BSIT 4TH on PEPSI

8/7/2019 BSIT 4TH on PEPSI

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Pepsi Cola International

Pepsi Cola Company includes in beverages industry. Pepsi Cola

international is well reputed multinational company which is doing its

business in almost every country of the world. The company is

registered in New York stock exchange U.S.A. to make a better

control over the business the company has given the manufacturing

rights to different companies. Now these companies are producing

the products on the behalf of the company by using their trademark.

To maintain their goodwill in the market the company has a strict

policy while granting the manufacturing rights Pepsi-Cola have

standardized products all over the world (e.g, same in size, shape

and quality). The franchises have to follow all the standards as given

by the company. Even they have the mobile team, which check the

company after 2 or 3 months. Either company is producing products

according to the standerds given by the Pepsi Cola international.

Principles of Marketing 1


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Shamim & company

History:Shemim & company was established in 1967 as a private limited

company. It started its business in 1968. Allah Nawaz Khan Tareen

(Ret. DIG) got licensee of 7-up franchise and was producing only

one product, 7-up. But in 1973, it became Pepsi Cola franchise. Now

a days MD of Shamim and Company is Allah Din Khan Tareen.

Introduction

In Pakistan, at present shemim & company is the largest production

unit out of these 11. Shamim & company covers the area of Southern

Punjab which consist of Multan, Bahawalpur, Bahwalnagar, Dera

Ghazi Khan, Sahiwal, Khenewl, Rajan Pur, Mianwali and Layyah. The

company is properly serving all these areas with quality products.

Mission Statement

To earn profit by meeting the customers needs with quality products.



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Departments

For effective control & to serve these areas more properly the

company has the following departments.

Production Department

This department is responsible for the production of the products

according to the requirements of the customers.

Administration & Personal Department

Administration & personal department deals with the overall matters

of the company and takes different actions for increasing the

performance of the company. This department also carries out

different benefits programs.

Sales / Marketing Department

This department makes different efforts to increase the sales of the

company by sponsoring different social programs and by advertising

their products.

In marketing department, 6 regional sales manager, 19 divisional

sales managers, 15 area sales manager, 90 sales officers and

supervisor.



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Finance Department

It deals with the financial matters of the company. It collect the

revenues and makes different payments and maintain proper record

of the financial performance of the companys business to show the

net result in the form of either profit or loss.

General Manager

G. Manager of each department is responsible for the performance of

his department. To carry out his duties more efficiently he has

assistant manager in charges who help him to perform his duties

successfully.

General Manager Operation

To whom report is provided by manager of administration shippings

manager and workshops manager.

G. Manager Of Technical

Shift incharges, shift chemists and lower level operating employeesreport to G. Manager technical.



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G. Manager Finance

Financial accountant, management Accountant and manager of

management Of information system report to G. Manager finance.

In Pakistan, Shamim & Company is among of top three out of eleven,

in terms size. When frenchise cross a certain volume, plant is

classified as, maga plant status Pepsi Cola has achieved in 2000.

Organizational structure


CEO(Chief Executive Officer)

COO(Chief Operating Officer)

G.M Sales G.M Operation G.M Financial G.M Fianance

Businessdevelopment

managers6 RSM 19 DSM 15 ASM

90Supervisor


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Objective

To maintain market leadership and to increase market sales. Pepsi

Cola is in Pakistan as compared to its competitors according to

Shamim & company we have to place our position or top whenever

we make policies leaders keep in mind that me are number one in

current market position.

ProductPlanning

Product planning is systematic decision making relating to are

aspects of the development and management of a firms product

including branding and packaging. Each product consist of a bundleof attributes (Features, Functions, benefits and uses) capable of

exchange or use, usually a mix of tangible and intangible forms.

Product

A product may be an idea , a physical entity( a good) or a service or

any combination of the three. It exists for the purpose of exchange in

the satisfaction of individual and organizational objectives.



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Ways of product according to firm definitionThere are three ways of the product according to the firm definition.

a) Tangible product / actual product

b) Augmented product.

c) Generic product.

A tangible product is a basic physical entity, service or idea. It has

precise specifications and is offered under a given description or

model number.

Features / Characteristics Of Tangible ProductColor, style, taste, size, weight, durability quality of construction and

efficiency in use one the some tangible product features.

Actual product has 5 characteristics.

Quality level

Features Design

Brand name

Packaging

Example Of Tangible ProductPepsi Cola its name, parts, styling, features, packaging and other

attributes have all been combined carefully to deliver the core benefit.



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Augmented Product

It includes not only the tangible elements of a product but also the

accompanying cluster of image and service features.

Generic Product

Focuses on what a product means to the customer, not the seller. It

is the broadest definition and is consistent with the marketing

concept.

Classification Of Goods

We can classify the goods into 2 classes.

1) Consumer products

2) Industrial products.

Consumer Products

Consumer products are final consumer goods and services. The use

of the goods or service designates it as a consumer product.

Category Of The Consumer ProductThere are three categories of the consumer product.

