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DESSERTAION REPORT ON SALES PROMOTION STRATEGIES OF PEPSI

Submitted in partial fulfillment of the requirement For the award of the degree of Master of Business Administration (2010-12) Submitted To:Submitted By:Mr. Azher khan . Management Dept. Roll No. 1029050000007 Amarpreet singh M.B. A. (2010-12)

Approved by: AICTE & NCTE,Ministry of HRD,Gvt of India-New Delhi. Affiliated to Uttarakhand Technical University, Dehradun.

ACKNOWLEDEMENT

I express my sincere regards and thanks to all my respected teachers who directly or indirectly helped in successfully developing / executing the project in question. It wont be out of place to mention that the process of making the project has been both educative as well as truly joyful experience. Hereby only I thank to my parents, without their unquestioning blessings and supports I would not have been here today writing these words.

(AMARPREET SINGH)

PERFACE

Report is necessary part for fulfillment of MBA course. The emphasis in the report is providing the study and an in sight into Indian pepsi. Report is designed to provide participation of MBA program as on the job experience. This has given a chance to try and apply the academic knowledge and gain insight into corporate culture. This is help in developing decision-making abilities and emphasizes on active participation by the student. I undertook my report in PEPSICO INDIA HOLDINGS Pvt. Ltd Delhi a leading Bottler and Marketing partner of the Pepsi Foods. During the report, I had worked on the report Sales Promotion strateigies in Pepsi I gained valuable experience & knowledge during the survey. The Project consists of my findings after tabulation of collected data, then analyzed conclusions were drawn and finally suggestions were put forward.

DECLARATION

I hereby declare that the Project Report SALES PROMOTION STRATEGEIS OF PEPSICO with special reference to PEPSICO INDIA HOLDINGS Pvt. Ltd Delhi submitted to Saraswati Institute of Management & Technology, Rudrapur in partial fulfillment of the requirement for the degree of Master of Business Administration. This is my original and genuine work and wherever secondary data is used, I have acknowledged the same. I solely claim all the responsibility for any shortcoming and limitation in this work.
Signature Mr-AZHER KHAN (Project Guide) Signature Amarpreet singh (Student)

Signature Pooja Johari

(H.O.D. Management Department)

EXECUTIVE SUMMARY The distribution network of PEPSI is well known for its efficiency but company constantly strives for the betterment of their distribution network system emphasis of our study was to focus on the customer of company i.e., the retailers. The Retail Mapping of Delhi is an integral step for the assessment, development and betterment of this system.The distribution system not only comprises the movement of the products but also incorporates the merchandising of the product, which is very broad in its purview. The report in corporates the analysis of the performance of PEPSI and probing into opportunities of increasing the market share in Delhi. The entire process had to be in an organized manner in order to deliver meaningful results for the purpose of decision-making. The report was that of market research with surveys and observations as its major phases with the objective of gathering of all important information material for strengthening the position of PEPSI in Delhi. PEPSI boasts of having the maximum market share in the beverage segment in Delhi. and is in constant process for the betterment of its product performance and customer as well retailers satisfaction

CONTENTS

Introduction Objective Research Methodology Limitation Scope of study Industrial Profile Company Profile Marketing Strategy Adopted Finding and Analysis SWOT Analysis Conclusion Re commendation Questionnaire Bibliography

INTRODUCTION

OBJECTIVE
1. To analyze, interpret and study the entire beverage market of Delhi. 2. Comparative study of the various brands, packs and flavors available in the market. 3. Analysis of the strong and weak point of the competitors products and compare it with PEPSI. 4.To assess the reach and feasibility of the product and give the output for further investment for enhancing the distribution network along with assessing the efficiency of the current distribution system. 5. Assess the promotional measures in the context to the sales of PEPSI and focusing our study on the customer of company i.e., the retailers. The market research was conducted in compliance of the given guidelines delivered to us expressly to achieve the given objectives, which were as under: 1. Profitability 2. Improvement 3. Sales 4. To satisfy the customers

RESEARCH METHODLOGY
THE MARKET RESEARCH PROCESS The entire project was divided into five phases and each phase had its In dividual significance and supplemented each other. The process had to be started from the grass root level and it was very important to understand the market for this FMCG product, which is very fast in production, distribution and consumption. The five phases into which the project was divided were: A. Route Riding B. Retail Tracking C. Corporate Tracking D. Analysis of finding and observations E. Segregating Delhi The entire process was more of a Descriptive Research type and incorporated a formal study of the specific problems faced by most FMCG companies an exploring the opportunities in the untapped market. The survey was conducted on the basis of PEPSI product preference and evaluation of sales forecast in the new and underdeveloped market including the evaluation of the advertising and promotional measures. The data collected had to be systematically arranged, analyzed and reported in a form congenial to take on the spot decisions. The observation approach was adopted in the process by gathering the data essential and material for the decision-making and with clear objective of increasing the market share of PEPSI in the Delhi. market. Customer preferences and satisfaction was also important in assessing the market share but that was very clear that customers generally do not have loyalty towards the product in the Beverage industry rather what matters the most is the product availability which will be discussed later. All the phases mentioned above have been discussed along with the observations, problems, and other

dimensions which have been encountered and experience in detail in the following pages.

