A

Summer Training Report

On
“Coke V/s Pepsi Market
Share in special area of
NCR”

Submitted in partial fulfillment for the requirement of

the award of degree in
Master of Business Administration

SUBMITTED TO: SUBMITTED BY:

Ms. Famina CHIRAG
(Faculty) Roll No. (0)
MBA (4th Sem.)
 ACKNOWLEDGEMENT

The opportunity of research with the help of Mr. Ashish Khandalwal

(Marketing Manager) to very professional and experience Work for me..
It is not only gave me practical and analytical experience but also contributed
largely in laying the foundation for concern the fields of marketing and the
information about very large and glamour war between the two big cola
companies.
.
I wish to express my profound gratitude to my faculty Ms. Famina (Faculty)
who gave me an opportunity to undergo summer training and who gave a
patient hearing and support. Thus increasing my knowledge and understanding
the various facts and function of the soft drink industry.

CHIRAG

2
 PREFACE

Marketing is too important to be left to the marketing department.

David Packard of Hewlett Packed.
The Indian market is getting to be consumer-led. This is the reason behind the
unprecedented boom in advertising. Below the line marketing activities, fast
distribution system and more sophisticated consumer research.
On the media front, satellite proliferation has trigged of a new genre of media
research, which is highly viewer ship based. Consumer satisfaction has become
research worthily Multinationals are pouring in precisely because of this new
chapter in Indian consumerism.
The dilemma that all marketers are facing is getting the maximum done in the
minimum possible time. And with brand loyalty becoming a thing of the past,
given the choice available to the consumer pull. The consumer could be a
purchaser of end products, or a financial investor, or even an industrial
purchaser. Everywhere, there is a new thrust on marketing and advertising.
The hyper activity in the market place is seeing a boom in support services,
with a number of independent agencies mushrooming to provide them. Co-
related to the market book, services are well on their to becoming a major
industry.
The creative leap is increasingly being governed by market realities and
consumer research. And Clint interface is no longer limited to the Clint service
people, but including all specialists in agencies.
The entry multinational products in to the country are seeing more emphasis aid
world- class quality. This along with the loosening of regulations is seeing

3
export gaining ground. From thinking along the lines of merely exporting
spares and raw material the exporters and now looking towards finished
products. A multiplier to this is the joint venture companies looking at
becoming export manufacturing bases.

The scene has moved beyond the threshold of global presence, inward and out
ward. However, there are certain issue still dogging an unhindered move
forward something bound to happen when the economy is just opening up.
These need to be addressed. Nonetheless, India has taken the irrevocable step
forward in becoming a part of the global family. And in the process of growth,
there are already and will be in future, quantum jumps in progress.

CHIRAG

4
 OBJECTIVE OF THE STUDY

• To find out the market plan of the company over the competitors.

• To analyze the market share of COKE.

• To study the consumer preference about COKE.

5
 EXECUTIVE SUMMARY
This project is an extensive research on the marketing strategies of the two
Cola giants Pepsi and Coca Cola. It covers an extensive survey
and depicts all graphs, fact and figures of two companies. It
begins with the introduction of soft drink industry and
introduction of these two companies of soft drink industry. It
covers some of the major strategies adopted by Pepsi and Coca-
Cola like their pricing policy, sales promotion and advertising
policy, distribution policy etc. The project has been made
interesting with the inclusion of the topics, which covers the 4P’s
of marketing.

The major players in the soft drink industry in India are Coke and Pepsi.
Pepsi holds the major market share followed by Coke. They have
a cut throat competition between themselves. Whatever strategy is
followed by one company, it is copied by the other.

Sample of to brands were selected on the basis of there uses and

noticeciability.

One of the selected brands are NO1 brand in their respective product
categories the other one brand is close competitor of the No 1
brands. Total sample of size of 200 respondents selected on the
basic of convenience was surveyed which include consumers.

Data was collected from secondary as well as primary sources.

Structure questionnaire was use to collect primary data

i . ex e
 INTRODUCTION:

In the modern urban culture consumption of soft drinks particularly among

younger generation has become very popular. Soft drinks in various flavors
and tastes are widely patronized by urbane population at various occasions
like dinner parties, marriages, social get together; birthday calibration etc.
children of all ages and groups are especially attracted by the mere mention
of the word soft drinks.

With the growing popularity of soft drinks, the technology of its production,
preservation, transportation and or marketing in the recent years has
witnessed phenomenal changes.

The so-called competition for this product in the market is from different
other brands. Mass media, particularly the emergence of television, has
contribute to a large extent of the ever growing demand for soft drinks the
attractive jingles and sport make the large audience remember this product at
all times.

It is expected that with the sort of mass advertising, reaching almost the
entire country and offering various varieties annual demand for the product
is expected to rise sharply in the times to come.

7
In any marketing situation, the behavioral / environmental variables relating
to consumers, competition and environment are constantly influx. The
competitors in a given industry may be making many tactical maneuvers in
market all the time. The may introduce or initiate an aggressive promotion
campaign or announce a price reduction. The marketing man of the firm has
to meet all these maneuver and care of competitive position of his firm and
his brand in the market. The only route open to him for achieving this is the
manipulation of his marketing tactics.

In today’s highly competitive market place, three players have dominated

the industry; The New York based Pepsi Company Inc. The Atlanta based
coca- cola and U.K. based Cadbury Schweppes.

Through the globe, these major players have been battling it out for a bigger
chunk of the ever –growing soft drink market. Now this battle has been
evolved up to India too with the arrival of these three giants.

Soft drink industry is on amazing growth; ultimately these are only one
person who will determine their fortunes. The Indian consumer. The real
War to quench his thirst has just begun.

8
 SOFT DRINK INDUSTRY: AN OVERVIEW

It all began in 1886, when a tree legged brass kettle in Hohn Styth
pemberton’s backyard in Atlanta was brewing the first P of marketing leged.
Unaware the pharmacist has given birth to a caromel colored syrup, which is
now the chief ingredient of the world’s favorite drink. The syrup combined
with carbonated the soft drink market. It is estimated that this drink is served
more than one thousand million times in a day.
Equally oblivious to the historic value of his actions was Frank Ix.
Robinson, his partner and book keeper. Pemberton & Robinson laid the first
foundation of this beverage when an average nine drinks per day to begin
with, upping volumes as sales grew.
In 1894, this beverage got into bottle, courtesy a candy merchant from
Mississippi. By the 1950’s Colas were daily consumption items, stored in
house hold fridges. Soon were born other non- cola variants of this product
like orange & Lemon.
Now, the soft drink industry has been dominated by three major player – (1)
The New York based Pepsi co. Inc.(2) The Atlanta based coca cola co. (3)
The united Kingdom based Cadbury Schweppes.
Though out the glove these major players have been battling it. Out for a
bigger chunk of the ever-growing cold drink market. Now this battle has
begun in India too. India is now the part of cold drink war. Gone are days of
Ramesh Chauhan, India’s one time cola king and his bouts of pistol
shooting. Expect now to hear the boon of cannons when the Coca Cola &

9
Pepsi co. battle it out for, as the Jordon goes a bigger share of throat. By
buying over local competition, the two American Cola giants have cleared
up the arena and are packing all their power behind building the Indian
franchisee of their globe girdling brands. The huge amount invested in
fracture has never been seen before. Both players seen an enormous
potential in his country where swigging a carbonated beverage is still
considered a treat, virtually a luxury. Consequently, by world standards
India’s per capita consumption of cold drinks as going by survey results is
rock bottom, less than over Neighbors Pakistan & Bangladesh, where it is
four times as much.
Behind the hype, in an effort invisible to consumer Pepsi pumps in Rs 3000
crores (1994) to add muscle to its infrastructure in bottling and distribution.
This is apart from money that company’s franchised bottles spend in
upgrading their plants all this has contributed to substantial gains in the
market. In colas, Pepsi is already market leader and in certain cities like
NCR , Pepsi outlets are on one side & all the other colas put together on the
other. While coke executive scruff at Pepsi’s claims as well as targets,
industry observers are of the view that Pepsi has definitely stolen a march
over its competitor coke.
Apart from numbers, Pepsi has made qualitative gains. The foremost is its
image. This image turnaround is no small achievements, considering that
since it was established in 1989, taking the hardship route prior to
liberalization and weighed down by export commitments.
Now, at present as there are three major players coke, Pepsi and Cadbury
and there is stiff competition between first two, both Pepsi and coke have
started, sponsoring local events and staging frequent consumer promotion
campaigns. As the mega event of this century has started, and the marketers

10
are using this event – world cup football, cricket events and many more
other events.
Like Pepsi, coke is picking up equity in its bottles to guarantee their
financial support; one side coke is trying to increase its popularity through.
Eat Food, enjoy Food. Drink only coca cola. Eat cricket, sleep cricket.
Drink only coca cola. Eat movies, sleep movies. Drink only coca cola.