1) Convenience product.

2) Shopping product

3) Specialty product



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1) Attribute based shopping products.

2) Price based shopping products.

Attribute Based Shopping Products

With the attribute based shopping products, consumers get the

information and then evaluated product features, warranties,

performance, options and other factors.

Price Based Shopping Products

In case of price based shopping products, consumers judge product

attributes to be similar and look around for the least expensive item.

Specially Products

Especially products are the particulars brands, stores and persons to

which consumer are loyal. Consumer is fully aware of their products

and their attributes prior to making a purchase decision. They arewilling to make a significance effort to acquire a brand desired and

will pay a higher price than competitive products, if necessary. In

specially products, substitute are not acceptable.

Unsought Product

Unsought product that the consumer is not yet aware of or a product

that the consumer is aware of but does not want right now.



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Consumer Product

Pepsi Colas product is included in consumer product and came

under the category of specially product about which the consumers

are fully aware and are completely loyal with it.

Industrial / Business Products

Industrial products are the goods and services purchased for use in

production of other goods and services in the operation of a business,

or for resale to other consumer.

Items included in industrial products.

Raw material

Fabricating material and parts

Installations

Accessory equipment

Operating supplies

Raw Material

Business goods that become part of another tangible product prior to

being processed in any way are considered raw materials.

raw material includes

Goods found in their natural state, such as minerals, land, and

products of the forests and seas.

Agricultural products such as cotton, fruits, livestock and animal

products including egg and raw milk.



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Fabricating Material And PartsBusiness goods that become part of the finished product after having

been processed to same extent fit into the category of fabricating

material and parts.

InstallationManufactured products that are an organizations major expensive

and long lived equipment are termed as installation.

Accessory EquipmentTangible products that have substantial value and are used in an

organizations operations are called accessory equipment. This

category of business goods neither becomes an actual part of

finished product nor has a significant impact on the organizations

scale of operations.

Operating SuppliesBusiness goods by low dollar value per unit, a short life, and aid in an

organizations operations without becoming part of the finished

product are called operating supplies.

Element Of Product Mix

Product item

Product line

Product mix



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Product ItemProduct item is a specific model, bran, size of a product that a

company sells.

Product lineA group of products that are closely related because they function in

a similar manner, are sold to the same customer groups, are

marketed through the same types of outlets, or fall within given price

ranges.

Product MixA product mix is the set of all products offered for sale by a company.

The structure of a product mix has both breadth and depth.

Breadth

Breadth is measured by the number of product lines carried.

Depth

Depth of the product mix is defined by the variety of sizes, colors and

models offered within each product line.

Pepsi Cola



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Beverages have four product lines with the name of Pepsi Cola

Mirinda, Team and Seven up and its product mix also consist of there

four product lines which shows the width / breadth ofPepsi Cola.

Its depth includes one product item and one product line in the form

of Pepsi Seven Up, Mrinda And Team.

New Product Development Strategy

The development of original products, product improvements, product

modification and new brands through the firms own research and

development efforts.

The stages in the new product development.

Stages In Product Development

1) Idea generation

2) Idea screening

3) Concept development and testing

4) Marketing strategy

5) Business analysis

6) Product development

7) Test marketing

8) Commercialization

Idea GenerationNew product development stars with the idea generation which is

defined as the systematic search for new product ideas. A company



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typically has to generate many ideas in order to find a new goods

ones.

Concept TestingTesting new product concepts with a group of target consumer to find

out if the concepts have strong consumer appeal.

Marketing Strategy DevelopmentDesigning an initial marketing strategy for a new product based on

the product concepts.

Business AnalysisA review of the sales, costs and profit projections for a new to find out

whether these factors satisfy the companys objectives.

Product Development

Developing the product concept into a physical product in order toassure that the product idea can be turned into a workable product.

Test MarketingThe stage of new product development in which the product and

marketing program are tested in more realistic and market setting.

Control Test Marketing

Several research firms keep controlled panels of stores that have

agreed to carry new products for a fee.



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Simulated Test Markets

Companies can also test new products in a simulated shopping

environment. The company or research firm shows ads and

promotions for a variety of products, including the new product being

tested, to a sample of consumers.

CommercializationTest marketing gives management the introduction needed to make a

final decision about whether to launch the new products the

companies goes ahead with commercialization. It means introducing

a new product into the market.

Product Life Lyele Strategies

The course of a products sales and profits over its life time it involves

five distinct stages.

1) Product development2) Introduction

3) Growth

4) Maturity

5) Decline

Product DevelopmentIt begins when the company finds and develops a new product idea

during product development, sales are zero and the companys

investment costs mount.



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Introduction StageThe product life cycle stage in which the new product is first

distributed and made available for purchase.

Growth StageThe product life cycle stage in which a products sales start climbing

quickly.

Maturity StageThe stage in the product life cycle in which sales growth slows or

levels off.

Decline StageThe product life cycle stage in which a products sales decline.

