Market Analysis On Pepsi 6g2g54

1. INTRODUCTION According to the marketing strategies used by Pepsi, Customers will have diverse experiences and preferences, given their individual references and location. The Pepsi Company is modifying its approach so that it can strike into these distinctions and provide the fitting marketing activities, pricing strategies and beverages to be connected with current and potential customers. Its "think local, act local" strategy to marketing permissible adopting communications to suit local and global situations. It wants to offer consumers with beverages to be adaptable with their different life styles and life stages. Pepsi is placing more liability and answerability in the hands of its managers who are closest to the target market, to create good channels of communication, and gain its loyalty, and achieve the company marketing and overall goals. Pepsi thrives when people are permitted to utilize their insight to construct the business in ways best suitable to their culture and business conditions. Efforts were made to give flexibility to managers to be adaptable with the market shocks, and try to make the significant modifications. Moreover P& G used to utilize a flexible pricing strategy to avoid any loss in market share to other rivals. it depends in certain scenarios to price its products low and obtain maximum profit on spare parts, in addition it uses different prices and different price lists for different markets to extract the fitting one .In other scenarios, it sets price for selected products at 10% below market leader to maximize sales, and to allow increased production and reduce unit production cost. In recent years a rapid health growth was witnessed in the Indian food sector, along with a few of the local companies reporting massive growth. The food and beverage industry is being reinforced by the Saudi government by offering financings and grants on designated equipment, and through the burden of high prices on imports that competes with local products. Important sub segments in the India’s food and beverage processing industry, comprising meat, dairy, and juice business, which has established to a degree in current years to the point where they are meeting most of the local demand.

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1.1 INDUSTRY PROFILE Around 1984 the first branded soft drink came in the Indian market. This soft drink was named as gold spot. Before Coca-Cola entered the country to dominant the scene in 1950’s, Parley exports Pvt. Ltd were the first Indian company to introduce a lemon soft drink, this drink was known as Limca and it was introduce in 1970’s. However, before this they had introduced cola piping, which was withdrawn in face of tough competition from coca-cola. In the year 1977 coca-cola left Indian market and this brought in an opportunity for various Indian companies to show their caliber, at this time a new soft drink was introduced by parley product and this was named thrums up. This was Coca-cola drink, which had a burnt sugar color. This drink was introduced with a mighty “happy days are here again”. As if happy days went away with coca-cola .There was another company named pure drinks, which introduced the soft drink named campa-cola along with orange and lemon flavors. Just after this many more companies entered the Indian soft drink market. A soft drink named double-7 had been introduced by a company modern baker. Another company, Mohan meckins also came with a softy drink named marry & puck up. Mcdowell came with thrill, rush and sprit. Previously there was no competition in the Indian soft drink market but with all these companies coming in the Indian market a huge competition was a place with high voltage ment. But in the year 1988 Pepsi was given permission to sell its soft drinks in the Indian market by the government of India. Coca-cola also co history of soft drink come back 1993. Soft Drink Market Indian Scenario Indian soft drink industry is witnessing a boom time. Its growth rate is around 20% with such a high growth rate, volume could reach billion crates with 10 years .Three major multinational companies are fighting to grab a major chunk of business from Indian markets. These three major multinational companies are fighting to grab a major chunk of business from Indian markets. These three coca-cola, Pepsi, Cadbury. All of these companies have seen an enormous 2

potential in this country .Consequently, by world standard India per capita consumption of soft drinks is still very low. Therefore these soft drinks grants feel that fire capita consumption can only grow up. Soft drinks industries has already seen and estimated sale of around 240 million crates higher than last year’s sale of 204 million in 1998. The main reason for such a high growth rate heightened competition between Coca-cola and Pepsi, Cadbury, being a new entrant is for behind. India is actually more vivid in taste and preference than any other country market. Delhi jar instance, s for about 20% of total soft consumption in of sales. There are about 4, 80,000 soft drinks retailers in India and their numbers are increasing day by day. This actually means that there is just one soft drink retailer on a population of 37,600, which is far below the international standard. Where as Philippines has one soft drink retail counter over a population of 150 people i.e. 4, 00,000 outlets on population of 60 million. Soft drinks shows strong double-digit growth In 2011, soft drinks ed a higher off-trade value growth rate than the review period average. This growth was attributable to strong double-digit performances in sectors such as sports and energy drinks, bottled water and fruit/vegetable juice, which had a good year due to rising mercury levels. Long summers and higher disposable incomes are the main growth drivers for the soft drinks category. Fruit/vegetable juice outshines carbonates in of growth Fruit/vegetable juice showed considerably stronger growth than carbonates, being viewed as a healthier alternative. Soft drinks giants Coca-Cola India Pvt Ltd and pepsico India Holdings Pvt Ltd have recognised this trend and are strengthening their product offerings in fruit/vegetable juice. With a focus on healthy diets, consumers in urban areas are slowly shifting from carbonates to fruit/vegetable juice, which also received a major growth boost from on-the-go consumption.

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Coca-Cola and PepsiCo compete through lemonade/lime carbonates Lemonade/lime carbonates was among the stronger performers in the carbonates category in 2011. Coca-Cola India Pvt Ltd and PepsiCo India Holdings Pvt Ltd continue to compete aggressively in this category by increasing the visibility of their brands Sprite, Limca and 7-Up respectively. Catchy taglines were used by manufacturers to generate consumer interest, alongside aggressive campaigns using Bolly wood actors. Modern retail shows steady growth Leading chained retailers are on a major expansion drive, which has led to an increase in soft drinks volume sales. Manufacturers have leveraged this to showcase their new variants in a bid to broaden their consumer base. The modern retailing channel is helping to facilitate the growth of soft drinks. Modern retail offers a unique experience for consumers, where they can touch and feel the product before buying. Tier two and three cities have also seen the robust growth of modern retail outlets. Indians will continue to consume more soft drinks Dynamic products such as sports and energy drinks, bottled water and fruit/vegetable juice will drive strong growth in soft drinks during the forecast period. Soft drinks giants pepsico India Holdings Pvt Ltd and Coca-Cola India Pvt Ltd are targeting the rural segment to enhance their presence. The outlook for soft drinks looks very positive in the forecast period due to strong marketing activities and product innovations by manufacturers.

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1.2 COMPANY PROFILE One of the dynamic industries in our country is the soft drink industry. Soft drinks are a nonalcoholic beverage made with carbonated water. Such drinks are called soft to distinguish them from Alcoholic or hard drinks. Soft drinks are also called pop because the type of bottle caps used before 1890’s made a popping noise when removed. People in various areas call soft drinks as soda.

Most soft drinks are sweetened and flavored with specially prepared syrup, the

flavoring are usually made from various plant part such as root, bark and seeds of cola tree. Most brands of soft drinks were manufactured through franchised bottle with a security formulated beverage syrup or flavor base. Mr. Joseph Priestly, an English Chemist, produced the first artificially carbonated water in the year 1772. At that time mineral water was a popular remedy for certain diseases. Previously artificial mineral water was also called as soda water. In 1806 bottled soft water was produced and sold by Mr. Benjamin Sill man, a Chemistry Professor at Yale College. The number of soft drink bottling company in the United States increased approximately from 65 to 2000, during 1970’s increased in the price of soft drinks. Many people switched to less expensive noncarbonated soft drinks, produced using powdered mixes which became an important part of an industry Corporate Overview Pepsico was incorporated in the year 1919 and was re-incorporated in North Carolina in 1986. Pepsi is engaged in beverage and snack food business. Pepsico is a multinational company and it is most successful consumer product company in the world with annual revenue of $ 20 billion and about 1, 43,000 employees. Some of pepsico’s brand names are nearly 100 years old. Pepsico has achieved a leadership position in each of the two major packaged good business i.e. Beverage and snack chips. Pepsico the conglomerate king of soft drink has its wide range of soft drinks products available in every book & corner of the world.

