PepsiCoemploys the multi-segment mode of positioning as it targets multipleconsumer segments with its different products and services(Bachmeier, 2013). Local market segments could be based ondemographics of age. PepsiCo focuses on reaching a diversified market(Thomas,2016).This emphasis is because the corporation serves multiple customersegments with different wants and attributes (Osterwalder,2008). Forinstance, the Pepsi cola drink has very high amounts of sugar andrefreshing taste. Nonetheless, it is not meant to serve those thatcare about the health implications of sweetened beverages. For thisconsumer segment which is characterized by the elderly population,the company offers Diet Pepsi.
ValueProposition and Customer Relations
Identificationof customer segments will drive the company into establishingdecisions on the other components of the business model. Forinstance, segmenting the consumers will make it possible to decide onthe value proposition. Value proposition refers to the bundles and ofgoods and services customers find valuable (Makadokand Ross, 2013).Pepsi-Cola and Pepsi Diet each deliver particular value to theconsumer. For example, the Pepsi Diet’s value proposition intendsto address the problem of health implications of carbonated drinks.By reducing the sugar content, the value created for the consumer isa promise of health safety, especially for diabetics and the aged. Onthe other hand, Pepsi-Cola has higher sugar content, and the valuefor the customer is the promise of a tasty drink (Makadokand Ross, 2013).With a consistent delivery of the respective value propositions,Pepsi can assure customer satisfaction hence establish good customerrelations. Maintaining such a relationship, however, requiresincreased investments in quality control regarding labor and evenproduction machinery.
KeyPartnerships and Channels
Toenhance its market reach, PepsiCo could potentially partner withlocal wholesalers, retailers, and distributors. These groups couldact as channels through which PepsiCo’s moves its products from themain centers of production to the consumer. For example, wholesalerscould be used as depots from which retailers and distributors movePepsiCo’s beverages. As for customer channels, online emailcommunication could be used to acquire customer feedback or even sendadvertising emails (Bachmeier, 2013)
KeyActivities and Resources required for the solutions
Toachieve the solutions of the problems, a variety of activities andresources are necessary. For the issue of customers’ healthconcerns, production of sugar-free products may require conductingresearch on new methods of producing the sugar-free product. On theother hand, addressing the issue of low-quality products requiresinvesting in better quality control measures to ensure uniformquality across all products. For matters of high pricing, improvingthe efficiency of large-scale production may improve the economies ofscale, consequently lowering the cost of production for each unit.With this measure, the price of the products can be adjusted toaccommodate customer’s budgetary needs while maintaining marginlevels (Makadokand Ross, 2013).
Toincrease consumers’ access to a wider range of beverages,addressing the root causes of the problem is necessary. For example,consumers may lack access due to ignorance (Bachmeier,2013).By investing in online marketing, for example, customers would bemade aware of existing products hence reduce the product discoverycurve, thereby enabling them to acquire new tastes.
Bachmeier,K. (2013). Analysisof marketing strategies used by PepsiCo.Chichester: Grin Verlag.
Osterwalder,A. (2008). Business Model Canvas Explained.Retrieved from June 26, 2013,http://www.youtube.com/watch?v=NnQrQD991hY
Thomas,J. (2016). MarketSegmentation(1st Ed.). Dallas-Fort Worth. Retrieved fromhttp://www.decisionanalyst.com/publ_art/marketsegmentation.dai
Makadok,R., & Ross, D. G. (2013). Taking industry structuring seriously:A strategic perspective on product differentiation. StrategicManagement Journal, 34(5),509-532.