...Analysis In order to understand clearly the motivating factors of this decision, it would be useful to describe the nature and position of the two companies on the global market arena prior to the merger. Quaker Oats was formed in 1901 in Raven, Ohio by joining several oat-milling companies. Before the merger, 92% of Quaker Oats' U.S. brands held number one and number two positions in their respective categories. However, throughout its life, Quaker frequently tried itself in non-food industry, which all weakened the company's greatness and left little worse off. The primary reason was that Quaker could not handle the scale of big corporation. The biggest strategic decision that followed by a huge success was acquiring the rights to sell Gatorade, as it captured 84% of the sport drink market. In 1994, Quaker bought rights to sell Snapple, but the result was much worse than expected. Quaker bought Snapple for $1.7 billion and sold it in 1997 for $300 million, making a net loss of $1.4...
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...Gatorade | Marketing and Channel Distribution: Dr. Sean D. JassoJorge Serafio 861080548 | TA Connie Kuo | Discussion 21June 11, 2013 | Abstract: Gatorade is the single most popular sports drink in the world. This paper will examine Gatorade’s current marketing strategy and discuss the channels of distribution exploring the company’s production, supply chain management, vendor purchasing and sales. It is my goal that after reading this paper you will have an in depth understanding of how the Gatorade company operates and is continually working to expand their market share while maintaining their brand image and building their brand equity. Gatorade, is it in you? | | Table of Contents FINANCIAL COMPANY OVERVIEW 2 FINANCIAL SUMMARY 2 CURRENT MARKETING SITUATION 2 MARKET DESCRIPTION 3 PRODUCT REVIEW 3 COMPETITIVE REVIEW 4 CHANNELS AND LOGISTICS REVIEW 5 SWOT ANALYSIS 6 OBJECTIVES AND ISSUES 9 MARKETING STRATEGY 10 ACTION PROGRAMS 13 BUDGETS 14 WORKS CITED 16 FINANCIAL COMPANY OVERVIEW (End) Year | Revenue | Profit | Profit Margin | Growth Rate | Stock Price | EPS | Dec ‘12 | $65.49B | $6.17B | .94% | -1.52% | $68.43 | $3.92 | Dec ‘11 | $66.5B | $6.44B | .97% | 14.98% | $66.35 | $4.03 | Dec ‘10 | $57.84B | $6.32B | 1.09% | 33.79% | $65.33 | $3.91 | Dec ‘09 | $43.23B | $5.95B | 1.38% | -.04% | $60.80 | $3.77 | Dec ‘08 | $43.25B | $5.14B | 1.18% | - | $54.77 | $3.21 | FINANCIAL SUMMARY Over the course of the last five...
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...Joson, Gerard Gio R. EMG166-T Case analysis no. 11 – Pepsico’s Diversification Strategy In 2008 December 5, 2011 Overview Pepsico 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 is a world leader in convenient foods and beverages, with revenues of about $25 billion and over 142,000 employees. The company consists of the snack business of Frito-Lay North America and the beverage and food businesses of PepsiCo Beverages and Foods, which includes PepsiCo Beverages North America (Pepsi-Cola North America and Gatorade/Tropicana North America) and Quaker Foods North America. PepsiCo International includes the snack businesses of Frito-Lay International and beverage businesses of PepsiCo Beverages International. PepsiCo brands are available in nearly 200 countries and territories. Many of PepsiCo's brand names are over 100-years-old, but the corporation is relatively young. PepsiCo was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay. Tropicana was acquired in 1998 and PepsiCo merged with The Quaker Oats Company, including Gatorade, in 2001. PepsiCo’s success is the result of superior products, high standards of performance, distinctive competitive strategies and the high integrity of our people. Our mission is to be the world's premier consumer products company focused on convenient...
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...Justin Blubaugh English 150 Mary Carroll-Hackett 9/29/2011 How Gatorade Tricks You When a Gatorade commercial comes on, the commercial is not only advertising Gatorade products, but it is also taking advantage of our other interests in a way to sell their product, Gatorade commercials, especially ones targeting young athletes, show the companies’ extraordinary success in marketing. The commercials are an excellent example of the company’s successful use of upbeat catchy music, professional athletes and artists in their commercials, and the kind of programming strategies Gatorade uses. Gatorade commercials are known for the upbeat, catchy, youthful music they incorporate within the commercials to grab the attention of the young and athletic audience. Gatorade has used many different songs in their commercials. These are the songs that I found Gatorade uses in their commercials, and they are piano solos with Lil’ Wayne’s narrations about What is “G” (Vranica), Lock It Up (Lock It Up - Gatorade Commercial 2009 (That's G)”), and Gatorade Evolution (Lippert). Also Gatorade has used Carmina Burana(“Kevin Garnett - New Gatorade Commercial”) as the background music for countless commercials. These songs are perfect for attracting young athletes because all of the songs are catchy and they are the type of music that young athletes listen to. Lil’ Wayne is a very famous artist that focuses his music to attract high school and college aged people. Lock It Up and Camina Burana...