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The Indian Story Pepsi & Co came to India as food processing unit, Punjab during the year 1986-87 head office Pepsi food unit situated in Delhi, employees are more than 2500 people. Pepsi co today is the leader in the cola and orange segments of beverages in India and enjoys leadership in soft drinks in many parts of the country. It focuses on execution excellence, strengthen, bottle network, reach and penetration in rural and semi-urban areas and customer focused marketing areas. Pepsico is a global food and beverage leader with net revenues of more than $65 billion and a product portfolio that includes 22 brands that generate more than $1 billion each in annual retail sales. Our main businesses – Quaker, Tropicana, Gatorade, Frito-Lay and Pepsi-Cola – make hundreds of enjoyable foods and beverages that are loved throughout the world. Pepsico’s people are united by our unique commitment to sustainable growth by investing in a healthier future for people and our planet, which Pepsi believe also means a more successful future for pepsico. Pepsi call this commitment Performance with Purpose: pepsico’s promise to provide a wide range of foods and beverages for local tastes; to find innovative ways to minimize our impact on the environment by conserving energy and water and reducing packaging volume; to provide a great workplace for our associates; and to respect, and invest in the local communities where Pepsi operate Mission We have absolute clarity about what we do ‘WE SELL HIGH QUALITY FOOD AND BEVERAGE PRODUCTS’. Our success will ensure: customers will build their business, employees build their futures, and shareholders build their wealth. Vision Pepsico's responsibility is to continually improve all aspects of the world in which we operate social, economic - creating a better tomorrow than today.

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Products in India 1. 7UP 2. Aliva 3. Aquafina 4. Cheetos 5. Duke’s 6. Gatorade 7. Kurkure 8. Lay’s 9. Lehar 10. Mirinda 11. Tropicana 12. Nimbooz 13. Pepsi 14. Quker oats 15. Slice 16. Tropicana 17. Uncle chipps Brand History

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Tropicana was founded in Bradenton, Florida, USA, in 1947. It is now enjoyed almost everywhere in the world. Carefully nurtured for over 50 years, Tropicana has matured into one of the most respected beverage brands. Tropicana is the #1 brand in packaged 100% Juice in the world in 2011 in off-trade volume. It is today available in 63 countries. Since 1998, Tropicana has been owned by pepsico, Inc. Tropicana Gold was re-launched as Tropicana 100% in 2008. Brand Advantage Tropicana continues to select the best fruit to manufacture high-quality juices and original products, pioneer innovative processes and explore new markets for its products. It is committed to fostering healthy lifestyles by ensuring that its products are naturally nutritious and provide the daily benefits that one needs. In India, Tropicana comes in two categories: 100% Juices (sold as Tropicana 100%) and Juice Beverages (sold as Tropicana). Quick Brand Facts 1. Launched in India in 2004. 2. Available in two categories - 100 percent juice and juice-based drinks.

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1.3 PROBLEM STATEMENT Estimating the market or market potential for a new business or business expansion is critical in determining the economic feasibility of a venture. Estimating the market potential for a business is critical in evaluating its viability and provides an estimate of the maximum total sales potential for a given market. Estimating the market potential will determine if the market is large enough to your business. Hence we get precise and reliable information in this area after conducting a market potential analysis.

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1.4 NEED FOR THE STUDY This study is bases on maximum demand response possible for a given group of customers within a well defined geographic area for a given product or service over a specified period of time under well defined competitive environmental conditions

1.5 OBJECTIVES OF THE STUDY 1. Gaining a better understanding on the market strategies and planning used by the company for marketing the product of Tropicana. 2. Comprehending how key trend affects the industry and Tropicana as one of PepsiCo’s products and how a consumer buying behavior affects the product. 3. To Understand and differentiate between the market segmentation, positioning and target audience in order to develop an effective marketing plan, and achieve the overall objectives of the company. 4. Examining the pricing plan designed for Tropicana and gives recommendations to help increase its sales size. 5. Understanding how and what are the tactics to eradicate Tropicana’s strong competition is the main reason of this report.

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2. LITERATURE REVIEW The soft drink industry is very competitive for all corporations involved, with the greatest competition being that from rival sellers within the industry. All soft drink companies have to think about the pressures; that from rival sellers within the industry, new entrants to the industry, substitute products, suppliers, and buyers. The competitive pressure from rival sellers is the greatest competition that Coca-Cola faces in the soft drink industry.

Coca-Cola, Pepsi Co., and Cadbury Schweppes are the largest

competitors in this industry, and they are all globally established which creates a great amount of competition. Though Coca-Cola owns four of the top five soft drink brands (Coca-Cola, Diet Coke, Fanta, and Sprite), it had lower sales in 2005 than did PepsiCo (Murray, 2006c). However, Coca-Cola has higher sales in the global market than PepsiCo. In 2004, PepsiCo dominated North America with sales of $22 billion, whereas Coca-Cola only had about $6.6 billion, with more of their sales coming from overseas. PepsiCo is the main competitor for CocaCola and these two brands have been in a power struggle for years (Murray, 2006c). Barbara Murray (2006c) explained the soft drink industry by stating, “For years the story in the nonalcoholic sector centered on the power struggle between…Coke and Pepsi. But as the pop fight has topped out, the industry's giants have begun relying on new product flavors…and 11

looking to noncarbonated beverages for growth.” In order to fully understand the soft drink industry, the following should be considered: the dominant economic factors, five competitive sources, industry trends, and the industry’s key factors. Based on the analyses of the industry, specific recommendations for competitors can then be created. Dominant Economic Factors Market size, growth rate and overall profitability are three economic indicators that can be used to evaluate the soft drink industry. The market size of this industry has been changing. Soft drink consumption has a market share of 46.8% within the non-alcoholic drink industry, illustrated in Table 1. Datamonitor (2005) also found that the total market value of soft drinks reached $307.2 billion in 2004 with a market value forecast of $367.1 billion in 2009. Further, the 2004 soft drink volume was 325,367.2 million liters (see Table 2). Clearly, the soft drink industry is lucrative with a potential for high profits, but there are several obstacles to overcome in order to capture the market share. The growth rate has been recently criticized due to the U.S. market saturation of soft drinks. Datamonitor (2005) stated, “Looking ahead, despite solid growth in consumption, the global soft drinks market is expected to slightly decelerate, reflecting stagnation of market prices.” The change is attributed to the other growing sectors of the nonalcoholic industry including tea and coffee (11.8%) and bottled water (9.3%). Sports drinks and energy drinks are also expected to increase in growth as competitors start adopting new product lines. Profitability in the soft drink industry will remain rather solid, but market saturation especially in the U.S. has caused analysts to suspect a slight deceleration of growth in the industry (2005). Because of this, soft drink leaders are establishing themselves in alternative markets such as the snack, confections, bottled water, and sports drinks industries (Barbara Murray, 2006c). In order for soft drink companies to continue to grow and increase profits they will need to diversify their product offerings. The geographic scope of the competitive rivalry explains some of the economic features found in the soft drink industry. According to Barbara Murray (2006c), “The sector is dominated by three major players…Coca-Cola is king of the soft drink-empire and boasts a global market share of around 50%, followed by PepsiCo at about 21%, and Cadbury Schweppes at 7%.” Aside from these major players, smaller companies such as Cott Corporation and National Beverage Company make up the remaining market share. All five of these companies make a portion of their profits outside of the United States. Table 3 shows that the US

