Preface

The beverages sector in India is one of the largest in terms of production,

consumption, export & growth prospects. These are two major sectors in the
beverages industry, i.e. Alcoholic Sector & Non Alcoholic Sector.
The purpose of this project is to find out the factors that affect the choice of
consumers when they purchase soft drinks (Non Alcoholic Beverages), the
brands preferred by the consumers for different flavors & about the
consumption pattern for different soft drinks.
Chapter one includes the introduction of the beverage industry framework of
India beverage industry & explains in detail about the non alcoholic beverage
sector.
Chapter two contains objectives of the research study & the research
methodology used for the project.
Chapter three also includes the analysis & interpretation of the research study.
Chapter four has various finding, conclusion & suggestions.

Executive summary
Soft Drinks Bounces Back
After a somewhat subdued performance in 2006 due to a recurrence of
the pesticides controversy, soft drinks sales bounced back strongly to record
double-digit volume growth in 2007. With carbonates growth back on a positive
upward curve alongside burgeoning sales of fruit/vegetable juice and bottles
water, soft drinks showed impressive growth in 2007. Off-trade volumes grew
slightly faster than on-trade volumes, driven by higher consumption of
packaged and branded soft drinks at home and on the go. The emergence of
supermarkets/hypermarkets, heavy consumer promotions and various new
product launches played a key role in driving off-trade volume growth.

Bottled Water and Fruit/vegetable Juice Continue to be Star Performers

Soft drinks sales in 2007 were propelled by bottled water and
fruit/vegetable juice with their healthier positioning helping to drive sales of soft
drinks. While carbonates posted single-digit growth in 2007, rebounding from
the pesticides controversy of 2006, it was bottled water and fruit/vegetable juice
that stormed ahead with high double-digit growth rates. Poor municipal
infrastructure for tap water has pushed sales of bulk packaged water to
households. Fruit/vegetable juice is growing as a result of increased consumer
expenditure on naturally healthy (NH) beverages. While functional drinks and
RTD tea also posted impressive growth in 2007, they were growing from a very
small base and are yet to achieve a critical mass in terms of establishing a loyal
consumer base.
Coca-Cola India and PepsiCo India slip in shares
With consumers showing a growing preference for healthier soft drinks
such as bottled water and fruit/vegetable juice rather than carbonates in 2007,
the two carbonates giants suffered a marginal decline in share. Although both
2

players embarked on a change in strategy to focus more on non-carbonated

soft drinks in their portfolios, they were unable to maintain share and lost out
slightly too home-grown players Parle Bisleri and Dabur India. Coca-Cola India
launched Minute Maid and pushed the sales of its juices while PepsiCo India
heavily promoted Tropicana, Aquafina and Gatorade during 2007. In addition,
Coca-Cola India and PepsiCo India embarked on re-branding themselves as
total beverage players and not just carbonates players.

Booming Modern Retail Brings Many Opportunities for Soft Drinks

Players
With the retail scene in India undergoing a rapid metamorphosis with the
establishment of supermarkets/ hypermarkets and convenience stores, soft
drinks sales have benefited positively. People in urban areas are increasingly
flocking to supermarkets to pick up specialty items that are not available in the
kirana stores that are found all over India. Modern retail outlets have provided
soft drinks players with many opportunities to push their brands. Consumer
promotions for fruit/vegetable juice and emerging sectors such as RTD tea and
functional drinks are driving product sampling. Attractive point-of-sale (PoS)
displays and gift packs of concentrates are also drawing consumer attention in
supermarkets/hypermarkets.

Healthy Drinks to Drive Forecast Growth

Soft drinks is expected to post a strong performance on the back of
increasing affluence amongst consumers and evolving lifestyles which lead to
consumers devoting less time to preparing fresh food and drink at home.
Competition from the unorganized sector will diminish gradually as consumers
show greater aversion to buying unpackaged and unbranded soft drinks from
street vendors due

to health and hygiene

concerns. Rising health

consciousness is also expected to drive sales of naturally healthy (NH) soft

3

drinks such as 100% juice and mineral water. In addition, soft drinks such as
sports drinks and juice-based carbonates are also expected to fare well over
the forecast period as consumers perceive them to be healthy.

Beverage Industry
EMERGING BEVERAGE TRENDS
The beverage industry is a shifting landscape as volume leading categories
such as soft drinks and beer continue to

experience share erosion while

functional and health & wellness oriented categories enjoy double-digit volume
growth:

Soft Drinks

-3.9%

Domestic Beer

-1.2%

Energy Drinks

+53%

Bottled Water

+25%

RTD Tea

Sports Drinks

+23%
+19%

PROJECT BACKGROUND
BEVERAGE MARKET

The Indian Beverage Market

Indias one billion people, growing middle class, and low per capita
consumption of soft drinks made it a highly contested prize in the global CSD
market in the early twenty-first century. Ten percent of the countrys population
lived in urban areas or large cities and drank ten bottles of soda per year while
the vast remainder lived in rural an eras, villages, and small towns where
annual per capita consumption were less than four bottles. Coke and Pepsi
dominated the market and together had a consolidated market share above
95%. While soft drinks were once considered products only for the affluent, by
2003 91% of sales were made to the lower, middle and upper middle classes.
Soft drink sales in India grew 76% between 1998 and 2002, from 5,670 million
bottles to over 10,000 million and were expected to grow at least 10% per year
through 2012.2 8 In spite of this growth, annual per capita consumption was
only 6 bottles versus 17 in Pakistan, 73 in Thailand, 173 in the Philippines and
800 in the United States.
With its large population and low consumption, the rural market
represented a significant opportunity for penetration and a critical battleground
for market dominance. In 2001, Coca-Cola recognized that to compete with
traditional refreshments including lemon water, green coconut water, fruit juices,
tea, and lassi, competitive pricing was essential. In response, Coke launched a
smaller bottle priced at almost 50% of the traditional package.

INDIAN HISTORY
India is home to one of the most ancient cultures in the world
dating back over 5000 years. At the beginning of the twenty-first century,
twenty-six different languages were spoken across India, 30% of the
population knew English, and greater than 40% were illiterate. At this time, the
6

nation was in the midst of great transition and the dichotomy between the old
India and the new was stark. Remnants of the caste system existed alongside
the worlds top engineering schools and growing metropolises as the
historically agricultural economy shifted into the services sector. In the
process, India had created the worlds largest middle class, second only to
China.

A British colony since 1769 when the East India Company gained control
of all European trade in the nation, India gained its independence in 1947
under Mahatma Ghandi and his principles of non-violence and self-reliance. In
the decades that followed, self-reliance was taken to the extreme as many
Indians believed that economic independence was necessary to be truly
independent. As a result, the economy was increasingly regulated and many
sectors were restricted to the public sector. This movement reached its peak in
1977 when the Janta party government came to power and Coca-Cola was
thrown out of the country. In 1991, the first generation of economic reforms
was introduced and liberalization began.

STORY OF SOFT DRINKS

The Soft drinks can be segmented on the basis of point of
purchase or on the basis of type of products. The story of soft drinks is
fascinating, since the beginning of life the most pressing needs of all living
beings is food & sweet juice when cut open, ditto the watermelon & fresh
coconuts. Man Learnt the Secrets of these Sources &used them as additional
pleasant aid drinks beside water. As year passed in thousands, man tried to
imitate nature in preparing these drinks so as to use them as well. As a result of
laborious Search in 1772, Joseph priestly combined carbon dioxide with water
& artificially produced arched water bubbling with gas spread quickly &
artificially produced arched water bubbling with gas spread quickly & parched
mouth begin to consume this.
7

The Segmentation on the basis of point of purchase divides the market

into two parts on premise 80% of the Consumption of Soft drinks is done
Premise i.e. restaurants, railway station, cinema hall etc.
At Home:
The rest of 20% of the market compromises of the soft drinks purchased
for consumption at home. The market can also be segmented on the basis of
products. The segment could be as follows
This account for 62% of the total soft drinks at all India level. The
brands that fall in this category are Pepsi, Thums up, Coke. Non-Cola segment,
which can be further, divided as orange. This segment has 19%share of the
total market. Mirinda orange (of Pepsi) Fanta & and Gold Spot (Both of Coke) &
crush represent the orange segment.
Lime:
This segment represents 14% of the total market. Cokes Limca
&Pepsis Mirinda fall in this category.The market leader is close to 70% market
share of this segment but sprite has considerably cut into this market. Mango,
Slice Mangola & Maza is the leading Mango drink. Mango Drinks account for
about 3% of the soft drinks market. There is very thin line of difference between
the clear & cloudy lime. The most obvious feature is that clear lime has to be
bottled in green bottles as sunlight harms the drinks & change the taste.

