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Headquartered in Purchase, New York, with Research and Development

Headquarters in Valhalla, NY, The Pepsi Cola Company began in 1898 by a
Pharmacist and Industrialist Caleb Bradham, but it only became known as
PepsiCo when it merged with Frito Lay in 1965. Until 1997, it also owned KFC,
Pizza Hut, and Taco Bell, but these fast-food restaurants were spun off into
Tricon Global Restaurants, now Yum! Brands, Inc. PepsiCo purchased Tropicana
in 1998, and Quaker Oats in 2001. In December 2005, PepsiCo surpassed Coca-
Cola Company in market value for the first time in 112 years since both
companies began to compete. In 2008 PepsiCo. donated a half-million dollars to
Parents, Families and Friends of Lesbians and Gays, an action which resulted in a
boycott of the brand led by the American Family Association.



PepsiCo gained entry to India in 1988 by creating a joint venture with the Punjab
government-owned Punjab Agro Industrial Corporation (PAIC) and Voltas India
Limited. This joint venture marketed and sold Lehar Pepsi until 1991, when the
use of foreign brands was allowed; PepsiCo bought out its partners and ended
the joint venture in 1994. Others claim that firstly Pepsi was banned from import
in India, in 1970, for having refused to release the list of its ingredients and in
1993, the ban was lifted, with Pepsi arriving on the market shortly afterwards.
These controversies are a reminder of "India's sometimes acrimonious
relationship with huge multinational companies." Indeed, some argue that
PepsiCo and The Coca-Cola Company have "been major targets in part because
they are well-known foreign companies that draw plenty of attention."

In 2003, the Centre for Science and Environment (CSE), a non-governmental

organization in New Delhi, said aerated waters produced by soft drinks
manufacturers in India, including multinational giants PepsiCo and The Coca-Cola
Company, contained toxins, including lindane, DDT, malathion and chlorpyrifos
— pesticides that can contribute to cancer, a breakdown of the immune system
and cause birth defects. Tested products included Coke, Pepsi, 7 Up, Mirinda,
Fanta, Thums Up, Limca, and Sprite. CSE found that the Indian-produced Pepsi's
soft drink products had 36 times the level of pesticide residues permitted under
European Union regulations; Coca Cola's 30 times. CSE said it had tested the
same products in the US and found no such residues. However, this was the
European standard for water, not for other drinks. No law bans the presence of
pesticides in drinks in India.

The Coca-Cola Company and PepsiCo angrily denied allegations that their
products manufactured in India contained toxin levels far above the norms
permitted in the developed world. But an Indian parliamentary committee, in
2004, backed up CSE's findings and a government-appointed committee, is now
trying to develop the world's first pesticides standards for soft drinks. Coke and
PepsiCo opposed the move, arguing that lab tests aren't reliable enough to
detect minute traces of pesticides in complex drinks. On December 7, 2004,
India's Supreme Court ruled that both PepsiCo and competitor The Coca-Cola
Company must label all cans and bottles of the respective soft drinks with a
consumer warning after tests showed unacceptable levels of residual pesticides.
[citation needed]

Both companies continue to maintain that their products meet all international
safety standards without yet implementing the Supreme Court ruling. As of
2005, The Coca-Cola Company and PepsiCo together hold 95% market share of
soft-drink sales in India. PepsiCo has also been accused by the Puthussery
panchayat in the Palakkad district in Kerala, India, of practicing "water piracy"
due to its role in exploitation of ground water resources resulting in scarcity of
drinking water for the panchayat's residents, who have been pressuring the
government to close down the PepsiCo unit in the village.

In 2006, the CSE again found that soda drinks, including both Pepsi and Coca-
Cola, had high levels of pesticides in their drinks. Both PepsiCo and The Coca-
Cola Company maintain that their drinks are safe for consumption and have
published newspaper advertisements that say pesticide levels in their products
are less than those in other foods such as tea, fruit and dairy products. In the
Indian state of Kerala, sale and production of Pepsi-Cola, along with other soft
drinks, was banned by the state government in 2006, but this was reversed by
the Kerala High Court merely a month later. Five other Indian states have
announced partial bans on the drinks in schools, colleges and hospitals.


