Principle of Marketing

MOHAMMAD ALI JINNAH UNIVERSITY

ISLAMABAD

PROJECT REPORT

MBA Section 3

Group Members

JALAL UD DIN MB091027

WAQAS MEHMOOD MB091028

AHMAD NAWAZ MB091010

MUHAMMAD RAFEH MB091022

SHAHBAZ KHAN MB091046

SUBMITTED TO: MS. SIDRA PARACHA

SUBMITTED BY: MARKETING SOLUTIONERS

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DEDICATION

We would like to dedicate this project to our parents who has given us opportunity to study

here in MAJU, and to our respected teachers who give us a chance to work on this project.

TABLE OF CONTENTS

Acknowledgement---------------------------------------------------------------------------6

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Abstract ---------------------------------------------------------------------------------------7

Chapter One Introduction ---------------------------------------------------------------8

1.1 Introduction ---------------------------------------------------------------------8

1.2 History -------------------------------------------------------------------------8-9

1.3 Pepsi Headquarter ---------------------------------------------------------------9

1.4 Board of Directors -----------------------------------------------------------9-10

1.5 Mission ---------------------------------------------------------------------------10

1.6 Vision -----------------------------------------------------------------------------11

1.7 Pepsi Objectives -----------------------------------------------------------------11

1.8 Background and Objectives of Research --------------------------------11-12

1.9 Method Use in this Research --------------------------------------------------12

1.10 Conclusion ----------------------------------------------------------------------12

Chapter Two Literature Review ----------------------------------------------------------13

2.1 Introduction -----------------------------------------------------------------------13

2.2 Pepsi in Pakistan ------------------------------------------------------------------13

2.3 Haidiri Beverages Pvt Ltd ----------------------------------------------------13-14

2.4 Production Process ----------------------------------------------------------------14

2.5 Consumer Behavior----------------------------------------------------------------14

2.5.1 Culture -------------------------------------------------------------------15

2.6 Branding ---------------------------------------------------------------------------15

2.7 Conclusion -------------------------------------------------------------------------15

Chapter Three Research Methodology ----------------------------------------------------16

3.1 Introduction ------------------------------------------------------------------------16

3.2 Marketing Research ---------------------------------------------------------------16

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3.2.1 Primary and Secondary Date------------------------------------------17

3.3 Conclusion-----------------------------------------------------------------------------------17

Chapter Four Data Analysis and Finding-------------------------------------------------18

4.1 Introduction-------------------------------------------------------------------------18

4.2 Marketing Strategy ----------------------------------------------------------------18

4.2.1 Geographic --------------------------------------------------------------18

4.2.2 Demographic ------------------------------------------------------------18

4.2.3 Psychographic---------------------------------------------------------- -18

4.2.4 Behavioral----------------------------------------------------------------19

4.3 4P’s and 4C’s -----------------------------------------------------------------------19

4.3.1 Products -------------------------------------------------------------------19

4.3.2 Prices ----------------------------------------------------------------------20

4.3.3 Places----------------------------------------------------------------------20

4.3.4 Promotion-------------------------------------------------------------20-21

4.4 4C’s ----------------------------------------------------------------------------------21

4.4.1 Consumer------------------------------------------------------------------21

4.4.2 Cost-------------------------------------------------------------------------21

4.4.3 Convenience---------------------------------------------------------------21

4.4.4 Communication -------------------------------------------------------- 22

4.5 Market Share--------------------------------------------------------------------------22

4.6 Conclusion ----------------------------------------------------------------------------22

Chapter Five SWOT Analysis and Pepsi ----------------------------------------------------23

5.1 SWOT Analysis ----------------------------------------------------------------------23

5.1.1 Strength ----------------------------------------------------------------------------- 23

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5.1.2 Weakness -------------------------------------------------------------------------- -23

