Section One. Overview of the case:
On January 24, 1986, PepsiCo revealed that they had a plan to purchase the Seven-Up Company from Phillip Morris Companies, Inc. for $380 million. A month later this huge acquisition led to the Coca-Cola company proclaiming that they intended to purchase the Dr. Pepper Company for $470 million. During this time Coca-Cola was the leader in the soft drink market and held the largest market share of thirty eight percent (38.6% in 1986 to be exact). In comparison Pepsi was the number two supplier of soft drinks in the market and respectively trailed Coca-Cola with a market share of twenty seven percent (27.4% in 1986). Both companies greatly competed on price, which ultimately led to lower prices and amplified partnership in the soft drink industry. Price discounting and effective promotion and marketing were fundamental in distinguishing products within this highly competitive market. The ability to introduce new products also proved to be imperative in gaining market share as it is in any market if you want to be successful as a major market player or competitor.
As one could expect companies of smaller size and market share had difficulty surviving in this industry, and were poised for a buyout from a much larger holder in the market. An example of this was Seven-Up whom held a market share of six percent (6.3%). The proposed merger between Seven-Up and Pepsi would have brought Pepsi's market share up from twenty seven percent to almost
The soft drink industry has an oligopoly market structure, with PepsiCo and Coca-Cola being the two main competitors. Coca-Cola is #1 in soda sales, PepsiCo #2 and Dr. Pepper- Snapple #3. Other competitors in the beverage industry are Monster Beverage Corporation, Nestlé S.A., Red Bull GmbH, as well as local and regional companies such as 7-up, Jones Soda, Faygo and Town Club (“Pepsico Inc 's”, n.d). “Approximately 64% and 17% of Coca-Cola and PepsiCo’s valuation, respectively, comes from
In 1886, the Coca Cola Company was developed but it wasn 't until 1898 that the fierce competitor Pepsi-Cola entered into the market. These 2 companies are the two major players that dominate the consumer beverage (soft-drink) industry. Coke and Pepsi have since been competing to rein the global market in consumer beverages. The market of drinks in the United States alone is valued at more than thirty million dollars annually. With the growth of these two companies, PepsiCo has developed and acquired additional products outside the scope of just the consumer beverage industry, these products have helped the company to increase their exposure and position in the global market. This has not been the case for the Coca Cola Company; they
Pepsi Co 's assignment taken as a whole is to amplify the value of its shareholder 's investment through sales intensification, expenditure gearshift and prudent investment of resources (Bongiorno, 1996, p 71). In this pose, Pepsi believes that its moneymaking triumph depends on
1. What is PepsiCo’s corporate strategy? Briefly identify the business strategies that PepsiCo is using in each of its consumer business segments in 2008.
Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.
Coca-Cola had kept it’s recipe a trade secret for over 100 years. It has been kept in bank vaults with very stringent protocols as to who may have access to the written recipe. The people that Coca-Cola allow to have the knowledge of the recipe have signed non-disclosure statements. They can make the syrup but are not able to share the recipe. In 1925 the recipe went into the bank vault of Trust Company of Georgia. The bank may have changed names over the years but it still protected Coca-Cola’s recipe until 2011, when Coca-Cola moved the recipe to the vault they built to house the recipe.
The Coca-a-Cola company is huge and is involved in many different environmentally friendly programs. One of which is how they are giving back locally by providing clean water to less fortunate areas.
The beverage organization Coca Cola has established programs to create and support employee engagement throughout their organization. For Coca Cola to promote engagement, they relie on their local leaders to promote and support the work groups. For these leaders, extensive training has been established to improve areas of leadership that can inspire and create a positive work environment. These areas are also seen as areas of engagement that can impact of business results and is the important to employee empowerment. According to Xu and Helena, a impactful and direct correlation between the levels of engagement and leadership style is where the leadership is caring and nurturing to create a work environment that can be conducive in order to increase the levels of engagement (2011). The leadership training also works on leaders practicing behaviors that are directly related to engagement as part of the leader’s daily routines.
Pepsi-Cola is a carbonated beverage that is produced and manufactured by PepsiCo. It is sold in stores, restaurants and from vending machines. The drink was first made in the 1890s by pharmacist Caleb Bradham in New Bern, North Carolina. The brand was trademarked on June 16, 1903. There have been many Pepsi variants produced over the years since 1903, including Diet Pepsi, Crystal Pepsi, Pepsi Twist, Pepsi Max, Pepsi Samba, Pepsi Blue, Pepsi Gold, Pepsi Holiday Spice, Pepsi Jazz, Pepsi X (available in Finland and Brazil), Pepsi Next (available in Japan and South Korea), Pepsi Raw, Pepsi Retro in Mexico, Pepsi One, and Pepsi Ice Cucumber in Japan .Pepsi cola is situated is an Industry that is dominator by two Competitors Coca
In order for a community project to be successful, companies must engage with their communities. Coca-Cola representatives’ travel to the communities they serve, but typically the NGOs running the program on behalf of Coca-Cola do most of the interaction with the communities. Coca-Cola has strong relationships with the World Wildlife
1.) Why do companies like Pepsi need to globalize? What are the various ways in which foreign companies can enter a foreign market? What hurdles and problems did Pepsi Face when it tried to enter India during the 1980s?
Trade is increasingly global in scope today. There are several reasons for this. One significant reason is technological—because of improved transportation and communication opportunities today, trade is now more practical. Thus, consumers and businesses now have access to the very best products from many different countries. Increasingly
Pepsi-Cola is a carbonated beverage that is produced and manufactured by PepsiCo. It is sold in stores, restaurants and from vending machines. The drink was first made in the 1890s by pharmacist Caleb Bradham in New Bern, North Carolina. The brand was trademarked on June 16, 1903. There have been many Pepsi variants produced over the years since 1903, including Diet Pepsi, Crystal Pepsi, Pepsi Twist, Pepsi Max, Pepsi Samba, Pepsi Blue, Pepsi Gold, Pepsi Holiday Spice, Pepsi Jazz, Pepsi X (available in Finland and Brazil), Pepsi Next (available in Japan and South Korea), Pepsi Raw, Pepsi Retro in Mexico, Pepsi One, and Pepsi Ice Cucumber in Japan .Pepsi cola is situated is an Industry that is dominator by two Competitors Coca
Long before now has branding been considered as one of the peripheral aspects of business. Manufacturers, investors and other key players focused on the product without paying much attention to the consumer. But as the business landscape got tougher, marketing became not just an integral part of business but one of the fundamental principles of success.
The spinning off the restaurant divisions, in my opinion, is a success for PepsiCo. Although Yum! Brands has been a quite successful, thriving company with record setting growth and profitability, I would still support the decision today. PepsiCo had too many oars in the water with the beverage business, the snack business (Frito Lay) and the fast food restaurant business. It could not successfully manage all the diversity it had acquired. I commend the management team’s decision (led by, then President/CFO, Indra Nooyi and now Chairman/CEO) (Fox News 2012) to cut a highly potential part of its business off and to implement a strategy to focus on its main products and their distribution. This strategy has proved to be the right move for this organization. Below is a table which illustrates the fluctuations with the stock price from the first acquisition of Pizza Hut through October 31, 2014 (though the stock price posted on 11/3/2014). You can see that the acquisition years (in yellow) show a negative impact on the stock price, with two of the three being significant. You should also note that, in the year of divesture,