ASummer Training Report

On

“Coke V/s Pepsi Market Share

Submitted in partial fulfillment for the requirement of the award of degree in

Master of Business Administration

SUBMITTED TO: SUBMITTED BY:Ms. POONAM SINGH ASHISH DIXIT (Faculty) Roll No. 0823170403

MBA (3th Sem.)

R.D. ENGINEERING COLLEGE GHAZIABAD

ACKNOWLEDGEMENT

The opportunity of research with the help of Mr. Ashish Khandalwal (Marketing

Manager) to very professional and experience Work for me..

It is not only gave me practical and analytical experience but also contributed largely in

laying the foundation for concern the fields of marketing and the information about very

large and glamour war between the two big cola companies.

.

I wish to express my profound gratitude to my faculty Ms. Famina (Faculty) who gave me

an opportunity to undergo summer training and who gave a patient hearing and support. Thus

increasing my knowledge and understanding the various facts and function of the soft drink

industry.

.

ASHISH DIXIT

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PREFACE

Marketing is too important to be left to the marketing department.

David Packard of Hewlett Packed.

The Indian market is getting to be consumer-led. This is the reason behind the unprecedented

boom in advertising. Below the line marketing activities, fast distribution system and more

sophisticated consumer research.

On the media front, satellite proliferation has trigged of a new genre of media research,

which is highly viewer ship based. Consumer satisfaction has become research worthily

Multinationals are pouring in precisely because of this new chapter in Indian consumerism.

The dilemma that all marketers are facing is getting the maximum done in the minimum

possible time. And with brand loyalty becoming a thing of the past, given the choice

available to the consumer pull. The consumer could be a purchaser of end products, or a

financial investor, or even an industrial purchaser. Everywhere, there is a new thrust on

marketing and advertising.

The hyper activity in the market place is seeing a boom in support services, with a number of

independent agencies mushrooming to provide them. Co-related to the market book, services

are well on their to becoming a major industry.

The creative leap is increasingly being governed by market realities and consumer research.

And Clint interface is no longer limited to the Clint service people, but including all

specialists in agencies.

The entry multinational products in to the country are seeing more emphasis aid world- class

quality. This along with the loosening of regulations is seeing

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export gaining ground. From thinking along the lines of merely exporting spares and raw

material the exporters and now looking towards finished products. A multiplier to this are the

joint venture companies looking at becoming export manufacturing bases.

The scene has moved beyond the threshold of global presence, inward and out ward.

However, there are certain issue still dogging an unhindered move forward something bound

to happen when the economy is just opening up. These need to be addressed. Nonetheless,

India has taken the irrevocable step forward in becoming a part of the global family. And in

the process of growth, there are already and will be in future, quantum jumps in progress.

ASHISH DIXIT

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10 ANALYSIS

11 BRAND PREFERENCES

12 FINDINGS AND ANALYSIS

13 PUBLIC RELETION ANGLE

14 CONCLUSION

15 RECOMMANDATIONS

16 BIBLIOGRPHY

17 QUESTIONNAIRE

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OBJECTIVE OF THE STUDY

To find out the market plan of the company over the competitors.

To analyze the market share of COKE.

To study the consumer preference about COKE.

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EXECUTIVE SUMMARY

This project is an extensive research on the marketing strategies of the two

Cola giants Pepsi and Coca Cola. It covers an extensive survey and depict all

graphs, fact and figures of two companies. It begins with the introduction of

soft drink industry and introduction of these two companies of soft drink

industry. It covers some of the major strategies adopted by Pepsi and Coca-

Cola like their pricing policy, sales promotion and advertising policy,

distribution policy etc. The project has been made interesting with the

inclusion of the topics, which covers the 4P’s of marketing.

The major players in the soft drink industry in India are Coke and Pepsi.

Pepsi holds the major market share followed by Coke. They have a cut

throat competition between themselves. Whatever strategy is followed by

one company, it is copied by the other.

Sample of to brands were selected on the basis of there uses and

noticeciability.

One of the selected brand are NO1 brand in their respective product

categories the other one brand is close competitor of the No 1 brands. Total

sample of size of 200 respondents selected on the basic of convenience was

surveyed which include consumers.

Data was collected from secondary as well as primary sources.

Structure questionnaire was use to collect primary data

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INTRODUCTION:

In the modern urban culture consumption of soft drinks particularly among

younger generation has become very popular. Soft drinks in various flavors

and tastes are widely patronized by urbane population at various occasions

like dinner parties, marriages, social get together, birthday calibration etc.

children of all ages and groups are especially attracted by the mere mention

of the word soft drinks.

With the growing popularity of soft drinks, the technology of its production,

preservation, transportation and or marketing in the recent years has

witnessed phenomenal changes.

The so-called competition for this product in the market is from different

other brands. Mass media, particularly the emergence of television, has

contribute to a large extent of the ever growing demand for soft drinks the

attractive jingles and sport make the large audience remember this product at

all times.

It is expected that with the sort of mass advertising, reaching almost the

entire country and offering various varieties annual demand for the product

is expected to rise sharply in the times to come.

In any marketing situation, the behavioral / environmental variables relating

to consumers, competition and environment are constantly influx. The

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competitors in a given industry may be making many tactical maneuvers in

market all the time. The may introduce or initiate an aggressive promotion

campaign or announce a price reduction. The marketing man of the firm has

to meet all these maneuver and care of competitive position of his firm and

his brand in the market. The only route open to him for achieving this is the

manipulation of his marketing tactics.

In today’s highly competitive market place, three players have dominated

the industry; The New York based Pepsi Company Inc. The Atlanta based

coca- cola and U.K. based Cadbury Schweppes.

Through the globe, these major players have been battling it out for a bigger

chunk of the ever –growing soft drink market. Now this battle has been

evolved up to India too with the arrival of these three giants.

Soft drink industry is on amazing growth; ultimately these are only one

person who will determine their fortunes. The Indian consumer. The real

War to quench his thirst has just begun.

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SOFT DRINK INDUSTRY: AN OVERVIEW

It all began in 1886, when a tree legged brass kettle in Hohn Styth

pemberton’s backyard in Atlanta was brewing the first P of marketing leged.

Unaware the pharmacist has given birth to a caromel colored syrup, which is

now the chief ingredient of the world’s favorite drink. The syrup combined

with carbonated the soft drink market. It is estimated that this drink is served

more than one thousand million times in a day.

Equally oblivious to the historic value of his actions was Frank Ix.

Robinson, his partner and book keeper. Pemberton & Robinson laid the first

foundation of this beverage when an average nine drinks per day to begin

with, upping volumes as sales grew.

In 1894, this beverage got into bottle, courtesy a candy merchant from

Mississippi. By the 1950’s Colas were a daily consumption item, stored in

house hold fridges. Soon were born other non- cola variants of this product

like orange & Lemon.

Now, the soft drink industry has been dominated by three major player – (1)

The New York based Pepsi co. Inc.(2) The Atlanta based coca cola co. (3)

The united Kingdom based Cadbury Schweppes.

Though out the glove these major players have been battling it. Out for a

bigger chunk of the ever-growing cold drink market. Now this battle has

begun in India too. Inida is now the part of cold drink war. Gone are days of

Ramesh Chauhan, India’s one time cola king and his bouts of pistol

shooting. Expect now to hear the boon of cannons when the Coca Cola &

Pepsi co. battle it out for, as the Jordon goes a bigger share of throat. By

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buying over local competition, the two American Cola giants have cleared

up the arena and are packing all their power behind building the Indian

franchisee of their globe girdling brands. The huge amount invested in

fracture has never been seen before. Both players seen an enormous

potential in his country where swigging a carbonated beverage is still

considered a treat, virtually a luxury. Consequently, by world standards

India’s per capita consumption of cold drinks as going by survey results is

rock bottom, less than over Neighbors Pakistan & Bangladesh, where it is

four times as much.

Behind the hype, in an effort invisible to consumer Pepsi pumps in Rs 3000

crores (1994) to add muscle to its infrastructure in bottling and distribution.

This is apart from money that company’s franchised bottles spend in

upgrading their plants all this has contributed to substantial gains in the

market. In colas, Pepsi is already market leader and in certain cities like

Banaras , Pepsi outlets are on one side & all the other colas put together on

the other. While coke executive scruff at Pepsi’s claims as well as targets,

industry observers are of the view that Pepsi has definitely stolen a march

over its competitor coke.

Apart from numbers, Pepsi has made qualitative gains. The foremost is its

image. This image turnaround is no small achievements, considering that

since it was established in 1989, taking the hardship route prior to

liberalization and weighed down by export commitments.

Now, at present as there are three major players coke, Pepsi and Cadbury

and there is stiff competition between first two, both Pepsi and coke have

started, sponsoring local events and staging frequent consumer promotion

campaigns. As the mega event of this century has started, and the marketers

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are using this event – world cup football, cricket events and many more

other events.

Like Pepsi, coke is picking up equity in its bottles to guarantee their

financial support; one side coke is trying to increase its popularity through.

Eat Food, enjoy Food. Drink only coca cola. Eat cricket, sleep cricket.

Drink only coca cola. Eat movies, sleep movies. Drink only coca cola.

On the other side of coin Pepsi has introduced AMITABH BACHHAN for

capturing the lemon market through MIRINDA – Lemon with “ zor ka

jhatka dhere se lage”.

But no doubt’ that UK based Cadbury is also ecognising its presence. So

there is a real crush in the soft drink market.with launch of the carbonated

organize drink Crush, few year ago in Banaras ., the first in a series of a

launches , Cadbury Schweppes beverage India (CSBI) HAS PLANNED:-

The world third largest soft drink marketers all over the country.CSBI o

wholly owned subsidiary of the London based $ 6.52billion. Cadbury

Schweppes is hoping that crush is going well and well not suffer the same

fate as the Rs. 175 crore Cadbury india’s apple drink Apella. CSBI is now

with orange (crush), and Schweppes soda in the market.

As orange drinks are the smallest of non-cola categories that is Rs. 1100

crore market with 10% market share and cola heaving 50% is followed by

Lemon segment with 25%.

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The success of soft drink industry depends upon 4 major factors viz.

Availability

Visibility

Cooling

Range

AVAILABILITY

Availability means the presence of a particular brand at any outlet. If a

product is now available at any outlet and the competitor brand is

available, the consumer will go for the at because generally the

consumption of any soft drink is an impulse decision and not

predetermined one.

VISIBILITY

Visibility is the presence felt, if any outlet has a particular brand of soft

drink say- Pepsi cola and this brand is not displayed in the outlet, then its

availability is of no use. The soft drink must be shown off properly and

attractively so as to catch the attention of the consumer immediately Pepsi

achieves visibility by providing glow signboards, hoarding, calendars etc.

to the outlets. It also includes various stands to display Pepsi and other

flavours of the company.

