCT FEATURES:........................................................................................................24
20. PRICING STRATEGY:..........................................................................................................25
20.1. Prices of Different Bottles................................................................................................25
20.2. DISCOUNTS:...................................................................................................................26
21. DISTRIBUTION STRATEGY:..............................................................................................27
21.1. DIRECT DISTRIBUTION:..............................................................................................27
21.2. INDIRECT DISTRIBUTION:..........................................................................................27
22. SWOT ANALYSIS:................................................................................................................28
22.1. STRENGTHS:..................................................................................................................28
22.2. WEAKNESSES:...............................................................................................................28
22.3. OPPORTUNITIES:..........................................................................................................29
22.4. THREATS:.......................................................................................................................29
23. GOALS OF THE COMPANY PER YEAR:...........................................................................30
24. THREATS FROM NEW ENTRANTS:..................................................................................31
25. LINE EXTENSION:................................................................................................................32
26. BRAND/CATEGORY EXTENSION:....................................................................................33
27. MARKETING PROMOTIONS PER SEASON/FESTIVALS:..............................................34
28. PEST ANALYSIS:..................................................................................................................35
28.1. POLITICAL INFLUENCE:.................................................................................................35
28.3. SOCIO-CUTURAL INFLUENCES:....................................................................................36
28.4. TECHNOLOGICAL INFLUENCES:..................................................................................37
29. FINANCIAL REPORTS:........................................................................................................38
30. CONCLUSION:......................................................................................................................39
 EXECUTIVE SUMMARY

Purpose of this project is to study the strategies which Pepsi is doing in Pakistani market for its
product Pepsi cola. Pepsi International is a world renowned brand. It is a very well organized
multinational company, which operates almost all over the world. In Pakistan It also has proved
itself to be the No.1 soft drink.
Now days Pepsi is recognized as Pakistanis National drink Pepsi's greatest rival is Coca Cola.
Coca Cola has an international recognized brand. Coke’s basic strength is its brand name. But
Pepsi with its aggressive marketing planning and quick diversification in creating and promoting
new ideas and product packaging, is successfully maintaining is No.1 position in Pakistan. Pepsi
is operating in Pakistan, through its 12 bottlers all over Pakistan. These bottlers are Pepsi's
strength. Pepsi has given franchise to these bottlers. Bottlers, produce, distribute and help in
promoting the brand.

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1. INTRODUCTION

Pepsi International is a world renowned brand. It is a very well organized multinational

company, which operates almost all over the world. They produce, one of best carbonated drinks
in the world. Pepsi is a symbol of hygiene, quality and service, all over the world. Pepsi is
producing Cola for more than 100 years and it has dominated the world market for a long time.
Its head office is in New York.

1.1. HISTORY OF PEPSI COLA

It was first introduced as "Brad's Drink" in New Bern, North Carolina in 1898 by Caleb
Bradham, who made it at his pharmacy where the drink was sold. It was later named Pepsi Cola,
possibly due to the digestive enzyme pepsin and kola nuts used in the recipe. Bradham sought to
create a fountain drink that was delicious and would aid in digestion and boost energy.
In 1903, Bradham moved the bottling of Pepsi-Cola from his drugstore to a rented warehouse.
That year, Bradham sold 7,968 gallons of syrup. The next year, Pepsi was sold in six-ounce
bottles, and sales increased to 19,848 gallons. In 1909, automobile race pioneer Barney Oldfield
was the first celebrity to endorse Pepsi-Cola, describing it as "A bully drink...refreshing,
invigorating, a fine bracer before a race". The advertising theme "Delicious and Healthful" was
then used over the next two decades. In 1926, Pepsi received its first logo redesign since the
original design of 1905. In the year 1929, the logo was changed again.
In 1931, at the depth of the Great Depression, the Pepsi-Cola Company entered bankruptcy - in
large part due to financial losses incurred by speculating on wildly fluctuating sugar prices as a
result of World War I. Assets were sold and Roy C. Megargel bought the Pepsi trademark. Eight
years later, the company went bankrupt again. Pepsi's assets were then purchased by Charles
Guth, the President of Loft Inc. Loft was a candy manufacturer with retail stores that contained
soda fountains. He sought to replace Coca-Cola at his stores' fountains after Coke refused to give
him a discount on syrup. Guth then had Loft's chemists reformulate the Pepsi-Cola syrup
formula.
During the Great Depression, Pepsi gained popularity following the introduction in 1936 of a 12-
ounce bottle. Initially priced at 10 cents, sales were slow, but when the price was slashed to five
cents, sales increased substantially. With a radio advertising campaign featuring the jingle
"Pepsi-Cola hits the spot / Twelve full ounces, that's a lot / twice as much for a nickel, too /
Pepsi-Cola is the drink for you," arranged in such a way that the jingle never ends. Pepsi
encouraged price-watching consumers to switch, obliquely referring to the Coca-Cola standard
of six ounces per bottle for the price of five cents (a nickel), instead of the 12 ounces Pepsi sold
at the same price. Coming at a time of economic crisis, the campaign succeeded in boosting

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Pepsi's status. In 1937 500,000,000 bottles of Pepsi were consumed. From 1936 to 1938, Pepsi-
Cola's profits doubled.
Pepsi's success under Guth came while the Loft Candy business was faltering. Since he had
initially used Loft's finances and facilities to establish the new Pepsi success, the near-bankrupt
Loft Company sued Guth for possession of the Pepsi-Cola company. A long legal battle, Guth v.
Loft, then ensued, with the case reaching the Delaware Supreme Court and ultimately ending in a
loss for Guth.

