pepsico swot and vrin (competitive advantage)

Individual Oral Presentation(PepsiCo)

Mahisha Fernando

PepsiCo

• The PepsiCo, Inc. was formed in the year of 1998 by merging two companies, Pepsi-Cola and Frito-Lay.

• By the year of 2015 PepsiCo celebrates its 50th anniversary as a combined food and beverage company (PepsiCo.com 2017).

• Mrs. Indra Nooyi (Chairperson and CEO)

QUESTION ONE

• Competition

• Health issues raised on sodas and snack

• Change in consumer taste

• Growing market – New product

• Expansion

• Targeting only the younger group

• Health Issue Concerns

• Brand Image

• Product diversification

S W

TO

Strengths

Strengths

•Higher Brand value - As of 2016

$19.4 Billion of Brand Value (Forbes 2016).- Pepsi on Forbes Lists#29 world’s most valuable brand.

Strengths

• Product Port Folio- Beverages, Snacks, Cereals (PepsiCo 2017).

Weaknesses

•Targeting only the younger age group -Forbes reports that to reach younger consumers, Pepsi has tapped many celebrities over the years, ranging from pop stars to rap and hip-hop artists.

Weaknesses• Highly depending on Walmart

Weaknesses

Opportunities

•Growing market – New product- Come up with new health drinks(ADULT GROUP).

Opportunities

•Expansion- Diversify and open up restaurants

Opportunities

PepsiCo Fast Foods

Threats •Competition

Threats •Increase trend in Health conscious product

- -fell by 8% between 2011-2014,

- decline - health and wellness concerns (Forbes 2015).

Threats •Changes in consumer tastes

Source : Brandwatch.com (2015)

Threats

QUESTION TWO

Is the resources and capabilities?

Source: Rothaermel’s (2013)

VRIO FrameworkValuable Rare Costly to

imitate

Exploited by

organization

Brand

Recognition yes No Yes Yes

Differentiation Yes Yes Yes Yes

Distribution

channel Yes Yes Yes Yes

Resources Yes No No Yes

Source: Author Developed (2017)

Competitive Advantage ?

• Differentiation and Distribution

• Innovative line of products is one of the PepsiCo competitor advantage

• it’s coming up with different tastes, different products, or even different entities such as snack foods, Pepsi explores all of its options.

• Pepsi does all it can to differentiate its products so it can remain a market leader and can continue to attempt to beat out Coke.

• Their ability to innovate is truly a competitive advantage to them.

Source: McGraw 2011

• Distribution Channel

-PepsiCo owns a couple large restaurant chains: Pizza Hut, Kentucky fried Chicken and Taco Bell

-PepsiCo pays a lot of money to restaurants to stock Pepsi. Free fridges, lower prices

Source: Dada (2016)

ReferencesForbes. (2016). 29 Pepsi. Available: http://www.forbes.com/companies/pepsi/ . Last accessed 12th January .

PepsiCo. (2017).Global Brands. Available: http://www.pepsico.com/Company/Our-History . Last accessed 12th January 2017.

Forbes. (2015). How Can PepsiCo Derive Growth From North America Carbonated Drinks?. Available: http://www.forbes.com/sites/greatspeculations/2014/11/26/how-can-pepsico-derive-growth-from-north-america-carbonated-drinks/#598b9d3a7ff7 . Last accessed 12th January .

Rothaermel, F. T. (2012). Strategic Management: Concepts and Cases. McGraw-Hill/Irwin, p. 91

McGraw,M.. (2011). Product Differentiation. Available: https://mpmcgraw.wordpress.com/2011/02/21/product-differentiation/. Last accessed 13th Januaray.

Dada,G.. (2016). What is Pepsi's competitive advantage?. Available: https://www.quora.com/What-is-Pepsis-competitive-advantage. Last accessed 12th January .