COOLING

As the soft drinks are consumed chilled so cooling them plays a vital role

in boosting up the sales. The brand, which is available chilled, gets more

sale then the one which is not, even if it is more preferred one.

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RANGE

This is the last but not the least factor, which affects the sale of the

products of a particular company.

Range availability means the availability of all flavors in all sizes.

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COMPANY PROFILE

Keeping in view of tapping the Indian soft drink market and also developing

soft drinks as a drinking product among Indians. The Coca-Cola in India has

setup an independent organizations which is H.C.C & B.C.C with a capital

of 350 U.S.$ each by virtue of sellout decision of the passed managing

director Sh. S. C. Aggarwal.

Hindustan Coca-Cola bottling (N-W) Pvt. Ltd. Najibabad took the complete

possession of this plant, land, machinery, & intellectuals on February 14’

1998 and since then H.C.C, looking after all its affairs under company

owned bottling plant to establish integrated marketing system in the area.

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CORE BRANDS :

Coca-Cola: Developed in a brass pot in 1886, coca-cola is the most

recognized and admired trademark around the globe. Not to mention the

best selling soft drink in the world.

Sprite: In 1961, a citrus-flavored drink made its U.S debut, using

“Sprite Boy “as inspiration for its name. This elf with silver hair and a big

smile was used in 1940s advertising for Coca-Cola. Sprite is now the fastest

growing major soft drink in U.S and the world’s most popular lemon-lime

soft drink.

Fanta : The name “fanta “ was first registered as a trademark in Germany

in 1941 ,when it was used for a few year for a soft drink created from

available materials and flavors . The name was then revived in 1955 in

Naples, Italy, when it was used for the:” fanta “orange drink we know today.

It is now the trademark name for a line of flavored drinks around the world.

Diet coke: The extension of the coca-cola name began in 1982 with the

introduction of diet coke (also called coca-cola light in some countries). Diet

coke quickly become the number – one selling low –calorie soft drink in the

world.

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BRAND IN INDIAN ORIGIN

GOLD SPOT: this orange cardonate soft drink was introduceB in the early

1950c, and acquired by the coca-cola company in 1993, its tangy taste has

been popular with Indian teenagers

LIMCA: It is thirst-quenching beverage features a fresh and light lemon-lime

taste and lighthearted attitude. The limca brand was introduced in 1971 and

acquired by the coca-cola company in 1993.

MAAZA: Maaza, launched in 1984 and acquired by the coca-cola company

in 1993, is a non carbonated mango soft drink with a rich, juict & natural

mango taste.

THUMPS UP: in 1993, the coca-cola company acquired this brand, which

was originally introduced in 1977. Its strong and fizzy taste makes it unique

carbonated Indian cola.

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BRAND IN INDIAN

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ADVERTISEMENT AND PUNCH LINE OF COCA-COLA

1936 - It’s The Refreshing Thing To Do .

1942 - It’s The Real Thing .

1943 - Global High Sign.

1959 - Be Really Refreshed.

1962 - Thing Go Better With Coke.

1969 - It’s the Real Thing.

1970 - I`D Like To Buy The World A Coke .

1976 - Coke Add Life .

1982 - Coke Is It .

1986 - Catch The Wave.

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1989 - You Can’t Beat the Feeling.

1993 - Always Coca-Cola

1998 - Eat Music, Sleep Music, And Drink Only

Coca-Cola.

1999 - Jo Chaho Ho Jaye Coca-Cola Enjoy.

2000 - I Want Hritik And I Want Coke.

2002 - Thanda Matlab Coca-Cola

2003 - Jiyo Thanda Piyo Thanda .

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FABULOUS FACTS ABOUT COCA-COLA

1. The world’s largest spherical coca-cola sign is in Nagoya, Japan a top the dial – Nagoya building in front of the Nagoya railway station. The sing is a double sphere constructed from more then 46 tone of steel, more 940meter of neon tubing, and more then, 879 light bulbs. The outer shape features the coca-cola logo and contour bottle, while the inner sphere portrays a comic scene with twinkling planets and stars.

2. One of the world’s largest signs for coca-cola is located on a hill called “ELHACHA” in America, Chile. It is 400 feet wide and 131 feet high and is made from 70,000, 26 ounce bottles.

3. The first out door paint sign advertising coca-cola still exists. It was painted in 1894 in Cartersville, Georgia.

4. Coca-cola is one of the world’s most recognizable trademarks recognized in countries that account for 98 percent of the world’s population.

5. If all the coca-cola ever produced were in 8- ounce bottles. And these bottles were distributed to each person in the world. There would be 678 bottles or over 42 gallons for each person.

6. If all the coca-cola ever produced were in 8 – ounce bottles, placed side by side and end to end to from a lane highway, it would wrap around the earth 82 times.

7. If all the coca-cola ever produced were flowing over Niagara fall at its normal rate of 105 million gallons per second instead of water, the falls would flow for about a day and a half 38 hours and 46 minutes.

8. the largest representation of the world’s best known package 100 foot tall glass contour bottle is located at world of coca-cola, LAS VEGAS

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HISTORY OF COCA-COLA

Jon Styth Pemberton first introduced the refreshing taste of Coca-Cola in Atlanta,

Georgia it was May 1861 when the pharmacist concocted a caramel colored syrup in

three–legged brass kettle in his backyard. He first distributed the new product by carrying

Coca-Cola in a jug cown enjoys in a glass of Coca-Cola at the soda fountain. Whether by

design or accident, carbonated water was teamed with the new syrup, producing a drink

that was proclaimed “Delicious and Refreshing”.

Dr. Pemberton’s Partner and bookkeeper, Mr. Frank Robinson,

suggested the name and penned as “Coca-Cola” in the unique flowing script

that is still famous worldwide today.

Dr. Pemberton’s sold 25 gallons of syrup, shipped in bright Red

wooden kegs. Red has been a distinctive color associated with the No.1 soft

drink brand ever since. For his efforts, Dr. Pemberton grossed $ 50 and

spent $ 73.96 on advertising, by 1891, Atlanta chemist as a G.Canler had

acquired complete ownership of the Coca-Cola business.

He purchases it from the Dr.Pemberton family for $ 2300. With in 4 year his

merchandising flair helped to expand the consumption of Coca-Cola to over

$25 million.

Robert W. woodruff become the president of the Coca-Cola company in

1923 and his more than six decades of leadership took the business of

commercial success making Coca-Cola an institution the world over. Coca-

Cola begins as a never tonic, but candy merchant Joseph A. Biedenharn of

Mississippi was looking for awry to serve refreshing beverages. He

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responded to this demand began offering bottle Coca-Cola using syrup

shipped from Atlanta, during a hot summer in 1894.

HISTORY IN INDIA

The coca-cola company reintroduced coca-cola in India on October 23, 1993, after an absence of 16 years. The coca-cola company received approval from the government in July 1996 to set up a holding company to invest US $ 700 million in downstream operation of beverages

In July 1997 the holding company was permitted by the government to operationally its bottling subsidiaries.

The bottling subsidiary currently owns and operates twenty-six bottling plants and sixty distribution centers across India. In addition, it uses 20 contract packers to augment its production capacity and cater to the increasing demand for its wide portfolio of beverage. PROMISE BY COCA-COLA

The coca-cola company exists to benefits and refresh every one it touches. The basic proposition of our business is simple , solid and timeless . when we bring refreshment , value , joy and fun to our stakeholders then we successfully nurture and protect our brand , particularly coca-cola . that is the key to fulfilling our ultimate obligation to provide consistently attractive to the owner so four business.

More then a billion times every day , thirsty people around the world reach for coca-cola products for refreshment. They deserve the highestQuality – every time . our promise to deliver that quality is the most important promise we make . and it involves a world-wide , yet distinctively local , network of bottling partner , supplier , distributor and retailers whose success is paramount to our own. Our investment in local communities in

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over 200 countries totals billions of dollars in jobs, facilities , marketing, the purchase of local good and services, and local business partnership. Always and every where , we pursue continuous innovation in the products we offer the processes we use to make them, the package we develop and the way we bring them to market .

Competitor of Coke

PEPSICO

PepsiCo is one the largest companies in the U.S. It figures amongst the

largest 15 companies worldwide according to the number of employees

hired. Its has a U.S. Fortune rank of 50.The company profits for 1997 were

$2.14 billion on revenues of $20.92 billion and Pepsi is bottled in nearly 190

countries.

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PepsiCo is a world leader in the food chain business. It consists of many

companies amongst which the prominent once are Pepsi-Cola, Frito-Lay and

Pepsi Food International. The group is presently into two of the most

profitable and profitable and growing industries namely, beverages and

snack foods. It has scores of big brands available in nearly 150 countries

across the globe. The group has established for itself once of the strongest

brands in various segments of its operations.

The beverages segment primarily markets its Pepsi, Diet Pepsi, Mountain

Dew and other brands worldwide and 7-UP outside the U.S. markets. These

are positioned in close competition with Coca-Cola Inc. of USA. A point

which is worth a mention is that Coca-Cola gets 80% of its profits for

International operations while the same figure for PepsiCo stands at 6%. The

segment is also in the bottling plants and distribution facilities and also

distributes the ready to drink tea products of Lipton in North America. In a

joint venture with orient spray juice products PepsiCo also manufactures

and distributes fruit juices.

The snack food division manufactures and distributes and markets chips and

other snacks worldwide. The international operations of this segment

extends to the markets of Mexico, the UK and Canada. Frito-Lay represents

this segment of PepsiCo.

The restaurant segment earlier primarily consists of the operations of the

worldwide Pizza Hut, Taco Bell and KFC chains. PFS. Pepsi Co’s restaurant

distribution operation, supplies company owned and franchise restaurants in

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the U.S. The company ventured into restaurant business with Taco Bell,

KFC, Pizza Hut ended last year when they were spinned off from the

company. A packaged goods company comprised of Pepsi-Cola Company

and Frito-Lay will continue to bear the PepsiCo name. The move should

enhance both corporations ability to prosper with their own fully dedicated

structure and management team.

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RESEARCH METHODOLOGY

METHODOLOGY

Research is a common language refers to a search of knowledge. Research is

scientific & systematic search for pertinent information on a specific topic,

infect research is an art of scientific investigation. Research Methodology is

a scientific way to solve research problem. It may be understood as a science

of studying how research is don’t scientifically. In it we study various steps

that are generally adopted by researchers in studying their research problem.

It is necessary for researchers to know not only know research method

techniques but also technology.