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does not hold the highest percentage of the global market share, therefore companies need to be able to compete globally in order to be successful. Table 4 indicates that Coca-Cola has a similar distribution of sales in Europe, NorthAmerica, and Asia. On the other hand, the majority of PepsiCo’s profits come from the United States (see Table 5). Compared to PepsiCo, Cadbury Schweppes has a stronger global presence with their global mix (see Table 7). Smaller companies are also trying to establish a global presence. Cott Corporation is a good example as indicated in Table 8. The saturation of the US markets has increased the global expansion by soft drink leaders to increase their profits. The ease of entry and exit does not cause competitive pressure on the major soft drink companies. It would be very difficult for a new company to enter this industry because they would not be able to compete with the established brand names, distribution channels, and high capital investment. Likewise, leaving this industry would be difficult with the significant loss of money from the fixed costs, binding contracts with distribution channels, and ments used to create the strong brand images. This industry is well established already, and it would be difficult for any company to enter or exit successfully. Three leading companies have prominent presence in the soft drink industry. The leaders include the Coca-Cola Company, PepsiCo, and Cadbury Schweppes. According to the Coca- Cola annual report (2004), it has the most soft drink sales with $22 billion. The Coca-Cola product line has several popular soft drinks including Coca-Cola, Diet Coke, Fanta, Barq’s, and Sprite, selling over 400 drink brands in about 200 nations (Murray 2006a). PepsiCo is the next top competitor with soft drink sales grossing $18 billion for the two beverage subsidiaries, PepsiCo Beverages North America and PepsiCo International (PepsiCo Inc., 2004). PepsiCo’s soft drink product line includes Pepsi, Mountain Dew, and Slice which make up more than one- quarter of its sales. Cadbury Schweppes had soft drink sales of $6 billion with a product line consisting of soft drinks such as A&W Root Beer, Canada Dry, and Dr. Pepper (Cadbury Schweppes, 2004). The carbonated beverage industry is a highly competitive global industry as illustrated in the financial statements. According to John Sicher of Beverage Digest (2005), Coca-Cola was the number one brand with around 4.5 billion cases sold in 2004. Pepsi followed with 3.2 billion cases, and Cadbury had 1.5 billion cases sold. However, the market share shows a different picture. Coca-Cola and PepsiCo control the market share with Coca-Cola holding 43.1% and Pepsi with 31.7% (see Graph 1); however these market shares for both Coca-Cola and PepsiCo

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have slightly decreased from 2003 to 2004. Coca-Cola’s volume has also decreased 1.0% since 2003, whereas PepsiCo’s volume has increased 0.4% (see Graph 1). Diet Coke posted a 5% growth, but Coca-Cola’s other top 10 brands declined (Sicher, 2005). Overall, Coca-Cola’s market position has declined in 2004. The strategic group map (see Graph 1) also shows the growth of Cott Corp. of 18% which is significantly higher than that of Coca-Cola and PepsiCo. The American Beverage Association (2006) states that in 2004, the retail sales for the entire softdrink industry were $65.9 billion. Barbara Murray (2006e) analyzed the industry averages for 2004 and average net profit margin was 11.29%. The current ratio average was 1.11 and the quick ratio average was 0.8. These figures help analyze the financial statements of the major corporations in the industry. As shown in Table 13, Coca-Cola has seen their net profit margin increase from 20.7% to 22.1% from 2003 to 2004. According to Coca-Cola’s annual report (2004), 80% of their sales are from soft drinks; therefore the total sales amount was used for their financial analysis. These figures show that their profits are increasing, but at a slow rate. This is in line with what is happening in the soft drink industry. The market is highly competitive and growth has remained at a stable level. The slight increase in Coca-Cola’s profit margin is most likely from their new energy drink product line. This industry is currently expanding rapidly, and is allowing the major beverage companies to increase their profits. Table 13 also shows CocaCola’s working capital was around $1.1 billion in 2004. This is a large increase from 2003 at only $500 million. This shows that they have sufficient funds to pursue new opportunities. However, their current ratio and quick ratio are a cause for concern. A current ratio of 2 or better is considered good and Coca-Cola’s was 1.102. This number shows that they may not have enough funds to cover short term claims. The quick ratio for 2004 was at 0.906 and is considered good when it is greater than 1. This illustrates that Coca-Cola may not have the ability to pay short term debt without selling inventory. These two numbers are a concern because they are not able to satisfy their short term obligations. The current and quick ratios are in line with the industry averages, however (Murray, 2006e), Coca-Cola needs to improve these ratios in order focus on long-term plans (Coca-Cola Company, 2004). PepsiCo’s financial statements cannot be analyzed for only the soft drinks industry because they do not distinguish between businesses. Over half their profits are from snacks or other beverage items; however there are sales and profit figures for their two beverage subsidiaries. These sales figures grew from almost $16.5 billion in 2003 to $18 billion in 2004 (Pepsi Co. Inc., 2004). Their operating profit margin also 14

increased 1% from 2003 to 2004 as illustrated in Table 13. This shows that beverage profits are increasing for them, but also at a slow rate. The increase could be due to the increase in market share that the Pepsi products gained in 2004 (Sicher 2004). The PepsiCo. Annual Report (2004) stated that beverage volume increased 3% in 2004, but was driven by the high growth of the noncarbonated beverage industry. Cadbury’s current and quick ratios are very similar to those of Coca-Cola. The current ratio and quick ratio for Cadbury Schweppes for 2004 were both 0.917 (see Table 13). Again, the current ratio should be 2 or more, and the quick ratio should be over 1. This illustrates that Cadbury also has difficulty paying short term debt and claims. Cadbury’s net profit margin has increased by 0.7% from 2003 to 2004. This can be attributed to their market share growth in 2004 of 0.2% (Sicher, 2005). One ratio that is concerning is their debt to equity ratio for 2004 in Table 13. They have almost two times as much debt as they do to equity, which means that their funds are mainly provided by creditors as opposed to owners. This is concerning because they owe a lot of money, and must make a decent profit to be able to pay it off. The industry average for debt to equity is 81%, and Cadbury is far from that number (2006e). Also, Cadbury has a negative working capital for both 2003 and 2004, meaning they have more liabilities than assets. This shows that they do not have any funds to pursue new opportunities, as their current assets are being used to pay off liabilities (Cadbury, 2004). Overall, the financial statements of the three top competitors in the soft drink industry show that the industry is highly competitive and has little growth. Net profit margins increased for all three corporations, however only at a small rate. It also seems that all three companies lack sufficient current and quick ratios, but are all within a reasonable range of the industry average (2006e). This may be due to expanding their product lines to include energy drinks and non-carbonated beverages in order to increase profits and diversify their business. The soft drinks market is now in the matured stage of the life cycle. Growth in the industry has remained stagnant, and the financial statements of the major corporations in the industry illustrate that their sales and income are following this trend. The companies are in good financial positions; gross profits and net profit margins are continuing to increase each year. The leverage and activity ratios are all within reasonable range. However, one area all three corporations need to improve on is the liquidity ratios. Their quick and current ratios are low and need to be increased so they are able to meet short-term obligations.

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Brand name loyalty is another competitive pressure.