With the reference of the product life cycle, they says that their

product is still at the maturity stage and will never came to the decline

and they say that they are trying to retain this product maturity levelby increasing their market share and by using the other marketing

strategy tools. They claim that they will ever remain at this maturity

level.

Product Mix Strategy

1) Positioning the product

2) Expansion the product

3) Alteration

4) Contraction



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5) Trading up and trading down

Positioning The Product

Managements ability to bring attention to a product and todifferentiate it in a favorable way from similar products goes a long

way toward determining that products revenues. Thus management

needs to engage in positioning, which means developing the image

that a product projects in relation to competitive products and to the

firms other products.

Positioning In Relation To A Competitor

For some products the best position is directly against the

competition. This strategy is especially suitable for a firm that already

has a solid differential advantage or is trying to solidify such an

advantage.

Pepsi Cola beverages uses the positioning strategy which is related

to the competitor because it consider that it is market leader, and it try

to present its product quite different in taste, packaging, styles

designing and quality than its competitors such as coca cola, Rc cola

etc. And it always keep an eye on its existing as well as its new

coming competitors that is double cola.

Positioning In Relation To A Product Or Attribute

Sometimes a companys positioning strategy entails associating its

product with the product class and attribute. Some companies try to

place their products in a desirable class such as made in USA. But

Pepsi Cola does not use such type of positioning strategy.



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Positioning By Price And Quality

Certain producers and retailers are known for their high prices.

Pepsi Cola does not to follow the price positioning strategy because

its COO (Chief Operating Officer) says that they have changed the

strategy of giving discounts because they have to changed their

policies by seeing their competitor, but Pepsi-Cola follow the quality

positioning strategy.

Product Mix ExpansionProduct mix expansion is accomplished by increasing the depth with

in a particular and the number of lines of firm offers to customers.

When a company adds a similar item to an existing product line with

the same brand name, this is a line extension.

But Pepsi- Cola neither extends its product line nor expand its

product mix. Still it has its 4-product lines that are Pepsi Cola,

Mirinda, team and Seven-up.

Alteration Of Existing ProductsRather than developing a completely new product, management

might do well to take a fresh look at the organizations existing

products. After, improving an established product, termed product

alteration can be more profitable and less risky than developing a

completely new product.

Pepsi Cola is an already established company with the big market

share, and it changes its policies to maintain the establishment of its

products and market share by keeping the eye on its competitors,

strategies and policies.



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Product Mix ContractionProduct mix contraction is carried out either by eliminating an entire

line or by simplifying the assortment within a line. But Pepsi Coladoes not use the product mix contraction because its all product lines

have created a strong and un-volatile able images in the consumers

mind.

Trading Up And Trading DownThe product strategies of trading up and trading down involve a

change in product positioning and an expansion of product line.

Trading up

It means adding a higher price product line to attract a broader

market. Also the seller intends that the new products prestiges will

help the sale of its existing lower price products.

Trading Down

It means adding to companys product line. The firm expects that

people who cannot afford the original higher price product or who see

it as too expensive will buy the new lower price one. The reason is

that the lower price product carries same of the status and some of

the other more substantive benefits of the higher price item.

In Pepsi Cola there is no such type of product differentiation on the

basis of price. Price may differ due to the quantity level.



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For example: The price of 250 ml bottle is Rs. 8. The price of 1liter

bottle is Rs. 30 in case of non-returnable bottle and 1.5 liter bottles

price is Rs. 45.

Branding

An important part of product planning is branding, the procedure a

firm follows in researching, developing and implementing its brands.

As already noted, a brand is a name term design or symbol that

identifies the products of a seller or group of seller.

There are four types of brand designation.

Brand Name

Brand name is a word, letter, group of words or letters that can be

spoken. Pepsi-cola has introduced its product lines under the same

brand name that is PEPSI.

Brand Mark

Brand mark is a symbol, design, or distinctive colouring and lettering

that can not be spoken.



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Trade Characters

Trade character is a brand mark that is personified.

Trade Mark

A trade mark is a brandname, brand mark or trade character or

combination there of, that is given legal protection.

So that trade mark of the Pepsican be a symbol or the brand name

ie Pepsi.

Reason Of Branding

According to Pepsi-Cola, branding is very necessary due to following

reasons.

Pepsi-cola products can easily be identifiable than that of their

competitors. A customer can order a product by name instead of

description. Customers are assured that they are demanding a certain level of

quality product and people believe that they are getting the

comparable quality. If the same brand is recorded.

They believe that the well branded legally protected product is

directly identified by the customers and leave the positive good

image in customer mind.

They believe that well branded product is a well known product.

Branding the product is necessary to build the long lasting image.

In consumer mind so as the people become brand loyal. They say

that 95% of the customer are brand loyal.



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They believe that they enhance their product prestige and social

visibility through brand name. And furthermore they are enhancing

this social visibility through sales promotion techniques by

highlighting the brand name ofPepsi.