The scope of Research Methodology is wider than that of research methods.

The research problem consists of series of closely related activities. At

times, the first step determines the native of the last step to be undertaken.

Why a research has been defined, what data has been collected and what a

particular methods have been adopted and a host of similar other questions

are usually answered when we talk of research methodology concerning a

research problem or study. The project is a study where focus is on the

following points:

RESEARCH DESIGN

A research design is defined, as the specification of methods and

procedures for acquiring the Information needed. It is a plant or organizing

framework for doing the study and collecting the data. Designing a research

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plan requires decisions all the data sources, research approaches, Research

instruments, sampling plan and contact methods.

Research design is mainly of following types: -

1. Exploratory research.

2. Descriptive studies

3. Casual studies

EXPLORATORY RESEARCH

The major purposes of exploratory studies are the identification of

problems, the more precise Formulation of problems and the formulations of

new alternative courses of action. The design of exploratory studies is

characterized by a great amount of flexibility and ad-hoc veracity.

DESCRIPTIVE STUDIES

Descriptive research in contrast to exploratory research is marked by

the prior formulation of specific research Questions. The investigator already

knows a substantial amount about the research problem. Perhaps as a Result of

an exploratory study, before the project is initiated. Descriptive research is also

characterized by a Preplanned and structured design.

CASUAL OR EXPERIMENTAL DESIGN

A casual design investigates the cause and effect relationships

between two or more variables. The hypothesis is tested and the experiment

is done. There are following types of casual designs:

I. After only design

II. Before after design

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III. Before after with control group design

IV. Four groups, six studies design

V. After only with control group design.

VI. Consumer panel design

VII. Exposit facto design

B) DATA COLLECTION METHOD

PRIMARY SECONDARY

Direct personal Interview

Indirect personal Interview

Information from correspondents Govt.publication

Mailed questionnaire Report Committees & Commissions

Question filled by enumerators. Private Publication

Research Institute

PRIMARY DATA

These data are collected first time as original data. The data is recorded as

observed or encountered. Essentially they are raw materials. They may be

combined, totaled but they have not extensively been statistically processed.

For example, data obtained by the peoples.

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Published SourcesUnpublished

Sources

SECONDARY DATA

Sources of Secondary Data

Following are the main sources of secondary data:

1. Official Publications: Publications of the PEPSI & COKE and by

the corporate office of PEPSI & COKE.

2. Publications Relating to Trade: Publications of the trade

associations, stock exchange, trade union etc.

3. Journal/ Newspapers etc.: Some newspapers/ Journals collect and

publish their own data, e.g. Indian Journal of economics, economist,

Economic Times.

4. Data Collected by Industry Associations: For example, data

available with PEPSI & COKE..

5. Unpublished Data: Data may be obtained from several companies,

organizations, working in the same areas. For example, data on

PEPSI & COKE magazines.

Period of Study: This study has been carried out for a maximum period of 8

weeks.

Area of study: The study is exclusively done in the area of marketing. It is a

process requiring care, sophistication, experience, business judgment, and

imagination for which there can be no mechanical substitutes.

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Sampling Design: The convenience sampling is done because any

probability sampling procedure would require detailed information about the

universe, which is not easily available further, it being an exploratory

research.

Sample Procedure: In this study “judgmental sampling procedure is used.

Judgmental sampling is preferred because of some limitation and the

complexity of the random sampling. Area sampling is used in combination

with convenience sampling so as to collect the data from different regions of

the city and to increase reliability.

Sampling Size: The sampling size of the study is 100 users.

Method of the Sampling:

Probability Sampling

It is also known as random sampling. Here, every item of the universe has

an equal chance or probability of being chosen for sample.

Probability sampling may be taken inform of:

Simple Random Sampling

A simple random sample gives each member of the population an equal

chance of being chosen.  It is not a haphazard sample as some people think! 

One way of achieving a simple random sample is to number each element in

the sampling frame (e.g. give everyone on the Electoral register a number)

and then use random numbers to select the required sample.

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Random numbers can be obtained using your calculator, a spreadsheet,

printed tables of random numbers, or by the more traditional methods of

drawing slips of paper from a hat, tossing coins or rolling dice.

Systematic Random Sampling

This is random sampling with a system! From the sampling frame, a starting

point is chosen at random, and thereafter at regular intervals.

Stratified Random Sampling

With stratified random sampling, the population is first divided into a

number of parts or 'strata' according to some characteristic, chosen to be

related to the major variables being studied. For this survey, the variable of

interest is the citizen's attitude to the redevelopment scheme, and the

stratification factor will be the values of the respondents' homes. This factor

was chosen because it seems reasonable to suppose that it will be related to

people's attitudes

Cluster and area Sampling

Cluster sampling is a sampling technique used when "natural" groupings

are evident in a statistical population. It is often used in marketing research.

In this technique, the total population is divided into these groups (or

clusters) and a sample of the groups is selected. Then the required

information is collected from the elements within each selected group. This

may be done for every element in these groups or a subsample of elements

may be selected within each of these groups.

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Non Probability Sampling

It is also known as deliberate or purposive or judge mental sampling. In this

type of sampling, every item in the universe does not have an equal, chance

of being included in a sample.

It is of following type:

Convenience Sampling

A convenience sample chooses the individuals that are easiest to reach or

sampling that is done easy. Convenience sampling does not represent the

entire population so it is considered bias.

Quota Sampling

In quota sampling the selection of the sample is made by the interviewer,

who has been given quotas to fill from specified sub-groups of the

population.

Judgment Sampling

The sampling technique used here in probability > Random Sampling.

The total sample size is 100 profiles.

Data Collection : - Data is collected from various customers through

personal interaction. Specific questionnaire is prepared for colleting data.

Data is collected with mere interaction and formal discussion with different

respondents and we collect data in PEPSI & COKE and face to face

contact with the persons from whom the information is to be obtained

(known as informants). The interviewer asks them questions pertaining to

the survey and collects the desired information. Thus, the we collect data

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about the working conditions of the workers of COKE; I worked at COKE

contact the workers and obtain the information. The information obtained

are first hand or original in character.

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COKE COMES TO INDIA

Coca-Cola come to India with fanfare in the fifties. For a number of days,

The Hindustan Times and other newspapers of New Banaras carried full

page advertisement showing a big boy in uniform with a soft-drink crown as

the cap. There was no indication of the product. After a few days, Coke was

introduced. It was an entirely new drink which fascinated people. It soon

became the national drink. For the first time, a soft-drink was available from

one corner of the country to another. The person who brought Coca-Cola to

India was the father of late Sardar Charanjit Singh, Sardar Mohan Singh. A

practical man Mohan Singh realised that to popularise Coca-Cola, and make

it a best seller it was necessary to “catch them young.” So he focused on

youngsters in the society.

The company realised that to become a mass consumption product, one has

to go to the village. They gave much importance to the distributive network.

The company trucks supplied coke to even the remotest village.

Few products appears to be more similar than soft drinks, yet the Cola wars

that mark the competition between Coke and Pepsi show how even

organizations with highly similar product can be differentiated by their

business strategies. Then came battles over the issue of bottle size

standardization. Coke the arch rival tried to offering more Cola at a lower

price. Pepsi which had some of its early investment tied up in 250ml bottles,

went the fountain way. The General bottle size freed has settled at 300 ml. ,

100 ml more than the pre MNC standard. Fountain mix dispensers, carry

home bottles, even 1.50 plastic bottle with caps good enough to keep them

lying down and still preserve the fizz.

36

It poured in vast sums to whip up its visibility at the retail level, so that

consumers were greeted virtually at every street corner by Pepsi’s blue, red

and white colors, because they have perception “the thing on display sells

more.”. Coca-Cola is, finally, redoing the real thing to the replicate the

success that its arch-rival, PepsiCo., has achieved with its fast and furious

marketing. But to win them, Coke is copying Pepsi .

37

MARKETING STATEGIES OF COKE

a) PRODUCT

Coke was launched in India in Agra, October 24, in '93', soon after its

traditional all Indian launch of its Cola. at the sparking new bottling plants at

Hathra, near Agra. Coke was back with a bang after its exit in 1977.

Coke was planning to launch in next summer the orange drink, Fanta-

with the clear lemon drink, sprite, following later in the year.

Coke already owns more brands than it will over need, since it has

bought out Ramesh Chauhan. Coke just needs to juggle these brands around

dextrously to meet its objectives, to ensure that Pepsi does not gain market

share in t Today, Coke's product line includes, Coca-Cola, Thums Up,

Fanta, Gold Spot, Maaza, Citra, Sprite, Bisleri Club Soda and Diet Coke.

PACKAGING

Coca-Cola India Limited (CCIL) has bottled its Cola drink in different

sizes and different packaging i.e., 200 ml bottle, 300 ml. Bottle, 330 ml.

Cans, 500 ml. Bottle fountain Pepsi, and bottles of 1 and 2 ltr.

PRODUCT POSITIONING

One important thing must be noticed that Thums Up is a strong brand

in western and southern India, while Coca Cola is strong in Northern and

Eastern India. With volumes of Thums Up being low in the capital, there are

38

likely chances of Coca Cola slashing the prices of Thums Up to Rs. 5 and

continue to sell Coca Cola at the same rate. Analysts feel that this

strategy may help Coke since it has 2 Cola brands in comparison to Pepsi

which has just one.

Thums Up accounts for 40% of Coca Cola company's turn over,

followed by Coca Cola which has a 23% share and Limca which accounts

for 17% of the turn over of the company. (Thums up being the local drink,

its share in the market is intact, forcing the company to service the brand, as

it did last year Mr. Donald short CEO, Coca Cola India, said that, " we will

be absolutely comfortable if Thums Up is No. 1 brand for us in India in the

year 2000. We will sell whatever consumers wants us to". Coca Cola India

has positioned Thums up as a beverage associated with adventure because of

its strong taste and also making it compete with Pepsi as even Pepsi is

associated with adventure, youth.

b) PRICE

The price being fixed by industry, leaving very little role for the

players to play in the setting of the price, in turn making it difficult for

competitors to compete on the basis of price.

The fixed cost structure in Carbonated Soft Drinks Industry, and the

intense competition make it very difficult to change or alter the prices. The

various costs incurred by the individual company's are almost unavoidable.

These being the costs of concentrates, standard bottling operations,

distributor and bottlers commissions, distribution expenses and the

promotional and advertising expenditure (As far as Coke is concerned, it had

39

to incur a little more than Pepsi as Pepsi paved its way to India in 1989

while Coke made a come back in 1993.)

Currently a 300 ml. Coke bottle is available for Rs. 6 to8 The 330 can

was initially available for Rs. 13 and now, since the price has gave up to Rs.

