Segmentation

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Market Segmentation Of Pepsi At An International Level
The history of Pepsi-Cola starts in 1896 in the town of New Bern in North Carolina, USA in a drugstore owned by the pharmacist Caleb Bradham. He came up with many recipes of new drinks to be served at the soda fountain of his drugstore. Brad ham aim was to create a drink both delicious, healthy, aiding digestion and boosting energy. It would be free of impurities and it should not contain any strong narcotics. Eventually one of his drinks became very popular and the customers started to call it Brad’s drink. This was the beginning of Pepsi-Cola’s story and later, Brad ham’s vision was turned into a mission for the future company. In 1905 Pepsi started with bottling franchises and registered its trademark in Canada and Mexico in 1908. At the same time the U.S. government enacted the Pure Food and Drug Act prohibiting substances such as arsenic, barium, uranium, etc. in food and beverages. Consequently, many soft drink manufacturers, including Coca-Cola, had to change their formulas. Pepsi exploited the situation against their main competitor Coca-Cola, by claiming that they already met federal requirements. Distribution was modernized with motor vehicles and started to promote its products using famous public figures like Barney Olfield, an automobile race pioneer who endorsed Pepsi. In the 1920’s and 1930’s the company experienced financial difficulties and went bankrupt twice in 1923 and 1931. In 1931 the company was sold and Charles G. Guth took over the presidency commanding a reformulation of the syrup recipe. Few years later Walter S. Mack, Jr. was elected president and the company became a modern marketing company by using comic strips and Hollywood movie stars to advertise its products. In 1959 Pepsi entered the former Soviet market in Moscow and acquired Mountain Dew in 1963 making it the second best selling drink ever produced by the company.

The Emergence of a Global Company
In 1965, the company expanded and grew significantly through the merger of Pepsi-Cola, operating in the beverage industry and Frito-Lay in the snack food sector. The following year, the newly formed PepsiCo entered the Japanese and Eastern European markets. In 1974 Pepsi opened its first production plant in U.S.S.R. and was the largest soft drink selling brand in American supermarkets. Afterward, PepsiCo substantially diversified its portfolio by acquiring Pizza Hut, Taco Bell and formed PepsiCo Food Service International (PFSI) to focus on overseas development of restaurants. In 1980 PepsiCo signed a joint venture agreement with the Chinese authorities but the project was never developed properly. Then Pepsi became the indisputable number one in the soft drinks industry with revenues of $7,5 billion and more than 137 000 employees. The company was seen as a leader in advertising when they used a space station for promotional events. In 1986 the corporation was reorganized and decentralized by transferring its beverage operations under PepsiCo Worldwide beverages and the snack food sector under PepsiCo World wide Foods. In 1996 Pepsi entered the Internet “boom” by creating an ambitious “worldwide” web site surpassing all expectations and was copied in numerous ways. Subsequently, the company converted its bottling sector into a publicly traded company, the Pepsi Bottling Group (PDG). In August 2000 the company was involved in one of the most significant transaction in the beverage and food industry through its merger with Quaker Oats and the addition of top products to its portfolio such as Gatorade beverages. Recently, Pepsi made the headlines by signing a “skyrocketing” agreement with Britney Spears to promote its new marketing campaign and products.

Observations throughout History
Pepsi-Cola is still second in the carbonated drinks market and remains in the shadow of Coca Cola in terms of market share, perception and image. However, Pepsi’s insightful marketing techniques...
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