Marketng 1001 Introduction To Marketing Assessment Answers

Being a true global company, PepsiCo has a diversified multi-cultured and multi-faceted external environment.

Manufacturing and distribution process of PepsiCo is subject to different countries’ state law and political group’s influences. The concern of state government, central government of different countries is different. In such situation PepsiCo has clearly define its manufacturing process and distribution process in accordance with state law.

Regarding economic factors, PepsiCo face multi-currency and multi-country issues. It has to decide and design the pricing of it products according to the economic aspect of the country in consideration. Global fluctuations in fuel prices, increasing foreign exchange differentiations and global economic regression are somehow impacting policies of PepsiCo (Belch and Belch, 2014).

Through differentiated social environment, PepsiCo has an opportunity to serve a broad range of customer group. Different cultures, sub-cultures are guiding PepsiCo in developing their marketing strategies. These factors impact the advertising policies and campaigns. Also, concerns to environmental issues are increasing in global context. Thus PepsiCo has to consider different country specific environmental issues.

Increasing focus on social media, digital content are given the opportunity to reach targeted customers in a more cost effective manner. The targeted audience can be reached in a better way through use of technology in marketing adoption (Ritter, 2014).      

Internal Environment

The internal environment of PepsiCo is giving the core competencies to serve its customers globally in a better way. PepsiCo employees through-out their value chain are well trained to serve customers in a better manner. Increased customer satisfaction of PepsiCo is due its well-trained employees. The multi-cultured employees bring a sense of diversity in serving clients for PepsiCo. PepsiCo has near about 264000 employees globally and employing 11300 employees in USA only. The employment level is subject to seasonality of the business (PepsiCo, 2016).

It has a variety of customer groups such as wholesalers, distributers, drug stores, foodservice customers, grocery stores, mass merchandisers, convenience stores, discount/dollar stores, membership stores, e-commerce retailers and authorized independent bottlers. PepsiCo provides financial assistance to its customers to support in their selling, distribution and promotion activities. It certainly enables the company to achieve more revenue targets (Ritter, 2014).

Their marketing support activities like retailer incentive plan, product placement support activities, vending and cooler equipment support to retailer and distributor, market place support and point of purchase material support has helped its unique marketing operations to grow its supply chain.

PepsiCo deal in a highly competitive business environment globally. The Coca-Coal company is their primary competitor in business operations from customer point of view. Also in beverage section their competition is with different industry player such as Kellogg Company, DPSG, Mondelez International, Inc., Monster Beverage Corporation, Nestlé S.A., The Kraft Heinz Company, Red Bull GmbH and Snyder’s-Lance, Inc. PepsiCo hold a leadership position in its different product category in USA and globally. Their unique marketing activities have provided them with better customer loyalty and brand recognition (Belch and Belch, 2014).

PepsiCo has its own research and development activities in global context. Their most product innovations are mostly consumer focused and safe for health and wellness aspect. PepsiCo has its different research centres located in different countries like the United Arab Emirates, China, India, Brazil, Mexico, Russia, the United Kingdom and the United States. Their unique research and development activities are a better combination of food science, nutrition science, and engineering and consumer insights.  They have more focused future plan to develop nutritious and convenient beverages, foods and snacks products for their customer group globally through their state of the art research and development (Kozlenkova, Samaha and Palmatier, 2014).

To confirm with global standards and policies PepsiCo is always working for the better safety policy, employee benefits policy, providing better working environment for their employees. It also ensures that its contractors also maintain the same standards in operations.

Shareholders of PepsiCo are always appreciated with better financial performance and systematic dividend policies. The availability transparent financial information is providing better confidence in investors and enabling the global investors’ confidence. Being global company and aligned to its organisational objectives; PepsiCo’s approach to serve its investors in a better approach provides its financial support from its trusted long term investors (Krasnikov and Jayachandran, 2013).

The government is also a consideration part of its broad marketing aspect as they are policy makers of market. The different government has different aspect of thinking in treating corporate, thus having presence in diffident countries; PepsiCo has to deal with different government in different manner (Schilke, Reimann and Thomas, 2013).  

In realistic approach, PepsiCo has to motivate its retailers, wholesalers and distributors in different way in different countries. It has to plan, design and implement different marketing programs in different country in different manner.

Thus, PepsiCo has also a very dynamic internal environment in which it has to operate in such a manner that it can produce and achieve the best possible outcome.