On the other side of coin Pepsi has introduced AMITABH BACHHAN for
capturing the lemon market through MIRINDA – Lemon with “zor ka
jhatka dheere se lage”.

But no doubt’ that UK based Cadbury is also recognizing its presence. So

there is a real crush in the soft drink market. With launch of the carbonated
organize drink Crush, few year ago in Banaras ., the first in a series of a
launches , Cadbury Schweppes beverage India (CSBI) HAS PLANNED:-
The world third largest soft drink marketers all over the country.CSBI o
wholly owned subsidiary of the London based $ 6.52billion. Cadbury
Schweppes is hoping that crush is going well and well not suffer the same
fate as the Rs. 175 crore Cadbury india’s apple drink Apella. CSBI is now
with orange (crush), and Schweppes soda in the market.

As orange drinks are the smallest of non-cola categories that is Rs. 1100
crore market with 10% market share and cola heaving 50% is followed by
Lemon segment with 25%.

11
The success of soft drink industry depends upon 4 major factors viz.
 Availability
 Visibility
 Cooling
 Range

AVAILABILITY
Availability means the presence of a particular brand at any outlet. If a
product is now available at any outlet and the competitor brand is
available, the consumer will go for the at because generally the
consumption of any soft drink is an impulse decision and not
predetermined one.

VISIBILITY
Visibility is the presence felt, if any outlet has a particular brand of soft
drink say- Pepsi cola and this brand is not displayed in the outlet, then its
availability is of no use. The soft drink must be shown off properly and
attractively so as to catch the attention of the consumer immediately Pepsi
achieves visibility by providing glow signboards, hoarding, calendars etc.
to the outlets. It also includes various stands to display Pepsi and other
flavors of the company.

COOLING
As the soft drinks are consumed chilled so cooling them plays a vital role
in boosting up the sales. The brand, which is available chilled, gets more
sales then the one which is not, even if it is more preferred one.

12
RANGE
This is the last but not the least factor, which affects the sale of the
products of a particular company.
Range availability means the availability of all flavors in all sizes.

13
 RESEARCH METHODOLOGY

METHODOLOGY
Research is a common language refers to a search of knowledge. Research is
scientific & systematic search for pertinent information on a specific topic,
infect research is an art of scientific investigation. Research Methodology is
a scientific way to solve research problem. It may be understood as a science
of studying how research is don’t scientifically. In it we study various steps
that are generally adopted by researchers in studying their research problem.
It is necessary for researchers to know not only know research method
techniques but also technology.

The scope of Research Methodology is wider than that of research methods.

The research problem consists of series of closely related activities. At
times, the first step determines the native of the last step to be undertaken.
Why a research has been defined, what data has been collected and what a
particular methods have been adopted and a host of similar other questions
are usually answered when we talk of research methodology concerning a
research problem or study. The project is a study where focus is on the
following points:

RESEARCH DESIGN
A research design is defined, as the specification of methods and
procedures for acquiring the Information needed. It is a plant or organizing
framework for doing the study and collecting the data. Designing a research

14
plan requires decisions all the data sources, research approaches, Research
instruments, sampling plan and contact methods.
Research design is mainly of following types: -
1. Exploratory research.
2. Descriptive studies
3. Casual studies

EXPLORATORY RESEARCH

The major purposes of exploratory studies are the identification of

problems, the more precise Formulation of problems and the formulations of
new alternative courses of action. The design of exploratory studies is
characterized by a great amount of flexibility and ad-hoc veracity.

DESCRIPTIVE STUDIES

Descriptive research in contrast to exploratory research is marked by

the prior formulation of specific research Questions. The investigator already
knows a substantial amount about the research problem. Perhaps as a Result of
an exploratory study, before the project is initiated. Descriptive research is also
characterized by a Preplanned and structured design.

CASUAL OR EXPERIMENTAL DESIGN

A casual design investigates the cause and effect relationships
between two or more variables. The hypothesis is tested and the experiment
is done. There are following types of casual designs:
I. After only design
II. Before after design

15
 III. Before after with control group design
IV. Four groups, six studies design
V. After only with control group design.
VI. Consumer panel design
VII. Exposit facto design

B) DATA COLLECTION METHOD

PRIMARY SECONDARY

Direct personal Interview

Indirect personal Interview Published Sources

Unpublished

Information from correspondents Govt.publication Sources

Mailed questionnaire Report Committees & Commissions

Question filled by enumerators. Private Publication

Research Institute
PRIMARY DATA
These data are collected first time as original data. The data is recorded as
observed or encountered. Essentially they are raw materials. They may be
combined, totaled but they have not extensively been statistically processed.
For example, data obtained by the peoples.

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SECONDARY DATA

Sources of Secondary Data

Following are the main sources of secondary data:

1. Official Publications: Publications of the PEPSI & COKE and by

the corporate office of PEPSI & COKE.

2. Publications Relating to Trade: Publications of the trade

associations, stock exchange, trade union etc.

3. Journal/ Newspapers etc.: Some newspapers/ Journals collect and

publish their own data, e.g. Indian Journal of economics, economist,

Economic Times.

4. Data Collected by Industry Associations: For example, data

available with PEPSI & COKE..

5. Unpublished Data: Data may be obtained from several companies,

organizations, working in the same areas. For example, data on

PEPSI & COKE magazines.

Period of Study: This study has been carried out for a maximum period of 8
weeks.

Area of study: The study is exclusively done in the area of marketing. It is a

process requiring care, sophistication, experience, business judgment, and
imagination for which there can be no mechanical substitutes.

17
Sampling Design: The convenience sampling is done because any
probability sampling procedure would require detailed information about the
universe, which is not easily available further, it being an exploratory
research.

Sample Procedure: In this study “judgmental sampling procedure is used.

Judgmental sampling is preferred because of some limitation and the
complexity of the random sampling. Area sampling is used in combination
with convenience sampling so as to collect the data from different regions of
the city and to increase reliability.

Sampling Size: The sampling size of the study is 100 users.

Method of the Sampling:

Probability Sampling
It is also known as random sampling. Here, every item of the universe has
an equal chance or probability of being chosen for sample.
Probability sampling may be taken inform of:

Simple Random Sampling

A simple random sample gives each member of the population an equal
chance of being chosen. It is not a haphazard sample as some people think!
One way of achieving a simple random sample is to number each element in
the sampling frame (e.g. give everyone on the Electoral register a number)
and then use random numbers to select the required sample.

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Random numbers can be obtained using your calculator, a spreadsheet,
printed tables of random numbers, or by the more traditional methods of
drawing slips of paper from a hat, tossing coins or rolling dice.

Systematic Random Sampling

This is random sampling with a system! From the sampling frame, a starting
point is chosen at random, and thereafter at regular intervals.

Stratified Random Sampling

With stratified random sampling, the population is first divided into a
number of parts or 'strata' according to some characteristic, chosen to be
related to the major variables being studied. For this survey, the variable of
interest is the citizen's attitude to the redevelopment scheme, and the
stratification factor will be the values of the respondents' homes. This factor
was chosen because it seems reasonable to suppose that it will be related to
people's attitudes

Cluster and area Sampling

Cluster sampling is a sampling technique used when "natural" groupings
are evident in a statistical population. It is often used in marketing research.
In this technique, the total population is divided into these groups (or
clusters) and a sample of the groups is selected. Then the required
information is collected from the elements within each selected group. This
may be done for every element in these groups or a subsample of elements
may be selected within each of these groups.

