The matrix is misrepresenting in some cases. Example: Coca Cola and Pepsi. Coca Cola is market leader, as a result of which the relative market share. Overview∗ Company Overview ∗ Strategy Formulation∗ History of Pepsi ∗ SWOT Matrix ∗ Grand Strategy Matrix∗ Growth ∗ BCG∗ Beverages Pepsi-Cola North America Pepsi-Cola Mountain Dew .. Hut Taco Bell Low High 10% BCG Matrix for PepsiCo – Early s;
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BCG Matrix also is known as the growth-share off is used by organizations to classify their business units or products into 4 different categories: The growth rate of an industry and the market share of a respective business relative to the largest competitor present in the industry are taken as the basis for the classifications, for that reason, BCG Matrix is also called as Growth-Share Matrix.
BCG Matrix of Pepsi | BCG Matrix analysis of Pepsi
Past few years have been an inflection point for the company with Pepsico seeing a major drop in their carbonated mattix business, thus prompting it to go back to the drawing board and relook at its future strategy and also its product offerings.
In this BCG matrix, we will talk about different brands of Pepsico which over the years have seen a fall in market share due to changing market scenarios and also brands which saw exponential growth in their market share. These are low growth or low market share products and have very few chances of showing any growth. The investment strategy for these products has to be very well thought through by the management as there are chances that these businesses might not yield any profit for the organization.
These business units or products are cash traps and therefore are not seen as a useful source of earning. Products which are market leaders in their specific industry and their industry is not expected to see any major growth in the future are considered as Cash Cows. These products are the money churners for the company and require very low investments to sustain their leadership and profitability in the market.
BCG Matrix of PepsiCo
Products or Business Units which hold a high market share and are also considered to grow in the future are positioned as Stars. As a result, companies are interested to invest in developing these units further to gain a larger market share and attain a stronger position in the market.
These products have the potential of being positioned as cash cows in the future owing to the industry growth prospects. Products or business units of the company that are still in the nascent stage of their product lifecycle and can either become a revenue generator by taking the position of a Star or can become a loss-making machine for the company in the future. The industry has high potential to grow hence giving the room to the products to grow as well only if the pertinent issues are managed effectively.
S with a The product requires very less investment to maintain its market share and fight off any competition. The products or business units that have a high market share in high growth industry are the stars of the organization. Over the years, Pepsi has faced stiff competition from Coca-Cola and has also seen its market share take a hit.
BCG Matrix of PepsiCo | | BCG Matrix Analysis
The company has to spend millions of dollars on brand awareness and promotional activities in order to maintain its market share. People are turning away from sugary drinks and empty calories.
Because of stiff competition from Coca-Cola and peepsi customer preferences towards healthy and low-calorie drinksPepsi is seeing a shift from STAR quadrant to Dogs quadrant. Ot is slowly and steadily catching up with Bisleri and is expected to see a twice a growth in the next 5 years.
Amid falling sales of aerated drinks as consumers shift to healthier drinks, Pepsico aims to double the Tropicana business by Carbonated soft drinks segment has seen a pepdi decline in the past few years, the overall liquid refreshment beverage market has been growing. This change in consumer preferences is what has helped Gatorade see an exponential growth in its market share.
Growing healthier lifestyle trends and emerging markets have prompted the brand to invest large amounts of investments in healthier beverages and snacks in order to differentiate from competitors and grow brand awareness.
There are products that formulate a part of the industry that is still in the phase peps development, yet the organization has not been able to create a significant position in that industry.
The small market share obtained by the organization makes the future outlook for the product uncertain, therefore investing in such domains is seen as a matrid decision. Diet Sodas, once seen by consumers looking to cut calories as an alternative to traditions sodas, are losing their fizz.
Dogs are those products that were perceived to have the potential to grow but however failed to create magic due to the slow market growth.
Failure to deliver the expected results makes the product a source of loss for the organization, propelling the management to withdraw future investment in the venture.
Since the product is not expected to bring in any significant capital, future investment is seen as a wastage of company resources, which could be invested in a Question mark or Star category instead.
Declining carbonated soft drinks segment share due to increasing demand for low calorie and matriz beverages and snacks is what is attributing the diminishing sales of Pepsi brand. Learn the BCG Matrix of Samsung and understand different business units which fall under different quadrants. Your email address will not be published. August 26, heartofcodes Leave a comment. Leave a Reply Cancel reply Your email address will not be published.