PEPSI Report File

8/6/2019 PEPSI Report File

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Varun baverages ltd. (Pepsico) Rajiv Kumar1

Asummer training report

inmarketing

Under the guidence of Presented ByMr. Vishnu Gupta Rajiv kumar{C.E. in Pepsico ltd. Kosi mathura} Ratm (Mathura)

Rajiv Academy for Technology & Management

NH# 2, Delhi Matura Bypass road,Chhatikara

Mathura -281001(U.P.)


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C O N T E N T S

Sl. No. Topic

1) Preface2) CERTIFICATE

3) DECLARATION

4) ACKNOWLEDGEMENT

5) CHAPTER I

o Introduction

o Scope of projecto Objective of project

6) CHAPTER IIIo Research Methodology

7) CHAPTER IVo Marketing survey & Data Analysiso Testing of Hypothesis

8) CHAPTER IVo Recommendationso Suggestion

9)CONCLUSION

11) BIBLIOGRAPHY

10) QUESTIONAIRE


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Preface

Project is the way to represent your skills in particular fields.

In other worlds project is the way to do something extra in a

different way about that particular you have gained most of

the knowledge. The knowledge about particular never be

complete, these are just like the stages of the knowledge about

the particular.

The topic as given by Pepsico ltd. Kosi Mathura

For Market training .But along with this we are submitting our

experiments also, hence this the best time to present our hard

in front of our respectable teachers. A teacher feels morehappiness and proud if he finds some thing different then he

had given to his students we think is the way to be thankful to

our teachers.


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Declaration

I Rajiv Gupta declare that this project report entitledDealer Survey and Relationship Management withretailers In Mathura and is and of foriginal piece of work done and submitted by metowards partial fulfillment of my Master of BusinessAdministration(MBA) , under the guidance of VishnuGupta(C.E) Pepsico India Ltd.

Date: Place: Signature:


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Acknowledgement

I take this opportunity to express my deep sense ofgratitude to my superiors Vishnu Gupta(C.E) fortheir guidance and other staff of the organization

for extending their valuable support and help inthe preparation of this project report. I am alsothankful to my family, friends and Avani ColdDrinks (Agency PepsiCo)in Mathura for extendingtheir co-operation in completion of this projectreport.

Date:

Place: Signature


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Varun baverages lt

. (

i ) Rajiv Kumar6

INT TION

Th FMCG sector represents consumer goods required for dail or

frequent use. The main segments of this sector are personal care (oral

care, hair care, soaps, cosmetics, toiletries), household care (fabric wash

and household cleaners), branded and packaged food, beverages (health

beverages, soft drinks, staples, cereals, dairy products, chocolates,bakery products) and tobacco.

The Indian FMCG sector is an important contributor to the country's

GD

. It is the fourthlargest sector in the economy and is responsible for

5% of the total factory employment in India. The industry also creates

employment for 3 m people in downstream activities, much of whichis

disbursed in small towns and rural India. This industry has witnessed

strong growth in the past decade. This has been due to liberali ation,

urbani ation, increase in the disposable incomes and altered lifestyle.

Furthermore, the boom has also been fuelled by the reduction in excise

duties, de-reservation from the small-scale sector and the concerted


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efforts of personal care companies to attract the burgeoning affluent

segment in the middle-class through product and packaging

innovations.

Unlike the perception that the FMCG sector is a producer of luxury

items targeted at the elite, in reality, the sector meets the every day

needs of the masses. The lower-middle income group accounts for over

60% of the sector's sales. Rural markets account for 56% of the total

domestic FMCG demand.

Many of the global FMCG majors have been present in the country for

many decades. But in the last ten years, many of the smaller rung Indian

FMCG companies have gained in scale. As a result, the unorganized and

regional players have witnessed erosion in market share.

History of FMCG in India

In India, companies like ITC, HLL, Colgate, Cadbury and Nestle

have been a dominant force in the FMCG sector well supported by

relatively less competition and high entry barriers (import duty was

high). These companies were, therefore, able to charge a premium for

their products. In this context, the margins were also on the higher side.

With the gradual opening up of the economy over the last decade,

FMCG companies have been forced to fight for a market share. In the

process, margins have been compromised, more so in the last six years

(FMCG sector witnessed decline in demand).


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Current Scenario

The growth potential for FMCG companies looks promising over

the long-term horizon, as the per-capita consumption of almost all

products in the country is amongst the lowest in the world. As per the

Consumer Survey by KSA-Technopak, of the total consumption

expenditure, almost 40% and 8% was accounted by groceries and

personal care products respectively. Rapid urbanization, increased

literacy and rising per capita income are the key growth drivers for the

sector. Around 45% of the population in India is below 20 years of age

and the proportion of the young population is expected to increase in

the next five years. Aspiration levels in this age group have been fuelled

by greater media exposure, unleashing a latent demand with more

money and a new mindset. In this backdrop, industry estimates suggest

that the industry could triple in value by 2015 (by some estimates, the

industry could double in size by 2010).

In our view, testing times for the FMCG sector are over and driving

rural penetration will be the key going forward. Due to infrastructure

constraints (this influences the cost-effectiveness of the supply chain),

companies were unable to grow faster. Although companies like HLL

and ITC have dedicated initiatives targeted at the rural market, these are

still at a relatively nascent stage.

The bottlenecks of the conventional distribution system are likely to be

removed once organized retailing gains in scale. Currently, organized

retailing accounts for just 3% of total retail sales and is likely to touch

10% over the next 3-5 years. In our view, organized retailing results in

discounted prices, forced-buying by offering many choices and also


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opens up new avenues for growth for the FMCG sector. Given the

aggressive expansion plans of players like Pantaloon, Trent, Shoppers

Stop and Shoprite, we are confident that the FMCG sector has a brightfuture.