THE INDIAN SOFT-DRINK INDUSTRY SCENARIO

Domestic firms in India, which once enjoyed the benefits of
sheltered markets, are increasingly facing competition from global giants in
1990s. Sheltered market had once allowed Indian entrepreneurs to develop
strong brands that have held there own against the onslaught of the
multinational companies. Some domestic firms have chosen the strategy of tieups with MNCs. Others have tried to meet the competition head on.

Whatever route Indian firms take to deal with competition from MNCs it is
imperative for them to keep track of global strategies of these firms. Often the
strategies undertaken at the local level are only part of the global strategies,
because it is difficult for any firm to allow significant differences in approach in
different markets.
Coca-Cola controlled the Indian market until 1977, when the
Janta Party beat the Congress party of then Prime Minister Indira Gandhi. To
punish Coca Colas principal bottler, a Congress party stalwart and long time
Gandhi supporter, the Janta government demanded that Coca Cola transferred
its syrup formula to an Indian subsidiary. Coca Cola backed and withdrew from
the country.
India now left without both Coca Cola and Pepsi became a
protected market. After Coca Cola made its exit from Indian market in1977,
there was a vacuum in the soft drink market, advantage was taken by Parle and
Pure drinks. Parley launched Thumps Up and gained a substantial and robust
market share.
In 1977 with a change in the government at the centre led to the
exit of coke, which preferred to quit rather than dilute its equity to 40% in
compliance with the provisions of FERA, the first national cola drink to emerge
was Double Seven.

In the mean time, Pure Dinks, Delhi, on Cokes exit

switched over to Campa Cola, and, by the end of 1970s, Campa Cola was
practically alone in the Cola market.
Parle introduced Thumps Up in the beginning of 1980s,
followed by thrill by McDowells and Double Cola by Double Cola manufacturing
Company (DCMC)-an NRI-run outfit with its plant at Nasik. An additional
dimension to the Indian soft drink industry was that of fruit drinks, which were
valued at Rs. 40 Crores and among the brands in the market, the leader was
Parles Fruity with about 40% of the market share. The other players in this
segment who have posed challenges to Parle are Godreg(with Jumpin) and
Ahemdabad bases Pioma Industries Rasna Cola-Cola.Setup in 1949, by 1978,
9

Parle led the Indian soft drinks market with a share of 33%. Gold Spot and
Limca were the clear winners, and later, Thumps Up also started contributing to
its growth. Thus, Parley touched a market share of around 60% in 1990.
However, with the arrival of Pepsi, Parles share decreased to 53% and Pepsi
quickly attained a market share of about 20 percent.
Till 1990, Parles chief rival was Pure Drinks, which was
steadily losing out to Parley. After the arrival of Pepsi, the market share of Pure
Drinks further deteriorated. This was mostly because Pure Drinks had smaller
number of bottling plants and a limited distribution network exactly the same
reason why Pepsi could not do much against Parle. Parle had 60 bottlers
against Pepsis 20 and 2.1 lakh retailers against Pepsis 1.5 Lakh.
Before 1992 , the Indian soft drink industry had not grown fast
mostly due to high excise duties and government encouragement of fruit drinks
over carbonated drinks. The Limca was largest selling brand of bottled soft
drinks in India, from consumers point of view Cola was the most popular flavor.
It accounted for about 40 percent of the market. Lime and Lemon drinks
followed with about 30 percent, and Orange drinks had only about 20 percent
of the market share. Carbonated soft drinks accounted for the rest 10 percent.
From 1984 to 1992, the Rs, 1,200 Crore Indian soft drink industry grew at an
average of 2.5 to 3 percent, the highest being 12.4 percent during 1984-1985.
Pepsi had begun its efforts in mid 1980s but only in 1990 it
was able to make an entry in the Indian Cola market. In early 1985, the then
government rejected a proposal with RPG GROUP. This involved the export of
fruit juice concentrate from Punjab in return for the import of Cola concentrate.
The deal offered was a 3:1 EXIM ratio.
The revised proposal made by Pepsi also met lots of
resistance. The strongest opposition to the proposal came from the food and
civil supplies ministry, which argued that India should be promoting fruit juices,
not carbonated soft drinks. Opposition also came from CSIR, one of whose
laboratories developed its own soft drink flavors. After more than 5 years of
10

acrimonious battles Pepsi was finally launched in India in June 1990. To obtain
the license for India, Pepsi had to export $5 of locally made products for every
$1 of materials imported, and it had to agree to help the Indian government to
initiate a second agricultural revolution. Pepsi has also had to take on Indian
partners. Pepsi Co, Punjab Agro Industries Co-Operation (PAIC) and Voltas
promoted the project.
Pepsi had a very significant first mover advantage in the
Indian market. It did not have the condition of divestment of 49 per cent equity
in downstream ventures attached to it when it received permission to invest in
India. Pepsi had obtained the government approval for its downstream ventures
prior to the FD1 guidelines that made Indian equity holding mandatory. Thus, in
its original clearance, Pepsi was not only allowed to hold 100 per cent equity .in
its holding company but was also allowed to carry out bottling and marketing
operations.
The government approval, moreover, had
allowed Pepsi to earn* out acquisition of assets to expand its business in
the country. Pepsi used this clause in its approval to buy out 100 per cent
stake in some of the domestic bottling companies including its high profile
buyout of Gujarat Bottling Company, the former Coke franchisee in
Ahmedabad. (Industry ministry sources have clarified that while Pepsi would
be required to seek fresh government approval if it picks up shares in
domestic bottling companies as part of its portfolio investment, it does not
need such approval if the assets are acquired for expansion.)
There was now a triangular battle between Parle,
Pepsi and Pure Drinks. Pepsi launched 250 ml bottles in June 1990 to
capture the 250 ml bottle-market of Thums Up (launched in November
1989). As a response, Thums Up ran ads downgrading Pepsi's taste and
declared that it was a fast drink. Thums Up entered the brand war totally with
blind taste test ads.

11

Thums Up launched Double Maha Cola, the 500 ml

bottle, to prove that bigger is better in cola wars and was again first to
introduce 'takeaway' 250 ml bottles for the first time in the Indian cola market.
Pepsi got into more trouble when six months after its launch it caught
government's attention regarding its commitments. Soon after, a show cause
notice was issued to the company for prima facie violation of the conditions
stipulated in the letter of intent with regard to the production of soft drink
concentrate.
Coca Cola came back to India after 16 years when it
was launched on October 24, 1993, at Agra. Coca-Cola was initially wooed
by the Godrej group, Great Eastern Shipping and the Britannia Industries Ltd,
led by Rajan Pillai. In March 1991, it signed an MOU (Memorandum of
Understanding) with BIL and this proposal was accepted by the Chandrasekhar
government. But relationship between the two companies turned sour over the
export-oriented clause and finally on June 23, 1993, Coca Cola got the
permission to enter the country with a 100 per cent unit in India. On
September 22. 1993, the company bought out the Parle brands.
After the second coming, of the international varieties of Cola drinks,
the market has witnessed a high-profile tussle between the global giants Coca-Cola and PepsiCo. This tussle and the respective problems faced by the
two firms in the Indian market are extremely instinctive. PepsiCo gained a
significant first-mover advantage through its ability to gain early access to
the market. Coke, after a couple of abortive attempts, seemed to have made
an entry under ideal conditions in the market. However, it then faced
dissensions within the ranks of its bottlers. Its manner of dealing with the
bottlers seemed to lack Pepsi's finesse and India seemed to be one of the
rare markets where Pepsi was holding its own against Coke and
consolidating its position.

12

The companies have continued to wage their war in India. Coke, with
the strategic move of buying out Parle, gained a huge market share
overnight. Hut Pepsi is sparing no efforts to gain a larger share of the
market. The potential in the Indian market is tremendous. The Indian market
is roughly more than Rs 1,200 crore; moreover, the per capita consumption
of three bottles in India is lagging way behind the US's astounding 700
bottles per capita consumption.

