A Project Study Report On
Training Undertaken at
Varun Beverages Pvt. Ltd. (PepsiCo.) Kathmandu, Nepal Titled “Pepsi Vs Coke Promotional Campaign in Kathmandu ”
Submitted in partial fulfillment for the Award of degree of Master of Business Administration
Submitted By: Rajesh Chamlagain MBA 2nd Semester 20011-2013
Submitted To:Ms. Astha Jain Head of the Department
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Preface
Marketing plays vital role in today’s business scenario in consumer product Company, when there is such a high competition in the market.
The emphasis in the project is providing the study and an insight into Indian FMCG Business Scenario. The Summer Project is designed to provide participation of MBA program as on the job experience. This has given a chance to try and apply the academic knowledge and gain insight into corporate culture. This helps in developing decision-making abilities and emphasizes on active participation by the student.
I gained valuable experience & knowledge during the survey. The Project consists of my findings after data analysis & then conclusions were drawn and finally recommendations were put forward.
Keeping all this view the report is being prepared for marketing department of Varun Beverages Private Limited, for the specially assigned topic-“Pepsi V/s Coke promotional Campaign in Kathmandu”.
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Acknowledgement
I express my sincere thanks to my project guide, Mr. Sushil Tuladhar, Marketing Development Manager, of marketing Department, for guiding me right from the inception till the successful completion of the project. I sincerely acknowledge him for extending their valuable guidance, support for literature, critical reviews of project and the report and above all the moral support he had provided to me with all stages of this project. I would also like to thank the supporting staff pf Marketing Department, for their help and cooperation throughout our project.
(Signature of Student) Rajesh Chamlagain MBA 3rd Semester
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DECLARATION
I Rajesh Chamlagain declare that this project report entitled market” Pepsi V/S Coke promotional Campaign in Kathmandu”. Project is an original piece of work done and submitted by me towards partial fulfillment of my Post graduate program in MBA, under the guidance of Mr. Sushil Tuladhar (marketing development manager) PepsiCo. ( Kathmandu).
Date…….
…………….. Signature
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Executive Summary
Project Title Name of the Organization Name of the Project Trainee Duration of the project Organizational Guide Institutional Guide Major Objective Pepsi V/S Coke promotional Campaign Varun Beverages Pvt. Ltd. Rajesh Chamlagain 45 Days Mr. Sushil Tuladhar Marketing Development Manager, VBPL Ms. Astha Jain HOD, MBA To find out which of the promotional Campaign launched by Pepsi and Coke was more successful.
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Table of Contents
Chapter
Chapter-1 Chapter-2 Chapter-3 Chapter-4 Chapter-5 Chapter-6 Chapter-7 Chapter-8 Chapter-9
Content Preface Acknowledgement Declaration Executive Summary Introduction Research Methodology Analysis and Interpretation SWOT Analysis Findings Recommendations Conclusion Appendix Bibliography
Page Number 2 3 4 5 7 34 39 60 62 64 65 66 72
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Chapter-1: Introduction
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OVERVIEW VIEW OF SOFTDRINK INDUSTRY
Soft drink industry scenario the world is almost the same with two major players i.e. Pepsi Co. and Coca-Cola having the major thank in the pie. The other Major player in the industry is Cadbury-Schweppes and some local players in individual countries. The major components of the industry consist of the concentrate manufactures, bottlers and the sales and distribution network of the companies the rule and responsibilities of each of the are different. The major activity taken up by the concentrate 2 India fountain sales form a very insignificant part of the sales revenue. During the initial stages both soft drinks. Majors used a network of independent bottlers to bottle and market their products. Independent bottling arose primarily because it was not possible to create an effective organization for operating a vertically integrated company with hundreds of geographically separated manufacturing unit and local delivery operation given the limited transportation and communication system of the time and the lack of sophisticated financial and management controls. Although Coca-Cola and Pepsi Cola are premier marketing companies the fundamental competitive advantage that allowed that to compete so effectively lies in their ability to operate through a very cumbersome distribution system. In India after the entry of Coke in 1977 the Indian Soft Drink market was controlled by Parle and Pure Drinks. By the end of 1970 Campa Cola was practically alone in cola market Parles introduced Thumbs Up in the beginning of 1980s. By the and of 80’s Parle with Limca, Gold Spot and Thumbs up emerged as clear winner with around 60% market share.
In the year 1985 Pepsi tried to enter into India when it teamed up with RPG group. This proposal was rejected on the grounds that the import of concentrate could not be agreed and the use of foreign brand name was not allowed. In year 1988 Pepsi again floated a project this
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time in collaboration with Punjab Agro Industrial Corporation (PIAC) and Voltas India Limited and succeeded. Finally in June 1990 Pepsi was launched in India under the brand name of ‘ Lehar Pepsi’. Taking full advantage of the liberalization policies of the government Pepsi set up a new company in India called PepsiCo India Holding Pvt. A wholly around subsidiary Coca Cola company which is a leader in Soft drink industry returned to India after a gap of 16 years in 1995. The most strategic step taken by Coca Cola was the purchase of Parle brands. With this coke instantly had the ownership of countries tap soft drinks brands as well as got access to Parles extensive 54 plant bottling as well as a pre set distribution network. The Texas soft-drink industry dates from 1839, when Dr. Thomas Mitchell, an English physician living in Houston, operated an apothecary with a soda fountain from March until his death on October 1. Carbonated water had bubbled from springs in Europe since Roman times. During the eighteenth century, scientists experimented with "fixed air" and produced "aerated waters." Some of them used bicarbonate of soda in their experiments, and the term "soda water" became ensconced in the English language. By 1810 New York City had "soda fountains," where proprietors dispensed artificial "mineral waters" for therapeutic purposes. Flavored soda water, which developed with the rise of the ice industry, was available in apothecary shops, but bottled soda water was an expensive product. Sailing ships took ice from northeastern states to New Orleans in 1820 and later to Houston, and in 1838 a Houston newspaper noted that ice sold for 50 cents per pound. In 1850 Texas had none of the sixtyfour bottling plants in the nation. The first notice of a soda-water manufacturer in Texas was issued in 1866, when the Houston City Directory listed J. J. C. Smith's establishment as a "mineral water manufactory." In the 1870 census, Galveston and Brownsville reported "manufacturers of mineral and soda water." Victoria and Austin had two ice-making machines. Texas had one of the four ice plants in the nation. In 1880 Texas had eleven bottling plants: four in San Antonio, two each in Galveston and Austin, and one each in Houston, Dallas, and Mexia. In 1890 Texas had forty-two soda-water plants, plus five unspecified bottlers and seven breweries. The 1890s saw major changes in the state's soft-drink industry. New plants appeared with the introduction of the Hutchinson bottle stopper, patented in 1879 and manufactured in Chicago.
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(In a Hutchinson stopper, a wire loop protruded from the bottle neck and was fastened to a rubber seal; when seated the seal blocked the escape of gas from the water in the drink.) Most plants served one or two counties, and occasionally they shipped by rail to neighboring communities. The bottler's largest investment was in bottles and cases. No deposit was charged and bottle stealing among bottlers was common, even when glass blowers embossed the name of the town on the bottles. In 1891 the Elliott Bottling Works of Paris called a convention to address the problem. Twenty-nine bottlers and suppliers, principally from East Texas, met in October in Dallas and formed the Texas State Bottlers Protective Association. They drafted a constitution and by-laws aimed at preventing "the unlawful use of registered bottles, boxes, siphons, etc." But policing was impossible. By the 1890s two beverages had changed the character of the soft-drink industry. In 1885 Charles Alderton, a Waco pharmacist, originated Dr Pepper Phos-Ferrates (see DR PEPPER COMPANY), and in 1886 John Pemberton concocted Coca-Cola in Atlanta, Georgia. In 1885 Wade B. Morrison, who owned the Old Corner Drug Store in Waco, arranged with Robert Sherman Lazenby, owner of a small bottling plant, to mix and ship Dr Pepper Phos-Ferrates syrup to area drugstores. In 1891 a feed-store operator in Dublin, Texas, began bottling soda waters, including Dr Pepper. Other plants in Central Texas followed suit. However, during the 1890s no Texas bottling plant advertised a franchised soft drink and no company listed such a product in its company or corporate name. In 1898, during the Spanish-American War, Lazenby had an exclusive War Department contract to bottle and ship his Circle A Ginger Ale to servicemen in foreign lands. He supplied both army and navy installations until World War I. In 1900 Texas had 139 soda-water bottling plants. Lemon, ginger, ale, vanilla, orange, sarsaparilla, and raspberry were the principal flavors. The state also had seventy-seven ice plants, more than any other. Only one bottling plant used power-a four-horsepower central motor which delivered power by belts to carbonators and bottle-washing machines. In 1899 two lawyers from Tennessee, B. F. Thomas and Joseph Whitehead, secured "bottling rights" from the Coca-Cola Company of Atlanta, Georgia. They issued contracts to produce and sell Coca-Cola within control areas. Although Texas and parts of New England were excluded, the system provided the capital and the entrepreneurship needed to develop the soft-drink industry nationally. Thomas and Whitehead offered contracts in specific geographic
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regions, Thomas taking the northern and eastern states and Pacific coast and Whitehead taking the South and Southwest. Thomas built a bottling plant in Chattanooga, Tennessee, and Whitehead built one in Atlanta. Whitehead sold a half interest to J. T. Lupton, a lawyer from a Virginia tobacco family. Lupton helped finance the Coca-Cola bottling plant in Atlanta, and in 1902 his relatives opened plants in Dallas and Houston. Within three years Coca-Cola was selling its syrup to twenty-nine Texas plants. Soft drinks were among the first consumer products controlled by the franchise system. In 1914 twenty Texas bottlers listed Coca-Cola as part of their trade name, and eight did not. Other Texas companies did not issue franchises until the 1920s. Delaware Punch, a noncarbonated drink formulated in 1913 in San Antonio, was among the first to join Coca-Cola in issuing franchises in Texas. Between 1899 and 1914 the number of Texas plants doubled and the value of production tripled. In 1914 Texas had 262 plants (4.8 percent of the nation's total), but only the Coca-Cola bottlers included the franchise in their trade name. Between 1914 and 1924 a number of flavor manufacturers or distributors began offering franchises patterned after the Coca-Cola model. In 1922 Texas had 179 bottling works, but only 33 included a copyrighted soft drink in their trade name-30 with Coca-Cola and 3 with Whistle. By 1923 Texas had 205 plants (of 4,514 nationally). In 1924 nine bottlers were producing "cola" drinks besides Coca-Cola, including Chero-Cola, Tex-A-Cola, Lime Cola, Keen Kola, and Cola Hiball. Cola-Cola filed a lawsuit against all "imitators," won a raft of court decisions, and stopped the traffic for a decade. The Chero-Cola Company of Columbus, Georgia, changed its corporate name to Nehi Company and promoted fruit flavors. Other franchises in Texas included Whistle (six plants), Orange Crush (three), NuGrape (one), Grapico (two), and Cherry Blossoms (one). Bottling plants also manufactured other merchandise: ice (five plants), ice cream (ten), candy (eleven), creamery products (three), and beer (one). Out of 276 bottling firms, 114 produced no franchised soft drinks. In 1924 Texas bottlers marketed eleven trademarked products. By 1929 the state had thirty-four Nehi plants, ten Dr Pepper plants with name identification by trademark, three Orange Squeeze plants, and six other plants incorporating a beverage name. Coca-Cola gave bottlers "exclusive rights" to use its trademark in 6½-ounce returnable bottles in a specific territory. In