• PepsiCo Foundation announces two major new grants to WaterPartners
and Safe Water Network programs to provide access to safe water and
sanitation in developing countries
• PepsiCo Again Named to the Dow Jones Sustainability Index
• PepsiCo Agrees to Buy Bulgaria's Leading Nuts and Seeds Company
• PepsiCo Announces Initiatives With the Earth Institute and H2O Africa to
Drive Sustainable Water Practices
• Forbes Names PepsiCo Among Its Best Big Companies
• PepsiCo India Commissions First Remote Wind Turbine to Generate
Renewable, Clean Energy
• CRO Names PepsiCo to Top 25 100 Best Corporate Citizens 2008
• PepsiCo to Buy Russian Juice Leader, Lebedyansky
• Employees Lead Effort to Make Chicago Plaza First LEED-Certified PepsiCo
• Gatorade Launches Gatorade Tiger with Comprehensive Integrated
Marketing Campaign
• PepsiCo Honored with 2008 Energy Star Partner of the Year Award
• UK Vitamin Water Brand- V Water Acquired by PepsiCo
• Quaker Plant in Cedar Rapids Closes and Reopens Facility Due to Flooding
to Protect Employees
• PepsiCo Foodservice and Naked Juice Expand Starbucks Presence
• Gatorade Sports Science Institute Gathers World's Leading Researchers on
Protein Nutrition
• PepsiCo International's China Foods Wins "China's Top Leaders 2008"
• Wall Street Journal Article Recognizes PepsiCo for Leadership in
Employment of People with Different Abilities
• PepsiCo and Frito-Lay Join SmartWay in Commitment to Reduce
Greenhouse Gas Emissions
• PepsiCo Beats Coke in Race to Launch New Natural Sweetener (Stevia)
• PepsiCo France Recognized as "Great Place To Work" by Institute Survey
• PepsiCo Commits to Reducing Acryalmide Levels in Potato Chip Products
and Restructured Potato Snacks in California
• Subway Names PepsiCo "Vendor of the Year" for Sustainability Leadership
• Tazo Tea Joins Pepsi Lipton Partnership

PepsiCo owns 5 different billion-dollar brands. These are Pepsi, Tropicana, Frito-
Lay, Quaker, and Gatorade. The company owns many other brands as well.
Pepsi, Caffeine-Free Pepsi, Diet Pepsi/Pepsi Light, Caffeine-Free Diet Pepsi,
Caffeine-Free Pepsi Light, Wild Cherry Pepsi, Pepsi Lime, Pepsi Max, Pepsi Twist
and Pepsi ONE.

Other U.S. carbonated soft drinks, including Mountain Dew, Mug Root Beer,
Sierra Mist, Tropicana Twister Soda and Frawg,

7 Up (Globally, outside the USA)

Other U.S. beverages, including Aquafina (Flavor Splash, Alive, and

Twist/Burst), Tava, Dole, Gatorade, Izze, Mountain Dew AMP, Propel Fitness
Water, SoBe, Quaker Milk Chillers, Ben & Jerry's MilkShakes, and Tropicana

Beverages marketed outside the U.S.: Alvalle, Concordia, Copella, Evervess,

Fiesta, Frui'Vita, Fruko, Junkanoo, Kas, Loóza, Manzana Corona, Manzanita Sol,
Mirinda, Paso de los Toros (drink), Radical Fruit, San Carlos, Schwip Schwap,
Shani, Teem, Triple Kola, and Yedigun