Both Coke and Pepsi have rightly realized that the immediate priority is in
expanding the market by increasing the growth rates. The Indian market
averaged a growth rate of 2.5 per cent between the years 1984-92. From
1992, when the Cola war took a serious turn, the growth rate has almost
doubled. In 1995 the market grew by 20 per cent in volume term, with
estimated sales of 140 million cases (one case :- 24 bottles of 300 ml each)
up from 115 million cases in 1994.
The industry, prior to 1990, was witnessing sluggish growth rates
(CAGR: around 5 per cent) with two domestic players: Parle and Pure
Drinks. The entry of the cola giants, Coke and Pepsi, led to a rapid
expansion in the size of the market (CAGR for the first half of the 1990s:
around 20 per cent). Coke's acquisition of Parle has turned the market into
a duopoly. Also not only the market size is increasing, there is also a
shift of consumer preference between the different soft drink segments.
Whereas in 1990, cola was accounting for a third of all soft drinks sold, today
it accounts for well over a half.

13

COMPANY PROFILE

14

COMPANY PROFILE
In 1902 the Pepsi Cola Company was launched in the back room of
pharmacy and was applied in patent office for a trademark. The business
begins to grow on June 16, 1903 Pepsi Cola was officially registered with the
US patent office. That year Cola sold 7,968 gallons of syrup using them in
exhilarating aids digestion. It also awarded for franchised to bottle Pepsi to
independent investors, where number grew from just two in 1905 in cities of
charlotte and Durham, to 15 the following year, and 40 by 1907.
Gold Spot is considered as the first branded soft drink in India. It was
introduced by Parle in early forties. Coca-Cola was the first foreign soft drink to
be introduced in Indian markets. The Coca-Cola Company entered India in the
early fifties, when four bottling plants were setup at Bombay, Calcutta, Delhi
and Kanpur. Coca-Cola enjoyed a good beginning and dominated the market.
Parle exports private Ltd. the major domestic player later in 1970 introduced
Limca, a lemon soft drink.

Before Limca introduction, they had attentively

introduced Cola Pepino which was soon with from the market.
In July 1977 Coca Cola left India following a public dispute over share holding
structure and import permits. As per FERA regulations the company was
required to indicate or clear operation. Coca-Cola left a big gap, which was
filled by several companies who came forward pushing different brands in
market.
Parle products introduced their cola Thums Up; pure drinks introduced
Campa Cola along with orange and lemon. Modern Bakeries introduced
Double Seven Thrill Rush and Aprint. At the same time various regional
soft brands played an independent role in their respective territories like Duke
and Mangola etc.
After Coke was asked to leave India Pepsi began to lay plans to enter this huge
market. Pepsi worked with an Indian business group in seeking govt. approval
for its entry over the objections of both domestic soft drink companies and anti15

multinational legislators, Pepsi saw the solution to lie in making an offer that
Indian Govt. would find hard to refuse. Pepsi offered to help India export some
of its agricultural products in a volume that would cover more than the cost of
importing soft drink concentrate. Pepsi also promised to focus considerable
selling efforts on rural areas to help their economic development. Pepsi further
offered to transfer food processing packaging and water treatment to India in
the way Pepsi started its operations in April 1989 for beverages, snack food
and export business. In 1990 first Pepsi, Cola was produced in India.
PepsiCo entered India in 1989 and in the span of a little more than a
decade, has grown to become the country's largest selling soft drinks company.
The Company has invested heavily in India making it one of the largest
multinational investors. The group has built an expansive beverage, snack food
and exports business and to support the operations are the group's 39 bottling
plants in India, of which 17 are company owned and 22 are franchisee owned.
PepsiCo stays committed to providing its consumers with top quality
beverages. Its diverse portfolio of brands include the flagship cola brand Pepsi; Diet Pepsi; 7Up; Mirinda; Mountain Dew; Slice fruit drink; Tropicana
brand 100% fruit juices in various flavors; Aquafina packaged drinking water;
Gatorade plus local brands Lehar Evervess Soda, Dukes Lemonade and
Mangola.
PepsiCo is one of the largest MNC exporters in India and its export
business consist of three categories - agri business, commodities and Pepsi
system sales. PepsiCo has made significant investments with the Punjab
Agriculture

University

to

develop

comprehensive

agro-technology

Programmed that has helped thousands of farmers across India improve the
yield of their farms and the quality of their agricultural products. PepsiCo has
leveraged its knowledge in contract farming to develop seaweed cultivation in
Tamil Nadu and has partnered with the Government of Punjab to help farmers
of the state through the utilization of developed technology for citrus farming.
16

PepsiCo India has worked closely with the Defense forces in

rehabilitation of Defense Personnel through projects like Mission Vijay-2. Under
this project Pepsi in association with Castrol helped soldiers set booths in rural
area to sell Pepsi and Castrol products there by helping them to not only earn a
decent living but to also add some color to their lives. Through this project
PepsiCo India also tries to give these soldiers distribution rights for its soft
drinks.
In the next year, 1991 production on Mirinda and 7 up started.
The production of Slice, Teem and Fountain Pepsi started in 1993 Coca-Cola
came back again in October 1993 and launched in Agra. It joined hands with
Parle Export Pvt. Ltd. to enter India and gradually took over the same company.
The nineties also saw a new foreign entrant called Cadbury Schmeppes, which
rolled out Canada Dry and Crush in Metropolitan cities.

Pepsi entered the cloudy lemon category by launching its Mirinda Lemon
in 1998. In may 1999, a notification, presenting the presentation of food
Adulteration (Fourth Amendment) rules 1999, allowed the use of the blended
artificial sweeteners, as part time and a successful fame potassium in the
formulation of soft drinks, which in what made the entry of diet Pepsi and diet
coke. Coca-Cola also rolled out its popular clear lemon drink sprit in India at
same year, 1999.

Whats in Pepsi?
Pepsi contains:
Carbonated water, High fructose Glucose syrup/or Sugar color, Phosphoric acid,
Caffeine, Citric acid and natural flavors.

17

Calories

100

Total Fat (gm)

Sodium (mg)

25

Potassium (mg)

10

Total Carbohydrates (gm)

27

Sugars (gm)

27

Protein (gm)

Caffeine (mg)

25

PEPSICO HEAD QUARTERS

Pepsi co India world head Quarters is located in Purchase, N.Y.
approximately 45 minutes from New York City. Edward Darrel Stone, One of
Americas foremost architects, designed the seven-building headquarters
complex that includes the Donald M.Kendall Sculpture collection in a garden
setting.
The collection of works is focused on twentieth century & features work
by masters such as Auguste Rodin, Henri Laurens, Henry Moore, Alexander
Calder, Alberto Giacometti, Arnaldo Pamodoro & Claes Oldenburg.

COMPANYS GLOBAL STRATEGY

Set a winner growth goals if you act like number two, you will always be
number two.
Hiring people who love change and thrive on risk taking.
Upset the rules of the market place. .
Always anticipate the response you may provoke.
Execution of a plan often derive success more then more marketing
Encourage Executives to think laterally.
18

 Conjure Up those creative tactics to knack fizz out of its competition.

PEPSICO MISSION
We dedicate our efforts to In India, only 40% people drinks soft drinks. So the main mission of
Pepsi is to capture the Rural Markets to make it a one-man show.
Hiring & training People who single handedly drive the business
forward.
Providing courteous, prompt & efficient service to our customer.
Building long-term prosperity of our brands in the market place.
Exploring & developing opportunities that helps in building competitive
edges.
MARKET SIZE AND GROWTH RATE
The particular feature of market is that of positioning & targeting of various
brands while cola brand of Coke is targeted at teenagers & is positioned as
refreshment for mind & body. The Thums up brand is targeted at people in age
group & is positioned as fun drink.
Soft Drink market size for Fy00 was around 270mm cases (6480ml
bottle). The market, which was witnessing 5-6% growth in the early 1905 &
even slower growth at around 2-3% in the late 80s. Presently the market growth
has slowed down with growth rate of 7-8 per annum dawn with growth rate of 78% per annum compared to 22% growth rate in the previous year. The market
size for Fy01 is expected to be 7000mmbottles. The market growth of 22% till
last year target still due to high excise duty of 40% leading to higher price of the
end product. In terms of SKUS the market is Skewed towards 300ml which
constitutes around 80-85% of the market rest in the form of other pack, Size,
But with increasing occasion led & home refrigeration led consumption the
19

sales of bigger SKUs like more than 1 liter pack size has increased this has led
to increase contribution from pet bottles sales up to 75% are in Urban areas.

