A marketing mix is a set of actions applied by different companies to promote their brand to enhance revenue and profit. A typical marketing mix comprises the 4Ps that include Price, Product, Promotion, and Place : (“Putting It Together: Marketing Mix | Introduction to Business [Deprecated],” 2016). However, several other Ps have been added in recent times. The other Ps are Packaging, Positioning, People, and even Politics (Young, 2017). Comparing the two biggest soft drink manufacturers, Coca-Cola and Pepsi, will give valuable information regarding the marketing mix. Some of the Coca-Cola and Pepsi marketing mix strategies are similar, while some are different. This paper will examine the marketing mix of both companies to identify their role in their brand strategy.
The Marketing Mix used by Pepsi and Coca Cola
PEPSI
Product
PepsiCo was initially known as the Pepsi-Cola Company, and all their products were under the Pepsi brand. However, the products have evolved as a result of mergers and acquisitions. PepsiCo’s merchandise includes soft drinks, cereals, snacks, rice snacks, bottled water, side dishes, energy drinks, and sports nutrition (Young, 2017). A lot of the products were added to the PepsiCo brand through mergers and acquisitions. Recently, PepsiCo has added tumblers and t-shirts to their merchandise which other companies licensed by PepsiCo manufacture. This element of multiple products is associated with its generic blueprint and comprehensive growth strategies that accentuate international expansion.
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Place
Pepsi Co uses a transnational network to distribute its products. It depends on retailers and online merchandisers for the distribution of their products. Most of the company’s products are available at convenience stores, grocery stores, and supermarkets. Products like the tumblers and the t-shirts can be sourced from their website.
Promotion
PepsiCo’s promoting mix comprises sales promotion, advertising, direct marketing, and public relations in order of significance. However, the primary tactic applied is running advertisements and signing in celebrities to promote the brand on television, print media, radio, and the internet. The company sometimes uses sales promotions to promote the products. It also gives sponsorships to sports events to enhance their public relations.
Prices
Prices by the PepsiCo company vary as a result of a massive number of merchandise lines and brands. The primary pricing tactics applied are the market-oriented pricing strategy and the hybrid everyday value pricing strategy. The market pricing strategy is mainly used to achieve competitive prices based on the competitor’s prices and the present market conditions. However, the Hybrid Everyday Pricing method is used on soft drinks to reduce the gap between the regular prices and the discounted prices to ensure the consumers can purchase their products.
COCA-COLA
Product
Coca-Cola is distributed in over two hundred nations globally and represents almost 43 percent of all the soft drinks consumed in America every year. It is estimated that there are 1.7billion purchases of Coke products made every day. It has an extensive product portfolio of 500 sparkling and still brands (Bhasin, 2021). The most popular Coca-Cola brands are Coca-Cola, Sprite, Fanta, and Minute Maid.
Price
Coca-cola’s pricing method is referred to as ‘meet-the-competition pricing.’ The products are priced within the same range as the competition to ensure that it stands out but remains affordable. It applies the lower price strategy to increase penetration into new markets, especially those sensitive to price. Once it has established itself in the market, it repositions itself as a top-quality brand compared to other major competitors such as Pepsi. Coca-cola’s brand image mainly focuses on promoting its products by selling intangible emotional benefits with more focus on happiness and joy.
Promotions
Coca-Cola’s promotions and advertisements are known to be very innovative and effective in pushing their brand. For example, Coca-Cola uses free hotel vouchers in Europe and sponsors sporting events such as the Olympics and the National Football League “Red Zone” promotion. In 2016, Coca-Cola injected 4 billion dollars into its marketing strategy, and it increased it to $4.1 billion in 2018. Coca-cola has applied both traditional and modern marketing methods to advertise its brands. It has heavily invested in social media advertisements to connect its followers and enhance customer engagement.
Place
Coca-cola has an efficient beverage distribution system with over 250 bottling partners worldwide. The bottling partners manufacture, package, and distribute the final branded beverages to the wholesalers and the retailers, who then sell them to the identified target market.