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Non Probability Sampling
It is also known as deliberate or purposive or judge mental sampling. In this
type of sampling, every item in the universe does not have an equal, chance
of being included in a sample.
It is of following type:

Convenience Sampling
A convenience sample chooses the individuals that are easiest to reach or
sampling that is done easy. Convenience sampling does not represent the
entire population so it is considered bias.

Quota Sampling
In quota sampling the selection of the sample is made by the interviewer,
who has been given quotas to fill from specified sub-groups of the
population.

Judgment Sampling
The sampling technique used here in probability > Random Sampling.
The total sample size is 100 profiles.

Data Collection: - Data is collected from various customers through

personal interaction. Specific questionnaire is prepared for colleting data.
Data is collected with mere interaction and formal discussion with different
respondents and we collect data in PEPSI & COKE and face to face
contact with the persons from whom the information is to be obtained
(known as informants). The interviewer asks them questions pertaining to
the survey and collects the desired information. Thus, the we collect data

20
about the working conditions of the workers of COKE; I worked at COKE
contact the workers and obtain the information. The information obtained
are first hand or original in character.

21
 COKE COMES TO INDIA
Coca-Cola come to India with fanfare in the fifties. For a number of days,
The Hindustan Times and other newspapers of New Banaras carried full
page advertisement showing a big boy in uniform with a soft-drink crown as
the cap. There was no indication of the product. After a few days, Coke was
introduced. It was an entirely new drink which fascinated people. It soon
became the national drink. For the first time, a soft-drink was available from
one corner of the country to another. The person who brought Coca-Cola to
India was the father of late Sardar Charanjit Singh, Sardar Mohan Singh. A
practical man Mohan Singh realised that to popularise Coca-Cola, and make
it a best seller it was necessary to “catch them young.” So he focused on
youngsters in the society.

The company realised that to become a mass consumption product, one has
to go to the village. They gave much importance to the distributive network.
The company trucks supplied coke to even the remotest village.

Few products appears to be more similar than soft drinks, yet the Cola wars
that mark the competition between Coke and Pepsi show how even
organizations with highly similar product can be differentiated by their
business strategies. Then came battles over the issue of bottle size
standardization. Coke the arch rival tried to offering more Cola at a lower
price. Pepsi which had some of its early investment tied up in 250ml bottles,
went the fountain way. The General bottle size freed has settled at 300 ml,
100 ml more than the pre MNC standard. Fountain mix dispensers, carry
home bottles, even 1.50 plastic bottle with caps good enough to keep them
lying down and still preserve the fizz.

22
It poured in vast sums to whip up its visibility at the retail level, so that
consumers were greeted virtually at every street corner by Pepsi’s blue, red
and white colors, because they have perception “the thing on display sells
more.”. Coca-Cola is, finally, redoing the real thing to the replicate the
success that its arch-rival, PepsiCo, has achieved with its fast and furious
marketing. But to win them, Coke is copying Pepsi.

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 STRATEGIES ADOPTED

BY COKE AND PEPSI

The Pepsi Process: Despite being a global brand, Pepsi has built its success on

meeting the Indian consumer’s needs, particularly in terms of making the

brand synchronize with localized events and traditions. Instead of harping on
its global lineage, ergo, it tries to plug into ethnic festivals, use the
vernacular indifferent part of the country, and blend into the local fabric.
Pepsi is using both national campaigns-such as the Drink Pepsi, Get Stuff
scheme, which offers large discounts on other products to Pepsi-buyers as
well as local .

The Coke Copy: Instead of creating a bond with the customers through small

but high-impact events, Coca-Cola chose to associate itself with national and
international mega events like the World Cup Cricket, 1996, and world cup
football 1998. But now coke is also entering into local actions. Coke is also
trying to make their brand synchronize with localized events traditions and
festivals. Coca-Cola new tag line in this advertisement is “Real shopping,
Real refresher”. In this way Coke is copy Pepsi.

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EMPOWERMENT

The Pepsi Process: Once of the strongest weapons in Pepsi’s armory is the

flexibility it has empowered its people with. Every manager and salesperson
has the authority to take whatever steps he, or she, feels will make
consumers aware of the brand and increase its consumption.

The Coke Copy: Flexibility is the weapon that Coca-Cola, fettered as it is by

the need for approvals from Atlanta for almost everything. In the past, this
has shown up in its stubborn insistence on junking the franchisee network it
had acquired from Parle; in its dependence on its own feedback mechanism
over that of its bottlers;’ and on its headquarters-led approach.

PRICE

The Pepsi process: Pepsi has consistently wielded its pricing strategy as in

invitation to sample, aiming to turn trial into addiction.

It launched the 500 ml bottle in 1994 at Rs. 8 versus Thums Up’s Rs. 9, in
April, 1996, its 1.5 litre bottle followed Coke into the marketplace at Rs. 30
– Rs 5 less than Coke’s .But it couldn’t continue the lower price positioning
for long.

The Coke Copy: Initially, coke carbon-copied the strategy by introducing its

330ml cans in January 1996, at an invitation price of Rs. 15 before raising it

to Rs. 18. By this time, it had realised that the Coca-Cola brand did not hold
enough attraction for customers to fork out a premium. The 200ml Coke,
launched so far in parts of eastern, western, and northern India, is priced at
Rs. 5, lowering the entry-barriers. To really drive the market, as Coke wants
to you must go down to Rs. 3’.

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 PEPSI VS. COKE

$28 BILLION TURNOVER $16 BILLION

32% INT. SALES AS % 70%

` OF TOTAL SALES

RS. 5OO CRORES TOTAL INVESTMENT RS. 250 C

IN INDIA

RS. 300 CRORES PROPOSED RS. 2,400C

INVESTMENTS

2400 NO. OF EMPLOYEES 140

13 NO. OF OWNED NIL

BOTTLING PLANTS

18 NO. OF FRANCHISES 53

4000 NO. OF FOUNTAIN 1500

N.A. TOTAL INVESTMENT Rs 125 CR

BY BOTTLERS

6 NEW PLANTS PLANNED N.A.

26
PEPSI AND COKE MARKET SHARE IN INDIA

27
COLA : 60% CLEAR LEMON : 4%
Pepsi : 26.5 7-UP : 2.5%
Thums-up : 17.5% Citra : 0.5%
Coke :10%
ORANGE : 16% OTHERS : 8%
Mirinda : 7.5% Other Brands : 16.5%
Fanta : 6%
Gold Spot : 1%
Crush : 1%
CLOUDY LEMON : 12%
Limca : 9%
Mirinda lemon + Duke’s : 1.5%
Schweppes lemon : 0.5%

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 The Cola Wars

OVER A CENTURY OF COLA SLOGANS,

COMMERCIALS, BLUNDERS, AND COUPS

There's little doubt that the most spirited and intense competition in the
beverage world is between Coca-Cola and Pepsi. These two American
companies long ago took their battle worldwide, and although there are other
colas in the market, these giants occupy this high-stakes arena by
themselves. The impact of Coke and Pepsi on popular culture is
indisputable, and I have observed in my time managing this web site that
America has not become jaded about the cola wars. The memorabilia, the
jingles, the trivia - all still popular. So I am offering this page in an attempt
to assuage a wee bit of the Coke and Pepsi thirst that is thriving on our
planet.

IT ALL STARTED . . . .
Coca-Cola was invented and first marketed in 1886, followed by Pepsi in
1898. Coca-Cola was named after the coca leaves and kola nuts John
Pemberton used to make it, and Pepsi after the beneficial effects its creator,
Caleb Bradham, claimed it had on dyspepsia. For many years, Coca-Cola
had the cola market cornered. Pepsi was a distant, nonthreatening contender.
But as the market got more and more lucrative, professional advertising

29
became more and more important. These soda companies have been leading
the way in advertising ever since.

ADVERTISING HISTORY & COMMERCIALS

Pepsi has definitely leaned towards the appeal of celebrities, popular music,
and young people in television commercials, while Coke relies more heavily
on images of happiness and togetherness, tradition, and nationalism,
perpetually trying to cash in on its original lead. In a simplified sense, you
could sum up the strategies as Coke: Old, Pepsi: New. In fact, as we will
see, when Coca-Cola tried something new, it was disaster.