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1929 Texas had 325 bottling plants, 16.3 percent of the national total. The number declined to 260 in 1931 and 210 in 1933. During the Great Depression, Seven-Up and Pepsi-Cola sought markets in Texas, mainly under the promotion of Jodie W. McCarley of San Antonio. While shagging baseballs for the Cleveland Indians in St. Louis, McCarley met Pearl Whitcraft and Ed Taylor, who owned soda-water plants in the city. In 1929 Taylor offered McCarley a chance to get in the bottling business by assuming a debt owed a St. Louis flavor manufacturer. McCarley set up a small bottling plant in his home in San Antonio with second-hand machinery, and peddled his drinks each morning. In addition to generic flavors, he sold Knight Club Ginger Ale, mostly to bootleggers. Ed Taylor also put McCarley in touch with C. L. Griggs, owner of the Howdy Company, which offered franchises on Howdy Orange. In 1928 Griggs had copyrighted Seven-Up, a lithiated lemon drink promoted as a mixer. In January 1930 McCarley, the second bottler in the nation to receive a Seven-Up franchise (Taylor was the first), was given an opportunity to sell Seven-Up in seventy-eight Texas counties. Business was slow: he signed up only one bottler, Ed Knebel, who had moved his small plant from Pflugerville to Austin in 1930. In 1932 McCarley obtained a franchise to sell Hires Root Beer. Then Whitcraft notified McCarley that Pepsi-Cola was interested in Texas, and on April 1, 1934, McCarley and a partner secured a Pepsi-Cola franchise for sixty-four counties. McCarley was the first Texan to bottle Pepsi-Cola. In his first year he sold 13,300 cases of Pepsi in twelve-ounce beer bottles of brown, green, and "flint" (colorless). As his business expanded, he began operating five route trucks, and in 1937 he moved to a larger plant in San Antonio. By the 1930s, Pepsi and Nehi's Royal Crown Cola had established markets in Texas. Nehi had a statewide system known as Chero-Cola bottlers. Depression prices enabled bottlers to offer twelve-ounce drinks for five cents retail, and twelve-ounce bottles became popular. Between 1934 and 1939 Pepsi signed up bottlers in eighteen Texas towns, though many of these did not survive. Texas bottlers were highly competitive. With Cola-Cola leading the way, they maintained an eighty-cent wholesale price for a case of twenty-four bottles. The Coca-Cola franchise system had developed, however, when each plant served an area that a horse-drawn truck could
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cover in a day. The motor truck expanded dealer territories. Although each community had a wealthy Coca-Cola bottler, Walter Mack, Pepsi president in 1938-39, saw opportunities. CocaCola maintained 1,150 franchise areas in the nation, but Mack was able to franchise 550 areas for Pepsi. Pepsi also ran ads at independent radio stations and later on the networks. By early 1938 many Texas Coca-Cola bottlers, under company pressure, had dropped all flavors except Coca-Cola. Dr Pepper started franchising in 1925 and offered the drink to Coca-Cola bottlers, who declined to accept. In 1938 the Texas soft-drink industry comprised 297 plants. Most held multiple franchises. At the outbreak of World War II, the soft-drink industry faced rationing of sugar, crown caps, cork, gasoline, tires, trucks, and coolers. Though prices were frozen and labor became scarce, bottlers profited from the military bases established in Texas, since quota-exempt sugar was available to the military, which deemed soft drinks essential to morale. Coca-Cola promptly moved its vending machines, introduced in the late 1930s in service stations, grocery stores, and at-work outlets, to military bases. Few bottlers had vending machines, especially multiple choice vending. These bottlers found markets at the Post Exchanges. After the war, soft drink demand soared. On October 23, 1946, wartime controls were lifted, but sugar rationing continued until July 28, 1947. Bottlers were reluctant to break the "nickel price." Coca-Cola advanced its price from 80 cents to 90 cents to $1 a case, but still did not raise the retail price of 5 cents. Some coin-vending machines had a six-cent mechanism, but they were awkward to use. While Coca-Cola kept sales prices down, other companies, especially Pepsi and RC Cola, were stuck with a twelve-ounce bottle and its higher ingredient costs. In1955 Coca-Cola introduced the "king-size" (ten or twelve ounce) and the "family-size" bottles (twenty-six ounces). The family-size returnable became popular in Texas, particularly in urban areas. Dr Pepper and Seven-Up followed. Nehi had authorized the "Par-T-Pak" in quart or family size in the 1930s, but sales had been slow. Bottlers soon saw the economy of returnable bottles. As prices and bottle sizes increased, a conflict loomed between "big-bottle bottlers" and "little-bottle bottlers." Clifton C. Carter, a vice president of the Texas State Bottlers Association, sought to resolve the problem. In 1952 the Texas State Bottlers Association enrolled 226 bottling plants as dues-paying members; 145 plants were
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non-members. Carter, membership chairman, sought new members and saw a major increase in membership to 71 percent of total Texas bottlers. In February 1954 Carter became president, W. L. "Brownie" Dorris became vice president, and J. Conrad Dunagan became second vice president. Association officers made swings through Texas to enlist members. Carter visited eleven cities, Dorris nine, and Dunagan five. Their efforts bore fruit. By enlisting members, the association began to defuse the bottling controversy and other problems. In 1957 the American Bottlers of Carbonated Beverages, of which the Texas State Bottlers had been an affiliate since 1919, cited the Texas group as the "outstanding state bottlers' association in the nation." Dunagan was elected to the ABCB Executive Board in 1961 to the presidency for 1957-58. Texas, with more ABCB members than any other state, brought the national convention to Dallas in 1961. Vice President Lyndon B. Johnson gave the keynote address. As the Texas bottlers worked out their differences, innovations changed the industry in packaging, manufacturing, and distribution. Cans with linings that could withstand the acidity of soft drinks were introduced, along with materials to withstand high degrees of carbonation. Calcium Cyclamate and sodium cyclamate were combined with the synthetic sweetener saccharin to produce an acceptable diet drink. Nehi had tried to market Diet Rite in 1952 in Texas, but acceptance was spotty. However, diet drinks gained steadily and reached an annual rate of 15 percent of the soft-drink market by 1969. Major soft-drink companies, as well as major brewers, had developed canned drinks during World War II, but a "metallic" taste persisted because the cans lacked special acid-resistant linings. Coco-Cola introduced canned drinks in 1960, when it authorized the Kimble Food Products Company of Fort Worth to offer canned Coca-Cola to franchised bottlers. Although supermarkets quickly accepted canned drinks, they sold only 450 million cans in 1954, a fraction of the 30.3 billion bottles sold. Canned-drink sales fell to 317 million by 1956, when Royal Crown, Nehi, and Par-T-Pak entered the market. Canned RC Cola, Diet Rite, and Nehi flavors arrived in Texas by rail from Columbus, Georgia. The glass-container industry, aware that Texas supermarkets objected to handling returnable bottles, introduced light-weight glass bottles. The larger sizes, twenty-six to thirty-two ounces, easily competed with aluminum and steel cans. Marketing strategies also changed. In the 1920s, soft drinks were sold for home consumption. Grocery stores offered a
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twenty-four-bottle wooden case, and plants also sold cases from the floor or loading docks. In 1922 Coca-Cola sought additional markets by producing a cardboard six-bottle carton, but the boxes were too expensive for one-trip use. Strengthened paperboard solved the problem. In 1933 Coca-Cola distributed 2 cent postcards to bottlers for stores to use as coupons with which a customer could received a free six-pack by paying the twelve-cent bottle deposit. This encouraged housewives both to return the empties and buy more. In the 1970s the federal government threatened the franchise system in the soft-drink industry. In 1971 the Federal Trade Commission declared the existing franchises to be illegal restrictions on interstate commerce and sued the major companies. After lengthy hearings, the FTC examiner ruled for the soft-drink companies. While the threat of franchise cancellation hung over their heads, some bottlers turned to cooperatives to build canning plants. Pepsi-Cola built a plant at Conroe, and in July 1970 turned it over to a corporation composed of Texas Pepsi-Cola bottlers. By 1972 West Texas bottlers planned a cooperative to produce Coca-Cola and other franchised products. Amarillo, Lubbock, and Monahans bottlers sought ties with New Mexico and Oklahoma bottlers. They established the Southwest Canners, with J. Conrad Dunagan as president, Pat W. McNamara as vice president, and R. E. Nickles as secretary-treasurer. But Coca-Cola warned that the bottlers who used their franchise territory to host a cooperative could incur substantial liabilities. The organizers also discovered that Texas lacked legislation to permit issuing tax-exempt bonds for industrial development, so Southwest Canners located its plant in Portales, New Mexico, in the Clovis Coca-Cola franchise. New Mexico permitted industrial bonds to acquire land, buildings, and equipment, and an Albuquerque investment bank underwrote $2 million in municipal bonds. The Portales plant opened in the spring of 1975. By then, however, the FTC decision favoring franchises had been overruled-a shocking set-back. The bottlers now sought federal legislation to rescue their franchises. As most congressional districts in Texas had bottling plants, the bottlers found wide support. But Texas representative George H. Mahon, chairman of the Appropriations Committee, would not release the bill. Finally, Sam Hall, of Marshall, introduced a measure to call the bill from committee by a House vote. Both House and Senate approved the measure, and the soft-drink franchise system was saved.
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In the late 1970s and early 1980s, bottling franchises began to consolidate. Coca-Cola, which had relied heavily upon independents until the 1980s, began to purchase large independent bottling groups in 1986 and consolidate them into Coca-Cola Enterprises. In July 1986 CocaCola Enterprises acquired Rainwater Coca-Cola Bottling Companies in Texas, and in September they acquired control of the McAllen and Brownsville Coca-Cola Bottling Companies. By the mid-1990s many of the major urban markets for Coke were serviced by Coca-Cola Enterprises, supplemented by other company franchises and independents. In 1996 Pepsi-Cola had company-owned bottling facilities at Conroe, Houston, Mesquite, and San Antonio, and worked through independent bottlers at Abilene, Hallettsville, and Corpus Christi. Dr Pepper merged with the Seven-Up Company in 1986 and soon thereafter moved its manufacturing operations to facilities in St. Louis, although the company's corporate headquarters remained in Dallas.
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COMPANY PROFILE
ABOUT PEPSICO COMPANY PepsiCo is a world leader in convenient foods and beverages, with 2004 revenues of more than $29 billion and 153,000 employees. The company consists of Frito-Lay North America, PepsiCo Beverages North America, North America, PepsiCo International and Quaker Foods North America. PepsiCo brands are available in nearly 200 countries and territories and generate sales at the retail level of about $78 Billion. Many of PepsiCo’s brand names are more than 100 years old, but the corporation is relatively young. PepsiCo was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay. Tropicana was acquired in1998 and PepsiCo merged with Quaker Oats Company including Gatorade in 2001. PepsiCo’s Mission “To be the world’s premier consumer Products Company focused on convenient foods and beverages. We seek to produce healthy financial rewards to investors as we provide opportunities for growth and growth and enrichment to our employees, business partners
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and the communities in which we operate. And n everything we do, we strive for honesty, fairness and integrity.” PepsiCo’s World Headquarter PepsiCo’s world Headquarter is located in Purchase, New York, approximately 45 minutes from New York City. The seven building headquarters complex was designed by Edward Durrell Stone, one of America’ foremost architects. The building occupies 10 acres of a 144 acre complex that includes the Donald M. Kendall Sculpture Gardens, a world acclaimed sculpture collection in a garden setting.
Pepsi in Nepal
Pepsi started its operation in 1987. It was a franchisee and the franchisor was Mr. Ashok Todi. In 1994 51% of the share were bought by Pepsi International and Mr. Todi remained as one of the director and shareholder of the corporation. Again in 1998 the 51% o=share of Pepsi International were purchased by RKJ Corporation. Later in 2000 100% share was bought by rkJ corporation and RKJ group became the soul owner of the franchisee. Till today it is run by RKJ group under the name of Varun Beverages Private Limited, Nepal. Varun beverages come under the Northern Area in South Asia Territory of the company. CELEBRITIES FOR PEPSI Following are some celebrities for Pepsi : Amitabh Bachchan Shahrukh Khan Saif Ali Khan Fardeen Khan Kareena Kapoor Preity Zinta Sachin Tendulkar
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? ? ? ? ? ? ?
? ? ? ? ? ? ?
Saurav Ganguly Yuvraj Singh Harbhajan Singh Rahul Dravid Zaheer Khan Mohammad Kaif Priyanka Chopra
FAMOUS CATCH LINES Some famous lines of Pepsi are : -
• “Yehi Hai Right Choice Baby……Aaha !!” • “Nothing Official About It” • “Choice of Next Generation” • “More Cricket More Pepsi” • “Yeh Aazadi Hai Dil Ki” • “Yeh Dil mange More” • “Zor Ka Jhatka Dheere Se Lage” • “Pepsi Ke Liye Hum Besharam Hain” • “Yeh Pyaas Hai Badi” • “Do The Dew” • “Oye… Bubbly !!”