Due to the brandname, Pepsi Cola has built a good and

remarkable image in consumer mind. So people feel less risk at

the time of purchasing the Pepsi-Cola products and towards it

people show the positive and favourable attitude.

Even for there all products their brand name is same but they

believe that branding segmentize the markets by creating tailoredimage.

Cooperation from distribution intermediaries is greater for well

known brands. A strong brand also may enable the producer to

exert more control in the distribution channel.

A brand may be used to enter a new product category.

According to Pepsi-Cola through branding, it is very easy to sell

out their product lines, because the people believe such type of

legal and quality proved symbols to reduce their purchasing,

social, psychi and price risks.

Brands PhilosophyWhen Pspsi Cola developing a brand strategy, needs to determine

its branding philosophy. This philosophy outlines the use of



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manufacturer, dealer and in generic brands as well as the use of

family or individual branding.

Manufacturer brands (national brands)Manufacturer brands contain the names of manufacturers and

generate the vast majority of sales revenues for most product

categories. Pepsi Cola appeal to a wide range of the consumers,

who desire the low risk of the poor product performance, good

quality, routinized purchase behavior, status and convenience

shopping. According to Pepsi Cola, manufacturer brands are well

known and trusted because quality control is strictly maintained.

Their brand names are identifiable and present distinctive images to

shoppers.

Manufacturers normally produce a number of product alternatives

under their brands. Through the manufactures brand the major

marketing focus ofPepsi Cola is to attract and retain consumers who

are loyal to the firms offerings and to control the marketing effort for

the brands.

Private BrandsIt contains the names designated by wholesalers or retailers and

account for the significant levels of sales revenues in many product

categories. Dealers secure relatively exclusive rights for their brandsand are usually more responsible for their distribution. Private brands

typically require large total investment.

Wholesalers and retailers are able to sell their items at lower prices

and still obtain higher per-unit profits. The marketing focus of private



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brands is to attract and retain the customer who are loyal to the

dealer and for the distributor / retailers to exert control over marketing

plan for these brands large wholesalers and retailers now advertise

their brands extensively.

Generic BrandsGeneric brand emphasize the names of the products themselves and

not manufacturer and dealers names. Generics appeal to price

conscious, careful shoppers, who perceive them as representing a

very good value, are sometimes willing to accept lower quality, and

often purchase for large families generic brands are sold one

advertised and receive secondary shelf space consumers must

search out these brands. The major marketing goal is to offer low

priced, lower quality items to consumers interested in price savings.

So Pepsi Cola / obtain the manufacturer brand instead of the generic

and private brands.

Packaging

Packaging is a part of product planning in which a firm researchers,

designs, and produces its packaging.

The physical container may be a cardboard, metal, plastic or wooden

box; a cellophone, wax paper, or cloth wrapper; a glass, aluminum, or

plastic jar or can; a paper bag; styro foam; some other material; or a

combination of these products frequently have more than one

physical container.



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But packaging depends upon the product nature as well as structure

means either it is liquid, semi liquid or solid.

In case of Pepsi Cola, they take the packaging designs by

considering what is better for company and what is better or

convenient for the transportation.

For protecting the syrup, Pepsi Cola uses the glass as well as plastic

bottles of different quantity.

Packages of Pepsi Cola

1) 250 ml glass returnable bottle.

2) 175 ml glass returnable bottle.

3) 1 L glass returnable bottle.

4) 1/2 L Pet non returnable bottle

5) 1 L Pet and non returnable bottle

6) 250 ml glass non returnable bottle

7) Post mix (fresh fountain).

From fresh fountain, we can buy the fresh soda of different flavour

such as Pepsi Cola, team, Miranda and seven-up.

A year ago, Pepsi Cola has introduces the tray packaging which was

not useful for the company and retailers, because this packagingcreate the leakaging problem during the transportation and the

shopkeeper do not feel convenience in placing of such type of packs.

In their shops so now the Pepsi Cola has introduced the new

packaging design. Pepsi Cola has packed its plastic bottles in



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cardboard cartons to save such leakaging, due to this packaging its

factory cost has been increased.

Basic Packaging Function

According to coca cola packaging of the product should perform such

type of functions.

Packaging must facilitate product usage. Product disbursement

may be eased through multiple packaging Pepsi Cola offer the

packages that are reuse able one a product is depleted. For

example, in case of 1 L and 1.5L plastic non returnable bottle,

people can use these bottles after depleting the product / liquid.

Through packaging the company and its brand-name are

identified. Pepsi-Cola consider that packaging is an important

method of communication with the consumer packaging also

presents a company and product image and display the product as

well.

At the time of packaging the product, Pepsi-Cola mainly consider

the needs of the wholesales and retailers in its distribution

channel, that makes a product easy to ship, handle and store. Atthe time of packaging Pepsi-cola should also thinks the product

that packaging should by durable which allow their contents to

have a reasonable shelf life.



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Factors Considered In Packaging Decision

Pepsi-Cola also consider following factors at the time of the taking

decision about the product packaging.