The first magazine ad for Coca-Cola appeared in Munsey's in 1902.

Advertisements began to appear on billboards, newspapers, and streetcars.
Soon there were serving trays with images of people enjoying Coca-Cola,
and glasses with the cola's name on them. At this time, Coca-Cola and Pepsi
were served in drugstore soda fountains.

In 1909, Pepsi used its first celebrity endorser, automobile race driver
Barney Oldfield, in newspaper ads. In 1921, Pepsi went bankrupt, but
continued to appear on the scene, although not nearly so successfully as
Coca-Cola. In 1931, Pepsi went bankrupt again, but the new owner, Roy
Megargel, would hit upon an idea that would finally give Coca-Cola some
competition. In 1934, he marketed Pepsi in a 12-ounce bottle for a nickle. At
the time, Coca-Cola was sold in a 6-ounce bottle for ten cents. Voila! Profits
for Pepsi.

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Pepsi racked up another first by airing the first radio jingle in 1939. It was so
popular that it was played in jukeboxes and became a hit recordCoca-Cola
hit the airwaves in 1941.

In 1946, inflation forced Pepsi to increase prices. And in 1950, Pepsi offered
a larger 26-ounce bottle to court the young American housewife.

In the 1960's, the cola ad wars moved to television. Coca-Cola employed a

host of celebrity singers to promote the product, including Connie Francis ,
Tom Jones, The New Beats, Nancy Sinatra, and The Supremes. As we
moved through the years, both colas incorporated some of their best slogans
("Pepsi Generation" and "the Real Thing") into subsequent commercials.

In the 1970s, market research showed that consumers preferred the taste of
Pepsi over Coke. The Pepsi Challenge is still being conducted today. But
Coke came up with what is arguably the best of all cola commercials, the
1971 I'd Like to Buy the World a Coke ad. This landmark was recalled in
Christmas versions in 1983 and 1984, and a 1990 Super Bowl ad, which
was enough to make some Baby Boomers weep with nostalgia.

In the 1980's, Pepsi lined up the celebrities, starting with Michael Jackson,
then Madonna, Michael J. Fox, Billy Crystal, Lionel Ritchie, Gloria Estefan,
Joe Montana, and others. Coke signed on Michael Jordan, New Kids on the
Block, Aretha Franklin, Elton John, and Paula Abdul.

In 1985, responding to the pressure of the Pepsi Challenge taste tests, which
Pepsi always won, Coca-Cola decided to change its formula. Bill Cosby was
the pitchman. This move set off a shock wave across America. Consumers
angrily demanded that the old formula be returned, and Coca-Cola

31
responded three months later with Classic Coke. Eventually, New Coke
quietly disappeared.

Pepsi, meanwhile, had its own flop, Crystal Pepsi, which was supposed to
catch the strange wave of the times when everything colorless was clean and
desirable (Zima, bottled water). And then there was Pepsi Lite with the
lemony flavor and one calorie, introduced in 1975. Remember that one?
Apparently they didn't expect us to because later they gave us Pepsi One,
using the same concept, but a completely different taste. And, extending the
idea even further, we are now getting Pepsi Twist, a new product with a
twist of lemon flavor.

In 1991, Ray Charles sang, "You got the right one baby, uh-huh!" Also in
the 1990s, Cindy Crawford and the Spice Girls pitched Pepsi. And then
Pepsi aired commercials featuring the aggravating little girl (Hallie
Eisenberg) with her troubling male voice.

In the new century, both colas continue to battle it out on the television
screen. And celebrities continue to be important promoters. Recently, Pepsi
has had commercials by Bob Dole and Faith Hill, among others.

32
 SLOGANS
It's clear in looking at the slogans over the years that Coke and Pepsi have
very different targeting strategies. Coke is touting itself as the original, the
authentic, and appealing to a sense of tradition, positioning itself as an
integral part of daily American life. Pepsi, on the other hand, is promoting
itself as something new, young, and hip, which seems a little odd after over
100 years. But Coke was first, after all. Pepsi has always targeted the youth
market more aggressively than Coke.

COCA-COLA
1886 - Drink Coca-Cola
1904 - Coca-Cola Satisfies
1904 - Delicious and Refreshing
1905 - Coca-Cola Revives and Sustains
1905 - Good All the Way Down
1906 - The Drink of Quality
1906 - The Great National Temperance
1907 - Delicious Coca-Cola, Sustains, Refreshes, Invigorates
1907 - Cooling . . . Refreshing . . . Delicious
1908 - Sparkling - Harmless as Water, and Crisp as Frost
1909 - Delicious, Wholesome, Refreshing
1910 - It Satisfies
1910 - Quenches Thirst as Nothing Else Can
1911 - It's Time to Drink Coca-Cola
1911 - Real Satisfaction in Every Glass
1912 - Demand the Genuine - Refuse Substitutes

33
1913 - The Best Beverage Under the Sun
1913 - A Welcome Addition to Any Party - Anytime - Anywhere
1914 - Exhilarating, Refreshing
1914 - Demand the Genuine by Full Name
1914 - Pure and Wholesome
1916 - Just One Glass Will Tell You
1917 - Three Million A Day
1919 - Quality Tells the Difference
1920 - Drink Coca-Cola with Soda
1922 - Thirst Knows No Season
1922 - Thirst Can't Be Denied
1922 - Thirst Reminds You - Drink Coca-Cola
1923 - Refresh Yourself
1924 - Pause and Refresh Yourself
1925 - Six Million A Day
1925 - The Sociable Drink
1926 - Stop at the Red Sign
1927 - Around the Corner from Anywhere
1928 - A Pure Drink of Natural Flavors
1929 - The Pause that Refreshes
1930 - Meet Me At the Soda Fountain
1932 - Ice-Cold Sunshine
1933 - Don't Wear a Tired, Thirsty Face
1934 - Carry a Smile Back to Work
1935 - All Trails Lead to Ice-Cold Coca-Cola
1936 - What Refreshment Ought to Be
1936 - The Refreshing Thing to Do

34
1937 - America's Favorite Moment
1937 - So Easy to Serve and So Inexpensive
1938 - The Best Friend Thirst Ever Had
1938 - Pure Sunlight
1938 - Anytime is the Right Time to Pause and Refresh
1939 - Coca-Cola Goes Along
1939 - Make Lunch Time Refreshment Time
1939 - Makes Travel More Pleasant
1939 - The Drink Everybody Knows
1939 - Thirst Stops Here
1940 - Bring in Your Thirst and Go Away Without It
1941 - Completely Refreshing
1942 - Refreshment That Can't Be Duplicated
1942 - Whoever You Are, Whatever You Do, Wherever You May Be,
When You Think of Refreshment, Think of Ice-Cold Coca-Cola.
1943 - The Only Thing Like Coca-Cola is Coca-Cola Itself. It's the Real
Thing
1943 - A Taste All Its Own
1943 - That Extra Something
1944 - How About a Coke
1945 - Passport to Refreshment
1945 - Whenever You Hear "Have a Coke," You Hear the Voice of
America
1947 - Coke Knows No Season
1947 - Serving Coca-Cola Serves Hospitality
1948 - Where There's Coke, There's Hospitality
1949 - Coca-Cola . . . Along the Highway to Anywhere

35
1950 - Help Yourself to Refreshment
1951 - Good Food and Coca-Cola Just Naturally Go Together
1952 - What You Want Is a Coke
1953 - Dependable as Sunrise
1954 - For People on the Go
1955 - America's Preferred Taste
1956 - Coca-Cola - Making Good Things Taste Better
1956 - Feel the Difference
1957 - Sign of a Good Taste
1958 - The Cold, Crisp Taste of Coke
1959 - Be Really Refreshed
1960 - Relax With Coke
1961 - Coke and Food - Refreshing New Feeling
1962 - Coca-Cola Refreshes You Best
1963 - Things Go Better With Coke
1965 - Something More Than a Soft Drink
1966 - Coke . . . After Coke . . . After Coke
1970 - It's the Real Thing
1971 - I'd Like to Buy the World a Coke 1974 - Look Up, America
1976 - Coke Adds Life
1979 - Have a Coke and a Smile
1982 - Coke Is It!
1984 - Just For the Taste of It (Diet Coke)
1985 - Just For the Free of It (Caffeine Free Coke)
1985 - We've Got a Taste For You (New Coke)
1985 - America's Real Choice (Coca-Cola Classic)
1986 - Catch the Wave (New Coke)