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R .K .Jaipuria Group
It can be said with absolute certainty that the RKJ Group has carved out a special niche for itself. Our services touch different aspects of commercial and civilian domains like those of Bottling, food chain and education. Headed by Mr. R. K. Jaipuria, the group as today can lay claim to expertise and leadership in the fields of education, food beverages. The business of the company was started in 1991 with tie- up with Pepsi Foods Limited to manufacture and market Pepsi brand of beverages in geographically pre-defined territories in which brand and technical support was provided by the Principles viz., Pepsi foods Limited. The manufacturing facilities were restricted at Agra Plant, only Varun Beverages Ltd. is the flagship company of the group. The group is also the first franchisee for Yum Restaurants International [formerly Pepsi Co Restaurants (India) Private Limited] in India. It has exclusive franchise rights for the Northern & Eastern India. It has total 27 pizza Hut Restaurants under its company. It diversified into education by opening the first school in Gurgaon under Management of Delhi Public School Society. The schools of the group are run under a registered Trust namely Champa Devi Jaipuria Charitable Trust. Companies are medium sized, professionally managed, unlisted and closely held between Indian Promoters and Foreign collaborators.
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The group added another feather to its cap when the prestigious PepsiCo “International Bottler of the year” award was presented to Mr. R. K. Jaipuria for the year 1998 at a glittering award ceremony at PepsiCo’s centennial year celebrations at Hawai, USA. The award was presented by Mr. Donald M. Roger A. Enrico, Chairman of the Board & C.E.O., PepsiCo Inc. and Mr. Craig Weatherup, President of Pepsi Cola Company. Vision:Being the best in everything we touch and handle. Mission:Continuously excel to achieve and maintain leadership position in the chosen business and delight all stakeholders by making economic value additions in all corporate functions. Success
roduction of innovative, high quality retail branded beverages combined with world class packaging. Driven by management team with a relentless focus on achieving superior customer service, driving earnings improvement and shareholder value. People :RKJ creates an environment where employee enjoy a greater degree of empowerment – both individually and in their work teams.
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The employees are equipped with the necessary tools, training and well management backup for strong performance and accountability, as well as with an environment of open communication and involvement.
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THE RKJ GROUP INVESTMENT COMPANIES CHART
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QUALITY POLICY
• • •
Deliver the best product in the market place The highest Quality The best Tasting
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Different Brands of Pepsi Co.(India) Pepsi Co is today having the soft drinks market in India with lots of its brands. They have also diversified into different sectors. Their popularly exiting brands in the Indian Market are as follows: Soft Drinks 1) Pepsi 2) Pepsi Blue 3) Diet Pepsi 4) Mountain Dew 5) Slice 6) 7Up Purified Drinking Water Aquafina Fruit Juice Tropicana Chips Frito-Lays Ruffles
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Composition of Pepsi Pepsi Contains: Carbonated water, high fructose corn syrup and/or sugar, caramel color, phosphoric acid, caffeine, citric acid and natural flavors Calories 100 Total Fats (g) 0 Sodium (mg) 25 Potassium (mg) 10 Total Carbohydrates (g) 27 Sugars (g) 27 Protein (g) 0 Caffeine (mg) 25 Pepsi Blue Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, natural and artificial flavors, phosphoric acid, potassium citrate, potassium benzoate and potassium sorbate (to preserve freshness), caffeine, gum arabic, ascorbic acid and calcium disodium EDTA (to protect flavor), blue 1, red 40 Calories 100 Total Fats (g) 0 Sodium (mg) 25 Total Carbohydrates (g) 27 Sugars (g) 26 Protein (g) 0 Caffeine (mg) 25
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Diet Pepsi Contains: Carbonated water, caramel color, aspartame, phosphoric acid, potassium benzoate (preserves freshness), caffeine, citric acid and natural flavors Calories 0 Total Fats (g) 0 Sodium (mg) 25 Potassium (mg) 20 Total Carbohydrates (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (mg) 24 PRODUCTION SET UP Greater Noida plant is a dedicated plant for 7 major products. These are as follows : PRODUCT PEPSI MIRINDA ORANGE MIRINDA LEMON SLICE 7- UP EVERVESS SODA MOUNTAIN DEW BOTTLING FILLING 300ML, 200ML 300ML, 200ML 300ML, 200ML 250ML 300ML, 200ML 300ML 200ML & 300ML
Plant is producing 10 million cases every year. Plant has employed about 200 employees on permanent and casual basis. There are 40 mangers/officers/ supervisors and rest of workmen. Plant is dispatching near about125-150 trucks in peak seasons per day to various location. This Plant is spread in peak seasons per day to various location. This plant is spread over 7.5 acre.
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PROBLEMS OF THE ORGANIZATION • • • Service delivery / Logistics perception is weak Negative Environment Top management takes large amount of time to approve high value loan borrowers. COMPETITION INFORMATION • • • • • • COCA-COLA INDIA PVT LTD DABUR INDIA LTD MOUNT EVEREST MINERAL WATERS LTD NARANGS HOSPITALITY SERVICES PVT LTD PARLE AGRO PVT LTD PARLE BISLERI LTD
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History of Coca Cola The first Coca-Cola recipe was invented in a drugstore in Columbus, Geogia by John Pemnerton, originally as a coca wine called Pemnerton’s frensh Wine Cola in 1885. He may have been inspired by the formidable success of Vin Mariani, a European coca wine. In 1886, when Atlanta and Fulton Country passed prohibition legislation, Pemberton responded by developing Coca-Cola, essentially a non-alcoholic version of French Wine Cola. The first sales were at Jacob's Pharmacy in Atlanta, Georgia, on May 8, 1886. It was initially sold as a patent medicine for five cents a glass at soda fountains, which were popular in the United state at the time due to the belief that carbonated water was good for the health. Pemberton claimed Coca-Cola cured many diseases, including morphine addiction, dyspepsia, neurasthenia, headache, and importance. Pemberton ran the first advertisement for the beverage on May 29 of the same year in the Atlanta Journal. By 1888, three versions of Coca-Cola—sold by three separate businesses—were on the market. As a Griggs Candler acquired a stake in Pemberton's company in 1887 and incorporated it as the Coca-Cola in 1888. The same year, while suffering from an ongoing addiction to morphine], Pemberton sold the rights a second time to four more businessmen: J.C.Mayfield, A.O. Murphy, C.O. Mullahy and E.H. Blood worth. Meanwhile, Pemberton's alcoholic [] son Charley Pemnerton began selling his own version of the products. John Pemberton declared that the name "Coca-Cola" belonged to Charley, but the other two manufacturers could continue to use the formula. So, in the summer of 1888, Candler sold his beverage under the names Yum Yum and Coke. After both failed to catch on, Candler set out to establish a legal claim to Coca-Cola in late 1888, in order to force his two competitors out of the business. Candler purchased exclusive right to the formula from John Pemberton, Margaret Dozier and Woolflk Walker. However, in 1914, Dozier came forward to claim her signature on the bill of sale had been forged, and subsequent analysis has indicated John Pemberton's signature was most likely a forgery as well. In 1892 Candler incorporated a second company, The Coca-Cola Company (the current corporation), and in 1910 Candler
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had the earliest records of the company burned, further obscuring its legal origins. By the time of its 50th anniversary, the drink had reached the status of a national icon for the USA. In 1935, it was certified Kosher by Rabbi Tobias Geffen, after the company made minor changes in the sourcing of some ingredients. Coca-Cola was sold in bottles for the first time on March 12, 1894. The first outdoor wall advertisement was painted in the same year as well in Cartesville, Georgia. Cans of Coke first appeared in 1955. The first bottling of Coca-Cola occurred in Vicksburg, Mississippi, at the Biedenharn Candy Company in 1891. Its proprietor was Joseph A. Biedenharn. The original bottles were Biedenharn bottles, very different from the much later hobble-skirt design that is now so familiar. Asa Candler was tentative about bottling the drink, but two entrepreneurs from Chattanooga, Tennessee, Benjamin F. Thomas and Joseph B. Whitehead, proposed the idea and were so persuasive that Candler signed a contract giving them control of the procedure for only one dollar. Candler never collected his dollar, but in 1899 Chattanooga became the site of the first Coca-Cola bottling company. The loosely termed contract proved to be problematic for the company for decades to come. Legal matters were not helped by the decision of the bottlers to subcontract to other companies, effectively becoming parent bottlers. Coke concentrate, or Coke syrup, was and is sold separately at pharmacies in small quantities, as an over-the-counter remedy for nausea or mildly upset stomach. Coca Cola in Nepal Coca Cola started its franchisee in Nepal in 1977 and the franchisor of the company wa Helen Shah. Later the Share was bought by F&N Company and again in 2007 was sold to South Asian Brewery company. Currently it is running with two bottler’s plan and they are Bottler’s Nepal and Bottler’s Nepal Terai which operates in Bagmati zone and Terai area respectively.
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Hierarchy of Pepsi in Nepal
Abbreviation: T.D.M-Territory Development Manager M.D.M-Marketing Development Manager M.E.M-Marketing Equipment Manager A.D.C-Account Development Manager M.D.C-Marketing Development Coordinator M.E.C-Marketing Equipment Manager P.S.R-Pre Sales Representative M.E-Marketing Executive C.E-Customer executive
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S.K.U of Pepsi Size Pepsi Mirinda Dew 7up Slice Soda Diet Pepsi Nimbooz 250 ml ? ? ? ? ? ? ? ? 600ml ? ? ? ? ? ? ? ? 1ltrs ? ? ? ? ? ? ? ? 2ltrs ? ? ? ? ? ? ? ? 1.5ltrs ? ? ? ? ? ? ? ? 250ml(CAN) ? ? ? ? ? ? ? ? 500ltrs 1.2ltrs ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? 200ml(T etra) ? ? ? ? ? ? ? ?
SKU of Coca Cola Size Coke Fanta Sprite Soda Diet Coke 250 ml ? ? ? ? ? 500ml ? ? ? ? ? 1.5ltrs ? ? ? ? ? 2.25ltrs ? ? ? ? ? 250ml(CAN) ? ? ? ? ?
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Promotional Campaign of Pepsi Pepsi launched a campaign for promotion for the products as “Drink and Drive” where the lucky customer wins Suzuki Alto car. The following procedure is followed in order to get the car Get the unique code under the blue cap of your 250ml glass bottled Pepsi SMS the unique code to 3636
• •
Prizes: 1 Suzuki Alto 8 Bajaj Discover Motorbikes 40 Sharp 32” LCD TVs Hundreds of Reebok wrist watches and sunglasses Thousands of footballs Free 250ml Pepsi
• • • • • •
Validity: Offer is available only in 250ml glass bottles with blue color band on the crown From 1st June 2012 (Jesth 19,2069) till 29th July 2012 (Shrawan 14, 2069) Valid only on NTC and Ncell mobile connection Cost per SMS is NRs. 3 (Plus Govt. Taxes).
• • • •
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Promotional Campaign of Coca Cola Coca Cola launched its promotional campaign “Let’s get Crazy”. In the season of Euro Cup 2012 the company set the promotional strategy where the consumer has to sms the answer to the question with the code provided and win the LG LCD television.
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Chapter-2 : Research Methodology
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2.1 Title of the study
The title for the project was “Pepsi Vs Coke Promotional Campaign In Kathmandu”. According to the title of the project I was supposed to perform a comparative study on the effect of the new launched promotional campaign of both Coke and Pepsi i.e. “ Let’s get crazy” and “ Drink and Drive” respectively.
2.2 Duration of the project
The duration for the project was as scheduled by Rajasthan Technical University 45 days in the month June- July.
2.3 Objective of the study
Retailers 1) To know if the retailers are aware of the promotional campaign of the product or not.
2) To find out if the retailers are satisfied with the service of both the companies
3) To find out whose Point of sale among Coke and Pepsi are more.
4) To find out if the products are available in the market or not.
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Consumers
1) To Know if consumers are aware of the promotional strategy or not.
