iscuss whether you consider that the company’s brands/products are sufficiently differentiated (or not) from what other companies offer in that same industry. Are there major points-of-difference reflected in the report? Based on Chapter 8, discuss the branding strategy (brand architecture) of the firm. Does it use individual/separate brands? corporate/umbrella? Sub-brand names? Does it use brand portfolio(s)? Explain why.
When clicking on Passport’s health and wellness category, I did not expect to see Pepsico as a company that markets and sells this type of a product. However, after looking through their Pepsico’s key company facts, their health and wellness (HW) revenue in 2016 totaled $28 billion USD(Pepsico, 2018). To put this amount in perspective, the overall health and wellness market in 2017 was approximately $745 billion USD. This market is made up of categories that consist of Better for You, Free From, Fortified Functional, Naturally Healthy and Organic. The majority of Pepsico’s HW revenue fits into the Fortified Functional and Better for You categories which are smaller subcategories of the overall market. Pepsico’s main competitors are, hierarchically, The Coca-Cola Co, Nestle SA, Groupe Danone, Mondelez International Inc., Kellogg Co, Red Bull GmbH, General Mills Inc, Monster Beverage Corp and Suntory Holdings Ltd. These are the top 10 HW retailers in 2016 and they only make up 23% of the overall market with Pepsico sitting in 2ndplace with 4.1% of the market (Pepsico, 2018).
Pepsico’s SWOT analysis shows that its strategy is to offer a wide range of strongly branded products. Its weaknesses are their dependence on the North American market, and it is overly reliant on its Gatorade brand. Their opportunities are potential acquisitions of organic and natural based brands in addition to its well standing Quaker and SunBites products. Some threats that face Pepsico are a potential global call for heavier regulations on sugar tax as well as creating innovative HW products to offer customers(Pepsico, 2018). Having considered these. Pepsico appears to be well positioned to continue growing its HW revenue as they have done year after year between 2011-2016.
Pepsico’s strategy is to offer a wide array of products in the North America region and mainly sports nutrition drinks like their Gatorade brand. However, they are scarce in other regions of the globe and need to diversify to spread out potential revenue risks. It’s strategy for developing its Quaker oats brands as a healthy image should help with aging populations in other countries. Pepsico is oriented to consumer markets and not business markets because the products they offer are typical of those that could be found at a typical grocery store.
Pepsico. (2018, January 18).Pepsico Inc in Health and Wellness (World). Retrieved from Passport: https://www-portal-euromonitor-com.manowar.tamucc.edu/portal/analysis/tab