BRAND PROFILE
PepsiCo Company provides five brands of Soft drinks. In all brands of Pepsi
one is Soda, Second Mineral water and other are running successfully in the
market. At present time Pepsi provides two new soft drinks. Dew Mountain and
Blue Pepsi and above marketed with reasonably good success.
1. Blue Pepsi
2. Pepsi Diet
3. Miranda (Lemon + Mango)
4. Slice
5. 7up
6. Aquafina
7. Dew Mountain
Now here we will discuss about the market shares of each brands of soft
drinks. There market share are as followsSoft Drinks

Market Share

Pepsi

57%

Mirinda (Orange)

16%

Mirinda (Lemon)

2%

Slice

1.5%

Teem Soda

Not Available

7UP

1.5%

Aquafina

3%

Blue Pepsi

2%

Dew Mountain

8%

Pepsi Diet

6%

Quantity Details of all brands of Soft drinks are given as below

20

SOFT DRINKS
Pepsi
Mirinda Orange
Mirinda Lemon
Slice
7up
Teem Soda
Pepsi Diet
Aquafina
Dew mountain
Blue Pepsi

Quantity
200ml, 300ml, 600ml, 1lt, 2lt.
200ml, 300ml, 600ml, 1lt, 2lt
200ml, 300ml, 600ml, 1lt, 2lt
250ml, 500ml
200ml, 300ml, 2lt
300ml, 600ml
330ml, 500ml
1lt
200ml
500ml

PEPSI DISTRIBUTION CHANNEL

Pepsi's main strategy is to operate franchisee (Franchisees owned

Bottling operation). Pepsi indulges mainly in direct contribution lo retailer and
resorts to indirect in certain areas. Pepsi distributes through three channels
which is shown below:

21

PEPSI BOTTLING PLANT

WAREHOUSE
FRANCHISEE DEALERS
RETAILERS

CONVENTIONAL
RETAILERS

NON-CONVENTIONAL
RETAILERS

There is no involvement of wholesalers in the distribution of products. It is more

like an agent network. The companies have divided the country into various
regions and established a franchisee in each region. The franchisees have their
own bottling plants and manage all the day to day operations.
PACKAGING
Packaging plays a vital role in increasing decreasing in the sales of the
products. Thus, packaging of the product should be attractive and product
should be available in different sizes.

To keep in mind the importance of packaging PepsiCo

and Coca cola is adopting new technology for looking the products
attractive and producing the product in different size. The different
pack sizes available are 200 ml, 300 ml, 330 ml (Can), 600 ml
(promotional pack with 100 ml extra), I liters., 1.5 liters., 2 liters.,
and 200 ml / 250 ml (slice).
22

RANGES OF DIFFERENT PACK AVAILABLE

1. GLASS 200 ml, 300 ml, 1 liter and 250 ml.
2. PET

- 500 ml, 600 ml, 1 liter and 2 liter.

3. TETRA - 200 ml (SLICE)

4. CANS - 330 ml
IN GLASS

24 Bottles * 200 ml = 1 Case

24 Bottles * 250 ml = 1 Case

24 Bottles * 300 ml = 1 Case

6 Bottles * 1000 ml = 1 Case

IN PET

24 Bottles * 500/600 ml = 1 cartoons

12 Bottles * 1000 ml

9 Bottles * 2000 ml

12 Bottles * 1500 ml

= 1 cartoons
= 1 cartoons
= 1 cartoons

TETRA

24 Bottles * 200 ml = 1 Case

CANS

24 cans * 330 ml = 1 Case

ADVERTISING STRATEGIES ADOPTED BY AERATED SOFT DRINK

INDUSTRY
Soft drinks is perhaps the most hard fought product categories in India in
every

respect

media,

events,

distribution,

pricing,

communication,

endorsements and so on... Every year it consistently emerges as one of the top
23

10 categories on television. We, at AdEx India, have looked at year 2003 to

understand the year that was for this exceptionally competitive segment!
One clear and predictable pattern in 2003 was the two clear peaks of ad
spend - one during the world cup and the other during the festive time.
Interestingly, while Pepsi dominated media budgets during World Cup, CocaCola seems to have been the dominant spender in the month of September.
This paper tries to throw some light on the following aspects:

Genre wise and channel wise composition of advertising on TV

Advertising strategy adopted by the aerated soft drink players on TV and

press

Zone wise and genre wise advertising on press

Specific case: zone wise and genre wise advertising for Pepsi and Coke

Genre wise analysis on aerated drinks establishes that this category is

heavily advertised on feature films, music, cricket and soaps. Major part of the
advertising on Cricket can be attributed to the fact that Pepsi was the official
sponsor of the Cricket World Cup 2003. However, apart from cricket Pepsi is
actively present on other types of sports such as soccer, wrestling etc.
FIGHT FOR THE MARKET SHARES
With the cola majors busy sharpening their arsenal, it's a pitched
battle all the way -- whether on television or in the marketplace. '
According to figures released by IMRB, in the month of January-February, the combined market share of all carbonated soft drinks (CSD)
beverages under PepsiCo's domestic product portfolio - including Pepsi,
Mirinda Orange, Mirinda Lemon and 7 Up -- stands at 48.3 per cent. The IMRB
data adds that with the exception of Mirinda Lemon, all PepsiCo beverages
24

have led over Coca-Cola's brands in terms of market share in this period.

However, when contacted by Business Line, Coca-Cola's official

spokesperson disagreed with these figures. According to ORG-MARG, which
tracks market figures for Coca-Cola India, the combined market share of all
Coca-Cola brands put together stands at 58 per cent. While declining to provide
individual market share of brands under the company's portfolio, Coca Cola
India's official spokesperson sa1d, "We do not agree with the figures given by
PepsiCo. If our turnover last year was almost double theirs, how can their
market shares be higher? The market shares they are stating are obviously
questionable."

Pepsi's official spokesperson reiterated that among colas, which occupy

close to 70 per cent of the approximately 270-millioncases CSD market, Brand
Pepsi's market share stands at 51 per cent. The combined market shares of
Coca-Cola and Thums Up stands at 49 per cent, according to IMRB.
In the carbonated orange segment, which accounts for roughly 15 per
cent of the overall CSD market, the market share for Mirinda Orange has been
estimated at 53' per cent by IMRB. The market share of Coca-Cola's Fanta
brand is estimated at 47 per cent.
In the cloudy lemon segment, which accounts for roughly 10 per cent of
the CSD market, Coca-Cola's Limca brand leads PepsiCo's Mirinda Lemon by
a huge margin. Limca has a 75 per cent size of this segment, while the share of
Mirinda Lemon is 25 per cent. According to industry estimates; the share of the
cloudy lemon segment has slipped below that of the orange segment.

25

PEPSICO: SOON TO HIT $ 1-BILLION MARK IN INDIA

PepsiCo will soon join the elite band of companies with $l-billion
sales in India. The company currently has sales of $700 million. Since 1989 the
$27 -billion food and beverages giant has invested $700 million in India and
seen a steady double-digit growth in its volumes. "We are on track to make it
the second or third largest," Steve Reinemund, chairman & CEO PepsiCo told
the media in New Delhi. Reinemund's visit was preceded by that of E Neville
Isdell, chairman of the board and CEO of The Coca Cola Company, who chose
to visit India on taking charge of Coke's global operations a few months ago.
Reinemund said PepsiCo's Rs5-per-packaffor_bility strategy initiated by
Coke and Pepsi had worked well in India and helped the company increase its
consumer base from 150 million to 250 million. He said with the strategy
PepsiCo had attained critical mass. "It is time now to increase the depth of
consumption," he says.
However, he admitted that the company was forced to hike its prices
recently as there was an affordability challenge all over the world. "We have
learnt this lesson and reverted to higher price points (in India) after having
achieved our objective of 150 million consumer footprints.
Pepsi Co is now making operating profits in India and its exports are
worth over $60 million, up from just $3 million in 1991. Reinemund was
especially upbeat about the company's snacks business Frito Lay, in India,
which he said was the fastest growing segment for five consecutive years.
"India is clearly one of our priority markets," he said.
The company had no plans to make any structural changes
in India said Reinemund, since of the 37 bottling plants in the country, 17
26

company-owned bottling plants accounted for 55 per cent of total production.