2) To know which among Pepsi and Coca Cola Products are preferred more.
3) To know whose campaign is more attractive and successful.
4) To know the actual reason for the consumers to buy the product.
5) To find out if the consumers are satisfied with the service of both the companies.
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2.4 Type of research
Both Qualitative and Quantitative Research were during the study.
Qualitative Research Objective / purpose • • To gain an understanding of underlying reasons and motivations To provide insights into the setting of a problem, generating ideas and/or hypotheses for later quantitative research To uncover prevalent trends in thought and opinion • • Quantitative Research To quantify data and generalize results from a sample to the population of interest To measure the incidence of various views and opinions in a chosen sample Sometimes followed by qualitative research which is used to explore some findings further
•
•
Sample
Usually a small number of non-representative cases. Respondents selected to fulfill a given quota. Unstructured or semi-structured techniques e.g. individual depth interviews or group discussions.
Usually a large number of cases representing the population of interest. Randomly selected respondents. Structured techniques such as online questionnaires, on-street or telephone interviews.
Data collection
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Outcome
Exploratory and/or investigative. Findings are not conclusive and cannot be used to make generalizations about the population of interest. Develop an initial understanding and sound base for further decision making.
Used to recommend a final course of action.
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2.5 Sample size and Method of sampling The sample size of 50 Retailers and 50 consumers were used. The method used for sampling was Simple Random Sampling:
Simple random sampling is the most intuitive sampling approach. If every household in the population has some unique identifier, such as a number or the name of the head of the household, and you know how many households you want to include in the survey sample, then you could simply write this identifier for each household on a separate piece of paper, put all the pieces of paper in a bag, shake well, and draw as many from the bag as you need to achieve your intended sample size. This is simple random sampling. Simple random sampling:
• •
Involves selection of households which is independent and random Is the basis for most statistical theory, that is:
o o
The most common methods to calculate p values and confidence limits The output from most statistics computer programmes assume simple random sampling
Regardless of what form your data are in, the important characteristic of simple random sampling is that the person doing the selecting has NO CONTROL over which households are selected. The selection is entirely random, and the selection of each household is not dependent on the selection of other households.
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2.6 Scope of the study
The study covers a very important aspect of Marketing i.e. Advertisement and Promotion. How the promotional campaign effects the purchase of a consumer in some goods while for some goods are without vigorous promotion bought and here the advertisement plays the role.
2.7 Limitation of the Study
a) There was lack of interest and unenthusiastic responses from few respondents.
b) Findings are based on the views expressed by the consumers. So it may suffer from biased prejudices.
c) Due to limited number of the sample the project might not provide the entire picture of the Kathmandu as a whole.
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Chapter-3 Analysis and Interpretation
43
Retailers
1. Point of Sales Study was taken place to determine the point of sales of which company is more in the market. The analysis is given below:
POS Coke Pepsi Both 14 32 4
44
2.
Visi Cooler The study was taken place to determine the comparative availability of the Visi Coolers of both the company. The analysis is given below:
Visi Cooler Coke Pepsi None 22 26 2
45
3.
Product Availability The study is to determine which product are more available in the market. The analysis is given below:
Availability Coke Pepsi Both 12 17 21
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4.
Reason to keep the products
The study is conducted to determine why the exclusive retailer prefers to keep the particular product, if it is the demand or the service of the company. The analysis is given below:
Coke
Service Demand
3 9
47
Pepsi
Service Demand
8 9
48
5.
Promotion awareness
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The study is undertaken to determine if the consumers are aware of the promotion of the companies or not.
Yes Coke 19 No 31
Yes Pepsi 22
No 28
50
6.
Level of attractiveness The study was undertaken to determine which product’s promotional strategy was more attractive to the consumers. The analysis is given below:
Coke Pepsi Both
14 5 7
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7.
Source of knowledge The study was undertaken to find out the source from which they came to know about the promotional strategy of the company. The analysis is given below:
Coke Print TV/ Other Company Consum media Radio retailers Prsonnel ers 2 0 2 14 1
52
Print
TV/
Pepsi Other Company 53
Consum
media Radio retailers Prsonnel 2 0 5
ers 15 0
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8.
Reason for purchasing The study was undertaken to determine whether the consumer actually purchase the product for offer or just because they are thirsty. The analysis is given below:
Offer 9
Thirsty 41
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9.
Satisfaction Level of Retailers The study was undertaken to observe whether the retailers were satisfied with each of the company or not.
Highly Satisfied
Coke Satisfie Modrately Satisfied Dissatisfie Highly d d Dissatisfied 6 32 8 4
0
56
Highly Satisfied
Satisfie d 13 34
Pepsi Modrately Satisfied
Dissatisfie Highly d Dissatisfied 1
2
57
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Consumers
1.
Consumption The study was undertaken to find out which product does a consumer prefers more or consumes more. The analysis is given below:
Coke Pepsi Both 23 18 9
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2.
Reason for Purchase The study was undertaken to determine the actual reason for the consumer to purchase the particular product. The analysis is given below:
Coke
Price Service Taste Offer No Particular Reason
1 0 28 0 3
60
Pepsi
Price Service Taste Offer No Particular Reason
3 0 23 1 0
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3.
Awareness about the promotion and its procedure
The study was undertaken to determine whether the consumers were aware of the promotional strategy of coke and Pepsi and if they are whether or not the knew the procedure to win the offer. The analysis is given below:
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Coke
Awareness Of the promotion Yes No 11 39
63
Yes 0
Procedure No 11
64
Pepsi
Awareness Yes 5 No 45
65
66
Yes 0
Procedure No 5
67
4.
Source of knowledge This study was undertaken to know from where did the consumer actually come to know about the promotional campaign of each company:
Coke Print TV/ Retaile Company media Radio rs Prsonnel 4 7 0
Consum ers 0 0
68
Pepsi Print TV/ Retaile Company media Radio rs Prsonnel 0 5 0
Consum ers 0 0
69
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5.
Level of satisfaction The study was undertaken to determine the level of satisfaction in consumers in for each product. The analysis is given below:
Highly Satisfi Satisfied ed 22 7
Coke Modrately Satisfied
Dissatisfi Highly ed Dissatisfied 3 0 0
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Pepsi Highly Satisfi Modrately Dissatisfi Highly Satisfied ed Satisfied ed Dissatisfied 20 4 3 0 0
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Chapter-4 SWOT ANALYSIS
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STRENGTH
-Pepsi has a broader product line and outstanding reputation. -Record revenues and increasing market share. -Lack of capital constraints (availability of large free cash flow) -PepsiCo sells three products through the same distribution channel.
WEAKNESS
-Pepsi hard to inspire vision and direction for large global company. -Not all PepsiCo products bear the company name
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-PepsiCo is far away from leader Coca-cola in the international market-demand is highly elastic.
OPPORTUNITY
-Food division should expand internationally -Non carbonated drinks are the fastest growing part of industry. -There are increasing trend toward healthy foods. -Focus on most important customer trend.
THREATS
-Pepsi is blamed for pesticide residues in their products in one of their most promising and emerging market e.g. in India -Over 50 percent of the company’s sales come from Frito-Lay: this is a threat if the market takes a downturn. -PepsiCo now competes with Cadbury Schweppes,Coca-Cola and Kraft foods which are financially sound.
-Size of company will demand a varied marketing program; Social, cultural, economic, and political and government constraints
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Chapter- 5: Findings
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a) Most of the retailers are not aware of the campaign and who are aware are not aware of the procedure of getting the gift hamper.
b) Most of them are satisfied with the service provided by the companies. The satisfaction level for both of the company is almost equal.
c) The Point of Sales of Pepsi is more than that of Coca- Cola.
d) Both the products are equally available in the market. Their mutual outlets are more than their exclusive markets.
e) The availability of the Visi Cooler of Pepsi is slightly more than that of the Cocacola.
f) The one who know about the campaign mostly came to know about it through company’s personnel.
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g) Most of the consumer prefers to drink Coke over Pepsi and very less consumer drinks both the beverages.
h) The major reason to purchase any of the two product is the taste of the product.
i) Very less consumer know about the promotional campaign of the companies and nobody knows the procedure through which they have to go in order to gain the prize.
j) Among the ones who know most of them came to know about the product through TV/ Radio.
k) Most of the consumers are highly satisfied with both the products.
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Chapter-6: Recommendations
a) Though Pepsi has more POS and Visi Coolers but still it is not able to reach the consumer’s mind. So they should work in reaching the consumers’ mind rather than just trying to create more displays.
b) The sale of both the company is maintained only because of the reputation of the company and their taste. The promotional; strategy though being a very good one has not reached the consumers or retailers. So company should focus in promoting such a manner as to reach the retailers.
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c) The company should promote to the consumers via retailers and give a proper knowledge to retailers about what their offer is all about.
d) The promotional campaign should be such designed as it grabs the attention of the consumers and consumers start thinking about purchasing the product.
e) The company’s personnel should be well informed and well trained as observed there is high default in the company’s personnel as well.
f) Though being a catchy topic the campaign is not as successful as company presumed. So a proper market research all over the Kathmandu should be conducted in order to find out what is the actual reason for its failure.
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Chapter-7: Conclusion
84
The major objective of the study was to find out the comparative success of the promotional
campaign of Coke and Pepsi. The survey gives the researcher the scope opportunity to know the market of a FMCG product at a glimpse and provide detail information about PEPSI. During the study I found out that the consumers were not so much interested in the offers but rather just drinking the beverage. If the promotion would not have been there then there would be little decrease in sale but not in the higher amount. This implies that both the companies were not able to boost up their sales through their promotional campaign. They need to come up with such an idea which can actually seek the attention of the consumers and make them drink it. The objective of the campaign is not only to retain the customers but to attract new ones too but here we observed that the regular drinkers were drinking the product but it was not successful in gaining the new ones. So the company should seriously work on its promotion.
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Chapter- 8: Appendix Questionnaire
For retailers
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Store Name: Location POS Visi cool : : : a) Coke b) Pepsi c) Own
1) Which company’s product do you keep? i) Pepsi ii) Coke iii) Both
What is the reason for keeping the particular Company? a) Coke
b) Pepsi
2) Which company product do most of the consumers ask for? i) Pepsi ii) Coke iii) Both
3) Are you aware about the promotional strategy of? i) Pepsi ( Drink and Drive) a) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? a) Yes b) No
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How did u come to know about it? a) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
ii) Coke( Let’s get crazy) a) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? b) Yes b) No
How did u come to know about it? b) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
4) Why do consumers buy the product? Is it Because of the offer or just because they feel thirsty? i) Thirsty ii) Offer
5) Which offer is more attractive to you? i) Pepsi ii) Coke
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6) What are the extra benefits that company provides to the retailers? i) Pepsi b) Schemes d) Gift Hampers e) Nothing
a) Discount
ii)
Coke
b) Discount
b) Schemes
d) Gift Hampers
e) Nothing
7) Are you satisfied with the companies’ service? i) Coke a) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
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i) Pepsi a) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
For Consumers
Name: Age: Occupation:
1) Which company’s product do you usually consume? i) Pepsi ii) Coke iii) Both
2) What is the reason for you to choose the particular product? i) Price ii) Service iii) Taste iii) The prizes iv) No particular reason
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3) Are you aware about the promotional strategy of? iii) Pepsi ( Drink and Drive) b) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? c) Yes b) No
How did u come to know about it? c) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
iv) Coke( Let’s get crazy) b) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? d) Yes b) No
How did u come to know about it? d) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
4) Why do you buy the product because of the offer or just because you feel thirsty? i) Thirsty ii) Offer
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5) Do you actually see what you got in the crown after drinking or simply throw it? i) See it ii) Throw it
6) Are you satisfied with the product? ii) Coke b) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
iii) Pepsi a) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
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Chapter-9: Bibliography
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WEBSITES: www.pepsi.com www.pepsicoindia,com www.wikipedia.com www.encyclopedia.com BOOKS: Research Methodology- C.R.Kothari Marketing Research- B. S. Bedi Principles of Marketing- P. Kotler & Armstrong
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doc_704887340.doc
Training Undertaken at
Varun Beverages Pvt. Ltd. (PepsiCo.) Kathmandu, Nepal Titled “Pepsi Vs Coke Promotional Campaign in Kathmandu ”
Submitted in partial fulfillment for the Award of degree of Master of Business Administration
Submitted By: Rajesh Chamlagain MBA 2nd Semester 20011-2013
Submitted To:Ms. Astha Jain Head of the Department
1
Preface
Marketing plays vital role in today’s business scenario in consumer product Company, when there is such a high competition in the market.