SWOT of PepsiCo    

PepsiCo, being a global company and serving a global customer base; is surrounded by a unique and diversified macro and micro environment. The environment is provided with unique strengths, weaknesses, opportunities and threats.

PepsiCo has strong global presence and loyal global customer base. It has most appealing branding and packaging in different countries in different manner. The product portfolio is very much attracted to the new generation globally. Their strong supply chain network provides the unique strengths to serve geographically scattered customers in a timely manner. Their continuous product innovation in context with taste, preference, safety always place PepsiCo as consumer oriented company globally. It has always shown a better cultural respect through its advertisement campaigns globally. Their well-planned distribution network is a competitive advantage for their service delivery. Their product is globally well accepted due to superior quality of taste. Their huge distributor base, retailer base through-out geographies enabled PepsiCo become a market leader (Santos and Laczniak, 2015).

PepsiCo is facing brutal competition in the markets where Coca-Cola is the market leader. It has found very hard to enter those markets and also after entering, achieving the sales market. Customers are influenced by the better product serving and availability from Coca-Cola. Also in some market PepsiCo lack novelty in their marketing campaigns. Huge competition from established market leaders, PepsiCo found itself for cash bleed position in different geographies. It certainly impacts the overall performance of PepsiCo globally (Pavlou and Stewart, 2015).

PepsiCo is company which has created opportunities for itself through a globally unique strategy. It has entered the untapped market with well-planned mergers and acquisitions. PepsiCo is a company which has true presence in global markets and serving a broad customer base. Also increasing youth customer base is an opportunity for PepsiCo in global aspect. The multi-dimensional cultural factors, broad demographical factors and broad market base are providing sea of opportunity for PepsiCo. The global market context is providing an opportunity for PepsiCo to grow in multi-fold (Zhou, Poon and Wang, 2015).

PepsiCo is facing different threats in different markets. The different geographical, political and governmental factors are creating certain opportunities and along with all these created some threats also. PepsiCo has now facing different threats as in market different substitutes are available. Also, consumers are becoming more health conscious and the market for carbonated soft drinks are decreasing due to global impact factors. The consumers also concerned about environmental degradation in huge water usage in soft drink production (Gopaldas, 2015).

The demanding customer, governing governmental pressure, political influence, and social groups’ considerations are creating sea of opportunities along with threats. It has distinct strengths in different markets which will enable its market leadership in more solid manner. Its weakness will guide in developing more strategic vision for serving customers. 

Recommendations

The above discussed marketing environmental aspects, SWOT analysis provides PepsiCo a broad aspect of recommendations in deciding about its target market, new product development and marketing mix strategies.  

Target Market

It has well diversified target market as North America, Latin America, Europe, Sub-Saharan Africa, Middle East, North Africa and Asia depending on the broad geographical segmentation. Also it has targeted its customer base on the basis of its product offering such as Frito-Lay, Quaker Foods, and Beverages products. The target market is more precisely developed by PepsiCo on the basis of age groups namely for kids, for youth, for aged and for old age customer base. It can increase its customer base through increasing the target market criteria. The market consideration, continuous market insights from its sales team, PepsiCo has enabled its strategic vision to serve more customer base in such a manner so that it can create a loyal customer base (Urde and Koch, 2014).       

New Product and New Service Description

PepsiCo has a well-planned product portfolio which consists of well-known and well-valuable brands of $1 Billion. Their highly complementary product portfolio made its position as number one in salty snacks in worldwide market. It has also gained a strong position globally in beverages market as global leader number two. It has ensured its commendable 4% year on year organic growth through a well-balanced product portfolio (Kraiczy, Hack and Kellermanns, 2014). It has extended its product portfolio through its Tropicana essentials, Quaker products, Simply Snacks from Frito-Lay and Sabra Spreads. Its iconic brand includes Pepsi, which broadly included three products such as Pepsi, Diet Pepsi and Pepsi MAX. In sports nutrition product portfolio, it has Gatorade's brand. It can increase its product portfolio with new flavours, mew and packaging styles. Also, service portfolio can be increased through broad range offerings to retailers, distributors and wholesalers (Blankson et al., 2013).     