1.2. HISTORY OF PEPSI COLA PAKISTAN

The market in Pakistan is surely dominated by Pepsi. It has proven itself to be the No.1 soft drink
in Pakistan. Now days Pepsi is recognized as Pakistanis National drink. In 1971, first plant of
Pepsi was constructed in Multan, and from there after Pepsi is going higher and higher. Pepsi is
the choice soft drink of every one. It is consumed by all age groups because of its distinctive
taste. Compared with other Cola in the market, it is a bit sweeter and it contributes greatly to its
liking by all. Consumer’s survey results explain the same outcome and Pepsi has been declared
as the most wanted soft drink of Pakistan.

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2. MISSION AND VISSION

2.1. MISSION STATEMENT:

“To be the world's premier consumer Products Company focused on convenient foods and
beverages. We seek to produce healthy financial rewards to investors as we provide opportunities
for growth and enrichment to our employees, our business partners and the communities in
which we operate. And in everything we do, we strive for honesty, fairness and integrity.”

2.2. VISION STATEMENT:

“To be the world's best beverage company”, Being the best means providing outstanding quality,
service, cleanliness and value, so that their every customer is contented and happy with their
products.”

“To increase the value of their shareholder’s investment through sales growth, cost control and
wise investment of resources.”

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3. COMPANY PROFILE:

Founded in Newbern, North Caralina USA (1965)

Founders: Donald Kendall, Herman Lay
Establishment in Pakistan: 1968
Headquarters in Pakistan: Lahore
Total Employees: 103
Sales: 6.179794 million (USD)
Products in Pakistan: Pepsi, Mirinda, Teem, 7UP, Mountain Dew, Diet 7UP, Diet Pepsi, Lays,
Kurkure, Aquafina, Tropicana, Nimbooz, Gatorade, Slice.

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4. PRODUCT DESCRIPTION:

The soft drinks market in Pakistan enjoys dynamic growth in both volume and value terms.
Carbonated drinks have become part of the culture in Pakistan and multinational companies have
maintained standards over the years to provide the nation with high-quality drinks. Rural areas of
Pakistan have driven sales of carbonated drinks to new heights as more than 60 percent of the
population resides in rural areas and young consumers are more attracted to advertising. Pepsi is
the most popular and leader brand in the Pakistani market and is consumed by children and
adults alike. Pepsi is a responsible corporate brand of Pakistan and have contributed a lot to the
economy.
In marketing, a product is anything that can be offered to a market that might satisfy a want or
need. Until unless, the product of the company is not strong in the market, it cannot survive in
the long run.
Pepsi has a product line comprised up of carbohydrate drinks, Lays and many other products in
Pakistan. Pepsi’s product line satisfies consumer needs because Pepsi produces different types of
soft drinks for different consumers.
The most popular product of Pepsi is Pepsi Cola. Due to its good taste Pepsi is a well-known
product. Thus Pepsi Cola satisfies the consumer’s needs efficiently by launching a desired
product.　

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5. KEY CUSTOMER MARKETS:

Pepsi believes in building long term relationship with its customers therefore it strives
o To deliver best possible value to its customers &
o It never compromises on quality.

At all the major bottlers’ compounds in Pakistan there is at least one quality control personnel
present. Bottlers of the Pepsi International also are always ready to pass on benefits to the
customers in shape of price deals, packaged deals and discounts.

5.1. PACKAGING:

“Packaging is a part of product planning in which a firm researchers, designs, and produces its
packaging.”
The physical container may be a cardboard, metal, plastic or wooden box; a cellophane, wax
paper, or cloth wrapper; a glass, aluminum, or plastic jar or can; a paper bag; story foam; some
other material; or a combination of these products frequently have more than one physical
container. But packaging depends upon the product nature as well as structure means either it is
liquid, semi liquid or solid.
In case of Pepsi Cola, they take the packaging designs by considering what is better for company
and what is better or convenient for the transportation. For protecting the syrup, Pepsi Cola uses
the glass as well as plastic bottles of different quantity.
The variants that are offered by Pepsi in terms of size and quantity,
o 250 ml Regular Bottle
o 300 ml Tin
o 1000 ml Regular Liter Bottle
o 1500 ml Disposable Bottle
o 2000 ml Jumbo Bottle

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6. TARGET MARKET:

The primary target group of PepsiCo for its Pepsi line of products are people in the age group of
13-34. It also targets people that are athletes and overweight (PepsiCo 2010). Pepsi has a
distinctive style of portraying times in their ad campaigns. Their ‘Generation Next’ campaign
suggested that Pepsi is not just a drink for the next generation but that its drinkers are a
generation ahead of their counterparts (PepsiCo 2009). Pepsi has products that target the
different cultural and regional aspects of a particular country. It has products such as Nimbooz
by 7UP in Pakistan.

