Pepsi - India Entry Strategy

Topics: Pepsi, PepsiCo, Coca-Cola Pages: 22 (7717 words) Published: October 31, 2010
Term Case Assignment:PEPSICO , India|
Submitted to: Dr Amar KJR Nayak|

Term 4, Strategy Management (STM) Submitted by- Group 8, Section YAditya Agarwal (u109102)Anand Bardhan (u109105)Binay Prasanna Jena (u109110)Biswajit Ku Mahapatra (u109111)Chiranjit Mandhata (u109112)Binsamou Christopher (u109184)|

Origin and History2
Company Background (Pepsico India)3
Product Lines in India4
Business Channels5
Porter’s Five Forces Analysis6
Value Delivery Process8
Pepsi’s Value Delivery8
Value Chain Analysis9
Pepsico: India Story10
Entry into India10
Pepsi: Pre Liberalization & Early ‘90s13
Pepsico in the post-Coke Re-entry Era15
Advertising Strategy17

Origin and History

Pepsico formally known as Pepsi Cola Company was formed in the year 1898 in New Bern, North Carolina in the United States of America just 12 year after its most famous rival Coca Cola was formed. It was started by a NC Pharmist and Industrialist Caleb Bradham. It was first introduced as ‘’Brad’s Drink’’ in New Bern, North Carolina by Caleb Bradham who made it at his pharmacy where the drink was sold. Later it was renamed as Pepsi Cola, possibly due to the digestive enzyme pepsin and kola nuts used in recipe. The brand was trademarked under the name of Pepsi first on June 16 1903. In 1909 automobile race pioneer Barney Oldfield was the first celebrity to endorse Pepsi Cola. The advertising theme ‘Delicious and Healthful’ was then used over the next two decades. In 1926, Pepsi received its first logo redesign since the first original design of 1905. In 1929 the design though was changed again to modify its image among the public. In 1931 Pepsi Cola faced its first major problem at the depth of Great Depression , When Pepsi Cola entered bankruptcy 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. 8 years later Pepsi Cola again went bankrupt and was bailed out Charles Guth. Though this became the precise period in which Pepsi Cola started gaining popularity with targeting its audience through radio advertisement and started giving its competitor Coca Cola a tough time. Nickolas Dias was named the new president of Pepsi Cola and he guided the company through his own strategies during the 1940’s.His strategy included targeting the largely untapped market of African American and thus by targeting them getting a whole new set customers to the Business. Pepsi cola merged with Frito lays in the year 1965 and came to be known as Pepsico and in that form in which it is still continuing. In 1970, Pepsico sales crossed $ 1 billion mark in sales making it one of the first companies to achieve this feat internationally. In 1975, Pepsi once again proved that it was pioneer in marketing products. Pepsi introduced one of the unique marketing strategies which would revolutionize the way marketing of product was done. Pepsi Introduced the Pepsi challenge a marketing campaign where Pepsico set up a blind tasting between Pepsi-Cola and rival Coca Cola. During these Blind taste tests most of the participants picked Pepsi as the better of the two soft drinks. Pepsico took great advantage of it to boost it sales and flooded the advertisement market with the results of this test. Gradually Pepsico also owned up brands such as Frito lays, Quaker oats , Gatorade, SoBe, Tropicana, Copella, Mountain Dew, Mirinda ,7 UP, Cheetos , Lipton, Walkers, Amp, Sun Chips, Ethos water and Sabritas to name a few. Today Pepsico though is primarily associated with beverage distribution and bottling of carbonated and non carbonated drinks, but has also invested with success in segments such as salty sweet and cereal based snacks and also in health drink market as these coming up of new brands suggest. Through the 1980’s Pepsico entered the emerging markets of China (1982) and India...
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