Pepsi cola personnel think that package design affects the image

and quality of the product and company. Pepsi-cola consider that

the colour, shape and material all influenced the consumer

perception about the firm and its product.

In family packaging, Pepsi-cola uses a common element on each

package, in a product line.

Pespi-Cola as the international firm uses the standardized

packaging which increase the world wide recognition. So Pepsi-

cola utilize standard packages whenever possible.

Pepsi Cola uses glass, plastic, cardboard, polythene material to

preserve its product.

It uses the glass and plastic bottles to preserve the liquid,cardboard material for protect the plastic bottle in cartons and

polythene material to place the bottles into the tray- packing.

Pepsi Cola also consider the package features, which provide it

the competitive advantage. We know that Pepsi Cola is a market

leader so it keep the eyes on each and every competitive

advantage. For example now it has introduced the cardboard

bottle packing.

Pepsi- cola also give importance to the size, colour, and shape of

its packages. It has introduced the medium-sized carboard boxes

with the different traditional colours such as for Pepsi-Cola it us



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the Blue and red colour. For Mirinda it uses orange and green

colour and for team and seven up it uses the green colour

packages.

As Pepsi-cola involve in Beverages business, so every bottle has

its individual existence without wrapping.

As Pepsi-cola has its fix rates of bottles so it does not think that

there is any need of preprinted price. About UPC (Universal

Product Code), Pepsi-Cola thinks that as Pepsi-cola is franchi and

it has to sell its products within its surrounding areas so there is

no importance of UPC for its. Main reason of not using UPC isthat, it is not in list of exporters.

Price

Price is the amount f money and / or other items with utility needed to

acquire a product price is significant in our economy, in the

consumers mind, and in an individual firm value is also important as

a component of value. Value is the ratio of perceived benefits to price

and any other incurred costs. Good value indicates that a particular

product has the kinds and amount of potential benefits such as

quality, image and purchase convenience consumers expect at a

particular price level. A products price is a major determinant of the

market demand for it. Price affects a firms competitive position and

its market share. To be useful, the pricing objective management



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selects must be compatible with the over all goals set by the firm the

goals for its marketing program.

There are 3 pricing objectives:

Profit oriented:

To achieve a target return.

To maximize profit.

Sales oriented

To increase sale volume

To maintain or increase market share

Status oriented

To stabilize prices

To meet competition

Pepsi Cola use status quo-oriented pricing objective Pepsi Cola

intended simply to maintain the firms current situation that is, the

status quo.

Pepsi Cola adopt status quo pricing goals to avoid price competition

is not necessarily passive in its marketing. Quite the contrary typicallylike other status quo-pricing objective companies, Pepsi Cola also

compete aggressively using other marketing mix elements. Product,

distribution, and especially promotion or simply Pepsi Cola use

approach that is non-price competition.



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Price stabilization often is the goal in industries where products are

highly standardized and in beverage industry, products are

standardized so beverage industry try to attempt price stabilization.

Place

Place planning involves movement and ownership in a channel of

distribution, which consists of channel members. Middlemen are

channel intermediates distribution arrangements very widely. The

choice of a channel is very widely. The choice of a channel is quite

important.

Channel of distribution, which is comprised of all the organizations or

people involved in the distribution process those participating in the

distribution process are known as channel members and may include

manufacturers, service providers, wholesalers, retailers, retailers,

marketing specialists, and / or consumers. When the term middlemen

is used, it refers to wholesalers, retailers, and marketing specialist

(such as transportation firms) that are acting in their roles as

intermediaries between manufactures / service providers and their

consumers. A middleman is an independent business concern that

operates as a link between producers and ultimate consumers or

industrial users. Middlemen can perform channel functions and

reduce costs, provide expertise, open markets and lower risks. The

sorting process coordinates the goals of manufacturers and



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consumers. Channel choice depends on consumers, the company,

the product, competition, existing channels and legalities.

Distributions management of the flow of products from manufacturer

our customers and from warehouse to retailers, involving the storage

and transportation of products. A successful organization is that

which can distribute its products to their customers at the right time

and the right place. Shamim & company has efficient distribution

system because it has divided the whole area into different regions

and have different distributors for performing their activities in these

regions.

All the activities related to distribution and sales is computerized and

whole computer section ahs been made for this purpose. The

process for distribution is given below:

First of all distributors require filled bottles and came up with empty

bottles. Slip is made for this purpose on which no. of empty bottle,

date, name of distributor etc. are recorded. Distributors go to the

computer section where all the credit and debt entries are checked.

Computer operator checks that how much credit will be given to the

distributors according to company policy. After this distributor take the

slip and go to warehouse for supply of filled bottles.

There are some salesmen at each distribution center. Certain area

has been assigned to each salesmen. The concerned sales-man

fulfills the orders of his customers e.g. the retailers who purchase the

bottles from them. To meet the urgent demand certain level of safety

stock is also kept at each distribution center especially in their peak

season and on the special days such as Eid days.