The emphasis in the project is providing the study and an insight into Indian FMCG Business Scenario. The Summer Project is designed to provide participation of MBA program as on the job experience. This has given a chance to try and apply the academic knowledge and gain insight into corporate culture. This helps in developing decision-making abilities and emphasizes on active participation by the student.
I gained valuable experience & knowledge during the survey. The Project consists of my findings after data analysis & then conclusions were drawn and finally recommendations were put forward.
Keeping all this view the report is being prepared for marketing department of Varun Beverages Private Limited, for the specially assigned topic-“Pepsi V/s Coke promotional Campaign in Kathmandu”.
2
Acknowledgement
I express my sincere thanks to my project guide, Mr. Sushil Tuladhar, Marketing Development Manager, of marketing Department, for guiding me right from the inception till the successful completion of the project. I sincerely acknowledge him for extending their valuable guidance, support for literature, critical reviews of project and the report and above all the moral support he had provided to me with all stages of this project. I would also like to thank the supporting staff pf Marketing Department, for their help and cooperation throughout our project.
(Signature of Student) Rajesh Chamlagain MBA 3rd Semester
3
DECLARATION
I Rajesh Chamlagain declare that this project report entitled market” Pepsi V/S Coke promotional Campaign in Kathmandu”. Project is an original piece of work done and submitted by me towards partial fulfillment of my Post graduate program in MBA, under the guidance of Mr. Sushil Tuladhar (marketing development manager) PepsiCo. ( Kathmandu).
Date…….
…………….. Signature
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Executive Summary
Project Title Name of the Organization Name of the Project Trainee Duration of the project Organizational Guide Institutional Guide Major Objective Pepsi V/S Coke promotional Campaign Varun Beverages Pvt. Ltd. Rajesh Chamlagain 45 Days Mr. Sushil Tuladhar Marketing Development Manager, VBPL Ms. Astha Jain HOD, MBA To find out which of the promotional Campaign launched by Pepsi and Coke was more successful.
5
Table of Contents
Chapter
Chapter-1 Chapter-2 Chapter-3 Chapter-4 Chapter-5 Chapter-6 Chapter-7 Chapter-8 Chapter-9
Content Preface Acknowledgement Declaration Executive Summary Introduction Research Methodology Analysis and Interpretation SWOT Analysis Findings Recommendations Conclusion Appendix Bibliography
Page Number 2 3 4 5 7 34 39 60 62 64 65 66 72
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Chapter-1: Introduction
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OVERVIEW VIEW OF SOFTDRINK INDUSTRY
Soft drink industry scenario the world is almost the same with two major players i.e. Pepsi Co. and Coca-Cola having the major thank in the pie. The other Major player in the industry is Cadbury-Schweppes and some local players in individual countries. The major components of the industry consist of the concentrate manufactures, bottlers and the sales and distribution network of the companies the rule and responsibilities of each of the are different. The major activity taken up by the concentrate 2 India fountain sales form a very insignificant part of the sales revenue. During the initial stages both soft drinks. Majors used a network of independent bottlers to bottle and market their products. Independent bottling arose primarily because it was not possible to create an effective organization for operating a vertically integrated company with hundreds of geographically separated manufacturing unit and local delivery operation given the limited transportation and communication system of the time and the lack of sophisticated financial and management controls. Although Coca-Cola and Pepsi Cola are premier marketing companies the fundamental competitive advantage that allowed that to compete so effectively lies in their ability to operate through a very cumbersome distribution system. In India after the entry of Coke in 1977 the Indian Soft Drink market was controlled by Parle and Pure Drinks. By the end of 1970 Campa Cola was practically alone in cola market Parles introduced Thumbs Up in the beginning of 1980s. By the and of 80’s Parle with Limca, Gold Spot and Thumbs up emerged as clear winner with around 60% market share.
In the year 1985 Pepsi tried to enter into India when it teamed up with RPG group. This proposal was rejected on the grounds that the import of concentrate could not be agreed and the use of foreign brand name was not allowed. In year 1988 Pepsi again floated a project this
8
time in collaboration with Punjab Agro Industrial Corporation (PIAC) and Voltas India Limited and succeeded. Finally in June 1990 Pepsi was launched in India under the brand name of ‘ Lehar Pepsi’. Taking full advantage of the liberalization policies of the government Pepsi set up a new company in India called PepsiCo India Holding Pvt. A wholly around subsidiary Coca Cola company which is a leader in Soft drink industry returned to India after a gap of 16 years in 1995. The most strategic step taken by Coca Cola was the purchase of Parle brands. With this coke instantly had the ownership of countries tap soft drinks brands as well as got access to Parles extensive 54 plant bottling as well as a pre set distribution network. The Texas soft-drink industry dates from 1839, when Dr. Thomas Mitchell, an English physician living in Houston, operated an apothecary with a soda fountain from March until his death on October 1. Carbonated water had bubbled from springs in Europe since Roman times. During the eighteenth century, scientists experimented with "fixed air" and produced "aerated waters." Some of them used bicarbonate of soda in their experiments, and the term "soda water" became ensconced in the English language. By 1810 New York City had "soda fountains," where proprietors dispensed artificial "mineral waters" for therapeutic purposes. Flavored soda water, which developed with the rise of the ice industry, was available in apothecary shops, but bottled soda water was an expensive product. Sailing ships took ice from northeastern states to New Orleans in 1820 and later to Houston, and in 1838 a Houston newspaper noted that ice sold for 50 cents per pound. In 1850 Texas had none of the sixtyfour bottling plants in the nation. The first notice of a soda-water manufacturer in Texas was issued in 1866, when the Houston City Directory listed J. J. C. Smith's establishment as a "mineral water manufactory." In the 1870 census, Galveston and Brownsville reported "manufacturers of mineral and soda water." Victoria and Austin had two ice-making machines. Texas had one of the four ice plants in the nation. In 1880 Texas had eleven bottling plants: four in San Antonio, two each in Galveston and Austin, and one each in Houston, Dallas, and Mexia. In 1890 Texas had forty-two soda-water plants, plus five unspecified bottlers and seven breweries. The 1890s saw major changes in the state's soft-drink industry. New plants appeared with the introduction of the Hutchinson bottle stopper, patented in 1879 and manufactured in Chicago.
9
(In a Hutchinson stopper, a wire loop protruded from the bottle neck and was fastened to a rubber seal; when seated the seal blocked the escape of gas from the water in the drink.) Most plants served one or two counties, and occasionally they shipped by rail to neighboring communities. The bottler's largest investment was in bottles and cases. No deposit was charged and bottle stealing among bottlers was common, even when glass blowers embossed the name of the town on the bottles. In 1891 the Elliott Bottling Works of Paris called a convention to address the problem. Twenty-nine bottlers and suppliers, principally from East Texas, met in October in Dallas and formed the Texas State Bottlers Protective Association. They drafted a constitution and by-laws aimed at preventing "the unlawful use of registered bottles, boxes, siphons, etc." But policing was impossible. By the 1890s two beverages had changed the character of the soft-drink industry. In 1885 Charles Alderton, a Waco pharmacist, originated Dr Pepper Phos-Ferrates (see DR PEPPER COMPANY), and in 1886 John Pemberton concocted Coca-Cola in Atlanta, Georgia. In 1885 Wade B. Morrison, who owned the Old Corner Drug Store in Waco, arranged with Robert Sherman Lazenby, owner of a small bottling plant, to mix and ship Dr Pepper Phos-Ferrates syrup to area drugstores. In 1891 a feed-store operator in Dublin, Texas, began bottling soda waters, including Dr Pepper. Other plants in Central Texas followed suit. However, during the 1890s no Texas bottling plant advertised a franchised soft drink and no company listed such a product in its company or corporate name. In 1898, during the Spanish-American War, Lazenby had an exclusive War Department contract to bottle and ship his Circle A Ginger Ale to servicemen in foreign lands. He supplied both army and navy installations until World War I. In 1900 Texas had 139 soda-water bottling plants. Lemon, ginger, ale, vanilla, orange, sarsaparilla, and raspberry were the principal flavors. The state also had seventy-seven ice plants, more than any other. Only one bottling plant used power-a four-horsepower central motor which delivered power by belts to carbonators and bottle-washing machines. In 1899 two lawyers from Tennessee, B. F. Thomas and Joseph Whitehead, secured "bottling rights" from the Coca-Cola Company of Atlanta, Georgia. They issued contracts to produce and sell Coca-Cola within control areas. Although Texas and parts of New England were excluded, the system provided the capital and the entrepreneurship needed to develop the soft-drink industry nationally. Thomas and Whitehead offered contracts in specific geographic
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regions, Thomas taking the northern and eastern states and Pacific coast and Whitehead taking the South and Southwest. Thomas built a bottling plant in Chattanooga, Tennessee, and Whitehead built one in Atlanta. Whitehead sold a half interest to J. T. Lupton, a lawyer from a Virginia tobacco family. Lupton helped finance the Coca-Cola bottling plant in Atlanta, and in 1902 his relatives opened plants in Dallas and Houston. Within three years Coca-Cola was selling its syrup to twenty-nine Texas plants. Soft drinks were among the first consumer products controlled by the franchise system. In 1914 twenty Texas bottlers listed Coca-Cola as part of their trade name, and eight did not. Other Texas companies did not issue franchises until the 1920s. Delaware Punch, a noncarbonated drink formulated in 1913 in San Antonio, was among the first to join Coca-Cola in issuing franchises in Texas. Between 1899 and 1914 the number of Texas plants doubled and the value of production tripled. In 1914 Texas had 262 plants (4.8 percent of the nation's total), but only the Coca-Cola bottlers included the franchise in their trade name. Between 1914 and 1924 a number of flavor manufacturers or distributors began offering franchises patterned after the Coca-Cola model. In 1922 Texas had 179 bottling works, but only 33 included a copyrighted soft drink in their trade name-30 with Coca-Cola and 3 with Whistle. By 1923 Texas had 205 plants (of 4,514 nationally). In 1924 nine bottlers were producing "cola" drinks besides Coca-Cola, including Chero-Cola, Tex-A-Cola, Lime Cola, Keen Kola, and Cola Hiball. Cola-Cola filed a lawsuit against all "imitators," won a raft of court decisions, and stopped the traffic for a decade. The Chero-Cola Company of Columbus, Georgia, changed its corporate name to Nehi Company and promoted fruit flavors. Other franchises in Texas included Whistle (six plants), Orange Crush (three), NuGrape (one), Grapico (two), and Cherry Blossoms (one). Bottling plants also manufactured other merchandise: ice (five plants), ice cream (ten), candy (eleven), creamery products (three), and beer (one). Out of 276 bottling firms, 114 produced no franchised soft drinks. In 1924 Texas bottlers marketed eleven trademarked products. By 1929 the state had thirty-four Nehi plants, ten Dr Pepper plants with name identification by trademark, three Orange Squeeze plants, and six other plants incorporating a beverage name. Coca-Cola gave bottlers "exclusive rights" to use its trademark in 6½-ounce returnable bottles in a specific territory. In