Frito-Lay brands: Baken-ets, Barcel, Bocabits, Cheese Tris, Cheetos, Chester's,

Chizitos, Churrumais, Cracker Jack, Crujitos, Doritos, Fandangos, Fritos, Funyuns,
Gamesa, Go Snacks, James' Grandma's Cookies, Hamka's, Lay's, Miss Vickie's,
Munchies, Munchos, Nik Naks, Ollie's Meat Snacks, Quavers, Rold Gold, Ruffles,
Rustler's Meat Sticks, Sabritas, Sabritones, Sandora, Santitas, Smartfood, The
Smith's Snackfood Company, Sonric's, Stacy's Pita Chips, Sun Chips, Tor-tees,
Kurkure, Tostitos, Walkers, and Wotsits

Quaker Oats brands: Aunt Jemima, Cap'n Crunch, Coqueiro, Crisp'ums, Cruesli,
FrescAvena, King Vitaman, Life, Oatso Simple,Quake, Quisp, Rice-A-Roni, and

In 2007, Nooyi spent $1.3 billion on healthier-alternative brands like Naked Juice,
a California maker of soy drinks and organic juice.

• Pepsi-Cola

• Diet Pepsi
• Slice

• Diet Mountain Dew

• Pepsi Blue

• Pepsi Lemon

• Mirinda

• 7 up

• Fruko


• Lay’s potato chips

• Manchos potato chips

• Lay’s Fries

• 3D’s snacks

• Frito’s corn chips

• Kurkure

• Red Rock Deli

• Cheetos

• Smith’s potato chips

• Gatorade Thirst Quencher

• Gatorade Frost Thirst Quencher

• Gatorade Ice Thirst Quencher

• Gatorade X Factor Thirst Quencher

• Gatorade X Tremo Thirst Quencher

• Tropicana pure premium juices

• Tropicana twister juice drinks

• Tropicana smoothies

• Tropicana pure tropics juices

• Dole juices (license)

• Tropicana 100 juices

• Naked juice

• Tropicana touché de lait

• Copella juices
• Quaker oatmeal

• Quaker rice snacks

• Puffed wheat

• Quaker rice cakes

• Quaker bakeries

• Quaker’s fruit

• Corn goods














Marketing Mix is the set of marketing tools that the firm uses to pursue its
marketing objectives. Marketing mix has a classification for these marketing
tools. These marketing are classified and called as the Four Ps i.e. Product, Price,
Place and Promotion.

The most basic marketing tool is product which includes product design, quality,
features, branding, and packaging.
A critical marketing tool is price i.e. the amount of money that customers pay for
the product. It also includes discounts, allowances, credit terms and payment

Place is another key marketing mix tool. And it includes various activities the
company undertakes to make the product accessible and available to the
customer. Some factors that decide the place are transport facilities, channels of
distribution, coverage area, etc.

Promotion is the fourth marketing mix tool which includes all the activities that
the company undertakes to communicate and promote its product to target
market. Promotion includes sales promotion, advertising, sales force, public
relations, direct marketing, etc.

Pepsi - Product
The Pepsi-Cola drink contains basic ingredients found in most
other similar drinks including carbonated water, high fructose
corn syrup, sugar, colorings, phosphoric acid, caffeine, citric
acid and natural flavors. The caffeine free Pepsi-Cola contains
the same ingredients but no caffeine.

Some of the different and varied brands of Pepsi are as follows:

1. All Sport 18. Pepsi

2. Aquafina 19. Pepsi Blue
3. Caffeine-Free Pepsi 20. Pepsi Cappuccino
4. Crystal Pepsi 21. Pepsi Max
5. Diet Pepsi 22. Pepsi ONE
6. Gatorade 23. Pepsi Samba
7. Izze 24. Pepsi Tarik
8. Jazz 25. Pepsi Twist
9. Josta 26. Propel Fitness
10. Kas Water
11. Manzanita Sol 27. Sierra Mist
12. Mirinda 28. Slice
13. Mountain Dew 29. SoBe
14. Mountain Dew AMP 30. Storm
15. Mountain Dew LiveWire 31. Teem
16. Mountain Dew MDX 32. Tropicana Products
17. Mug Root Beer 33. Tropicana Twister

Pepsi – Price
Pepsi again decides it price on the basis of competition. The best think about the
company Pepsi is that it is very flexible and it can come down with the price very
quickly. The company is renowned to bring the price down even up to half if

But this risk taking attitude has also earned Pepsi losses. Though lowering the
price would attract the customers but it would not help them cover up the cost
incurred in production hence causing them losses. This was the situation earlier
but now Pepsi is a full-fledged and growing company. It has covered all its losses
and is now growing at a rapid rate.