He dismissed reports that arch rival Coke was closing in on the sales of Pepsi
products and said Pepsi's leadership position was because Indians loved its
products. Reinemund met finance minister P Chidambaram and planning
commission deputy chairman Montek Singh Ahluwalia later in the day.
Sources said Reinemund was likely to discuss issues of future
investments and the high taxation policy of the government towards the soft
drinks industry and the overall fiscal environment with Chidambaram and other
senior government officials. Coca-Cola and PepsiCo have been urging the
government for lowering taxes, specially the special excise duty of eight per
cent levied on carbonated soft drinks.
This is Reinemund's first visit to India and signifies the increasing
importance of Indian operations for PepsiCo. India is now among the top eight
businesses of PepsiCo worldwide in terms of beverage and snack sales and
second only to China within Asia.
ADVERTISING AND PUBLICITY
PepsiCo is one of the biggest end spenders in India. It is also one of the
biggest global end spenders. It has a long list of endorsers from pop star
Ricky Martin to film star Sharukh Khan, Karina Kapoor, Pritey Jienta, Saif Ali
Khan, Fardin Khan and Amitabh Bachchan. Hindustan Thompson
Associates, the big guest advertising agency of India has the account of
PepsiCo, is known for its broad cast advertising but it also spends a lot in
non broad cast advertising i.e. hoarding, banners, poster, stickers,
specialties, hanger, dealer board, glow signboard, wall paintings and news
paper, the expenses of these type of advertising are made at territory or unit
level. Allahabad territory has assigned two local advertising agencies R. D.
Associates and Krishna for its territorial advertising.
27

Pepsi's Products

28

29

COOLING FACILITIES AT OUTLET

The company has distributed 3,000 cooling approach at the outlet. The
company has purchased these coolers from six different companies out of
which few also provide maintained services. The companies are Alywn, Carrier,
Kelvinator, Konark & Helchama.
In India 80% soft drink is consumed at the outlets &the rest 20% is
consumed at homes, this requires the soft drink manufacturer to provide
adequate cooling facilities at the outlets to make the soft drinks, ready to serve
to the consumer. Pepsi Company wants to serve its customers with finished
products. The company supplies final product to the retailers & it is retail outlet
where the product is transformed into finished product. While serving the chilled
soft drinks to customer, so the chilled Pepsi available at the retail outlets is the
finished product.

30

The company has also installed deep freezers models of 100lt, 250lt
&1000lt. This cooling equipment is the property of the company, which are
installed at outlets to serve the customer. They are in stalled at those outlets,
which have a deposit of 12 crates of empties upon each 10 liter capacity of the
order & a potential of selling four carats annually on each Liter capacity of the
cooler. The retailers are required to keep only PepsiCo product in these
coolers.
The capacity of coolers varies from 65 liters to 330 liters. Most of the
models have a transparent door, which makes the product visible. These
models are called VISI coolers.
MARKETING SCHEMES
1. Free Flavors, To Retailers:
Company offers few bottle flavors free to retailers on purchase of one
carat of flavor on some specific days. The free flavors scheme varies from one
bottle to many bottles.
2. Display Rack Scheme:
This scheme is only for retailers. In this scheme company provides a
Pepsi rack to retailer. The rack is filled with different bottles of Pepsi. The
retailers are instructed that if they will maintain their racks in the same condition
as it was when it was purchased. After completion of one-month different gift
packs are distributed to the retailers.
3. Hai Koi Jawab:
This scheme was launched on 300ml bottle of Pepsi. This is U.T.C.
scheme meaning Under the Crown. In this scheme some number are given
under the bottle of Pepsi and company announces some lucky number. If this
31

number is matched with the number under the crown number then the owner of
that bottle wins different cash prizes.
4. Miranda U.T.C:
This scheme was launched on 300ml bottle of Miranda. This is U.T.C.
Scheme meaning under the crown. In this scheme some dollar amount is given
under the bottle and the consumer may collect these dollars and add it.
Company provided different gift packs on different crown number.
Their schemes are offered by the company to maintain the competition at it is
offered on those days when Coca-Cola offers any similar scheme.
4 PS
4 Ps is the main features that directly affect the organization without 4
Ps organization is not able to produce the product. 4 Ps represent the main
features of product. Many possibilities can be collected into four groups of
Variables know as Four Ps i.e. product, price, place, promotion.
Product: Product means the good and service combination of the company
offered to the target market. Company changes the sizes, variety, flavor brand
name of the product after one or two year.
Price: Price is the amount of money which customers have to pay to obtain the
product calculates suggested retails prices that its dealers might charge for
sources. But dealers rarely charge the full sticker price.
Place: They are mostly available in al place but easily available in the Urban
Market but not frequently found in Rural Market.

32

Promotion: Promotion means activities that communicate the merit of the product
and persuade target customers to buy it. The measurement factor to promote
the Pepsi product is to increase good transportation in rural market. If the Pepsi
is available to capture the rural market then it is certain that it will occupy first
position of soft drinks industry.

Product

Price

Product Variety
Quality Sizes
Features Services
Brand Name
Warranties
Packaging- Returns

List Price
Discounts
Allowances
Payment Period
Creditors

Target
Customers
Intended
Positional

Place

Advertising
Personal Setting
Sales Promotion
Public Relations

Promotion

Channels
Coverage
Assortments
Locations Logistic
Inventory
Transportation

33

The Coca-Cola Company

One Coca-Cola Plaza
Atlanta, GA 30313
Phone: 404-676-2121
Fax: 404-515-5997
Web Site: http://www.cocacola.com/

DETAILS
Dow Jones Composite
Dow Industrials
S&P 100
S&P 500
S&P 1500 Super Comp
Consumer Goods
Beverages - Soft Drinks
92,400

Index Membership:

Sector:
Industry:
Employees (last reported count):

OFFICERS
Pay
Mr. Muhtar Kent ,
58 Chief Exec. Officer, Pres, Director and Member of
Exec. Committee
Mr. Gary P. Fayard ,

$ 5.60M

Exercised
$0

$ 1.83M

$0

52 Chief Admin. Officer, Exec. VP, Pres of Africa

Group and Chief Operating Officer of Africa Group
Mr. Jos Octavio Reyes ,

$ 1.59M

$0

56 Pres of Latin America and Chief Operating Officer

of Latin America
Mr. Irial Finan ,

$ 1.86M

$0

56 Chief Financial Officers and Exec. VP

Mr. Alexander B. Cummings Jr.,

$ 2.13M
$0
51 Exec. VP and Pres of Bottling Investments &
Supply Chain
Dollar amounts are as of 31-Dec-08 and compensation values are for the last fiscal
year ending on that date. "Pay" is salary, bonuses, etc. "Exercised" is the value of
options exercised during the fiscal year.

.
34

In 2001, after almost a decade of lagging rival Pepsi in the region, Coke
India re-examined its approach in an attempt to gain leadership in the Indian
market and capitalize on significant growth potential, particularly in rural
markets. The foundation of the new strategy grounded brand positioning and
marketing communications in consumer insights, acknowledging that urban
versus rural India were two distinct markets on a variety of important
dimensions. The soft drink categorys role in peoples lives, the degree of
differentiation between consumer segments and their reasons for entering the
category, and the degree to which brands in the category projected different
perceptions to consumers were among the many important differences
between how urban and rural consumers approached the market for
refreshment.
In rural markets, where both the soft drink category and individual
brands were undeveloped, the task was to broaden the brand positioning while
in urban markets, with higher category and brand development, the task was
to narrow the brand positioning, focusing on differentiation through offering
unique and compelling value. This lens, informed by consumer insights, gave
Coke direction on the tradeoff between focus and breadth a brand needed in a
given market and made clear that to succeed in either segment, unique
marketing strategies were required in urban versus rural India.

Rural Success
Comprising 74% of the country's population, 41% of its middle class,
and 58% of its disposable income, the rural market was an attractive target
and it delivered results. Coke experienced 37% growth in 2003 in this
segment versus the 24% growth seen in urban are as.

35

Driven by the launch of the new Rs. 5 product, per capita consumption
doubled between 2001-2003. This market accounted for 80% of Indias new
Coke drinkers, 30% of 2002 volume, and was expected to account for 50% of
the companys sales in 2003.

Brand Localization Strategy: The Two Indies

India A: Life ho to aisi
India A, the designation Coca-Cola gave to the market segment
including metropolitan areas and large towns, represented 4% of the countrys
population.3 3 This segment sought social bonding as a need and responded
to inspirational messages, celebrating the benefits of their increasing social
and economic freedoms.

Life ho to aisi, (life as it should be) was the

successful and relevant tagline found in Coca-Colas advertising to this

audience.

