Pepsi Natural

Integrated Marketing Communications

Product Introduction
Pepsi Natural is a new, natural product offering that serves as a healthier alternative to the traditional Pepsi. Replaces the high fructose corn syrup traditionally found in Pepsi and other soft drinks with natural cane sugar. Ingredients include: cane sugar, kola nut extract, apple extract, coffee leaf, sparkling water, plain caramel coloring, tantaric acid from grapes and gum arabic from acacia tree.

Pepsi Natural: Sold in Four Packs

Pepsi Natural is running in ten test markets throughout the United States Its British cousin, Pepsi Raw, is running in seven test markets Pepsi Natural in Mexico has had a full product launch.

Company Profile
PepsiCo International is one of the largest international consumer foods companies. Currently, the company boasts annual revenue of $43 Billion dollars and employs over 198,000 people throughout the world.

Soft Drink Industry

In 2008, the soft drink industry in the Americas was valued at $63.2 Billion. The market value is expected to shrink to $61.4 Billion by 2013.

In the United States, Pepsi dominates 28.8% of the soft drink industrys market share.
Past advertising and marketing brand building efforts have established few, dominant leaders in this industry, where competition is fierce.

Major Competitors (Direct)

Zevia Oogav Red Bull Cola Boylans Coca-Cola

Major Competitors (Indirect)

Hansens Jones Izze
All these competitors are independent companies lacking the strong support and distribution power relative to Pepsi.

Current Marketing Mix-Abroad

Pepsi Raw in UK, already has print ads and promotional efforts made through food festivals. Pepsi Natural is also in Mexico and has already seen the implementation of an IMC campaign.

Current Marketing Mix-Abroad

Print Advertising Campaign for British version of Pepsi Natural, Pepsi Raw:

Current Marketing Mix-Abroad

Example of Mexicos Pepsi Natural advertisement.

Market Segmentation, Targeting, and Positioning

Because the product is in the introductory stage in the United States there has been little promotional effort or STP. Only in major metropolitan areas to test the attractiveness of the product to the American Public.

Product is currently being positioned as a natural alternative to regular Pepsi or other soft drinks.

Current Marketing Mix-Domestic

In 2008, Pepsi spent $177 Million on media U.S. media expenditures (not including online media). Product Price Place Promotion

New IMC Campaign

Integrated Marketing Communications

Market Segmentation, Targeting, and Positioning

Concentrated segmentation strategy Benefit segmentation Attractiveness

Identifiable Substantial Reachable Responsive Profitable Positioning new, unique, accessible all natural soft drink from a trusted, popular, well-known brand

Relevant Consumer Behavior

The VBN (Value Belief Norm) theory.
Theory suggests that consumers begin purchasing organic foods because of a belief that these foods are better for their health.

Relevant Consumer Behavior

Consumer involvement typically higher for organic foods Word of Mouth appears to be the most important source of influence on the purchasing of food products. Consumption behaviors

Despite purchasing natural and organic brands consumers lean toward natural product offerings from more mainstream and trusted brands.

Relevant Consumer Behavior

Despite the weak economy, organic consumers are still buying relatively more expensive natural products than unnatural or processed products. To do this, these loyal consumers are changing their buying habits, including using coupons. 46% of natural foods consumers say that they will buy the same amount of natural foods after economy rebounds and 36% say they will buy even more.

Target Market Information

Basic demographic structure: Market expanding into various demographic groups and ages Parents that wish to feed their families unprocessed foods College-educated, financially stable consumers Women also buy organics more

Target Market Information

Reasons why this is an effective target market: Recent trend increasing interest and desire for natural and organic foods, due to heavier emphasis on healthier lifestyles. Backlash over High Fructose Corn Syrup Heightened public health concerns Enduring Green movement

New IMC Campaign

Pepsi Natural nationwide product launch. Primary objective : to raise brand awareness and loyalty among organic consumers.

General IMC Objectives

Communications Objectives
Increase product awareness/recognition Create unique product image To build consumer loyalty

Sales Objective
To obtain significant market share within the natural soda market

Emphasis on print ads and interactive media.

Communication Process
Innovation Adoption Model Stage in model: to raise awareness = primary focus
Cognitive stage

Desired Response by trying, buying, purchasing, becoming loyal, positive word of mouth, repeat purchaser. Implications Principle focus of campaign to raise awareness to promote purchase and positive word of mouth.

Communication Elements
Source, message and channel decisions

Source Message Channel

Basic creative strategy theme: emphasis on natural aspect of drink, simplistic message, use of natural, earth tone colors.

Appeal and Execution Style

Use of natural colors to emphasize natural components of the product Informational appeal info about ingredients and why product is beneficial Feature appeal Straight sale execution Imagery execution

Media Objectives
Objectives
To create product awareness Encourage trial

Use of broadcast and print media.

Media Schedule Continuity

Broadcast Media
Use of TV and Radio and Why?
Using TV commercials because they reach a broader audience which supports a national product launch, cost effective, selectivity

Specific Programs and Why?

Stations that focus on health and parenting.

Use of 15 second TV commercials

Broadcast Media
Advertisement Mock-Up (See PowerPoint)

Print Media
Print ads in organic/natural lifestyle publications

Natural Health Magazine, Natural Home, Natural Solutions Vegetarian Times

Print ads in organic/natural lifestyle publications

Parenting, Family Circle, motherhood oriented publications

Print Media

Support Media
High reach and high frequency media. Breaks through clutter and catches attention.

Difficult to avoid.
Use of outdoor and transit media.
Billboards Bio-Diesel Buses

Support Media

Support Media

Support Media

Direct & Interactive Marketing

Direct marketing not used because of issues associated with product/brand image. Pepsi is a well known and respected brand. Development of multifaceted website.
Higher education, higher income Coupons

Direct & Interactive Marketing

Sales Promotions
Sales Promotions Objectives
No risk incentive Shaping Build brand equity Target specific segments

Coordination with other sales promotion elements

Pairing with coupons

Sales Promotions

Public Relations
No need to manage brand image Already extensive press coverage on new, high profile all natural offering from a major soda manufacturer. (no need for buzz) Talking down to consumer, already aware of benefits of organic products, high product/purchase involvement.

PR has the potential of communication problems with the misinterpretation of the source message.

Personal Selling
Reserved for high profile, high involvement, more expensive products with several alternatives Limited reach

Relevant International, Social Issues

High Fructose Corn Syrup backlash?
Sugar, though less processed and ultimately more natural, is deemed just as harmful as HFCS.

Potential to be labeled as trend product.

Conclusion
Review of product Review of Target Market Review of Marketing Mix