Essay, Research Paper: Pepsi Marketing Mix


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Contributing to this industrial revolution among other industries were
Manufacturing, Agricultural, Automotive, Chemical, Hotel, Banking Business
Services, Real estate, Tourism and information Technology to name a few. But on
such industry that has been holding onto its share of the market since its
inception note in the USA - its birthplace - but all across the globe as well as
the Beverage Industry. It has introduced icons that very few are oblivious to.
The industry and its role in the Pakistan economy, the conditions under which it
is working and the effects it has on the consumers is to remain the concern of
this study. According to Richard D. Brown and George J. Petrol (1986), the
history of the Beverages industry start from 1886, when Atlanta chemist
"Doe" Pemberton developed a reddish - brown syrup with a smidgen of
cocaine (for medicinal purposes) to compete with the many patent medicines and
cure - all elixirs of that time. His company recommended it for the relief of
hangovers headaches, menstrual pains, and a host of other problem. One warm
summer day Pemberton took some syrup down to will is venerable at Jacob's Drug
Store in Atlanta. An ounce of the mixture was put into a glass, which was then
filled with water and ice, creating the first Coca-Cola. The headquarters of
Coca-Cola, now listed by fortune as one of the 50 top corporations in the United
States, is still in Atlanta, Georgia. The actual sale and distribution of that
magic elixir - which, needless to say, on longer contains cocaine - is handled
largely by a number of independent bottlers. These bottlers buy syrup, mix it
with carbonated water, and distribute it to retailers in their area. The number
of retailers who sell Coke to the public almost exceeds counting. In this way a
company with a magic formula but limited capital spread its name around the
country and eventually around the globe. The organizational formula for
merchandising apparently also had a bit of magic. But, of course, the product
was one that people wanted, which is perhaps the first law of success in
marketing. Coke had been successful in establishing a strong loyal consumer
force, on whom it still relies to this very day. Dong business was no sweat once
the industry had set itself for good and the consumer’s tasted veered.
Everything seemed to go smooth enough until hell finally broke loose. Trouble
started creeping into the very foundations of coke who stated loosing a major
share of its market. Thanks to Pepsi. With virtually the same history Pepsi
started gaining ground and proved to be an excellent example of how
razzle-dazzle advertising sharp marketing and an efficient distribution system
can turn a loser in to a winner in a remarkably short period of time. Pakistan
today has a very competitive beverages market. Opportunities for this industry
to establish itself firmly in this country were grim at first because of the
country's low per capita income and because of the business' status depending on
consumer impetus. But much of it was more or less the same when the business
took a start in the USA as well. The Beverage industry has undergone a
revolutionary change during the last couple of decades. The form of processing
and the machinery used these days has developed and is very sophisticated.
Automatic and computerized plants have been installed in the industry thus
making it an industry which is dealing in million of gallons of beverages
yearly. Pakistan Beverages, the bottlers for Pepsi, and Coke bottlers National
Beverages claim that their primary goal is not to undermine the competition but
to expand the market as a whole. Market expansion, in fact, seems to be the
buzzword these days in the beverage industry. Analysts believe the potential
market in Pakistan is though to be enormous because the country's per capita
consumption is as low as 14 bottles per year. Compare this with a 120 bottles
per year in the Philippines, and the scope for expansion becomes more than
obvious. HISTORY OF PEPSI COLA It starts with a small drug store in North
Carolina. This little store belonged to young chemist by the name of
"DOC" BROADHAM. He invented a drink that the customers called BROAD'S
drink. In 1903, Bradham got its drink registered formally by the name of PEPSI
COLA. He set his own company and kept its sales improving gradually. By 1909,
more then 250 bottlers in different American states had been allowed to sell
under the PEPSI COLA license. PEPSI COLA was first sold in the standard size of
6.5 ounces. In 1932 PEPSI COLA took courage enough to introduce a bottle of 12
ounces. In 1950 the PEPSI COLA'S formula had been changed by reducing its
sweetness and calories and a new advertising campaign "Refresh without
filling" had been launched effectively. Under the supervision of the
diligent sales staff and the Marketing experts, PEPSI COLA began setting new
records of eminence. At 30 plants per year, new plants were established all
across the globe. A new attractively designed bottle had been introduced in 1957
in place for the 20 years old bottle, and the product line had been enhanced to
introduce the new flavors of TEAM & MIRINDA. Sindh Beverages (Pvt.) Ltd.,
claim that PEPSI COLA today is available to more than a billion people in 153
different countries which include the central independent states and China.
Progress Report 1996-98 1996  Refranchised 655 restaurants  Closed 379
underperforming restaurants  Restructured Pepsi-Cola International  Enlisted
strong new bottler in Venezuela  Created worldwide snack and beverage units 
Announced plan to sell non-core restaurant chains  Repurchased 54 million
shares 1997  Spun off Pizza Hut, KFC and Taco Bell as Tricon  Refranchised
New Zealand restaurants via public offering  Divested five non-core restaurant
chains  Divested PFS restaurant supply unit  Received $5.5 billion in
restaurant disengagement proceeds  Divested Syrena candy business in Poland 
Divested Gerber baby food business in Mexico  Placed more than 150,000
beverage coolers and vendors in the U.S.  Enlisted new bottlers for
territories in Brazil, Philippines, Japan and Scandinavia  Renegotiated
bottler contracts to centralize fountain beverage distribution  Expanded U.S.
fountain beverage sales and service group  Acquired Pehuamar snack business in
Argentina  Divested Obregon flour mill in Mexico  Repurchased 69 million
shares 1998  Acquired Tropicana, world’s largest branded juice company 
Announced public offering of The Pepsi Bottling Group  Launched new blue globe
logo for brand Pepsi  Launched WOW! fat-free snacks nationally in the U.S. 
Launched Pepsi One, sweetened with Acesulfame K  Acquired Smith’s Snackfoods
Company, Australia’s market leader  Acquired snack chip businesses in
France, Holland, Belgium  Divested BN biscuit business in France  Entered
joint venture to become snack chip leader in South and Central America 
Acquired Barcel, Chile’s second-largest snack company  Expanded stake in
Tasty Foods Egypt  Acquired bottling operations in four U.S. states and two
Canadian provinces  Placed 190,000 beverage coolers and vendors in the U.S. 
Acquired Cracker Jack snack brand  Agreed to sell Polish chocolate and biscuit
units  Consolidated Pepsi and Frito-Lay U.S. media buying  Repurchased 59
million shares HISTORICAL BACKGROUND OF SINDH BEVERAGES The plant had been
established in Phulali in 1974 at first, when it operated with the help of a few
donkey carts for distribution of its products. It had been upgraded in 1988 and
had moved to the rather industrial SITE area.
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