Budget Measures to Promote

FMCG Sector

2% education cess corporation tax, excise duties and custom duties

Concessional rate of 5% custom duty on tea and coffee plantationmachinery

Budget Impact

The education cess will add marginally to the tax burden of all FMCGcompanies

The dividend distribution tax on debt funds is likely to adverselyeffect the other income components of companies like Britannia,Nestle and HLL

The measure to abolish excise duty on dairy machinery is a positivefor companies like Nestle

Concessional rate for tea and coffee plantation machinery is a positivefor Tata Tea, HLL, Tata Coffee and other such companies

Duty reduction in food grade hexane will have a marginally positiveimpact on companies like Marico and HLL

Area specific excise exemptions for North East, J&K, HimachalPradesh will continue to encourage FMCG companies to relocate tothese areas.

Budget over the

years

Budget 2001-02 Budget 2002-03 Budget 2003-04


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y From 35-55% to75% for crude

edible oily From 45-65% to

85% for refinededible oil

y From 35% to70% for copra,coconut, tea andcoffee

y From 25% to

55% for crudepalm oily Development

allowance of teaindustry raisedto 40% from20%

y All foodpreparationsbased on fruitsand vegetables(pickles, sauces,ketchup, juices,

jams etc.) madecompletelyexempt fromexcise duty

y Excise oncosmetics and

toiletries halvedto 16%

y Increased focuson agricultural

reforms with anaim to integratethe countrywidefood market

y Deregulation ofthe milkprocessingcapacity

y Excise duty

structure largelyuntouched.Only for tea, theduty wasreduced from Rs2 per Kg to Re 1

y Customs dutyon tea andcoffee doubledto 100%

y Duty onimported pulsesupped to 80%

y Import duty onwine and liquorslashed from210% to 180%

y Excise onbiscuits reduced

to 8% from 16%.Excise on softdrinks andsugar boiledconfectioneryalso reduced

y All states toswitch to VATin FY04(deadline nowhas beenextended tillend FY05)

y Loans toagriculture andto small-scalesector will nowbe available atmaximu 2%

above primelending rate(PLR)

y Developmentplans for roads,ports, railwaysand airports

y Customs dutyon alcoholic

beveragesreduced

India offers a large and growing market of 1 billion people of which 300

million are middle class consumers. India offers a vibrant market of

youth and vigor with 54% of population below the age of 25 years. These


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young people work harder, earn more, spend more and demand more

from the market, making India a dynamic and aspirational society.

Domestic demand is expected to double over the ten-year period from1998 to 2007. The number of households with "high income" is expected

to increase by 60% in the next four years to 44 million households.

India is rated as the fifth most attractive emerging retail market. It

has been ranked second in a Global Retail Development Index of 30

developing countries drawn up by A T Kearney. A.T. Kearney has

estimated India's total retail market at $202.6 billion, is expected to grow

at a compounded 30 per cent over the next five years. The share of

modern retail is likely to grow from its current 2 per cent to 15-20

percent over the next decade, analysts feel.

The Indian FMCG sector is the fourth largest sector in the

economy with a total market size in excess of US$ 13.1 billion. The

FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4

billion in 2015. Penetration level as well as per capita consumption in

most product categories like jams, toothpaste, skin care, hair wash etc in

India is low indicating the untapped market potential. Burgeoning

Indian population, particularly the middle class and the rural segments,

presents an opportunity to makers of branded products to convert

consumers to branded products.

India is one of the worlds largest producers for a number of

FMCG products but its FMCG exports are languishing at around Rs


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Varun baverages lt

. (

i ) Rajiv Kumar13

Type Public (NY

PEP)

Founded 1965

Headquarters New York, USA

Key people Indra Nooyi,

Chairwoman, President & CEO

Industry Food and beverage

Products:

Pepsi

Tropicana Products

Gatorade

Lay's

Doritos

Frappuccino (for Starbucks)

MountainDew

Operating income $6.44 billion USD (2006)

Net income $5.64 billion USD (2006)

profit margin 16.06%

Employees 153,000(2005)

G

!

OUP OF COMPANIES

Frito-Lay North America

PepsiCo Beverages North America,

PepsiCo International

Quaker Foods North America


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Varun baverages lt"

. (#

$ % & i' ( ) Rajiv Kumar14

Mission

The main objective of the company is to provide best quality products to

its consumer. Another objective is to provide healthy rewards to its

investor, good reward to its employee and other investor and partners

who financially help the company


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Vision

The vision of the company is to improve in all aspects in which they

operate. By improving in social and economical environment, they want

to make tomorrow better than today.


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A Brief Pepsi History

In 1893, Caleb Bradham,a young pharmacist from New

Bern, North Carolina, begins experimenting with many

different soft drink concoctions. Like many pharmacists

at the turn of the century he had a soda fountain in his

drugstore, where he served his customers refreshing

drinks, that he created himself. His most popularbeverage was something he called "Brad's drink" made of

carbonated water, sugar, vanilla, rare oils, pepsin and cola nuts.

One of Caleb's formulations, known as "Brad's drink", created in the

summer of 1893, was later renamed Pepsi Cola after the pepsin and cola

nuts used in the recipe. In 1898, Caleb Bradham wisely bought the trade

name "Pep Cola" for $100 from a competitor from Newark, New Jersey

that had gone broke. The new name was trademarked on June 16th,

1903. Bradham's neighbor, an artist designed the first Pepsi logo and

ninety-seven shares of stock for Bradham's

new company were issued.

1898 - One of Caleb's formulations, known

as "Brad's Drink," a combination of

carbonated water, sugar, vanilla, rare oils

and cola nuts, is renamed "Pepsi-Cola" on


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August 28, 1898. Pepsi-Cola receives its first logo.

1905 - Pepsi-Cola's first bottling franchises are established in Charlotteand Durham, North Carolina. Pepsi receives its new logo, its first

change since 1898.

1906 - Pepsi gets another logo change, the third in eight years. The

modified script logo is created with the slogan, "The Original Pure Food

Drink."