ROUTE RIDING
The Beverage Industry or to be more specific, the Soft Drinks Industry has one of the most active network in term of its production, supply, distribution, marketing, consumption and also personal relations at the very second level of its distribution network. That is the reason why it is sometimes said to be Very Fast Moving Consumer Goods. Due to the above stated reason it becomes very essential to study and analyze the market of these products from the grass root level. So in the Soft Drinks Company as PEPSI, route riding becomes the first and foremost step in any of the activities to be undertaken be it any official so we were no exceptions. During the very initial days we were required to exercise Route Riding, the objective of which was: To understand and analyze the market in its raw and basic form. To gain an in depth knowledge of the merchandising and processing activities of the Route Agents and understand the Beverage market. To undertake the comparative study of the various brands and flavour packs of all existing beverages or soft drinks market and the market share and growth potential of each brand individually. To develop innovative ideas to enhance the distribution system. Route Riding is basically accompanying Pepsi Vans along with the route agents and understanding the way they conduct merchandising activities right from the charged vans leave the depot to the entry of empty vans back to the depot. The Route Riding phase was for the initial twinty days in which we had covered twinty different routes. The Route Riding is a crucial phase because the actual dealing with the retailers and their dealing with the customers can be very efficiently understood through this process which is important at all levels of decision making in the industry.

The Routes i.e., the Pepsi Vans were charged and left the depot by 7:30 in the morning, accompanied by the Route Agent (R.A.s). The RAs were given the route planners and the particulars of the products, flavors, and quantities along with the billing materials. The vans had to cover the entire route and the RA had to do the merchandising and sales against cash, which was a significant feature of this industry. The targets were given twice or thrice in a week that was a challenge for them and after achieving these targets the RAs was awarded with some special incentives. As there exists a player like Coca Cola. So it had a lot to do with schemes, discounts and other incentives. The routes were allocated on the basis of individual areas and the demand of the product in that particular area. The RAs been responsible for the accomplishment of their sales target on their routes and was given incentives on achieving the targets. Not only this, the RAs also had the responsibility of moving the flavors and packs in proportion along with the proper display of the products for proper visibility and arrangement of products in brand order along with VISI purity. The RAs had the responsibility of setting up Monopoly PEPSI Sales Counters where no products except that of PEPSI would be available amongst the soft drinks and

especially of Coca Cola. These monopoly sales counters enjoyed special benefits interms of discounts, schemes, VISIs (fridges), display boards, glow signboards, wall paintings, banners, posters and other incentives. The RAs had to achieve their sales target and surrender the daily sales proceeds with the concerned Customer Executives along with the route planner and billing materials and gate pass along with the details of sales on their route. The entire activities of the RAs was controlled by the Customer Executives, who also assisted the RAs in achieving their targets and were in charge of the sales performance in their assigned areas. A Customer Executive had nine to ten RAs under him and was responsible for their performances as well. He was also concerned with the promotional activities on his routes and handling of policy matters in the corporate regarding supply to industrial canteens and cafeterias. We as Research trainees were required to study and analyze the activities of the RAs and be familiar with the market. We had been provided Market Analysis Sheets by the MDC in which we were required to record the observations of the retail outlets on a particular route. The observations, which were required to be recorded in, were: The quantity of the cold and warm stocks of all brands and flavors available at the outlet along with the outlet details. Inquiring about the satisfaction of the retailers in terms of sales of PEPSI products, schemes, discounts, combo offers, and the benefits of promotional activities. Inquiring about the satisfaction by the current distribution network in context to product availability of all flavors packs or individual flavors according to demand of customers, rates billings. Inquiring about the behavior and merchandising of RAs in accordance with the companies regulations and record complaints against RAs, company or products, if any.