6.1. POSITIONING:

Since the acquisition of Tropicana and Gatorade and manufacturing its own brand of bottled
water. Pepsi is now heavily inclined to developing healthy food alternatives. This has positioned
them strategically in a niche market that is growing fast.

6.2. SEGMENTATION

Market segmentation of the company Pepsi is divided into following categories:

1. GEOGRAPHIC SEGMENTATION
The company of Pepsi is used to segment the market of the product geographically, by forcing
their market attention towards the urban areas in the hot summer days because people are
interested in getting a good reasonable drink, which gives them pleasure and reduces their thirst.
They have their dealers in different places in the urban areas to capture the market in order to
find and satisfy their customers.

2. DEMOGRAPHIC SEGMENTATION
First of all the company considers everyone young in the market because they consider 5 years
old boy as young and 70 years old man as young because they think that no one in the world
consider himself as an aged person but the company in some cases focuses their market and
segments their market up to the age of 5 to 45, because people above 45 are hesitant of drinking
peps due to its coolness and its sugar facts. People in between the age of 5 to 45 are usually
attracted towards the drink Pepsi due to its flavor and reputation in the market.

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The company also made area wise segmentation and usually moves towards college, cinemas,
restraints, hotels, where the strength of young people are greater. The company also focuses
towards students of colleges and schools.

3. PSYCHOGRAPHIC SEGMENTATION
The company also segments its market with respect to social class, lifestyle and personalities.
They focuses their attention towards lower upper and middle class because those people afford to
drink Pepsi.

4. BEHAVIORAL SEGMENTATION
Behavioral segmentation is benefits, occasions, brand loyalty etc. the company tries to market
their product for the occasions like wedding, concerts and sports events. Now a days the demand
of Pepsi has increased due to the wedding ceremonies. So the company tries to attract the
customers in such metropolitan areas. It also focuses towards the brand loyal people of the
market who heavily drink Pepsi and those who are in colleges and universities.

MARKET SEGMENTATION OF PEPSI IN PAKISTAN

SEGMENTATION CATEGORY

GEOGRAPHIC
Region All over Pakistan
Population density Mainly urban as well as rural
Climate Mainly in hot days
DEMOGRAPHIC
Age 2-65
Gender Male, Female
Occupation Mainly students and youngsters
Education Universities, colleges, schools
PSYCHOGRAPHIC
Social class Higher and lower middle class, working
Life style Strives and straggles
Personality Ambitious, adventurous, active
BEHAVIORAL
Occasions Regular and special
Benefits Good quality and service
User status Regular user
Usage rate Medium and heavy user strong and medium user
Loyalty status Interested, desired and intending to buy
Readiness stage Positive and enthusiastic
Attitude towards product

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7. MARKETING CHANNELS:

Its marketing planning is based on following:

o On long term business objectives
o Past trends & future projections.

In Karachi which is divided into 10 marketing zones. Each zone is evaluated for the sales
potential and are given the respective quotas for next period. The zone covering all educational
institutions in Karachi has one of the highest sales target for the potential it has.
In Pakistan Pepsi is the most liked soft drink especially by young generation so the Pepsi cola
company has devised such marketing strategy which attracted them. For this reason they started
monitoring the habits of the generation. What they saw was that the students were crazy about
cricket and usually liked to idealize them so in order to increase their sales the Pepsi cola
company paid high amounts of money to the cricketers to act as their spokes men.
Some of the most famous cricketers in the modern era have acted as spoke persons also film stars
have been acting as spoke persons.
The Pepsi cola company has after doing research also has introduced different size of bottles
offered at lower prices so that everyone can afford them. Also Pepsi Company has introduced
other soft drinks including Mountain Dew, Seven Up and Miranda. Pepsi company has
introduced other flavors such as Pepsi twist, Pepsi max diet Pepsi.
Pepsi Cola Company has also become official sponsors of Pakistan cricket and has sponsored a
number of series.
Also Pepsi has donated a lot to the earth quake victims and has launched a number of prize
schemes to attract new customers
As a result of this marketing strategy Pepsi has become the largest seller of soft drinks in
Pakistan and is slowly forming a monopoly in drinks market. Although many soft drinks like
Pepsi have been introduced such as Amrit Cola, RC Cola offered at lower prices but none of
these drinks have been able replace it.
Frequency of the Pepsi ads varies from time to time. When the season is on Pepsi do heavy
advertisement especially in Ramzan days or Eid occasions but this advertisement not remain
consist. We can hardly see the ads of Pepsi now as there is winter season.