India B: Thanda Matlab Coca-Cola

Coca-Cola India believed that the first brand to offer communication
targeted to the smaller towns would own the rural market and went after that
objective with a comprehensive strategy. India B included small towns and
rural areas, comprising the other 96%

of the nations population. This

segments primary need was out-of-home thirst-quenching and the soft drink
category was undifferentiated in the minds of rural consumers. Additionally,
with an average Coke costing Rs. 10 and an average days wages around Rs.
100, Coke was perceived as a luxury that few could afford.
In an effort to make the price point of Coke within reach of this highpotential market, Coca-Cola launched the Accessibility Campaign, introducing
36

a new 200ml bottle, smaller than the traditional 300ml bottle found in urban
markets, and concurrently cutting the price in half, to Rs. 5. This pricing
strategy closed the gap between Coke and basic refreshments like lemonade
and tea, making soft drinks truly accessible for the first time. At the same time,
Coke invested in distribution infrastructure to effectively serve a disbursed
population and doubled the number of retail outlets in rural areas from 80,000
in 2001 to 160,000 in 2003, increasing market penetration from 13 to 25%.
Cokes advertising and promotion strategy pulled the marketing plan
together using local language and idiomatic expressions. Thanda, meaning
cool/cold is also generic for cold beverages and gave Thanda Matlab CocaCola delicious multiple meanings. Literally translated to Coke means
refreshment, the phrase directly addressed both the primary need of this
segment for cold refreshment while at the same time positioning Coke as a
Thanda or generic cold beverage just like tea, lassi, or lemonade. As a result
of the Thanda campaign, Coca-Cola won Advertiser of the Year and Campaign
of the Year in 2003.

CORPORATE SOCIAL RESPONSIBILITY

As one of the largest and most global companies in the world, CocaCola took seriously its ability and responsibility to positively affect the
communities in which it operated. The companys mission statement, called
the Coca-Cola Promise, stated: The Coca-Cola Company exists to benefit
and refresh everyone who is touched by our business. The Company has
made efforts towards good citizenship in the areas of community, by
improving the quality of life in the communities in which they operate, and the
environment, by addressing water, climate change and waste management
initiatives. Their activities also included The Coca-Cola Africa Foundation
created to combat the spread of HIV/AIDS through partnership with
37

governments, UNAIDS, and other NGOs, and The Coca-Cola Foundation,

focused on higher education as a vehicle to build strong communities and
enhance individual opportunity.
Coca-Colas footprint in India was significant as well. The Company employed
7000 citizens and believed that for every direct job, 30-40 more we re created
in the supply chain.
Like its parent, Coke Indias Corporate Social Responsibility (CSR)
initiatives were both community and environment-focused. Priorities included
education, where primary education projects had been set up to benefit
children in slums and villages, water conservation, where the Company
supported community-based rainwater harvesting projects to restore water
levels and promote conservation education, and health, where Coke India
partnered with NGOs and governments to provide medical access to poor
people through regular health camps. In addition to outreach efforts, the
company committed itself to environmental responsibility through its own
business operations in India including.
Environmental due diligence before acquiring land or starting projects.
Environmental impact assessment before commencing operations.
Ground water and environmental surveys before selecting sites.
Compliance with all regulatory environmental requirements.
Ban on purchasing CFC-containing refrigeration equipment.
Waste water treatment facilities with trained personnel at all companyowned bottling operations.
Energy conservation programs.
50% water savings in last seven years of operations

38

RESEARCH METHODOLOGY

39

RESEARCH METHODOLOGY
Objectives of the study
Objectives of this research study are1. To study the brand preference for different kind of soft drinks.
2. To determine the factors that influences the consumer choice of a
particular soft drink.
3. To study the consumption pattern & behavioral aspects of consumes
such as frequency of consumption, quantity of consumption, place of
consumption etc.
4. To study the sales promotion tool techniques sources of media that
attracts consumers most.

Scope of the study:

The research pertains to the study of consumer choice for soft drinks at
Kurnool market. This study is attempt to analyze the present top brands
preferred by customer for soft drink in Kurnool market, examine the
product factors that influence the purchasing decisions of buyers and to
know the relation between gender & preference for soft drinks & flavors.

METHODOLOGY
Data collection
The type of data collected for the research was primary as well as secondary.
Primary data was collected through:

Direct contact with the customers.

Questionnaires filled by the customers.

Secondary data was collected through:

Various journals

Internet survey reports

40

Field work and Sample

Defining the universe

Developing the sample frame

Selecting a sampling frame

Determining the sample size

Selecting the research instrument

Universe
The universe or population is the specific group of people is the specific group
of people from conditions, activities, etc. which form the pivotal point of the
project. For developing and using sample, it becomes the primary duty of
researcher to define the population from which she\he intends to draw the
sample. The universe of my project is about 130 consumers of Kurnool town,
which formed the pivotal point of my project.

Sampling frame
A sampling frame may be defined as the listing of the general components of
the individual unit that comprise the defined population.In case of my project,
sampling frame is various consumers frame is various consumers including
lower middle class, middle class and rich class.

Sampling procedure
After defining the sampling frame, other important point to be discussed is
which sampling procedure to be adopted.A simple random sampling technique
will be used to understand customers outlook towards the soft drinks.

Sample size
130 consumers of kurnool city an attempt will be made to make the sample
representative of the whole population under study.
41

Research instrument:
Questionnaires were used to find out Factors influencing consumer choice of
soft drinks in Kurnool with the help of the questionnaire, filled by 130
consumers, the result was analyzed.
The process was followed to prepare a questionnaire:
1. Specify the information needed.
2. Determined the types of questions to be asked.
3. Deciding the number and sequence of questionnaire.
4. Preparing preliminary draft of questionnaire.
5. Revised and protested the questionnaire.

Limitations
Although the research was conducted in a way to ensure accurate results but
certain errors might have occurred due to some unavoidable reasons. Some of
the limitations of the project are:-

Data collection
1. Non-response by some of the respondents.
2. Since the population is not homogeneous, some biasness might have
creped in.
3. The sample of convenience, thus it is not the true representative of the
complete.

MEASUREMENT ERROR
There was certain degree of misinterpretation by the respondents about the
points raised in the interview.

42

ANALYSIS
&
INTERPRETAYION

43

Data Analysis and Interpretation

1. Gender wise profile:

Males
Females
Total

No. of Respondents
70
60
130

In%
54%
46%
100%

Graph 1.1
Interpretation:
44

As the above graph shows that there were equal male and female respondents,
males were little higher than females by only 4%.

2. Age wise Profile:

Male
Female
Total

10-20
years

12
14
26

In %

21-30
years

17%
23%
20%

28
20
48

In %

31-40
years

40%
33%
37%

21
16
37

In %

More
than 40
years

In %

Total

30%
27%
28%

9
10
19

13%
17%
15%

70
60
130

Graph 2.1

45

Graph 2.2

Interpretation:
As the above graph clearly depicts that most of males respondents
[40%] were youth as fall into the category of 21-30 years. As the above graph
clearly depicts that most of females respondents [33%] were also youth as they
fall into the category of 21-30 years.

3. Occupation wise Profile:

Male
Female
Total

Service

In %

Business

In %

Professionals

In %

Other [Students
housewives
etc.]

In %

28
10
38

40%
17%
28.%

14
0
14

20%
0%
10%

9
8
17

13.%
13.%
13.%

19
42
61

27%
70%
47%

Graph 3.1

46

Graph 3.2

Interpretation:
As the above graph clearly shows that there were most of males
respondents [40%] were service category. As the above graph clearly shows
that there were most of females respondents [43%] were housewives category

4. Income group wise profile:

Less than

In %

Rs. 10,000

Male
Female
Total

37
42
79

10,000-

In %

15,000
53%
70%
61%

9
4
13

15,000-

In %

20,000
13%
7%
10%

9
8
17

More than

In %

20,000
13%
13%
13%

15
6
21

21%
10%
16%

Total

70
60
130

Graph 4.1

47

Graph 4.2

Interpretation:
As the above graph clearly shows that there were most of males
respondents [53%] were income group of Rs. Less than Rs. 10,000. As the
above graph clearly shows that there were most of females respondents [70%]
were income group of Rs. Less than Rs. 10,000.

5. Ranking of different flavors of soft drinks according to

choice of consumers:

48

Graph 5.1

Interpretation:
The above graph shows that Mango Flavor is preferred most by the male
customers than next is Cola & Lemon is least preferred by them.
The above graph shows that Orange Flavor is preferred most by the
female customers than next is Mango & Cola is least preferred by them.

6. Brand recall of different soft drink brands:

Brand
Recall
Top of

Cola

Pepsi

Thums up

Fanta

Slice

Mirinda

Limca

Fruity

Maza

70%

60%

60%

65%

60%

40%

45%

55%

60%

49

the mind
recall
Unaided
recall

30%

40%

40%

35%

40%

60%

55%

45%

40%

Graph 6.1

Interpretation:
As the above graph shows that comparatively coke is at the top of the
mind recall by most of customers [70%] and next is Pepsi. In Unaided brand
recall Maza and Fruity.