1908 - Pepsi-Cola becomes one of the first companies to

modernize delivery from horse drawn carts to motor

vehicles. Two hundred fifty bottlers in 24 states are under contract to

make and sell Pepsi-Cola.

1910 - The first Pepsi-Cola bottlers' convention

is held in New Bern, North Carolina.

1920 - Pepsi theme line speaks to the consumer

with "Drink Pepsi-Cola, it will satisfy you."

1928 - After five continuous losing years, Megargel reorganizes his

company as the National Pepsi-Cola Company, becoming the fourth

parent company to own the Pepsi trademark.

1934 - A landmark year for Pepsi-Cola. The drink is a hit and to attract


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even more sales, the company begins selling its 12-ounce drink for five

cents (the same cost as six ounces of competitive colas). The 12-ounce

bottle debuts in Baltimore, where it is an instant success. The costsavings proves irresistible to Depression-worn Americans and sales

skyrocket nationally.

Caleb Bradham, the founder of Pepsi-Cola and "Brad's Drink," dies at 66

(May 27th,

1867-February 19th, 1934).

1935 - Guth moves the entire Pepsi-Cola operation to Long Island City,

New York, and sets up national territorial boundaries for the Pepsi

bottler franchise system.

1936 - Pepsi grants 94 new U.S. franchises and year-end profits reach

$2,100,000.

In 1940, the Pepsi Cola company made history when the first advertising

jingle was broadcast nationally on the radio. The jingle was "Nickel

Nickel" an advertisement for Pepsi Cola that referred to the price of

Pepsi and the quantity for that

price "Nickel Nickel" became a

hit record and was recorded into

fifty-five languages.

1941 - The New York Stock


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Varun baverages lt)

. (0

1 2 3 i4 5 ) Rajiv Kumar19

Exchange trades Pepsi's stock for the first time. In support of the war

effort, Pepsi's bottle crown colors change to red, white, and blue.

1942 - One on many company sponsored efforts to allow soldiers to

communicate with friends or family. This record was made in New York

City but oftenbooths would be set up with mobile recording equipment

that was bought to where the soldiers were. Shell material on solid core.

78 rpm.

1943 - Pepsi's theme line becomes "Bigger Drink, Better Taste."

1948 - Corporate headquarters moves from Long Island City, New York,

to midtown Manhattan.

1950 - Alfred N. Steele becomes President and CEO of Pepsi-Cola. Mr.

Steele's wife, Hollywood movie star Joan Crawford, is instrumental in

promoting the company's product line.

Pepsi receives its new logo, whichincorporates the "bottle cap"

look. The new logo is the fifthin Pepsihistory.

1953 - "The Light6

efreshment" campaign capitali7 es on a change in the

product's formula that reduces caloric content.

1955 - Herbert Barnet is named President of Pepsi-Cola.


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1959 - Pepsi debuts at the Moscow Fair. Soviet Premier Khrushchev and

U.S. Vice President Nixon share a Pepsi.

1960 - Young adults become the target consumers and Pepsi's

advertising keeps pace with "Now it's Pepsi, for those who think young."

1962 - Pepsi receives its new logo, the sixth in Pepsi history. The

'serrated' bottle cap logo debuts, accompanying the brand's

groundbreaking "Pepsi Generation" ad campaign.

1963 - After climbing the Pepsi ladder from fountain syrup salesman,

Donald M. Kendall is named CEO of Pepsi-Cola Company. Pepsi-Cola

continues to lead the soft drink industry in packaging innovations, when

the 12-ounce bottle gives way to the 16-ounce siE e. Twelve-ounce Pepsi

cans are first introduced to the military to transport soft drinks all over

the world.

1964 - Diet Pepsi, introduced as America's first national

diet soft drink. Pepsi-Cola acquires Mountain Dew

from the Tip Corporation.


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1965 - Expansion outside the soft drink industry begins. Frito-Lay of

Dallas, Texas, and Pepsi-Cola merge, forming PepsiCo, Inc.

Military 12-ounce cans are such a success that full-scale commercial

distribution begins.

Mountain Dew launches its first campaign,

"Yahoo Mountain Dew...It'll tickle your innards."

1970 - Pepsi leads the way into metrics by

introducing the industry's first two-liter bottles.

Pepsi is also the first company to respond to

consumer preference with light-weight,

recyclable, plastic bottles. Vic Bonomo is named

President of Pepsi-Cola. The Pepsi World Headquarters moves from

Manhattan to Purchase, NY.

1974 - First Pepsi plant opens in the U.S.S.R. Television ads introduce

the new theme line, "Hello, Sunshine, Hello Mountain Dew."

1976 - Pepsi becomes the single largest soft drink brand sold in

American supermarkets. The campaign is "Have a Pepsi Day!" and a


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classic commercial, "Puppies," becomes one of America's best-loved ads.

As people get back to basics, Pepsi is there as one of the simple things in

life.

1977 - At 37, marketing genius John Sculley is named President of Pepsi-

Cola.

1978 - The company experiments with new flavors. Twelve-pack cans

are introduced.

1980 - Pepsi becomes number one in sales in the take home market.

1981 - PepsiCo and China reach agreement to manufacture soft drinks,

with production beginning next year.

1982 - Pepsi Free, a caffeine-free cola, is introduced nationwide. Pepsi

Challenge activity has penetrated 75% of the U.S. market.

1984 - Pepsi advertising takes a dramatic turn as Pepsi becomes "the

choice of a New Generation." Lemon Lime Slice, the first major soft

drink with real fruit juice, is introduced, creating a new soft drink

category, "juice added." In subsequent line of extensions, Mandarin

Orange Slice goes on to become the number one orange soft drink in the

U.S. Diet Pepsi is reformulated with NutraSweet (aspertame) brand

sweetener.


