ASSIGNMENT 2 FRONT SHEET

Qualification BTEC Level 4 HND Diploma in Business

Unit number and title Unit 2. Marketing Essentials

Submission date 18 September 2021 Date Received 1st submission

Re-submission Date Date Received 2nd submission

Student names & codes Final scores Signatures

1. Bui Thi Le Giang GTD201495

2. Nguyen Hoang Nhat GCD191042

Group number:
3. Tran Huynh Thao Nguyen GBD201749

4. Nguyen Thi Thanh Chau GBD201736

5. Nguyen Tang Quoc Bao GBD201903

Class GBD0905 Assessor name Tran Xuan Quynh

Student declaration
I certify that the assignment submission is entirely my own work and I fully understand the consequences of plagiarism. I understand that making a
false declaration is a form of malpractice.

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P3 P4 M3 M4 D2

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 OBSERVATION RECORD
Student 1 Bui Thi Le Giang

Description of activity undertaken

1. Executive Summary
2. Core competitor’s Marketing Mix
3. Conclusion

Assessment & grading criteria

How the activity meets the requirements of the criteria

Student
Giang Date:
signature:

Assessor
Date:
signature:

Assessor
name:

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 Student 2 Nguyen Hoang Nhat

Description of activity undertaken

1. Marketing Environment and the impact on Business Activities

2. Marketplace Information
3. Customer Analysis

Assessment & grading criteria

How the activity meets the requirements of the criteria

Student
Nhat Date:
signature:

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Date:
signature:

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name:

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 Student 3 Tran Huynh Thao Nguyen

Description of activity undertaken

1. Company’s internal capabilities

2. Marketing Campaign Issues
3. Segmentation, targeting, positioning

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How the activity meets the requirements of the criteria

Student
Nguyen Date:
signature:

Assessor
Date:
signature:

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 Student 4 Nguyen Thi Thanh Chau

Description of activity undertaken

1. Marketing Campaign Objectives

2. Budget
3. Control

Assessment & grading criteria

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Student
Chau Date:
signature:

Assessor
Date:
signature:

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 Student 5 Nguyen Tang Quoc Bao

Description of activity undertaken

1. Differentiation strategies of your company

2. Marketing mix
3. Action Program

Assessment & grading criteria

How the activity meets the requirements of the criteria

Student
Bao Date:
signature:

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Date:
signature:

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 Summative Feedback:  Resubmission Feedback:

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 Table of Contents
Introduction................................................................................................ 11
Situation Analysis ...................................................................................... 11
I. Marketing Environment and the impact on Business Activities .................. 11
1. Micro Environment................................................................................................................. 11
a. The Company .................................................................................................................... 11
b. Suppliers ............................................................................................................................ 13
c. Marketing Intermediaries.................................................................................................... 14
d. Competitors ....................................................................................................................... 14
e. Publics ............................................................................................................................... 15
f. Customer ........................................................................................................................... 15
2. Macro-environment................................................................................................................ 15
a. Demographic environment ................................................................................................. 15
b. Economic Environment ...................................................................................................... 16
c. Natural Environment .......................................................................................................... 16
d. Technological Environment ................................................................................................ 17
e. Political Environment ......................................................................................................... 17
f. Cultural Environment ......................................................................................................... 17

II. Marketplace Information ............................................................................ 18

1. Industry ................................................................................................................................. 18
2. Market Trend ......................................................................................................................... 18

III. Core competitor’s Marketing Mix ............................................................... 19

IV. Customer Analysis ..................................................................................... 23
V. Company’s internal capabilities ................................................................. 23
1. The threat of the entry of new entrants .................................................................................. 24
2. The rivalry between the existing players ................................................................................ 24
3. The threat of substitutes ........................................................................................................ 25
4. Bargaining power of suppliers ............................................................................................... 26
5. Bargaining power of buyers ................................................................................................... 26

Marketing campaign objectives and issues ................................................ 27

I. Objectives.................................................................................................. 27
II. Issues ........................................................................................................ 28
Marketing strategy new marketing mix of Pepsico ..................................... 28

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I. Marketing strategy ..................................................................................... 28
1. Segmentation..................................................................................................................... 28
2. Targeting ........................................................................................................................... 30
3. Positioning ......................................................................................................................... 30
4. Strategies of PepsiCo ........................................................................................................ 31

II. Marketing Mix of PepsiCo .......................................................................... 33

1. PepsiCo’s Products............................................................................................................ 34
2. PepsiCo’s Prices ................................................................................................................ 34
3. PepsiCo’s Place ................................................................................................................. 35
4. PepsiCo’s Promotion ......................................................................................................... 35
5. PepsiCo’s People............................................................................................................... 36
6. PepsiCo’ Process............................................................................................................... 37
7. PepsiCo’s Physical Evidence ............................................................................................. 37

Action Program .......................................................................................... 38

Control ....................................................................................................... 40
Conclusion................................................................................................. 42
References ................................................................................................ 43

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 Introduction

Suntory PepsiCo Vietnam Beverage (SPVB), which was officially established in April 2013.
The purpose and vision of the company are to continue to strengthen and retain a leadership
position in the beverage sector while adhering to the principles of firm. The company produces
and trades in many items such as canned coffee, energy drink, tea, carbonated soft drinks, bottled
water, fruit juice. My team is in charge of marketing for the carbonated soft drink product, which
is Pepsi bottled soft drink and the target market of the product is the customer market. In this
article, we will cover research on marketing tactics to compete with multiple competitors. The
following report covers the elements of the marketing mix (7ps) along with a basic marketing plan.

Figure 1 Trademark of Pepsico

Situation Analysis

I. Marketing Environment and the impact on Business

Activities
1. Micro Environment
Definition: Micro Environment, refers to the environment comprising of all the actors of an
organization’s immediate environment which influences the performance of the company, as they
have a direct bearing on the firm’s regular business operations.

a. The Company
Top management
Top management are the top managers of the business, responsible for operating and
distributing the general activities of the enterprise, responsible for the short-term, strategy, main

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operating organizations of the business and responsible for responsible for the end result of the
business.

Ramon Laguarta is the Chairman of the Board of Directors and Chief Executive Officer of
PepsiCo. As part of this drive to build a Better company, Ramon has pushed PepsiCo to embrace
a bold purpose—helping to build a more sustainable food system—with a focus on becoming
PepsiCo Positive by delivering better outcomes for people and the planet. As part of this agenda,
Ramon has spearheaded PepsiCo’s ambitious steps to mitigate the impacts of climate change
and the visionary Beyond the Bottle strategy, which aims to offer consumers a range of great-
tasting beverages, while making the company’s packaging more sustainable and fueling future
growth. This strategy includes the acquisition of SodaStream, the world's leader in at-home
sparkling beverage preparation, and complements the company’s sustainable packaging vision,
including efforts to develop fully recyclable or compostable packaging materials.

Under Ramon’s leadership, the company is also adopting new leadership behaviors that are
focused on driving high performance and building competitive advantage. These behaviors
include: be consumer-centric; act as owners; focus and get things done fast; voice opinions
fearlessly, raise the bar on talent and diversity; celebrate success; and act with integrity.