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8. CORE COMPENTANCIES:

Following are the key core competencies of Pepsi Pakistan.

8.1. STRONG MARKETING:

Pepsi cola have strong marketing campaign in Pakistan. They are doing 360’ marketing
campaign for the awareness of their each product. They have different promotional campaigns
for different products. They are also using brand ambassadors in their advertisement that creates
positive image and strong loyalty with the product.

8.2. STRONG COMMITED EMPLOYEES:

Pepsi cola have committed employees who gave them the best output and loyal with the
company and this is because of motivation from the company. One of the main reasons of the
loyalty with the company is incentives and benefits given by the Pepsi cola to its employees for
their betterment. And due to these benefit to the employee can’t switch to any other company.
Empowerment is also the main reason for commitment with the company.

8.3. DECENTRALIZED IN DECISION MAKING:

Decision making system in Pepsi cola is decentralized the decisions are made on top level
management but management also involved the middle line and front line management as well in
their decision.

8.4. FINANCIALLY STRONG:

Pepsi cola is financially strong company they have the potential for more growth and they can
enhance their product line.

8.5. DOMINANT MARKET SHARE:

Pepsi cola have 72% dominant market share in the Pakistan as compare to its direct competitors
like coca cola. And still the company is working for capturing the more market share.

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8.6. TARGET MARKET:
This is also one of the reasons in the success of the Pepsi cola. Pepsi cola is doing mass
marketing in the Pakistan they are hitting all types of customers and filling the demand of every
type of customer.

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9. STRATEGIC BUSINESS UNITS:

The different strategic business units i.e. SBU’s of Pepsi in Pakistan are:
1. Frito-Lay Brands
2. Pepsi-Cola Brands
3. Gatorade Brands
4. Tropicana Brands
5. Quaker Brands

9.1. FRITO-LAY BRANDS:

Lay’s potato chips, Baked lays potato chips, Wavy lays potato chips, Cheetos, Doritos etc.

9.2. PEPSI-COLA BRANDS:

Pepsi cola, Diet Pepsi, Mountain Dew, Slice, 7UP, Diet 7up, Crush, Aquafina etc.

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9.3. GATORADE BRANDS:
Gatorade thirst, Gatorade ice thirst quencher, Gatorade energy bar etc.

9.4. TROPICANA BRANDS:

Tropicana pure premium, Tropicana season’s best juices, Tropicana twister, Tropicana smoothies
etc.

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10. COMPETITORS:

The competitors of Pepsi are given bellow:

10.1. DIRECT COMPETITORS:

The primary competitors of Pepsi are coco cola and RC cola. These competitors are very strong
and powerful in the market due to their huge market shares and customer satisfactions. And there
is a big challenge for Pepsi to take over the direct competitors.
o Coca Cola
o RC Cola

10.2. INDIRECT COMPETITORS:

o Juices
o energy drinks
o Tea and coffee
o Mineral water

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11. MARKET SHARE OF COMPANY:

When Pepsi was introduced in Pakistan, it faced fierce competition with 7up, lemon and lime
drinks, which was established during 1968, in Multan. Pepsi introduced its lemon and lime,
"Teem" to compete with 7up. It successfully, after some years, took over 7up, and this enhanced
Pepsi's profits and market share. In Pakistan, Pepsi with 7up enjoys 70% of the market share
whereas the coke just has 20% markets share.
Pepsi is operating in Pakistan, through its 12 bottlers all over Pakistan. These bottlers are Pepsi's
strength. Pepsi has given franchise to these bottlers. Bottlers, produce, distribute and help in
promoting the brand.

12. MARKET SHARE OF COMPETITOR:

Comparing the result to its competitors, Pepsi reported total revenue decrease in the 4 quarter of
2019 by -11.96% faster than overall decrease of Pepsi’s competitors by -6.58%, recorded in the
same quarter.

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13. MARKETING ALLIANCES:

Marketing alliances are the strategic form of marketing that a company uses with the alliance of
another company, so they can market themselves and it results in a win-win situation for both of
the companies. In case of Pepsi, in Pakistan Pepsi allied with the following in order to get market
response in a positive way.
o Pepsi gets alliances with the lays company so they can grab each other’s market.
o Pepsi gets alliance with Cinepax cinema so the cinema only provides Pepsi for the
audience.
o Pepsi gets alliance with different restraints like burger lab, KFC so they only sell Pepsi on
their outlets.

