PepsiCo: Marketing Strategy of PepsiCo
Imagine a healthy drink that makes
you feel good all day and helps you digest. This image may not be part of Pepsi's
marketing plan anymore, but it used to be.
Since then, Pepsi's marketing plan
has changed, like all good things do, to make sure the soda stays popular. In this
video, you'll learn about PepsiCo's past and how the company has managed to stay in business.
You'll also find out more about Pepsi's marketing strategy and what worked and what didn't work.
Even better, you'll be able to see how smart marketers like you can use Pepsi's strategies.
A History of the company
In 1893, Caleb Davis Bradham in New Bern, North
Carolina, came up with the recipe for Pepsi. The pharmacist came up with the name
"Brad's Drink" for this cola and finally quit his job to focus on his new business.
Due to a lack of sugar, the business went out of business in 1923.
Creditors took the patent
for the drink until Roy Megargel paid them off.
Megargel kept working until the company
went out of business for the second time, this time because of the Great Depression.
Charles Guth used this chance to buy out Pepsi, so all of the Coke products in his candy
shop, Loft's, were switched to Pepsi.
Guth bought a sugar farm in Cuba in case there was
another sugar shortage and the drink went out of business.
Guth also made Pepsi's price affordable
by charging half as much as other sodas, which caused sales to increase dramatically.
After about 10 years, Loft's changed its name to "the Pepsi-Cola Company," and Walter Mack took
over as CEO. PepsiCo changed its image a few times before deciding on the red, white, and blue
stripes to show patriotism during World War 2.
In 1961, Pepsi-Cola and Frito Lay finally
joined forces to make the brand we know today.
Pepsi's marketing strategy, which includes new
products and star endorsements, has helped the company grow into what it is today.
Pepsi Marketing Mix Product
Even though most of PepsiCo's goods are carbonated
drinks, the company has added more items since it got together with Frito-Lay. These items vary
from salty snacks to teas and fruit drinks.
Price
Pepsi's pricing plan is based on how much their competitors charge
and how much their customers want to pay. The company tries to get people to buy in bulk by
making the price per ounce of Pepsi cheaper for larger quantities than for smaller quantities.
This approach helps them improve the ways they already sell their products.
Place
Even though PepsiCo's main office is in
New York, their goods are sold in more than 200 countries.
Pepsi also has 36 plants
around the world that bottle the soda.
India loves Pepsi, which is why it is the
third most popular fizzy drink in the country.
The product is sold by the brand in retailers
and grocery stores. But they also have deals with well-known fast-food chains like
Wendy's, Pizza Hut, and Taco Bell.
Promotion
Pepsi depends a lot on a strong brand image and endorsements from famous
people to sell their goods. Michael Jackson, Britney Spears, and Beyonce have all said nice
things about the brand and its signature drink.
Memorable Pepsi Marketing Strategies
PepsiCo has had numerous challenges on the road and almost failed in the past.
They were lucky that they used the following marketing strategies to make sure their business
would live (and do well) in a tough market.
1. Branding Efforts
When Pepsi came out seven years after Coca-Cola, both were already well-known brands.
Pepsi had
to find a way to make their name stand out.
History shows that this wasn't an easy job,
and they went through a number of names before settling on the one they use now.
Pepsi made new commercials and slogans to get people's attention and show that
they were "the new soda on the block."
"You've got a lot to live for," was their motto.
"Pepsi's got a lot to give" gave the brand a voice that was new and young. Coca-Cola was shown to be
old-fashioned by the way Pepsi marketed itself.
2. Sponsorships And Endorsements
It's no secret that Pepsi promotes their products with the help of star endorsements and company
sponsorships. In fact, Pepsi has the only rights to the halftime show at the Super Bowl, which is
watched by about 100 million people every year.
Since 2015, Pepsi has also been a key sponsor
of the NBA.
The company is still reaching out to other groups. In 2017, PepsiCo became
the sponsor of the UEFA Champions' League.
In 1983, Michael Jackson was the first famous
person to work with Pepsi. He was the face of their "New Generation" ad. Because of his
fame, the brand got a lot of attention and became the drink of a new, younger group.
In later years, other famous people like Britney Spears, Cindy Crawford, and Beyonce
did the same thing and worked with PepsiCo.
