Porter's Five Forces Analysis: Pepsi

Bargaining Power of Buyers: Threat from the buyers is small, this is due to the fact that there are a large number of consumers for this product and it’s price is affordable to most. Reviews of the product will be a factor that could make the product undesirable.

If one has to analyze the profitability scheme of Red Bull Energy Drink, perhaps it can be safely said that it is in a very uncompromising situation. First and foremost, the stiff competition have paved the way for the emergence of many small time players (Helm 2005). With every bottled drink that aims to steal the limelight nowadays, Red Bull should capitalize more on its creativity and ingenuity—this is of course, in relation to advertising and marketing. The company should never disregard that Coca Cola and Pepsi are still top competitors (Helm 2005). More so, even if the two share equally different components as with Red Bull, still, it is evident that the two continue to partake into the market share. Meanwhile, the notion that energy drinks offers no variety in taste is an important marketing aspect that the company should take into full consideration (Laing 2005). In 2001, Pepsi had already released AMP Energy Drink (“Amp Energy Drink” n.d). It is the company’s maidens venture into the energy drink arena. Evidently, AMP’s raison d’ etre is to capitalize on Mountain Dew’s established image. The concept would be to introduce something new, yet very familiar (“Amp Energy Drink” n.d).

Without executing properly on brand awareness a consumer will not be able to differentiate between its’ competitors. There are hundreds of different types of beverages to choose from and even sodas for that matter. In order to stay market leaders, Coke and Pepsi most continue to innovate and adapt to new competitors, not only on a domestic scale, but on a global scale. They must also continue to acquire brands that pose a threat. Below is a chart of the top, nonalcoholic beverage brands that control the marketplace.

The use of energy drinks and supplements are getting highly successful within global soft drink market. Energy drink is considered as the niche within the soft drink industry.

This is when a new company wishes to enter the market, and gain some share. Now, this can cause a company to lose substantial market share if

Big global companies such as Coca Cola and Pepsi have introduced their own energy drink versions to their product base. Mother (by Coca Cola), Amp (Pepsi), V, Battery, 180, RedEye and Bennu

The last two topics within Porter’s Five Force Analysis are the threats of substitutes and new entries. The threat of substitutes for PepsiCo and Pepsi products could be considered quite high. In recent years, Americans have been cutting back soda consumption, approximately 1.2% in 2015, and 0.9% in 2014 (Taylor, 2016). Customers have been replacing soft drinks, in particular, with water, coffees, and all natural juices. This also leads the way for the threat of new entries. As people are tending to lean away from traditional soft drinks, the threat of new entrants could be considered moderate. This is because the cost of entry is relatively low as it is not a technology driven industry. Most of the cost of entry would be related to branding and marketing of the new product (Thompson, 1996). In recent years many competitors have entered the market with desirable ingredients and non-soft-drink beverages.

PepsiCo is a large global company that has many strengths and advantages. One of Its main strengths is that its product range is diverse; this means that it doesn’t rely on a few key products or seasonal sales and isn’t significantly affected by changes in customer tastes. PepsiCo also has an extensive distribution channel

Product innovation is one of the market’s drivers of change in this industry. It is said to be one of the most important features. Innovation is important when creating a competitive global market. Alternative beverages compete to change from the tradition carbonated drinks because people are becoming more health conscience. Most alternate beverages have a differentiation in taste and this is how the companies attempt to gain loyal customers. All the beverages are unique in their own way. As a result of marketing, packaging, celebrities and endorsements this helps to create an image. Depending on the ads, this can be very beneficial for the company. The consumers of energy drink are getting younger and younger. This has a lot to do with the innovation of the brand. The marketing ads show young people enjoying these beverages after and during sporting events, fitness, or other strenuous activities. These

Pepsi has attempted to make consumers believe that consuming a Pepsi entails a refreshing; exciting experience that triggers an emotional response that can only be satisfied with their product. Examples of this can be seen in their advertisements which perceive Pepsi to be the ultimate thirst quencher unsurpassed by other brands therefore consumers who see these advertisements may experience the need for a Pepsi.

According to PepsiCo SWOT, “it is better equipped to satisfy the needs of customers with a wide variety of successful products” (2008). PepsiCo managed to present almost every type of drink and food brands. The merchandise that is earned is the majority of their revenue. This makes them extremely at risk to change any of their marketing products. However

The product seems to be an innovative idea. The price will likely be more pricy then usual soda products because the company is looking towards a premium branding for 1893. Luckily with Pepsi being a well-known, established brand, they should not have a big difficulty with placement through long established relationships and connections. Promotion would be the most detrimental strategy that Pepsi could use to launch this new soda and soda line. With declining sales it is critical that these new products do well.

As Coca Cola has many contracts with suppliers that date to a long time back, suppliers

The main purpose of this marketing plan is analyzing and examining the New Zealand energy beverages market to prepare for PepsiCo brand new energy drink category: Strawberry Sting – no fat, low sugars, high sodium and calories with sweet strawberry flavor to meet one of PepsiCo objectives: “sustainably and profitably develop company's beverage business worldwide”. (PepsiCo, 2011). Indeed, the potential market for this new product is generation Y consumers (from 18 to 24 years old), especially male.

Pepsi-Cola brand is a brand that has been established within the refreshment industry since the 19th century. Pepsi pride the business of consumer products in beverages and snacks, on being one of the best in the world. They seek