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14. MARKETING RESEARCH:

Pepsi Cola was first made in the 1893 by pharmacist Caleb Bradham in New Bern, North
Carolina. Initially Pepsi was introduced as “Brads Drink” by Bradham in 1898 and was made at
Braham’s pharmacy where the drink was also sold. Later, Bradham changed its named to Pepsi
Cola, due to the enzyme pepsin and kola nuts used in the recipe. In 1903 “Pepsi-Cola” was
officially registered with the U.S. Patent Office. Today Pepsi Cola is manufactured by PepsiCo.
PepsiCo is a world leader in convenient snacks, foods and beverages. Currently PepsiCo is the
number 2 manufacturer in soft drinks behind Coca Cola, number one in snacks and number one
in juices. PepsiCo has revenues of $40 billion a year with beverages contributing to less than
50% of that revenue.

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15. SOCIAL CLASS FOR PRODUCTS:

A consumer’s behavior also is influenced by social factors, such as the Groups, Family, Roles
and status. Groups are two or more people who interact to accomplish individual or mutual
goals. A person’s behaviors are influenced by many small groups. Groups that have a direct
influence and to which a person belongs are called membership groups. Some are primary
groups includes family, friends, neighbors and coworkers. Some are secondary groups, which are
more formal and have less regular interaction.

These include organizations like religious groups, professional association and trade unions. For
groups, it is much easier for Pepsi to attract them to buy their products. Because a single member
of the groups can influences almost all the group member to follow them. For example, a leader
in one group can influenced the members to buy Pepsi as part of the group activities.

Family members can strongly influence buyer behavior. The family is the most important
consumer buying organization society and it has been researched extensively. Marketers are
interested in the roles, and influence of the husband, wife and children on the purchase of
different products and services. In this social class, Pepsi need to target the children because they
are the people who will consume more Pepsi. But of cause they will ask their parents to buy the
products. So Parents is the customer and Children is the consumer.

Roles and Status is a person belongs to many groups, family, clubs, organizations. The person’s
position in each group can be defined in terms of both role and status. For example, Mdm Airis
plays the role of Mother, in her family she plays the role of wife, and in her company, she plays
the role of manager. A Role consists of the activities people are expected to perform according to
the persons around them.

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16. PUSH AND PULL STRATEGY:

16.1. PUSH STRATEGY:

This company has done a fair job with push marketing strategy, where they have created a
website on Facebook and twitter accounts, while no pop up screens or marketing promotions
comes up while you are accessing your home page. Such tie ups with social media helps the
company to hold the clients and increase the sales.

16.2. PULL STRATEGY:

Pepsis target audience ranges from 18 to 35yrs (Derriken, 2013) so therefore the company uses
young and vibrant colors to attract the audience. As far as pull strategy goes they have advertised
about their products in almost every sites, promotional hoardings or posters can be found in
almost every public places. In addition to this, Pepsi gives bulk discounts furthermore attracting
the consumers. According to integrating marketing communication agencies, a pull strategy
motivates the customers to actively seek out a specific product.

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17. DIGITAL MARKETING:
Pepsi does digital marketing at its highest successful way, it markets its products through social
media, television ads, and not just ads, they even had a show known as PEPSI THE BATTLE OF
BANDS, which was a new trend for people and they enjoyed the show very much.
Every successful ad works because it makes an effective appeal on its audience. Pepsi usually
uses emotional appeals, but depending upon the market conditions, sometimes uses logical
appeals.
Following are some appeals used by Pepsi in their digital advertisements.
1. PRICE OR VALUE APPEAL
Promoting to give buyers more of their money is one of the most effective appeal that can be
used, practically in terms of audience recall. A value appeal can be accomplished in several ways
lowering the price and making people aware of the new price, keeping the price the same but
offering more. Or keeping the price and the product same and trying to convince people that the
product is worth whatever price the company charges.

2. STAR/TESTIMONALS APPEAL
Pepsi uses star appeals to attract its customer as it used so many cricket celebrities to play part in
their ads, and not just cricket celebs but also influencers and big celebrities that have a great
amount of followers and fans watching them.

3. SENSORY APPEAL
Many ads work on the senses of a human, like when we see a Pepsi ad, then the ads in which it is
pouring in glass filled with ice, a sudden urge of thirst comes to your mind and you want to grab
that glass, so this is basically their sensory appeal used in the ads.

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18. BENEFITS:

18.1. STRONG BRAND NAME:

As the “PEPSI” it is a strong brand name. Whenever the customers feel thirst he/she always
think about the PEPSI not even the beverage, Which makes the Pepsi brand name as a stronger
brand name this is the reason that Pepsi gets the advantage of Word of mouth advertisement as
well which ultimately raise the sales of Pepsi.

18.2. ECONOMY:

The price which makes the product to be accessible to the final customer. Now days it is better to
have soft drink which is available in the shape of packed bottles and cans. People prefer to have
economical product to be taken as a drink that is the reason Pepsi taking the advantage of Unique
Selling Point.

18.3. CONVENIENCE:

Pepsi is available to everywhere, any store or any food restaurant this is the thing which make
the product convenience to the customer which is an Ups point as well for the company.