36
1986 - Red, White and You (Coca-Cola Classic)
1987 - You Can't Beat the Real Thing
1989 - Can't Beat the Feeling
1990 - Can't Beat the Real Thing
1993 - Always Coca-Cola
1993 - Taste it All

PEPSI-COLA

1903 - Exhilarating, Invigorating, Aids Digestion

1907 - Original Pure Food Drink
1909 - Delicious and Healthful
1915 - For All Thirsts - Pepsi-Cola
1919 - Pepsi-Cola - It Makes You Scintillate
1920 - Drink Pepsi Cola. It will satisfy you.
1928 - Peps You Up!
1932 - Sparkling, Delicious
1934 - Refreshing and Healthful
1939 - Twice As Much For A Nickel Too
1943 - Bigger Drink, Better Taste
1949 - Why take less when Pepsi's best?
1950 - More Bounce to the Ounce
1950 - The Light Refreshment
1954 - Refreshing Without Filling
1958 - Be Sociable, have a Pepsi
1961 - Now It's Pepsi, For Those Who Think Young

37
1963 - Come Alive! You're In the Pepsi Generation
1967 - Taste That Beats the Others Cold
1967 - Pepsi Pours It On
1969 - You've Got a Lot to Live and Pepsi's Got a Lot to Give 1973 -
Join the Pepsi People Feelin' Free
1975 - Have a Pepsi Day
1978 - Catch That Pepsi Spirit
1981 - Pepsi's Got Your Taste For Life!
1983 - Pepsi Now!
1984 - Pepsi, the Choice of a New Generation
1992 - Gotta Have It
1993 - Be Young, Have Fun, Drink Pepsi
1995 - Nothing else is a Pepsi
1999 - The Joy of Cola

38
 CELIBRITIES PLAYING PART IN TO THE SALES
PROMOTION OF THE PRODUCT:

CELIBRITIES OF PEPSI:

AMITABH BACHHAN
SHAHRUKH KHAN
PREETY ZINTA
SACHIN TENDULKAR
SAIF ALI KHAN
SAURAV GANGULY
RAHUL DRAVID
MOHD. KAIF
ZAHEER KHAN
HARBHAJAN SINGH
YUVRAJ SINGH

CELIBRITIES OF COKE:

SALMAN KHAN
AISHWARYA RAI
AMIR KHAN
VIVEK OBEROI
BIPASHA BASU
AKSHAY KUMAR

39
 COKA COLA, PEPSI IN CALORIE BATTLE

Arch rivals plan salvos of new diet colas, Pepsi ONE and Coca-Cola
Zero.
March 22, 2005:

NEW YORK (CNN/Money) - The beverage aisle is about to get more

crowded as Pepsi and Coca-Cola debut new diet colas.

Coca-Cola is adding a fourth diet cola to its line this June with Coca-Cola
Zero, with no calories, the company announced Tuesday. And this spring
Pepsi is relaunching its one-calorie Pepsi ONE with Splenda sweetener
rather than aspartame.

Reformulated Pepsi One, available on shelves and coolers in late March,

is part of Pepsi's focus on diet soft drinks this year, said Katie Lacey, Pepsi-
Cola North America's vice president of carbonated beverages, in a statement

While for Coke, "Coca-Cola Zero is exactly what young adults told us they
wanted," said Dan Dillon, vice president, Diet Portfolio, Coca-Cola North
America, in a statement.

Apparently America's youth wanted a cola sweetened with sugar

subsaspartame and acesulfame potassium. The new cola will not replace Diet

40
Coke, favored by a different group of cola swiggers, according to the
company.

Both Pepsi's (up $0.08 to $52.64, Research) and Coke's (up $0.06 to $41.66,
Research) new diet brews are aimed young adults, mostly male, according to
Adage.com. Apparently, more men are gulping reduced-calorie and zero-
calorie beverages to stay trim, the article says.

Along with Diet Coke and the new Zero, Coke's diet selection includes a
Splenda-sweetened Diet Coke, Diet Coke with lime and C2, launched last
year.

For the curious, Coca-Cola Zero will auction off a sample pack of the cola on
eBay in April.

Coke vs. Pepsi: the new cola wars

NEW YORK (CNN/Money) - The Beatles or the Backstreet Boys? Star Trek or Star
Wars? Yankees or Mets? They say you must like either one or the other.

Shares of Coca-Cola (KO: Research, Estimates) and PepsiCo (PEP:

Research, Estimates) have been on a tear this year, with each posting solid
gains in an otherwise dismal market. Coke has surged 20.3 percent year to
date while Pepsi is up 7.2 percent. The two currently are trading just a hair
off their 52-week highs.

41
But some analysts and fund managers think the trendier Pepsi has more fizz
left in its stock than Coke.

Coca-Cola is launching a new product, Vanilla Coke, next week (May 15)
while Pepsi recently announced that it will start selling a berry flavored cola,
Pepsi Blue, in August. With Vanilla Coke, the company seems to be
banking on nostalgia. (John Travolta's character in "Pulp Fiction" ordered a
Vanilla Coke at a 50's themed diner, for example.)

Pepsi Blue, on the other hand, seems to be a concerted attempt to reach out
to the hipper, younger demographic that drinks Pepsi's Mountain Dew. And
embracing that demographic has worked. The launch of Code Red, a cherry-
flavored version of Mountain Dew, last year helped Pepsi increase its market
share. According to the Beverage Market Corporation, unit volume for all of
Pepsi's soda brands (including Diet Pepsi and Mountain Dew for example)
increased 1.3 percent in 2001 while volume for Coke's carbonated beverage
brands (Diet Coke, Cherry Coke and Sprite among others) declined by .2
percent.

"This is a mistake for Coke. Pepsi is going after the right market. Younger
audiences are going to buy more of Pepsi Blue. I don't see any edge in
vanilla," says Ted Parrish, co-manager of the Henssler Equity Fund. As of
April 30, Pepsi was the fund's second-largest holding. The fund does not
own Coke.

42
BATTLE OF THE BEVERAGES:

43
PEPSI IS NOT AS PRICEY

Regardless of which soda you like better though, Pepsi seems the better
value than Coke right now. Coke is trading at a nearly 20 percent premium
to Pepsi based on 2002 P/Es even though the two companies' earnings
growth rates are nearly identical. (Pepsi's are actually a shade higher.)

And when you look at revenues, the gap is even more dramatic. Coke is
trading at 7 times estimated 2002 sales while Pepsi is trading at 3.5 times
2002 revenue estimates. Both companies are expected to post slight declines
in sales this year and an increase of about 4 percent in 2003. Due to this
disparity in valuation, Jeff Kanter, an analyst with Prudential Securities, says
he has a "buy' rating on Pepsi and "hold" on Coke. Prudential does not do
investment banking.

To be sure, Coke is still the market share leader in soft drinks. One of the
main reasons the stock has outperformed Pepsi this year was because it
reported a better than expected gain in unit volume in the first quarter. And
the company has taken steps to cement its carbonated beverage lead as well
gain ground in the bottled water market. (Coke and Pepsi both have their
own brands of water, Dasani and Aquafina, respectively.)

On Tuesday, Coke announced that it was acquiring the Seagram's line of

mixers, tonic, ginger ale and seltzer from Diageo and Pernod Ricard. And
last month, Coke entered into an agreement with Group Danone to distribute
Evian bottled water in North America.

44
 PRODUCT

The term soft drink was originated to distinguish the flavored refreshment from
hard liquor. Soft drink was flavored to change the habits of earlier Americans
who used to have hard liquor. The fruits and vegetable juices are not considered
soft drinks. Pepsi is a pure soft drink, which is enjoyed in our 195 countries. It
is made of artificial flavors and contains no fruit juice or fruit pulp.