The Brand Keys’ Customer Loyalty

Leaders Survey (2004) shows the brands with the greatest customer loyalty in all industries. Diet Pepsi ranked 17th and Diet Coke ranked 36th as having the most loyal customers to their brands. The new competition between rival sellers is to create new varieties of soft drinks, such as vanilla and cherry, in order to keep increasing sales and enticing new customers (Murray, 2006c). New entrants are not a strong competitive pressure for the soft drink industry. Coca-Cola and Pepsi Co dominate the industry with their strong brand name and great distribution channels. In addition, the soft-drink industry is fully saturated and growth is small. This makes it very difficult for new, unknown entrants to start competing against the existing firms. Another barrier to entry is the high fixed costs for warehouses, trucks, and labor, and economies of scale. New entrants cannot compete in price without economies of scale. These high capital requirements and market saturation make it extremely difficult for companies to enter the soft drink industry; therefore new entrants are not a strong competitive force (Murray, 2006c). Substitute products are those competitors that are not in the soft drink industry. Such substitutes for Coca-Cola products are bottled water, sports drinks, coffee, and tea. Bottled water and sports drinks are increasingly popular with the trend to be a more health conscious consumer.

There are

progressively more varieties in the water and sports drinks that appeal to different consumers’ tastes, but also appear healthier than soft drinks. In addition, coffee and tea are competitive substitutes because they provide caffeine. The consumers who purchase a lot of soft drinks may substitute coffee if they want to keep the caffeine and lose the sugar and carbonation. Specialty blend coffees are also becoming more popular with the increasing number of Starbucks stores that offer many different flavors to appeal to all consumer markets. It is also very cheap for consumers to switch to these substitutes making the threat of substitute products very strong (Datamonitor, 2005). Suppliers for the soft drink industry do not hold much competitive pressure. Suppliers to CocaCola are bottling equipment manufacturers and secondary packaging suppliers. Although CocaCola does not do any bottling, the company owns about 36% of Coca-Cola Enterprises which is the largest Coke bottler in the world (Murray, 2006a). Since Coca-Cola owns the majority of the bottler, that particular supplier does not hold much bargaining power. In of equipment 16

manufacturers, the suppliers are generally providing the same products.

The number of

equipment suppliers is not in short supply, so it is fairly easy for a company to switch suppliers. This takes away much of suppliers’ bargaining power. The buyers of the Coca-Cola and other soft drinks are mainly large grocers, discount stores, and restaurants. The soft drink companies distribute the beverages to these stores, for resale to the consumer. The bargaining power of the buyers is very evident and strong. Large grocers and discount stores buy large volumes of the soft drinks, allowing them to buy at lower prices. Restaurants have less bargaining power because they do not order a large volume. However, with the number of people are drinking less soft drinks, the bargaining power of buyers could start increasing due to decreasing buyer demand (Murray, 2006a). Porter’s Five Forces Model identifies the five forces of competition for any company. The recognition of the strength of these forces helps to see where Coca-Cola stands in the industry. Of the five forces, rivalry within the soft drink industry, especially from PepsiCo, is the greatest source of competition for Coca-Cola the soft drink industry is affected by macro environmental factors of the industry that will lead to change. First, the entry/exit of major firms is a trend in the industry that will likely lead to change.

More specifically, merger and

consolidation has been prevalent in the soft drinks market, causing some firms to exit the industry and then re-enter themselves. Several leading companies have been looking to drive revenue growth and improve market share through the increased economies of scale found through mergers and acquisitions. One specific example is how PepsiCo acquired Quaker Oats, who bought Gatorade which will help expand PepsiCo’s energy drink sector (Datamonitor, 2005). This trend has increased competition as firms’ diversification of products is increasing. A second trend in the macro environment is globalization. With the growing use of the internet and other electronic technologies, global communication is rapidly increasing.

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allowing firms to collaborate within the country market and expand into world markets. It has driven competition greatly as companies strive to be first-movers. Specifically, the global soft drink market’s compound annual growth rate (CAGR) is expected to expand to 3.6% from 2004 to 2009 (Datamonitor, 2005).

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Third, changing societal concerns, attitudes, and lifestyles are important trends. In the United States and Europe, people are becoming more concerned with a healthy lifestyle. “Consumer awareness of health problems arising from obesity and inactive lifestyles represent a serious risk to the carbonated drinks sector” (Datamonitor, 2005, p. 15). The trend is causing the industry’s business environment to change, as firms are differentiating their products in order to increase sales in a stagnant market. Thus, the long-term industry growth rate, the fourth trend, shows low growth in recent years. Since 2000, the CAGR is 1.5 per cent (Datamonitor, 2005). The low growth rates are of concern for soft drink companies, and several are creating new strategies to combat the low rates. This leads to the fifth trend of growing buyer preferences for differentiated products. Because soft drinks have been around since as early as 1798 (American Beverage Association, 2006), buyers want innovation with the products they buy. In today’s globalizing society, being plain is not good enough. According to Barbara Murray (2006c), “The key for all of these beverage companies is differentiation. The giants have new formulations and appearances. Whatever the strategy, be it a new color, flavor, or formula, companies will strive to create the greatest brand awareness in the minds of the consumer in the hopes of crowding out its competitors.” Thus, the last trend, product innovation, is necessary to combat buyers need for a variety of tastes. Firms are already differentiating by taste, with the Coca-Cola Company as an example. The firm’s product line includes regular Coca-Cola, Diet Coke, Diet cherry Coke, 11cherry Coke, Vanilla Coke, Coca-Cola with Lime, Coca-Cola with lemon and many more (Murray, 2006a). Key factors for competitive success within the soft drink industry branch from the trends of the macro environment. Primarily, constant product innovation is imperative. A company must be able to recognize consumer wants and needs, while maintaining the ability to adjust with the changing market. They must keep up with the changing trends (Murray, 2006c). Another key factor is the size of the organization, especially in of market share. Large distributors have the ability to negotiate with stadiums, universities and school systems. Making them the exclusive supplier for a specified period of time. Additionally, they have the ability to commit to mass purchases that significantly lower their costs. They must implement effective distribution channels to remain competitive. Taste of the product is also a key factor for success.

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Furthermore, established brand loyalty is a large aspect of the soft drink industry.

Many

consumers of carbonated beverages are extremely dedicated to a particular product, and rarely purchase other varieties. This stresses the importance of developing and maintaining a superior brand image. Price, however, is also a key factor because consumers without a strong brand preference will select the product with the most competitive price. Finally, global expansion is a vital factor in the success of a company within the soft drink industry. The United States has reached relative market saturation, requiring movement into the global industry to maintain growth (Datamonitor, 2005). Looking towards the future, the most important recommendation to Coca-Cola is continuing product innovation and expansion of their product line.

The soft-drinks industry is fully

saturated with competitors. Also, the industry is no longer expanding, and market share is actually decreasing as more consumers are looking to healthier options.