3. Embracing Social Media
Pepsi teamed up with the China Women's Development Foundation (CWDF) to welcome the Chinese New
Year and bring attention to the importance of family.
In 2014, they worked together to
make the "Bring Home Happiness" campaign.
This campaign had a mini-movie, celebrity
endorsements, and a charity program, all of which were supported by social media
channels that people could interact with.
People on the popular Chinese social networks
Weibo and WeChat could share films about their families. The video ad told people to spend more
time with their families over the holidays and share photos and videos of it on social media.
With this campaign as part of Pepsi's marketing plan, the company got seen by a huge
number of people. This program had more than 15 million videos on social media,
and 1.2 billion people watched them.
4. Learning From Failure
PepsiCo hasn't always been the huge company as it is now. Early in its
history, the business went bankrupt twice!
They were able to get back on their feet
and come up with some pretty memorable ads.
But not every effort worked
out the way they hoped it would.
In 1992, at the height of the clear soda phase,
Crystal Pepsi made its mark on the market. Unfortunately, Pepsi took the
drink off store shelves in 1994.
Some people think that the reason for
the failure was a lack of communication with the public. Consumers didn't know why the
color changed, so they didn't buy the goods.
Others think that the failure of Crystal Pepsi was
caused by Coca-Cola's release of Tab Clear at the same time. Both products were in close competition
with each other, which hurt them both.
But in 2022, Pepsi said that Crystal Pepsi would
be back to celebrate the drink's 30th anniversary. Still, you couldn't buy the drink in shops.
Instead, the company used Twitter to announce a contest in which customers were asked
to send in a picture from the past. Then, they were told to use the terms "#ShowUsYour90s"
and "#PepsiSweepstakes" for a chance to win.
Let’s see if you can find the
answer for this question!
How did PepsiCo manage to survive during the Great
Depression and increase sales dramatically?
a) Introducing new flavors like cherry and vanilla
b) Offering discounts on bulk purchases of Pepsi c) Reducing the price of Pepsi to
compete with other sodas d) Focusing on international markets to offset losses
Give your answers in the comment section below!
How Marketers Can Use These Strategies
To Improve Their Own Approach
1.
Build a strong brand
Creating a strong brand takes time, but it can help you keep a good reputation with
your target group. A consistent brand can also help people remember and stay with a company.
You can try out different logos, slogans, jingles, or other design elements to help
you make a brand that people will remember.
2. Embrace Partnerships
You can use partnerships to reach more people, just like Pepsi did with
business sponsorships and endorsements from famous people.
Make sure you pick people or businesses
that fit with what your brand stands for.
If your brand isn’t at a similar level
to PepsiCo, use micro-influencers or partner with smaller, local businesses.
3. Find New Ways To Connect With Your Audience
People's needs are always changing, so social
channels are always changing to meet those needs. Make sure that your efforts use
these ways to reach the target.
The "Bring Happiness Home" ad by Pepsi was mostly
driven by social media, and you can do the same. Make sure you go where your
audience is and use the methods that are most likely to get their attention.
4. Take Risks (And Learn From Your Mistakes)
Rome wasn’t built in a day. The same is true
for both Pepsi's brand and your business.
Making mistakes is part of growing up.
What matters is that you figure out why you failed and keep trying again.
You can see how PepsiCo kept going even when things were hard in the beginning.
Pepsi chose to buy their own sugar plantation so they wouldn't have to go out of business
again because there wasn't enough sugar. They spread out their money so that their
past wouldn't be the same as their future.
PepsiCo brought back Crystal Pepsi
and advertised it in a way that wasn't possible when it was first launched.
Even though it wasn't the best product, they saw that some customers liked
the fact that it wasn't very common.
If something isn't working for your business,
you should reconsider your plan and try again.
Pepsi Marketing Strategy Recap
In this video about how to sell Pepsi, you've seen how PepsiCo got started.
They
had to work hard to become the well-known name they are now, and their strength has shown.
Even though Pepsi has had some problems, it is now a multibillion-dollar business that has no plans
to slow down. PepsiCo succeeded by emphasizing branding, embracing endorsements, connecting with
their audience, and learning from their failures.
If you use the same business plan as Pepsi, you
can do well too. Using what you've learned here, make a brand that is new and
exciting for a whole new age..