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1985 - After responding to years of decline, Coke loses to Pepsi in

preference tests by reformulating. However, the new formula is met

with widespread consumer rejection, forcing there-introduction of theoriginal formulation as "Coca-Cola Classic." The cola war takes "one

giant sip for mankind," when a Pepsi "space can" is successfully tested

aboard the space shuttle. By the end of 1985, the New Generation

campaign earns more than 58 major advertising and film-related

awards. Pepsi's campaign featuring Lional Richie is the most

remembered in the country, according to consumer preference polls..

1987 - Pepsi-Cola President Roger Enrico is named President/CEO of

PepsiCo Worldwide Beverages. Pepsi-Cola World Headquarters moves

from Purchase to Somers, New York. After a 27 year absence, Pepsi

returns to Broadway with the lighting of a spectacular new neon sign in

Times Square.

1988 - Craig Weatherup is appointed President/CEO of Pepsi-Cola

Company.

1989 - Pepsi lunges into the next decade by declaring Pepsi lovers "A

Generation Ahead." Chris Sinclair is named President of Pepsi-Cola

International. Pepsi-Cola introduces an exciting new flavor, Wild

Cherry Pepsi.

1990 - American Music Award and Grammy winner rap artist Young

MC writes and performs songs exclusively for national radio ads for


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Pepsi. Ray Charles joins the Pepsi family by endorsing Diet Pepsi. The

slogan is "You Got The Right One Baby."

1991 - Craig E. Weatherup is named CEO of Pepsi-Cola North America,

as Canada becomes part of the company's North American operations.

Pepsi introduces the first beverage bottles containing recycled

polyethylene terephthalate (or PET) into the marketplace. The

development marks the first time recycled plastic is used in direct

contact with food in packaging.

1992--Pepsi-Cola launches the "Gotta Have It" theme which supplants

the longstanding "Choice of a New Generation."

1993 - Brand Pepsi introduces its slogan, "Be Young. Have Fun. Drink

Pepsi." Pepsi-Cola profits surpass $1 billion. Pepsi introduces an

innovative 24-can multipack that satisfies growing consumer demand

for convenient large-size soft drink packaging. "The Cube" is easier to

carry than the traditional 24-pack and it fits in the refrigerator.

1994 - New advertising introducing Diet Pepsi's freshness dating

initiative features Pepsi CEO Craig Weatherup explaining the

relationship between freshness and superior taste to consumers. Pepsi

Foods International and Pepsi-Cola International merge, creating the

PepsiCo Foods and Beverages Company.

1995 - In a new campaign, the company declares "Nothing else is a


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Pepsi" and takes top honors in the year's national advertising

championship.

1996 - In February of this year, Pepsi makes history once again, by

launching one of the most ambitious entertainment sites on the World

Wide Web. Pepsi World eventually surpasses all expectations, and

becomes one of the most landed, and copied, sites in this new media,

firmly establishing Pepsi's presence on the Internet.

1997 - In the early part of the year, Pepsi pushes into a new era with the

unveiling of the GeneratioNext campaign. GeneratioNext is about

everything that is young and fresh; a celebration of the creative spirit. It

is about the kind of attitude that challenges the norm with new ideas, at

every step of the way.

PepsiCo. announces that, effective October 6th, it will spin off its

restaurant division to form Tricon Global Restaurants, Inc. Including

Pizza Hut, Taco Bell, & KFC, it will be the largest restaurant company in

the world in units and second-largest in sales.

1998 - Pepsi celebrates its 100th anniversary. PepsiCo.

Chairman and CEORoger A. Enrico donates his salary to

provide scholarships for children of PepsiCo employees.

Pepsi introduces PepsiOne - the first one calorie drink without that diet

taste!


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2000 - Although Pepsi is a great place to work, Steven Truitt (aka

'struitt') takes his skills and hard work elsewhere (for more money of

course!), therefore putting an end to his Pepsi page! For moreinformation about Pepsi, choose a search engine and search for 'Pepsi' or

visit www.pepsi.com or www.pepsico.com.

2005 - Pepsi invited to introduce new brand cola

PEPSICO IN INDIA

PepsiCo gained entry to India in 1988 by creating a joint venture with

the Punjab government-owned Punjab Agro Industrial Corporation

(PAIC) and Voltas India Limited. This joint venture marketed and sold

Lehar Pepsi until 1991, when the use of foreign brands was allowed;

PepsiCo bought out its partners and ended the joint venture in 1994.

Others claim that firstly Pepsi was banned from import in India, in 1970,

for having refused to release the list of its ingredients and in 1993, the

ban was lifted, with Pepsi arriving on the market shortly afterwards.

These controversies are a reminder of "India's sometimes acrimonious

relationship with huge multinational companies." Indeed, some argue

that PepsiCo and The Coca-Cola Company have "been major targets in

part because they are well-known foreign companies that draw plenty of

attention."

In 2003, the Centre for Science and Environment (CSE), a non-

governmental organization in New Delhi, said aerated waters produced


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by soft drinks manufacturers in India, including multinational giants

PepsiCo and The Coca-Cola Company, contained toxins, including

lindane, DDT, malathion and chlorpyrifos pesticides that cancontribute to cancer, a breakdown of the immune system and cause birth

defects. Tested products included Coke, Pepsi, 7 Up, Mirinda, Fanta,

Thums Up, Limca, and Sprite. CSE found that the Indian-produced

Pepsi's soft drink products had 36 times the level of pesticide residues

permitted under European Union regulations; Coca Cola's 30 times. CSE

said it had tested the same products in the US and found no such

residues. However, this was the European standard for water, not for

other drinks. No law bans the presence of pesticides in drinks in India.

The Coca-Cola Company and PepsiCo angrily denied allegations that

their products manufactured in India contained toxin levels far above

the norms permitted in the developed world. But an Indian

parliamentary committee, in 2004, backed up CSE's findings and a

government-appointed committee, is now trying to develop the world's

first pesticides standards for soft drinks. Coke and PepsiCo opposed the

move, arguing that lab tests aren't reliable enough to detect minute

traces of pesticides in complex drinks. On December 7, 2004, India's

Supreme Court ruled that both PepsiCo and competitor.