By continually

introducing new products, Coca-Cola will be able to increase their profits and allow the company to continue to grow. Also, having a diverse product line will make the corporation very stable, which is appealing to investors and creditors. A second recommendation would be to sustain or increase the global market share. Coca-Cola is very well-established globally, and is the global soft-drinks leader. This is very important to sustain because it is the source of the majority of their profits. If they lose global market share, their profits will decline dramatically. A final recommendation for Coca-Cola is to maintain and try to increase their brand loyalty. Diet Coke has the second highest brand loyalty of all the soft-drink competitors’ brands, and solid advertising campaigns will help maintain the brand loyalty. They can also strive to obtain higher brand loyalty in all other brands, not solely Diet Coke. The brand loyalty is important because it will allow Coca-Cola to sustain profits and maintain their market share. Energy drinks refer to beverages that contain, besides calories, caffeine in combination with other presumed

energy-enhancing ingredients

such as taurine, herbal extracts, and B

vitamins. They first appeared in Europe and Asia in the 1960s in response to consumer 19

demand for a dietary supplement that would result in increased energy (Reissig and others 2009). In 1962, a Japanese company, Taisho Pharmaceuticals, launched Lipovitan D, one of the very 1st energy drinks, which is still dominating the Japanese market. Lipovitan D contains

B vitamins,

taurine,

and

ginseng, which

are all frequent constituents

of

mainstream energy drinks with the intended purpose of providing the consumer with sustained energy, and to reduce mental and physical fatigue (Taisho Pharmaceutical Co. Ltd. 2009). Energy drinks did not make their way into the U.S. market until 1997 when Red Bull was first intro- duced, which originated and was initially launched 10 y earlier in Austria (Reissig and others 2009). Since the 1960s, the energy drink market has grown into a multibillion dollar business which has been reported as being the fastest growing segment in the beverage industry since bottled water (Agriculture and Agri- Food Canada 2008). Energy drinks have established a viable position in the beverage market as evidenced by their commonplace consumption in the morning, afternoon, and night, not only by the general consumer, but those of age 18 to 34 in particular (Lal 2007). Importance should be placed on consumer safety and the understanding on how these beverages a r e regulated. The ob- jective of this review is to give a general overview of the current energy drink market in regard to its size, target market, ingredient profile, potential benefits, safety, and regulations. Additionally, some nutraceutical beverages are found to be fortified with vitamins and minerals and contain sig- nificant levels of antioxidants, particularly polyphenols. In some instances, energy drinks could overlay into the nutraceutical bev- erage category depending on their ingredient composition. The energy drink segment encomes an array of options includ- ing ready-to-drink (RTD), shots, and in powder form. Globally, energy drinks hold 47.3% of the functional beverage’s overall market share, while in the United States they comprise 62.6% (Datamonitor

2008a,

2008b). Energy drinks in particular

have experienced impressive growth of more than 240% in the United States, as well as abroad, from 2004 to 2009 (Mintel 2009). In 2008, the functional beverage industry reached global sales of $26.9 billion with a compound annual growth rate (CAGR) of 8.6% from 2004–2008. The United States contributed significantly to the functional beverage industry’s total ing for $7.6 billion in revenue and a CAGR of 20.6%. In

20

addition, the U.S. energy drink industry is anticipated to more than double and reach an astounding

$19.7

billion in 2013,

which

is almost a 160%

increase

from

2008

(Datamonitor 2008a). Within the functional beverage category, the energy drink segment has experienced the largest volume growth and increased annual sales, both in the United States and abroad, reaching $4.8 billion in 2008 in the United States alone (Datamonitor 2008a). This is a higher market value than that reported in the same year for sports drinks ($2.0 billion) and nutraceutical drinks ($0.08 billion). This increased growth can be attributed to more private label initiatives, larger container sizes, multi-pack options, sugar-free versions, and juice hybrids that have a more palatable flavor (GMID 2008; Canadean 2009).

3. RESEARCH METHODOLOGY Research is the systematic process of collecting and analyzing information in order to increase our understanding of the phenomenon about we are concerned or interested Method of data collection: The primary data has been collected from the employees through survey. Tools used for analysis: Questionnaire has been used to collect the data from the employees. In this study, it is presented through tables. Data analysis made by using simple percentage method and karl pearson coefficient of correlation and weighted average. Research design Research design selected for this project is descriptive. Data collection method: 21

(a) Primary data collection method:  Survey method was used for primary data collection.  We used questionnaire as an instrument for survey method.  Structured questionnaire. (b) Secondary data collection method: 

Reference books and Internet.

Sampling detail 1. Target population:

the population for this research study consists of the soft drink s and retail outlets.

2. Sampling unit:in this study the sampling unit is individual consumer. 3. Sample size:

250 consumers 250 retailers.

4. Sampling method:

the sample is selected by using convenience-sampling method.

4. ANALYSIS AND INTERPRETATIONS 4.1 Percentage analysis for retailers Table 1: Opinion about first impression on Tropicana’s taste Options Unique taste Refreshing taste Perfect taste New taste Total

Frequency 39 72 76 63 250

Inference

22

Percent 15.6 28.8 30.4 25.2 100

The above table infers that 15.6% respondents impressed because of Tropicana’s unique taste, 28.8% respondents impressed due to refreshing taste, 30.4% respondents impressed due to perfect taste and 25.2% respondents impressed because of new taste. Table 2: Opinion about type of retailer business Options Fast food restaurants Super market or Hyper market Mini markets Wholesales Total

Frequency 25 88 79 58 250

Percent 10 35.2 31.6 23.2 100

Inference Table 2 shows that 10% respondents running fast food restaurants, 35.2% respondents runs supermarkets and hyper markets, 31.6% respondents runs mini markets like local retail shops and 23.2% respondents are wholesalers. Table 3: Availability of soft drinks Options Coke Thumps up Tropicana Sprite 7 UP Fanta Mirinda Pepsi Local products Total

Frequency 3 16 33 27 31 35 36 38 31 250

Percent 1.2 6.4 13.2 10.8 12.4 14 14.4 15.2 12.4 100

Inference Table 3 shows that 1.2% respondent says coke is available, 6.4% respondent says Thumps up is avail, 13.2% respondent says Tropicana is available. 13.2% respondent says sprite and 10.8% respondent say 7UP is available in their retail outlets. 14% respondent says Fanta and Mirinda is 23

available, 15.2% respondents says Pepsi and 12.4% respondent says other local products are available in the retail shops. Table 4: Availability of Cooled space Options Yes No Total

Frequency 139 111 250

Percent 55.6 44.4 100

Inference Table 4 shows that more than 55% respondents having cooled space (coolers) in their retail shops for displaying, 44% respondents don’t have any cooled space (coolers) for displaying sfot drinks in their retail shops. Table 5: Soft drink cooler provided by the company Options No Yes Total

Frequency 48 202 250

Percent 19.2 80.8 100

Inference Table 5 shows that 202 respondents are provided with soft drinks coolers and 48 respondents are not provided with any soft drink coolers.

Table 6: Cooking space brand 24

Options Coke Pepsi Both Total

Frequency 173 59 18 250

Percent 69.2 23.6 7.2 100

Inference Table 6 infers that 69% respondent are using coke’s cooler, 24% respondent are using Pepsi’s coolers and only 7% respondents using both coke’s and Pepsi’s coolers in their retail outlets. Table 7: Majority of the buyers (Gender wise classifications) Options Male Female Total

Frequency 137 113 250

Percent 54.8 45.2 100

Inference Table 7 shows that 55% male respondents are mainly using Tropicana drinks. 45% females are mainly using Tropicana drinks. It shows that males are majority of the Tropicana buyers.

Table 8: Majority of the buyers (Age wise classifications) Options Less than 15 years 16-20 years 21-25 years 26-30 years Total

Frequency 122 50 19 59 250

25

Percent 48.8 20 7.6 23.6 100

Inference Table 8 shows that 49% respondents who belongs to less than 15 years old are mainly using Tropicana, 20% of age group between 16-20 years of respondents using Tropicana, 24% respondents belongs to 26-30 years old are mainly using Tropicana soft drinks and only 21-25 years old respondents (8%) using Tropicana drinks. Table 9: Opinion about stock updates Options Every day Every Week Twice in a week Monthly once Total

Frequency 31 103 79 37 250

Percent 12.4 41.2 31.6 14.8 100

Inference Table 9 infers that 12% respondents updating their stock every day, 41% respondents updating their soft drinks stock every week, 32% respondents updating twice in a week and 15% respondents updating monthly once. Table 10: Opinion about most selling brands Options Mirinda Pepsi Tropicana Sprite Coke Fanta 7 UP Thumps up Local products Total

Frequency 12 36 28 30 43 35 26 25 15 250 26

Percent 4.8 14.4 11.2 12 17.2 14 10.4 10 6 100

Inference Table 10 infers that Pepsi, Fanta (14%) and Coke (17%) are the most selling brand, Tropicana (11%), Sprite (12%) ,7UP & Thumps up (10%) are the second most selling soft drinks and only 6% of the respondents feels Local products are most selling soft drinks brands. Table 11: Opinion about out of stock issues Options Once Twice Three times Many times Total

Frequency 26 78 95 51 250

Percent 10.4 31.2 38 20.4 100

Inference Table 11 shows that 10% respondents received out stock problem once in a month, 31% respondents received twice in a month, 38% respondents received out of stock problems for Tropicana three time in a month and 20% respondents received out of stock issues many time in a single month for the Tropicana products.