18 per can. The prices of 500 ml., 1 ltr. and 2ltr being Rs. 15 Rs. 23 and Rs.

40 respectively( according to the current survey).

Dating back to ‘93', when Pepsi hiked the price of Pepsi - Cola from

Rs. 5 to Rs. 6 per 250 ml. bottle in some parts of the country-including Agra.

Coke penetrated the market with price of Rs. 5 for a 300 ml. bottle, making

it cheaper by Rs. 1 and 50 ml. than Pepsi. Coke's strategy at that time being

able to expand the availability of soft drinks even in rural India. Coke's

priority being to first increase the number of drinks per drinker, and then the

number of drinkers itself. Pepsi also tried this but was trapped by a series of

competitive price increase and changes in bottle sizes by Parle. But the

prices of soft drinks have shot up since Pepsi's arrival and the current prices

are being mentioned as under.

Price list

Name Bottle Size MRP (in Rs.)

Coke Per Bottle 200 ml 6

Coke 300 ml 8

Coke 500 ml (Plastic / Glass) 15

Coke 2 litre 35

40

Diet Coke (Can) 330 ml Can 18

Coke (Can) 330 ml Can 18

However, the trends may have been in the early '90's, now the prices

of Pepsi and Coke are the same making it difficult in future and present to

compete on the basis of price.

c) PLACE

Coke may have gained an early advantage over Pepsi since it took

over Parle in 1994. Hence, it had ready access to over 2,00,000 retailer

outlets and 60 bottlers. Coke was had a better distribution network, owing

to the wide network of Parle drinks all over India. Coke has further

expanded its distribution network.

Coke and its product were available in over 2,50,000 outlets (in

contrast with Pepsi's 2,00,000). Coke has a greater advantage in terms of

geographical coverage.

But Coke has had problems with its bottlers as the required profits for

the bottlers have not been forthcoming. This is more so because Coke has

hiked the price of its concentrate by Rs. 8 Further, Coke's operations in

India are 100% FOBOs. Now, it plans to convert then into COBOs. This is

straining the relationship between the Coke and its bottlers.

41

The company had decided to create a fund to reimburse performing bottlers

for the extra costs incurred on account of the hike in prices of soft drink

concentrates. Mr. Short also realized that India is a price sensitive market

and the company would have to absorb in the increase in excise duty and

said that in the long run Coke will have to slash prices for the benefit of the

consumers and said that they were considering a cut in the prices of their

fountain soft drinks.

Coke and Pepsi have devised strategies to get rid of middlemen

in the distribution network. However, 50% of the industry unfortunately

depends on these middlemen. As of now, around 100 agents are present in

Banaras . Bottlers of the 2 multinationals have strongly felt the need to

remove these middlemen from the distribution system, but very little success

has been achieved in doing so.

d)PROMOTION

It must be remembered that soft drinks purchases are an "impulse buy

low involvement products" which makes promotion and advertising an

important marketing tool. The 2 arch rivals have spent a lot on advertising

and on promotional activities.

To promote a brand and even to spend a lot on advertising, the

company must be aware of the perceived quality of the brand, its brand

power (if at all there is) since consumers make purchase decision based on

their perceptions of value i.e., of quality relative to price.

42

According to Paul Stobart, Advertising encourages customers to

recognize the quality the company offers. Price promotions often produce

short-term sales increases.

Coca Cola has entered new markets and also developing market economics

(like India) with much-needed jobs.

Coke attributes its success to bottlers, the Coca Cola system itself, i.e.,

its executive committees, employees, BOD, company presidents but above

all from the consumer.

Coke's red color catches attention easily and also the Diet Coke which

it introduced was taking the Cake, as Pepsi has not come out with this in

India.

Ever since Coke's entry in India in 1993, Coke made a come back

(after quitting in 1977), in October 24 in Agra, the city was flooded by

trucks, there wheelers, tricycle cards-all with huge red Coke-emblazoned

umbrellas. Retailers were displaying their Coke bottles in distinctive racks,

also with specially-designed iceboxes to keep Coke bottles cold. This was

one big jolt to Pepsi.

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STRATEGIES ADOPTED

BY COCK AND PEPSI

The Pepsi Process: Despite being a global brand, Pepsi has built its success on

meeting the Indian consumer’s needs, particularly in terms of making the

brand synchronize with localized events and traditions. Instead of harping on

its global lineage, ergo, it tries to plug into ethnic festivals, use the

vernacular indifferent part of the country, and blend into the local fabric.

Pepsi is using both national campaigns-such as the Drink Pepsi, Get Stuff

scheme, which offers large discounts on other products to Pepsi-buyers as

well as local .

The Coke Copy: Instead of creating a bond with the customers through small

but high-impact events, Coca-Cola chose to associate itself with national and

international mega events like the World Cup Cricket, 1996, and world cup

football 1998. But now coke is also entering into local actions. Coke is also

trying to make their brand synchronize with localized events traditions and

festivals. Coca-Cola new tag line in this advertisement is “Real shopping,

Real refresher”. In this way Coke is copy Pepsi.

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EMPOWERMENT

The Pepsi Process: Once of the strongest weapons in Pepsi’s armory is the

flexibility it has empowered its people with. Every manager and salesperson

has the authority to take whatever steps he, or she, feels will make

consumers aware of the brand and increase its consumption.

The Coke Copy: Flexibility is the weapon that Coca-Cola, fettered as it is by

the need for approvals from Atlanta for almost everything. In the past, this

has shown up in its stubborn insistence on junking the franchisee network it

had acquired from Parle; in its dependence on its own feedback mechanism

over that of its bottlers;’ and on its headquarters-led approach.

PRICE

The Pepsi process: Pepsi has consistently wielded its pricing strategy as in

invitation to sample, aiming to turn trial into addiction.

It launched the 500 ml bottle in 1994 at Rs. 8 versus Thums Up’s Rs. 9, in

April, 1996, its 1.5 litre bottle followed Coke into the marketplace at Rs. 30

– Rs 5 less than Coke’s .But it couldn’t continue the lower price positioning

for long.

The Coke Copy: Initially, coke carbon-copied the strategy by introducing its

330ml cans in January 1996, at an invitation price of Rs. 15 before raising it

to Rs. 18. By this time, it had realised that the Coca-Cola brand did not hold

enough attraction for customers to fork out a premium. The 200ml Coke,

launched so far in parts of eastern, western, and northern India, is priced at

Rs. 5, lowering the entry-barriers. To really drive the market, as Coke wants

to you must go down to Rs. 3’.

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PEPSI VS. COKE

$28 BILLION TURNOVER $16 BILLION

32% INT. SALES AS % 70%` OF TOTAL SALES

RS. 5OO CRORES TOTAL INVESTMENT RS. 250 C IN INDIA

RS. 300 CRORES PROPOSED RS. 2,400CINVESTMENTS

2400 NO. OF EMPLOYEES 140

13 NO. OF OWNED NILBOTTLING PLANTS

18 NO. OF FRANCHISES 53

4000 NO. OF FOUNTAIN 1500

N.A. TOTAL INVESTMENT Rs 125 CRBY BOTTLERS

6 NEW PLANTS PLANNED N.A.

46

PEPSI AND COKE MARKET SHARE IN INDIA

47

COLA : 60% CLEAR LEMON : 4% Pepsi : 26.5 7-UP : 2.5% Thums-up : 17.5% Citra : 0.5%Coke :10% ORANGE : 16% OTHERS : 8% Mirinda : 7.5% Other Brands : 16.5%Fanta : 6%Gold Spot : 1%Crush : 1%CLOUDY LEMON : 12%Limca : 9%Mirinda lemon + Duke’s : 1.5%Schweppes lemon : 0.5%

48

The Cola Wars

OVER A CENTURY OF COLA SLOGANS,

COMMERCIALS, BLUNDERS, AND COUPS

There's little doubt that the most spirited and intense competition in the

beverage world is between Coca-Cola and Pepsi. These two American

companies long ago took their battle worldwide, and although there are other

colas in the market, these giants occupy this high-stakes arena by

themselves. The impact of Coke and Pepsi on popular culture is

indisputable, and I have observed in my time managing this web site that

America has not become jaded about the cola wars. The memorabilia, the

jingles, the trivia - all still popular. So I am offering this page in an attempt

to assuage a wee bit of the Coke and Pepsi thirst that is thriving on our

planet.

IT ALL STARTED . . . .

Coca-Cola was invented and first marketed in 1886, followed by Pepsi in

1898. Coca-Cola was named after the coca leaves and kola nuts John

Pemberton used to make it, and Pepsi after the beneficial effects its creator,

Caleb Bradham, claimed it had on dyspepsia. For many years, Coca-Cola

had the cola market cornered. Pepsi was a distant, nonthreatening contender.

But as the market got more and more lucrative, professional advertising

49

became more and more important. These soda companies have been leading

the way in advertising ever since.

ADVERTISING HISTORY & COMMERCIALS

Pepsi has definitely leaned towards the appeal of celebrities, popular music,

and young people in television commercials, while Coke relies more heavily

on images of happiness and togetherness, tradition, and nationalism,

perpetually trying to cash in on its original lead. In a simplified sense, you

could sum up the strategies as Coke: Old, Pepsi: New. In fact, as we will see,

when Coca-Cola tried something new, it was disaster.

The first magazine ad for Coca-Cola appeared in Munsey's in 1902.

Advertisements began to appear on billboards, newspapers, and streetcars.

Soon there were serving trays with images of people enjoying Coca-Cola,

and glasses with the cola's name on them. At this time, Coca-Cola and Pepsi

were served in drugstore soda fountains.

In 1909, Pepsi used its first celebrity endorser, automobile race driver

Barney Oldfield, in newspaper ads. In 1921, Pepsi went bankrupt, but

continued to appear on the scene, although not nearly so successfully as

Coca-Cola. In 1931, Pepsi went bankrupt again, but the new owner, Roy

Megargel, would hit upon an idea that would finally give Coca-Cola some

competition. In 1934, he marketed Pepsi in a 12-ounce bottle for a nickle. At

the time, Coca-Cola was sold in a 6-ounce bottle for ten cents. Voila! Profits

for Pepsi.

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Pepsi racked up another first by airing the first radio jingle in 1939. It was so

popular that it was played in jukeboxes and became a hit recordCoca-Cola

hit the airwaves in 1941.

In 1946, inflation forced Pepsi to increase prices. And in 1950, Pepsi offered

a larger 26-ounce bottle to court the young American housewife.

