Economic:The financial crisis caused the Mexican peso, British pound, the Euro andthe Russian ruble to depreciate. As such, PepsiCo’s net revenue growthwas reduced by 5%. In the US, interest rates have been abysmally lowbetween zero and 0.25% since December 2008 thereby allowingcompanies such as PepsiCo to make use of low borrowing rates to invest inoperations and new product development (Murchie 2010). Likewise, in the8
BSBMKG502B - Establish and Adjust the Marketing MixUK, The Bank of England has maintained an all-time low interest rate of0.5% (BBC 2010).9
BSBMKG502B - Establish and Adjust the Marketing MixSocial:There is a new demand for healthy foods and beverages. As a result,PepsiCo is increasingly investing in developing healthier options to itsbeverages as well as promoting Heath Foods. PepsiCo has developed aBlue Ribbon Advisory Board, made up of leading health and wellnessexperts and third-party advisors from across the globe in order to help thecorporation face these newly strengthened consumer demands.Furthermore, PepsiCo has recently worked alongside the ClintonFoundation, American Heart Association, and the North Americanbeverage industry in order to set policies regarding placement of thecorrect products in the correct areas.Technological:PepsiCo Inc. relies heavily on technology to carry on its differentoperations and perform efficiently. Their technologically advanceddistribution system, Direct Store Delivery (DSD), allows them to supplydistributors and retailers with fresh stock efficiently. PepsiCo also has anextremely sound information technology infrastructure. To build andmaintain an efficient IT infrastructure is a key asset to the corporation’soperations and helps improve the communication flow within theirmassive corporate framework. It also helps them improve theeffectiveness of their operations and maintain financial accuracy.7. Identify customer/consumer priorities, needs and preferences andthe way they impact the marketing mix.Consumers' preferences to choose one drink over another are influenced, notonly by genetic, psychological and environmental factors, but also by thebeverage's specific attributes. Customers want thrill and adventure and softdrinks that energize them. To satisfy these needs of the customer Pepsi haveto launch energy drinks to its product line and promotional and advertisingactivities should also be adapted accordingly. Element of marketing mixshould be aligned with needs of customers; otherwise company will lose itsmarket share.10
BSBMKG502B - Establish and Adjust the Marketing Mix8. Consider product, pricing, promotional activities, distributionchannels and service variations. If additional products or services ornew products will be offered, evaluate these against marketingobjectives, target market characteristics and desired positioning.