7. Ranking of factors that influence the consumer choice of

soft drink:
Factors
Taste
Price
Health
Weather

Male
1
2
3
4

Female
1
5
3
2
50

Social Gathering
Packaging
Ads & offers
Status

5
6
7
8

4
6
8
7

Graph 7.1

Interpretation:
Taste ranked as first factor affecting consumer choice by both male &
female consumers. Price is ranked second by male consumers whereas health
factor is ranked by female consumers which affect their choice of soft drinks.

8. Consumption per week by consumers:

Male
Female
total

Less
than 5
times

In%

6-10
times

In%

More
than 10
times

In%

Undecided

In%

Total

47
44
91

67%
74%
70%

12
8
20

17%
13%
15%

2
0
2

3%
0%
2%

9
8
17

13%
13%
13%

70
60
130

51

Graph 8.1

Graph 8.2

Interpretation:
From the above graph we can say that most of the consumers [70%] are
not having any regular schedule of consuming soft drinks. Both males [13%] &
females [13%] consumer said that it is undecided and only 1.54% consumer
said that they drink more than 10 times in week so it is not definite.

9. Quantity of consumption at once:

Male
Female
Total

200ml.

In%

300ml.

In%

500ml.

In%

More than
500ml.

In%

Total

23
24
47

33%
40%
37%

28
24
52

40%
40%
40%

19
12
31

27%
20%
23%

0
0
0

0%
0%
0%

70
60
130

52

Graph 9.1

Graph 9.2

Interpretation:
From the graphs we can say that [Both males & females] majority of the
consumers [40%] prefer to drink these soft drinks in the quantity of 300 ml. at
once & than next is 200 ml. with [37%] but there is big difference in consumer
response for the rests of the options.

10. Drinking Pattern:

53

Male
Female
Total

With group

In%

Alone

In%

Total

58
54
112

82.86%
90%
87.69%

12
6
18

17.14%
10%
12.31%

70
60
130

Graph 10.1

Graph 10.2

54

Graph 10.3

Interpretation:
From the above it is clearly visible that mostly customers [87.69%]
enjoy drinking these soft drinks when they are with group.

11. Area of consumption:

Home

In %

Outside
location

In %

Cinema
Halls

In %

Social

In

B/C

Gathering

parties

In %

55

Male
Female
Total

14
20
34

20%
33%
26%

30
18
48

43%
30%
37%

12
18
30

17%
30%
23%

5
4
9

7%
7%
7%

9
0
9

13%
0%
7%

Graph 11.1

Graph 11.2

Graph 11.3

Interpretation:
As the about graphs show that mostly [37%] customers prefer drinking at
outside location & at home/office and cinema halls. This means customer drink
these drink whenever they go for outing locations.

12. Consumer choice when multiple choices are given without price.
Soups

In %

Hot
drinks

In %

Soft
Drinks

In %

Fruit
juices

In %

Total

56

Male
Female
Total

14
16
30

20%
27%
23%

9
10
19

13%
17%
15%

28
20
48

40%
33%
37%

19
14
33

27%
23%
25%

70
60
130

Graph 12.1

Graph 12.2

Graph 12.3

Interpretation:
From the above graph it is seen that when multiple choice are given
to customers without any charge for that i.e. when price factor is excluded, then
more than 37% customers prefer to drink soft drinks and next is Fruit juices,
soups, tea/coffee respectively.

13. Sources of Information:

News
Paper

In %

T.V.
ads

In %

Hoarding

In %

By
retailers

In %

Total

57

Male
Female

12
6

17%
10%

42
42

60%
70%

12
10

17%
17%

4
2

7%
3%

70
60

Total

18

14%

84

64%

22

17%

5%

130

Graph 13.1

Graph 13.2

Graph 13.3

Interpretation:
From the above graph it is clearly visible that main source of information
to customers regarding soft drinks is T.V. ads according to 64% customers.

14. Influence of Brand Ambassador Consumer choice of Soft drinks.

Male

Yes
49

In %
70%

No
21

In %
30%

Total
70
58

Female
Total

24
73

40%

36
57

60%

60
130

Graph14.1

Interpretation:
From the above graph clearly depicts that here is a big difference among
the response of male & female customer, as in the opinion of most of the male
customers [70%] Brand ambassador influences their choice whereas in the
opinion of female majority [60%] said that there is no impact of any Brand
Ambassador upon their choice.

15. Preferred Celebrities as Brand Ambassador according to

Consumers:
Bollywood
Celebrities

In %

Sports
Celebrities

In %

Both

In %

Other
celebrities

In
%

Total
59

Male
Female
Total

30
16
46

43%
27%
35%

12
28
40

17%
46%
31%

23
12
35

33%
20%
27%

5
4
9

7%
7%
7%

70
60
130

Graph15.1

Graph 15.2

Graph15.3

Interpretation:
As the graph depicts that highest 35% people said that bollywood
celebrities should be the brand ambassador of soft drinks and than 27% were
with both but here is big difference among the choice of male & female
customers.

16. Most preferred sales promotion tools/techniques:

60

Buy 2 get
1 free
Male
Female
Total

12
14
26

Scratch/
Magic
cards
7
8
15

Price
discounts
30
22
52

Extra
Quantity
offer
14
10
24

Something
free

Total

7
6
13

70
60
130

Graph 16.1

Graph 16.2

Graph 16.3

Interpretation:
As per the analysis of above graphs that of the customers [40%] prefer
price discounts then there is buy 2 get 1 free offer.

17. Brand Loyalty among Consumers of Soft drinks:

Brand loyal

In %

Not Brand

In %

Total
61

Male
Female
Total

28
18
46

40%
30%
35%

loyal
42
42
84

60%
70%
65%

70
60
130

Graph 17.1

Interpretation:
As the above graphs show there are 35% customers who brand loyal but
males are having much loyalty in comparison to females customers.

Findings

62

1. No. of Respondents:
There were total 130 respondents out of which 70 were males &
60 were females.
2. Age group:
20% respondents fall into the age group of 10-20 years.
37% respondents fall into the age group of 21-30 years.
28% respondents fall into the age group of 31-40 years.
15% respondents fall into the age group of more than 40years.
3. Occupation of respondents:
28% of the respondents were Service.
10% of the respondents were Business
13% of the respondents were Professionals
47% of the respondents were Students & housewives etc.
4. Income group of respondents:
61% of the respondents fall into the income group of less than
Rs.10,000.
10% of the respondents fall into the income group of 10,00015,000.
13% of the respondents fall into the income group of 15,00020,000.
16% of the respondents fall into the income group of more than
Rs.20,000.
5. Ranking of factors that influence the consumer choice of soft drink:
Taste ranked as first factor affecting consumer choice by both
male & female consumers.
Price is ranked second by male consumers whereas health factor
is ranked by female consumers which affect their choice of soft
drinks.

63

6. Ranking of different flavors of soft drinks according to choice of

consumers:
Mango Flavor is preferred most by the male customers than next
is Cola & Lemon is least preferred by them.
Orange Flavor is preferred most by the female customers than
next is Mango & Cola is least preferred by them.
7. Brand recall of different soft drink brands:
Comparatively coke is at the top of the mind recall by most of
customers [70%] and next is Pepsi. In Unaided brand recall
Maaza and Fruity.
8. Consumption per week by consumers:
70% of the consumers said that their consumption per week of
soft drink is less than 5 times.
15% of the consumers said that their consumption per week of
soft drink is 6-10 times.
2% of the consumers said that their consumption per week of soft
drink is more than 10 times.
13% of the consumers said that their consumption per week of
soft drink is Undecided.
9. Quantity of consumption at once:
37% of the consumers like to drink 200 ml. of soft drinks at once.
40% of the consumers like to drink 300 ml. of soft drinks at once.
23% of the consumers like to drink 500 ml. of soft drinks at once.
Zero of the consumers like to drink more than 500 ml. of soft
drinks at once.
10. Drinking Pattern:
87.69% of the consumers enjoy drinking soft drinks in group.
12.31% of the consumers enjoy drinking soft drinks alone.
11. Area of consumption:
64

 26% mostly consume these drinks at home/offices.