The Coca-Cola Company must label all cans and bottles of the

respective soft drinks with a consumer warning after tests showed

unacceptable levels of residual pesticides.[citation needed]

Both companies continue to maintain that their products meet all

international safety standards without yet implementing the Supreme


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Court ruling.[citation needed] As of 2005, The Coca-Cola Company and

PepsiCo together hold 95% market share of soft-drink sales in India.

PepsiCo has also been alleged[attribution needed] to practice "waterpiracy" due to its role in exploitation of ground water resources resulting

in scarcity of drinking water for the natives of Puthussery panchayat in

the Palakkad district in Kerala, India. Local residents have been

pressuring the government to close down the PepsiCo unit in the village.

In 2006, the CSE again found that soda drinks, including both Pepsi and

Coca-Cola, had high levels of pesticides in their drinks. Both PepsiCo

and The Coca-Cola Company maintain that their drinks are safe for

consumption and have published newspaper advertisements that say

pesticide levels in their products are less than those in other foods such

as tea, fruit and dairy products. In the Indian state of Kerala, sale and

production of Pepsi-Cola, along with other soft drinks, has been banned.

Five other Indian states have announced partial bans on the drinks in

schools, colleges and hospitals.

3.1 Highlights of PepsiCo in India:

World leader - Convenient Foods and Beverages

Revenues of more than $35 billion

More than 1,68,000 employees

Available in nearly 200 countries and territories

Groups 37 bottling plants in India

16 are company owned and 21 are franchisee owned


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Tropicana was acquired in 1998 and PepsiCo merged with The

Quaker Oats Company in 2001

Generates direct employment for more than 4000 people in Indiaand indirect employment for 60,000 people

y Set up 8 greenfield sites in backward regions of different states.

PepsiCo intends to expand its operations and is planning an

investment of approximately US$ 150 million in the next two-three

years.

Annual exports from India are worth over U.S$60 million

PepsiCo Founded in 1965 through the merger of Pepsi-Cola and

Frito-Lay

PepsiCo entered India in 1989


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THE MARKETING MIX-4 PS WITH SPECIALREFERENCE TO PEPSI:

Product:

A business needs to consider the products that itproduces and the stage of the product life cycle that a product is at.Marketing strategies will vary according to the type of product and itsstage in the life cycle.

In case of Pepsi, in the rural markets, the 300ml bottleand now days the new small or commonly known as the chota pepsiis very much popular. The Pepsi Co. is even thinking of introducingtheir new Pepsi-Aha, but presently they are concentrating more on thenormal pepsi as the rural market is a niche market. Pepsi is evensuccessful in introducing the big 1-1.5 liter PET bottles in the ruralmarkets. These big bottles are very popular during big festivals andmarriages.


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Price:

Most businesses use a "cost plus" method for settingthe prices of their products. This involves determining unit productioncosts and then adding in a profit margin. However, many other factorsare involved. Consider "perceived price" (what you think consumers willbe prepared to pay), demand elasticity (is it elastic or inelastic?),

competitors' pricing (can you afford to undercut their prices?), pricingob jectives (what do you want to achieve increased market share?increased profits? market leadership? etc.)

Example 2 Perfume

How much does it cost to make?

Can businesses afford a "price war"?

Why is Coca Cola so successful?

As far as the pricing goes, the 300 ml Pepsi bottle ispriced at Rs. 10. But the company soon realized that this pricing workedin the urban markets but not in the rural markets as in the rural markets,Pepsi is not a necessity but a luxury. They found out that people in therural markets bought cold drinks only if there was some occasion. Aprice point of Rs 10 for a 300 ml bottle has proved a major deterrent: it

has kept away new consumers in the urban and semi-urban pockets, andit has blanked out the far larger rural markets where annual per capitaconsumption is less than a bottle. So the Rs. 10 bottle was not thatsuccessful. But their sales increased after introducing the chota Pepsi.This 200ml Pepsi was reasonably priced between Rs.5- Rs.7. This was amajor weapon for the expansion of the rural market. Pepsi expects thesmall-size offering to account for 30 per cent of volumes this year


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compared with 18 per cent last year. But there are other areas of concern principally that the 200 ml offering should not cannibalize 300 mlsales. In that case, there will be no market growth. That is why pricing

could be crucial. Pepsi, for instance, has reckoned that giving consumers33 per cent (100 ml) less cola at 50 per cent of the price (Rs 5) is not asustainable option and can, at best, be used as an introductory offer. Theconclusion is based on hard facts. Last year, the beverage giants test -marketed 200 ml bottles at a price of Rs 5. Instead of growth, Pepsidiscovered that 300 ml drinkers merely shifted to the 200 ml variant, themarket remained stagnant and everyone lost money. The conclusion wasclear: cutting prices does not necessarily expand the market.


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Place

This generally refers to the physical locations of product sales as well as

the methods of distribution. However, it is also considered to be the"place" or "position" in the market of the product; refer to informationbelow. Businesses need to make many decisions related to "place":access, parking, competition, physical location etc.

Its the most important P in the cola wars Place. Andnothing evokes more passion in Pepsi and Coke than distribution. Majorinnovation is underway on the distribution front at Pepsi, pre-selling

being the biggest of all. Its been successfully test marketed in Bangalore,Baroda and Coimbatore and may soon roll out nationally.

In case of the distribution network, there is noinvolvement of wholesalers in the distribution of products. It is morelike an agent network. The companies have divided the country intovarious regions and established a franchisee in each region. Thefranchisees have their own bottling plants and manage all the day-to-day operations. However, of late, the soft drinks companies have startedsetting up company owned bottling units have been acquiring some ofits franchise bottles.