How soft drinks are made:

Soft drink consists of carbonated water and syrup. Adding carbonated gas to
water under pressure produces carbonated water. The gas makes the water
bubble and fizz in most cases. Syrup is made of a concentrate and sweetener. A
concentrate is a blend of flavor and acid. In concentrate for most soft drinks
also include coloring. The concentrate contains a unique blend of ingredients,
which give Pepsi its distinctive flavor. Syrup can be also being prepared
directly from individual ingredients. Carbon dioxide gas gives beverage its
sparkle and tangy taste and prevents spoilage. While it has not been
conclusively proved that carbonation offers a direct medical benefit, carbonated
beverage are also used to alleviate post operative nausea when no other food
can be tolerated. Carbon dioxide is supplied to soft drinks by manufactures in a
liquid form maintained under approximately 1,200 pounds per square inch
pressure in heavy steel containers.

45
Many of the flavorings found in soft drinks come from natural sources such as
fruits juices and oils obtained from roots, citrus fruit peels, and leaves of
various plants. Some flavoring are artificial, but a similar to natural flavoring in
taste. Citric acid and phosphoric acid give soft drink a tart taste. Caramel is
usually used as a coloring in cola drinks. The sweeteners may come from
maize, sugar beet or sugarcane. Artificial sweetener, such as saccharine and
aspartame is used in Diet Pepsi and Diet Coke.

The mixing is carried out under the highest standards of quality control and
accordingly to precise instructions in order to insure that every consumer
always receives a product of the same trusted quality. The bottling of Pepsi in
modern plants such as there are in India is carried out at the rate of 600 bottles a
minutes. Pepsi is approved by the National Health Authorities of every country
in which it is sold.

Packaging
Pepsi is supplied in -
 Returnable glass bottles (200 ml, 250 ml, 300 ml, 500 ml, 1 lt.)
which is supplied in molded plastic shells.
 1.5 litre PET bottles,
 330 ml of cans,
 PMX machines (Fountain Pepsi)

Fountain Pepsi (F P) Dispenses soft Drinks in plastic cups. There are two
methods of vending soft drinks.

46
1. Pre-mix system - In the premix system, the finished beverage is
prepared by the soft drink manufacturers and filled into 5 to 10 gallon
stainless steel tanks. The tanks of the beverage are attached to the vending
machine where the beverage is cooled and dispensed.

2. Post-mix system - In post-mix system the vending machine has its

own water and carbon dioxide supply. The water is supplied through Aqua
Guard purifier and is carbonated as required by carbon dioxide cylinder. It is
then mixed with concentrate or flavored syrup which is kept in BIB (Bag in
Box) as it is dispensed into the cup. Pepsi has post mix vending machines
and coke has pre mix vending machines.

Cans & Bottles - Among the different packages in the market in the next
couple of years could be cans and pet bottles - apart from the standard glass
bottles. One of the standard packages that one is likely to see in the coming
years is buying more at lower price. Pepsi introduced 200 ml bottles of Pepsi
at the price of Rs.6. It was an instant hit while packages of those kinds are
also being worked out keeping in view of the rural market. But it could also
lead to the killing of the standard 300 ml size bottles that is in vogue now.
The consumer would get a choice of soft drink at a cheaper and an
affordable price - even if it means breaking of certain standards shapes and
sizes of the packages. The broad strategies of both penetrating the market are
still being made. And the amount of thought that is going into it can be made
out from the very fact that the manufacturers are thinking of such
innovations as the “picnic packages” of the brand for those on holiday trip.

47
The battle will be engrossing as packages will be brought to the market and
be pulled by the competing rivals. There would be price wars and
competitions on qualities.

In the US, 55% of the carbonated soft drink (CSD) is sold today in
returnable bottles, 30% on one-trip containers and 15% through vending
machines and fountain. In other parts of the would, Pepsi are sold mainly in
returnable bottles. Pepsi in cans are more popular in countries such as US,
Canada, Australia, Philippines and England. Canned Pepsi is also sold in
India.

48
Brands –
The current Indian market consists of seven-flavor segment. Cola segment is
by far the most widely consumed soft drinks.

SEGMENT BRAND
COLA PEPSI
ORANGE MIRANDA
CLOUDY LIME MIRANDA
LEMON
CLEAR LIME 7-UP
SODA EVERESS
MANGO SLICE

In addition to these segments, Pepsi has developed wide range of

soft drinks such as Diet Pepsi, Caffeine Free Pepsi and low sodium Pepsi,
Sugar Free -Pepsi Max.

49
 CHARACTERISTICS OF THE PRODUCT

These are some of the unique characteristics of the products:

1. Package is returnable and vulnerable to breakage.
2. Weight of package is twice as much as that of the product.
3. Has a seasonal demand resulting in partial idling of the distribution
network.
4. Demands highlight intensive availability of the product with very low
dealer index essential on account of “impulse demand”.
5. Occupies more shelf space (or cooler space) per a rupee worth of
investment than most other brand product. This factor, coupled with
the return ability of the container, involves a very high level of service
frequency.
6. Ratio of distribution costs to selling price is higher than for any other
branded mass consumption product.
All these point to the fact that a penetrating distribution network
coupled with efficient feeding are the only means to higher sales.

50
 PREFERENCE OF SOFT DRINKS IN A DAY

Once a day 25%

Twice a day 20%
Once a week 5%
Other 50%

60%
50% 50%
O nce a day
40% T w ic e a d a y
O nce a w eek
30%25%20% O th e r
20%
10% 5%
0%
O n c e Taw ic eO an c e Oa t h e r
day day w eek

Figure-1

51
 PREFERENCE TO THE BRAND

Pepsi 60%
Coke 40%

80%
60%
60%
40%
40%
20%
0%
P epsi Coke

P e p s iC o k e
Figure – 2

52
 TO GIVE THE PREFERENCES

More Popular 10%

Packaging 10%
Taste 70%
Price 10%

80% 70%
60%
40%
20% 10% 10% 10%
0%
M o re P a c k a g in Tg a s t e P r ic e
P o p u la r

M o r e P o p uPlaa rc k a g inT ga s t eP r ic e
Figure – 3

53
MARKETING STRAGGLES OF COMPANY EFFECTS THE
SALES

Yes 55%
No 45%

60% 55%
50% 45%
40%
30%
20%
10%
0%
Y es No

Y es No
Figure – 4

54
 FORM OF MARKETING STRATEGIES

Television Advertising 45%

Newspaper Advertising 5%
Outdoor Advertising 20%
Sales Promotion 30%

50% 45%

40%
30%
30%
20%
20%

10% 5%

0%
T e le v is io n AN de vw . s p a p e r OA ud tvd o o r A Sd va le s P r o m o t io n
T e le v is io n A Nd ev w. s p a p e r OA udtvd o o r A Sdav le s P r o m o t io n
Figure – 5

55
CHANGE BRAND ON THE BASIS OF PRICE REDUCTION

Yes 51%
No 49%

Y es No

52%
51%
51%
50%
49%
49%
48%
Y es No

Figure – 6

56
 MORE EFFECTIVE ADVERTISING

Pepsi Co. 60%

Coke Co. 40%

80%
60%
60%
40%
40%
20%
0%
P epsi Co. Coke Co.

P e p s i C oC .o k e C o .
Figure – 7

57
CREATIVE AND APPEALING ADVERTISING OF THE
SOFT DRINK COMPANY

Pepsi Co. 70%

Coke Co. 30%

80% 70%
60%
40% 30%

20%
0%
P epsi Co. Coke Co.

P e p s i C oC .o k e C o .
Figure – 8

58
 INNOVATIVE AND EXCITING OFFERS

Pepsi Co. 55%

Coke Co. 45%

60% 55%
50% 45%
40%
30%
20%
10%
0%
P epsi Co. Coke Co.