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In a direct channel the manufacturer performs all functions. An

indirect channel uses independents using exclusive, selective or

intensive distribution depends on objectives, middlemen, customers

and marketing.

Pepsi Cola use intensive distribution as it widespread market

coverage, channel acceptance volume sales and profits middlemen

ofPepsi Cola, many in numbers, all types of outlets final customers

ofPepsi Cola many in numbers, connivance, oriented. Pepsi Colas

marketing emphasis or mass advertising, nearby location, items in

stock. Wholesaling is the buying / handling of merchandise and its

resale to organizational buyers wholesalers provide functions ranging

from distribution to risk taking. Wholesalers have obligations to their

suppliers and to their customers.

Shamim & company has 140 distributors in whole Multan franchise.

Retailing, the last stage in w channel, includes the activities in selling

to final consumes.

Manufacturers, importers, and wholesalers act as retailers when they

sell products directly to the final consumers. Retailing is an important

aspect of distribution because of its impact on the economy, its

functions in the distribution channel, and its relationships with

suppliers.

In this franchise of Pepsi cola, Shamim & Company, has no. of

retailers more then 30,000. Management of shamim and company

know this thing that retailers are more cost conscious. Due to this

reason, this company offers to retailers, wristwatch on buying of ten

crates and on purchasing two crates, the company give them



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coupons. For waking their performance effective, the management

also offered discounts to them.



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Promotion

Promotion is any form of communication used to uniform, persuade

and / or remind people about an organizations or individuals goods,

services, image ideas, community involvement, or impact on society.

Promotion planning is a systematic decision making relating to all

aspects of an organizations or individuals communication efforts.

The Importance Of Promotion

Promotion is a vital part of marketing. Word of mouth

communication occurs when people state opinions to others. Without

sustained positive word of mouth it is difficult for a company to

succeed.

ForPepsi Cola, people have sustained positive word of mouth.

Pepsi Cola also believed on the value of promotion as:

Establishes an image such as prestige, discount or innovative for

the company and its goods and services. Communicates features of goods and services.

It creates awareness for new goods and services.

It can reposition the images or uses of faltering goods and

services.

It generates enthusiasm from channel members.

It explains where goods and services can be purchased.

It can persuade consumers to trade up from one good or service to

a more expensive one.

It alerts consumers to sales.

It justified the prices of goods and services.



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It reinforces loyal consumers.

Types Of Promotion

Four types of promotion are:

Advertising

Publicity

Personal selling

Sales promotion

Pepsi Cola applied all these four types of promotion.

AdvertisingIt is paid non-personal communication regarding goods, services,

organizations, people, places and ideas that in transmitted through

various media by business firms, government and other nonprofit

organizations and individuals who are in some way identified in the

advertising message as the sponsor. The message in generally

controlled by the sponsor.

Pepsi Cola also use these following advertising medium, daily

newspaper, weekly newspaper commercial television, cable

television, magazines, Radio business publication, and transmitters.

The basic advertising themes are the product, consumer, and / orinstitutional appeals. Pepsi Cola use The Consumer Related

Theme, in which good or service uses explained cost benefits of

good or service shown, emphasis on how good or service helps



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consumer, threatening situation & incentives given to encourage

purchases.

PublicityIt is non personal communication regarding goods, services,

organizations people, places and ideas that is transmitted through

various media but not paid for by an identified sponsor. The message

is generally controlled by the media.

Pepsi Cola also promote its products by using this tool, that is

publicity, of promotions.

Personal SellingPersonal selling uses one to one interactions with buyers. Sales

promotion includes paid supplemental promotion efforts.

Selling in stressed when orders are large, consumers are

concentrated items are expensive, and service is required. Selling

has limited audience high costs per customers, and a poor image. A

manager must oversee personal selling functions.

Sales person compensation can take one of three general formats:

Straight salary, straight commission or a combination of salary and

commission or bonus.

Under a straight salary plan, a salesperson is paid a flat amount perhour week month or year. The advent ages are that both selling and

non-selling tasks are specified and controlled, there is security for

sales people, and expenses are known in advance. The

disadvantages are the Low sales force incentive to increase sales



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expenses not tied to productivity, and continuing costs even if there

are low sales order takers are usually paid straight salaries.

With a straight commission plan a sales pursers earnings are directly

related to sales, profits or some other type of performance. The

commission rate is often keyed to a quota, which is productivity

standard for the salesperson. A quota can be based on total sales,

total profit, customers serviced, products sold or another criterion.

The advantages of a strength commission plan are the motivated

sales people no fixed sales person compensation costs and

expenses tied to productivity. The disadvantages are the lack of

control over non-selling tasks performed the instability of a firms

dollar expenses and employer earnings, and the risk to employees.

To obtain the advantages of both salary and commission oriented

methods, many firms use elements of each is a combination

compensation plan. Such plans balance company control, flexibility,

and employee incentives. Sometimes bemuses are stipulated for

outstanding individual or company performance.

Pepsi cola use combination compensation plan.