Similarities and Differences Between Coca Cola and Pepsi’s Marketing Mix
Product
Both companies have a wide variety of products. Coca-Cola has used Coke’s secret recipe as its marketing strategy for a long time (Kayabas et al., 2018). In contrast, Pepsi has made different variations to its most famous product, the regular Pepsi Cola, to achieve a strong positioning on the diet cola market.
Price
The two companies are considered leading brands and mostly face competition; therefore, the pricing strategy is highly influenced by the competition. Coca-Cola’s pricing strategy is mainly founded on its ability to create unique value for customers in different parts of the world (Bhasin, 2021) . However, Pepsi uses the Hybrid Everyday Value method to ensure customers purchase their products even when they are not on sale.
Place
Coca Colas distribution channel is reliant on their local bottling partners who distribute their products to their customers. Pepsi is also using the same strategy to ensure its products reach consumers effectively.
Promotion
Both Coca-Cola and Pepsi heavily rely on television, radio, stores, and the internet to advertise their products. They both invest millions of dollars in celebrity endorsements. The competition between each other keeps them committed to promoting their products. They are both now focused on health and environmental safety.
Product Positioning and Brand Strategy used by Coca Cola and Pepsi
Coca cola’s market edge is sustained by their strong competitive ability and colossal market share in their primary product market. It has adopted differentiation and effective generic strategies (“Brand Analysis: Coca Cola vs. Pepsi,” 2014). It has achieved to sell more unique and diverse products compared to its competitors in terms of differentiation. It has used its marketing platforms to inspire happiness and joy through the slogan “taste the feeling.”
Pepsi, on the other hand, has created a culture that embraces individuality. It promotes itself as a refreshing drink for the youth for every social occasion. Their target market has always been the youth, with their ads characterized by fun themes, sports, and music (“Brand Analysis: Coca Cola vs. Pepsi,” 2014). They use slogans like “Be sociable, have a Pepsi” and “Any weather is a Pepsi weather.”
The Importance of Product Positioning to their Brand Strategy
Brand positioning allows the companies to strategize how the brand will be communicated to the target market. It helps them showcase their uniqueness and gives consumers an apparent reason to choose that particular brand. Product positioning also helps the company develop a meaningful narrative that the consumers genuinely connect to and increase marketing probability.
Ethical Policies and Social Responsibilities
PepsiCo identifies six critical guiding principles that guide its ethical and management policies. The policy is made up of the following guiding principles: care for the consumers, honesty, the sale of products that attract pride, balancing short-term plans with long-term ones, respect for others, diversity, and inclusion ( Kayabas et al., 2018). On the other hand, Coca-Cola’s corporate social responsibility policy is based on the positive living concept. Coca-cola focuses on active, healthy living, beverage benefits, energy and climate, the community, the workplace, sustainable packaging, and water stewardship (Kayabas et al., 2018) . Coca-Cola has also adopted some international Corporate Social Responsibility guidelines such as the Respect and Remedy Framework and the United Nations Global Compact.
References
Bhasin, H. (2021). Marketing mix of Coca Cola - 4 P’s of Coca cola - Coca cola 4 Ps explained . Marketing91. Retrieved 5 March 2021, from https://www.marketing91.com/marketing-mix-coca-cola/.
Brand Analysis: Coca Cola vs Pepsi . Content.infegy.com. (2014). Retrieved 5 March 2021, from https://content.infegy.com/hubfs/Reports/Brand-Analysis-Coca-Cola-vs-Pepsi_Report-by_Infegy.pdf.
Kayabas, T., Boyraz, G., & Derdiyok, R. (2018). Examining Coca-Cola and Pepsi Brands under the Basis of Globalisation and Multinational Companies. International Journal of Academic Research In Business And Social Sciences , 7 (12). https://doi.org/10.6007/ijarbss/v7-i12/3617
Putting It Together: Marketing Mix | Introduction to Business [Deprecated] . Courses.lumenlearning.com. (2016). Retrieved 5 March 2021, from https://courses.lumenlearning.com/wmopen-introbusiness/chapter/putting-it-together-marketing-mix/.
Young, J. (2017). PepsiCo’s Marketing Mix (4Ps) Analysis - Panmore Institute . Panmore Institute. Retrieved 5 March 2021, from http://panmore.com/pepsico-marketing-mix-4ps-analysis.