P e p s i C oC .o k e C o .
Figure –9

59
 MARKET SHARE PERCENTAGE IN BANARAS

Pepsi 56%
Coke 35%
Pure Drinks 9%

9%

35% 56%

P e p s iC o k e P u re D rin k s

Figure - 10

60
MARKET PERCENTAGE SHARE IN ALL OVER INDIA
2004

Pepsi 44%
Coke 51%
Local Brand 5%

5% 44%

P epsi
51% Coke
L o c a l B ra n d

Figure - 11

61
 BRAND PREFERENCES

In a survey done by A & M magazines on the best marketing companies in

India. Pepsi and Coca-Cola were also entered. The results were as follows:

Pepsi - 4th

Coca-Cola - 11th

The results of 95 were :

Pepsi - 7th

Coca-Cola - 11th

This shows that both the companies are paying more attention to the
marketing of their products. Pepsi is higher up on the scale than Coca-Cola.
We can see that by the brilliant advertising done by Pepsi, which can be seen
on every hook and corner of NCR. The consumers also prefer Pepsi
advertisements and other activities of Pepsi, to that of Coca-Cola.

62
 FINDINGS & ANALYSIS
The Indian soft drinks market is at 140 million cases per year. This is very
low, even as compared to Pakistan and Bangladesh. All these factors
together have contributed to a 20% growth in the soft drinks industry.. If this
demand continues to grow at 20% grow at 20% annually, within 10 years the
volumes could reach 1 billion cases. This kind of growth is the reason for
the entry of the two giants of the soft drink industry of the world.

• Coca-Cola

• Pepsi

Coca-Cola and Pepsi together control 97% of the 4 entire Indian markets.
The rest of the 3% is shared by companies like Cadbury-Schweppes and
Campa-Cola. The total no. of case sold is 140 million of these 77 million
cases of Cola drinks are sold and 63 million of non-cola drinks. There is a
rapid increase in the sale of cola soft drinks. Whereas in 1990, they
accounted for a third of all soft drinks sold, now their share is well over half.
Also cola sales are growing at a faster rate than non-colas. One of the
reasons for this could be the aggressive marketing strategies for Cola drinks
by Pepsi and Coca-Cola.

The race to quench the great Indian thirst had design.

63
Market Share Percentage in NCR -2007

10%

55%
35%

Pepsi Parle & Coke Pure Drinks

Pepsi findings:

Pepsi is the largest selling soft drink in India today. In NCR it has 55% of
the market share. In India it has 43% of the market share making it the
largest selling soft drink, but the second largest company in terms of sales.

The sales of Pepsi is approximately Rs. 1,000 crore annually in India of this
only about Rs. 30 crore annually is credited to the foods section of Pepsi.
The rest is all earned by the soft drinks.

The soft drinks in Pepsi Foods LTD include:

1. Pepsi Cola

2. Mirinda Orange

3. 7-Up

4. Mirinda Lemon

64
The main advantage the Pepsi has over its nearest competitor i.e., Coca-Cola
is that of its was the first multinational to enter India, in the soft drinks
sector. Pepsi officials and ‘Dial-a-Pepsi’ scheme to grow the market, instead
of giving discounts at the retail level. Another point which attributed to
Pepsi’s success is the bottling operations. Pepsi does most of its bottling on
its own. Another significant investment of Pepsi has been fountains.
Fountains have considerably increased sales of Pepsi, as they have offered
consumers a whole new way to experience soft drink. According to a study
done, 80% of all soft drinks are consumed on premise, at the point of
purchase, rather than at home; thus the fountain initiative has paid off.

Thus we see that Pepsi has followed aggressive marketing strategies making
themselves get into the minds of the consumer by being visible inside and
outside the consumers home by way of television, radio Newspapers,
hoarding, sales-promotion schemes, etc. Pepsi has been voted the number
one customer service company across categories in terms of regularity,
availability responsiveness and initiative.

65
PUBLIC RELATIONS ANGLE
Innovative and exciting offers

The respondents were asked to compare between PepsiCo and Coca-Cola [I]
Ltd. in terms of who comes up with innovative and exciting offers, or rather
things which are lively and interesting to participate.

50% of the respondents, replied in favour of PCI while 30% responded in

favour of CCI. 17% of the respondents thought that both were equally good
and it varied with time, place and occasions. 3% of the respondents were not
aware of all the activities and were modest to admit it.

Quick and responsive to different occasions and events.

Comparing PepsiCo and Coca-Cola[I]Ltd, 55% of the respondents replied

that it was undoubtedly PepsiCo. They supported their statement with
reasoning, saying so that PepsiCo was first to associate with India’s 50 years
of independence.

On the other hand 22% of the respondents felt that Coca-Cola[I]Ltd. is not
trailing back. It sponsors mega events like different Cricket tournaments,
Olympic games, World Cup Football etc.19% of the respondents came up
with a more balanced answer. They said if one of the companies sponsors
one event its sure that the other will definitely go on for the next. Its a tough
tussle and is really difficult to demarcate today.

Future leader in the market

When the respondents were asked about their perceptions, as who would be
the future leader in the market, 42% of the respondents replied in favour of

66
PepsiCo. According to them PepsiCo has entered Indian market prior to
Coca-Cola [I] Ltd. and has strong foothold now. Above that it is innovative
and there is freshness in its Ads. The only thing required is to maintain its
position.38% of the respondents claimed that after taking over Parle
Industries Coca-Cola [I] Ltd. is in a comfortable position. If it can promote
brands of Parle Industries like Thums Up and Limca which has a substantial
market in India, it may turn out to be the leader in future.

Again 15% of the respondents feel that both the companies are fighting tooth
and nail for supremacy. The one which commits an error in its strategy will
trail behind.

67
 CONCLUSION
Pepsi is the market leader in terms of soft drinks in India, but comes second
to Coca-Cola which consists of Coca-Cola and park brands.

However in NCR it is the market leader. Pepsi’s main target is obviously to

be the market leader and leave its nearest competitor, Coca-Cola, far behind.
To achieve this Pepsi seems to be relying on mass advertising. They spend
about 50-60 crore rupees annually on marketing activities. The consumer is
bombarded with Pepsi advertisements, sign, logo’s etc., everywhere.

Pepsi’s core market is the young –adult and Pepsi is taking great measures to
change the perception of these young-adults., Pepsi wants that these
consumers should associate all colas as Pepsi, the brand Pepsi and cola
should be synonymous with each other. This they are trying to do by getting
the heros of these consumers to endorse their product e.g. Sachin Tendulkar
and also by advertising for and by youngsters.

Pepsi drinks are available in almost the whole of India, this shows the
importance paid to distribution. Brand loyalists are very few in the market.
Thus the drink should be easily available, so that consumers cannot shift
their preferences.

Consumers

For the purpose of the study, questionnaires were prepared for the
Consumers. Care was taken to interview all types of consumers, i.e.,:

a. Different age groups

b. Males and females

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c. People from different localities, etc.

In all about 60 consumers were interviewed. The conclusions that one can
draw from these answers provided by the consumers showed that marketing
activities do form a major part of the decision.

One thing that was common amongst all the consumers who were once a
day or once a week. The most important factor the influences a customer
while buying a soft-drink was taste. This was true for all the consumers who
were interviewed. The rest of the conclusions as deducted from the
questionnaires are as follows:

The younger generation preferred soft drinks to the older generation.

a. Children up to 15 years of age liked to have soft drinks upto 2-3 times a

day.

b. Young adults liked to have soft drinks up to 1-2 times a day.

c. Adults liked to have soft drinks about once or twice a week.

Children preferred Coca-Cola Fanta, Mirinda orange. Young adults liked

Pepsi. The older generation preferred Coca-Cola, Limca & Mirinda Lemon.

The reason given for choice of facourite soft drink was taste and easy
availability. Only if the consumer liked the taste of drink, he would have it
again.95% of the consumers felt that marketing strategies of the company
did affect the sales of their soft-drink.

Marketing strategies made the consumer try a drink for the first time. The
second time round it was the consumers choice himself and not strategy
could affect that. Youngsters were more acceptable to change. They tried

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different drinks, Cola and non-Cola. Adults stick to one and they prefer
drinks that do not affect their health, like Limca.

Major number of people found television advertising to be the most

effective. Young and the old, all liked to watch the advertisements on
television.