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...bill paxton Rhetorical Analysis Is It In You? In 1965, on a hot summer day at the University of Florida, researchers developed a new sports drink to help replenish player’s bodily fluids that they sweat out during athletic competitions. The new drink was named Gatorade, giving reference to the schools’ mascot, the Florida Gators. The drink contained water, electrolytes and a carbohydrate that helps boost players bodily fluids back to normal. Gatorade is now the most popular sports drink on the market and can be found for sale at almost any convenience store. One way Gatorade became so popular is their advertisements. Gatorade works to persuade their customers in their ads by making the consumer believe in themselves, by showing how drinking Gatorade is the best decision and by using professional athletes to promote their products. The specific Gatorade ad I am breaking down makes the consumer want to drink Gatorade before, during and after sports events and shows how Gatorade gives you everything you need in a sport drink. Gatorade has been replenishing and refueling athletes for some time now. In 2010 Gatorade introduced their new G Series line of Gatorade, which has three different segments of Gatorade: The Prime 01, the Perform 02 and the Recover 03. I will be discussing the G Series in specific. The ad shows athletes from different sports, drinking the segments of the G Series at the appropriate times. Underneath each of the athletes are bold words that stare you...
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...Strategy and Positioning Of Gatorade Pops MKT 421 October 20, 2014 Frederick Beiermeister Overview of the Organization The Gatorade Company, Inc. is a manufacturer of sports-themed beverage and food products, built around its signature line of sports drinks. Gatorade is currently manufactured by PepsiCo and distributed in over 80 countries. The beverage was first developed in 1965 by a team of researchers at University of Florida, to replenish the combination of water, carbohydrates, and electrolytes that the school's student-athletes lost in sweat during rigorous athletic competitions. Originally produced and marketed by Stokely-Van Camp, the Gatorade brand was purchased by the Quaker Oats Company in 1983, which, in turn, was bought by PepsiCo in 2001. As of 2010, Gatorade is PepsiCo’s 4th-largest brand, on the basis of worldwide annual retail sales. It competes with Coca-Cola's Powerade and Vitaminwaterbrands worldwide, and with Lucozade Sport in the United Kingdom. Within the United States, Gatorade accounts for approximately 75 percent market share in the sports drink category. The Gatorade Company, Inc. manufactures and distributes nutritional sports drinks and products for athletes. It offers sports nutrition products, energy bars, and nutrition shakes. Its sports drinks are used as official drinks by various professional and amateur athletes, sports teams, leagues, and events around the world. It offers its products through specialty stores and online. Gatorade Company...
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...Diversification Strategies Diversification strategies are used to expand firms' operations by adding markets, products, services, or stages of production to the existing business. The purpose of diversification is to allow the company to enter lines of business that are different from current operations. When the new venture is strategically related to the existing lines of business, it is called concentric diversification. Conglomerate diversification occurs when there is no common thread of strategic fit or relationship between the new and old lines of business; the new and old businesses are unrelated. Diversification is a market strategy, which is about expanding the business of the company in some way. It stretches from adding new products or services, which in some way are related to the corporation’s previous products or services on the market, too establish oneself with new, on a from the corporation’s point of view, completely unknown market (Grant). Although the idea of diversification as a strategy for growth and risk reduction is rather old, it was only after 1950 it became popular to let the corporation expand over different markets and product lines. This growth strategy continued to attract more and more companies, until it culminated in the 1970s when it became popular to build conglomerates, that is, companies expanding by adding more and more unrelated business to the corporation, often via acquisitions. In the following decades, the...