Finance
Finance: It is a system of economic relations arising in the course of production and business
activities

In the company Pepsico finance will help the public to create capital, rotate capital to ensure
that the operating capital of the business is always sufficient and stable, to meet the needs of
production and business in a timely manner; Redistribute income to rebalance capital properly,
know how to use profit most effectively, thereby promoting production and business activities of
enterprises.

R&D
Research and development (R&D) includes activities that companies undertake to innovate
and introduce new products and services. It is often the first stage in the development process.
The goal is typically to take new products and services to market and add to the company's bottom
line.

In 2020, PepsiCo spent just over 719 million U.S. dollars on research and development. Over
the past seven years, the company’s total R&D expenses have fluctuated between 665 and 760
million U.S. dollars

Purchasing
Purchasing is about finding the best quality equipment, goods and services for a company or
organization and purchasing them at the most competitive prices.

Pepsico's Sustainable Sourcing Program (SSP) builds supplier awareness and capacity on the
issues and expectations addressed in the Supplier Code of Conduct (SCoC). The program
supports long-term sustainable supply goals by addressing known risks and building capacity in
supply operations. Pepsico's approach is informed by their regular engagement and leadership
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positions with industry groups such as AIM-PROGRESS, Sedex and the Consumer Goods Forum,
as well as through engagement with industry groups. professional NGOs, such as Shift, to leverage
best practices from across the industry and beyond. Internally, the SSP strategy is reviewed
annually in consultation with leaders from our human rights, sustainable agriculture, procurement
and legal groups to support business integration.

The SSP includes Pepsico's SCoC compliance and risk assessment as well as third-party
audits of business-critical direct suppliers, contract manufacturing and co-packer sites. In 2019,
Pepsico expanded its SSP to additional segments of our supply chain to include third-party labor
suppliers and franchisors in select markets, for a total of 92 countries are included in the program.
We will continue to expand this risk-based approach to other geographies and segments of our
supply chain in the future as part of our commitment to promoting respect for human rights
throughout the chain. our broader values.

Operations
This department is responsible for planning and implementing activities related to the
production and business of the enterprise.

PepsiCo's operations management is accomplished through market-based research and

development and product innovation. For example, PepsiCo conducts market research on current
trends, such as consumer lifestyles. The results of this study are used to determine the future
direction of PepsiCo products, such as future variants of Pepsi

Accounting
Accounting is too a parse type, write copy, totalists of the current object of the business, to
provide information about the financial position of the business to the information users

The accounting information helps Pepsico's managers assess the competitiveness of the
business in the market. From there, Pepsico businesses will come up with appropriate business
strategies to improve the quality of products and services to help expand market share, increase
revenue and profit.

b. Suppliers
Supplier is a concept that refers to an organization/individual that provides a product or service
to another organization, possibly another.

A transaction of buying and selling goods or any product / service is made by two or more
entities, including Supplier and buyer. Application providers will provide products / services, buyers
will spend money to buy back these items with commensurate value.

PepsiCo is committed to purchasing from a representative supplier base consisting of

employees, consumers, retail customers, and the community. Developing partnerships with
diverse suppliers helps Pepsico build the world-class supplier base it needs to succeed by forging
mutually beneficial relationships that expand its reach by PepsiCo. Pepsico approach helps build
community infrastructure by providing jobs and training while creating role models and driving
purchases from other diversely owned businesses.

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 In 2019, Pepsico spent approximately US$1.4 billion with diverse US suppliers1. This includes
Tier 2 spending reported by non-diversified suppliers, which demonstrates PepsiCo's commitment
to expanding the involvement of diverse suppliers in the supply chain. Beginning in 2017, Pepsico
expanded its supplier diversity program to include LGBT, Veterans, and Disability-owned
businesses.

Since Pepsico started its Diversity of Suppliers program more than 35 years ago, Pepsico has
spent $26.4 billion on diversified suppliers. It is proud to say that Pepsico uses diverse suppliers
in most areas of their company.

c. Marketing Intermediaries.
Marketing Intermediaries are businesses that help your company to promote, sell, and
distribute your products and services to your customers. They can include resellers, physical
distribution firms, marketing service agencies, and financial intermediaries.

In Viet Nam PepsiCo Beverage Company manufactures and markets a wide range of soft
drinks, making it the second largest beverage company in the world. PepsiCO's branded products
are: Pepsi; Diet Pepsi (Diet Pepsi); Mountain fog; 7 pieces. Pepsi has established an emotional
bar for customers in the beverage industry through advertising, distribution and marketing to
expand operations. Pepsi's agent and distribution system is considered a big company of Pepsi
from 7968 gallons of soda in 1903 to nearly 5 billion VND in 1997 (PEPSI Beverage
DISTRIBUTION - NATIONWIDE DISTRIBUTION LIST, 2020)

Pepsi will adjust prices to reward customers who pay ahead of time, buying in bulk. Quantity
discounts are discounts given to customers who buy products in bulk. Product Type Discriminant
Pricing: Under this pricing model, Pepsi's product lines and items are priced differently, but in
proportion to their respective costs. (Pepsi Strategy Analysis, n.d.)

This helps Pepsico to expand its scale and reach customers through intermediaries. Therefore,
despite not having direct contact with users, Pepsico has built a wide distribution network.

d. Competitors
Competitors is competition between tricks operating in the same industry in the same market
area.

PepsiCo applies different generic competitive strategies, considering the company’s wide array
of products. However, the main generic strategies that contribute to PepsiCo’s competitive
advantage are as follows: Cost leadership and Broad differentiation.

PepsiCo uses cost leadership as its primary generic competitive strategy. This generic strategy
focuses on cost minimization as a way to improve PepsiCo’s financial performance and overall
competitiveness. For example, to compete against Coca-Cola products, PepsiCo offers low prices
based on low operating costs. The company also sometimes has special promotional offers with
discounted prices. On the other hand, PepsiCo uses broad differentiation as its secondary generic
competitive strategy. This generic strategy enables business competitive advantage by attracting
consumers to some unique features of the firm’s products. For example, PepsiCo’s Lay’s potato

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chips are marketed as a healthful snack product because of reduced saturated fat content. A
strategic objective for the cost leadership generic strategy is to automate production processes to
minimize PepsiCo’s operating costs. In relation, PepsiCo’s strategic objective for the broad
differentiation generic strategy is to innovate products to address concerns about their health
effects.

e. Publics
Publics is any group that has an actual or potential interest in or impact on a company’s ability
to achieve its objectives.” The environmentalists, consumer protection groups, media persons and
local people are some of the well-known examples of publics.

PepsiCo business is influenced by public policy at the local, state, national, regional and global
levels. Pepsico's Public Policy and Government Affairs team works with senior management to set
annual and long-term public policy priorities. Help create goodwill among the public, help get
favorable feedback for the company because their overall success will be influenced by how other
publics in society view their activities

f. Customer
Customer are individuals or organizations that the business is marketing efforts towards. They
are the decision makers to buy. Customers are the objects of the product-service quality system.