5.1.3 Opportunities ------------------------------------------------------------------------24

5.1.4 Threats -------------------------------------------------------------------------------24

5.2 Ingredients --------------------------------------------------------------------------- -24

5.3 Market Description ---------------------------------------------------------------24-25

5.4 Slogans ---------------------------------------------------------------------------------25

5.5 What’s in Pepsi? ----------------------------------------------------------------------25

5.6 Competitors ---------------------------------------------------------------------------26

5.7 Distribution Review --------------------------------------------------------- --------26

5.8 Placing Distribution --------------------------------------------------------------26-27

5.9 Soft Drinks in Pakistan --------------------------------------------------------------27

5.10 Top ten Soft Drink Selling --------------------------------------------------------28

Chapter Six Conclusion -------------------------------------------------------------------------29

Reference ------------------------------------------------------------------------------------------30

Appendix

ACKNOWLEDGEMENT

First of all we are thankful to Almighty ALLAH for giving us much cooperation and

supporting parents who has given us this opportunity to study here. I would like to thank Ms.

Sidra Paracha for giving us the confidence and opportunity to prove ourselves.

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ABSTRACT

Pepsi-Cola is a carbonated beverage that is produced and manufactured by PepsiCo. It is

sold in stores, restaurants and from vending machines. The drink was first made in the 1890s

by pharmacist Caleb Bradham in New Bern, North Carolina. The brand was trademarked on

June 16, 1903. There have been many Pepsi variants produced over the years since 1903,

including Diet Pepsi, Crystal Pepsi, Pepsi Twist, Pepsi Max, Pepsi Samba, Pepsi Blue, Pepsi

Gold, Pepsi Holiday Spice, Pepsi Jazz, Pepsi X (available in Finland and Brazil), Pepsi Next

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(available in Japan and South Korea), Pepsi Raw, Pepsi Retro in Mexico, Pepsi One, and

Pepsi Ice Cucumber in Japan.

Pepsi cola is situated is an Industry that is dominator by two Competitors Coca Cola and

of course themselves. Although Pepsi and Coke basically go after all consumers who

purchase soft drink beverage Coca Cola targets it product at the head of household.

According to the beverage digest the customer base for soft drinks is whopping 95% of

regular user in United States. This represents the large number if potential customers for

Pepsi Cola.

The Pepsi's advertising the campaigns are referring to the markets that marketers refer to

as Generation X. The Generation X consumer is profiled to be between the age of 18 to 29.

They have high expectations in life and very active. They adopt a lifestyle of living for today

and not worry about long term goal. They also have a focus on the 12 to 18 year old market.

INTRODUCTION

1.1 INTRODUCTION

Pepsi-Cola was first made in New Bern, North Carolina in the United States in the

early 1890s by pharmacist Caleb Bradham. On August 28, 1898 , "Brad's drink" was changed

to "Pepsi-Cola" and later trademarked on June 16, 1903

Caleb Bradham bought the name "Pep Kola" from a local competitor and changed it

to Pepsi-Cola. "Pepsi-Cola" is an anagram for "Episcopal" - a large church across the street

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Chap1

from Bradham's drugstore. Caleb Bradham and his customers simply thought the name

sounded well or the fact that the drink had some kind of "pep" in it because it was a

carbonated drink; they gave it the name "Pepsi".

As Pepsi was initially intended to cure stomach pains, many believe Bradham coined the

name Pepsi from either the condition dyspepsia (stomachache or indigestion) or the possible

one-time use of pepsin root as an ingredient (often used to treat upset stomachs). It was made

of carbonated water, sugar, vanilla, rare oils, and kola nuts. Whether the original recipe

included the enzyme pepsin is disputed.

www.pepsi.com

1.2 HISTORY

Pepsi is a world leader in convenient snacks, foods and beverages. Its revenue is more than

39 billion Dollars and over 185, 000 employees. The company consists of Pepsi Co Americas

Foods (PAF), Pepsi Co Americas Beverages (PAB) and Pepsi Co International (PI) Pepsi Co

Americas Foods includes all Latin America Food and snacks businesses and all business in

Mexico. Pepsi Co America Beverages includes Pepsi Co Beverages all North America and all

Latin American Beverage Businesses. Pepsi Co International includes in the United

Kingdom, Europe, Africa Middle East and Asia. Pepsi Co Brands are available in 200

Countries .Some of the Pepsi Co Brands names are more than 100 year old but the

corporation is relative young. Pepsi Co was founded in 1965. Pepsi and Coca cola merge

with each other and the name of the product is Pepsi Cola. Pepsi Co merged with the Quaker

oats Company in 2001.

www.scribd.com

1.3 PEPSI HEADQUARTER

Pepsi Headquarter is located in New York. The Seven Building Headquarter is designed by

Edward Durrell Stone.

