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Archive for the ‘Advertising Strategy’ Category

 

Hi Readers,

I am conducting a comprehensive survey on “Impact of Advertisement on Consumer Behaviour” as a part of Marketing Research. The purpose of this survey is to study the effectiveness of advertising & Marketing methods adopted by Companies and also the creative techniques used for marketing the newly introduced product among the customers efficiently.

I need the views of Consumers such as you to evaluate the expectations towards the Product/Service & find measures for strengthening the same, which would be helpful for the Entrepreneurs to sustain in the competitive market. 

It would be very kind of you to spare your precious time for the same. Please try to answer all the questions in the survey. I assure you that the responses will be used only in aggregate or solely for the purpose of research and will be kept strictly confidential & it does not reveals your identity.

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                                                                               – Lavanya Selvaraj…

 

In a crowded product market, as companies are increasingly falling short of ways to differentiate their products from those of the competitors, Image Advertising seems to be a way out. Advertising is a multi-billion industry, employing hundreds of thousands of people and affecting billions of people’s lives worldwide. Yet, seeing as advertising clutter has increased tremendously and is more intense than ever, it is vital that companies differentiate themselves from competitors by creating even more powerful, entertaining and innovative advertisement messages, as well as sponsoring different events.

This article highlights the major tenets of Image Advertising, by looking at the advertising strategies adopted by PepsiCo and Coca Cola in India which spends billions of dollar on marketing strategies in order to stay key players in their industry.

The objectives of advertising campaigns are summarized below:

To inform

• Telling the market about a new product.

• Describing available services.

• Suggesting new uses for a product.

• Correcting false impressions.

• Informing the market of a price change.

• Reducing buyers’ fears.

• Explaining how the products work.

• Building a company image.

To persuade

• Building brand preference.

• Persuading buyers to purchase now.

• Encouraging switching to your brand.

• Persuading buyers to receive a sales call.

• Changing buyer perceptions of product attributes.

To remind

• Reminding buyers that the product may be needed in the near future.

• Keeping the product in buyers’ minds during off seasons.

• Maintaining top-of-mind product awareness.

• Reminding buyers where to buy the products.

 

Coca-Cola Company

 

The Coca-Cola Company is an American multinational beverage corporation and manufacturer, retailer and marketer of non-alcoholic beverage concentrates and syrups.The company is best known for its flagship product Coca-Cola, invented in 1886 by pharmacist John Stith Pemberton in Columbus, Georgia.The Coca-Cola formula and brand was bought in 1889 by Asa Candler who incorporated The Coca-Cola Company in 1892. Besides its namesake Coca-Cola beverage, Coca-Cola currently offers more than 500 brands in over 200 countries or territories and serves over 1.7 billion servings each day.

The company operates a franchised distribution system dating from 1889 where The Coca-Cola Company only produces syrup concentrate which is then sold to various bottlers throughout the world who hold an exclusive territory. The Coca-Cola Company owns its anchor bottler in North America, Coca-Cola Refreshments.

The Coca-Cola Company is headquartered in Atlanta, Georgia, United States. Its current chairman and chief executive is Muhtar Kent.

 

PepsiCo

 

PepsiCo Inc. is an American multinational corporation headquartered in Purchase, New York, United States, with interests in the manufacturing, marketing and distribution of grain-based snack foods, beverages, and other products. PepsiCo was formed in 1965 with the merger of the Pepsi-Cola Company and Frito-Lay, Inc. PepsiCo has since expanded from its namesake product Pepsi to a broader range of food and beverage brands, the largest of which include an acquisition of Tropicana in 1998 and a merger with Quaker Oats in 2001 – which added the Gatorade brand to its portfolio as well.

As of 2009, 19 of PepsiCo’s product lines generated retail sales of more than $1 billion each, and the company’s products were distributed across more than 200 countries, resulting in annual net revenues of $43.3 billion. Based on net revenue, PepsiCo is the second largest food & beverage business in the world. Within North America, PepsiCo is ranked (by net revenue) as the largest food and beverage business.

Indra Krishnamurthy Nooyi has been the chief executive of PepsiCo since 2006, and the company employed approximately 285,000 people worldwide as of 2010. The company’s beverage distribution and bottling is conducted by PepsiCo as well as by licensed bottlers in certain regions. PepsiCo is a SIC 2080 (beverage) company.

 

Identity to Image – Evolution of Strategies

 

A closer look at the brand identities of each of the brands helps assess how successful their advertising campaigns have been in creating a brand image in tune with it, while being sensitive to the value system of the target audience.

PepsiCo’s Campaign

The analysis of Pepsi, 7 UP and Mountain Dew from the portfolio of PepsiCo puts forth some interesting aspects about the evolution of these brands. Pepsi was one of the first products to Indian markets after the economic reforms of 1991.