37% mostly consume these drinks at outside location.
23% mostly consume these drinks at cinema halls.
7% mostly consume these drinks at social gatherings.
7% mostly consume these drinks at business/corporate parties.
12. Consumer choice when multiple choices are given without price.
23% customers prefer to drink soups when price factor is
excluded.
15% customers prefer to drink hot drinks when price factor is
excluded.
37% customers prefer to drink soft drinks when price factor is
excluded.
25% customers prefer to drink Fruit juices when price factor is
excluded.
13. Source of information:
14% of the consumers said that they get information regarding
different brands of soft drinks through News paper Ads.
64% of the consumers said that they get information regarding
different brands of soft drinks through T.V. Ads.
17% of the consumers said that they get information regarding
different brands of soft drinks through hoardings.
5% of the consumers said that they get information regarding
different brands of soft drinks through by retailers.
14. Influence of Brand Ambassador Consumer choice of Soft drinks.
70% of males consumers said that there choice is influenced by
brand ambassadors.
Whereas 60% of the females consumers said that there choice is
not influenced by any brand ambassadors.
15. Most preferred sales promotion tools/techniques:
20% of the consumers like Buy 2 get 1 free.
65

 12% of the consumers like Scratch/ Magic cards.

40% of the consumer like Price discounts.
18% of the consumer like Extra Quantity offer.
10% of the consumers like something free.
16. Brand Loyalty among Consumers of Soft drinks:
40% male consumers were brand loyal and:
Only 30% female consumers were brand loyal for soft drink.

Conclusion
Through this research study we conclude that

There many flavors but Mango flavor is liked most by the

consumer. Cola & mango are also popular among male & female
consumer respectively.
Generally people are not having any regular timing or drinking soft
drink but we can assume that on an average every customer drink
these drinks less than 5 times in a week.
Generally people prefer to drink 300 ml. quantity of soft drink at
once.
Most of consumer s drinks such soft drinks in group.
Generally people drink these drinks at outside locations whenever
they go for outing & cinema halls.
If price factor is not taken into consideration & multiple choices
are given to consumer then they prefer soft drink most.
The most popular source of information regarding soft drink
brands is T.V.
Brand ambassador has the influence on choice of most of the
male consumer. But there is comparatively less influence on
female consumer.
According to most of the male consumers bollywood celebrities
should be the brand ambassador where as according to the most
66

of female consumers sports celebrities should be the brand

ambassador for endorsing soft drinks.
The three most preferred sales promotion techniques are price
discount, but to get one free & something free with product
respectively.
Half of the male consumers are brand loyal whereas female
consumers are comparatively less who the brand loyal is.
The most influencing factor is price. According male consumers
price is also having more influence but according to females
health factor is much more influencing than price as they may be
very health conscious.

67

Suggestions
Promotion of mango flavor :
Companies should focus more on the promotion of mango flavors of soft
drinks because comparatively to cola drinks mango flavored drinks are
very less advertised & promoted by soft drink brands where as according
to our result cola flavor is more preferred by most of the consumers.
Maintaining taste & keep launching innovative flavors :
Companies should maintain the taste of its flavored drinks should keep
improving the taste & quality of its drinks, companies may also launched
some innovative mixed flavors of drinks where two flavors in one drink
can be provide like orange-pineapple etc. it will give a different taste of
customers.
Reduction in price :
Price is also major factor of consumers choice of soft drinks. So
companies should try to decrease its price by decreasing its
extravagant expenditure in advertisement to trap the market of those
customers whose choice is very much affected with the price of soft
drinks.
Diet drinks :
Health is also a major factor influencing consumer choices of many
consumers. So fruit juice are giving tough competition to soft drinks.
Companies should advertised its product in a manner in which its
reflects that consuming their drinks will not harm any body. As coke &
Pepsi have already lunched its drinks for the segment which is very
much health conscious i.e. Diet Coke & Diet Pepsi respectively which
are fat free. But companies should launch diet drinks in other flavors
also. Especially in mango flavor as it is preferred by most of the
68

consumers. Companies should try to win the trust of consumers that

these drinks are not having pesticides contents more than limits by
sponsoring some rational appeal based advertisement.
Quantity discounts :
Companies should try to increased the sales of its drinks for the purpose
of increasing its offering in parties. As in parties consumers mostly
prefer soft drinks even after having multiple choices, companies should
provide quantity discount as in parties more quantity is purchased at
once.
Humorous, creative & sensible ads :
As companies are already promoting their brands through T.V. ads but
companies should take very much care of the target segment & should
ensure that no ad should hurt the person directly or indirectly. Now a
days ad with humorous appeals are like by viewers very much so there
should be humorous creative ads on T.V.
Selection of brand ambassador :
Companies should get the endorsement from both Bollywood & Sports
celebrities as most as the people like those ads where both of these
celebrities endorse the product together.
Sales promotion :
For sales promotion companies should give the price discount as it is
preferred by most of the customers. In of seasons companies already
provide but if in the summer companies should price discount then it can
be boost up there sales both in Rupees & volume. Companies should
bye to get one free schemes also some complementary product also
may be given with big bottle i.e. like two ltr.
Brand loyalty :
As there were not more customers who are brand loyal & easily switch
on to other brands. So companies should strengthen its distribution
network & ensure the proper supply & arability of there drinks to prevent
69

people switching on to other brands, companies should also organized

activities and should do programs, seminars for social & moral causes to
build its brand image & brand loyalty amongst the customers.

Annexure
Questionnaire for the study of factors affecting consumer choice of soft-drinks
Name
Gender:
[ ] Male
[ ] Female
Age group: [ ] 10-20 years
[ ] 21-30 years
[ ] 31-40 years
[ ] More than 40 years
Occupation: [ ] Service
[ ] Business
[ ] Professional
[ ] Student
[ ] Housewife
[ ] Others________
Income group (p.m.) [ ] Less than Rs.10,000
[ ] 10,000-15,000
[ ] 15,000-20,000
[ ] More than Rs. 20,000
1. Please rank the following flavors of soft drinks that you like most.
Cola_______
Orange________
Mango_____
Lemon________
2. Please name the brands of soft drinks, which you remember.
_________________________________________________
3. Please name the brand/s of soft drinks that you like most for following flavors.
Cola_______
Orange________
Mango_____
Lemon________
4. Please name the following that influence your decision when you purchase a
soft drink? (On 1-8 scale, where 1 is highest & 8 is lowest rank)
Taste________
After effects/Health_________
Price________
Occasion/Social Gathering_______
Packaging______
Advertisement & offers_________
Weather/Heat_____
Status__________
5. How many times you drink these beverages in a week?
[ ] Less than 5 times
[ ] 6-10 times
[ ] more than 10 times
[ ] Undecided
6. How much quantity of these do beverages do you consume at once?
[ ] 200 ml.
[ ] 300 ml
[ ] 500 ml.
[ ] More than 500 ml..
70

7. You enjoy drinking these drinks?

[ ] With group
[ ] Alone

8. Mostly where do you consume such drinks?

[ ] At home/office
[ ] At outside locations
[ ] At cinema halls
[ ] At social gathering
[ ] At corporate/business parties [ ] others_____
9. In a party, if following drinks are offered to you then whom drink you would
like to take?
[ ] Soups
[ ] Hot drinks/coffee/Tea
[ ] Cold/Soft drinks
[ ] Fruit juices
10. How do you get information regarding the different brand & flavors of these
beverages available in the market?
[ ] Newspapers ads.
[ ] T.V. ads.
[ ] Hoardings & Banners
[ ] By retailers
[ ] Other________
11. Dose any brand ambassador of these drinks influence your choice?
[ ] Yes
[ ] No
12. Please name any brand & its brand ambassador.
Brand name_____________
Brand ambassador ____________
13. According to you, who should be the brand ambassador for soft drink?
[ ] Bollywood celebrities
[ ] Sports celebrities
[ ] Both
[ ] Other celebrities_______
14. Which of the following sales promotion tools/techniques do you like most for
soft drink?
[ ] Buy two get 1 free
[ ] Scratch/Magic card
[ ] Price discount
[ ] Extra quantity offer
[ ] Something free
[ ] Others__________
15. Do you easily switch on to other brand when you do not get your favorite &
desired brand/s for these drinks?
[ ] Yes
[ ] No
Thanks very much for your kind support & cooperation.

71

BIBLIOGRAPHY

72

Bibliography:

Marketing Management Philip Kotler

Marketing Management V.S Rama Swami & S.Namakumari

Research Methodology C.R.Kothari

Website of Hindustan Pepsi limited

http://www.pepsiindia.co.in/brands.aspx retrieved on 31st Jan 2010

http://www.pepsiindia.co.in/ retrieved on 31st Jan 2010

73

74