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www.scribd.com

1.4 BOARD OF DIRECTORS

PepsiCo’s business strategy and affairs are overseen by the Board of Directors, which is

comprised of two executive directors and ten independent outside directors. Only

independent outside directors make up our three standing Board Committees,

1) Nomination and Corporate Governance

2) Audit

3) Compensation.

Victor J. Dzau, M.D.

Indra K. Nooyi Arthur C. Martinez

Dina Dublon Lloyd Trotter Ray L. Hunt

Michael D. WhiteSharon Percy Rockefeller Alberto Ibargüen

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Daniel Vasella James J. Schiro Ian M. Cook

www.pepsi.com

1.5 MISSION

"To be the world's premier consumer products company focused on convenient foods and

beverages. We seek to produce healthy financial rewards to investors as we provide

opportunities for growth and enrichment to our employees, our business partners and the

communities in which we operate. And in everything we do, we strive for honesty, fairness

and integrity."

www.pepsi.com

1.6 Vision

Pepsi co’s responsibility is to continually improve all aspects of the world in which we

operate environment, social, economic-creating a better tomorrow then today. We believe

sustainability lives at the instruction of public and corporate interest. It encompasses citizens

and corporate social responsibility, which are about doing the right things for the society and

for the business. It encompasses the heath of the company, which is about fulfilling our

mission of creating financial rewards and growth. We have articulated what we stand for and

the core values we are committed to support.

www.pepsi.com

1.7 OBJECTIVES

The Objectives that the Pepsi Company wishes to achieve is that it wants to remain and

continue to be the best or number one beverage company in Pakistan. As Pepsi is already the

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number one beverage company in Pakistan but it has to maintain its position power and status

to in order to achieve their target market

1.8 Background and Objectives of the Research

We visit the Pepsi Industry (Haidiri Beverages Pvt Ltd.) because we want to know that what

the Marketing Strategy of Pepsi is for its customer. How Pepsi Industry apply 4P’s and 4C’s

and how they deal with customer and how they introduced its product in the market. The

main theme of this research is related to all Marketing Operation. Through this visit we do

SWOT analysis of Pepsi. We chose this industry because it has strong marketing strategy.

Our Objectives is to learn about Pepsi’s marketing management and relationship with its

customers. Our main objective is how a marketer handled all the marketing Operations.

1.9 Method use in this Research

We adopted the following methods in this research

Visit

Interviews

Questionnaires

Internet

1.10 Conclusion

In this chapter we study the history of Pepsi and also studying headquarter of Pepsi. We

mention the objectives and background of the research. That what is Pepsi how it makes. We

mention method of research and also the aim of the research, in this chapter.

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LITERATURE REVIEW

2.1 Introduction

In this chapter the data which we collect from using Internet, survey,

2.2 Pepsi in Pakistan

In Pakistan Pepsi was introduced in 1979, in the beginning Pepsi did face a lot of problem because at

that time Coca Cola had 72% market share.

However in 1980 Pepsi was offered as a franchise agreement with the Coca Cola company, which

they did accept and there after it came to be known as Pepsi Cola.

www.pepsi.com

2.3 HAIDIRI BEVERAGES PRIVATE LIMITED

The haidiri beverages company was established in 1979. It is the Pepsi's Sole selling Agent in

Rawalpindi and Islamabad. It is based in the CDA industrial triangle, Kahuta Road

Islamabad. It manages the supply for several wholesalers, Retailers, Restaurants, Hotels and

other Food outlets. In order to achieve the projected Sales target effective. Haidiri Beverage's

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Chap2

primary functions are to conduct a systemic manufacturing and supply of product. It has

setup a best manufacturing plant and storage plant in Rawalpindi with multiple production

unit and huge Production Capacity. Haidiri Beverages has different Departments for dealing

such as Marketing Department, Human Resource Management Department, Production

Department, Information Technology Department, Finance Department and Supply Chain

Process.

