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    Pepsi Next Case Study: Presented by - Surbhi Biyani Harsha Dhoot Prachi Sopariwala

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    NKD
    Pepsi Next was PepsiCo's attempt to launch a mid-calorie cola beverage with full flavor but reduced calories. They followed their typical new product development process, from idea generation through concept testing and marketing strategy development. However, the product failed to gain significant market share. Heavy focus on free trials was meant to generate initial consumer feedback, but longer-term success requires more than impulsive purchases. The case highlights challenges of introducing new products, even when following established processes, and that positive early feedback does not guarantee long-term acceptance.

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    Pepsi Next Case Study: Presented by - Surbhi Biyani Harsha Dhoot Prachi Sopariwala

    Uploaded by

    NKD
    83 views26 pages
    Pepsi Next was PepsiCo's attempt to launch a mid-calorie cola beverage with full flavor but reduced calories. They followed their typical new product development process, from idea generation through concept testing and marketing strategy development. However, the product failed to gain significant market share. Heavy focus on free trials was meant to generate initial consumer feedback, but longer-term success requires more than impulsive purchases. The case highlights challenges of introducing new products, even when following established processes, and that positive early feedback does not guarantee long-term acceptance.

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    Pepsi co Strategic Management

    Original Title

    Prachi Group

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    Pepsi Next was PepsiCo's attempt to launch a mid-calorie cola beverage with full flavor but reduced calories. They followed their typical new product development process, from idea generation through concept testing and marketing strategy development. However, the product failed to gain significant market share. Heavy focus on free trials was meant to generate initial consumer feedback, but longer-term success requires more than impulsive purchases. The case highlights challenges of introducing new products, even when following established processes, and that positive early feedback does not guarantee long-term acceptance.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    83 views26 pages

    Pepsi Next Case Study: Presented by - Surbhi Biyani Harsha Dhoot Prachi Sopariwala

    Uploaded by

    NKD
    Pepsi Next was PepsiCo's attempt to launch a mid-calorie cola beverage with full flavor but reduced calories. They followed their typical new product development process, from idea generation through concept testing and marketing strategy development. However, the product failed to gain significant market share. Heavy focus on free trials was meant to generate initial consumer feedback, but longer-term success requires more than impulsive purchases. The case highlights challenges of introducing new products, even when following established processes, and that positive early feedback does not guarantee long-term acceptance.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 26

    Pepsi Next Case Study

    Presented by –Surbhi Biyani


    Harsha Dhoot
    Prachi Sopariwala
    Objectives
    • To provide interesting insights into PepsiCo’s new
    product process
    • To understand the challenges faced by the company in
    launching Pepsi Next
    • To analyse the consistencty of PepsiNext’s product
    process with the theorectical approach towards
    product development
    • To critically analyse PepsiNext’s launch strategy
    PepsiCo
    • Second largest fast food and beverage company in
    the world
    • House of 22 brands
    • Access over 80% of world’s population
    • International(non US) market accounts for 50% of
    their total revenue
    • Strategic Approach –Innovative and adaptive
    PepsiCo Brand Structure

    PepsiCo

    Fun for you Better for you Good For You


    (Pepsi , Mountain (Pepsi Max,Diet (Tropicana,Quacker
    Dew,Doritos) Pepsi,Lays(oven baked)) Oats,Nut Harvest)
    Soft Drink Market
    • The US soft drink market generates over $70 billion
    in sales
    • Late maturity –early decline stage (since 2005)
    • New Competitors – Bottled Water , Sports drinks
    ,Energy drinks
    Impact of the emerging subsitutes
    on Pepsi
    • Decline in Market share to about less than 10%
    • Frequent come back with “reduced sugar”drinks
    • Declining carbonated drink marke by around 90
    million cases a year
    • Shift in demand towards bottled water,energy
    drinks,soft drinks
    Before Pepsi Next
    Pepsi Next
    • Launched in US market in February 2012
    • Mid calorie cold beverage – mix of sugar and artificial
    sweeteners
    • Delivers full cola taste with reduced calories
    • Prime target market – lapsed cola drinkers
    Q1

    • Outline the new product process for pepsi next.


    How consistent is their approach to the process
    described marketing textbooks?
    What is a new product?
    • Open new market
    • Improvement and revision

    Uses of new product


    • Market share
    • New segments
    New product planning:

    Opportunity analysis
    • International expansion of Pepsi next
    • New products
    Threat analysis
    • Intense competition
    Idea generation

    Idea Screening

    Concept testing

    Strategy
    development

    Business and
    financial analysis

    Test marketing

    Commercialisation
    Idea generation
    • Mid calorie cola beverage having full cola taste
    with reduced calories

    Idea screening
    • Target Market: Young generation and people
    who are very much health conscious

    Concept testing
    • Blind taste test in 2011
    Marketing strategy development
    • Positioning: Healthy product
    • Marketing: through TV, heavy free trials, social
    media, adds on YouTube etc
    • Distribution: Retailers and heavy free samples

    Business and financial Analysis


    • Market share=1%=$700 million per annum in US
    alone

    Test marketing
    • Pepsi Next was test marketed in Iowa and Wisconsin
    • Q2. PepsiCo has been quite persistent with
    pursing mid-calories beverage products – why do
    you think this ?
    Do you agree with the decision to introduce Pepsi
    Next ? Why/Why not?
    Why new products

    • Decreasing market share


    • Competitor’s product
    • Increased substitutes in market
    • Increased health consciousness
    • To fill the market gap
    Decision to introduce Pepsi Next

    • No, We don’t agree with the decision


    • Already introduced similar product four times in
    the market.
    – Pepsi Light, 70 calories
    – Jake’s diet Cola, 15 calories
    – Pepsi XL, 70 calories
    – Pepsi Edge, 70 calories
    • Even if could affect its other brand product
    Q3. How is the performance and
    market acceptance of Pepsi Next
    likely to impact the overall brand
    equity of Pepsi ?
    Should PepsiCo have launched this
    product under a new brand instead
    ?
    Pepsi Next impact on overall
    brand equity
    • If this product does not goes well in market then it
    will affect/lower the sales of the other product of the
    brand.
    • Provide competitive barrier
    Launch under new brand –
    favorable or not
    • No, PepsiCo should not have launched Pepsi Next
    under new brand.
    – Third wheel syndrome
    – Enhancing brand’s image by healthy offering.
    – Corporation will be positioned as Innovative
    and involved with community
    Q4. The launch strategy seemed to
    heavily focus on generating trials.
    Why was this important?
    How else could the launch program
    have been structured?
    Why focus on trials?
    • Fifth attempt at mid-calorie beverage
    • To identify consumer behavior
    • To identify whether Pepsi consumers are shifting or
    the corporation is expanding its consumer base.
    Alternative Launch program
    • Needful free sample in market
    • Post launch promotional campaign
    • Promotion through information dissemination
    Lessons from the case study

    • Product not be judged on Initial Impulsive


    buying
    • Product can fail even after robust product
    development
    • Not all positive feedback is good feedback

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