In the current system, the strike rate in the Delhimarket is about 40 per cent, which can be improved to 80 per cent in thepeak season, claims a franchise director. The result for Pepsi could besignificant

savings. Colas service just 7.5-8 lakh accounts compared to the otherFMCG players who service three times the number. Innovation in ourdistribution system will take us closer to the 21 lakh figure, says Vats, afranchise director.


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Pepsi believes in direct distribution whereas Cokedoesnt. It mainly concentrates on dealers and most importantly cuttingcosts. There are plenty of innovations possible in distribution that can

cut costs, says a Pepsi official.For Pepsi, the rural market is a chosen thrust this year. It

has targeted to reach 20 to 28 per cent of the rural population in the firstyear of this operation. In the first stage, the corporation is planning amassive roll out in villages with populations of 5000. To do thiseffectively, Pepsi is focusing on establishing a cold chain.

The company has developed special freezers that allowits products to stay chilled despite power cuts of three to four hours. It

will also use traditional iceboxes to sell its product in rural India. For therural markets, Pepsi is looking at the wholesale route since the logisticsof direct distribution are too huge to handle in the interiors.


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Promotion

This refers to the promotion of the product to thetarget market. This is achieved through a combination of: advertising:use of electronic and print media. The "reach" (how many people willsee the advert), frequency (how many times will I advertise theproduct?) and impact of the advertising must also be evaluated.

Personal selling: what happens in the "shop", contact between salespeople and consumers or customers.

Sales promotion: use of gimmicks and incentives e.g. competitions.Sponsorship and promotional licensing: including specific products soldunder license that promotes the business (e.g. football jumpers).Publicity or public relations: "adversarial" in local papers or specialpromotional materials.

Due to the cola wars promotion, and advertising hasalways been an integral part for both the cola cos: Pepsi and Coke. Butfor the first time perhaps in the history of cola wars, the strategies of thetwo giant cos are diverging in India. Whether its business or productstrategies or the critical distribution game plan, the archrivals are takingroads that do not meet. Mr. Bakshi of Pepsi Co. is bringing a change intheir distribution and marketing strategies. Now days where Coke isconcentrating more on the 200ml bottle, Mr. Bakshi of Pepsi says The200ml bottle gets zero demand in the rural market. He is concentratingon the 1.0 liter bottles of Pepsi. The Pepsi Co. had used an excellentmarketing strategy here. During the Lagaan mania they were

distributing free tickets in the rural markets along with their 1.5-literPETbottles. Pepsi made this 1.5-liter PETbottle very famous for theirspecial festive occasions and marriage.

Well the popularity of the product has also increaseddue to their advertisements or basically famous cricket and bollywoodpersonalities endorsing this product. For instance the Sachin Aala re


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Aala advertisement where even he is wearing a mask along with thoserural kids. Or you can even take the new Sachin and Amitabh Bachchanadvertisement where both of them say Yeh Dil Maange More!!!!!!!

Sachin has done many advertisements for Pepsi in the span of 10 years.Pepsis rural market advertisement- Pepsi has unveiled

a major campaign in Andhra Pradesh, roping in top Telugu film star,Pawan Kalyan, even as the star's elder brother, Chiranjeevi, is intopushing Coca-Cola's Thums Up. Pawan Kalyan, however, ruled out anyrivalry between him and his brother. Though he will sing Yeh DilMaange more, his brother will say Yeh Dil Maange no more. We haveour lives and we have our own choices, he said on the possible in-house cola feud

Pepsi also kicked off a rural campaign, spread overtwo months. Decorated Pepsi vans will roll out into market of the State.Every consumer drinking a Pepsi from these vans will get to play agame and win prizes. These include Pawan Kalyan memorabilia, T-shirts, autographed posters and calendars.

Explaining the reason for choosing Pawan Kalyan to endorse Pepsi, Mr.Rohit Ohri, Director HTA, Pepsi's ad agency, said Pepsi and PawanKalyan were going to be an ideal combination. Both are so youthful,

energetic and fun-loving, he said. Mr. Vijay Shanker Subramaniam,Vice-President (Marketing), Pepsi Foods Ltd, said the company wasstarting an aggressive campaign in Andhra Pradesh. Apart from thevan operations, which were flagged off by Pawan Kalyan, othercampaigns have been lined up throughout the year.

Later, Pawan Kalyan presented a cheque for Rs 5 lakh to Mr. MehmoodAli, a mechanic with the Andhra Pradesh State Road TransportCorporation for winning Pepsi's Mera number ayega campaign.

Lastly, we all know that though Coke ranks 1st with 57 % of themarket share (which includes Thums up too), Pepsi ranks 2nd with43% of the market share. The Pepsi Co. has fought a bitter struggleupwards starting from a zero market share. When Pepsi entered themarket in 1989, they faced the daunting task of pacifying Indianswadeshi activists alone. Their trucks were smashed and offices


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ransacked so as to dissuade them from entering the Indian market.Whereas when Coke entered (or re-entered) the Indian market in 1993,the situation had been smoothed out by Pepsi already, and the

atmosphere was extremely conducive to foreign multinationals comingto India. Therefore, though Coke ranks 1st, it got this position only afterintroducing the Parle products who already had a 70% market share atthat point of time. Presently Pepsi Co. is also concentrating on its otherproducts like slice, mirinda and aquafina. Their next aim is to popularizetheir other products like sodas, then the new Pepsi Aha- the apple drinkand beat coke to become the new market leader.


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Highlights of Indian FMCG sector:

The Indian FMCG sector - the fourth largest sector in the economy

market size > $13.1 bn

Strong MNC presence

Well established distribution network

Intense competition between the organized and unorganized

segments

200 million people expected to shift to processed and packaged

food by 2010

Low operational cost.

India needs around $28 billion of investment in the food-

processing industry.

FOOD AND BEVERAGES

Size of the Indian food processing industry- $ 65.6 billion,

including $20.6 billion of value added products.