In the 1960's, the cola ad wars moved to television. Coca-Cola employed a

host of celebrity singers to promote the product, including Connie Francis ,

Tom Jones, The New Beats, Nancy Sinatra, and The Supremes. As we

moved through the years, both colas incorporated some of their best slogans

("Pepsi Generation" and "the Real Thing") into subsequent commercials.

In the 1970s, market research showed that consumers preferred the taste of

Pepsi over Coke. The Pepsi Challenge is still being conducted today. But

Coke came up with what is arguably the best of all cola commercials, the

1971 I'd Like to Buy the World a Coke ad. This landmark was recalled in

Christmas versions in 1983 and 1984, and a 1990 Super Bowl ad, which

was enough to make some Baby Boomers weep with nostalgia.

In the 1980's, Pepsi lined up the celebrities, starting with Michael Jackson,

then Madonna, Michael J. Fox, Billy Crystal, Lionel Ritchie, Gloria Estefan,

Joe Montana, and others. Coke signed on Michael Jordan, New Kids on the

Block, Aretha Franklin, Elton John, and Paula Abdul.

In 1985, responding to the pressure of the Pepsi Challenge taste tests, which

Pepsi always won, Coca-Cola decided to change its formula. Bill Cosby was

the pitchman. This move set off a shock wave across America. Consumers

angrily demanded that the old formula be returned, and Coca-Cola

51

responded three months later with Classic Coke. Eventually, New Coke

quietly disappeared.

Pepsi, meanwhile, had its own flop, Crystal Pepsi, which was supposed to

catch the strange wave of the times when everything colorless was clean and

desirable (Zima, bottled water). And then there was Pepsi Lite with the

lemony flavor and one calorie, introduced in 1975. Remember that one?

Apparently they didn't expect us to because later they gave us Pepsi One,

using the same concept, but a completely different taste. And, extending the

idea even further, we are now getting Pepsi Twist, a new product with a

twist of lemon flavor.

In 1991, Ray Charles sang, "You got the right one baby, uh-huh!" Also in

the 1990s, Cindy Crawford and the Spice Girls pitched Pepsi. And then

Pepsi aired commercials featuring the aggravating little girl (Hallie

Eisenberg) with her troubling male voice.

In the new century, both colas continue to battle it out on the television

screen. And celebrities continue to be important promoters. Recently, Pepsi

has had commercials by Bob Dole and Faith Hill, among others.

.

52

SLOGANS

It's clear in looking at the slogans over the years that Coke and Pepsi have

very different targeting strategies. Coke is touting itself as the original, the

authentic, and appealing to a sense of tradition, positioning itself as an

integral part of daily American life. Pepsi, on the other hand, is promoting

itself as something new, young, and hip, which seems a little odd after over

100 years. But Coke was first, after all. Pepsi has always targeted the youth

market more aggressively than Coke.

COCA-COLA

1886 - Drink Coca-Cola

1904 - Coca-Cola Satisfies

1904 - Delicious and Refreshing

1905 - Coca-Cola Revives and Sustains

1905 - Good All the Way Down

1906 - The Drink of Quality

1906 - The Great National Temperance

1907 - Delicious Coca-Cola, Sustains, Refreshes, Invigorates

1907 - Cooling . . . Refreshing . . . Delicious

1908 - Sparkling - Harmless as Water, and Crisp as Frost

1909 - Delicious, Wholesome, Refreshing

1910 - It Satisfies

1910 - Quenches Thirst as Nothing Else Can

1911 - It's Time to Drink Coca-Cola

1911 - Real Satisfaction in Every Glass

1912 - Demand the Genuine - Refuse Substitutes

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1913 - The Best Beverage Under the Sun

1913 - A Welcome Addition to Any Party - Anytime - Anywhere

1914 - Exhilarating, Refreshing

1914 - Demand the Genuine by Full Name

1914 - Pure and Wholesome

1916 - Just One Glass Will Tell You

1917 - Three Million A Day

1919 - Quality Tells the Difference

1920 - Drink Coca-Cola with Soda

1922 - Thirst Knows No Season

1922 - Thirst Can't Be Denied

1922 - Thirst Reminds You - Drink Coca-Cola

1923 - Refresh Yourself

1924 - Pause and Refresh Yourself

1925 - Six Million A Day

1925 - The Sociable Drink

1926 - Stop at the Red Sign

1927 - Around the Corner from Anywhere

1928 - A Pure Drink of Natural Flavors

1929 - The Pause that Refreshes

1930 - Meet Me At the Soda Fountain

1932 - Ice-Cold Sunshine

1933 - Don't Wear a Tired, Thirsty Face

1934 - Carry a Smile Back to Work

1935 - All Trails Lead to Ice-Cold Coca-Cola

1936 - What Refreshment Ought to Be

1936 - The Refreshing Thing to Do

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1937 - America's Favorite Moment

1937 - So Easy to Serve and So Inexpensive

1938 - The Best Friend Thirst Ever Had

1938 - Pure Sunlight

1938 - Anytime is the Right Time to Pause and Refresh

1939 - Coca-Cola Goes Along

1939 - Make Lunch Time Refreshment Time

1939 - Makes Travel More Pleasant

1939 - The Drink Everybody Knows

1939 - Thirst Stops Here

1940 - Bring in Your Thirst and Go Away Without It

1941 - Completely Refreshing

1942 - Refreshment That Can't Be Duplicated

1942 - Whoever You Are, Whatever You Do, Wherever You May Be,

When You Think of Refreshment, Think of Ice-Cold Coca-Cola.

1943 - The Only Thing Like Coca-Cola is Coca-Cola Itself. It's the Real

Thing

1943 - A Taste All Its Own

1943 - That Extra Something

1944 - How About a Coke

1945 - Passport to Refreshment

1945 - Whenever You Hear "Have a Coke," You Hear the Voice of

America

1947 - Coke Knows No Season

1947 - Serving Coca-Cola Serves Hospitality

1948 - Where There's Coke, There's Hospitality

1949 - Coca-Cola . . . Along the Highway to Anywhere

55

1950 - Help Yourself to Refreshment

1951 - Good Food and Coca-Cola Just Naturally Go Together

1952 - What You Want Is a Coke

1953 - Dependable as Sunrise

1954 - For People on the Go

1955 - America's Preferred Taste

1956 - Coca-Cola - Making Good Things Taste Better

1956 - Feel the Difference

1957 - Sign of a Good Taste

1958 - The Cold, Crisp Taste of Coke

1959 - Be Really Refreshed

1960 - Relax With Coke

1961 - Coke and Food - Refreshing New Feeling

1962 - Coca-Cola Refreshes You Best

1963 - Things Go Better With Coke

1965 - Something More Than a Soft Drink

1966 - Coke . . . After Coke . . . After Coke

1970 - It's the Real Thing

1971 - I'd Like to Buy the World a Coke 1974 - Look Up, America

1976 - Coke Adds Life

1979 - Have a Coke and a Smile

1982 - Coke Is It!

1984 - Just For the Taste of It (Diet Coke)

1985 - Just For the Free of It (Caffeine Free Coke)

1985 - We've Got a Taste For You (New Coke)

1985 - America's Real Choice (Coca-Cola Classic)

1986 - Catch the Wave (New Coke)

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1986 - Red, White and You (Coca-Cola Classic)

1987 - You Can't Beat the Real Thing

1989 - Can't Beat the Feeling

1990 - Can't Beat the Real Thing

1993 - Always Coca-Cola

1993 - Taste it All

PEPSI-COLA

1903 - Exhilarating, Invigorating, Aids Digestion

1907 - Original Pure Food Drink

1909 - Delicious and Healthful

1915 - For All Thirsts - Pepsi-Cola

1919 - Pepsi-Cola - It Makes You Scintillate

1920 - Drink Pepsi Cola. It will satisfy you.

1928 - Peps You Up!

1932 - Sparkling, Delicious

1934 - Refreshing and Healthful

1939 - Twice As Much For A Nickel Too

1943 - Bigger Drink, Better Taste

1949 - Why take less when Pepsi's best?

1950 - More Bounce to the Ounce

1950 - The Light Refreshment

1954 - Refreshing Without Filling

1958 - Be Sociable, have a Pepsi

1961 - Now It's Pepsi, For Those Who Think Young

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1963 - Come Alive! You're In the Pepsi Generation

1967 - Taste That Beats the Others Cold

1967 - Pepsi Pours It On

1969 - You've Got a Lot to Live and Pepsi's Got a Lot to Give 1973 -

Join the Pepsi People Feelin' Free

1975 - Have a Pepsi Day

1978 - Catch That Pepsi Spirit

1981 - Pepsi's Got Your Taste For Life!

1983 - Pepsi Now!

1984 - Pepsi, the Choice of a New Generation

1992 - Gotta Have It

1993 - Be Young, Have Fun, Drink Pepsi

1995 - Nothing else is a Pepsi

1999 - The Joy of Cola

58

59

COKA COLA, PEPSI IN CALORIE BATTLE

Arch rivals plan salvos of new diet colas, Pepsi ONE and Coca-Cola

Zero.

March 22, 2005:

NEW YORK (CNN/Money) - The beverage aisle is about to get more

crowded as Pepsi and Coca-Cola debut new diet colas.

Coca-Cola is adding a fourth diet cola to its line this June with Coca-Cola

Zero, with no calories, the company announced Tuesday. And this spring

Pepsi is relaunching its one-calorie Pepsi ONE with Splenda sweetener

rather than aspartame.

Reformulated Pepsi One, available on shelves and coolers in late March,

is part of Pepsi's focus on diet soft drinks this year, said Katie Lacey, Pepsi-

Cola North America's vice president of carbonated beverages, in a statement

While for Coke, "Coca-Cola Zero is exactly what young adults told us they

wanted," said Dan Dillon, vice president, Diet Portfolio, Coca-Cola North

America, in a statement.

Apparently America's youth wanted a cola sweetened with sugar

subsaspartame and acesulfame potassium. The new cola will not replace Diet

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Coke, favored by a different group of cola swiggers, according to the

company.

Both Pepsi's (up $0.08 to $52.64, Research) and Coke's (up $0.06 to $41.66,

Research) new diet brews are aimed young adults, mostly male, according to

Adage.com. Apparently, more men are gulping reduced-calorie and zero-

calorie beverages to stay trim, the article says.

Along with Diet Coke and the new Zero, Coke's diet selection includes a

Splenda-sweetened Diet Coke, Diet Coke with lime and C2, launched last

year.

For the curious, Coca-Cola Zero will auction off a sample pack of the cola on

eBay in April.

Coke vs. Pepsi: the new cola wars

NEW YORK (CNN/Money) - The Beatles or the Backstreet Boys? Star Trek or Star

Wars? Yankees or Mets? They say you must like either one or the other.

