INTERNATIONAL MARKETING STRATEGIES
According to and (2006), the most successful global businesses are aggressively building their global strategies around these themes: (1) increased market access because of the opening up of markets in China, Central and Eastern Europe; (2) increased market opportunities because of the deregulation of many markets, such as the financial market and privatisation of state-owed utilities; (3) greater uniformity pf industry standards, encouraged, for example, by the European Union; (4) sourcing of products and components initially, but more recently services, too, from a wider range of countries, particularly those emerging markets with a high ratio of skills to cost; (5) more globally standardised products and services, particularly in areas of new technology, but increasingly in more culturally sensitive product areas, such as food; (6) common technology used in many more markets, particularly in areas of information technology, when there is a high cost of research and development that must be recovered through sales in many countries; (7) similar customer requirements leading to transnational customer segments, resulting from increased communication and travel; (8) competition from the same organisations in each major market and thus interdependence of markets; (9) global organisation strategies that increasingly treat the world as one market, among several other themes.
Marketing is a universal activity that is widely applicable, regardless of the political, social and economic systems of a country. However does it nor mean that consumers in all parts of the world must or should be satisfied in exactly the same way ( & ).
PEPSICO
PepsiCo Inc. is a major producer of carbonated soft drinks, other beverages, and snack foods. Its beverage division, Pepsi-Cola Company, bottles and markets several popular brands of soft drinks in the United States and throughout the world. PepsiCo also owns Frito-Lay Company, the leading snack-food maker in the United States. PepsiCo is based in Purchase, New York. PepsiCo’s soft drink products include Pepsi, Diet Pepsi, and Mountain Dew. Other beverages include Lipton Brisk and Lipton’s Brew iced teas, All Sport athletic drink, and Aquafina bottled water. Frito-Lay products include Lay’s and Ruffles Potato Chips, Fritos and Doritos Corn Chips, Chee-tos Cheese Snacks, Tostitos Tortilla Chips, Rold Gold Pretzels, and Grandma’s Cookies ( & 2001).
PepsiCo’s leading soft drink, Pepsi-Cola, and its chief rival, Coke, have dominated the soft-drink market for decades, although Pepsi has traditionally remained behind Coke. In 1950 Coke outsold Pepsi by 500 percent worldwide. But Pepsi’s aggressive advertising campaigns aimed at young consumers and major bottling and marketing deals made Pepsi a close rival to Coke by the 1980s. PepsiCo has also enjoyed great success with its canned and bottled Lipton brand iced teas, earning higher sales than the Coca-Cola Company’s Nestea products. Also, in the United States, Pepsi had virtually an even market share with Coke in the mid-1980s, when the Coca-Cola Company changed the formula for Coke. However, as Coke regained popularity worldwide in the late 1980s and into the 1990s, it again became the global soft-drink leader. In 1996 Pepsi-Cola International, PepsiCo’s international beverage production and marketing division, suffered difficulties in Latin America, one of its most important markets. The company was particularly hurt by the loss of a bottling plant to the Coca-Cola Company in Venezuela ( & 2001).
Market Entry
Just three decades ago, the competitive environment of the carbonated soft drink (CSD) industry was based on a recognition of and implicit acquiescence to the dominance of The Coca-Cola Company. Beginning in the 1960s, however, Coca-Cola’s dominance has been increasingly challenged, particularly by Pepsi-Cola. The new competitive environment is well publicised and intense. The Cola Wars were declared and the battle continues. Pepsi-Cola and Coca-Cola are widely recognised as being two of the premier marketing companies in the world. A great variety of new products and package types have been introduced. Celebrity advertising has been raised to a new level. Coca-Cola even changed the formula for Coke. These and other developments in the CSD industry came about from major changes in strategy by Pepsi-Cola and Coca-Cola. To some extent these strategic changes arose from Pepsi’s challenge to Coke’s dominance of the industry. In addition, several factors external and internal to the industry have been important catalysts for these changes. Rather than simply reacting to a changing competitive environment, PepsiCo and The Coca-Cola Company have created and implemented strategies that turned the new environment to their advantage (, & 1993).
Part of a marketing strategy is the utilisation of the marketing mix. The marketing mix principles is controllable variable that is why it can be adjusted on a frequent basis to meet the changing needs of the target market and other dynamics of marketing environment (, 2004).
