In the prolonged marketing battle that began in the '70s and saw the beloved major brands duke it out via celebrity endorsements, rewards promotions Pepsi Stuff, anyone? Fact is, RC has had loyal fans throughout its more than year history. RC also has a presence internationally, in countries such as Estonia, Thailand, and Iceland.
While this second goal may appear to be mainly related to improving their corporate image, it does have commercial intent, as explained on the PepsiCo website: Recent Product Innovations PepsiCo has a history of developing and launching a number of mid-calorie beverages and Pepsi Next is by no means their first attempt with this style of product.
One very successful mid-calorie product initiate is Trop50, which was launched in Pepsi acquired the Gatorade brand with their purchase of the Quaker Company in Hence, they believed that it was the right time to revisit a reduced calorie Pepsi variation.
Not to be confused with the current Pepsi Light brand marketed in various countries, which is a version of Diet Pepsi. According to one of their vice presidents at the time Edward E.
More recently, inPepsiCo released a calorie beverage branded as Pepsi Edge. Both of these brands only lasted around 18 months or so in the market before being withdrawn.
Volumes units have weakened slightly sinceindicating that the market is in late maturity-early decline stage of the product life cycle. Retail dollar sales have been supported somewhat by price increases.
And the soft drink market has also been slightly challenged by sports drinks and energy drinks that have seen a minor increase in market share. Overall, these movements indicate changing tastes of consumers as a result of a stronger health focus.
One of the brands most impacted by these market changes has been the flagship Pepsi brand. Reportedly, Dr Pepper Snapple is pleased with the performance of this new product to date.
Independent to the Pepsi Next offering, Coca-Cola is currently mid-late in the process of test marketing in four American cities mid-calorie versions of their Fanta and Sprite brands. Obviously if these tests are successful and these products are fully rolled-out to the market as a standard product, it appears that there could be a third sub-category of soft drinks; traditional, diet, and now mid-calorie beverages.
It would then be interesting to see how and if this sub-category develops, particularly with more offerings and overall promotional support.
But on the other hand, it might be possible that Coke might be test marketing the mid-calorie Sprite and Fanta options as a form of market research only. Impact of Substitute Products Why it may seem strange that a highly successful company like PepsiCo would frequently come back to a product concept that they had struggled with a number of times, it appears that one of the key drivers has been the slight decline in the US carbonated soft drink CSD market in recent years.
It is estimated that the cola category of the CSD market is reducing by around 90 million cases a year. These consumer purchases have tended to shift to other beverage solutions, such as water, energy drinks and juices.
One of the underlying factors driving this change in behavior has been identified as the preference that some consumers have to reduce sugar. Pepsi Next Strategy, Development and Launch As stated above, a key goal of the Pepsi Next offering is to try and win back cola drinkers lost to other beverages.
For instance, Coke Zero was a very successful new product a sub-brand under the Coke family brandwhich also had the impact of adding excitement to the Coca-Cola product. The firm used a variety of promotional tools, including a series of humorous YouTube videos with pretend and somewhat inept Coke brand managers who were intent on taking legal action against Coke Zero.
Another important aspect to keep in mind for Pepsi Next and its likely financial viability is the overall size of the CSD market. With this in mind, even a fraction of market share in the CSD market is significant. This should deliver good gross margins, as the product would be produced, distributed and marketed using existing infrastructure and facilities.
Of course, while Pepsi has indicated that they are taking a long-term view of the market and this product, these statements may or may not be true. In these types of markets fun food and drinksvariety and new flavors are often used as an effective short-term tactic. For example, chocolate manufacturer Cadbury frequently brings out new products for a limited time only.
It is also a common tactic in the fast food industry. Market Gap Pepsi Next is obviously designed to fill the gap between normal sugar cola drinks and diet colas, trying to appeal to consumers that may sometimes prefer lower-calorie drinks but are concerned with the taste or the social image of diet drinks and vice versa.
That is, will regular consumers of diet colas be tempted to switch and will consumers of regular colas be happy enough with the taste of Pepsi Next to take it up?
That challenge is obviously one reason that Pepsi has included a heavy free sample aspect in their promotional mix. Therefore, there appears to be two main risks associated with targeting this market gap.Introducing the all NEW 2nd Edition of the Practical Marketing Workbook.
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Smartwater represents on of Coca-Cola's biggest bottled-water brands. Smartwater As soda sales fall, Coke and Pepsi are looking to bottled water to boost business.. Bottled-water sales have more. Since its introduction in , Porter’s Five Forces has become the de facto framework for industry analysis.
The five forces measure the competitiveness of the market deriving its attractiveness.
STRATEGIC MANAGEMENT FINAL PAPER PEPSICO CASE STUDY ANALYSIS LECTURER. STRATEGIC MANAGEMENT FINAL PAPER PEPSICO CASE STUDY ANALYSIS LECTURER: Sisdjiatmo K.
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Widhaningrat Composed by Chalinee Kunkaweeprad () Karisma Maharani Anisakusuma () Prasya . Like its main rival, Coca-Cola, RC Cola also started in Georgia, in the town of Columbus.
It was a disagreement with Coca-Cola, in fact, that led a man named Claud Hatcher to develop what would. Due to today's widespread internet access as well as the use of social media more and more consumers are becoming aware of the associated risks with consuming convenient processed foods The market is seeing a shift as more and more consumers are seeking more healthy organic choices CEO Indra Nooyi.