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1929 Texas had 325 bottling plants, 16.3 percent of the national total. The number declined to 260 in 1931 and 210 in 1933. During the Great Depression, Seven-Up and Pepsi-Cola sought markets in Texas, mainly under the promotion of Jodie W. McCarley of San Antonio. While shagging baseballs for the Cleveland Indians in St. Louis, McCarley met Pearl Whitcraft and Ed Taylor, who owned soda-water plants in the city. In 1929 Taylor offered McCarley a chance to get in the bottling business by assuming a debt owed a St. Louis flavor manufacturer. McCarley set up a small bottling plant in his home in San Antonio with second-hand machinery, and peddled his drinks each morning. In addition to generic flavors, he sold Knight Club Ginger Ale, mostly to bootleggers. Ed Taylor also put McCarley in touch with C. L. Griggs, owner of the Howdy Company, which offered franchises on Howdy Orange. In 1928 Griggs had copyrighted Seven-Up, a lithiated lemon drink promoted as a mixer. In January 1930 McCarley, the second bottler in the nation to receive a Seven-Up franchise (Taylor was the first), was given an opportunity to sell Seven-Up in seventy-eight Texas counties. Business was slow: he signed up only one bottler, Ed Knebel, who had moved his small plant from Pflugerville to Austin in 1930. In 1932 McCarley obtained a franchise to sell Hires Root Beer. Then Whitcraft notified McCarley that Pepsi-Cola was interested in Texas, and on April 1, 1934, McCarley and a partner secured a Pepsi-Cola franchise for sixty-four counties. McCarley was the first Texan to bottle Pepsi-Cola. In his first year he sold 13,300 cases of Pepsi in twelve-ounce beer bottles of brown, green, and "flint" (colorless). As his business expanded, he began operating five route trucks, and in 1937 he moved to a larger plant in San Antonio. By the 1930s, Pepsi and Nehi's Royal Crown Cola had established markets in Texas. Nehi had a statewide system known as Chero-Cola bottlers. Depression prices enabled bottlers to offer twelve-ounce drinks for five cents retail, and twelve-ounce bottles became popular. Between 1934 and 1939 Pepsi signed up bottlers in eighteen Texas towns, though many of these did not survive. Texas bottlers were highly competitive. With Cola-Cola leading the way, they maintained an eighty-cent wholesale price for a case of twenty-four bottles. The Coca-Cola franchise system had developed, however, when each plant served an area that a horse-drawn truck could
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cover in a day. The motor truck expanded dealer territories. Although each community had a wealthy Coca-Cola bottler, Walter Mack, Pepsi president in 1938-39, saw opportunities. CocaCola maintained 1,150 franchise areas in the nation, but Mack was able to franchise 550 areas for Pepsi. Pepsi also ran ads at independent radio stations and later on the networks. By early 1938 many Texas Coca-Cola bottlers, under company pressure, had dropped all flavors except Coca-Cola. Dr Pepper started franchising in 1925 and offered the drink to Coca-Cola bottlers, who declined to accept. In 1938 the Texas soft-drink industry comprised 297 plants. Most held multiple franchises. At the outbreak of World War II, the soft-drink industry faced rationing of sugar, crown caps, cork, gasoline, tires, trucks, and coolers. Though prices were frozen and labor became scarce, bottlers profited from the military bases established in Texas, since quota-exempt sugar was available to the military, which deemed soft drinks essential to morale. Coca-Cola promptly moved its vending machines, introduced in the late 1930s in service stations, grocery stores, and at-work outlets, to military bases. Few bottlers had vending machines, especially multiple choice vending. These bottlers found markets at the Post Exchanges. After the war, soft drink demand soared. On October 23, 1946, wartime controls were lifted, but sugar rationing continued until July 28, 1947. Bottlers were reluctant to break the "nickel price." Coca-Cola advanced its price from 80 cents to 90 cents to $1 a case, but still did not raise the retail price of 5 cents. Some coin-vending machines had a six-cent mechanism, but they were awkward to use. While Coca-Cola kept sales prices down, other companies, especially Pepsi and RC Cola, were stuck with a twelve-ounce bottle and its higher ingredient costs. In1955 Coca-Cola introduced the "king-size" (ten or twelve ounce) and the "family-size" bottles (twenty-six ounces). The family-size returnable became popular in Texas, particularly in urban areas. Dr Pepper and Seven-Up followed. Nehi had authorized the "Par-T-Pak" in quart or family size in the 1930s, but sales had been slow. Bottlers soon saw the economy of returnable bottles. As prices and bottle sizes increased, a conflict loomed between "big-bottle bottlers" and "little-bottle bottlers." Clifton C. Carter, a vice president of the Texas State Bottlers Association, sought to resolve the problem. In 1952 the Texas State Bottlers Association enrolled 226 bottling plants as dues-paying members; 145 plants were
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non-members. Carter, membership chairman, sought new members and saw a major increase in membership to 71 percent of total Texas bottlers. In February 1954 Carter became president, W. L. "Brownie" Dorris became vice president, and J. Conrad Dunagan became second vice president. Association officers made swings through Texas to enlist members. Carter visited eleven cities, Dorris nine, and Dunagan five. Their efforts bore fruit. By enlisting members, the association began to defuse the bottling controversy and other problems. In 1957 the American Bottlers of Carbonated Beverages, of which the Texas State Bottlers had been an affiliate since 1919, cited the Texas group as the "outstanding state bottlers' association in the nation." Dunagan was elected to the ABCB Executive Board in 1961 to the presidency for 1957-58. Texas, with more ABCB members than any other state, brought the national convention to Dallas in 1961. Vice President Lyndon B. Johnson gave the keynote address. As the Texas bottlers worked out their differences, innovations changed the industry in packaging, manufacturing, and distribution. Cans with linings that could withstand the acidity of soft drinks were introduced, along with materials to withstand high degrees of carbonation. Calcium Cyclamate and sodium cyclamate were combined with the synthetic sweetener saccharin to produce an acceptable diet drink. Nehi had tried to market Diet Rite in 1952 in Texas, but acceptance was spotty. However, diet drinks gained steadily and reached an annual rate of 15 percent of the soft-drink market by 1969. Major soft-drink companies, as well as major brewers, had developed canned drinks during World War II, but a "metallic" taste persisted because the cans lacked special acid-resistant linings. Coco-Cola introduced canned drinks in 1960, when it authorized the Kimble Food Products Company of Fort Worth to offer canned Coca-Cola to franchised bottlers. Although supermarkets quickly accepted canned drinks, they sold only 450 million cans in 1954, a fraction of the 30.3 billion bottles sold. Canned-drink sales fell to 317 million by 1956, when Royal Crown, Nehi, and Par-T-Pak entered the market. Canned RC Cola, Diet Rite, and Nehi flavors arrived in Texas by rail from Columbus, Georgia. The glass-container industry, aware that Texas supermarkets objected to handling returnable bottles, introduced light-weight glass bottles. The larger sizes, twenty-six to thirty-two ounces, easily competed with aluminum and steel cans. Marketing strategies also changed. In the 1920s, soft drinks were sold for home consumption. Grocery stores offered a
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twenty-four-bottle wooden case, and plants also sold cases from the floor or loading docks. In 1922 Coca-Cola sought additional markets by producing a cardboard six-bottle carton, but the boxes were too expensive for one-trip use. Strengthened paperboard solved the problem. In 1933 Coca-Cola distributed 2 cent postcards to bottlers for stores to use as coupons with which a customer could received a free six-pack by paying the twelve-cent bottle deposit. This encouraged housewives both to return the empties and buy more. In the 1970s the federal government threatened the franchise system in the soft-drink industry. In 1971 the Federal Trade Commission declared the existing franchises to be illegal restrictions on interstate commerce and sued the major companies. After lengthy hearings, the FTC examiner ruled for the soft-drink companies. While the threat of franchise cancellation hung over their heads, some bottlers turned to cooperatives to build canning plants. Pepsi-Cola built a plant at Conroe, and in July 1970 turned it over to a corporation composed of Texas Pepsi-Cola bottlers. By 1972 West Texas bottlers planned a cooperative to produce Coca-Cola and other franchised products. Amarillo, Lubbock, and Monahans bottlers sought ties with New Mexico and Oklahoma bottlers. They established the Southwest Canners, with J. Conrad Dunagan as president, Pat W. McNamara as vice president, and R. E. Nickles as secretary-treasurer. But Coca-Cola warned that the bottlers who used their franchise territory to host a cooperative could incur substantial liabilities. The organizers also discovered that Texas lacked legislation to permit issuing tax-exempt bonds for industrial development, so Southwest Canners located its plant in Portales, New Mexico, in the Clovis Coca-Cola franchise. New Mexico permitted industrial bonds to acquire land, buildings, and equipment, and an Albuquerque investment bank underwrote $2 million in municipal bonds. The Portales plant opened in the spring of 1975. By then, however, the FTC decision favoring franchises had been overruled-a shocking set-back. The bottlers now sought federal legislation to rescue their franchises. As most congressional districts in Texas had bottling plants, the bottlers found wide support. But Texas representative George H. Mahon, chairman of the Appropriations Committee, would not release the bill. Finally, Sam Hall, of Marshall, introduced a measure to call the bill from committee by a House vote. Both House and Senate approved the measure, and the soft-drink franchise system was saved.
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In the late 1970s and early 1980s, bottling franchises began to consolidate. Coca-Cola, which had relied heavily upon independents until the 1980s, began to purchase large independent bottling groups in 1986 and consolidate them into Coca-Cola Enterprises. In July 1986 CocaCola Enterprises acquired Rainwater Coca-Cola Bottling Companies in Texas, and in September they acquired control of the McAllen and Brownsville Coca-Cola Bottling Companies. By the mid-1990s many of the major urban markets for Coke were serviced by Coca-Cola Enterprises, supplemented by other company franchises and independents. In 1996 Pepsi-Cola had company-owned bottling facilities at Conroe, Houston, Mesquite, and San Antonio, and worked through independent bottlers at Abilene, Hallettsville, and Corpus Christi. Dr Pepper merged with the Seven-Up Company in 1986 and soon thereafter moved its manufacturing operations to facilities in St. Louis, although the company's corporate headquarters remained in Dallas.
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COMPANY PROFILE
ABOUT PEPSICO COMPANY PepsiCo is a world leader in convenient foods and beverages, with 2004 revenues of more than $29 billion and 153,000 employees. The company consists of Frito-Lay North America, PepsiCo Beverages North America, North America, PepsiCo International and Quaker Foods North America. PepsiCo brands are available in nearly 200 countries and territories and generate sales at the retail level of about $78 Billion. Many of PepsiCo’s brand names are more than 100 years old, but the corporation is relatively young. PepsiCo was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay. Tropicana was acquired in1998 and PepsiCo merged with Quaker Oats Company including Gatorade in 2001. PepsiCo’s Mission “To be the world’s premier consumer Products Company focused on convenient foods and beverages. We seek to produce healthy financial rewards to investors as we provide opportunities for growth and growth and enrichment to our employees, business partners
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and the communities in which we operate. And n everything we do, we strive for honesty, fairness and integrity.” PepsiCo’s World Headquarter PepsiCo’s world Headquarter is located in Purchase, New York, approximately 45 minutes from New York City. The seven building headquarters complex was designed by Edward Durrell Stone, one of America’ foremost architects. The building occupies 10 acres of a 144 acre complex that includes the Donald M. Kendall Sculpture Gardens, a world acclaimed sculpture collection in a garden setting.
Pepsi in Nepal
Pepsi started its operation in 1987. It was a franchisee and the franchisor was Mr. Ashok Todi. In 1994 51% of the share were bought by Pepsi International and Mr. Todi remained as one of the director and shareholder of the corporation. Again in 1998 the 51% o=share of Pepsi International were purchased by RKJ Corporation. Later in 2000 100% share was bought by rkJ corporation and RKJ group became the soul owner of the franchisee. Till today it is run by RKJ group under the name of Varun Beverages Private Limited, Nepal. Varun beverages come under the Northern Area in South Asia Territory of the company. CELEBRITIES FOR PEPSI Following are some celebrities for Pepsi : Amitabh Bachchan Shahrukh Khan Saif Ali Khan Fardeen Khan Kareena Kapoor Preity Zinta Sachin Tendulkar
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? ? ? ? ? ? ?
? ? ? ? ? ? ?
Saurav Ganguly Yuvraj Singh Harbhajan Singh Rahul Dravid Zaheer Khan Mohammad Kaif Priyanka Chopra
FAMOUS CATCH LINES Some famous lines of Pepsi are : -
• “Yehi Hai Right Choice Baby……Aaha !!” • “Nothing Official About It” • “Choice of Next Generation” • “More Cricket More Pepsi” • “Yeh Aazadi Hai Dil Ki” • “Yeh Dil mange More” • “Zor Ka Jhatka Dheere Se Lage” • “Pepsi Ke Liye Hum Besharam Hain” • “Yeh Pyaas Hai Badi” • “Do The Dew” • “Oye… Bubbly !!”