Pepsi’s target market is 18-35 year olds . Pepsi’s new outreach through unconventional forms
of marketing, like social media, is an effort to strengthen the brand loyalty of the youth target
market. There is no definitive preference between males vs. female target markets. Pepsi
embraces both.

But nonetheless, men (52.6%) prefer Pepsi over women (47.4%) (Simmons OneView, 2014).
After the age of 35, preference for Pepsi tends to decrease. But 18-35 is the most robust, according
to the data (Simmons OneView, 2014). From 18-24 years old, we see that 25.9% drink Pepsi and
42.3% say they drink Coke. From 25-34 year olds, 21.5% say they drink Pepsi, and 20.9% say
they drink Coke.

Theses statistics explain why Pepsi is appealing to younger audiences because the figures
are larger for 18-24 year olds in comparison to 25-34 year olds.

2. Macro-environment
a. Demographic environment
Demographic environment refers to the human population characteristics that surround a firm
or nation and greatly affect markets. The demographic environment includes such factors as age
distributions, births, deaths, immigration, marital status, sex, education, religious affiliations and
geographic dispersion — characteristics often used for segmentation purposes

Age: Pepsico potential customers will be between the ages of 15-30 so they will mainly focus
on the younger generation

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 Education: The company has to plain promotional strategies to attract the customers. If the
targeted customer's majority population is educated in a country the through advertisements
PepsiCo can be made well aware of their product and can convey their message easily

Population distribution: Pepsico targets urban areas and middle to upper class as people there
are more attractive to such deprived wards while people in rural areas are more attracted to more
natural drinks

Population density: Pepsico sales their product more in those cities and regions, which have
the largest population density

b. Economic Environment
Economic Environment is a many element files has the width of the image and follow the other
direction to the business of each business.

PepsiCo has opportunities for growth and expansion based on the economic stability of
developed countries like the United States, as well as the high growth rates of developing
economies, such as those in Asia. However, the current slowdown of the Chinese economy
threatens PepsiCo’s potential international growth, considering that China is among the biggest
economies in the world. This element shows that PepsiCo must ensure market diversification to
achieve stable international growth.

c. Natural Environment
This includes the natural resources that a company uses as inputs that affect its marketing
activities. The concern in this area is the increased pollution, shortages of raw materials and
increased governmental intervention.

PepsiCo recently shared its progress in a new sustainability report. In this document, it outlines
the priority areas it believes could have the “most meaningful impact” and the work completed to
date (PepsiCo makes strides towards sustainability targets, 2020). These areas include:

• Agriculture
• Water
• Climate
• Packaging
• Products
• Everyone.

The company's sustainable plastics vision is based on three interconnected strategies:

reducing the amount of plastic it uses, recycling more plastic, and reinventing the plastic packaging
it uses.

Last year, PepsiCo made its plastic bottles lighter, and trialed a process called ‘charge
compaction’ which causes snacks to settle to the bottom of the bag during packaging. Through
this, PepsiCo said it has been able to reduce the amount of packaging used.

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 It is also working to increase the amount of recycled PET it uses in plastics bottles, with a goal
of 50 percent recycled PET inclusion in bottles across the EU by 2030. In 2019, the company
made progress toward reinventing how its products are delivered to consumers through the
expansion of its Soda Stream business. Its new Pepsi by Soda Stream flavors will launch in select
European markets through 2020.

d. Technological Environment
Technological forces form a crucial influence in the Macro Environment. They relate to factors
that create new technologies and thereby create new products and market opportunities or threats.
... Otherwise, the products or services will soon be outdated, and the company will miss new
product and market opportunities.

PepsiCo’s business is partly dependent on technologies. The technological external factors

significant to PepsiCo are as follows:

• Moderate R&D investments in the food and beverage industry

• Improving knowledge management systems
• Increasing automation in business

Based on moderate research and development (R&D) investments in the industry, PepsiCo
can boost its own R&D investments to improve its competency in this business aspect. Also,
PepsiCo can exploit the benefits of knowledge management systems to support its various
business processes, such as product innovation and strategic decision-making. In addition, an
increase in the number of automated processes in the company can enhance business
performance.

e. Political Environment
Political factors in the macro-environment include taxation, tariffs, trade agreements, labor
regulations, and environmental regulations.

Major economies like the United States and Canada are politically stable, thereby presenting
growth opportunities for PepsiCo. In addition, the trend of intergovernmental cooperation improves
opportunities for global expansion. However, government initiatives against sweetened
carbonated drinks are a threat that could reduce PepsiCo’s revenues from affected segments.

f. Cultural Environment
The Socio-Cultural forces link to factors that affect society's basic values, preferences, and
behavior. The basis for these factors is formed by the fact that people are part of a society and
cultural group that shape their beliefs and values

Many of PepsiCo’s consumers follow sociocultural trends. The following are notable
sociocultural external factors relevant to PepsiCo’s business:

• Higher health consciousness (threat & opportunity)

• Increasing busy lifestyles (opportunity)
• More discriminating attitudes about product quality (opportunity)

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 Greater health consciousness is a threat to PepsiCo because of concerns about its products'
sugar, salt, and fat content. However, this external factor also provides an opportunity for the
company to improve its product to address those concerns. PepsiCo can also take advantage of
consumers' hectic lifestyles, especially in urbanized and industrialized markets around the world.
People with this lifestyle are more likely to buy instant food products like PepsiCo's. The company
has the opportunity to continue to improve product quality to maximize revenue, given consumers'
increasingly discriminatory attitudes about product quality. Based on these elements of the
analysis PepsiCo must adjust its products and marketing strategies to accommodate changes in
consumer behavior.

II. Marketplace Information

1. Industry
PepsiCo has a steady portfolio of more than 100 different brands. The company dominates the
snack, food, and beverage industries. While brands are part of the food industry, no other company
offers as much versatility as PepsiCo. Customers can get a little bit of everything. And that led to
PepsiCo's ease of satisfying consumer demand. By diversifying we can see Pepsico products
everywhere and because PepsiCo owns some of the most popular food, beverage and snack
brands, PepsiCo has transformed into a single brand. globally recognizable. Each brand is worth
millions to billions of dollars. And they are under PepsiCo, pushing the company's net worth into
the billions of dollars.

2. Market Trend
The strategy of Pepsi to develop more products aside from soda, like sports drinks and fruit
beverages has somehow made the company evade the declining stage of the products and the
manufacturing firm itself. PepsiCo is now known not only for its Pepsi soda but also for other
products that are now considered as the brands with high level of consumers’ recognition.
Eventually, the market share of PepsiCo may go to a lower level due to constant penetration of
other competitors in the market.

However, because of its established name in the beverages industry, Pepsi still able to survive
the battle of numerous beverages brand in the market. In this aspect, the company still possesses
an edge among its competitors. Even though, thousands of brands are already in the market, the
society can never deny the fact that Pepsi was able to build a good foundation despite its intense
competition with the Coca Cola Company. In PepsiCo’s case, the company has been in a perfect
competition even before the other neophyte brands were developed.