18.4. HEALTH MEASURES:

As the Pepsi is always found of having more and more customers in hand that’s why company
has launches the Pepsi Max (without sugar) to fulfill the demand and retain the health conscious
people .which is again a unique selling point for Pepsi.

18.5. TASTE:

The taste of the product is attractive to all, like any child, young, married or old every one like
the taste of Pepsi which we can say it fits to all.

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18.6. ADDICTION:

One more and huge unique selling point can be the addiction of the people that they need the
Pepsi with mostly their all the meals, especially children. They are found of having Pepsi with
them all the time.

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19. PRODUCT FEATURES:

At every level of Pepsi Company, they take great care to ensure that the highest standards are
met in everything they do. In their products, packaging, marketing and advertising, they strive
for excellence. Their manufacturing and bottle processing, strict quality controls are followed to
ensure that the product meets the same high standards of quality.
All ingredients are listed on the label in order of decreasing amount. Pepsi products contain
natural flavors, including extracts of kola nut, vanilla beans and flavor oils derived from natural
resources such as citrus and other fruits.
They also put a freshness date on every can and bottle. Soft drinks may lose flavor over time so
their freshness date tells the customer when the product is fresh and best tasting.

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20. PRICING STRATEGY:

The amounts of money charged for a product or service, or sum of the values that consumers
exchange for the benefits of having or using the product or services. As price gives us the profit
so this P is very important for business price of product should be that which gives maximum
benefit to the company and which gives maximum satisfaction to the customer.
Following factors Pepsi kept in mind while determining the pricing strategy.
o Price should be set according to the product demand of public.
o Price should be that which gives the company maximum revenue.
o Price should not be too low or too high than the price competitor is charging.
o Price must be keeping the view of your target market.
o The price of Pepsi Cola, despite being market leader is the same as that of its
competitor Coca cola.
o Sometimes, Pepsi places its customers into some psychological pricing strategies
by reducing a high priced bottle and consumers think that they save a lot of
money from this.

20.1. Prices of Different Bottles

1. Regular bottle e= rupees 18

2. Non-Returnable/disposable= rupees 45
3. Liter Bottle=rupees 70
4. 1.5 Liter Bottle= rupees 90
5. 2 Liter Bottle= rupees 105

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20.2. DISCOUNTS:

Pepsi Cola offers various discounts to those retailers who have the maximum sales of Pepsi
products on daily, monthly and on seasonal basis. Some of the main discounts given to the
retailers.
Following are discounts offered by Pepsi.
 1/10 Discount
For Instance one case of Pepsi is free on buying 10 cases of Pepsi at one time.
 2/20 Discount
For Instance two cases of Pepsi are free on buying 20 cases of Pepsi at one time.
 Seasonal Discount
Pepsi also offers seasonal discounts schemes by reducing price in Ramadan and on Eid.
Pepsi also offers trade in allowance for retailers.

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21. DISTRIBUTION STRATEGY:

The distribution system of Pepsi Company is organized as follow, there are branches in every
city of Pakistan and these branches are controlled by the head of branches which is located in
Karachi. There is some sales manager and sales executives. The sale executive is also known as
territory development manager who is responsible about the trucks. Then further down is the
sales officer who has a wide authority and then there is sales supervisor who looks after the
trucks and finally salesman. Each sales manager handles 60 trucks. The distribution agencies are
formed in every large city of Pakistan. These trucks supplies the products to the retailers. Before
delivering the products some certain guiding is to be followed:
o Applicants must have 20-25 vehicles
o Applicant must have 20,000 cases of empty bottles
o Applicants must deposit 1,000,000 PKR as security.

To every company the mode of distribution should be strong for the success of that company,
Pepsi knows that very well, therefore the company applies two modes of distribution strategies,
i.e. direct distribution and indirect distribution.

21.1. DIRECT DISTRIBUTION:

Pepsi distributes their products to whole sellers, Hotels, Restraints like, Pizza hut, KFC, Saver
foods, Metro etc.

21.2. INDIRECT DISTRIBUTION:

Through base market distributions and through outstation distributions, like super marts, super
stores like Imtiaz super market, Naheed etc.

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22. SWOT ANALYSIS:

SWOT Analysis, which is based on thorough review of the business (corporation, product
category competition, customers and products), identities and evaluates the internal strengths and
weakness of the companies well as its external threats and opportunities. The marketing mix is
driven by the results of the SWOT analysis.

22.1. STRENGTHS:

o Demand of Pepsi is more than its competitors.

o Company has a very established name and a good reputation.
o Pepsi has large market share than its competitors.
o As the target customers of Pepsi is young generation, so Pepsi has more brand loyal
customers.
o Most of the customers are satisfied with the price of the Pepsi.
o Pepsi is an international company and it has a very strong position internationally.
o The environment of factory is very good and attractive.
o Pepsi spends a lot of budget on its advertising.
o Pepsi has a very vast distribution channel and it is easily available everywhere.
o Employees are also motivated.
o Pepsi offers many discount schemes for customers time to time.
o Pepsi Cola is sponsoring sports, musical concerts, walks.
o The location of the Pepsi plant is utilized that all major markets of Lahore are within the
reach of the Pepsi plant within 30-45 minutes.