Marketing Mix of PEPSI CO. TO HOST COUNTRIES (4Ps)
Product
As previously discussed, the main product of the PepsiCo are softdrinks and beverages which was distributed worldwide. These products will be available for the customers anywhere to host countries (i.e. China, India and Europe). Through Diversification, PepsiCo is able to cover all food and beverage alternatives. Its beverages alone are not limited to carbonated drinks but also, ready to drink teas, orange and fruit juices, mineral water and through the recent acquisition of Quaker Oats, isotonic drinks. Once, it had only catered to salty snack foods, but today, it also caters to sweet snack foods through ready to eat popcorn and healthy alternatives through Quaker Oats. This provides a wide variation of choices for consumers who may opt for a tasty food or healthy food lifestyle. PepsiCo also began acquiring quick fast-food restaurants and services such as Pizza Hut, Kentucky Fried Chicken and Taco Bell (all of which remain dominant in each respective market). These restaurants were also used as a means to capture customers into drinking PepsiCo’s beverages. At the same time, PepsiCo continues to acquire products such as 7UP, Lipton, Aquafina and Mug, and restaurants such as California Pizza Kitchen, East Side Mario’s, and Chevys Mexican Restaurants. Celebrities such as Michael Jackson, Ray Charles, Billy Crystal, Shaquille O’Neal, Andre Agassi and Madonna appeared in their many advertising campaigns, boosting sales.
Pricing
Similar to their local strategy, the advantage of the company is when it comes to its pricing tactic. In order to be known into the market place, the company provides its target market with an affordable cost while providing them a high quality products and services. The company gives the customer and client a price that is enough and matches the quality of their products.
Placement/Distribution
To be known internationally, one of the strategies that the product utilises is on a joint venture with distinguished distributor of beverages and food services. The company also utilises the so-called e-marketing to be known globally.
Promotion/Communication
To promote the company and its product, the company uses video advertisements, print advertisements and the concept of e-marketing. These promotion and communication strategy will tend to meet the consumers form different places everywhere, especially those target markets or the consumers in the working place.
From the capabilities of PepsiCo, they should launch a new commercial that focuses on the new “PEPSI FOOD GOOD: I LOVE IT EVEN MORE!” theme. It should show visuals and verbal encouragement in making the customer knew the quality of the Pepsi products for them to love it even more. The trick here is that the commercial should look like it favours the new features of Pepsi products more than the products of the competitors. In addition, Pepsi products must also employ its traditional advertisement strategy which includes famous celebrities and athletes to be involved in the commercial like the Pepsi commercial with no less than Beyonce Knowles to endorse Pepsi products (. 1996).
Although, these promotional tools that is use to promote the Pepsi brands can be considered as one of the strength of the company, the marketing department is still aware that they must used other promotional or communication tools to sustain their competitive position. In addition, the market nowadays has been greatly influenced by the modern technology such as the internet (, & 1993).
Forces of Globalisation of Markets
The several macro factors, which affect the global market and the business organisations are important to assess and examine for they can largely determine the success of the business organisation in the market. Pepsi Co must be able to have skills in developing new products and innovating new technologies to cope with the changes happening in the society today. Along with developing new products, Pepsi Co must also produce effective marketing strategies to provide solutions to the challenges that they face. In addition, it will also be necessary to anticipate problems and plan, in case a specific problem comes their way. This would help the company prepare and come up with alternative solutions for easy implementation of plans.
PESTLE ANALYSIS
Just three decades ago, the competitive environment of the carbonated soft drink (CSD) industry was based on a recognition of and implicit acquiescence to the dominance of The Coca-Cola Company. Beginning in the 1960s, however, Coca-Cola’s dominance has been increasingly challenged, particularly by Pepsi-Cola. The new competitive environment is well publicised and intense. The Cola Wars were declared and the battle continues. Pepsi-Cola and Coca-Cola are widely recognised as being two of the premier marketing companies in the world. A great variety of new products and package types have been introduced. Celebrity advertising has been raised to a new level. Coca-Cola even changed the formula for Coke. These and other developments in the CSD industry came about from major changes in strategy by Pepsi-Cola and Coca-Cola. To some extent these strategic changes arose from Pepsi’s challenge to Coke’s dominance of the industry. In addition, several factors external and internal to the industry have been important catalysts for these changes. Rather than simply reacting to a changing competitive environment, PepsiCo and The Coca-Cola Company have created and implemented strategies that turned the new environment to their advantage (, & 1993).