The development of new products aside from soft drinks, repositioning the products that are
already existing, improving and changing of products’ packaging have given PepsiCo competitive
edges among other brands in beverages and foods industry. Basically, the company is often
affected by the constant changes in the marketplace. The market trend of PepsiCo has always
been giving a proof that the company is sometimes soaring high leaving its competitors on the
ground.

On the other hand, the company sometimes faces business conflicts due to the movements of
products and manufacturers in the marketplace. However, the marketing tactics of the company

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boosts up not only its market share but also its level of consumers’ recognition and loyalty.
Apparently, PepsiCo is still able to expand the business despite the existence of global competitors
in the market. In fact, the company is continuing to penetrate more market and distribute more
products to the consumers all over the world

III. Core competitor’s Marketing Mix

PepsiCo has its competitors such as Coca-Cola, Dr.Pepper, Snapple, Red Bull, Dabur Real
Juice, etc. Coca-Cola is the major competitor of PepsiCo.
Coca-Cola is also called Coke. It is also a carbonated soft drink. It is one of the non-alcoholic
beverage companies and a popular brand in the world. The company’s top five soft drinks brands
are Diet Coke, Coca-Cola, Sprite, and Fanta. Other than soft drinks, the company also markets
juice drinks, waters, sports and energy drinks. For example, Minute Maid, Dasani, Powerade, and
Vitaminwater are some of the other brands.

The objective of The Coca-Cola Company is 'to be the world's leading provider of branded
beverage solutions, to deliver consistent and profitable growth, and to have the highest quality
products and processes.
According to Forbes Magazine (2020) that Coca-Cola is valued at about $64.4 billion and it is
one of the most valuable companies in the world. It has a wide presence across the globe and
people who visit any country will find its presence there. The marketing strategy of Coca-Cola is
good and it targets people of all ages.

Figure 2 Coca-cola brand value, (Forbes magazine,2020)

To achieve such success, the marketers of this company have continuously innovated the
marketing mix strategy suitable for each different product line.

Product – Product strategy of Coca Cola

According to Nielson data, Coca-Cola was the number one brand in the soft drink, juice, and
bottled water market in 2010. From its flagship product of carbonated drinks, now Coca-Cola has
diversified products with many designs, colors and flavors such as Fanta, Maaza, Limca, sprite,
Thums Up, Minute Maid, Nimbu Fresh or Nested Iced Tea. These are all beverage brands of Coca-

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Cola in more than 200 countries and territories around the world. The company has constantly
researched and developed many new products such as Joy bottled water, Samurai energy drink,
Sunfill fruit powder, and added many new flavors to traditional products to meet the tastes and
preferences of customers. Vietnamese taste like Fanta Chanh, Fanta Strawberry. In 2016, Coca
launched a sugar-free Coke to compete directly with Pepsi, while responding to the increasing
trend of consumers to use low-sugar beverages to avoid obesity and sugar-related diseases.
serious.

Despite being present in the Vietnamese market for more than 20 years, Coca Cola is still on
the rise and shows no sign of decline in both revenue and profit.

Coca Cola's packaging is constantly improving to help prolong the product's life cycle in order
to give customers a new, eye-catching, optimistic and convenient feeling when using. During each
Tet holiday, Coca-Cola uses the image of a "swallow" to signal the arrival of spring to create a
good impression on consumers, helping to add value to the product, which is very suitable for gifts
and Tet gifts.

Figure 3 Life cycle of Coca-Cola products year by year with differentiation strategy
(Marketing AI,2020)

In general, in the product strategy, Coca-Cola has expanded the current product portfolio by
increasing the depth of a product line and increasing the number of product lines, positioning
products suitable for each specific market. especially the Asian and Vietnamese markets, and
Coca knows how to exploit the brand to be able to compete in the "giant" soft drink market.

Price – Coca Cola's pricing strategy

Thanks to the variety of products, Coca-Cola's selling price is adjusted accordingly to each
market segment and geography. Each Coca-Cola brand has a different pricing strategy. This Coca
cola marketing strategy is based on the competitor format of Coca Cola, in which Pepsi is the
biggest direct competitor of the Coke brand. The beverage market is quite monopolistic (the
number of sellers is very small), so the companies will enter into an agreement to create an
equilibrium in the selling price of the product.

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 Coca-Cola products set prices by looking at the buyer's perception of value, not the seller's
cost.

Pricing strategies in Coca Cola's marketing mix strategy:

Coca cola has pursued 3P and 3A pricing strategy to gain advantage and best serve coca
cola's target customers and consumers.

❖ 3P strategy:
• Price to value (from price to value): consumers not only have the ability to buy coca cola
but also get the benefits from the product.
• Pervasiveness: consumers can buy Coca-cola everywhere
• Preference: make consumers not only love the product, but also ensure that Coca is the
first choice when they look for soft drinks.
❖ Strategy 3A:
• Affordability: Coca Cola's selling price is guaranteed to be suitable for all audiences, anyone
can afford it.
• Availability: consumers must be able to buy Coca-Cola whenever and wherever
• Acceptability: Coca Cola must make customers love and accept the product, feel happy
when using the product.

In addition to setting relatively low prices to penetrate the market, Coca-Cola also sets prices
at a discount, adjusting prices to reward customers who pay ahead of time and buy products in
bulk. In addition, Coca-Cola also uses a strategy of price discrimination by product type.

Figure 4 Coca-Cola's marketing campaign with Coca-Cola's price adjustment strategy to

penetrate the market (Marketing AI,2020)
Place – Coca Cola's distribution strategy
Coca-Cola is the most loved brand and is available almost everywhere in the world. Coca-
Cola's distribution systems follow the distribution model of fast moving consumer goods (FMCG).
Coke's efficient distribution network has almost wiped out the small and medium-sized points of

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sale in the market. In India, Coca-Cola has "conquered" the rural market by distributing widely and
gradually losing market share to Bovonto, Kalimark,...

In Vietnam, Coca-Cola beverage products are produced at 3 bottling plants in Ho Chi Minh
City, Hanoi, and Da Nang. At the same time, Coca-Cola's distribution network is nationwide, from
big cities to rural areas, from general agents to small retail stores, present at retail locations across
the country, coffee shops, soft drinks or restaurants, eateries, etc. Coca-Cola attracts small
distribution points by providing financial support, decorating stores, giving umbrellas, etc.

Promotion – Coca cola's communication strategy

Communication is the most special strategy in the marketing mix strategy of Coca Cola.
Through diverse advertising campaigns, Coca-Cola has created a demand in the market by
combining lifestyle with daily behavior. Therefore, you can easily come across an advertisement
of Coca-Cola for individuals on special occasions or when Coca-Cola wants to convey a good
message to the whole society. Coca-Cola uses its social responsibility (CSR) as an advertising
tool, hitting customers' feelings and thoughts. For example, Coca-Cola's "Support my school"
campaign in cooperation with NDTV - a major TV channel in India, with many famous Indian brand
ambassadors such as Shahrukh khan, Hrithik Roshan, Southern actors India Vijay, Trisha,
Ghambir, Aamir khan... Thanks to the campaign, Coca-Cola products have been discounted more
than usual in this country along with some other privileges on distribution and promotion.

