Pepsi Company: SWOT analysis
The company uses such methods that it focuses only on its sale and the competition level. Pepsi Company tries to locate places where the demand of the beverages of Pepsi Company can be created. The company focuses on the sale of its products through different types of publicity and advertisements. 2. Cost of the products: The cost of one product is much minimized therefore the company manages to sell its products on a cheaper rate and still enjoy profit. 3. Market of Pepsi Products:
Pepsi Company is a well established company and has market grounds all over the world therefore the changes or the amendments made in the price do not really affects the sales. The demand of the product tries to remain consistent. 4. Faster Turnaround: The Pepsi Company bears a faster turn around compared to the other companies. The company has the facilities of better satisfaction and other qualities which help the product consumption to grow and expand. Weaknesses (internal): 1. Declining markets:
Pepsi Company has faced the phase of declining markets so the company does its best to implement it from the hard times and stay steady with the demand and the sales. The harsh weather and many other
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The company has done no frauds and that is why the reputation level of Pepsi Company is higher in the eyes of customers. Opportunities (external): 1. Expansion in the rural areas: The Pepsi Company has the target to achieve the grounds of market in the rural areas. To achieve this target many people are sent to these areas for convincing the people of the rural areas to the purchase the products of Pepsi Company, and they are using different types of opportunities to expand their plant. The Pepsi Company is trying to avail all the opportunities to stand a market in the rural areas.
2. New regulations implemented: The new themes can be approached to fill in the demand and this will create renovation in the appearance of the product which will help in the attraction of the customers. The attractive model, color, shape will help in attracting more consumers and this opportunity will be very big thing for the Pepsi Company. Threats (external): 1. Tough Competition: The increased level of competition has increased the value of the products. Every company deals more with the packaging and advertising for attracting customers to them.
The market has become rash and all the people are in the need of satisfaction but by utilizing less and receiving more. The level of competition has made the Pepsi Company to launch different kinds of beverages in order to maintain its place in the market. III. What current strategy are they using? The current strategy used by the company is reaping more profits through large number of sales. The company launches several new products each year and then tries to conquer the grounds of the market by capturing on the demands of the people.
The Pepsi Company tries to focus on marketing its products through celebrity endorsements and mega marketing campaigns. The strategy behind the scenes is to overcome its competitors on marketing battles rather than the product itself. Promotion activities and endorsements occupy most of the budget of the company and little is spent in innovation and product quality improvement. The company is financially doing well. The company has the net revenue of about $35 million of the years 2006-2007.
In these year some implementations were done which includes Frito-lay salty snacks, Tropicana, Lipton Brisk, Aquafina, Rice-A-Roni and many more food and beverages were introduced in the years 2007. In the year 2006 75% of the sales of international oats resulted $500 million. The financial statements say that the company has some losses but the can be overcome as soon as possible by some amendments. The company of Pepsi is very well established and has introduced several products in the pace of many years and restrained its position also. IV. What Strategy would you recommend?
A strategy is one of the most important set of actions that companies must agree upon preferably at the start of an important business period. For companies like Pepsi, it is worth mentioning that the existing strategy is not ineffective, but there is room for improvement. Though the focus may be more on advertisements and marketing the product, it is necessary to consider the other aspects that could be worth using in order to improve sales and eventually brand equity. I would recommend that Pepsi should focus its attention from the marketing paradigm to cut-throat competition in terms of product quality.
Die-hard drinkers of Coke and Pepsi realize the difference in taste between the two products however much the difference. However, a large section of the consumers do not really distinguish between the products. The key is to target this segment and to lure consumers of other beverages (juices, soda, etc) to drink Pepsi more. The strategy that I would recommend is to position the product Pepsi in such a way that it attracts all segments of beverage drinkers – though Pepsi cannot be marketed as a health drink, it can be successfully be marketed as a sportsman’s drink.
Using more sports celebrities to endorse the products would be an ideal strategy and spending more on sports events would result in Pepsi products being more popular amongst the beverage drinkers in the long run. I would also recommend experimentation with newer flavors and time and effort spent in research and development so that Pepsi can introduce newer drinks into the market. Just like the Pulpy Orange was brought into the market by Coca Cola, Pepsi should get its R&D team to produce innovative drinks to keep one step ahead of its competitor – who is waiting and watching every move Pepsi makes.
V. Would you like to work for the Company? Considering the socio-economic factors that currently prevail in the industry and the magnanimous growth that companies like Pepsi have been achieving, I would definitely like to work in Pepsi Company. In the light of the above analysis in terms of Porter’s Five Forces and SWOT, I have come to the conclusion that it is more exciting and challenging to work in Pepsi than any other large multinational in a different sector.
I, particularly being interested in challenging and exciting tasks, find Pepsi Company the best workplace for myself – particularly due to the various threats that it faces being avoidable through innovation and strategic moves. I would love to work in Pepsi because it will involve a competitive analysis at a multinational level and would enable me to gain the experience of tacit decision making in an environment as dynamic as its product.