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R .K .Jaipuria Group
It can be said with absolute certainty that the RKJ Group has carved out a special niche for itself. Our services touch different aspects of commercial and civilian domains like those of Bottling, food chain and education. Headed by Mr. R. K. Jaipuria, the group as today can lay claim to expertise and leadership in the fields of education, food beverages. The business of the company was started in 1991 with tie- up with Pepsi Foods Limited to manufacture and market Pepsi brand of beverages in geographically pre-defined territories in which brand and technical support was provided by the Principles viz., Pepsi foods Limited. The manufacturing facilities were restricted at Agra Plant, only Varun Beverages Ltd. is the flagship company of the group. The group is also the first franchisee for Yum Restaurants International [formerly Pepsi Co Restaurants (India) Private Limited] in India. It has exclusive franchise rights for the Northern & Eastern India. It has total 27 pizza Hut Restaurants under its company. It diversified into education by opening the first school in Gurgaon under Management of Delhi Public School Society. The schools of the group are run under a registered Trust namely Champa Devi Jaipuria Charitable Trust. Companies are medium sized, professionally managed, unlisted and closely held between Indian Promoters and Foreign collaborators.
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The group added another feather to its cap when the prestigious PepsiCo “International Bottler of the year” award was presented to Mr. R. K. Jaipuria for the year 1998 at a glittering award ceremony at PepsiCo’s centennial year celebrations at Hawai, USA. The award was presented by Mr. Donald M. Roger A. Enrico, Chairman of the Board & C.E.O., PepsiCo Inc. and Mr. Craig Weatherup, President of Pepsi Cola Company. Vision:Being the best in everything we touch and handle. Mission:Continuously excel to achieve and maintain leadership position in the chosen business and delight all stakeholders by making economic value additions in all corporate functions. Success
roduction of innovative, high quality retail branded beverages combined with world class packaging. Driven by management team with a relentless focus on achieving superior customer service, driving earnings improvement and shareholder value. People :RKJ creates an environment where employee enjoy a greater degree of empowerment – both individually and in their work teams.21
The employees are equipped with the necessary tools, training and well management backup for strong performance and accountability, as well as with an environment of open communication and involvement.
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THE RKJ GROUP INVESTMENT COMPANIES CHART
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QUALITY POLICY
• • •
Deliver the best product in the market place The highest Quality The best Tasting
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Different Brands of Pepsi Co.(India) Pepsi Co is today having the soft drinks market in India with lots of its brands. They have also diversified into different sectors. Their popularly exiting brands in the Indian Market are as follows: Soft Drinks 1) Pepsi 2) Pepsi Blue 3) Diet Pepsi 4) Mountain Dew 5) Slice 6) 7Up Purified Drinking Water Aquafina Fruit Juice Tropicana Chips Frito-Lays Ruffles
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Composition of Pepsi Pepsi Contains: Carbonated water, high fructose corn syrup and/or sugar, caramel color, phosphoric acid, caffeine, citric acid and natural flavors Calories 100 Total Fats (g) 0 Sodium (mg) 25 Potassium (mg) 10 Total Carbohydrates (g) 27 Sugars (g) 27 Protein (g) 0 Caffeine (mg) 25 Pepsi Blue Contains: Carbonated water, high fructose corn syrup and/or sugar, citric acid, natural and artificial flavors, phosphoric acid, potassium citrate, potassium benzoate and potassium sorbate (to preserve freshness), caffeine, gum arabic, ascorbic acid and calcium disodium EDTA (to protect flavor), blue 1, red 40 Calories 100 Total Fats (g) 0 Sodium (mg) 25 Total Carbohydrates (g) 27 Sugars (g) 26 Protein (g) 0 Caffeine (mg) 25
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Diet Pepsi Contains: Carbonated water, caramel color, aspartame, phosphoric acid, potassium benzoate (preserves freshness), caffeine, citric acid and natural flavors Calories 0 Total Fats (g) 0 Sodium (mg) 25 Potassium (mg) 20 Total Carbohydrates (g) 0 Sugars (g) 0 Protein (g) 0 Caffeine (mg) 24 PRODUCTION SET UP Greater Noida plant is a dedicated plant for 7 major products. These are as follows : PRODUCT PEPSI MIRINDA ORANGE MIRINDA LEMON SLICE 7- UP EVERVESS SODA MOUNTAIN DEW BOTTLING FILLING 300ML, 200ML 300ML, 200ML 300ML, 200ML 250ML 300ML, 200ML 300ML 200ML & 300ML
Plant is producing 10 million cases every year. Plant has employed about 200 employees on permanent and casual basis. There are 40 mangers/officers/ supervisors and rest of workmen. Plant is dispatching near about125-150 trucks in peak seasons per day to various location. This Plant is spread in peak seasons per day to various location. This plant is spread over 7.5 acre.
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PROBLEMS OF THE ORGANIZATION • • • Service delivery / Logistics perception is weak Negative Environment Top management takes large amount of time to approve high value loan borrowers. COMPETITION INFORMATION • • • • • • COCA-COLA INDIA PVT LTD DABUR INDIA LTD MOUNT EVEREST MINERAL WATERS LTD NARANGS HOSPITALITY SERVICES PVT LTD PARLE AGRO PVT LTD PARLE BISLERI LTD
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History of Coca Cola The first Coca-Cola recipe was invented in a drugstore in Columbus, Geogia by John Pemnerton, originally as a coca wine called Pemnerton’s frensh Wine Cola in 1885. He may have been inspired by the formidable success of Vin Mariani, a European coca wine. In 1886, when Atlanta and Fulton Country passed prohibition legislation, Pemberton responded by developing Coca-Cola, essentially a non-alcoholic version of French Wine Cola. The first sales were at Jacob's Pharmacy in Atlanta, Georgia, on May 8, 1886. It was initially sold as a patent medicine for five cents a glass at soda fountains, which were popular in the United state at the time due to the belief that carbonated water was good for the health. Pemberton claimed Coca-Cola cured many diseases, including morphine addiction, dyspepsia, neurasthenia, headache, and importance. Pemberton ran the first advertisement for the beverage on May 29 of the same year in the Atlanta Journal. By 1888, three versions of Coca-Cola—sold by three separate businesses—were on the market. As a Griggs Candler acquired a stake in Pemberton's company in 1887 and incorporated it as the Coca-Cola in 1888. The same year, while suffering from an ongoing addiction to morphine], Pemberton sold the rights a second time to four more businessmen: J.C.Mayfield, A.O. Murphy, C.O. Mullahy and E.H. Blood worth. Meanwhile, Pemberton's alcoholic [] son Charley Pemnerton began selling his own version of the products. John Pemberton declared that the name "Coca-Cola" belonged to Charley, but the other two manufacturers could continue to use the formula. So, in the summer of 1888, Candler sold his beverage under the names Yum Yum and Coke. After both failed to catch on, Candler set out to establish a legal claim to Coca-Cola in late 1888, in order to force his two competitors out of the business. Candler purchased exclusive right to the formula from John Pemberton, Margaret Dozier and Woolflk Walker. However, in 1914, Dozier came forward to claim her signature on the bill of sale had been forged, and subsequent analysis has indicated John Pemberton's signature was most likely a forgery as well. In 1892 Candler incorporated a second company, The Coca-Cola Company (the current corporation), and in 1910 Candler
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had the earliest records of the company burned, further obscuring its legal origins. By the time of its 50th anniversary, the drink had reached the status of a national icon for the USA. In 1935, it was certified Kosher by Rabbi Tobias Geffen, after the company made minor changes in the sourcing of some ingredients. Coca-Cola was sold in bottles for the first time on March 12, 1894. The first outdoor wall advertisement was painted in the same year as well in Cartesville, Georgia. Cans of Coke first appeared in 1955. The first bottling of Coca-Cola occurred in Vicksburg, Mississippi, at the Biedenharn Candy Company in 1891. Its proprietor was Joseph A. Biedenharn. The original bottles were Biedenharn bottles, very different from the much later hobble-skirt design that is now so familiar. Asa Candler was tentative about bottling the drink, but two entrepreneurs from Chattanooga, Tennessee, Benjamin F. Thomas and Joseph B. Whitehead, proposed the idea and were so persuasive that Candler signed a contract giving them control of the procedure for only one dollar. Candler never collected his dollar, but in 1899 Chattanooga became the site of the first Coca-Cola bottling company. The loosely termed contract proved to be problematic for the company for decades to come. Legal matters were not helped by the decision of the bottlers to subcontract to other companies, effectively becoming parent bottlers. Coke concentrate, or Coke syrup, was and is sold separately at pharmacies in small quantities, as an over-the-counter remedy for nausea or mildly upset stomach. Coca Cola in Nepal Coca Cola started its franchisee in Nepal in 1977 and the franchisor of the company wa Helen Shah. Later the Share was bought by F&N Company and again in 2007 was sold to South Asian Brewery company. Currently it is running with two bottler’s plan and they are Bottler’s Nepal and Bottler’s Nepal Terai which operates in Bagmati zone and Terai area respectively.
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Hierarchy of Pepsi in Nepal
Abbreviation: T.D.M-Territory Development Manager M.D.M-Marketing Development Manager M.E.M-Marketing Equipment Manager A.D.C-Account Development Manager M.D.C-Marketing Development Coordinator M.E.C-Marketing Equipment Manager P.S.R-Pre Sales Representative M.E-Marketing Executive C.E-Customer executive
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S.K.U of Pepsi Size Pepsi Mirinda Dew 7up Slice Soda Diet Pepsi Nimbooz 250 ml ? ? ? ? ? ? ? ? 600ml ? ? ? ? ? ? ? ? 1ltrs ? ? ? ? ? ? ? ? 2ltrs ? ? ? ? ? ? ? ? 1.5ltrs ? ? ? ? ? ? ? ? 250ml(CAN) ? ? ? ? ? ? ? ? 500ltrs 1.2ltrs ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? 200ml(T etra) ? ? ? ? ? ? ? ?
SKU of Coca Cola Size Coke Fanta Sprite Soda Diet Coke 250 ml ? ? ? ? ? 500ml ? ? ? ? ? 1.5ltrs ? ? ? ? ? 2.25ltrs ? ? ? ? ? 250ml(CAN) ? ? ? ? ?
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Promotional Campaign of Pepsi Pepsi launched a campaign for promotion for the products as “Drink and Drive” where the lucky customer wins Suzuki Alto car. The following procedure is followed in order to get the car Get the unique code under the blue cap of your 250ml glass bottled Pepsi SMS the unique code to 3636
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Prizes: 1 Suzuki Alto 8 Bajaj Discover Motorbikes 40 Sharp 32” LCD TVs Hundreds of Reebok wrist watches and sunglasses Thousands of footballs Free 250ml Pepsi
• • • • • •
Validity: Offer is available only in 250ml glass bottles with blue color band on the crown From 1st June 2012 (Jesth 19,2069) till 29th July 2012 (Shrawan 14, 2069) Valid only on NTC and Ncell mobile connection Cost per SMS is NRs. 3 (Plus Govt. Taxes).
• • • •
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Promotional Campaign of Coca Cola Coca Cola launched its promotional campaign “Let’s get Crazy”. In the season of Euro Cup 2012 the company set the promotional strategy where the consumer has to sms the answer to the question with the code provided and win the LG LCD television.
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Chapter-2 : Research Methodology
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2.1 Title of the study
The title for the project was “Pepsi Vs Coke Promotional Campaign In Kathmandu”. According to the title of the project I was supposed to perform a comparative study on the effect of the new launched promotional campaign of both Coke and Pepsi i.e. “ Let’s get crazy” and “ Drink and Drive” respectively.
2.2 Duration of the project
The duration for the project was as scheduled by Rajasthan Technical University 45 days in the month June- July.
2.3 Objective of the study
Retailers 1) To know if the retailers are aware of the promotional campaign of the product or not.
2) To find out if the retailers are satisfied with the service of both the companies
3) To find out whose Point of sale among Coke and Pepsi are more.
4) To find out if the products are available in the market or not.
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Consumers
1) To Know if consumers are aware of the promotional strategy or not.
2) To know which among Pepsi and Coca Cola Products are preferred more.