Although Pepsi Cola attacked Coca-Cola’s dominance and achieved near parity with Coke in bottled soft drinks, both Coke and Pepsi have benefited from fighting the Cola Wars because the battle between them has stimulated continuing growth in an industry regularly pronounced by the experts for many years to be on the verge of maturity (, & 1993). As the industry existed in the early 1970s, the reasons for predictions of impending maturity were not difficult to see. The apparent limits of the human stomach argued strongly against further significant growth of per capita consumption of soft drinks. New strategies, such as joining the parade of product modifications and introductions of other food manufacturers, and bringing what had long been a very effective independent distribution system in-house, required basic major modifications of the competitive advantages of Pepsi-Cola and Coca-Cola (, & 1993). The result of these and other new strategies has been a continued, rapid expansion of Pepsi’s and Coke’s domestic sales. The limits of the human stomach have not yet been found, and all other liquids, from coffee to water, face continued competitive pressure from Pepsi and Coke (, & 1993).
IMPACT OF GLOBALISATION TO INTERNATIONAL MARKETING STRATEGY OF PEPSI CO.
Globalisation plays significant role and effect to International Businesses. Pepsi has company extensive promise to milieu in providing secure and vigorous environment for the employees and for the community. Actually, Pepsi is devoted to scheming, creating, upholding and operating amenities that guard the people in terms of physical resources. As part of globalisation changes and international approach of the company, Pepsi is committed in reducing the crashing of business in environment through protection and recycle ways and use of energy programs in promoting dirt free air also water and decrease landfill squander as stated in universal system of conduct as based on subsequent environmental philosophy such as the following:
Ø The business industry is mannered by fulfilling the appropriate laws and system and provide secure and vigorous milieu
Ø minimise the collision of Pepsi business on situation through techniques that are publicly accountable and systematically base and efficiently thud like for example materials recycle ways and maintenance
Ø mounting program that encourage dirt free air as well as water and power conservation and the decrease of land wastes
Ø through sustaining programs that inform and educate as well as motivate Pepsi employees to help preserve good atmosphere
Ø By assisting together with diverse business organisation in finding answers for diminishing pollution problems and the back-up process applied to ecological policies
Pepsi is able to offer service required by the customers and the employees are motivated to optimise input and obtain practice in diverse areas of operation like for instance, if Pepsi decided to surmount the international market so there can be options the company will come across and it is important that the management of Pepsi should choose marketing strategy that is suitable for their products and services being offered for the Pepsi company to be more competitive as there can be stabilisation of political as well as economic power as there is the providing of needed environment encouraging to marketing activities as well as overseas investments. Likewise, culture is imperative feature in understanding Pepsi’s market status as the company operate effectively for universal position as to how business culture will pressure Pepsi’s market efficiency for their success and or failure. Furthermore, in terms of promoting the Pepsi’s services and products, Pepsi Company can use certain media advertisements like TV or print and be open to concepts of e-marketing as Pepsi’s strategy will be inclined to assemble consumer preferences of the services being offered and products provided.
The marketing plan and strategies for Pepsi is not complete without having attention and consideration to valued and loyal customers as customers will play a crucial factor of marketing planning agenda of the Pepsi company in addressing reasonable sanctions for productivity and development as well as customer preservation as Pepsi company can utilise in gaining critical market strategy advantage over its competitors for the survival of growing spirited environment (, 1999). Pepsi should evidently recognise the targeted element and stakeholders as to which marketing strategy should be directed ( and , 2002).
CONCLUSION
A competitive market system creates incentives for firms to vie for large market shares. Sometimes one firm is so successful in this fight, it acquires a dominant position in a market. From the firm’s point of view, a large market share is good. After all, dominance implies power and control. It creates a real potential to increase profits. From society’s point of view, however, dominance may not be quite so desirable. For the power that goes with dominance can be acquired and used in a number of ways. While some of these ways may promote economic welfare, others might reduce it. If the reductions are large and long-lived, people may want to reconsider whether dominance should be affirmed in all cases ( 1998).The company is expanding its markets on countries it has not yet completely conquered like some parts of Asia. Some parts of Asia is currently controlled by coca cola their rival company. Pepsi Co is continuously doing the best it can to match or exceed their competitors reach. The company is using everything available to reach more markets and outdo their rival. By having different markets more options can be used by the company. PepsiCo’s leading soft drink, Pepsi-Cola, and its chief rival, Coke, have dominated the soft-drink market for decades, although Pepsi has traditionally remained behind Coke. But Pepsi’s aggressive advertising campaigns aimed at young consumers and major bottling and marketing deals made Pepsi a close rival to Coke by the 1980s. The company is continuously reaching places it has not reached before. It is conducting expansions to reach new territories and increase its profitability and clients. The company uses new branches and subsidiaries in different countries to have more territories and reach more people more. These branches have been oriented and trained regarding company policies and procedures. It also uses different expansion techniques so that no problem occurs.
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