Marketing Mix Strategies

PepsiCo has designed its marketing mix in a strategic manner so that it can serve its customers in a cost effective manner. It has products category like beverage products, Savoury Food Snacks, breakfast cereals, cakes and cake mixes and Baked Snacks. The broad product offerings have provided PepsiCo a better opportunity of marketing serving. The expenses regarding transportation, labour and ingredients has increased the pressure of increased price (Sinapuelas, Wang and Bohlmann, 2015). But PepsiCo has priced its products low with partnership with Wal-Mart. PepsiCo can reduce its overheads and expenses to reduce its cost of products and can serve more customer base. The market which is served by PepsiCo is global and huge in size. It has planned its placing strategies with consideration of it supply chain. It can enter into the untapped market with its old and evergreen approach of merger and acquisition strategy. PepsiCo has its unique stuff promotion policies, Pepsi Throwback promotion, and promotion in different global events; made PepsiCo a well-articulated brand image and recognition. Its website provides better physical evidence to its customers. The trained people of PepsiCo are the strategic asset for its business operations (van den Driest and Weed, 2014).   

Conclusion 

In conclusion it can be said that marketing strategy of PepsiCo is well-planed and made its approach to become global leader as more achievable. Its marketing approach in digital age and globalised business aspect is truly commendable (Walsh, Shiu, and Hassan, 2014).   

References

Ritter, J., 2014. " What is the role of marketing in strategic planning"?. The Business & Management Review, 4(4), p.88.

PepsiCo 2016. Annual Report 2016 Retrieved 15 September 2017, from https://www.pepsico.com/docs/album/annual-reports/pepsico-inc-2016-annual-report.pdf

PepsiCo 2017. Global Brands Retrieved 15 September 2017, from https://www.pepsico.com/company/global-brands

Dawson, J.A., 2014. The Marketing Environment (RLE Marketing)(Vol. 1). Routledge.

PepsiCo 2017. Our History Retrieved 15 September 2017, from https://www.pepsico.com/Company/Our-History

Belch, G. and Belch, M., 2014. The role of new and traditional media in the rapidly changing marketing communications environment. International Journal of Strategic Innovative Marketing, 1(3), pp.130-136.

Kozlenkova, I.V., Samaha, S.A. and Palmatier, R.W., 2014. Resource-based theory in marketing. Journal of the Academy of Marketing Science, 42(1), pp.1-21.

Krasnikov, A. and Jayachandran, S., 2013, May. The relative impact of marketing, research-and-development, and operations capabilities on firm performance. American Marketing Association.

Schilke, O., Reimann, M. and Thomas, J.S., 2013, May. When does international marketing standardization matter to firm performance?. American Marketing Association.

Santos, N. and Laczniak, G., 2015. Marketing to the poor: A SWOT analysis of the Market Construction Model for engaging impoverished market segments. Social Business, 5(2).

David, M.E., David, F.R. and David, F.R., 2017. The quantitative strategic planning matrix: a new marketing tool. Journal of Strategic Marketing, 25(4), pp.342-352.

Urde, M. and Koch, C., 2014. Market and brand-oriented schools of positioning. Journal of Product & Brand Management, 23(7), pp.478-490.

Blankson, C., Cowan, K., Crawford, J., Kalafatis, S., Singh, J. and Coffie, S., 2013. A review of the relationships and impact of market orientation and market positioning on organisational performance. Journal of Strategic Marketing, 21(6), pp.499-512.

Kraiczy, N.D., Hack, A. and Kellermanns, F.W., 2014. New product portfolio performance in family firms. Journal of Business Research, 67(6), pp.1065-1073.

Pavlou, P.A. and Stewart, D.W., 2015. Interactive advertising: A new conceptual framework towards integrating elements of the marketing mix. In New Meanings for Marketing in a New Millennium (pp. 218-222). Springer, Cham.

Sinapuelas, I.C.S., Wang, H.M.D. and Bohlmann, J.D., 2015. The interplay of innovation, brand, and marketing mix variables in line extensions. Journal of the Academy of Marketing Science, 43(5), pp.558-573.

van den Driest, F. and Weed, K., 2014. The ultimate marketing machine. Harvard Business Review, 92, pp.54-63.

Gopaldas, A., 2015. Creating firm, customer, and societal value: Toward a theory of positive marketing. Journal of Business Research, 68(12), pp.2446-2451.

Zhou, L., Poon, P. and Wang, H., 2015. Consumers' reactions to global versus local advertising appeals: A test of culturally incongruent images in China. Journal of Business Research, 68(3), pp.561-568.

Walsh, G., Shiu, E. and Hassan, L.M., 2014. Cross-national advertising and behavioral intentions: A multilevel analysis. Journal of International Marketing, 22(1), pp.77-98.