Shares of Coca-Cola (KO: Research, Estimates) and PepsiCo (PEP:

Research, Estimates) have been on a tear this year, with each posting solid

gains in an otherwise dismal market. Coke has surged 20.3 percent year to

date while Pepsi is up 7.2 percent. The two currently are trading just a hair

off their 52-week highs.

61

But some analysts and fund managers think the trendier Pepsi has more fizz

left in its stock than Coke.

Coca-Cola is launching a new product, Vanilla Coke, next week (May 15)

while Pepsi recently announced that it will start selling a berry flavored cola,

Pepsi Blue, in August. With Vanilla Coke, the company seems to be

banking on nostalgia. (John Travolta's character in "Pulp Fiction" ordered a

Vanilla Coke at a 50's themed diner, for example.)

Pepsi Blue, on the other hand, seems to be a concerted attempt to reach out

to the hipper, younger demographic that drinks Pepsi's Mountain Dew. And

embracing that demographic has worked. The launch of Code Red, a cherry-

flavored version of Mountain Dew, last year helped Pepsi increase its market

share. According to the Beverage Market Corporation, unit volume for all of

Pepsi's soda brands (including Diet Pepsi and Mountain Dew for example)

increased 1.3 percent in 2001 while volume for Coke's carbonated beverage

brands (Diet Coke, Cherry Coke and Sprite among others) declined by .2

percent.

"This is a mistake for Coke. Pepsi is going after the right market. Younger

audiences are going to buy more of Pepsi Blue. I don't see any edge in

vanilla," says Ted Parrish, co-manager of the Henssler Equity Fund. As of

April 30, Pepsi was the fund's second-largest holding. The fund does not

own Coke.

62

BATTLE OF THE BEVERAGES:

63

PEPSI IS NOT AS PRICEY

Regardless of which soda you like better though, Pepsi seems the better

value than Coke right now. Coke is trading at a nearly 20 percent premium

to Pepsi based on 2002 P/Es even though the two companies' earnings

growth rates are nearly identical. (Pepsi's are actually a shade higher.)

And when you look at revenues, the gap is even more dramatic. Coke is

trading at 7 times estimated 2002 sales while Pepsi is trading at 3.5 times

2002 revenue estimates. Both companies are expected to post slight declines

in sales this year and an increase of about 4 percent in 2003. Due to this

disparity in valuation, Jeff Kanter, an analyst with Prudential Securities, says

he has a "buy' rating on Pepsi and "hold" on Coke. Prudential does not do

investment banking.

To be sure, Coke is still the market share leader in soft drinks. One of the

main reasons the stock has outperformed Pepsi this year was because it

reported a better than expected gain in unit volume in the first quarter. And

the company has taken steps to cement its carbonated beverage lead as well

gain ground in the bottled water market. (Coke and Pepsi both have their

own brands of water, Dasani and Aquafina, respectively.)

On Tuesday, Coke announced that it was acquiring the Seagram's line of

mixers, tonic, ginger ale and seltzer from Diageo and Pernod Ricard. And

last month, Coke entered into an agreement with Group Danone to distribute

Evian bottled water in North America.

64

Some pretzels with that soda?

But while Coke relies solely on beverages for growth, another factor in

Pepsi's favor is its diversity. "What attracts me to Pepsi is I have more faith

in their ability to grow earnings. Not only are they successful on the

beverage side but they are successful with salty snack foods," says Crit

Thomas, director of growth equity for National City Investment

Management Co., the subadvisor for Armada Funds. As of March 31, Pepsi

was the seventh-largest holding in the Armada Tax Managed Equity Fund

and the tenth-largest holding in the Armada Equity Growth Fund.

In fact, Pepsi's carbonated beverages are not even the biggest generator of

sales and earnings for the company. Pepsi's Frito-Lay brand of snack foods,

which include Fritos, Doritos and Rold Gold, accounted for 61.2 percent of

revenue and 65.3 percent of operating profits in the first quarter.

Pepsi's soft drink business made up 19 percent of sales and 23.2 percent of

operating profit. Pepsi also owns Gatorade and Quaker Foods, having

acquired Quaker Oats last year.

One potential risk for both Pepsi and Coke is the economy. No, not if it goes

back into a recession. If the economy continues to improve, the stocks could

fall victim to what is known as sector rotation, the selling of defensive

companies like food and beverages in order to buy more economically

sensitive companies in the financial services and technology sectors. To that

65

end, shares of Pepsi and Coke fell slightly on Wednesday during the Cisco-

induced market rally.

Still, Thomas says signs that the dollar is starting to weaken compared to

other currencies should prop up both stocks. That's because a weaker dollar

helps boost the profits of international subsidiaries, since profits made in a

foreign currency are converted back to dollars. The majority of Coke's sales

are from its international operations, with just 38 percent of revenue coming

from the U.S. last year. Pepsi is not as big globally but currency fluctuations

are still a factor, as international sales accounted for 29 percent of revenue in

2001.

More than just two soda stocks

But if you're not a fan of either Pepsi or Coke, there actually are several

other beverage stocks out there. And they're trading at lower valuations.

Cadbury Schweppes (CSG: Research, Estimates), the British

confectioner, owns the Dr Pepper, 7 Up, A&W and Royal Crown brands of

soda. It too is joining the new round of cola wars, introducing Red Fusion, a

fruit flavored version of Dr Pepper, Friday. Red Fusion will hit the market in

July. Cadbury Schweppes' stock trades at a sizable discount to Coke and

Pepsi, with a P/E of 16.7 based on 2002 earnings estimates. Earnings are

expected to increase 12.5 percent this year.

Cott (COTT: Research, Estimates), the largest maker of private label

sodas, trades at 26 times 2002 earnings estimates but it's growth prospects

for this year and next are better than Coke and Pepsi. Analysts expect Cott's

earnings to increase 34.5 percent this year and 23 percent in 2003.

66

Finally, for you Shasta fans out there (we know there are some), there is

National Beverage (FIZ: Research, Estimates), which owns Shasta and

Faygo, a brand of carbonated beverages popular in the Midwest. The stock is

thinly traded and has no analyst coverage, but for what it's worth it is trading

at less than one times last year's sales.  

67

PRODUCT

The term soft drink was originated to distinguish the flavored refreshment from

hard liquor. Soft drink was flavored to change the habits of earlier Americans

who used to have hard liquor. The fruits and vegetable juices are not considered

soft drinks. Pepsi is a pure soft drink, which is enjoyed in our 195 countries. It

is made of artificial flavors and contains no fruit juice or fruit pulp.

How soft drinks are made:

Soft drink consists of carbonated water and syrup. Adding carbonated gas to

water under pressure produces carbonated water. The gas makes the water

bubble and fizz in most cases. Syrup is made of a concentrate and sweetener. A

concentrate is a blend of flavor and acid. In concentrate for most soft drinks

also include coloring. The concentrate contains a unique blend of ingredients,

which give Pepsi its distinctive flavor. Syrup can be also being prepared

directly from individual ingredients. Carbon dioxide gas gives beverage its

sparkle and tangy taste and prevents spoilage. While it has not been

conclusively proved that carbonation offers a direct medical benefit, carbonated

beverage are also used to alleviate post operative nausea when no other food

can be tolerated. Carbon dioxide is supplied to soft drinks by manufactures in a

liquid form maintained under approximately 1,200 pounds per square inch

pressure in heavy steel containers.

Many of the flavorings found in soft drinks come from natural sources such as

fruits juices and oils obtained from roots, citrus fruit peels, and leaves of

various plants. Some flavoring are artificial, but a similar to natural flavoring in

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taste. Citric acid and phosphoric acid give soft drink a tart taste. Caramel is

usually used as a coloring in cola drinks. The sweeteners may come from

maize, sugar beet or sugarcane. Artificial sweetener, such as saccharine and

aspartame is used in Diet Pepsi and Diet Coke.

The mixing is carried out under the highest standards of quality control and

accordingly to precise instructions in order to insure that every consumer

always receives a product of the same trusted quality. The bottling of Pepsi in

modern plants such as there are in India is carried out at the rate of 600 bottles a

minutes. Pepsi is approved by the National Health Authorities of every country

in which it is sold.

Packaging

Pepsi is supplied in -

Returnable glass bottles (200 ml, 250 ml, 300 ml, 500 ml, 1 lt.)

which is supplied in molded plastic shells.

1.5 litre PET bottles,

330 ml of cans,

PMX machines (Fountain Pepsi)

Fountain Pepsi (F P) Dispenses soft Drinks in plastic cups. There are two

methods of vending soft drinks.

1. Pre-mix system - In the premix system, the finished beverage is

prepared by the soft drink manufacturers and filled into 5 to 10 gallon

69

stainless steel tanks. The tanks of the beverage are attached to the vending

machine where the beverage is cooled and dispensed.

2. Post-mix system - In post-mix system the vending machine has its

own water and carbon dioxide supply. The water is supplied through Aqua

Guard purifier and is carbonated as required by carbon dioxide cylinder. It is

then mixed with concentrate or flavored syrup which is kept in BIB (Bag in

Box) as it is dispensed into the cup. Pepsi has post mix vending machines

and coke has pre mix vending machines.

Cans & Bottles - Among the different packages in the market in the next

couple of years could be cans and pet bottles - apart from the standard glass

bottles. One of the standard packages that one is likely to see in the coming

years is buying more at lower price. Pepsi introduced 200 ml bottles of Pepsi

at the price of Rs.6. It was an instant hit while packages of those kinds are

also being worked out keeping in view of the rural market. But it could also

lead to the killing of the standard 300 ml size bottles that is in vogue now.

The consumer would get a choice of soft drink at a cheaper and an

affordable price - even if it means breaking of certain standards shapes and

sizes of the packages. The broad strategies of both penetrating the market are

still being made. And the amount of thought that is going into it can be made

out from the very fact that the manufacturers are thinking of such

innovations as the “picnic packages” of the brand for those on holiday trip.

The battle will be engrossing as packages will be brought to the market and

be pulled by the competing rivals. There would be price wars and

competitions on qualities.

70

In the US, 55% of the carbonated soft drink (CSD) is sold today in

returnable bottles, 30% on one-trip containers and 15% through vending

machines and fountain. In other parts of the would, Pepsi are sold mainly in

returnable bottles. Pepsi in cans are more popular in countries such as US,

Canada, Australia, Philippines and England. Canned Pepsi is also sold in

India.

71

Brands –

The current Indian market consists of seven-flavor segment. Cola segment is by far the

most widely consumed soft drinks.

