RQ: To what extent can PepsiCo use viral marketing for market entry to launch their new brand of biscuits into the Indian market?
1. BACKGROUND OF PEPSICO INDIA
PepsiCo re-entered India in 1989 and is headquartered at Gurgaon near New Delhi. Currently, PepsiCo India, has 19 different product lines that generate an annual revenue of $ 10 billion. The present product portfolio is as follows: Beverages * Iconic refreshment beverages: Pepsi, 7UP, Nimbooz, Mirinda, Mountain Dew * Low-calorie options: Diet Pepsi, Pepsi Max * Hydrating and nutritional beverages: Aquafina (drinking water), Gatorade (isotonic sports drink) * Fruit juices: Tropicana100% * Juice-based drinks: Tropicana Nectars, Tropicana Twister, Slice * Local brands: Lehar Evervess Soda, Dukes Lemonade, Mangola
| Foods * Lay's potato chips Doritos * Kurkure, Kurkure Desi Beats * Uncle Chipps, Cheetos extruded snacks (including Cheetos Whoosh made of whole grain and vegetables)PepsiCo markets its food brands in India under the label “Frito-Lays”
| Other Products * Quaker Oats (high-fibre breakfast cereal) * Traditional snacks under the Kurkure and Lehar brands * Low fat and roasted snack options
2.2 CURRENT TRENDS IN PEPSICO’S INDIA POLICY
In January 2011 the Chairman of PepsiCo India defined his vision for its growth in India. He said that the company in India will work under ‘Performance with a purpose’, which has four main thrust areas: (a) Replenishing water
(b) Partnering with farmers
(c) Converting waste to wealth
(d) Nurturing healthy kids
My research topic probably comes in the last thrust area, where the launch of healthy biscuits is one of the areas PepsiCo is working on.
1.2.1 Launching “Healthier” Products
PepsiCo is taking bigger steps now in improving its brand image as a food company that offers healthier choices to consumers. This new initiative comes under the “better-for-you” and “good-for-you” categories and, PepsiCo has a target of $30 billion from these products alone by 2020. There were two significant product launches recently in India under this category: (a) Lipton Ice Tea
Under a JV with Hindustan Unilever, PepsiCo has launched two new flavours, primarily for the urban market
(b) Launch of NourishCo with Tatas
In April 2011, PepsiCo launched a joint venture with Tata Global beverages to form NourishCo. Initially, NourishCo will launch Lehar Gluco Plus in Maharashtra for a pilot market study. PepsiCo believes that the name ‘TATA’ has enormous brand appeal amongst this target segment. Keeping these two objectives in mind, PepsiCo now wants to enter the healthy premium segment biscuit market, which is the focus area of my study. With internet penetration increasing in India (shown below), it would be useful to study if viral marketing could be used by Pepsi.
[source :http://itpopular.com/india-4th-top-country-worlds-highest-internet-usage/accessed on 30 June 2011] There are more than 23 million Facebook users alone on 31 March 2011, large multinationals like Pepsi could use viral marketing techniques to reach urban and rural markets. Therefore my RQ is “To what extent can PepsiCo use viral marketing for market entry to launch their new brand of biscuits into the Indian market?” METHODOLOGY AND PLANNING THE INVESTIGATION
2. COMPETITOR ANALYSIS : THE COOKIE – BISCUIT MARKET IN INDIA The term biscuits and cookies are used interchangeably in India, therefore throughout this essay, I will be using the term biscuits. 2.1 Size of the biscuit market. Industry estimates of the size of the biscuit market is Rupees 10,000 crores and, is estimated to grow at 15-17%. This is in the organized sector of biscuit manufacture which accounts for 65% of the total market – the unorganized sector accounts for the remaining 35%. 2.2. Structure of the biscuit market. The biscuit market is highly fragmented with several international...
Please join StudyMode to read the full document