PROJECT ON DISTRIBUTION OF PEPESI IN MADURAI

Submitted by,
S. Jaya Christ
Loganathan
Saravanan
Shaishyam

COMPANY PROFILE:
The Pepsi cola company began in 1898, but it only became known as PepsiCo when it
merged with Frito lay in 1965. The brand was trademarked on June 16, 1903, though
pharmacist celeb Braham first made the drink on august 28, 1898. . At the time of its
foundation, PepsiCo was incorporated in the state of Delaware and headquartered in
Manhattan, New York. The company's headquarters was relocated to its still-current location
of Purchase, New York in 1970, and in 1986 PepsiCo was reincorporated in the state of North
Carolina. Tropicana was acquired in 1998 and PepsiCo merged with The Quaker Oats
Company, including Gatorade, in 2001. PepsiCo now produces and markets nearly 200
refreshment beverages to retail, restaurants and food service customers in more than 190
countries and territories around the world and generates revenue of over 18 billion dollars.
PepsiCo is now a world leader in convenient foods and beverages, with revenues of about
$66.50 billion, over 2,74,000 employees and total equity $20.899 billion.

Many of PepsiCo's brand names are over 100-years-old, but the corporation is relatively
young. The beverages segment primarily market Pepsi diet, mountain dew and other brands
worldwide and 7UP outside the U.S. market. As of January 26, 2012, 22 of PepsiCo's brands
generated retail sales of more than $1 billion each individually. Those products are Pepsi,
Mountain Dew, Lays, Gatorade, Tropicana, 7 Up, Doritos, Lipton Teas, Quaker Foods,
Cheetos, Mirinda, Ruffles, Aquafina, Pepsi Max, Tostitos, Sierra Mist, Fritos, and Walkers.
They are positioned in close competition with Coca-Cola Inc. of USA. PepsiCo s success is
the result of superior products, high standards of performance, distinctive competitive
strategies and the high integrity of the people. PepsiCo entered India in 1989 and has grown
to become one of the largest food and beverage businesses in India. PepsiCo India has been
consistently investing in the country and has built an expansive beverage and snack food
business with 38 beverage bottling plants and 3 food plants. PepsiCo India s portfolio
includes iconic brands like Pepsi, Lays, Kurkure, Tropicana 100%, Gatorade and Quaker.
The company has built eight INR 1000 crore plus brands in India, which are household
names trusted across the country. PepsiCo and its partners recently announced an additional
targeted investment of Rs. 33,000 crore in India by 2020 in the areas of product innovation,
increasing manufacturing capacity, strengthening supply chain and expanding companys
agriculture programme.
PepsiCo follows the commitment called Performance with Purpose which denotes the
PepsiCos promise to provide a wide range of foods and beverages for local tastes, to find
out innovative ways to minimize the impact on the environment by conserving energy and
water and to provide a great workplace for the associates, and to respect, support and invest
in the local communities where they operate.

Marketing Mix in relation to PepsiCo:

Product:
Pepsi offers variety of products to satisfy the customers with taste and quality and the
company's current products lines include several hundred brands. PepsiCo Indias product
portfolio includes refreshment beverages Pepsi, 7up, Mirinda, Slice, Mountain Dew and
Nimbooz, in addition to low-calorie options such as Diet Pepsi, hydrating and nutritional
beverages such as Aquafina drinking water, sports drink Gatorade and fruit juices such as
Tropicana and Tropicana 100%.
Slice was launched in India in 1993 as a refreshing mango drink and quickly went on to
become a leading player in the category. In India and Pakistan, Slice is a mango flavoured
soft drink under the PepsiCo brand and can be bought in any general grocery store and other
eateries, catering shops. It contains mango and Alphonso mango pulp of 13%. Slice has
launched 3 new exciting flavours giving Indian consumers an experience of their favourite
mango varieties from across the country. These 3 limited edition mango offerings from Slice
include the sweet and golden Banganapalli from the South, the juicy Kesar from Gujarat and
the
royal
Dussehri
from
Lucknow.

Place:

Another major component of marketing mix is place. Marketing channels are the medium
that create customer access to company products. Distribution is the link between
manufacturer and customer.
Channel Cluster:
(A) Grocery store
Grocery (customer profile): Store stocking a variety of regular uses household items. The
channels provide an opportunity for penetration as it propels home consumption. It includes
all juice, departmental stores, supermarkets, provision stores etc.
(B) Eating & drinking channel 1:
Eating and Drinking Channel: Outlets range from the high-end restaurants to the smaller
dhabas. These outlets offer multiple opportunities to effect sales as people usually order
something to drink along with food. It includes restaurant, bars and Pubs, dhabas, bakery and
Cafes.

Pattern of Distribution:
There are different patterns of distribution and PepsiCo follows intensive distribution.This
kind of distribution makes sure that the product is made available in as many outlets as
possible so that anywhere the consumer goes, he will be able to get the product of his choice.
It ensures widespread coverage, volumes and availability. As final consumers are large in
number it provides convenience to them. This system helps increase coverage and sales and
hence it is most suitable for beverage industry like PepsiCo. The outlets are also classified
based on volume of sales.