Pepsi colas supervision encompasses four aspects of sales

management motivating sales personal, measuring performance,

completing non selling tasks and initialing behaviour changes.

Sales PromotionSales promotion efforts are greater now then ever before. Many firms

are looking for any competitive edge they can get and this

increasingly involves some kind of sales promotion. The various from



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of sales promotion are non more acceptable to firms and consumer

then in the past.

Today more consumers look for sales promotions before buying, and

channel members are putting more pressure on manufactures for

promotions. During economic downturns, even more consumers are

interested in value oriented sales promotion. Because of rising costs,

advertising and personal selling have become more expensive in

relation to sale promotion.

Sales promotion lures customers, maintains loyalty, creates

excitement, is often keyed to patronage and appeals to channel

members. Sales promotion may hurt image, cause consumers to wait

for special offers, and shift the focus from the product Pepsi cola offer

for consumer the crown schemes. Is it has been given Mercedes to

one consumer and before Pepsi Cola up till now not other its

competitors did propose such big offer. Investment by Pepsi Cola in

market is very high.

For retailers, the company use tools of trade and has been provided

refrigerator to 15,000 shops so that they exclusively sell Pepsibrand.

This company has also provided 10,000 litter racks to shops, 1000

bottle racks to shops 20,000 shops signage (boards etc) 5,000 ice

chest in rural areas. The company also provides cash on credit Rs.

1000 to its financially needed shops.

Some recently offerings by the Shamim & Company to promote its

products to consumers, as sales promotion by shell and Pepsi cola

on purchasing of twenty litter Super Petrol, one litter Pepsi bottle will

be free. On Eid event, in holiday inn, 1.5 litter Pepsi and one cake

has been given to each consumer. Pepsi cola also provide such



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offers as Dubais ticket, price discount as in holy Ramzan month, sale

Rs. 5. on 1.5 litter. In Abdullah center, Allahdin, in Tusso shop, help in

shop board. Shamim & company dont want to leave aggressive

policies against its competitors in which main competitor is coca cola

and in others one Rc. cola, double cola local drinks, and to promote

its products.

On the shop board of Tusso, company has to bear cost more then

200000 to maximum display of product, company also investing more

and more so that it can compete with competitors. Due to availability

of fresh fountain machines, the company also promoting its products

in various areas due to these sales promotion, they have increased

their sales as compared to last year.

Market segmentation & target marketDividing a market into distinct groups of buyers with different needs,

characteristics, or behaviour who might require separate products or

marketing mixes is called market segmentation.

Pepsi cola segments its products as for people of having different

tastes as for example, team, Pepsi, Miranda and 7-up. Pepsi cola is

offering these products so that different needs of consumers fulfill

markets consist of buyers, and buyers differ in one or more ways.



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Levels of market segmentation

Mass marketingIn which mass producing, mass distributing, and mass promoting

about the same product in about the same way to all consumers.

Segment marketingIn which isolating broad segments that make up a market and

adopting the marketing to match the needs of one or more segments.

Niche marketingFocusing on sub-segments or niches with distractive trails that may

seek a special combination of benefits.

Micro marketingThe practice of tailoring products and marketing programs to suit the

tasks of specific individuals and location include local marketing and

individual marketing.

a) Local Marketing: Tailoring brands and promotion to the

needs and wants of local customer groups

b) Individual marketing: Tailoring products and marketing

programs to the needs and preferences of individual

customers also labeled markets-of-one marketing andone-to-one marketing.

Pepsi cola apply segment marketing level of market segmentation.

Target market is a set of buyers sharing common needs or

characteristics that the company decides to service. According to



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them, from seven to eight years, new generation is their target

market.

But as consumers perceived that for their each product, target market

is different, for Miranda, children are their target market. For 7-up,

usually patients use this product. ForTeam, Pepsinew generation is

their target market.

Product position

The way the product is defined by consumers on important attributes

the place the product occupies in consumers mind relative to

competing products. Consumers considered Pepsi cola as on top, no

1 position. 95% people are brand loyal of Pepsi cola. To maintain its

position the management of Pepsi cola use management of Pepsi

cola use aggressive polices to maintain its position.

Marketing Environment

The factors and forces outside marketing that affect marketing

managements ability to develop and maintain successful

transactions with its target customers. The marketing environment

offers both opportunities and threats.

So by Pepsi Cola knows the vital importance of constantly watching

and adapting to the changing environment.



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Pepsi Colas marketers are responsible for identifying the important

changes in the environment. Managers also feel the need of

observing the outside environment.

Pepsi Colas marketers use the 2 discipline methods for sacking the

environmental changes.

Marketing intelligence

Marketing research.

So Pepsi Cola uses the above disciplined methods for collecting the

intonations about the marketing environment marketers also spendtime in the customer and competitor environment.

Pepsi colas environment is the combination of 2 major environments.

1) Micro environment

2) Macro environment.

Micro environmentThe forces close to the company that affects the ability to serve its

customers the company, suppliers, marketing channel firms,

customer markets, competitors and publics.