Understanding the psychology of consumers, Coca-Cola does not forget that promotion is one
of the best tools to promote the image of the product. The use of promotions not only helps the
company's sales increase, but it also demonstrates the value that the company brings to its
customers.

Figure 5 Coca Cola's marketing strategy through marketing and advertising (Coca-
cola,2020)

22
➢ This strategy shows that Coca-Cola is a formidable competitor to all other companies, and
Pepsico is no exception. Therefore, the marketing department needs to build reasonable and
tight marketing mix strategies to beat the competition.

IV. Customer Analysis

Customer segmentation is the practice of dividing a company's customers into groups that
reflect similarity among customers in each group. The goal of segmenting customers is to decide
how to relate to customers in each segment in order to maximize the value of each customer to
the business

PepsiCo segmentation, targeting and positioning decisions can be specified as the essence of
overall marketing efforts. Segmentation involves dividing population into groups according to
certain characteristics, whereas targeting implies choosing specific groups identified as a result of
segmentation to sell products. Positioning refers to the selection of the marketing mix the most
suitable for the target customer segment.

PepsiCo uses multi-segment type of positioning and accordingly, it targets more than one
customer segment at the same time with different products or service packages. For example,
Pepsi-Cola is positioned as soft drink that tastes good and has a pleasantly refreshing impact.
However, Pepsi-Cola contains a high amount of sugar and it is not positioned for customers that
are concerned about health implications of consuming carbonated soft drinks. For this specific
customer segment PepsiCo offers Diet Pepsi, which is positioned as a soft carbonated drink that
contains less among of sugar compared to Pepsi-Cola and other soft drinks.

V. Company’s internal capabilities

Figure 6 Porter’s Five Forces Model

23
 1. The threat of the entry of new entrants
PepsiCo is also considered a leader in the beverage industry, with the finance only to pay
for advertising the company's beverage products. That is enough to prove the company's
growth when it spent about $224 million advertising Pepsi and approximately $253 million on
2 other famous products of the PepsiCo brand - Gatorade and Mountain Dew in 2019.
Besides, Coca-Cola and PepsiCo beverage companies control about 70% of the soft drink
market in the US (Statista Research Department, 2021).

Figure 7 Advertising spend of selected beverage brands in the U.S, 2019

Following that, it is said that new entrants can only learn from the history of the first
entrants, they lack first-hand experience. Therefore, compared to the PepsiCo business,
which has been in the market for almost 65 years, a long enough time to have enough
experience in handling the crises the company faces, something new entrants cannot keep
up with.

It may be stated that a small company directly challenging PepsiCo is an unlikely thing.
Because it only occupies a negligible market and does not have a significant impact on
PepsiCo. On the other hand, a mid-range company can compete, but it takes time to establish
a position and pose a challenge to the PepsiCo behemoth.

➔ Overall, having some barriers for new competitors. Also, PepsiCo faces a moderate
challenge from new entrants.

2. The rivalry between the existing players

Based on CARBONATED BEVERAGES MARKET Pepper (Mordor Intelligence
Corporation, 2020), the carbonated beverage market is saturated. About more than 100
beverage companies are operating in the US market, not counting other mid-sized or small
companies. Therefore, can be said that PepsiCo has numerous rivals of varying sizes, and
the market in the US will be able to keep expanding in the future.

However, Coca-Cola and PepsiCo nearly completely dominate this industry. It is well
recognized as a Duopoly with Coke and Pepsi battling. These two firms control the majority

24
 of the market, while the remaining players have a relatively small market share. Namely, in
2020, Coca-Cola was ranked with a volume share of 44.9%. Ranked second, PepsiCo
garnered a volume share of 25.9% (Jan Conway, 2021). This makes PepsiCo difficult to gain
ground and becoming the market leader.

Although PepsiCo prides itself on its Pepsi carbonated soft drink, it is often compared
to Coke in terms of price and taste, it is easily replaced by that if PepsiCo has no product
differentiation. its products. Competitors like Nestlé, Dr.Pepper are more likely to steal
customers from PepsiCo with their unique products. Typically, in 2020, Nestlé's revenue
surpassed both Coca-Cola and PepsiCo to reach $90,321 million (macrotrends, 2021).

➔ Overall, the rivalry between the existing players is strong, PepsiCo should concentrate
on differentiating its goods so that the activities of rivals have less of an impact on its
customers who seek out its distinctive items.

3. The threat of substitutes

According to statistics from Bach Hoa Xanh's sales website, this is a gradual pricing
rivalry among beverage businesses. Compare a few beverage products from different
brands, generally, the price is not much different, affordable to buy. That is to the detriment
of every company, including PepsiCo, because customers can easily shift towards substitute
products without worrying about switching costs.

Figure 8 Summarize the prices of popular beverages

PepsiCo is a company specializing in the production of carbonated soft drinks - a product
that is not recommended by doctors often because it is harmful to health. That makes
PepsiCo difficult when customers switch to safe alternatives with their health such as filtered
water, tea, natural juice, so on. Not only that, PepsiCo's main competitor, Coca-Cola, also
has similar beverage products in terms of taste and price, even in a blind test, customers
cannot easily distinguish the flavor of Pepsi and Coke.

25
 Figure 9 The unbiased comparison of Coca-Cola and Pepsi
➔ Overall, the threat of substitutes is strong to PepsiCo. Because it is not very proprietary.
PepsiCo requires a unique and ground-breaking product that will be difficult to replace.

4. Bargaining power of suppliers

The majority of the desirable raw resources for manufacturing soft drinks are fundamental
goods such as taste, color, caffeine, sugar, and packaging, among other things. Because
raw materials for soft drinks are basic commodities that are easily available to every
producer, so PepsiCo has the right to choose the suppliers with the lowest costs. As a result,
the suppliers of these commodities have little negotiating leverage overpricing, and as a
result, the suppliers in the soft drink sector are relatively weak.

According to PepsiCo’s main web page (PepsiCo, n.d.), operating in over 200 countries,
PepsiCo also has thousands of self-owned suppliers. That means PepsiCo is a big customer
of the suppliers. Furthermore, the company's profits and benefits are closely tied to its
suppliers, making it dependent on PepsiCo and difficult to get out of. Moreover, by owning
its suppliers, PepsiCo retains the initiative in switching suppliers due to its wide choice. The
loss of a few suppliers did not affect PepsiCo too much.

➔ Overall, the bargaining power of suppliers is weakened to PepsiCo.

5. Bargaining power of buyers

The number of suppliers in the industry in which PepsiCo operates is a lot more than the
number of firms producing the products. This means that the buyers have a few firms to
choose from, and therefore, do not have much control over prices. Also, the product
differentiation within the industry is high, which means that the buyers are not able to find
alternative firms producing a particular product. This difficulty in switching makes the
bargaining power of buyers a weaker force within the industry.