Pepsi – Place
Pepsi again has spread worldwide. Pepsi when entering a new market does not
go in alone but it looks for partners and mergers. Till now Pepsi has collaborated
with companies like Quaker Oats, Frito-lays, Lipton, Starbucks, etc. Pepsi like
Coke has spread all over the world. It is because of this worldwide spread that
now it is coming up with Advertisements which can be broadcasted in the
different nations in the world. The recent example with would be the Pepsi
advertisements having David Beckham as it brand ambassador.

Pepsi- Promotion
Pepsi promotes its products by personal selling, advertising, and sales
promotion. For advertising, and sales promotion it used printed and electronic
media. Every newspaper and magazine carry Pepsi advertisements.
Advertisement of Pepsi are eye catching and attractive. Through advertising it
informs the consumer about new brands and flavours. Pepsi designs its sales
promotion strategies and advertisement campaign focusing strictly on the target
markets. Pepsi has been catching the trends of society. National songs by bands
like “Vital Signs”, “Awaaz”, “Junoon” and “Strings” were the keys in their
advertisement campaign. Sponsoring the pop industry and the cricketing team
helped Pepsi hit right on target of their primary market which consists of

The management of PEPSI uses both the skimming and penetration pricing
strategy. The brands, which has price greater than Pepsi beverage is skimming
pricing strategy, and brands having prices less than one can of Pepsi adopted
penetration-pricing strategy. By adopting skimming they are earning more profit
and by penetration they attract the customers and consolidating position in the
market. They have to adopt both strategies because they are facing established
competition in the market, e.g. In beginning the main competitors for Pepsi are
Coca cola & RC, now their major competitor is Coca cola.

Capturing the market is the main issue facing any company and when it comes
to Beverage market, it becomes more intense because there are just two players
and they are fighting strongly to capture each others market and don't have any
other option. Both Coke and Pepsi are trying to gain market share in this
beverage market, which is valued at over $30 billion a year. Just how is this done
in such a competitive market is the underlying issue. The facts are that each
company is coming up with new products and ideas in order to increase their
market share. Pepsi has always taken the lead in developing new products, but
Coke soon learned their lesson and started to do the same. Coke hired marketing
executives with good track records (98). Coke also implemented cross training of
managers so it would be more difficult for cliques to form within the company

The creativity and effectiveness of each company's marketing strategy will

ultimately determine the winner with respect to sales, profits, and customer
loyalty. These two companies are constructing new ways to sell Coke and Pepsi,
but they are also thinking of ways in which to increase market share in other
beverage categories. Although the goal of both companies are exactly the same,
the two companies rely on somewhat different marketing strategies. Pepsi has
always taken more risks, acted rapidly, and was always developing new
advertising ideas. Both companies have also relied on finding new markets,
especially in foreign countries. In the foreign markets, Coke has been more
successful than Pepsi. For example, in Eastern Europe, Pepsi has relied on a
barter system that proved to fail. However, in certain countries that allow direct
comparison, Pepsi has beat Coke. In foreign markets, both companies have
followed the marketing concept by offering products that meet consumer needs
in order to gain market share. For instance, in certain countries, consumers
wanted a soft drink that was low in sugar, yet did not have a diet taste or image.
Pepsi responded by developing Pepsi Max.

