PepsiCo is all set to launch its miniature Pepsi cans (150ml) and a hydrotonic drink—7up Revive, as part of its 2016 strategy. The company is investing considerable resources to expand its portfolio of healthier alternatives with sports drink Gatorade, fruit juice Tropicana and Tata Gluco +.
We spoke to Vipul Prakash, Vice President-Beverages, PepsiCo about the company’s growing portfolio of healthier products, marketing strategy, dependence on digital association with Sports and more.
After the exit from IPL, are there any other sporting properties that you may consider to partner with in the coming time?
We already have associations with some while we are building new ones. For example, we already are sponsors for ISL, in tennis we have Vijay Amritraj’s the Champions Tennis League. We are in talks with the BCCI for a new arrangement. We have been sponsors of the ICC cricket and our association with sports will continue as it is a big platform for us.
What is your overall marketing strategy for 2016 and what are your plans about expanding the product portfolio?
We have a global commitment to move to a healthier portfolio. Consumers love CSD for taste and fun but they have other requirements as well. Given India’s sweaty temperatures and high humidity, staying adequately hydrated is all the more important and that’s where our new product 7UP Revive fits in. It is first in the category of hydrotonic drinks that contains electrolytes and vitamins and 30 per cent less sugar than Pepsi.
We did its trial run last year in Tamil Nadu and it will be launched this week first in the urban markets and later in the rural territories. We are also focusing on our Lipton Iced Tea product and targeting it to the urban audience and we plan to sell it in select channels for now. The fact is that we are looking at the health segment not as a challenge but an opportunity.
Also, in the CSD category, we have got it covered with a range of products like Mountain Dew, Pepsi, 7UP and Mirinda. Right now it is much more about new categories and that is where the growth of the industry will come from.
Product packaging has undergone tremendous change over the years. How has this impacted spends on packaging?
The increase is in double digits. The importance of packaging in the marketing mix has definitely come up. Earlier it used to be an afterthought, now people are building campaigns around it. More than the money, the mindset of the marketers and hence the consumer behavior is changing.
Consumers are paying more attention to packaging. They want to look at the label and read about it, they want to see the stories behind it. For Mountain Dew we launched limited edition package of four bottles with each telling an inspiring story. For instance there is Arunima Sinha, the first female amputee to climb Mount Everest. People want to read the story. For Gatorade we launched limited editions with Lionel Messi, Serena Williams and Usain Bolt on the package. So when you are drinking from the bottle you spend 10 min. looking at it. Take the picture start the journey. So the consumer engagement is becoming very different.
How have you used digital in your marketing mix and what are your future plans regarding digital campaigns for your products?
Digital spends will go up as it helps in the amplification of your normal campaign. But we are looking for something that can be done specific to digital campaign. For example with Revive under traditional media, when it comes to Ws of marketing, ‘who’ has been done very well by the marketers on how to target; ‘where’ has been done pretty well with outdoors. One thing not done at all is ‘why’.
I don’t need Revive if I am sitting in a five star hotel. But think about it when you walk out of it and need to catch an auto in the blazing sun. We tried this in Tamil Nadu where we had tied up with weather.com. What they do is; if you are at a place where temperature is above 38’C and humidity above 60, you will immediately get a message saying you are ready for 7UP Revive and you can geotag it and find a sampling booth. That’s digital and this is what traditional marketing cannot do.
That’s what we are trying to think about. For Gatorade we have made this film with Indian marathon runner. So digital has to be taken in the context of what the medium can do for you.
What are your plans for the rural market? Is there any specific product targeted at the rural audience?
Tata Gluco+ is totally a rural initiative, though it’s selling in the urban market as well. If you look at everything else, the only Rs 12 packet is this non-carbonated water. Travelling 300 km up and down with the glass bottle is tough. But honestly speaking rural needs are no different. Rural audiences are as aspirational as urban. We need to be clear about price value equation. Sometimes marketers over exaggerate this rural vs urban thing. It is the same consumer who wants the same thing; just the way you deliver to them might be slightly different.
The focus is on Tata Gluco+ whose distribution will increase over the next couple of months. We are also looking to bring Revive in this market. Its smaller bottle is in the planning stage which will be introduced there.
Local brands like Raw Pressery cold pressed juice and homegrown beverage maker Paper Boat are becoming hot favourites, how do you plan to counter their influence?
It is very difficult to sustain small initiatives. Is it something we should be looking at? Yes. But we are more looking at partnerships with them rather than doing it ourselves. They will give the attention and expertise in their domain, while we will provide them an all-India presence. We are actually working on these lines.
What cutting edge technology are you planning to use for your campaigns?
We don’t want technology to drive our campaigns; we have done those mistakes in the past. This thing of ‘digital first’ scares me. I always say ‘brand first.’ We have to be where the consumer is and we are not obsessed about using new technology. We should use the best medium available to be where the consumer is.