Based on the examination of variables, there are four primary explanations. Firstly, the
company is multinational, individual customers buy PepsiCo goods in tiny quantities, thus the
company is not concentrated on any one market. Secondly, developing a large customer
base will reduce clients' bargaining power and allow the firm to streamline its manufacturing
and sales procedures. Third, the PepsiCo Company is constantly trying to offer new goods,

26
 which limits consumers' bargaining power. Lastly, because excellent products fulfill the
majority of buyers' demands, loyal PepsiCo customers are less likely to move to rivals.

➔ Overall, buyer negotiating power is weak in comparison to PepsiCo,

Marketing campaign objectives and issues

I. Objectives
With SMART framework, PepsiCo Vietnam can set up the objectives for the company’s
marketing campaign effectively:

- Increase revenue from 8.8% to 9.3% in 2022.

Specific
- Grow market share of PepsiCo Vietnam in Vietnam market to 48.5% at
the end of 2022.
- Expand brand awareness from North to South of Vietnam within 6
months.
- After each stage, the company will measure the success of the campaign
Measurable
through collect and analyze indicators for timely changes (if needed).
- The final results can be measured by statistics which is statistically and
analyzed in annual report of 2022.
- PepsiCo Vietnam had the popularity and it has strong budget for marketing
Attainable
campaign (878,070,000,000 VND), it can achieve these objectives which it set.
The marketing campaign is divided into 3 main stages:
1/ January 2022 to March 2022: Product advertising.
2/ April 2022 to June 2022: Sales and promotions.
3/ July 2022 to December 2022: Maintain popularity.
- All goals aim to PepsiCo Vietnam’s overall goal: gain many profits, develop
Relevant
the corporation in a sustainable way, and be the global leader in the foods and
beverages industry (PepsiCo, 2021).
- All objectives will be implemented within 1 year. Each stage has different
Time-bound
time period:
+ Stage 1: 3 months.
+ Stage 2: 3 months.
+ Stage 3: 6 months.

Table 1: PepsiCo Vietnam's marketing campaign objectives follow SMART framework

27
 By following SMART goals, PepsiCo Vietnam easy to carry out and achieve its business
objectives quickly and successfully.

II. Issues

Based on the data in the article (Cheng, 2020), in one of the latest signs of the economic impact
of the coronavirus, soft drink giant PepsiCo PEP+ 0.1% reported a 15% drop in second-quarter
2020 profit, as it was hit by federal spending. related to the pandemic an additional 400 million
USD. Because the fact that consumers rarely go out and many places where they traditionally
consume soda such as convenience stores, vending machines, restaurants, fast food stores, so
on have closed or closed for food service. drink at the store.

To solve this problem, PepsiCo can offer the following solutions. Firstly, to keep costs in check,
PepsiCo can reduce non-essential advertising and marketing, also focus on better-performing
items, part of a growing industrywide trend. Secondly, affected by the pandemic, most people are
staying at home and ordering online, the company can set up an online sales website, allowing
shoppers to order directly its products. Finally, health-promoting products during the epidemic
season are of great interest, the company can promote the advertising of Tropicana juice products
and Naked smoothies, and other nutritious snacks.

Marketing strategy new marketing mix of Pepsico

I. Marketing strategy

1. Segmentation

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 Type of Segmentation criteria PepsiCo target segment
segmentation
- Domestic/ international
Region - In Vietnam: cities and 64 provinces
- Urban/ rural area
Geographic - The climate of Vietnam is so dry and
hot; its target is in which consumers
Density
need to have something to reduce their
thirst.

Age Teens and young adults.

Gender Males & Female

Demographic Average, above average and high

Income earners

Occupation Students, employees, professionals

- Refreshment
- Enjoying the good taste
Benefits sought - The satisfaction of a habit

Behavioral
Personality Easygoing/determined/ambitious

User status Regular users

Lifestyle Aspirer, Succeeded, Explorer

Psychographic
The working class, middle class, and
Social class upper class

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 2. Targeting

Based on statistics on reputable websites ( DESTINY JACKSON, 2017), PepsiCo's main target
for its Pepsi product range is individuals aged 18 to 35. It also targets athletes and those who are
overweight. PepsiCo's marketing campaigns have a particular way of depicting time.

Following that, PepsiCo produces products that deal with various cultural and regional features
of a specific country. For example, it sells goods like Nimbooz by 7UP in India, where there is a high
demand for country-style lemon beverages (Mitra, 2015). Manzanita Sol, an apple-flavored
beverage, is available in Mexico. Because apple is the second most popular soft drink flavor in
Mexico (Jaramillo, 2016).

3. Positioning

In the case of PepsiCo, the business wishes to position itself as the beverage of choice for the
"New Generation" and "Generation Next" ( DESTINY JACKSON, 2017). Billions of dollars are spent
aiming to inspire the youthful and about youthful with the diverse innovative slogan annually.
PepsiCo Company is planning to further make positions that will give items the best point of interest
in their target market

For instance, Pepsi’s current “Live for Now” slogan that PepsiCo company applies for this
product is a prime campaign of how PepsiCo positions the brand. The slogan is a clever strategy
to anchor the perception that drinking Pepsi embraces a robust, fulfilled, and adventurous lifestyle.
Pepsi's advertising efforts target a youthful demographic that is energetic, creative, and has high
aspirations in life. They live for the moment and are unconcerned with long-term goals.
Furthermore, the Pepsi logo is deep blue, which represents youth and openness. PepsiCo should
utilize two techniques to develop effective positioning strategies: product attribute and product user.

30
 Figure 10 The campaign "Live For Now"

4. Strategies of PepsiCo

Product type differentiated pricing strategy:

One of PepsiCo's smartest strategies was to implement differentiated pricing by product type.
Because to meet the increasingly diverse needs of consumers as well as improve competitiveness,
Pepsi has constantly researched and provided different products to the Vietnamese market.
Corresponding to each product line are the accompanying levels. However, they still ensure the
ratio with the corresponding cost. According to (ceo360.vn - Cộng Đồng CEO Việt Nam, 2021) :

• Pepsi carbonated soft drink 390ml bottle selling price 5,400 VND/bottle.
• Low-calorie soft drink Pepsi Light without sugar, can of 330ml, price of 8,400 VND/can.
• Pepsi Cola 1.5liter soft drink: 14,600 VND/bottle.
• Bottle of soft drink 24 cans/barrel: 140,000 VND/barrel.

Figure 11 Product type differentiated pricing (ceo360.vn - Cộng Đồng CEO Việt Nam, 2021)

“Better with Pepsi” campaign - Virtual restaurant experience:

Not stopping at choosing a representative model, the brand continues to launch experiences
aimed at the public's emotions and vision. The Better with Pepsi campaign promotes the new
product portfolio through the virtual restaurant Pep's Place. The restaurant can be found on the
PepsiPlaceRestaurant.com website and on food ordering apps like DoorDash and GrubHub. This
is the first time that food and beverage delivery has been offered by the brand at the same time.