Coca Cola takes the 2nd floor of this building for their Sales & Marketing office and puts up a hoarding. A couple days later Pepsi puts up the other board…

 

 

Pepsi:

Pepsi began with the Yehi hai Right Choice Baby campaign, which has been one of the most memorable campaigns of the brand, featuring celebrity endorsers such as Shah Rukh Khan among others. The focus, as is clearly evident, is on the product with the youth as its target segment. Yeh Dil Mange More and Yeh Pyaas Hai Badi were some of the later campaigns.

Yeh Dil Mange More campaign was again a great success, having balanced the emotional as well as the functional appeal of the product. Featuring Sachin Tendulkar and many other leading stars at that point of time, this was also one of the longest campaigns carried out by Pepsi. The company however failed to maintain the trend and leverage it. Instead of moving on to a complete emotional appeal platform, the company decided on a product based promotion campaign. Though there is still some amount of emotional appeal to its campaigns, the principal focus is on the product – it being a preferred thirst quencher.

7 UP:

In its early days, 7 UP inherited the global Fido-Dido campaign for promotion in India as well. However, with changing times and a contextual difference in India, a much more focused campaign was required. This led to the Keep It Cool campaign, which was targeted primarily at the youth and the teenager segment. Hence the appeal was at a more subtle, emotional level, which was meant to convey a potential lifestyle statement. The recent campaign of Bheja Fry essentially leverages on the same emotional appeal where the Keep It Cool campaign has been somewhat tweaked to have a local appeal.

Mountain Dew:

Mountain Dew is the latest entrant in the product portfolio. This product too has the appeal of being the drink of a daredevil or the No Fear personality. The campaigns launched include Do the Dew and Dar Ke Aagey Jeet Hai. The initial campaign was unclear in terms of its appeal and the target segment, as a result of which the brand suffered some jolts in the beginning. However, the latest campaign captures the No Fear or the Macho Man image. In this sense, the brand directly competes with Thums Up from the Coca Cola Stable.

Coca Cola’s Campaign

The Coca Cola campaign in India, however, has been different from that of Pepsi, even though they both share similar product traits. Coca Cola had a presence in India before 1977, but was subsequently forced to exit the Indian market. When the company returned to India post liberalization, it came up with an innovative communication and advertising strategy. Coca Cola has essentially been following the principle of differentiation.

Coca Cola’s 125 years booklet describes the history of advertising Strategies used by the company…

Coca-Cola_125_years_booklet

 

Coca Cola:

Jo Chaaho Ho Jaaye, Coca Cola Enjoy was one of the company’s first campaigns in India. It was remarkably well executed, and appealed both at a product level as well as at an emotional level. These ads featured celebrities such as Hrithik Roshan and Aishwarya Rai. The target segment for Coca Cola in its initial days was the youth segment and this campaign clearly connected well with the segment. However, the next advertising campaign of Thanda Matlab Coca Cola was launched with an objective to have a mass appeal. The campaign leveraged the product platform rather than the emotional platform that it had established earlier.

It is however, important to note here that Coca Cola made some exceptions for India. The company has similar marketing strategies across geographies and usually doesn’t depend on celebrity endorsements. But given the great fan-following, and in adapting to the Indian context, the company had to initially deviate from its set charter. However with the current campaign of Open Happiness, Coca Cola seems to have achieved both an emotional as well as a mass appeal. There is a very natural connect with the target segment, that of celebrating every day, and sharing small moments of joy with our loved ones, irrespective of any barriers.

Sprite:

Sprite – the other brand from the Coca Cola stable – began its journey with the campaign titled All Taste No Gyaan. This appealed greatly to the youth who don’t like to be preached and relish their sense of ownership and decision making. Sprite has never depended on celebrity endorsements as a way to gain brand recognition or consumer recall. The ads are designed to be very witty, and generally connect very well with the target audience by capturing every day moments. Seedhi Baat No Bakwaas – its next campaign – instantly connected with the target audience by coming across as a brand that was different from the other, one that focused on the individuality of the consumer. The emotional appeal is much stronger and shows a clear sign of maturity of the campaign.

In the 1980s and 1990s the battle between the two dominant brands, intensified to such an extent that the term “cola wars” was used to describe the feud. Each employed numerous advertising and marketing campaigns to outdo the other.