SEGMENT BRAND

COLA PEPSI

ORANGE MIRANDA

CLOUDY LIME MIRANDA

LEMON

CLEAR LIME 7-UP

SODA EVERESS

MANGO SLICE

In addition to these segments, Pepsi has developed wide range of

soft drinks such as Diet Pepsi, Caffeine Free Pepsi and low sodium Pepsi,

Sugar Free -Pepsi Max.

72

CHARACTERISTICS OF THE PRODUCT

These are some of the unique characteristics of the products:

1. Package is returnable and vulnerable to breakage.

2. Weight of package is twice as much as that of the product.

3. Has a seasonal demand resulting in partial idling of the distribution

network.

4. Demands highlight intensive availability of the product with very low

dealer index essential on account of “impulse demand”.

5. Occupies more shelf space (or cooler space) per a rupee worth of

investment than most other brand product. This factor, coupled with

the return ability of the container, involves a very high level of service

frequency.

6. Ratio of distribution costs to selling price is higher than for any other

branded mass consumption product.

All these point to the fact that a penetrating distribution network

coupled with efficient feeding are the only means to higher sales.

73

PRICE

Maximum retail price of 300 ml bottles is controlled by the Central Government. The

other size and packs are priced keeping factors like competition, internal costs, external

costs, the corporate objective of the company in the mind.

PRODUCT SELLING PRICE MAX.RETAIL PRICE

(Per crate) (Per crate)

300 ml bottles 168 192

500 ml bottles 264 288

1 Liter bottles 466 480

Soda 300 ml 144 168

Cans 312 312

1.5 Liter PET 34* 36*

bottles

Price per bottles the empty bottles are priced at Rs 120 per crate and the

shell at Rs 100.

74

PREFERENCE OF SOFT DRINKS IN A DAY

Once a day 25%

Twice a day 20%

Once a week 5%

Other 50%

2 5 %2 0 %

5 %

5 0 %

0 %1 0 %2 0 %3 0 %

4 0 %5 0 %6 0 %

O n c e ad a y

T w ic e ad a y

O n c e aw e e k

O t h e r

O n c e a d a yT w i c e a d a yO n c e a w e e kO t h e r

Figure-1

75

PREFERENCE TO THE BRAND

Pepsi 60%

Coke 40%

6 0 %

4 0 %

0 %

2 0 %

4 0 %

6 0 %

8 0 %

P e p s i C o k e

P e p s i C o k e

Figure – 2

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TO GIVE THE PREFERENCES

More Popular 10%

Packaging 10%

Taste 70%

Price 10%

1 0 % 1 0 %

7 0 %

1 0 %

0 %

2 0 %

4 0 %

6 0 %

8 0 %

M o r eP o p u l a r

P a c k a g i n g T a s t e P r i c e

M o r e P o p u l a r P a c k a g i n g T a s t e P r i c e

Figure – 3

77

MARKETING STRAGGLES OF COMPANY EFFECTS THE

SALES

Yes 55%

No 45%

5 5 %4 5 %

0 %1 0 %2 0 %3 0 %4 0 %5 0 %6 0 %

Y e s N o

Y e s N o

Figure – 4

78

FORM OF MARKETING STRATEGIES

Television Advertising 45%

Newspaper Advertising 5%

Outdoor Advertising 20%

Sales Promotion 30%

4 5 %

5 %

2 0 %

3 0 %

0 %

1 0 %

2 0 %

3 0 %

4 0 %

5 0 %

T e le v is io n A d v . N e w s p a p e r A d v O u t d o o r A d v S a le s P r o m o t io n

T e le v is io n A d v . N e w s p a p e r A d v O u t d o o r A d v S a le s P r o m o t io n

Figure – 5

79

CHANGE BRAND ON THE BASIS OF PRICE REDUCTION

Yes 51%

No 49%

5 1 %

4 9 %

4 8 %

4 9 %

5 0 %

5 1 %

5 2 %

Y e s N o

Y e s N o

Figure – 6

80

MORE EFFECTIVE ADVERTISING

Pepsi Co. 60%

Coke Co. 40%

6 0 %

4 0 %

0 %

2 0 %

4 0 %

6 0 %

8 0 %

P e p s i C o . C o k e C o .

P e p s i C o . C o k e C o .

Figure – 7

81

CREATIVE AND APPEALING ADVERTISING OF THE

SOFT DRINK COMPANY

Pepsi Co. 70%

Coke Co. 30%

7 0 %

3 0 %

0 %

2 0 %

4 0 %

6 0 %

8 0 %

P e p s i C o . C o k e C o .

P e p s i C o . C o k e C o .

Figure – 8

82

INNOVATIVE AND EXCITING OFFERS

Pepsi Co. 55%

Coke Co. 45%

5 5 %4 5 %

0 %1 0 %2 0 %3 0 %4 0 %5 0 %6 0 %

P e p s i C o . C o k e C o .

P e p s i C o . C o k e C o .

Figure –9

83

MARKET SHARE PERCENTAGE IN BANARAS

Pepsi 56%

Coke 35%

Pure Drinks 9%

5 6 %3 5 %

9 %

P e p s i C o k e P u r e D r i n k s

Figure - 10

84

MARKET PERCENTAGE SHARE IN ALL OVER INDIA

2004

Pepsi 44%

Coke 51%

Local Brand 5%

5 %

5 1 %

4 4 %

P e p s iC o k eL o c a l B r a n d

Figure - 11

85

BRAND PREFERENCES

In a survey done by A & M magazines on the best marketing companies in

India. Pepsi and Coca-Cola were also entered. The results were as follows :

Pepsi - 4th

Coca-Cola - 11th

The results of 95 were :

Pepsi - 7th

Coca-Cola - 11th

This shows that both the companies are paying more attention to the

marketing of their products. Pepsi is higher up on the scale than Coca-Cola.

We can see that by the brilliant advertising done by Pepsi, which can be seen

on every hook and corner of Banaras . The consumers also prefer Pepsi

advertisements and other activities of Pepsi, to that of Coca-Cola.

86

FINDINGS & ANALYSIS

The Indian soft drinks market is at 140 million cases per year. This is very

low, even as compared to Pakistan and Bangladesh. All these factors

together have contributed to a 20% growth in the soft drinks industry.. If this

demand continues to grow at 20% grow at 20% annually, within 10 years the

volumes could reach 1 billion cases. This kind of growth is the reason for the

entry of the two giants of the soft drink industry of the world.

Coca-Cola

Pepsi

Coca-Cola and Pepsi together control 97% of the 4 entire Indian market. The

rest of the 3% is shared by companies like Cadbury-Schweppes and Campa-

Cola. The total no. of case sold are 140 million of these 77 million cases of

Cola drinks are sold and 63 million of non-cola drinks. There is a rapid

increase in the sale of cola soft drinks. Whereas in 1990, they accounted for

a third of all soft drinks sold, now their share is well over half. Also cola

sales are growing at a faster rate than non-colas. One of the reasons for this

could be the aggressive marketing strategies for Cola drinks by Pepsi and

Coca-Cola.

The race to quench the great Indian thirst had deign.

87

Market Share Percentage in Banaras -2007

Pepsi findings:

Pepsi is the largest selling soft drink in India today. In Banaras it has 55%

of the market share. In India it has 43% of the market share making it the

largest selling soft drink, but the second largest company in terms of sales.

The sales of Pepsi is approximately Rs. 1,000 crore annually in India of this

only about Rs. 30 crore annually is credited to the foods section of Pepsi.

The rest is all earned by the soft drinks.

The soft drinks in Pepsi Foods LTD include :

1. Pepsi Cola

2. Mirinda Orange

3. 7-Up

4. Mirinda Lemon

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The main advantage the Pepsi has over its nearest competitor i.e., Coca-Cola

is that of its was the first multinational to enter India, in the soft drinks

sector. Pepsi officials and ‘Dial-a-Pepsi’ scheme to grow the market, instead

of giving discounts at the retail level. Another point which attributed to

Pepsi’s success is the bottling operations. Pepsi does most of its bottling on

its own. Another significant investment of Pepsi has been fountains.

Fountains have considerably increased sales of Pepsi, as they have offered

consumers a whole new way to experience soft drink. According to a study

done, 80% of all soft drinks are consumed on premise, at the point of

purchase, rather than at home; thus the fountain initiative has paid off.

Thus we see that Pepsi has followed aggressive marketing strategies making

themselves get into the minds of the consumer by being visible inside and

outside the consumers home by way of television, radio Newspapers,

hoarding, sales-promotion schemes, etc. Pepsi has been voted the number

one customer service company across categories in terms of regularity,

availability responsiveness and initiative.

89

PUBLIC RELATIONS ANGLE

Innovative and exciting offers

The respondents were asked to compare between PepsiCo and Coca-Cola [I]

Ltd. in terms of who comes up with innovative and exciting offers, or rather

things which are lively and interesting to participate.

50% of the respondents, replied in favour of PCI while 30% responded in

favour of CCI. 17% of the respondents thought that both were equally good

and it varied with time, place and occasions. 3% of the respondents were not

aware of all the activities and were modest to admit it.

Quick and responsive to different occasions and events.

Comparing PepsiCo and Coca-Cola[I]Ltd, 55% of the respondents replied

that it was undoubtedly PepsiCo. They supported their statement with

reasoning, saying so that PepsiCo was first to associate with India’s 50 years

of independence.

On the other hand 22% of the respondents felt that Coca-Cola[I]Ltd. is not

trailing back. It sponsors mega events like different Cricket tournaments,

Olympic games, World Cup Football etc.19% of the respondents came up

with a more balanced answer. They said if one of the companies sponsors

one event its sure that the other will definitely go on for the next. Its a tough

tussle and is really difficult to demarcate today.

Future leader in the market

When the respondents were asked about their perceptions, as who would be

the future leader in the market, 42% of the respondents replied in favour of

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PepsiCo. According to them PepsiCo has entered Indian market prior to

Coca-Cola [I] Ltd. and has strong foothold now. Above that it is innovative

and there is freshness in its Ads. The only thing required is to maintain its

position.38% of the respondents claimed that after taking over Parle

Industries Coca-Cola [I] Ltd. is in a comfortable position. If it can promote

brands of Parle Industries like Thums Up and Limca which has a substantial

market in India, it may turn out to be the leader in future.

Again 15% of the respondents feel that both the companies are fighting tooth

and nail for supremacy. The one which commits an error in its strategy will

trail behind.

91

CONLUSIONS

Pepsi is the market leader in terms of soft drinks in India, but comes second

to Coca-Cola which consists of Coca-Cola and park brands.