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...East Meadow NY as Unadulterated Food Products. It had a huge growth spurt with case sales doubling in 1990. Sales reached $516Mand had a return of 195.8%. Quaker Oats & its Strategy Quaker Oats is an American food conglomerate. The story of Quaker Oats’ success is one of a company led by a strong management effectively growing in the face of increasing competition and economic cycles through internal and inorganic growth. Its non-beverage businesses were growing only at 1% in real terms. It had a 10% growth target set, and that target was accomplished through acquisition strategy. To maintain this growth rate the management felt that Snapple presented highly compatible product offering. Overall, the company has used a growth through acquisition strategy and diversification. Diversity is necessary to secure the whole company’s survival. In addition, Quaker Oats thought they had the resources to make Snapple expand internationally. Gatorade Acquisition - A Huge Success Purchase of Gatorade in 1983 (as part of the Stokely-Van Camp purchase) catapulted Quaker to the top of an untapped beverage segment that, to this day, dominates 80% of the market. This deal was vital to Quaker’s long-term success. The company attributed success to its global sales and marketing team. Quaker acquired Gatorade in 1983 for $238M. Since it experienced a 22% compound growth rate with US Sales going from $122M in 1984 to $1.2B worldwide in 1993. Reasons for Acquisition of Snapple With an...
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...PepsiCo Acquires Quaker Oats The Company PepsiCo is the second largest beverage company in the world. They are internationally known for mostly their snacks and beverages. Being almost one hundred years in the business, they were incorporated in 1919. PepsiCo sells, distributes and markets a large range of these products to more than two hundred territories and countries. They are the top seller of many famous brand names such as Doritos, Lay’s, Pepsi, as well as Gatorade which came about by an acquisition of Quaker Oats in 2011. While the acquisition of Quaker Oats was not only for their beverage products but their food as well, we will be focusing on the beverage industry. The Industry The beverage industry overall does not have a huge threat of new entrants. The capital requirements to enter into this industry are very large in order to compete with the distribution levels and production lines that the biggest companies have already mastered. Not only are these factors present but the cost to purchase the materials such as machinery and modes of transportation are immense. Also the economy of scales that companies like PepsiCo have established in terms of marketing, purchasing and R&D, leave little from for new businesses to compete effectively. Furthermore the fact that to be successful in this industry means in many cases you need to be internationally sold is a huge barrier to entry since government regulation and distribution may be impossible for a smaller...
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...COMPANY CASE BRITIVIC: CREATING A BRAND FLAVOUR Part I: Brief Background History of Britvic - Mid 19thC Chelmsford a chemist begins creating homemade soft drinks - 1986 Tango acquired - 1987 Pepsi - first 20 years bottling arrangement agreed in the UK - 1995 Robinsons acquired - 2000 Orchid Drinks acquired, inc. Amé/Purdeys - 2004 Ben Shaws acquired, inc. Pennine Water - 2006 drench launched and The Really Wild Drinks Company is established - 2007 Robinsons Smooth and Fruit Shoot 100% launched - 2008 PepsiCo awards Britvic a 15 year bottling agreement for V Water - 2008 PepsiCo awards Britvic a 7 year bottling agreement for Gatorade - 2009 PepsiCo awards Britvic a 4 year bottling agreement for Lipton Ice Tea Part II: Marketing Mix Strategies a. Market Britvic’s soft drinks become most popular drink in summer among adults and children. Major supermarkets, local shops, restaurant, pubs, hotels and cinemas are among its customer. b. Product Britvic products have a wide range variety of products in terms of their drinks. From juice drinks, energy drink, kids drink up to sports drink and etc. Britvic has it Britvic doesn’t stop from producing a quality drinks for their consumers, their design really caught the attention of every individual that sees it. Also, Britvic sees to it that each of their products is nutritional to every consumer they have, and give its customer a healthy living lifestyle. The soft-drinks market is structured into two main categories...
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...be and what performance targets should we set?” (Thompson, 2012) The development of a strategy for the companies involve in the alternative beverage arena is a daunting one. There are pressing internal and external environmental factors that present significant challenges in the gaining and maintaining of market share with in the industry. The obstacles faced by these organizations include global economic slow downs, dynamic distribution channels, negative press and fickle customer tastes. These companies, however, must remain focused and vigilant to attract customers to their brands. The case study presented by John E. Gamble, Competition in Energy drinks, Sport Drinks, and Vitamin-Enhanced Beverages, outlines the boons and challenges faced by the four leading distributers of alternative beverages around the world. The industry leaders (PepsiCo, Coca-Cola, Red Bull and Hansen Natural Company) in the alternative beverage market are what is know as a strategic group. “A strategic group is a cluster of industry rivals that employ similar competitive approaches, have product offerings that appeal to similar types of buyers, and thus occupy similar market positions.” (Thomas, 2012) The four industry leaders all have various strategies to remain competitive in the alternative beverage industry. These strategies span the spectrum of the five competitive strategies. Each has a different vantage point of the industry and has...