The companyIn designing the marketing plans, Pepsi colas marketing

management takes other company groups such as top management,

finance, research and development, purchasing, manufacturing and

accounting groups into accounts. In this top management sets the

companys ,mission objectives, broad strategies and policies.



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Marketing managers make the decisions within the planes made by

the top management and marketing plans must be approved by the

top management before they can be implemented.

Suppliers.Suppliers provide the resources needed by the Pepsi-Cola to

produce the beverages so suppliers developments can seriously

affect marketing. So marketing managers of Pepsi-Cola watches the

availability supply shortages or delays, labour strikes and other

events can cost sales in the short run and damage customer

satisfaction in longer run.

Raw material of Shamim and company is consist of

concentrate, sugar, empty bottles, ammonia, dioxide, caustic soda

and other chemicals used in production process and lab so for the

selection of supplier they contact different suppliers of the quotations

through phones, faxes etc or some times through daily news paper

company has different suppliers for the supply of sugar and different

chemical bottles etc which are located near the compan7 such as

Shaikhupura, Jhang etc. they rely on co-operative relationship rather

then competitive rations.

So the supply of raw material should be in time due to cooperative

relationship.

CustomersPepsi cola the need to study its customer markets closely. Consumer

markets consist of individuals and households that buy the goods and

services for personal consumption.



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Business markets buy the goods and services for further processing

or for use in their production process. Whereas the reseller markets

buy goods and services to resell at a profit. Govt. markets are made

up of government agencies that buy goods and services to produce

public services or transfer the goods and service to other who need

them at the end, international markets consist of there buyers in other

countries, including consumers, producers, resellers and government.

Here shamim & Company has the link with the customer andresellers market from children to people of every age old age usePepsi cola products.

CompetitorNo single competitor marketing strategy is best for all companies.

Shamim & company consider its own size and industry position and

compares their with its competitor.

Pepsi cola (Shamim & Company) with the dominant positions in can

industry uses those strategies that the smaller firm can not afford.

PublicsShamim & Company marketing environment also include the various

public. A public is any group that has an actual or potential interest in

or impact on an organizations ability to achieve its objective.

i) Financial publics

ii) Media publics

iii) Govt. publicsiv) Citizen action public

v) Local action public

vi) General action public

vii) Internal action public



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Shamim & company can prepare marketing plans for there major

publics as well as for its customer markets.

Macro Environment Of Shamim & Company

The large societal forces that affect the micro environment is called

as macro environment. These forces may by the demographics,

economic, natural, technological, political and cultural forces.

Demo graphic environmentIt is the study of human population in term of size, density, locations,

age, gender, race, occupation and other statistics. The demographic

environment is of major interest to the marketers because it involves

people, and people make up marketers.

Economic environmentAnother important factor for shamim & company is economic factor.

The economic environment consist of factors that affect consumer

purchasing power and spending patterns. Same countries have

subsistence economies. In such economy, they consumer most of the

industrial output.

For the containment of its market share, shamim & company also

consider the economic factor.



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Natural environmentNatural resources that are needed as inputs by marketers or that are

affected by marketing activities. Water is the integral part of its

shamim & company products which the management obtain from thenatural environment.

Technological environmentTechnological environment forces that create new technologies

creating new product and market opportunities shamim & company

seek such eppertu8nities to sustain its market leadership and it

always keep an eye on such environmental changes.

Political environmentLows, government agencies and pressure groups that influence and

limit various organizations and individuals in a give society.

Cultural environmentCultural change is made up of institutions and other forces that affect

a society basic values, perceptions, preferences and behaviours.

People grow up in a particular society that shape their basic beliefs

and values. They absorb a world view that defines their relationships

with others.

Quality



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Quality control procedure / system is provided by Pepsito Shamim &

company which is followed and monitored by Pepsi. After 3 minutes

they check the quality of bottles on each line. Pepsi Cola (shamim &

Co) management said that they have not get the ISO certification

because they do not export their products, even the product has

already built the positive and good image in consumers mind.

CompetitionIn competition Pepsi cola (shamim & company) is so aggressive.

They want to kill their competitor shamim & company feels that its

competitor is like out.



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SWOT AnalysisStrength

Pepsi Cola consider that its brand is its strength, according to it, its

brand is like iron. Another strength of Pepsi Cola is its best sales

team, its best management, best distribution channel and there are

140 distributors in each and every outlet. Pepsi Cola thinks that its

strong market position and product presentation are also in the favour

of its strength.

Opportunity

For Pepsi Cola, there are many opportunities in the market. In

Mexico, the percapita consumption of bottles is 90 per person per

year. If the availability is close to the customer then it indicates its

opportunity and Pepsi Cola company is trying to achieve this

opportunity.

Weakness

Pepsi Cola management thinks that if it fails to achieve this

opportunity then it will show its weakness.

Threat

They have to make the new policies to retain in the market to save

itself from its competitor.



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THE END

BSIT 4TH on PEPSI

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