However in Banaras it is the market leader. Pepsi’s main target is obviously

to be the market leader and leave its nearest competitor, Coca-Cola, far

behind. To achieve this Pepsi seems to be relying on mass advertising. They

spend about 50-60 crore rupees annually on marketing activities. The

consumer is bombarded with Pepsi advertisements, sign, logo’s etc.,

everywhere.

Pepsi’s core market is the young –adult and Pepsi is taking great measures to

change the perception of these young-adults., Pepsi wants that these

consumers should associate all colas as Pepsi, the brand Pepsi and cola

should be synonymous with each other. This they are trying to do by getting

the heros of these consumers to endorse their product e.g. Sachin Tendulkar

and also by advertising for and by youngsters.

Pepsi drinks are available in almost the whole of India, this shows the

importance paid to distribution. Brand loyalists are very few in the market.

Thus the drink should be easily available, so that consumers cannot shift

their preferences.

Consumers

For the purpose of the study, questionnaires were prepared for the

Consumers. Care was taken to interview all types of consumers, i.e., :

a. Different age groups

b. Males and females

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c. People from different localities, etc.

In all about 60 consumers were interviewed. The conclusions that one can

draw from these answers provided by the consumers showed that marketing

activities do form a major part of the decision.

One thing that was common amongst all the consumers who were once a day

or once a week. The number one factor the influences a customer while

buying a soft-drink was taste. This was true for all the consumers who were

interviewed. The rest of the conclusions as deducted from the questionnaires

are as follows :

The younger generation preferred soft drinks to the older generation.

a. Children upto 15 years of age liked to have soft drinks upto 2-3 times a

day.

b. Young adults liked to have soft drinks upto 1-2 times a day.

c. Adults liked to have soft drinks about once or twice a week.

Children preferred Coca-Cola Fanta, Mirinda orange. Young adults liked

Pepsi. The older generation preferred Coca-Cola, Limca & Mirinda Lemon.

The reason given for choice of facourite soft drink was taste and easy

availability. Only if the consumer liked the taste of drink, he would have it

again.95% of the consumers felt that marketing strategies of the company

did affect the sales of their soft-drink.

Marketing strategies made the consumer try a drink for the first time. The

second time round it was the consumers choice himself and not strategy

could affect that. Youngsters were more acceptable to change. They tried

93

different drinks, Cola and non-Cola. Adults Stick to one and they prefer

drinks that do not affect their health, like Limca.

Major number of people found television advertising to be the most

effective. Young and the old, all liked to watch the advertisements on

television.

Sponsoring events, outdoor advertising and sales promotion schemes were

second choice of the consumers. Under television advertising, Pepsi came in

as the number 1 favorite of the people the advertisement of Shah-Rukh Khan

and the dog was the favorite of the consumers. Their new advertisement of

Mirinda Lemon is also lifted by the people. The advertisement that came in

second was, the Coca-Cola advertisement of the people Cricket and the song

Must-Kalander going on at the back. These, advertisement remained most in

the minds of the people.Most of the consumers felt that Pepsi was the market

leader in the soft-drink industry, in Banaras as well as in India. Whereas

while Pepsi is the leader in Banaras , in India Coca-Cola is number one.

99% of the consumers interviewed felt that the marketing strategies of the

Coca-Cola and Pepsi have helped them in attaining the huge market share

that they possess.Women and children prefer cans as compared to men.

These are the major conclusion that can be drawn about a consumers’

behaviour. Companies must take the initiative of finding out the habits of the

consumers and then changing them, in their favour.

94

RECOMMENDATIONS

Soft drinks are an impulse product. When a person is thirsty, he would first

think of water or tea. Some even would prefer ‘Nimbu Pani’.

The Indian population is the largest in the world today, there can be no other

country in the world, which provides so much of an opportunity for the soft-

drink manufacturers. The Indian soft drink market is at 140 million cases per

year, this is very low. Thus the consumption of soft drink can go up.

Sinc118+e the entry of Coca-Cola into the country the industry is growing at

a rate of 20% annually. If this rate is maintained, then by the year 2005 the

market of soft drink would be 1 billion cases annually.

However Coca-Cola wants to accomplish this feat by themselves. To do this

the industry has to take certain steps. All the companies are fighting to get a

major share of this growing market. They should all try to increase the total

market along with their individual shares.

On the basis of all the field work and table work done, some suggestions can

be made, which may help the company in increasing the total market as well

as the sale of the companies. The various suggestions that can be made are

as follows:-

Soft drinks retail at prices between Rs. 6 and Rs. 10. These are expensive

when measured against purchasing power.

According to one study, it takes an Indian 50 minutes of work to be able to

buy a bottle in other countries, the norm is five minutes. Thus to increase the

total market of soft drinks, manufactures should try and decrease the prices,

so as to increase sales.

95

Availability is a major factor, which makes the consumer buy a soft drink.

Soft drinks should be made available more readily than present. There are

only 300, 000 retailers stocking soft drinks in India. Thus retailing outlets

should be increased. Also related to this point, is vending machines. In

developed machines, vending machines are kept in all consumer areas, like

super markets, schools, amusement parks, local markets, etc. These tempt a

person into buying the soft drink. So if vending machines are put in strategic

areas, it would definitely increase consumption of soft drinks.

Soft drink cans which are very convenient, as the consumer can take them

anywhere, unlike a bottle, are very expensive retailing from Rs. 15-Rs. 18.

To increase sale of cans, this price should be brought down.

Innovations increase sales of company. For e.g. fountain Pepsi increased

sales of Pepsi Cans increased sales of Coca-Cola. Thus the companies

should constantly come out with innovative ideas.Example-300 ml plastic

bottles, which the consumer can take with him, unlike the glass bottles,

which he has to return. Plastic bottles can even be used again by households

for various purposes.

The companies should conduct studies to get to know about consumer

habits. For e.g. Coke knows that Americans see 69 of its commercials every

years , put 5.2 ice cubes in a glass and prefer cans to pop out of vending

machines at a temperature of 35 degrees.

If the companies know all this and more about Indian consumer behaviour, it

could tell them how to sell their drinks, so as to increase sales.

It is seen In India, that people prefer having their drinks with or after food.

Companies could have commercials which show people enjoying their drink

96

with a good meal, so that consumers associate drinking soft drinks while

having food.

Companies should try to educate the consumer about the health related

subject. For e.g:-

a) Limca is recommended to patients by doctors.

b) Cola drinks are known to be very fattening ,

But in fact cola drinks contain no calories from fat they contain calories

from sugar which can be easily burned off. The soft drink cans and plastic

bottles should mention the calories and other related information on the

packing.

Companies should try to build high brand equity. This provides a number of

advantages to the company.

a) The company enjoys reduced marketing costs because of high level of

consumer brand awareness and loyalty.

b) The company will have more trade leverage in bargaining with

distributors and retailers since the customer expects them to carry the

brand.

c) The company can change a higher price than its competitors because the

brand has higher perceived quality.

d) The company can more easily launch brand extension.

e) Above all, the brand offers the company some defence against fierce

price competition.

The companies should go in for diversification

97

Once the brand is known, it is easier to sell more of its products. For e.g.

Coca-Cola clothes have sold about $100 million worth of clothes and

accessories. This would increase revenues of the company.

The companies should not have competitor myopia. It is more often the

latent company than the current competitor who busies the company. Pepsi

and Coca-Cola are so busy fighting with each other, that they have left the

non-cola sector open for Cadbury-Schweppes.

Advertising is a way building brand image. It does not promote quick

selling. Thus companies should used advertising only for long advertising

can be used for:

a) Brand image building

b) Reminder advertising :reminding people to buy these drinks.

c) Reinforcement advertising-Telling people that they have made the right

choice.

Television advertising seems to make a impact on the consumers (based on

questionnaire answers) so companies should concentrate more on television

advertisements.

Sales promotion tools create a stronger and quicker response. Thus sales

promotion tools such as coupons, contests, premiums and the like should be

used to dramatize product offers and to boost sales. Sales-promotion effects

are usually short run and induce the people to purchase soft drinks, now.

Coca-Cola and Pepsi have taken up sponsoring of events on a major scale.

All kinds or events, whether big (Wills Worked cup) or small (college

contests) have either Pepsi or Coke banners of sponsorship. The

98

effectiveness of this can be questioned. Whether these activities increase

sales or not is a big huge question mark.

PepsiCo and Coca Cola(I)Ltd. should reduce their massive spending on

sponsoring events and try and channel this money into more productive

activities , like innovative packaging etc.

It is recommended that company should introduce more and more customer

oriented schemes and contexts. For eg. Pepsi’s new campaign “Pepsi cool

mal” in which they are giving free gifts to their customers.

The company should maintain a small group of “missionary sales man”

whose functions should be to guide distributors and retailers, keep a

constant watch over the prevailing situation to provide the continuous

feedback to the company.

It is also recommended that companies should launch soft drink in small

pack 200 ml and 150 ml.

Thus we see that there various steps which can be taken by the companies to

increase their sales and to increase the total market share.

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BIBLIOGRAPHY

Marketing Management- By Philip Kotler

Business world

Out look

Times of India

Course pack of Rai university

www.Pepsico.indialtd

Research methodology- By C. R. Kothari

100

QUESTIONNAIRE

Q.1. WHICH BRAND WILL YOU PREFERENCE OF SOFT DRINKS IN A DAY?

Once a day

Twice a day

Once a week

Other

Q.2. WHICH BRAND ARE YOU PREFERENCE TO THE BRAND?

PepsiCoke

Q.3. WHICH PARTICUALAR RATE TO GIVE THE PREFERENCES?

More PopularPackagingTastePrice

Q.4. ARE THE MARKETING STRAGGLES OF COMPANY EFFECTS THE SALES?

YesNo

Q.5. WHICH FORM OF MARKETING STRATEGIES IS MOST EFFECTIVE IN THE MARKET?

Television AdvertisingNewspaper AdvertisingOutdoor AdvertisingSales Promotion

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Q.6. WILL YOU CHANGE THE BRAND ON THE BASIS OF PRICE REDUCTION?

YesNo

Q.7. WHICH BRAND MORE EFFECTIVE IN ADVERTISING?

Pepsi Co.Coke Co.

Q.8. WHICH BRAND HAS CREATIVE AND APPEALING ADVERTISING OF THE SOFT DRINK COMPANY?

Pepsi Co.Coke Co.

Q.9. WHICH BRAND HAVING THE INNOVATIVE AND EXCITING OFFERS?

Pepsi Co.Coke Co.

Q.10. WHAT HAVE THE MARKET SHARE PERCENTAGE IN BANARAS ?

PepsiCokePure Drinks

Q.11. WHICH BRAND HAVING THE MARKET PERCENTAGE SHARE IN ALL OVER INDIA?

PepsiCokeLocal Brand

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