22.2. WEAKNESSES:

o Pepsi does not offer any sort of incentive or discount to its retailers.
o Pepsi target only young customers in their promotions.
o Crown of the disposable bottle is not good.
o Demand of disposal bottle is declining.
o Pepsi tin pack is not available in far off rural areas.
o Pepsi is not considering many potential outlets like hotels, college canteens etc.  

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22.3. OPPORTUNITIES:

o Company may start entering rural areas also.

o The company may also diversify its business in some other potential business.
o Increased interest of people in musical groups, cultural shows and sports has provided
an opportunity for Pepsi to increase its sales through them.

22.4. THREATS:

o The main competitor of the company is the Coca Cola.

o At the international level, Pepsi has a very strong competition with Coke. Coke has
started its advertisements more effectively to increase their demand and it is a very
strong threat for Pepsi.
o Cola drinks are not good for the health so the awareness level of the people is
increasing which is a big threat to the company.

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23. GOALS OF THE COMPANY PER YEAR:

The goals of the company are discussed by the company as:

At Pepsi, we believe that there is an opportunity to change how the world produces, distributes,
consumes and disposes of foods and beverages in order to tackle the shared challenges we face.
We aim to use our scale, reach and expertise to help build a more sustainable food system; one
that can meet human needs for nutrition and enjoyment, and continue to drive economic and
social development, without exceeding the natural boundaries of the planet.

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24. THREATS FROM NEW ENTRANTS:

Potential entry of new competitor is easy but threat from new entrant is low because no one can
reached on the competition of Pepsi cola as well as company have strong market share that is
72% ,strong brand name, strong distribution an huge setup in Pakistan and no one can easily
achieve this.
Pepsi has many substitute products that create the high threat for company like juices, flavored
milk and energy drinks in the market. Now a day’s people are switching on non-carbonated
drinks and that is the big threat for Pepsi cola.

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25. LINE EXTENSION:

Line extension refers to the expansion of an existing product line. For instance, a soft drink
manufacturer might introduce a "Diet" or "Cherry" variety to its cola line, while a toy
manufacturer might introduce new characters or accessories in its line of action figures. In short,
line extension adds variety to its existing product for the sake of reaching a more diverse
customer base and enticing existing customers with new options.

Beverages Water Snacks Juices

Pepsi Aquafina Kurkure Tropicana

Teem Cheetos Nimbooz
Mirinda Lays Slice
7-UP
Mountain Dew
Diet Pepsi
Gatorade

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26. BRAND/CATEGORY EXTENSION:

Brand extension refers to the expansion of the brand itself into new territories or markets. For
instance, if a soft drink manufacturer unveils a line of juices or bottled water products under its
company name, this would constitute an example of brand extension. The brand, or company, is
an established name, and so the name alone can serve to drive customers to try new products
completely unrelated to the older product lines.
In case of Pepsi, its brand extension is Aquafina, Tropicana etc.

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27. MARKETING PROMOTIONS PER SEASON/FESTIVALS:

In Pakistan Pepsi is the most liked soft drink especially by young generation so the Pepsi cola
company has devised such marketing strategy which attracted them. For this reason they started
monitoring the habits of the generation. What they saw was that the students were crazy about
cricket and usually liked to idealize them so in order to increase their sales the Pepsi cola
company paid high amounts of money to the cricketers to act as their spokes men.
Some of the most famous cricketers in the modern era have acted as spoke persons also film stars
have been acting as spoke persons.
The Pepsi cola company has after doing research also has introduced different size of bottles
offered at lower prices so that everyone can afford them. Also Pepsi Company has introduced
other soft drinks including Mountain Dew, Seven Up and Mirinda. Pepsi company has
introduced other flavors such as Pepsi twist, Pepsi max diet Pepsi.
Pepsi Cola Company has also become official sponsors of Pakistan cricket and has sponsored a
number of series.
Also Pepsi has donated a lot to the earth quake victims and has launched a number of prize
schemes to attract new customers
As a result of this marketing strategy Pepsi has become the largest seller of soft drinks in
Pakistan and is slowly forming a monopoly in drinks market. Although many soft drinks like
Pepsi have been introduced such as Amrit Cola, RC Cola offered at lower prices but none of
these drinks have been able replace it.
Pepsi has a strong grip on Marketing promotion & making better day by day specially on season
festivals like Ramadan is on head so they offering discounts &there promotional campaign has
also run in many malls.