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...had arrived. At this time, PepsiCo management decided to initiate a confidential discussion with The Quaker Oats Company about a potential business combination. Quaker Foods North America manufactures, markets, and sells ready-to-eat cereals, hot cereals, flavored rice and pasta products, mixes and syrups, hominy grits and cornmeal in North America. Products manufactured and sold include Quaker oatmeal, Cap'n Crunch, and Life cereals, Rice-A-Roni products, Aunt Jemima mixes and syrups, and Quaker grits. Gatorade, a key brand in Quaker’s portfolio, had long been on PepsiCo’s wish list. On October 5, 2000, an investment-banking team from Merrill Lynch met with the top executives of PepsiCo to discuss a possible business combination between PepsiCo and Quaker Oats. The goals of the meeting were: • To assess the value of Quaker Oats’ businesses; • To estimate potential synergies associated with a Pepsi-Quaker merger; and • To come up with an effective negotiation strategy. PepsiCo executives were confident that Quaker’s beverage and snack food business could contribute to Pepsi’s...
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...serious planning snafus. In particular, Quaker had lost $47.8 million in the second quarter of 1995, largely because of restructuring charges necessitated by its Snapple division’s poor performance and the company’s unsuccessful efforts to improve overseas sales. Quaker did not expect 1996 to be any better. Throughout the 1900’s Quaker Oats was in many businesses including Aunt Jemima pancake flour, Cap’n Crunch cereals, Fisher-Price toys, restaurants and candies. Until 1990 Quaker was still adding new products – everything from clothiers and opticians to Stokely-Van Camp, Gatorade, and Gaines dog food. A prime acquisition was Anderson Clayton & Company, a Houston food-products company that boasted such popular brands as Seven Seas salad dressings, Chiffon margarine, and Igloo ice chests. Then a downturn in 1990 convinced management to refocus the company on food. Quaker implemented this new strategy by increasing its advertising budget, reformulating its dog foods, and launching new products. Determined to emphasize its core food...
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...environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company.” Performance with Purpose “At PepsiCo, we're committed to achieving business and financial success while leaving a positive imprint on society – delivering what we call Performance with Purpose. “ “Our approach to superior financial performance is straightforward – drive shareholder value. By addressing social and environmental issues, we also deliver on our purpose agenda, which consists of human, environmental, and talent sustainability.” PepsiCo: Products * Pepsi-Cola * Pepsi, Mountain Dew, Mug Root Beer, Sierra Mist, Slice, Aquafina, SOBE, Lipton… * Gatorade * Gatorade Thirst Quencher, Propel Fitness Water, Tiger Woods Line, G2… * Frito-Lay * Grandmas Cookies, Oberto Jerky, Miss Vickie's Potato Chips, TrueNorth, Flat Earth… * Tropicana * Premium Juices, Tropicana Twister, Dole, Naked Juices… * Quaker * Quaker Oatmeal, Life Cereal, Cap’n Crunch Cereal, Aunt Jimima, Rice-a-Roni… II. Time Frame 1991 - Formed a joint venture with Unilever to sell bottled Lipton teas. 1994 -...
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...of soft drink market world wide and has over 30% share in United states alone. Pepsi has many brands in soft drinks alone namely mountain dew, diet pepsi, mirinda etc. Also pepsi has expanded its reach to other products like quaker oats, Tropicana fruit juice, lays potato chips, cheetos, Gatorade etc. One of the Pepsi’s popular product was its ‘ Diet Pepsi’. It was introduced in 1964. Its main highlight was that it was a sugar free drink making it available to all larger section people. It had zero calories and also very less sugar content it and was an instant hit among the youth. PepsiCo is a leading company in soft drinks, snacks and foods and beverages. It has a revenue of more than 39 billion dollars and has employee strength of more than 1,85,000 people. PepsiCo company consist of mainly 3 companies. PepsiCo Americas Foods (PAF), PepsiCo Americas Beverages (PAB), and PepsiCo International (PI). PepsiCo’s products are one of the most recognized products in today’s world. PepsiCo’s increase in success is mainly due to high standard of performance, commitment, determination and hard work of each and every member of the PepsiCo family. Pepsi also follows one of the best marketing strategies and business practices. PepsiCo has faced many challenges in its history. It has had its toughest competition from its rival Coca-Cola. It also faced other challenges like bankruptcy in its early stages and sugar rationing during World War 2. It has also faced a similar kind of crisis in...
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