31
 Figure 12 Better with Pepsi campaign kicks off with Pep's Place virtual restaurant
(Pepsi khởi động chiến dịch chuyển động số “Better with Pepsi”, 2021)

Pep's Place also claims to create a new experience "first drink". Instead of customers ordering
food first and choosing drinks later, with this virtual restaurant model, customers will experience
"reverse" service. Only after choosing your favorite drink will the available dishes be displayed to
suggest a suitable meal. This means that Pep's Place will bring a new experience by making drinks
a priority, instead of making food the main course. This is truly a unique promotional message.

Figure 13 The “reverse” experience: Order Pepsi first and food later
(Pepsi khởi động chiến dịch chuyển động số “Better with Pepsi”, 2021)

32
 "Bring Tet home" campaign:

Currently, as digital technology is constantly evolving, Pepsi's marketing strategy has shifted
towards digital marketing and advertising. Since social media went mainstream, the company has
started connecting with millions of people around the world on this platform. Advertising campaigns
are carried out in real time, which has helped to connect with the public faster. For example, the
campaign about family affection "Bring Tet home" (Dua Tet Ve Nha) has been widely spread. This
is typical of the company's rapid transformation and strategy to capitalize on the "magic power" of
images and emotions. Since then, the brand is mentioned by more people, creating loyalty with
customers and building loyalty in the long run.

According to (BringTetHome, 2021) , more than 1,000 air tickets, 2,000 round-trip car tickets
and other meaningful gifts will be given to more than 3,000 students, workers, and workers who
are working away from home in difficult circumstances, poor, unable to return to their hometown
to celebrate Tet with their family.

Figure 14 “Pepsi brings home Tet” – Impressive advertising campaign ends 2020
(BringTetHome, 2021)

II. Marketing Mix of PepsiCo

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 Figure 15 7Ps of Marketing Mix (Pandey, 2021)

1. PepsiCo’s Products

Carbonated Beverage is PepsiCo's major product and Pepsi is the most popular beverage in
this category. The company was founded in 1898, and the current brand was launched in 1961.
Pepsi's marketing mix consisted primarily of carbonated beverages, as well as juices and snacks.
Mountain Dew and 7up are examples of soft drinks other than Pepsi. However, standing still will
never help PepsiCo become more developed, the company must expand the business market
of its products. Pepsi should go deeper into other areas such as snacks, breakfast foods
(cereals), bottled water, etc. and introduce new products in line with market trends and
customer needs, making their presence ubiquitous in almost every food and beverage sector. In
addition, despite being one of the most popular products, the ingredients in Pepsi's soft drinks
bring about negative health effects (obesity, tooth erosion, heart problems, kidney failure) and
create barriers for new consumers. To overcome this barrier, PepsiCo should revise the formula
and launch new products that reduce the concentration of ingredients such as sugar,
caffeine, fat and gas. Pepsi Diet is one of the outstanding products and a big step forward of
PepsiCo in reducing sugar.

2. PepsiCo’s Prices

PepsiCo mostly prices its products based on market orientation and customer needs, ensuring
price competition with other competitors (especially Coca-Cola) and offering products at different
prices (depending on competition and customer's pocket). To increase competitiveness, instead
of lowering prices compared to competitors to increase sales, providing advantages to match
high prices is a wise business tactic. To be more environmentally friendly, PepsiCo has
researched and launched the world's first plastic bottle made entirely from renewable energy
and waste products in food processing (Green-Pet). When successfully applied to the product,

34
users will certainly support and prioritize the company's products over other competitors. In
addition, producing products with higher prices but suitable for the segment of health-
conscious customers is also a good strategy.

3. PepsiCo’s Place

Figure 16 Distribution channel of PepsiCo

PepsiCo now uses a global network to distribute its products to consumers through distribution
intermediaries (retailers and agents). This helps businesses save costs but does not affect scaling.
However, this is the method that most businesses apply. To create an advantage over competitors,
PepsiCo should apply a distribution strategy according to a horizontal marketing system:
PepsiCo combines with fast food stores or restaurants, which means that customers eating
here can only drink Pepsi. The strong development of fast-food chains will be a great opportunity
for both partners, PepsiCo can increase sales and help these customers digest these fatty and
greasy foods better.

4. PepsiCo’s Promotion

Although Pepsi beverage products have a modern production system, traditional and sweet
flavors, and are suitable for Vietnamese people, the new product promotion and advertising
strategy is an effective means of bringing them to the market. Pepsi got closer to consumers, and
achieved the huge sales it is today. In the process of implementing the strategy, Pepsi has grasped

35
and understood each consumer's Know - Understand - Like - Believe and Buy status, from which
to effectively apply innovative support tools. Besides methods such as collaborating with
celebrities and take advantage of social networks, PepsiCo should also organize community
contribution activities to PR for the brand to help the brand closer to consumers. During this
Covid epidemic, financial support and provide medical equipment to national governments
is the most positive and effective advertising method for PepsiCo. Make a good impression on
customers and create preference when they choose the company's products over the competitors'
products.

5. PepsiCo’s People

Figure 17 PepsiCo’ employees (Diversity, Equity & Inclusion, 2021)

People or human resources is one of the core factors that play an important role in maintaining
and improving the quality of the products created. In order to be able to provide even better
customer value, PepsiCo should have its employees undergo training courses to enhance
their expertise. The most special is the customer support team because they are the connection
between PepsiCo and consumers, must be trained to respect customers and do their best to solve
customer problems. In addition, to motivate and encourage this core factor, PepsiCo should also
have incentives for employees such as commissions or bonuses.

36
 6. PepsiCo’ Process

Figure 18 PepsiCo's manufacturing process

To ensure PepsiCo's products are always available at retail stores and control inventory, the
Company should apply the latest supply chain technologies to increase efficiency in goods
management and timely delivery for customers. In addition, constantly looking for ways to
innovate and upgrade its processes in a cost-effective manner is also a good strategy of
PepsiCo. For example, the packaging stages of products instead of using people, they can apply
new advanced technologies (automatic operation) to replace and save a large amount of costs.
Cost savings in production and transportation will significantly reduce capital costs and can reduce
product costs, creating a competitive advantage over other competitors in the industry.

7. PepsiCo’s Physical Evidence

Currently, PepsiCo's product packaging is having distinct colors that are easily recognizable
on retail shelves. They are placed on special shelves of distinctive colors and designs
provided by the company. This makes it easy for customers to recognize the product in the midst
of countless other products on the market. However, this is still not the best way to encourage
customers to choose PepsiCo products. There are 2 optimal ways to solve this problem: “PepsiCo
should set up its own stores that offer only company products and exclusive promotions”
and “Design teams should collect customer feedback on packaging and suggest new
designs that make a strong impression on customers”. These strategies will highlight the
company's products as much as possible and minimize product problems.