Table 12: Opinion about soft drink prices Options Yes No Total

Frequency 113 137 250

Inference

27

Percent 45.2 54.8 100

Table 12 shows that 45% respondents are received complaints about the soft drinks pricings and 55% of the respondents not received any complaints regarding soft drinks pricings from the consumers. 4.2 Weighted average Table 13: Descriptive statistics for brand shifting Factors Brand shifting because of taste and flavors Brand shifting because of pricing strategies Brand shifting because of availability Brand shifting because of discounts Brand shifting because of ments Brand shifting because of quality Brand shifting because of package attractiveness Brand shifting because of nutritional value

Mean 3.54 3.50 3.34 3.34 3.32 3.27 3.16 3.04

Std. Deviation 1.46 1.43 1.39 1.44 1.41 1.47 1.45 1.53

Inference Table 13 shows that soft drinks taste and flavors are the top ranked factor that affects the brand shifting with mean value of 3.54 and the stand deviations of 1.46. Pricing strategies of the soft drinks with the mean value 3.50 and the standard deviation is 1.43. Product availability and product discounts are the third main reason for brand shifting with the mean value of 3.34. Product ment, quality of the soft drinks is the next factors for brand shifting. Package

28

preference and nutritional value in the soft drinks are the last ranked factors for brand shifting with the mean value of 3.16 and 3.04. 4.3 Correlation analysis Table 14: Correlation between brand shifting factors H0: There is no relationship between brand shafting factors

Pricing strategies ments

Correlation Sig. (2-tailed) Correlation

1 1 *

.154

2 .154*

3 0.028

4 0.062

5 .148*

6 0.062

7 .216**

8 .141*

0.015 1

0.657 0.077

0.33 .134*

0.019 0.064

0.331 .141*

0.001 .220**

0.026 .194**

0.225 1

0.034 .167**

0.316 .185**

0.026 0.073

0 .141*

0.002 .193**

0.008 1

0.003 .211**

0.248 0.079

0.026 .229**

0.002 .248**

0.001 1

0.213 .145*

0 .205**

0 .190**

0.022 1

0.001 0.038

0.003 .130*

0.555 1

0.04 .207**

Sig. (2-tailed) Nutritional value Correlation

0.015 0.028

0.077

Sig. (2-tailed) Correlation

0.657 0.062

0.225 .134*

.167

Sig. (2-tailed) Correlation

0.33 .148*

0.034 0.064

0.008 .185**

.211

Sig. (2-tailed) Correlation

0.019 0.062

0.316 .141*

0.003 0.073

0.001 0.079

.145

Quality

Sig. (2-tailed) Correlation

0.331 .216**

0.026 .220**

0.248 .141*

0.213 .229**

0.022 .205**

0.038

Discounts

Sig. (2-tailed) Correlation

0.001 .141*

0 .194**

0.026 .193**

0 .248**

0.001 .190**

0.555 .130*

.207

0.001 1

Sig. (2-tailed) N

0.026 250

0.002 250

0.002 250

0 250

0.003 250

0.04 250

0.001 250

250

Availability Package attractiveness Taste and flavors

**

**

*

**

*. Correlation is significant at the 0.05 level (2-tailed). **. Correlation is significant at the 0.01 level (2-tailed). Inference Table 14 shows that all the brand shifting variables are positively correlated with other variables. Significance of brand shifting variables is less than 0.05 and less than 0.01 for remaining factors. 29

Null hypothesis is rejected. All the factors are strongly and positively correlated with other variables. 4.4 Reliability test Table 15: Reliability test Cronbach's Alpha

N of Items 0.579

8

Inference Table shows Cronbach's alpha is 0.579, which indicates a high level of internal consistency for scale with this specific sample. 4.5 Percentage analysis for consumers Table 16: Age wise classifications Options Less than 15 years 16-20 years 21-25 years 26-30 years More than 30 years Total

Frequency 33 52 11 76 78 250

Inference

30

Percent 13 21 4 30 31 100

Table 16 shows that 13% respondents are less than 15 years old, 21% respondents are 16-20 years old, only 4% respondents are 21-25 years old, 30% respondents are 26-30 years old and 31% of respondents are more than 30 years old. Table 17: Income wise classification Options Less than 20000 Rs 20001-30000 Rs 30001-40000 Rs More than 40000 Rs Total

Frequency 31 92 59 68 250

Percent 12 37 24 27 100

Inference Table 17 shows that 12% respondents are getting less than 20000 rupees, 37% respondents are getting 20001-30000 rupees, 24% respondents are getting 30001-40000 rupees and only 27% respondents getting more than 40000 rupees as a monthly salary. Table 18: Family member wise classification Options 1-3 4-6 More than 6 Total

Frequency 30 214 6 250

Inference

31

Percent 12 86 2 100

Table 18 shows that 12% respondents are having 1 to 3 in their family, 86% respondents are having 4 to 6 and only 2% respondents are having more than 6 in their family. Table 19: Occupation wise classification Options Students Private employee Government employee Business Total

Frequency 121 57 17 55 250

Percent 48 23 7 22 100

Inference Table 19 infers that 48% respondents are students, 23% respondents are private employees, 7% respondents are government employees and 22% respondents are business persons. Table 20: Favorite drinks Options Carbonated soft drinks Non carbonated soft drinks Non alcoholic beer Shanks Mineral water Sparkling water or Flavored water Total

Frequency 11 22 30 78 41 68

Percent 4 9 12 31 16 27

250

100

Inference Table 20 shows that 4% respondents are like carbonated drinks, 9% respondents like non carbonated drinks, 12% respondents like non alcoholic beer, 31% respondents like shanks and 16% respondents prefers mineral water and 27% respondents prefers sparkling water and flavored water. 32

Table 21: Favorite carbonate drink Options Mirinda Pepsi Tropicana Sprite 7 UP Fanta Coke Thumps up Local products Total

Frequency 9 17 17 36 30 37 39 33 32 250

Percent 4 7 7 14 12 15 16 13 13 100

Inference Table 21 shows that 4% respondents like Mirinda, 7% respondents like Pepsi and Tropicana drinks, 14% respondents like Sprite, 12% respondents like 7 UP and 15% respondents like Fanta. 16% respondents like Coke, 13% respondents like Thumps up and only 13% respondents like local products. Table 22: Alternative favorite soft drinks

33

Options Coke Pepsi Tropicana Sprite 7 UP Fanta Mirinda Thumps up Local products Total

