EXERCISE 8A

Develop Product Positioning Maps for PepsiCo

Purpose Organizations continually monitor how their products and services are positioned relative to competitors. Product positioning maps, often called perceptual maps, provide useful strategic information for marketing managers as well as corporate executives responsible for strategic planning. PepsiCo uses perceptual maps in strategic planning.

Instructions

Step 1 Review the competitors section in the Cohesion Case on PepsiCo. Review both PepsiCo and Coca-Cola Companys corporate websites especially in terms of brands and products.

Step 2 PepsiCo needs six product positioning (perceptual) maps that reveal the companys competitive position vs Coca-Cola in (1) sports/energy drinks, (2) bottled water, (3) juices, (4) carbonated beverages, (5) sparkling beverages, and (6) teas and coffees.

Step 3 Select one area (brand category) and prepare an excellent perceptual map for PepsiCos chief marketing officer (CMO).

.k Dropbox Folders. Bus Po 3e GuidetoCaseAnalysispx 9 Navigating Case Analysis y D Strategic Management -> Dreader.chegg.com/book.php?id=b42eec7b7707ebdbacdfc661dafbd1e1 DEANNA search or enter page # Strategic Management More Contents Bookmarks Competitors Although Coca-Cola is PepsiCo's major competitor, other huge firms such as Nestle S.A., Kraft Foods, Kellogg's, Mondelez, Monster, and Dr Pepper Snapple are also major rivals. In 2012, Kellogg acquired Procter & Gamble's Pringles business for about $2.7 billion. This acquisition significantly expanded Kellogg's snack food business that competes with PepsiCo. Pringles is the world's second largest snacks product doing about $1.5 billon annually in sales across more than 140 countries. PepsiCo's plan is to soon produce one half of its snacks sold in the United States with only natural ingredients by, for example, removing monosodium glutamate and about three dozen other artificial ingredients in more than 60 PepsiCo snacks such as Lay's, Tostitos, SunChips, and Rold Gold. Cover Note in Exhibit 9 that PepsiCo lags Coca-Cola in several important financial measures, including revenue per employee, return on investment, and long-term debt. Note also that PepsiCo has more than 14 times the number of employees as Dr Pepper/Snapple and almost twice Coca-Cola's. Cover As indicated in Exhibit 10. PepsiCo's packaged food and beverage sales declined 1.52 percent in 2012, but four rival firms all had increases. EXHIBIT 9 Comparative Information for PepsiCo v. Rivals PepsiCo Dr Pepper/Snapple Coca-Cola Employees ( #) Net income ($) Revenue ($) Revenue ($/Employees (#) EPS (%) Stock Price (S) Return on investment (%) Total long-term deb (S) 280,000 6.12 billion 66 billion 225,000 3.90 83 8.3 23.5 billion 19,000 630 million 6 billion 316,000 3.10 49 150,000 8.72 billion 48 billion 320,000 1.91 FM1 Concepts and Cases 10.1 14.7 billion 2.55 billion Source: Company documents EXHIBIT 10 Sales of Packaged Food and Beverages in 2012 (in millions of S) Company PepsiCo Indc Kraft Foods Coca-Cola Co.48,017 Tyson Foods General Mills Kellogg Co. 2011 Sales 66,504 18.655 46.542 32.266 14.880 13,198 2012 Sales 65.492 18.339 % Change 1.52 33.278 16.657 14.197 Source: Company documents. +3.17 +3.14 +11.94 + 7.56 : Concepts and Cases " ld1247 PM 3/10/2016 0