 Inquire about the performance of various brands and flavors packs and customers response to those brands or flavors and also to educate the retailers about various schemes and incentives to increase sales volume. Last but not the least, assessment of the effectiveness of, assessment of the effectiveness of promotional materials and activities like, display boards, glow signs, signage, wall paintings, posters, banners, racks, shelves, counters, VISIs, and also impact of nation wide advertising on brand loyalty by the customers. The information so collected was required to be filled in the Market Analysis Sheet (specimen on the next page) and reported to the MDC along with other information in order of their seriousness. RETAIL MAPPING OF DELHI The Retail Mapping is the integral part of the project and the most crucial is taking significant decisions regarding the enhancement of the distribution network involving heavy investment on account of increasing the routes and starting new routes and promotional measures on those routes to increase its market share in Delhi The new routes, exploring new markets required the decision to be supported with facts and figures which had to be provided by the Research trainees on the basis of the survey conducted in the market and processed data there of. The retail mapping had to be conducted on the basis of the Retail Tracking Sheet (RTS), which had been developed by the Marketing Development Coordinator and Customer Executives of the Delhi unit which incorporated the retail outlets, their addresses, proprietor, respondent etc and served as a vital database for all market since then for PEPSI in Delhi and had to be incorporated in the project in accordance to the companies policies.

Objectives of Retail Mapping: Segregating entire Delhi for Strong Area Programme and Weak Area Programme i.e., SAP and WAP. Assessment of retailers performance. Assessment of the level of promotional measures required for increasing market share of PEPSI. Collection of required information for making investment decisions for the enhancement of existing routes and opportunities for new routes in existing market as well as exploring new market. Classification of all retail outlets in Delhi into five broad categories viz, On Route, Non Existence, Non Potential, Reachable and Non Reachable under the head, Potential Retail Outlets. The duration for the completion of the Retail mapping took duration of 20 days. The entire survey was guided and directed by the Customer Executive and Daily report had to be presented to him after assessment and analysis along with other findings and observations. The Data had to be classified in a systematic manner and presented in a predefined format, which was further reviewed by the Marketing Development Coordinator. The Retail Mapping process incorporated of including of new outlets, which have been omitted or newly opened, and the product availability on all these outlets. The major thrust was on segregating the market for Strong Area Programme and Weak Area Programme. The Strong Area refers to the routes on which the sales targets are met without much effort and have continuous demand for the products. These areas are performing to the standards and are contented with the level of promotion schemes and other sales boosting measures. The marketing efforts are nominal in these areas because of the surplus demand and the area of concern is only to ensure the proper and efficient

supply of the products to meet the demand. In the Delhi market approximately 45% of the market can be said to be strong areas and these areas include the welldeveloped markets as shopping malls, movie theatres, convenios, hotels, restaurants and bars etc. For these Strong areas, SAP only aims at maintaining the performance of the product and enhancing the sales volume. It is not the area of serious concern for the company. On the contrary the Weak Area refers to those areas or routes, which are critically low in sales and the targets, are tough to achieve and require aggressive marketing support. The demand in these areas is fluctuating or rather feeble. The routes are the area of concern for the company as the demand is very low due to many reasons and the major one is the existence of the player like Coca Cola in the market. Other reasons could be poor distribution network, inadequate availability of the products on the outlet, inadequate promotional measures and marketing support, undeveloped market as that of the interiors etc. These weak areas had to be identified and the cause of their inferior performance had to be traced through the Retail Mapping and the company had to be provided with the facts and figures to take legitimate measure on the basis of the findings of the deficient performance of the product in these areas. This involved the aggressive marketing strategy and heavy investment decisions to strengthen these markets. For this purpose the classification of the outlets into five categories was very crucial along with the other findings and observations discussed later. These five heads of classification have been discussed as under. ON ROUTE:

It refers to the retail outlets, which are covered by the Route Agents and visited daily for sales and merchandising. The outlet is visited daily and actively involved in the sales of all brands and flavor packs of PEPSI. NON EXISTENCE: It refers to the outlets which were merchandising the product are no more in existence, i.e., they have diversified their business activity or have closed. NON POTENTIAL: It refers to those outlets, which are in existence but have very low potential in terms of sales or are not keenly interested in merchandising the products of soft drink. A careful assessment had to be done in case of Non Potential outlets, as they would turn to be potential in near future. It was also the area of operation of project to motivate these Non Potential outlets to undertake the merchandising of PEPSI. POTENTIAL OUTLETS : It refers to those outlets, which have the potential for the merchandising of PEPSI and have the required investment capabilities and can be the profitable Point Of Purchase of PEPSI by the customers. There were cases in case of these potential outlets, which were already merchandising PEPSI, and those, which did not, dealt with beverage products. The possibilities of setting monopoly counter were very fair at these outlets and were given special attention. The Potential outlets had to be further classified in two heads as below: REACHABLE POTENTIAL OUTLETS : It refers to those Potential outlet which are reachable i.e., the products can be made available with the PEPSI vans. The reach ability decision had to be taken in context to the accessibility of the vans at these outlets. NON REACHABLE POTENTIAL OUTLETS :