Frequency 15 30 28 32 40 32 28 25 20 250

Percent 6 12 11 13 16 13 11 10 8 100

Inference Table 22 shows that 6% respondents like coke as alternative drink, 12% respondents like Pepsi as a alternative drink, 11% respondents like Tropicana as a alternative, 13% respondents like Sprite, 16% respondents like 7UP, 13% respondents like Fanta and 11% respondents like Mirinda as a alternative drink. 10% respondents like thumps up and only 8% respondents like local products as a alternative soft drink. Table 23: Type of drinks preferred Options Regular drinks Diet drinks

Frequency 33 94 34

Percent 13 38

sugar free drinks Fresh fruits drinks Total

73 50 250

29 20 100

Inference Table 23 shows that 13% respondents like regular drinks, 38% respondents prefers diet drinks, 29% respondents prefers sugar free drinks and 20% respondents like fresh fruit drinks. Table 24: Place of Purchase Options Fast food restaurants Super market or Hyper market Mini markets Local shops Total

Frequency 38 105 63 44 250

Percent 15 42 25 18 100

Inference Table 24 shows that 15% respondents purchasing soft drinks from fast food restaurants, 42% respondents purchasing soft drinks from super markets and hyper markets, 25% respondents mini markets and 18% respondents purchases from local retail shops. Table 25: Suggestions to the soft drink brands Options Discounts Broaden the target Change the packing design Change the flavor Change the color

Frequency 32 25 31 27 38 35

Percent 13 10 12 11 15

Change name Adding new distribution lines Potential outlets Total

30 30 37 250

12 12 15 100

Inference Table 25 infers that 13% respondents suggest to increase the product discounts, 10% respondents suggest to on concrete on broaden the target, 12% respondents suggest to change package design, 11% respondents suggest to change the flavors, 15% respondents suggest to change the color and taste of the drink, 12% respondents suggest to change the name and increasing the new distribution channels, 15% respondents suggest to increase the potential outlets.

5. FINDINGS •

Percentage analysis shows that 15.6% respondents impressed because of Tropicana’s unique taste, 28.8% respondents impressed due to refreshing taste, 30.4% respondents impressed due to perfect taste and 25.2% respondents impressed because of new taste. 10% respondents running fast food restaurants, 35.2% respondents runs supermarkets and hyper markets, 31.6% respondents runs mini markets like local retail shops and 23.2% respondents are wholesalers. 36

•

1.2% respondent says coke is available, 6.4% respondent says Thumps up is avail, 13.2% respondent says Tropicana is available. 13.2% respondent says sprite and 10.8% respondent say 7UP is available in their retail outlets. 14% respondent says Fanta and Mirinda is available, 15.2% respondents says Pepsi and 12.4% respondent says other local products are available in the retail shops.

•

55% respondents having cooled space (coolers) in their retail shops for displaying, 44% respondents don’t have any cooled space (coolers) for displaying sfot drinks in their retail shops.

•

202 respondents are provided with soft drinks coolers and 48 respondents are not provided with any soft drink coolers.

•

69% respondent are using coke’s cooler, 24% respondent are using Pepsi’s coolers and only 7% respondents using both coke’s and Pepsi’s coolers in their retail outlets.

•

55% male respondents are mainly using Tropicana drinks. 45% females are mainly using Tropicana drinks. It shows that males are majority of the Tropicana buyers.

•

49% respondents who belong to less than 15 years old are mainly using Tropicana, 20% of age group between 16-20 years of respondents using Tropicana, 24% respondents belongs to 26-30 years old are mainly using Tropicana soft drinks and only 21-25 years old respondents (8%) using Tropicana drinks.

•

12% respondents updating their stock every day, 41% respondents updating their soft drinks stock every week, 32% respondents updating twice in a week and 15% respondents updating monthly once.

•

Pepsi, Fanta (14%) and Coke (17%) are the most selling brand, Tropicana (11%), Sprite (12%) ,7UP & Thumps up (10%) are the second most selling soft drinks and only 6% of the respondents feels Local products are most selling soft drinks brands.

•

10% respondents received out stock problem once in a month, 31% respondents received twice in a month, 38% respondents received out of stock problems for Tropicana three

37

time in a month and 20% respondents received out of stock issues many time in a single month for the Tropicana products. •

45% respondents are received complaints about the soft drinks pricings and 55% of the respondents not received any complaints regarding soft drinks pricings from the consumers.

•

Soft drinks taste and flavors are the top ranked factor that affects the brand shifting with mean value of 3.54 and the stand deviations of 1.46. Pricing strategies of the soft drinks with the mean value 3.50 and the standard deviation is 1.43. Product availability and product discounts are the third main reason for brand shifting with the mean value of 3.34. Product ment, quality of the soft drinks is the next factors for brand shifting. Package preference and nutritional value in the soft drinks are the last ranked factors for brand shifting with the mean value of 3.16 and 3.04.

•

All the brand shifting variables are positively correlated with other variables. Significance of brand shifting variables is less than 0.05 and less than 0.01 for remaining factors. Null hypothesis is rejected. All the factors are strongly and positively correlated with other variables.

•

Reliability result shows Cronbach's alpha is 0.579, which indicates a high level of internal consistency for scale with this specific sample.

•

13% respondents are less than 15 years old, 21% respondents are 16-20 years old, only 4% respondents are 21-25 years old, 30% respondents are 26-30 years old and 31% of respondents are more than 30 years old.

•

12% respondents are getting less than 20000 rupees, 37% respondents are getting 2000130000 rupees, 24% respondents are getting 30001-40000 rupees and only 27% respondents getting more than 40000 rupees as a monthly salary.

•

12% respondents are having 1 to 3 in their family, 86% respondents are having 4 to 6 and only 2% respondents are having more than 6 in their family. 38

•

48% respondents are students, 23% respondents are private employees, 7% respondents are government employees and 22% respondents are business persons.

•

4% respondents are like carbonated drinks, 9% respondents like non carbonated drinks, 12% respondents like non alcoholic beer, 31% respondents like shanks and 16% respondents prefers mineral water and 27% respondents prefers sparkling water and flavored water.

•

4% respondents like Mirinda, 7% respondents like Pepsi and Tropicana drinks, 14% respondents like Sprite, 12% respondents like 7 UP and 15% respondents like Fanta. 16% respondents like Coke, 13% respondents like Thumps up and only 13% respondents like local products.

•

6% respondents like coke as alternative drink, 12% respondents like Pepsi as a alternative drink, 11% respondents like Tropicana as a alternative, 13% respondents like Sprite, 16% respondents like 7UP, 13% respondents like Fanta and 11% respondents like Mirinda as a alternative drink. 10% respondents like thumps up and only 8% respondents like local products as a alternative soft drink.

•

13% respondents like regular drinks, 38% respondents prefers diet drinks, 29% respondents prefers sugar free drinks and 20% respondents like fresh fruit drinks.

•

15% respondents purchasing soft drinks from fast food restaurants, 42% respondents purchasing soft drinks from super markets and hyper markets, 25% respondents mini markets and 18% respondents purchases from local retail shops.

•

13% respondents suggest to increase the product discounts, 10% respondents suggest to on concrete on broaden the target, 12% respondents suggest to change package design, 11% respondents suggest to change the flavors, 15% respondents suggest to change the color and taste of the drink, 12% respondents suggest to change the name and increasing the new distribution channels, 15% respondents suggest to increase the potential outlets.

39

6. SUGGESTION •

The survey explicitly several that the company should provide some more schemes and incentives mainly in seasons to retailers if they achieve target.

•

The company should be improving poor claim statement.

•

Pouches, foreign particles were found in few bottles so proper quality control measures should be implemented as companies’ reputations are at stake.

•

Company should try to make monopolists fat dealers it necessary because them they will be forced to sale the Pepsi product even if the company isn’t providing any further discount scheme.