The next step is to take fast action to develop a product that meets the
requirements for that particular region. Both companies cannot just sell one
product; if they do they will not succeed. They have to always be creating and
updating their marketing plans and products. The companies must be willing to
accommodate their “target markets”. Gaining market share occurs when a
company stays one-step ahead of the competition by knowing what the
consumer wants. My recommendation is to make sure the company is always
doing market research. This way they are able to get as much feedback as
possible from consumers. Next, analyze this data as fast as possible, and then
develop the new product based upon this data. Once the product is developed,
get it to the marketplace quickly. Time is a very critical factor. In my opinion,
with all of these factors taken into consideration any company should give any
company a good jump on market share.

The beginning of the Cola war:

1975 heralded the ‘Pepsi Challenge’, a landmark marketing strategy, which
convinced millions of consumers that the taste of Pepsi was superior to Coke.
Simultaneously, Pepsi Light, with a distinctive lemon taste, was introduced as an
alternative to traditional diet colas. In 1983 Coke launched aspartame/saccharin
blend Diet Coke. In response in 1989 Pepsi-Cola introduced an exciting new
flavor, Wild Cherry Pepsi. Thus Diet Pepsi's 'The Other Challenge' campaign was
based around a 54-46% lead over Diet Coke in independently researched taste
tests in Australia. It was only in 1996 that Pepsi unveiled a revolutionary 'blue'
look worldwide 'to transform the image and attitude' of one of the world's best-
known brands. 'Pepsi Blue represents a quantum leap into the future and
redefines how the Cola Wars will be fought and won in the 21st Century.'

Coke and Pepsi in India:

Coca-Cola controlled the Indian market until 1977, when the Janata Party beat
the Congress Party of then Prime Minister Indira Gandhi. To punish Coca-Cola's
principal bottler, a Congress Party stalwart and longtime Gandhi supporter, the
Janata government demanded that Coca-Cola transfer its syrup formula to an
Indian subsidiary. Coca-Cola balked and withdrew from the country. India, now
left without both Coca-Cola and Pepsi, became a protected market. In the
meantime, India's two largest soft-drink producers have gotten rich and lazy
while controlling 80% of the Indian market. These domestic producers have little
incentive to expand their plants or develop the country's potentially enormous
market. Some analysts reason that the Indian market may be more lucrative
than the Chinese market. India has 850 million potential customers, 150 million
of whom comprise the middle class, with disposable income to spend on cars,
VCRs, and computers. The Indian middle class is growing at 10% per year. To
obtain the license for India, Pepsi had to export $5 of locally made products for
every $1 of materials it 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. In the end, all parties involved seem to come out ahead:
Pepsi gains access to a potentially enormous market; Indian bottlers will get to
serve a market that is expanding rapidly because of competition; and the Indian
consumer benefits from the competition from abroad and will pay lower prices.
Even before the first bottle of Pepsi hit the shelves, local soft drink
manufacturers increased the size of their bottles by 25% without raising costs.
As seen above both the companies Coke and Pepsi have a
number of products. Many of these products are innovations but
there are also many products which are brought out just as a
competitive product for the other companies. Some of these
products that are brought in the market by both the companies
to compete against each other are as follows:

Coke Pepsi

The main dark cola drink of the Pepsi version of dark cola which is the
company which started the rivalry major primary competitor to Coke.
between these companies.

Full Throttle is an energy AMP is an energy drink

drink brand produced by The produced and distributed by
Coca-Cola Company. It PepsiCo under the Mountain
debuted in late 2004 in North Dew soft drink brand.

Vault is a carbonated Mountain Dew MDX is an

beverage that was released energy drink manufactured
by The Coca-Cola Company in and distributed by PepsiCo
June 2005. under the Mountain Dew
brand. It was introduced in

Powerade is a sports drink by Gatorade is a non-carbonated

The Coca-Cola Company and sports drink marketed by
currently number two in the Quaker Oats Company, a
sports drink market division of PepsiCo. Originally
worldwide. made for athletes, it is now
often consumed as a snack

Sprite is a clear, lemon-lime 7 Up is a brand of a lemon-lime

flavored, non-caffeinated soft flavored soft drink.
drink, produced by the Coca-
Cola Company. It was
introduced to the United
States in 1961.