Price:
Providing quality products at the lowest possible price is always the most important thing for
Pepsi. Pepsi gives promotional discounts as well as discounts on bulk buying. For
distributors, the discount is based on the quantity as well as the payment terms. The better the

payment terms or the higher the quantity, the more is the discount given thereby keeping the
distributor motivated. However, Pepsi has to lower its price for the top retailers and bulk
buyers. For example Indian retailers like Big Bazaar, Reliance fresh, as well as hyper city
are bulk buyers. Similarly fast food chains like KFC are also bulk buyers. These bulk buyers
negotiate with the soft drink brands on the basis of price and sell their products in huge
quantities. Thus, Pepsi has to drop prices in these places. The margins of the company are
better through the distributors and lesser through bulk buyers. However, the sales of the
company are higher to bulk buyers as compared to distributors.
Promotion:
Pepsi promotes its products in many ways, but focuses mainly on getting products associated
with entertainment icons that appeal to youth. Two other areas of entertainment that have
been used by Pepsi to promote its brands are sports and movies. Sports are a popular source
of entertainment throughout the world and using it to promote the brand is the main focus of
Pepsi. Since sporting events are seen many times by fans, it provides a good opportunity to
increase brand recognition. Pepsi sponsors sports teams as a part of their marketing
campaign. Pepsi also became the new title sponsors of the Indian Premier League with a huge
winning bid of Rs 396.8 crores for the next five seasons starting from 2013. Movie stars are
also popular throughout the world and are greatly admired by people, so using them in
advertising has a positive effect brand image. Pepsi uses both push and pull strategies for
promoting their products. Consumer promotion: It used pull strategy by means of advertising
and consumer promotion. Pepsi in Association with Free charge provided offering of Rs.20
free recharge while buying of PepsiCo products 1lt or more for Pepsi, 7up, Mirinda,
Mountain Dew and Slice 1.2 litre pack. In 2008, Slice was relaunched with a winning product
formulation that made consumers fall in love with its taste. With the launch of the
Aamsutra campaign in 2008, its winning taste and appealing pack graphics, Slice created a
great deal of excitement in its category and celebrated the fulfillment in mangoes like no
other brand had done before.
While other players have portrayed the mango as a simple and innocent fruit, Slice celebrates
the sheer indulgence and sensuality involved in consuming a mango. Slice was the first brand
ever in the Juice and Juice Drinks category to sign on Bollywood movie star Katrina Kaif as
the brand ambassador for Slice. Slice took the notion of indulgence to a whole new level with
the launch of the Slice Pure Pleasure Holidays, giving its consumers a chance to win
luxurious all-expenses-paid holidays to dream European destinations like Paris, Vienna,
Greece and Venice. Trade promotion: Pepsi follows push strategy which make the
intermediaries to carry, promote & sell companys products to the consumers. The company
comes up with several incentive schemes for the retailers. They provide retailers with point of
purchase displays like racks, stands & aisle displays, banners, boards, etc and also provide
them with special volume discounts and free gifts.

MARKETING CHANNELS
2-LEVEL CHANNEL
The 2-Level channel is company to manage the business and reduce the high risk
adopts the most suitable marketing channel for N.B.P.L PEPSI CO. this channel.
In this channel company main work is to manufacturing the products and promoting
the products to the wholesalers. Here the wholesaler is the main key for the companys
business growth.
This channel makes it easy for the customers to purchase product, but by providing
greater service output which increases channel costs and there by increases prices for
customers.
So 2-level channel which correlates with companys market functioning.

MANUFACTURER

WHOLESALER

RETAILER
CONSUMER (End
User)

FUNCTION OF MARKETING CHANNEL

A marketing channel performs the work of moving goods from producers to
consumers. And its key functions are;

 It gathers information about potential and current customers, competitors, and other
factors and forces in the marketing environment.
It develops and disseminates persuasive communications to stimulate purchasing.
It reaches agreements on price and other terms so that transfer of ownership or
possession can be affected.
It place orders with manufacturers.
It acquires the funds to finance inventories at different levels in the marketing
channel.
It assumes risks connected with carrying out channel work.
It provides for the successive storage and movement of physical products.
It provides for buyers payment of their bills through banks and other financial
institutions.
It over sees the actual transfer of ownership from one organization or person to
another.

Markets:
The major market segments are
-

Bars and wine centers.

Students in soft drinks houses, restaurants, convenience stores.

Families that like to store pet bottles.

Competitors:
The major competitor is Coca-Cola along with local/unorganized sector.
Pepsi Co. Brands

Competitors

Pepsi

Coke,bovonto

7-up

Thums up

Mountain Dew

Sprite, kalimark

7up Ice

Citra

Mirinda Orange

Fanta

Mirinds Lemon

Limca

Slice

Maaza

Evervess Soda

Kinley(water)

Teem Soda

Kalimark

Distribution and dealers:

The three main channels to reach the consumers are
Production Unit

Distributor

convenience
Store

Groceries
-General
stores

Pan shops

Distributor

Restaurants
-Bars
-Cool drink house
-Restaurants

Bakeries

-Canteens

Theaters

Consumers

Empty