The health beverage industry -$230 million

Bread and biscuits at $1.7 billion

Chocolates at $73 million

Ice creams at $188 million.The size of the semi-processed/ready-to-eat food segment - over

$1.1 billion.

Three largest consumed categories of packaged foods are packed

tea, biscuits and soft drinks.


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Total soft drink market is estimated at 284 million crates a year or

$1 billion.


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Varun baverages ltF

. (G

H I P iQ R ) Rajiv Kumar40

4. ORGANIZATIONAL STRUCTURE

Customer Executives

Assistant Sales and DevelopmentManager

Territory DevelopmentManager

Unit Manager

Marketing DevelopmentManager

Sales Trainees

Marketing DevelopmentCoordinator


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Varun baverages ltS

. (T

U V W iX Y ) Rajiv Kumar41

5. PEPSICOS DISTRIBUTION SYSTEM

Consumer

Indenting

Primary

Sale

SecondarySaleMarket /Retailers

Distributor

PepsiCos Plant


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6. PEPSICOS PRODUCTS

Following are main products of Pepsi co(india) pvt limited.

Pepsi

Mirinda Orange

Mirinda Lemon

7 Up

Mountain Dew

Slice

Mirinda Sorbet (Limited Edition)

Pepsi Gold (Limited Edition)

Pepsi Diet

Lehar Soda

Aquafina

Tropicana

Gatorade

Lehar Namkeen

Lays

Kurkure

Uncle Chips

Cheetos


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Varun baverages lt

. (a

b c d ie f ) Rajiv Kumar43

7. RETAIL CHANNEL

Convenience channelincludes different kiosks are

whichis convenient to general public.

Grocery channelincludes different grocery shops .

Eatery channelincludes different hotels, restaurants

etc.

ConvenienceChannel

Grocery

Channel

EateryChannel


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Sales Management

Recruitment Procedure

There are three main line for recruitment of the Sales trainee of the

company

Campus Interview

Consultant

Employee of the Company

Campus Interviews: The company recruits students from various

institutes of professional courses like MBA. The selection procedure

includes GD & personal interviews followed by HR interviews.

Consultants: The company has tie-ups with professional consultants

which provide a high prospector base for recruitment. The low level &

the middle level employees are recruited through this procedure.

Employees of the company: Mostly the top level employees are selected

from inside the company since the company can get loyal persons

having the experience of the companys work culture.

Training

There are mainly two types of method for giving training to their

employee

On the Job training and

Classroom training through lectures.


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Evaluation

There is a evaluation form in which different ob jectives of the company

are written. At the end of the year, immediate officer just tally whether a

particular ob jectives of which predetermine ob jectives are achieved or

not.

Sales Quota

In company, sales quota is decided on the basis of the sales of the last

year. After considering sales of the company, they analyze the growth of

the market. On the basis of the sales and growth of the market, company

decides sales quota for the next year. On the basis of the sales quota,

target of each area is decided.

Sales territory:

Sales territory is decided on the basis of the no. of the distributor in the

particular territory. Normally distributor has to cover 40 outlets per day

per Route driver. In particular territory, routes are decided by the

company. Like Route A Route B Route C. Route Driver (RD) of the

company visits particular route twice in a week. Route Driver distributesproducts as per requirements of the outlets.

LOAD INS:


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RA to return to the Warehouse after completing the days runs as

per the Route Planner.

Requisition forms shall be updated with quantity of unsold stockand empties brought back to Warehouse and shall be submitted to

checker.

Checker shall independently verify the stock brought in by the RA

and record the physically verified Stock in the checkers report.

The Load in slip needs to be signed by the RA, Checker and the

settlement clerk.

Settlement clerk / Warehouse manager to reconcile physical stock

vis- a-vis stock as per Requisition Form.

Checker shall update the Gate Pass section of DSS with details of

actual load ins and empties and submit to the ASDOS clerk.

INVENTORY CONTROL MANAGEMENT /

ACCOUNTING OF EXPIRED STOCKS

Warehouse Manager to ensure that expired stock is stored

separately.

Stock supervisor to co-ordinate with Warehouse manager and

submit report of expired stock to TDM & SAM.


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Details of all expired products needs to be sent to MU control

Group as per Authority Matrix

MU control group to forward the same to BU for approvals.

Post approval from BU, expired stocks will be drained at

warehouses in presence of PI employee.

Sales accounting Manager shall be the FPR for issuing instructions

to warehouses for draining of stocks.

MARKET AUDIT

Market audit is carried out through deployment of external resources/

internal resources.

Market Audit must be done for the following claims:

Card Discounts

Scheme Discounts

Spoke Commission

Market Auditors to show the report to the CE and the TDM for their

comments on the market audit done and obtain their signature on the

report.

At the end of every month, the market auditors must provide the report

of each and every distributor audited against the plan given at the

beginning of the month to the UFM/SAM


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DEALER SURVEYAND RELATIONSHIP

MANAGEMENT WITH RETAILERS &

CHECKADVERTISMENTINMARKET


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SCOPE OF PROJECT

1. Detailed study of the ADVERTISMENTofsoft drinks industry in India

2. Analysis of Pepsis performance against the other prevailingnoncarbonatedSoft drinks brands in the country.

3. Evaluate the performance of Agency performance and compare withthe market size in the area.

4. Find out the problems in the area related to retailers.

5. To increase sales in market.


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OBJECTIVES OF THE PROJECT

1- Survey of each dealer and retailer in the area allotted.

2-Create good relationship with Retailers.

3. Sell the products to the retailers who are not willing to buy Pepsi

product.

4. To improve advertisement in market.


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Research Methodology

SAMPLING

Basic sampling Term

SAMPLE AND SAMPLE SURVEYo A part of a population, or a subset from a set of units, which is

provided by some process or other, usually by deliberate selection

with the ob ject of investigating the properties of the parent

population or set.

o Sample survey refers to the survey which is carried out using a

sampling method, i.e. in which a portion only, and not the whole

population, is surveyed.