Reference: Malik Mohammad Imtiaz Production Manager

2.4 Production Process

Haidiri Beverages produced the large number of product in a day. The production criteria are

on demand as well as the market situation. They produced 35, 000 cane per hour and 20, 000

disposal bottles per hour and the machinery run 22 hour in a day.

Reference: Malik Mohammad Imtiaz Production Manager

2.5 Consumer Behavior

Consumer behavior is a key success of any Company. Consumer behavior is depending upon

culture, value, traditions. When marketers offer unique benefits in a new product they

encourage consumer to subtype. If successful marketer established a dominant position in a

new sub category. When Pepsi Co introduced a new product in a market it will change the

consumer behavior. When Pepsi attempted to introduce another category breakfast cola’s by

introduced Pepsi AM, it was less successful.

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http://books.google.com.pk/books

2.5.1 Culture

The soft drinks market in Pakistan enjoys dynamic growth in both volume and value terms.

Carbonated drinks have become part of the culture in Pakistan and multinational companies

have maintained standards over the years to provide the nation with high-quality drinks.

Rural areas of Pakistan have driven sales of carbonated drinks to new heights as more than 60

percent of the population resides in rural areas and young consumers are more attracted to

advertising. Pepsi is the most popular and leader brand in the Pakistani market and is

consumed by children and adults alike. Pepsi is a responsible corporate brand of Pakistan and

have contributed a lot to the economy.

2.6 Branding

There are a number of branding strategies Generic Brand Strategy, Individual Brand Strategy,

Family Brand Strategy, Manufacturing's Brand Strategy, Private Brand Strategy and Hybrid

Brand Strategy. Individual Brand Strategy is Marinda, 7up and Pepsi etc. they may presented

as different line but it operate as under the name of Pepsi.

2.7 Conclusion

In this chapter we study the establishment of Pepsi Industries in Pakistan. The Haidiri

Beverages Pvt. Ltd is very famous name in Pepsi Industries. In this chapter we know a

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branding Strategy of Pepsi and also studying the Consumers behavior, Culture and value of

the Consumers in Pakistan.

RESEARCH METHODOLOGY

3.1 Marketing research

When attempting to implement a new market plan a business must address to its target

marketing and conduct the reverent information to insure the new marketing plan. When

conduct a marketing research the business must 1st defined the problem and then gathering

the appropriate information to solve these problem. There are three types of information a

business can gather to solve its problems.

1. Exploratory Research

In this research the business clarifies the problem and the find the ways to address it.

2. Descriptive Research

In this research the business measure and describe the product characteristic of the

target market.

3. Causal research

In this research the business used to test the hypothesis about the cause and effect

relationship.

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Chap3

Pepsi through its market research has addressed all three types of research to define the

problem raised by shareholder and gathered information to serve their needs.

3.3 primary and secondary Data

3.3.1 Primary Data

We collect the primary data by using the following methods

Interviewing

Questioners

Visit

3.3.2 Secondary Data

Secondary data are those data which is already given. We collect the secondary data by using

these Methods

Internet

TV Commercials

Broachers

Flyer

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DATA ANALYSIS AND FINDING

4.2 MARKETING STRATEGY

4.2.1 Geographic

World Region Asia

Country Pakistan

City All Major city of Pakistan

Climate Hot and Dry

4.2.2 Demographic

Age 14-30+

Gender Male, Female

Marital Status Married, Unmarried

Family Size 1-2, 3-4, 5+

Education School, College, universities

Occupation For Middle class to Upper Class

Income Rs. 10, 000 +

Nationality Pakistani

4.2.3 Psychographic

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Chap4

Social Class Middle Class, Upper Class

4.2.4 Behavioral

Occasion Party, birthday and regular

Occasion

Position Status Strong

Benefits Quality, Taste

4.3 4P’s and 4C’s:

PRODUCT CONSUMER

PRICE COST

PLACE CONVENNIENCE

PROMOTION COMMUNICATION

4.3.1 Products

Pepsi

Diet Pepsi

Pepsi Twist

7 Up

Diet 7 Up

7 Up Cherry

Mirinda (Orange & Apple)