3) To know whose campaign is more attractive and successful.
4) To know the actual reason for the consumers to buy the product.
5) To find out if the consumers are satisfied with the service of both the companies.
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2.4 Type of research
Both Qualitative and Quantitative Research were during the study.
Qualitative Research Objective / purpose • • To gain an understanding of underlying reasons and motivations To provide insights into the setting of a problem, generating ideas and/or hypotheses for later quantitative research To uncover prevalent trends in thought and opinion • • Quantitative Research To quantify data and generalize results from a sample to the population of interest To measure the incidence of various views and opinions in a chosen sample Sometimes followed by qualitative research which is used to explore some findings further
•
•
Sample
Usually a small number of non-representative cases. Respondents selected to fulfill a given quota. Unstructured or semi-structured techniques e.g. individual depth interviews or group discussions.
Usually a large number of cases representing the population of interest. Randomly selected respondents. Structured techniques such as online questionnaires, on-street or telephone interviews.
Data collection
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Outcome
Exploratory and/or investigative. Findings are not conclusive and cannot be used to make generalizations about the population of interest. Develop an initial understanding and sound base for further decision making.
Used to recommend a final course of action.
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2.5 Sample size and Method of sampling The sample size of 50 Retailers and 50 consumers were used. The method used for sampling was Simple Random Sampling:
Simple random sampling is the most intuitive sampling approach. If every household in the population has some unique identifier, such as a number or the name of the head of the household, and you know how many households you want to include in the survey sample, then you could simply write this identifier for each household on a separate piece of paper, put all the pieces of paper in a bag, shake well, and draw as many from the bag as you need to achieve your intended sample size. This is simple random sampling. Simple random sampling:
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Involves selection of households which is independent and random Is the basis for most statistical theory, that is:
o o
The most common methods to calculate p values and confidence limits The output from most statistics computer programmes assume simple random sampling
Regardless of what form your data are in, the important characteristic of simple random sampling is that the person doing the selecting has NO CONTROL over which households are selected. The selection is entirely random, and the selection of each household is not dependent on the selection of other households.
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2.6 Scope of the study
The study covers a very important aspect of Marketing i.e. Advertisement and Promotion. How the promotional campaign effects the purchase of a consumer in some goods while for some goods are without vigorous promotion bought and here the advertisement plays the role.
2.7 Limitation of the Study
a) There was lack of interest and unenthusiastic responses from few respondents.
b) Findings are based on the views expressed by the consumers. So it may suffer from biased prejudices.
c) Due to limited number of the sample the project might not provide the entire picture of the Kathmandu as a whole.
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Chapter-3 Analysis and Interpretation
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Retailers
1. Point of Sales Study was taken place to determine the point of sales of which company is more in the market. The analysis is given below:
POS Coke Pepsi Both 14 32 4
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2.
Visi Cooler The study was taken place to determine the comparative availability of the Visi Coolers of both the company. The analysis is given below:
Visi Cooler Coke Pepsi None 22 26 2
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3.
Product Availability The study is to determine which product are more available in the market. The analysis is given below:
Availability Coke Pepsi Both 12 17 21
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4.
Reason to keep the products
The study is conducted to determine why the exclusive retailer prefers to keep the particular product, if it is the demand or the service of the company. The analysis is given below:
Coke
Service Demand
3 9
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Pepsi
Service Demand
8 9
48
5.
Promotion awareness
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The study is undertaken to determine if the consumers are aware of the promotion of the companies or not.
Yes Coke 19 No 31
Yes Pepsi 22
No 28
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6.
Level of attractiveness The study was undertaken to determine which product’s promotional strategy was more attractive to the consumers. The analysis is given below:
Coke Pepsi Both
14 5 7
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7.
Source of knowledge The study was undertaken to find out the source from which they came to know about the promotional strategy of the company. The analysis is given below:
Coke Print TV/ Other Company Consum media Radio retailers Prsonnel ers 2 0 2 14 1
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TV/
Pepsi Other Company 53
Consum
media Radio retailers Prsonnel 2 0 5
ers 15 0
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8.
Reason for purchasing The study was undertaken to determine whether the consumer actually purchase the product for offer or just because they are thirsty. The analysis is given below:
Offer 9
Thirsty 41
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9.
Satisfaction Level of Retailers The study was undertaken to observe whether the retailers were satisfied with each of the company or not.
Highly Satisfied
Coke Satisfie Modrately Satisfied Dissatisfie Highly d d Dissatisfied 6 32 8 4
0
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Highly Satisfied
Satisfie d 13 34
Pepsi Modrately Satisfied
Dissatisfie Highly d Dissatisfied 1
2
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Consumers
1.
Consumption The study was undertaken to find out which product does a consumer prefers more or consumes more. The analysis is given below:
Coke Pepsi Both 23 18 9
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2.
Reason for Purchase The study was undertaken to determine the actual reason for the consumer to purchase the particular product. The analysis is given below:
Coke
Price Service Taste Offer No Particular Reason
1 0 28 0 3
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Pepsi
Price Service Taste Offer No Particular Reason
3 0 23 1 0
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3.
Awareness about the promotion and its procedure
The study was undertaken to determine whether the consumers were aware of the promotional strategy of coke and Pepsi and if they are whether or not the knew the procedure to win the offer. The analysis is given below:
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Coke
Awareness Of the promotion Yes No 11 39
63
Yes 0
Procedure No 11
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Pepsi
Awareness Yes 5 No 45
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66
Yes 0
Procedure No 5
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4.
Source of knowledge This study was undertaken to know from where did the consumer actually come to know about the promotional campaign of each company:
Coke Print TV/ Retaile Company media Radio rs Prsonnel 4 7 0
Consum ers 0 0
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Pepsi Print TV/ Retaile Company media Radio rs Prsonnel 0 5 0
Consum ers 0 0
69
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5.
Level of satisfaction The study was undertaken to determine the level of satisfaction in consumers in for each product. The analysis is given below:
Highly Satisfi Satisfied ed 22 7
Coke Modrately Satisfied
Dissatisfi Highly ed Dissatisfied 3 0 0
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Pepsi Highly Satisfi Modrately Dissatisfi Highly Satisfied ed Satisfied ed Dissatisfied 20 4 3 0 0
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Chapter-4 SWOT ANALYSIS
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STRENGTH
-Pepsi has a broader product line and outstanding reputation. -Record revenues and increasing market share. -Lack of capital constraints (availability of large free cash flow) -PepsiCo sells three products through the same distribution channel.
WEAKNESS
-Pepsi hard to inspire vision and direction for large global company. -Not all PepsiCo products bear the company name
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-PepsiCo is far away from leader Coca-cola in the international market-demand is highly elastic.
OPPORTUNITY
-Food division should expand internationally -Non carbonated drinks are the fastest growing part of industry. -There are increasing trend toward healthy foods. -Focus on most important customer trend.
THREATS
-Pepsi is blamed for pesticide residues in their products in one of their most promising and emerging market e.g. in India -Over 50 percent of the company’s sales come from Frito-Lay: this is a threat if the market takes a downturn. -PepsiCo now competes with Cadbury Schweppes,Coca-Cola and Kraft foods which are financially sound.
-Size of company will demand a varied marketing program; Social, cultural, economic, and political and government constraints
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Chapter- 5: Findings
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a) Most of the retailers are not aware of the campaign and who are aware are not aware of the procedure of getting the gift hamper.
b) Most of them are satisfied with the service provided by the companies. The satisfaction level for both of the company is almost equal.
c) The Point of Sales of Pepsi is more than that of Coca- Cola.
d) Both the products are equally available in the market. Their mutual outlets are more than their exclusive markets.
e) The availability of the Visi Cooler of Pepsi is slightly more than that of the Cocacola.
f) The one who know about the campaign mostly came to know about it through company’s personnel.
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g) Most of the consumer prefers to drink Coke over Pepsi and very less consumer drinks both the beverages.
h) The major reason to purchase any of the two product is the taste of the product.
i) Very less consumer know about the promotional campaign of the companies and nobody knows the procedure through which they have to go in order to gain the prize.
j) Among the ones who know most of them came to know about the product through TV/ Radio.
k) Most of the consumers are highly satisfied with both the products.
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Chapter-6: Recommendations
a) Though Pepsi has more POS and Visi Coolers but still it is not able to reach the consumer’s mind. So they should work in reaching the consumers’ mind rather than just trying to create more displays.
b) The sale of both the company is maintained only because of the reputation of the company and their taste. The promotional; strategy though being a very good one has not reached the consumers or retailers. So company should focus in promoting such a manner as to reach the retailers.
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c) The company should promote to the consumers via retailers and give a proper knowledge to retailers about what their offer is all about.
d) The promotional campaign should be such designed as it grabs the attention of the consumers and consumers start thinking about purchasing the product.
e) The company’s personnel should be well informed and well trained as observed there is high default in the company’s personnel as well.
f) Though being a catchy topic the campaign is not as successful as company presumed. So a proper market research all over the Kathmandu should be conducted in order to find out what is the actual reason for its failure.
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Chapter-7: Conclusion
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The major objective of the study was to find out the comparative success of the promotional
campaign of Coke and Pepsi. The survey gives the researcher the scope opportunity to know the market of a FMCG product at a glimpse and provide detail information about PEPSI. During the study I found out that the consumers were not so much interested in the offers but rather just drinking the beverage. If the promotion would not have been there then there would be little decrease in sale but not in the higher amount. This implies that both the companies were not able to boost up their sales through their promotional campaign. They need to come up with such an idea which can actually seek the attention of the consumers and make them drink it. The objective of the campaign is not only to retain the customers but to attract new ones too but here we observed that the regular drinkers were drinking the product but it was not successful in gaining the new ones. So the company should seriously work on its promotion.
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Chapter- 8: Appendix Questionnaire
For retailers
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Store Name: Location POS Visi cool : : : a) Coke b) Pepsi c) Own
1) Which company’s product do you keep? i) Pepsi ii) Coke iii) Both
What is the reason for keeping the particular Company? a) Coke
b) Pepsi
2) Which company product do most of the consumers ask for? i) Pepsi ii) Coke iii) Both
3) Are you aware about the promotional strategy of? i) Pepsi ( Drink and Drive) a) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? a) Yes b) No
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How did u come to know about it? a) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
ii) Coke( Let’s get crazy) a) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? b) Yes b) No
How did u come to know about it? b) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
4) Why do consumers buy the product? Is it Because of the offer or just because they feel thirsty? i) Thirsty ii) Offer
5) Which offer is more attractive to you? i) Pepsi ii) Coke
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6) What are the extra benefits that company provides to the retailers? i) Pepsi b) Schemes d) Gift Hampers e) Nothing
a) Discount
ii)
Coke
b) Discount
b) Schemes
d) Gift Hampers
e) Nothing
7) Are you satisfied with the companies’ service? i) Coke a) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
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i) Pepsi a) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
For Consumers
Name: Age: Occupation:
1) Which company’s product do you usually consume? i) Pepsi ii) Coke iii) Both
2) What is the reason for you to choose the particular product? i) Price ii) Service iii) Taste iii) The prizes iv) No particular reason
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3) Are you aware about the promotional strategy of? iii) Pepsi ( Drink and Drive) b) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? c) Yes b) No
How did u come to know about it? c) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
iv) Coke( Let’s get crazy) b) Yes b) No
If yes then do you know the procedure to get the prizes and what the prizes are? d) Yes b) No
How did u come to know about it? d) Print media Consumers b) TV/Radio c) Other retailers d) Company Personnel e)
4) Why do you buy the product because of the offer or just because you feel thirsty? i) Thirsty ii) Offer
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5) Do you actually see what you got in the crown after drinking or simply throw it? i) See it ii) Throw it
6) Are you satisfied with the product? ii) Coke b) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
iii) Pepsi a) Highly satisfied dissatisfaction b) Satisfied c) Neutral d) Not satisfied e) High
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Chapter-9: Bibliography
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WEBSITES: www.pepsi.com www.pepsicoindia,com www.wikipedia.com www.encyclopedia.com BOOKS: Research Methodology- C.R.Kothari Marketing Research- B. S. Bedi Principles of Marketing- P. Kotler & Armstrong
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