Pepsico Case Study
1. What is PepsiCo’s corporate strategy? Briefly identify the business strategies that PepsiCo is using in each of its consumer business segments in 2008.
PepsiCo’s corporate strategy had diversified, in 2008, the company into salty and sweet snacks, soft drinks, orange juice, bottled water, and ready-to-eat drink teas and coffees, purified and functional waters, isotonic beverages, hot and ready-to-eat breakfast cereals, grain-based products, and breakfast condiments. Strategies that kept their brands at the top were tied to new product innovation, close relationships with distribution allies, international expansion, and strategic acquisitions. A new element of PepsiCo’s corporate strategy was product reformulations to make snack foods and beverages less unhealthy. Their belief that its efforts to develop “good-for-you” or “better-for-you” products would create growth opportunities from the intersection of business and public interests. The company was organized into four business divisions which all followed the corporation’s general strategic approach. Frito-Lay North America manufactured, marketed, and distributed such snack foods as Lay potato chips, Doritos tortilla chips, Cheetos cheese snacks, Fritos corn chips, Quaker Chewy granola bars, Grandma’s cookies, and Smartfood popcorn. The PepsiCo Beverages North America beverage manufactured, marketed, and sold beverage concentrates, fountain syrups, and finished goods under such brands as Pepsi, Gatorade, Tropicana, Lipton, Dole, and SoBe. PepsiCo International manufactured, marketed, and sold snacks and beverages in approximately 200 countries outside the United States. Quaker Foods North America manufactured and marketed cereals, rice, pasta dishes, and other food items that were sold in super markets. 2. What is your assessment of the long-term attractiveness of the industries represented in PepsiCo’s business portfolio? What is your assessment of the competitive strength of PepsiCo’s
PepsiCo’s corporate strategy had diversified, in 2008, the company into salty and sweet snacks, soft drinks, orange juice, bottled water, and ready-to-eat drink teas and coffees, purified and functional waters, isotonic beverages, hot and ready-to-eat breakfast cereals, grain-based products, and breakfast condiments. Strategies that kept their brands at the top were tied to new product innovation, close relationships with distribution allies, international expansion, and strategic acquisitions. A new element of PepsiCo’s corporate strategy was product reformulations to make snack foods and beverages less unhealthy. Their belief that its efforts to develop “good-for-you” or “better-for-you” products would create growth opportunities from the intersection of business and public interests. The company was organized into four business divisions which all followed the corporation’s general strategic approach. Frito-Lay North America manufactured, marketed, and distributed such snack foods as Lay potato chips, Doritos tortilla chips, Cheetos cheese snacks, Fritos corn chips, Quaker Chewy granola bars, Grandma’s cookies, and Smartfood popcorn. The PepsiCo Beverages North America beverage manufactured, marketed, and sold beverage concentrates, fountain syrups, and finished goods under such brands as Pepsi, Gatorade, Tropicana, Lipton, Dole, and SoBe. PepsiCo International manufactured, marketed, and sold snacks and beverages in approximately 200 countries outside the United States. Quaker Foods North America manufactured and marketed cereals, rice, pasta dishes, and other food items that were sold in super markets. 2. What is your assessment of the long-term attractiveness of the industries represented in PepsiCo’s business portfolio? What is your assessment of the competitive strength of PepsiCo’s