37
 Action Program

Action Program for the marketing of a new PepsiCo soft drink with low sugar and chemical
content, suitable for people with health concerns:

Task Timeline Person in charge

I. Product advertising January to March 2022 January to March 2022
a) Name the product ⇨ January 1st to January ⇨ Design Department
- Impressive, outstanding, not 15th
duplicated with other products
available on the market
- Show the superiority of the
product clearly and accurately
b) Create an
appearance (package) ⇨ January 16th to February ⇨ Design Department
- Research and design 1st
packaging forms in
accordance with market
trends
- Not misleading about culture,
customs, or meaning
c) Advertise products ⇨ Marketing Department
- Install billboards in crowded ⇨ February 2nd to February +
places 15th Sale Department
- Create product trial locations
- Sponsor activities of festival
programs to promote products
- Use social networking
platforms to run promotional ⇨ Marketing Department
clips +
⇨ February 16th to March
d) Cooperation with Partners
31st
suitable partners
- Broadcast product
advertisements on national
TV channels
- Cooperate with restaurants
and fast-food chains such as
KFC, Lotteria, Mcdonald's
- Combined with celebrities to
increase the impact of
advertising campaigns

II. Sale and promotions April to June 2022

a) Research the market, probe ⇨ April 1st to April 15th ⇨ R&D Department
competitors to come up with a
fair price
b) Take advantage of available ⇨ April 16th to May 1st
distribution locations such as ⇨ Supply chain Department

38
 markets, supermarkets, and
grocery stores. ⇨ May 2nd to May 31st
c) Build a distribution system to
deliver products to the ⇨ Marketing Department
market, choose the right +
distributor
Partners
- Combined with food delivery
apps including Baemin, Now,
GrabFood, GoJek ⇨ June 1st to June 30th
d) Create Combos or
⇨ Sale Department
promotions when customers
buy a certain number of +
products. Finance Department
- Seasonal or holidays
discounts to stimulate
consumer demand

III. Maintain popularity July to December 2022

- Reduce advertising density in ⇨ Marketing Department
TV channels and focus on +
product advertising in social
networks to optimize financial. Finance Department
- Cooperate with KOLs (eg +
from tiktok) to create viral
KOLs
promotional videos.
- Regular promotions to
increase sales
- Continuously distribute
products to agents to avoid
stock shortages

A. Budget

The budget plan is built depends on the action plan:

No Task/ Program Budget (in VND)

1. Product advertising
a. Name the product 100,000,000
b. Create an appearance (package) 500,000,000
c. Advertise products
Install billboards in crowded places 90,000,000,000
Create product trial locations 20,000,000,000

39
 Sponsor activities of festival programs to promote products 135,000,000,000
Use social networking platforms to run promotional clips 37,000,000,000
d. Cooperate with suitable partners
Broadcast product advertisements. 18,000,000,000
Cooperate with restaurants and fast-food chains such as 60,000,000,000
KFC, Lotteria, Mc. Donald’s, etc.
Combined with celebrities to increase the impact of 1,380,000,000
advertising campaigns.
2. Sales and promotions
a. Research the market, probe competitors to come up with 12,000,000,000
a fair price.
b. Take advantage of available distribution locations such as 850,000,000
markets, supermarkets, and grocery stores.
c. Build a distribution system to deliver products to the 500,000,000
market, choose the right distributor.
d. Create combos or promotions when customers buy a 300,000,000
certain number of products.
3. Maintain popularity
Reduce advertising density in TV channels and focus on Decrease over
product advertising in social networks to optimize finance. time
Cooperate with KOLs (e.g. from Tiktok) to create viral 250,000,000
promotional videos.
Regular promotions to increase sales. 690,000,000
Continuously distribute products to agents to avoid stock 1,500,000,000
shortages.
4. Cost of risk 500,000,000,000
Total cost (in VND) 878,070,000,000
Table 2: The budget plan for marketing campaign of PepsiCo Vietnam

Control

To ensure the plan achieve the final objectives of PepsiCo Vietnam, they should follow the
detailed requirements below:

40
 About research and development:

The answers for research activities need to achieve at least 10% total population of 5 big
cities in Vietnam (Da Nang, Hanoi, Hai Phong, Can Tho, and Ho Chi Minh City):
About 20,391,520,000 people x 10% = about 2,039,520,000 answers
Among these answers, it is required that more than 80% have to be completed all questions.
If the progress of the study team is lower than requirements, it can lead to a lack of survey answers
and a delay in studying after March 15th, 2022. This comes down to the fact that the researchers
must be applied contract compensation terms if they do not obtain more than 50% of the
requirements after the survey is over.

About production and distribution:

Before June 2022, PepsiCo Vietnam has to produce and distribute at least 40,000,000
products and at least 85,000,000 products before the end of 2022. If the firm cannot sign the
contracts with retailers, fast-food chains, or other units in the distribution channels, the company
needs to update and train to enhance distributors' capacity and promote the enterprise’s marketing
activities. The cost of risk in the budget will extract to carry out these activities.

About commercialization and promotions:

Advertisements of PepsiCo Vietnam from the action plan need to access 11% of PepsiCo
Vietnam's target customers. If the celebrities or KOLs who collaborate with PepsiCo Vietnam have
scandals that can lead to the boycott movement. When PepsiCo Vietnam received many bad
feedback and reports from social media such as Facebook and Youtube, its products can be
ostracized, and the advertisements on Facebook and Youtube are also removed. The
consequences could be enormous losses for PepsiCo Vietnam in decreasing profits and affecting
the brand's image. At that time, the company needs to work with celebrities and KOLs and
announce press releases to minimize risks with PepsiCo Vietnam. Besides, the advertisements
on Facebook and Youtube has to accomplish 35,000,000 interactions at the end of June 2022. In
that case, the marketing department of PepsiCo Vietnam should reconsider having suitable plans
for boosting these advertisements and expanding the coverage of PepsiCo Vietnam.

About revenue and market share:

The revenue of PepsiCo Vietnam in 2022 has to increase 25%, higher than 2021. If the costs
of raw materials are boosted rapidly, it can increase production costs and decrease PepsiCo

41
Vietnam’s revenue while the price changes insignificantly. So the subsidiaries of PepsiCo Vietnam
can buy joint procurements to have better prices and have the same and consistent quality.
Additionally, the market share of PepsiCo Vietnam has to be at least 47% in June 2022 and
48.5% at the end of 2022.

Conclusion

Based on the above discussion, the strategy of developing a marketing plan, and a mixed
marketing strategy for the carbonated soft drink "Pepsi" will help more and more people know,
along with creating a brand name firmly in the soft drink market. Pepsico will still maintain its
leading position in front of many competitors, especially Coca-Cola – “an archenemy". Moreover,
this marketing mix (7P) strategy will bring incredible profits for Suntory PepsiCo.

42
 References

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September 2021]

Marketing AI (2020). Marketing mix of Coca-cola. [online] Available at:

https://marketingai.admicro.vn/chien-luoc-marketing-mix-cua-coca-cola/ [Accessed: 6 September
2021]

PepsiCo, 2021. Mission and Vision. [online] Available at:

<https://www.pepsico.com/about/mission-and-vision> [Accessed 12 September 2021].

Jaramillo, 2016 . [online] Available at:

<https://www.dallasnews.com/food/2016/11/16/popular-mexican-soda-manzanita-sol-gets-the-
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