The Pepsi Challenge ads showing people doing blind taste tests kicked off the fun in 1975. In 1985 both were launched into space aboard the Space Shuttle Challenger with specially designed cans, although the crew considered both failures. Over the years the formula was tweaked so that Pepsi ads featured celebrities stressing the drink was the “The Choice of a New Generation”. By the 1990s the Pepsi strategy revolved around consumers being invited to “Drink Pepsi, Get Stuff” by collecting Pepsi Points on packages and cups which they could redeem for lifestyle merchandise. Millions took part and the Pepsi Stuff campaign was considered a huge success.

Pepsi continued to take the lead right through the Atlanta Olympics in 1996, even though it was held in Coca-Cola’s home town. Such was the perceived advantage that Pepsi included Mountain Dew and other products in the campaign.

The UK market played home to a “second cola war” with the launch of Virgin Cola, as well as Sainsbury’s store brand Classic Cola, which successfully competed with Pepsi and Coke for a few years before they lost out to their more established rivals. At one point Coca-Cola even sued Sainsbury’s, claiming the design of the Classic Cola can was too similar to Coke’s.

In 1997 the Spice Girls signed a multimillion-pound sponsorship deal with Pepsi and starred in three commercials, released two limited edition singles with Pepsi: Move Over and Step To Me, featured on Pepsi packaging and performed two live concerts in Istanbul sponsored by the company.

In the 21st century the two colas engaged in a “cyber-war” with the reintroduction of Pepsi Stuff in 2005, which Coca-Cola responded to with Coke Rewards. Pepsi offered consumers the chance to buy MP3 downloads and both companies offered rewards through partnerships with the iTunes Store.

Recently this longest of corporate wars has run to what could be considered a truce. Instead they use social media to push home the message that their cola is best. Quietly a form of cold war espionage exists where each tracks the other’s output on Twitter.

Campaign editor Claire Beale says: “They’ve been so dominant in the cola market nobody else has had a look-in. Consequently they’ve only really had each other to fight. But recently things have thawed and now they concentrate on keeping the market for themselves and others out.”  In the trench warfare of the soft drink industry, peace has finally broken out.

 

Proposed Framework

 

This analysis brought to light the roles played by each brand in the company’s overall advertising strategy. Not every brand took the centre-stage: some were the core brands, while others were used as defensive shields and offensive attackers to fight off competition. The following framework helps classify different brands based on the roles each of them plays:

  • The Core Brand – the flagship brand of the company
  • The Cover Brand – acts as a cushion to the core brand; soaks up competition
  • The Stand-Alone Brand – neither core nor cover; independent

 

Brand Portfolio Analysis

 

The brands in the portfolio of Pepsi and Coca Cola play an important role in terms of the overall impact they have on brand recall and consumer loyalty. The framework developed herein attempts to identify the importance of each brand in the portfolio and the role it plays.

In the case of The Coca Cola Company, Coca Cola is the core brand or the flagship brand. The focus, therefore, is on capturing the maximum value that the brand can generate. In this case, Sprite plays the role of a cover brand. Any spoof or threat on Coca Cola is countered by Sprite. However, off late, Sprite is moving up the ladder to become a core brand in the portfolio. The importance of a cover brand is that it allows for maintaining a planned advertising strategy. This builds brand value and creates no confusion about brand proposition.

Brand Roles :

In case of PepsiCo, Pepsi is the core brand or the flagship brand. However, Mountain Dew and 7 UP have played the role of standalone brands. Therefore, Pepsi has to constantly respond to spoofs and threats from other brands by tweaking or changing its planned advertising strategy. This strategy may lead to confusion in minds of the consumer about the brand proposition. Such a situation can be critical with regard to the connection a brand establishes with its target consumer segment. Recent trend suggests at Mountain Dew taking up the role of a cover brand in the PepsiCo brand portfolio.

 

Conclusion

 

This analysis led to some interesting insights. For a start, the image of the brand must be consistent not only with its identity, but with the value system of the target segment. It is, in fact, the complexity of the value system of the target segment of Pepsi and Coca Cola that allows for such a contrast in advertising styles. Furthermore, the race for prime position involves a well thought out strategy with clear cut roles for each of the brands in a portfolio. Advertising is indeed both an art and a science. The shift from information to image displays the rich potential of the advertising space. The exhilarating pace of evolution from the simple creative to the strategic takes your breath away. Definitely not for the faint hearted!

 

Wouldn’t it be great if you could read the minds of your customers and make Image advertising accordingly to create good & attractive brand image among customers?

 

 Source:

http://en.wikipedia.org/wiki/The_Coca-Cola_Company

http://en.wikipedia.org/wiki/PepsiCo

http://tejas-iimb.org/articles/

http://thedrknowitall.blogspot.in/2011/04/pepsico-creates-center-of-excellence.html

http://openmarkets.in/2161/coca-cola-records-20-increase-in-sales-in-q1

 

 

 


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