Mountain Dew

Aquafina

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4.3.2 Prices

Pepsi has adopted a market pentration price at the time when it was introduced. Coca cola

covered the large market in Pakistan but now the price of Pepsi cola is same as of its

competitors

250 ml bottle……………………….…….. Rs. 15

250 ml disposable bottle…………………..Rs. 22

Can………………………………………...Rs. 35

1 liter (not disposable)……………………..Rs 50

1.5 liter (Super Pack)..…………………….Rs. 65

2.25 liter (Jumbo Pack)……………………Rs. 130

Reference: Personal Survey

4.3.3 Places

Pepsi cola is available in more then 191 countries. Pepsi has 730 plants working correctly

around the world and in USA and Canada 200 plants are working there rest 530 are working

in other countries of the world as well as working in Pakistan.

4.3.4 Promotion

Pepsi does its promotion through media; electronic media as well as print media through

flyers, by sponsoring cricket matches and in many other places. Promotion is also done

through print media e.g. newspapers are design of Pepsi can. The first of many new designs

of Pepsi were released in 2007.

The Pepsi have signed some agreements with a very strong and expanded retailers such as

Pizza hut and KFC when you go to Pizza hut or KFC you will find only the Pepsi products

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and nor its competitors products. These agreements are based on the Incentives that Pepsi

offers to these retailers.

Pepsi has continued using product endorsement by using TV Actors/ Models and cricketers

in order to promote their Products.

4.4 4C’s

4.4.2 Cost

250 ml bottle………….………………………..……Rs. 7

Can…………………………………........................Rs. 23

250 ml disposable bottle...........................................Rs. 11

1 liter (not disposable)……………………….……..Rs 42

1.5 liter……………………………………………..Rs. 70

2.25 liter……………………………………………Rs. 88

Reference: Sir Imtiaz Production Manager

4.4.3 Convenience

It has most effective distribution system among all the soft drinks. It is easily available

everywhere even in cities or a village. You can easily get it. Special refrigerators are placed

at each and every shop or outlet.

4.4.4 Communication

Internet

Phone Call

Surveys.

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4.5 Market share

http://www.wikinvest.com/images/8/8c/PBGcomp.jpg

4.6 Conclusion

This chapter is all about the marketing Strategy. In this chapter we studied the geographic,

demographic, Psychographic and behavioral Strategy and also studying about the 4P’s and 4C’s and

market share of the Pepsi compare with other beverages industries.

SWOT ANALYSIS AND PEPSI21

Chap5

5.1SWOT ANALYSIS

Strengths Weaknesses

Brand Strength

Effective step in new market

Result of Operation

Strong Existing Distribution Channels

Reliant upon line extensions

Reliant upon particular carbonated drink

Opportunities Threats

New Brands Introduction

Brands is attractive in global Partner

Strong Competition

Potential Health Issues Free Trade

5.1.1 Strengths

The Pepsi image is displayed on T-shirt, Cap and Bat this extremely recognizable branding is

one of the greatest strengths. Pepsi bottling system is one of their greatest strengths.

5.1.2 Weaknesses

Pepsi has recently reported some declines in unit case volume in Indonesia and Thailand due

to reduce the consumer Purchasing power. Pepsi has effects on the teeth which is an issue for

health care.

5.1.3 Opportunities

Packing Changes is effected sales and industry positioning but in general, the public has

tended not to be affected by new product. Pepsi's bottling system also allows the company to

take advantage of infinite growth opportunities around the world.

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5.1.4 Threats

Consumer buying power is represents a key threats in the industry. The competition between

Pepsi and Coke has produce a very slow moving industry in which management must

continuously respond to the changing attitudes and demand for their of face losing market

share to competition, furthermore consumer can easily switch to other beverage with a little

cost.

5.2 Ingredients

Carbonated water.

Sugar

High fructose corn syrup.

Color (Caramel)

Phosphoric acid.

Caffeine.

Emulsifier

Natural flavors.

Reference: Malik Muhammad Imtiaz Production Manager

5.3 MARKET DESCRIPTION

Pepsi has become the largest selling soft drink in the world. It has liked by the people of all

ages belonging to different field of life belonging different cast religion.

