The case study focuses on Pepsi’s distribution strategy and channels that affect the market share in developing countries. Although the company competes globally, accesses to markets such Ukrainian not been able to sustainable compared to its competitors such as Coca-Cola (Crawford, 2018). The company relies on interchangeable supply routes that involve 12 bottling companies who sell to distributors that sell the product to the retailers. While the supply chain might be efficient to locals, it adversely affects the costs and profit margin of the company. Pepsi faces supply chain and demand gaps leading to adverse impact on the market presence and outsourcing of distribution channels. The company is also at risk of channel conflict due to interdependence of different parties and lack of power control.
What are the efforts that can reduce demand and supply gaps?
The company has to consider the evaluation of the distribution strategy that maximizes demand and supply. The current approach works best for the urban residents who can access the product from numerous shops. However, the strategy is limiting to the rural customers who are a crucial target of the product. Through enterprise resource planning (ERP), it can ensure the company extends IT infrastructure that enables efficient supply chain analytics, supply chain execution, extended warehouse, distribution, and transportation systems. Therefore, the company must focus on reducing supply and demand gaps to cater to consumer needs. Through reliance on expatiating supply chain managers, the company can tap into the market through reliance on proper channels.
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What can the company do to reduce possible channel conflict?
The adaptation of a clear supply chain system is the key to service and reduced conflict. With reliance on state of an art logistic system, the company can create operational networks that guarantee market presence. To communicate, it can utilize supply chain collaboration to synchronize its high number of suppliers across countries. Collaboration assists manufacturers in making decisions regarding inventory reduction and agility improvement ( Grant et al., 2017). Its manufacturers outsource to participate in the networked supply chain and encouraged other partners to do the same. Additionally, the entity must consider relationship marketing within its channels to ensure that players can establish trust and respectable engagement. Also, the managers can establish strategies that determine power control and collaboration of efforts that establishes power control platforms. Through the interaction with the entity can determine the routes that are not efficient and respond accordingly.
What market channels can be utilized to maintain the market share?
Outdoor promotions and digital marketing approaches will be ideal. The company has diverse products that include beverages, snacks, and food products. There is a need to focus on efforts on how to attract young adults through social media platforms. For instance, through online advertisements on Facebook or Twitter, young people can get additional information on the products they were unaware of. Moreover, the outdoor promotions cater to older adults that might not rely on digital platforms for product alternatives. The efforts will be instrumental to ensure faster growth in sales with an increased market share. The marketing strategies align with its demographic consumer segment, focusing on young users who seek to form genuine connections. To enhance its market share and ensure communication to its consumers, the organization can rely on service marketing approaches such as micro-influencers, web marketing, optimizing of search engine, co-branding, and experimental marketing to reach the millions of consumers in developing countries.
References
Crawford, R. (2018). Marketing Channels and Logistics: A Case Study of Pepsi International.
Grant, D. B., Trautrims, A., & Wong, C. Y. (2017). Sustainable Logistics and Supply Chain Management principles and practices for sustainable operations and management.