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28. PEST ANALYSIS:

28.1. POLITICAL INFLUENCE:

o POLITICAL STABILITY:
Whenever the government is considered to be stable, the business will flourish. If there is
political stability in the country the policies and strategies made by Pepsi can be consistent to be
implemented. Foreign companies are also keen to invest in those countries which are politically
stable where they have no fear of decline in their market share or shut down due to sudden
change of government.
o MIXED ECONOMY:
In mixed economy government and private sector both plays their role in developing the
economy of the country. Investment by foreign companies like Pepsi is more likely to flourish in
mixed economy.　
 
o LAWS FOMULATION:
Government has given copy rights to Pepsi so that another company cannot sell their product by
the name of Pepsi. The countries where laws are formulated, the strategies and activities of the
company are different.

28.2. ECONOMIAL INFLUENCES:

o INCOME AND INCOME PER CAPITA:

If the income level or per capita income of the people increases, it will have a positive Effect on
the consumption of Pepsi.
o INFLATION:
If the country faces inflationary trend in the market, the price of the Pepsi will ultimately
increase which will lower its demand.
o CONSUMPTION BEHAVIOR:
Pakistan is a consumption oriented society. Due to demonstration effect the people are more
inclined towards consumption than saving. So the people of Pakistan spent heavily on food
items. Hence Pepsi has a good market share in the present circumstances.
o INCOME DISTRIBUTION:
It means how much is in the hands of rich and poor class. In Pakistan 10% rich people possess
93% of wealth and 90% people possess 7% of wealth. If there is balanced distribution of income

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in the country, the consumption of the people will increase hence increasing the sales of
beverages as well.
o EMPLOYMENT OPPORTUNITIES:
As employment opportunities increase the living standard of the people increase and the people
consume more.
o AGGREGATE DEMAND:
In case of Pepsi, aggregate demand of the product increases in the season of summer as the hot
weather makes the consumers want to drink more.
o AGGREGATE SUPPLY:
In summer season to cope up with the increasing demand they have to increase the aggregate
supply of their product.
 
o ECONOMIC POLICIES:
Some of the economic policies which can affect the market of Pepsi are discussed below:
 Fiscal Policy
It is the policy of taxes. If heavy tax is levied on Pepsi then its price
will rise having negative effect on its consumption.
 Monetary Policy
Monetary policy is made to restrict or increase the supply of money in the market. If
policies are made to restrict the flow of money in the market, inflation can be controlled
hence increasing the real income of the people which will ultimately affect the
consumption of Pepsi.
 Price Policy
If price of Pepsi is increased its demand will decrease and vice versa.
 Income Policy
If income of the people will increase their purchasing power will
increase and hence increasing the market share of Pepsi?

28.3. SOCIO-CUTURAL INFLUENCES:

o PSYCHOGRAPHIC
It is a combination of demographic and psychological factors. Psychological attributes mean how
you perceive things. The company will focus on the behavior of consumers and make different
changes in their product quantity or quality and in promoting their product so that they can

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attract the customers. Keeping in view that the behavior of different consumers is not alike they
have to make their marketing strategies in accordance with their requirements so that they are
convinced to buy the product.
o SOCIAL STATUS:
Pepsi is a well renowned brand. People who are brand conscious will not drink beverages of
lesser known brands such as Amrit cola. They will try to show their status by drinking Pepsi
which is known to all as a quality drink.
o MEDIA:
It is a very important factor for marketing. Media these days is a very effective way of
inspiring people to buy a specific product. A good promotion can boost up sales to a great
extent.

28.4. TECHNOLOGICAL INFLUENCES:

o RESEARCH AND DEVELOPMENT:

Through research and development quality of the product can be improved or better techniques
or machinery can be developed which can increase the production. When technology is advance
the supply of the product increase hence the company experiences growth in their business.

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29. FINANCIAL REPORTS:

The financial report of Pepsi Pakistan is given below:

Net Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 39,474
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,038
Selling, general and administrative expenses. . . . . . . . . . . . . . . . . . . . . . . . . 14,208
Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Operating Profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,170
Bottling equity income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 560
Interest expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (224)
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
Income before Income Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 7,631
Provision for Income Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,973
Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,658
Net Income per Common Share
Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3.48
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3.41

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30. CONCLUSION:

Pepsi is a well renowned company and it has maintained its position well by understanding the
client psychology, by ensuring quality, by introducing ingenuity in products, by enlarging its
product base, by keeping economic factors in view and by intense and jazzy advertisements.
Whenever and where ever there is a spotlight event, Pepsi must figure in, like the one day
international cricket matches between India and Pakistan many other such occasions. The key
word for success in the Marketing World is to “remain in the spotlight” and that is what Pepsi is
doing.
Pepsi has enough resources and finance to enhance the product line aggressively in Pakistan as
well. But in-stable economic, political and security conditions is Pakistan are a big hurdle in
making bigger investments in Pakistan.
To overcome these problems government of Pakistan should take some initiatives to boost up the
industrial sector.
Another internal factor which is an obstacle to enhancement of the business is high operating
cost of production which makes company bound to minimize its profit margin.

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