It refers to those Potential outlets which are not accessible by the PEPSI vans. These outlets had to be considered because the sales volume can be increased at these outlets and so alternative method of distribution and promotional activities have to be evaluated and worked upon. CORPORATE MAPPING : Delhi being an entirely industrial city had huge potential for the sales of PEPSI in corporates as these concerns had factories, offices and canteens and the officials and workers base was very strong. The process of Retail Mapping was followed by the Corporate Mapping, which incorporated of tracing of the organizations and assessing the market for PEPSI in these areas. Apart from these the database had to be updated to turn the non-potential market in the corporate into profitable liaisons for the increment of sales volume. THE OBJECTIVES OF CORPORATE MAPPING WERE: Trace the organizations with and without canteens and cafeterias and estimate the market for PEPSI. Estimate the brand preference of PEPSI and COKE in the corporates and the reasons thereof. To review the product performance and satisfaction along with the expectations of the customers in corporates including PEPSI Dispenser Equipments. To assess the product availability and demand of the product (Traffic) in these organizations as well as when the product has the optimum consumption. e.g. daily, delegations, meetings, parties, or other occasions and the customers i.e., whether the officials or workers or both. To ensure efficient supply and record any complaints or grievances thereof. To assess the promotional measures being adopted by Coca Cola for tapping these markets and locate the weak points in corporates having Coca Cola counters to convert them into profitable opportunities.

The Corporate Mapping was the supplementary programme in the project to boost the sales performance of PEPSI in NOIDA & NCR and capture the market share of its nearest competitor. The analysis and findings were recorded on the format provide by the company accompanied by the list of findings and observations in order or their preference and seriousness along with all the relevant details about the organization. The matters were discussed and analyzed carefully by the MDC. The corporate matters had to be given a special care as these had huge potential for the product. The specimen copy of the Corporate Mapping format is attached for reference. The findings and observations have been discussed in the coming pages. ANALYSIS OF FINDINGS AND OBSERVATIONS The main objective of the company is to increase the brand preference and market share so any information material form this point of view had to be take into account along with the formats provided by the company for predefined information recording and analysis of those recordings and present the information in an organize and systematic manner in a condensed form reflecting the actual position of the market. The information had to be recorded in the format along with the relevant information as per the objectives of the research and an analysis of that information had to be made and present them in an understandable format so that immediate inferences can be drawn. Generally those information had to be presented in percentages and the other findings and observations had to be evaluated and a list of findings had to be arranged in order of their seriousness and areas of serious concern along with the outlet details.

After the analysis sheets and formats have been surrendered to the C.Es after analysis by the trainees it was further analyzed and evaluate by him and a brief analysis was made each day of the daily report. The CEs further forwarded these reports after retaining the reference copy, to MDC for further review and reference. SEGREGATION OF DELHI FOR SAP AND WAP As discussed earlier that the major objective of the Retail Mapping of Delhi was to segregate the market for PEPSI for the Strong Area Programme and the Weak Area Programme. These Programme have been discussed under the Retail Mapping Head. The Data and fact collected by the survey had to be analyzed and presented in a systematic form in order to draw meaningful inferences. The finding of the Route Riding and the Survey conducted during the Retail Mapping and the Corporate Mapping were combined together and analyzed together to reach a final report ie, the RETAIL MAPPING SUMMARY or THE CONDENSED DRAFT REPORT, which gave the entire picture of the actual position if PEPSI in Delhi.. The report so prepared was on the basis of the Retail Tracking Sheet and the other supplementary finding and observations were considered to reach a consensus of declaring the route as a weak area or a strong area. The reports were analyzed thoroughly by the Customer Executives and a meeting was held for the assessment of the routes and the reasons of unfavorable performance in the weak areas and how to improve the sales on those routes. The discussion comprised of the further investments for the enhancement and extension of the routes and the level of promotional measures required in these areas. The performance of

Coca Cola was also reviewed simultaneously and a comparative study was made to assess the performance and growth in the industry. These data and figures were compared with that of the last year and a growth percentage was reached which also served as a basis of declaring an area as a Weak Area. As already mentioned PEPSI is a VFMCG so the marketing strategies are going to be very dynamic in nature. The Customer Executives had to formulae day to day strategies and these were communicated to RAs in the morning when they were going to leave the depot and this interaction among R.A.and C.E. was to be known as Gate Meeting. The programmes were to be based on the seriousness of the problems and accordingly a mild or aggressive marketing, promotional and investment programme was to be formulated.