POPULATION

o In statistical usage the term population is applied to any finite or

infinite collection of individuals.

o It has displaced the older term universe, which is derived from the

universe of discourse of logic.


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o It is practically synonymous with aggregate and does not

necessarily refer to a collection of living organisms.

SAMPLING UNIT

o One of the units into which an aggregate is divided or regarded as

divided for the purposes of sampling, each unit being regarded as

individual and indivisible when the selection is made.

o The definition of unit may be made on some natural basis, or on

some arbitrary basis.

o In the case of multi-stage sampling the units are different at

different stages of sampling.

SAMPLING FRAME

o A list, map or other specification of the units, which constitute the

available information relating to the population designated for a

particular sampling scheme.

o The nature of the frame exerts a considerable influence over the

structure of a sample survey.

o In multi-stage sampling it is sometimes possible to construct the

frame at higher stages during the progress of the sample survey

itself.


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SAMPLING DESIGN

o A sample design is a definite plan for obtaining a sample from the

sampling frame.

o It refers to the technique or the procedure the researcher would

adopt in selecting some sampling units from which inferencesabout the population is drawn.

STATISTIC AND PARAMETER

o A statistic is a characteristic of a sample.

o A parameter is a characteristic of a population.

o To obtain the estimate of a parameter from a statistic constitutes

the prime objective of sampling analysis.


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METHODOLOGY:

DATA COLLECTION

1) Primary Sourceg Retailersg Whole sellers

2) Secondary Source

g

Internet. News paper. T.V.


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RESEARCH INSTRUMENTS

Questionnaires

. FAQs (Frequently asked questions)

SAMPLING PLAN

1) Sampling Unit: Who is to be surveyed?

Urban Retailers,Rural Retailer

2) Sample Size: How many people to be surveyed?

All retailers in the area (of all age groups)

3) Sampling Procedure:

We have taken sample from following areas:

1) holi gate

2) Dampier Nagar

3) Vikas Market

4) New Bus stand

5) M.H. MATHURA

6) Tank churaha


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7) Tentigaon

8) Surir

9) etc. near by Mathura


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Pepsi

coca-cola

Total Number of Shops In The Area - 156

Refrigerator- 43 units

(According to sample size)

Retailers preference (On the basis of the stocks they

have in the shop)

Pepsi 65%

Coca-cola 35%

35%

65%


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sign board pepsi

sign board coca-

cola

Visi Pepsi

Visi Coca-Cola

Sign Board on Shop

82 shops has signboards of any company

Pepsi 71% (75 Shops)

Coca-cola 29% (39 shops)

19%

81%

Refrigerator in Shop-

43 shops has refrigerator

Pepsi-73% (58shops)

Coca-cola-27% (22 Shops)

27%

73%


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Cold Stock

Pepsi

Cold Stock

Coca-Cola

warm Stock

Pepsi

warm Stock

Coca-Cola

Warm Stock-

Pepsi-61%(6006units)

Coca-Cola- 39%(3993units)

41%

59%

Cold Stock-

Pepsi-55% (3708 units)

Coca-Cola-45% ( 3034 units)

45%

55%


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Some advertisement Compare with Coca-cola


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In the given pictures the pepsi is better than coke is clear

represented by advertisement compare b/w both.


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Through FAQs

1-The market position of the Pepsi is very strong in area

allotted to me near about 75%softdrinks sold belongs to

Pepsi.

2-Dew is the most selling brand in the area and at second

position is mineral water.

3-Retailers are not getting the benefits provided by the

company because agency is more interested in selling to the

whole sellers in bulk.

4-when there is any scheme launched by the company

agency sells all the stock to the whole sellers for some

benefit.

5-Whole sellers are selling at low price than Agency because

of the stock they bought in schemes.

6-The work force is not well compensated their salary is very

little.

7-Acceseries are provided to the big shops only and the

should be on the main road.


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Varun baverages lth

. (i

p q r is t ) Rajiv Kumar65

1.Schemes should be provided to the customers not to the

whole sellers.

2.Accessories should be provided on the basis of sale.

3.Check the selling of whole sellers at lower price than

agency.

4.Agency should be more honest in providing benefits to

retailers.

5.Salary of sales force should be increased so they may

not do fraud with retailers to earn more.

6.Company should in advertisement in market to

increase sale inlocal areas.

7. efrigerator should provide to retailer because some

retailer have only own refrigerator .

8.Monthly inspection should be done to find out

problems of customers.


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1-An inspection officer should be recruited whoperform surprise inspection of the market and findout the problems.

2-Salary of the sales personals should be increasedso they may not indulge in fraud to retailers.

3-The vehicles of the agency should be inspected sothe delivery should be maintained.

4-The supply from the factory to the agency should

be good especially the brands like DEW.

5. board ,banner etc should provide to retailer alsotime to time check it.


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My Project gives me the true knowledge of customer relationship concepts &

also helped to understand the working environment of the Pepsico.

The major thing, which I found in my whole project, is as follow:

The market share of Pepsico is more than Coke

The distribution channel of both company is very bad.

Advertising policy of Pepsi is better than Coca Cola.

Retailers are highly dissatisfied with salesmen behavior.

Company relation with retailers is credit based.

There are very less effort for promoting sales.

There are no direct communication between retailers and company.

Retailers are not aware about company scheme and product

development.

Scheme is not distributed honestly among retailers.


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www.google.com

www.Pepsicoindia.com

www.Pepsico.com

Philip Ko l r,Marketing Management, Twelfth Edition.

Paul E. Green, Donald S. Tull and Gerald Albaum-

Research For Marketing Decision,

G.C. Berry , Marketing Research


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S.No Shop name Address Contact No. Advertisement condition

Fridge warm stock cold stock

Pepsi coke pepsi coke Pepsi coke

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

2627

28

29

30


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Documents

PEPSI Report File