•

Today in the situation of day-by-day competitions. Pepsi should because widely awake and alert to maintain its present market share and should devise fresh situation and program to enhance its sales.

•

That time many companies are entering the soft drink segment so company should are more attraction on display schemes no of holding should be increased and more change should be provide as Pepsi ahead of Pepsi in providing these above in Chennai.

•

School students, collages, canteens, cinema hall should be targeted.

•

Taste of Tropicana should be improved.

•

In promotions of sales of Tropicana the company should provides different schemes with the Tropicana like(collection of crown and get attractive prize or t-shirts or cap.etc)

•

ment must be improved and should show more appeal and targeted to youth and children.

•

A Company creates favorable impression among the youth if they sponsors small events like collages festivals, university programs & school functions.

40

•

The company should also organize some fashion shows; quiz programs etc promote their sales.

•

The company should ensure the timely product supply to the distributor and the retailers it was seen that staff in general & flavor in particular remains in short during the seasons.

•

Better schemes & benefit should be providing to retailers because it is retailers only who promote the product of company.

•

To argument the sale of Tropicana’s the company must provide some attractive free gifts & schemes.

•

Quality of pet bottle should be improved so that most problems can be minimized.

•

Soft drink is still considered a treat virtually a luxury so it possible company should cut down its price especially of cans.

41

7. CONCLUSION Service aspect of agencies is very effective, they deliver their product according to the demand a just in time. After conducting the field market survey of retailer in Chennai city, I analyze that other soft drinks like coca cola brands are dominating over Pepsi. The analysis several that minimum discount or schemes are available on coke compare to Pepsi. Consumers do have a demand for 200ml, 300ml bottle and 2 liter. Retailers have problem in ment material. Retailers have complaint regarding the plastic bottle that better quality pet bottle should be used. Consumers are satisfied with the quality of coca-cola products. The market share of Tropicana has good market in Chennai. Pepsi found to have good market coverage in Chennai. Retailers have a demand of some extra quantity and free gifts. Most of the consumers considered RGB bottles as the best package. Tropicana product is highly demanded by consumers. Only 25% of the consumers retain with the brand. Of course Pepsi ment is more preferable by consumers. ment is not a very major factor in consumption of the soft drinks. Chilled bottles influence the consumer to change the preference, so it’s a major factor. Taste and availability of stock is the major factor.

42

8. APPENDIX Retailer questionnaire 1. What is your first impression about Tropicana taste? a. Unique taste b. Refreshing taste c. Perfect taste d. New taste 2. What type of business are you in? a. Eateries (Fast food restaurants) b. Modern Trade (supermarkets, hypermarkets) c. Traditional Trade (Mini markets) d. Wholesales 3. What type of soft drinks do you sell? a. Coke

43

b. Pepsi c. Tropicana d. Stream e. Sprite f. 7 UP g. Fanta h. Mirinda i. Other, Please specify 4. Do you have cold space (coolers) available in your store? a. Yes b. No 5. If yes, are these soft drink coolers provided by the company? a. Yes b. No 6. If yes, which companies are providing coolers? a. Pepsi b. Coke c. Others, Please specify 7. The majority of buyers are from which gender? a. Males 44

b. Females 8. The majority of buyers are from which age group? a. Younger than 15 b. 16-20 c. 20-25 d. 26-30 e. More than 30 9. When do you usually get your stocks? a. Every day b. Every weeks c. Every month d. Twice in a week 10. What is the most selling brand from the bellow? a. Coke b. Pepsi c. Tropicana d. Stream e. Sprite f. 7 UP g. Fanta

45

h. Mirinda i. Other, Please specify 11. In length period of a month how many times do you get “Out Of Stock” issue? a. Once b. Twice c. Three times d. More 12. Do you ever get complains about the prices of a soft drink? a. Yes b. No 13. Many customers have shifted from PepsiCo products to other B-brands after the new pricing strategy. a.

Strongly agree

b.

Agree

c.

Neither agree nor disagree

d.

Disagree

e.

Strongly disagree

14. Many customers have shifted from PepsiCo products to other B-brands after the new ment strategy. a.

Strongly agree

b.

Agree

46

c.

Neither agree nor disagree

d.

Disagree

e.

Strongly disagree

15. Many customers have shifted from PepsiCo products to other B-brands due to changes in nutritional values. a.

Strongly agree

b.

Agree

c.

Neither agree nor disagree

d.

Disagree

e.

Strongly disagree

16. Many customers have shifted from PepsiCo products to other B-brands due to availability a.

Strongly agree

b.

Agree

c.

Neither agree nor disagree

d.

Disagree

e.

Strongly disagree

17. Many customers have shifted from PepsiCo products to other B-brands due to package preference a.

Strongly agree

b.

Agree

c.

Neither agree nor disagree

d.

Disagree 47

e.

Strongly disagree

18. Many customers have shifted from PepsiCo products to other B-brands due to taste and flavors a.

Strongly agree

b.

Agree

c.

Neither agree nor disagree

d.

Disagree

e.

Strongly disagree

19. Many customers have shifted from PepsiCo products to other B-brands due to quality of the drinks a.

Strongly agree

b.

Agree

c.

Neither agree nor disagree

d.

Disagree

e.

Strongly disagree

Consumer questionnaire 1.

What is your gender? a. Female b. Male

2.

In what age group are you? a. Younger than 15

48

b. 16-20 c. 20-25 d. 26-30 e. More than 30 3.

What is your current salary: a. Below 20000 Rs b. Between 20000-30000 c. Between 30001-40000 d. 40000 and above

4.

How many are in your family? a. 1-3 b. 4-6 c. 7-9 d. 10 and above

5.

What is your occupation? a. Student b. Businessman c. Employed by a local company d. Employed by a multinational company

6.

Which type is your favorite drink?

49

a. Carbonated Soft Drinks b. Non-carbonated Soft Drinks c. Non-alcoholic beer d. Shakes e. Mineral waters f. Sparkling water or Flavored water 7.

If you choose carbonated soft drinks, which brand is your favorite? a. Coke b. Pepsi c. Tropicana d. Stream e. Sprite f. 7 UP g. Fanta h. Mirinda i. Other, Please specify

8.

What is the alternate brand if your favorite drink is not available? a. Coke b. Pepsi c. Tropicana d. Stream 50

e. Sprite f. 7 UP g. Fanta h. Mirinda i. Other, Please specify 9.

Which kind do you prefer? a. Regular drink b. Diet Drink c. Sugar Free drink d. Fresh fruit drinks

10. Where do you usually purchase your drink from? a. Eateries (Fast food restaurants) b. Modern Trade (supermarkets, hypermarkets) c. Traditional Trade (Mini markets) d. Wholesales 11. What other improvements do you suggest for the brand? a. Incentives (discounts) b. Broaden the target market c. Change the design of bottle d. Change the formula, flavor

51

e. Change the color f. Change the name g. Add a New distribution lines h. Potential outlets (Hotels ,colleges, schools)

9. BIBLIOGRAPHY •

American Beverage Association (2005). Soft Drink Facts. Retrieved February 21, 2006 from http://www.ameribev.org/variety/facts.asp

•

Cadbury Schweppes. (2004). 2004 Annual Report. Retrieved February 17, 2006 from http://www.cadburyschweppes.com

•

Datamonitor. (2005, May). Global Soft Drinks: Industry Profile. New York. Reference Code: 0199-0802.

•

Hein, Kenneth. (2004). Brand Loyalty 2004. Retrieved February 12, 2006 from http://www.brandkeys.com/news/press/102504Brandweek.Loyalty.pdf

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