Sponsoring events, outdoor advertising and sales promotion schemes were

second choice of the consumers. Under television advertising, Pepsi came in
as the number 1 favorite of the people the advertisement of Shah-Rukh Khan
and the dog was the favorite of the consumers. Their new advertisement of
Mirinda Lemon is also lifted by the people. The advertisement that came in
second was, the Coca-Cola advertisement of the people Cricket and the song
Must-Kalander going on at the back. These, advertisement remained most in
the minds of the people.Most of the consumers felt that Pepsi was the market
leader in the soft-drink industry, in NCR as well as in India. Whereas while
Pepsi is the leader in NCR, in India Coca-Cola is number one.

99% of the consumers interviewed felt that the marketing strategies of the
Coca-Cola and Pepsi have helped them in attaining the huge market share
that they possess. Women and children prefer cans as compared to men.
These are the major conclusion that can be drawn about a consumers’
behavior. Companies must take the initiative of finding out the habits of the
consumers and then changing them, in their favor.

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 RECOMMENDATIONS
Soft drinks are an impulse product. When a person is thirsty, he would first
think of water or tea. Some even would prefer ‘Nimbu Pani’.

The Indian population is the largest in the world today; there can be no other
country in the world, which provides so much of an opportunity for the soft-
drink manufacturers. The Indian soft drink market is at 140 million cases per
year, this is very low. Thus the consumption of soft drink can go up.

Sinc118+e the entry of Coca-Cola into the country the industry is growing at
a rate of 20% annually. If this rate is maintained, then by the year 2005 the
market of soft drink would be 1 billion cases annually.

However Coca-Cola wants to accomplish this feat by themselves. To do this

the industry has to take certain steps. All the companies are fighting to get a
major share of this growing market. They should all try to increase the total
market along with their individual shares.

On the basis of all the field work and table work done, some suggestions can
be made, which may help the company in increasing the total market as well
as the sale of the companies. The various suggestions that can be made are
as follows:-

Soft drinks retail at prices between Rs. 6 and Rs. 10. These are expensive
when measured against purchasing power.

According to one study, it takes an Indian 50 minutes of work to be able to

buy a bottle in other countries, the norm is five minutes. Thus to increase the
total market of soft drinks, manufactures should try and decrease the prices,
so as to increase sales.

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Availability is a major factor, which makes the consumer buy a soft drink.
Soft drinks should be made available more readily than present. There are
only 300, 000 retailers stocking soft drinks in India. Thus retailing outlets
should be increased. Also related to this point, is vending machines. In
developed machines, vending machines are kept in all consumer areas, like
super markets, schools, amusement parks, local markets, etc. These tempt a
person into buying the soft drink. So if vending machines are put in strategic
areas, it would definitely increase consumption of soft drinks.

Soft drink cans which are very convenient, as the consumer can take them
anywhere, unlike a bottle, are very expensive retailing from Rs. 15-Rs. 18.
To increase sale of cans, this price should be brought down.

Innovations increase sales of company. For e.g. fountain Pepsi increased

sales of Pepsi Cans increased sales of Coca-Cola. Thus the companies
should constantly come out with innovative ideas.Example-300 ml plastic
bottles, which the consumer can take with him, unlike the glass bottles,
which he has to return. Plastic bottles can even be used again by households
for various purposes.

The companies should conduct studies to get to know about consumer

habits. For e.g. Coke knows that Americans see 69 of its commercials every
years , put 5.2 ice cubes in a glass and prefer cans to pop out of vending
machines at a temperature of 35 degrees.

If the companies know all this and more about Indian consumer behaviour, it
could tell them how to sell their drinks, so as to increase sales.

It is seen In India, that people prefer having their drinks with or after food.
Companies could have commercials which show people enjoying their drink

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with a good meal, so that consumers associate drinking soft drinks while
having food.

Companies should try to educate the consumer about the health related
subject. For e.g:-

a) Limca is recommended to patients by doctors.

b) Cola drinks are known to be very fattening ,

But in fact cola drinks contain no calories from fat they contain calories
from sugar which can be easily burned off. The soft drink cans and plastic
bottles should mention the calories and other related information on the
packing.

Companies should try to build high brand equity. This provides a number of
advantages to the company.
a) The company enjoys reduced marketing costs because of high level of
consumer brand awareness and loyalty.
b) The company will have more trade leverage in bargaining with
distributors and retailers since the customer expects them to carry the
brand.
c) The company can change a higher price than its competitors because the
brand has higher perceived quality.
d) The company can more easily launch brand extension.
e) Above all, the brand offers the company some defence against fierce
price competition.
The companies should go in for diversification

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Once the brand is known, it is easier to sell more of its products. For e.g.
Coca-Cola clothes have sold about $100 million worth of clothes and
accessories. This would increase revenues of the company.

The companies should not have competitor myopia. It is more often the
latent company than the current competitor who busies the company. Pepsi
and Coca-Cola are so busy fighting with each other, that they have left the
non-cola sector open for Cadbury-Schweppes.

Advertising is a way building brand image. It does not promote quick

selling. Thus companies should used advertising only for long advertising
can be used for:

a) Brand image building

b) Reminder advertising :reminding people to buy these drinks.
c) Reinforcement advertising-Telling people that they have made the right
choice.

Television advertising seems to make a impact on the consumers (based on

questionnaire answers) so companies should concentrate more on television
advertisements.

Sales promotion tools create a stronger and quicker response. Thus sales
promotion tools such as coupons, contests, premiums and the like should be
used to dramatize product offers and to boost sales. Sales-promotion effects
are usually short run and induce the people to purchase soft drinks, now.

Coca-Cola and Pepsi have taken up sponsoring of events on a major scale.

All kinds or events, whether big (Wills Worked cup) or small (college
contests) have either Pepsi or Coke banners of sponsorship. The

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effectiveness of this can be questioned. Whether these activities increase
sales or not is a big huge question mark.

PepsiCo and Coca Cola (I) Ltd. should reduce their massive spending on
sponsoring events and try and channel this money into more productive
activities, like innovative packaging etc.

It is recommended that company should introduce more and more customer

oriented schemes and contexts. For e.g. Pepsi’s new campaign “Pepsi cool
mal” in which they are giving free gifts to their customers.
The company should maintain a small group of “missionary sales man”
whose functions should be to guide distributors and retailers, keep a constant
watch over the prevailing situation to provide the continuous feedback to the
company.
It is also recommended that companies should launch soft drink in small
pack 200 ml and 150 ml.
Thus we see that there various steps which can be taken by the companies to
increase their sales and to increase the total market share.

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 BIBLIOGRAPHY

 Marketing Management- By Philip Kotler

 Business world

 Out look

 Times of India

 Course pack of Rai university

 www.Pepsico.indialtd

 Research methodology- By C. R. Kothari

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 QUESTIONNAIRE
Q.1. WHICH BRAND WILL YOU PREFERENCE OF SOFT DRINKS
IN A DAY?

Once a day
Twice a day
Once a week
Other

Q.2. WHICH BRAND ARE YOU PREFERENCE TO THE BRAND?

Pepsi
Coke

Q.3. WHICH PARTICULAR RATE TO GIVE THE PREFERENCES?

More Popular
Packaging
Taste
Price

Q.4. ARE THE MARKETING STRAGGLES OF COMPANY

EFFECTS THE SALES?

Yes
No

Q.5. WHICH FORM OF MARKETING STRATEGIES IS MOST

EFFECTIVE IN THE MARKET?

Television Advertising
Newspaper Advertising
Outdoor Advertising
Sales Promotion

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Q.6. WILL YOU CHANGE THE BRAND ON THE BASIS OF PRICE
REDUCTION?

Yes
No

Q.7. WHICH BRAND MORE EFFECTIVE IN ADVERTISING?

Pepsi Co.
Coke Co.

Q.8. WHICH BRAND HAS CREATIVE AND APPEALING

ADVERTISING OF THE SOFT DRINK COMPANY?

Pepsi Co.
Coke Co.

Q.9. WHICH BRAND HAVING THE INNOVATIVE AND EXCITING

OFFERS?

Pepsi Co.
Coke Co.

Q.11. WHICH BRAND HAVING THE MARKET PERCENTAGE

SHARE IN ALL OVER INDIA?

Pepsi
Coke
Local Brand

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