Tropicana Products is an
Minute Maid is a product line American company based in
of beverages, usually Bradenton, Florida, USA,
associated with orange juice, which is one of the world's
but now extends to soft largest producers and
drinks of many kinds. The marketers of orange juice. It
Minute Maid company is now has been owned by PepsiCo,
owned by Coca-Cola, and is Inc. since 1998.
the world's largest marketer
of fruit juices and drinks. It is
headquartered in Houston,

Nestea is a brand of iced tea Lipton Original Iced Tea is a

manufactured and distributed ready-to-drink iced tea brand
by the Nestle company's sold by Lipton through a
beverage department in the worldwide partnership with
United States, and by Coca- Pepsi.
Cola in several European
countries, Brazil and

Barq's is a brand of root beer Mug Root Beer is a brand name of

notable for being the only root beer made by the Pepsi
major North American root company.
beer to contain caffeine. It
has been bottled since the
start of the 20th century and
is currently sold by the Coca-
Cola Company.

Diet Coke or Diet Coca-Cola is Diet Pepsi is a low-calorie

a sugar-free soft drink carbonated cola. It was
produced and distributed by introduced in 1964 as a
The Coca-Cola Company. It variant of Pepsi-Cola with no
was introduced in the United sugar.
States in July 1982.

Kinley is a brand of still or Aquafina is a non-carbonated bottled

carbonated water owned by water produced by PepsiCo.
The Coca-Cola Company.

Aquarius is a mineral sports All Sport was a sports drink.

drink manufactured by The It is produced by PepsiCo.
Coca-Cola Company. It was
first introduced in 1983.

Fanta is a soft drink brand Mirinda is a brand of soft

owned by The Coca-Cola drink. Mirinda is owned by
Company. It is produced and PepsiCo.
distributed by The Coca-Cola
Company's bottlers.
Sprite Ice was the first flavor Pepsi Blue is a soft drink made by
extension for The Coca-Cola PepsiCo and launched in mid-2002.
Company's Sprite brand soft

Coca-Cola Blak is a coffee- Pepsi Cappuccino is a

flavoured soft drink cappuccino-flavored
introduced by Coca-Cola in carbonated soft drink
2006. produced by Pepsico.

Maaza is a Coca-Cola fruit Slice is a line of fruit-flavored

drink brand marketed in India soft drinks manufactured by
and Bangladesh. PepsiCo and introduced in

Limca is a lemon and lime Teem was a lemon-lime-

flavoured carbonated soft flavored soft drink produced
drink made in India by Coca- by The Pepsi-Cola Company.


• Pepsi has a broader product line and outstanding reputation.

• Merger of Quaker Oats produced synergy across the board.

• Record revenues and increasing market share.

• Lack of capital constraints (availability of large free cash flow).

• Great brands, strong distribution, innovative capabilities

• Number one maker of snacks, such as corn chips and potato chips

• PepsiCo sells three products through the same distribution channel.

For example, combining the production capabilities of Pepsi, Gatorade and

Tropicana is a big opportunity to reduce costs, improve efficiency and smooth
out the impact of seasonal fluctuations in demand for particular product.

• Pepsi hard to inspire vision and direction for large global company.

• Not all PepsiCo products bear the company name

• PepsiCo is far away from leader Coca-cola in the international market -

demand is highly elastic.

• Food division should expand internationally

• Noncarbonated drinks are the fastest-growing part of the industry

• There are increasing trend toward healthy foods

• Focus on most important customer trend - "Convenience".

• F&B industry is mature

• Pepsi is blamed for pesticide residues in their products in one of their most
promising 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 (because of broader product line) which are well-run and financially
sound competitors.

• Size of company will demand a varied marketing program; Social, cultural,

economic, political and governmental constrains.