A recent survey shows about the 90% of the population of the world use Pepsi. It available in

the market in different Flavor and different variety.

5.4 SLOGANS

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One of the main reasons of the popularity of the Pepsi is to use slogan to attract the customers

Different Slogans have been used in different countries to attract different kind of people in

all over the world.

In Pakistan they use number of slogan to attract the customers. Some slogan which is used in

Pakistan are "YEH DIL MANGY MORE", "DIL HAI TO MANGO MORE" and

"PEPSIFY KARO GAY" etc.

5.5 WHAT IS IN PEPSI?

www.scribd.com

5.6 Competitors

Pepsi is the largest beverage company in Pakistan with 65% market shares. In 1994 the Coca

cola Company reduced the price to Rs.5 and Pepsi has to reduce the price in order to

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compete. In doing this both companies had bear a huge losses. Coke had a loss of 9 million

whereas the Pepsi bearing a loss of 14 million.

The following are some competitors of the Pepsi

Coca cola

Amrat cola

Murre Brewery

Nestle(only in mineral water)

5.7 Distribution Review

Pepsi applied two methods to distribute their products.

5.7.1 Direct Distribution:

Pepsi Direct distribute their Product to Whole Sellers, Restaurants, Hotels, Pizza hut,

KFC, Saver Food and Metro etc.

Export Parties

5.7.2 Indirect Distribution

Through Base market Distributions

Through Outstation Distributors

Reference: Malik Mohammad Imtiaz

5.8 Placing Distribution

The distribution system of Pepsi Cola Company is organized as follows

There are branches in every city of Pakistan and these branches are controlled by the head

branches which is located in Karachi. There is some Sales Manager and sales executives. The

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sales executive is also known as Territory Development Manager (TDM) who is responsible

about the trucks. Then further down is the sales officer who has a wide authority and then

there is a sales supervisor who looks after the trucks and finally salesman. Each sales

manager handles 60 trucks. The distribution agencies are formed in every large city of

Pakistan. The trucks of the company supplies products to these distribution agencies and then

these agent further supplies these products to the retailers.

Before delivering the products some certain guiding Principles are followed by Pepsi Co

Applicant must have 20-25 vehicles (Depending on the Area).

Applicant must have 20, 000 Cases of Empty Bottles.

Applicant must Deposit Rs. 1, 000, 000 as a security.

5.9 Soft drinks in Pakistan

There are various kind of soft drink used in Pakistan Such as

Pepsi

Coca Cola

Amrat Cola

Rooh Afza

Pakola

Gourmet Cola

Mazza Juice

http://archaeology.about.com

5.10 Top Ten Selling Soft drinks

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http://money.cnn.com/2005/03/07/news/fortune500/cokepepsi_sales/

CONCLUSION

Pepsi has a long-standing commitment to protecting the consumer whose trust and

confidence in its products in the bedrock of its success. In order to ensure that

Consumers stay inform about the global quality of all Pepsi product sold in the world,

Pepsi product carry a quality assurance seal on them. Pepsi commitment is to deliver 27

sustained growth, through empowered people, acting with responsibility and building

trust.

Reference:

Imtaiz M Malik Production Manager

Shoukat M Assistant Manager Advertising ang Key Accounting

Chaudhry A Mohammad General Manager

Survey and TV Commercials

Magazine

Internet:

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(WWW)URL:<http://www.pepsi.co.uk/>

(WWW)URL:<http://www.pepsi.com/>

(WWW)URL:<http://www.pepsico.com/>

(WWW)URL:<http://www.aip.de/pepsi/>

(WWW)URL:<http://www.sirpepsi.com/pepsi11.htm>

(WWW)URL:<http://www.scribd.com/>

(WWW)URL:<http://www.wikinvest.com/images/8/8c/PBGcomp.jpg>

(WWW)URL:<http://www.contrib.andrew.cmu.edu/%7Ejwilder/pepsi.jpg>

(WWW)URL:<http://images.google.com.pk/imgres?imgurl=http://www.brandsaward.com/

2008/images/

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