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Impacts of marketing
Pepsico code of ethics
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Advertisement companies are created to make a strong emotional appeal and to persuade people to buy different goods and services. Marketing specialists and advertisers use different methods to gain popularity for goods they advertise. Unfortunately, they often manipulate facts and present wrong information in order to attract public attention and gain extra profit. John Leonard vs PepsiCo suitcase is notable became it became a vivid illustration of the wrong information presented during the advertisement company. In 1996 John Leonard issued a case against the PepsiCo company because it refused to exchange his points for a Harrier Jet. John watched the advertisement Pepsi had on TV and heard about a Harrier Jet, which could presented …show more content…
after gathering 7,00,000 Pepsi points. In general, gathering points and exchanging them on different gifts became a successful marketing strategy. This initiative turned to be an effective one, and a lot of people started collecting points in order to get a gift from the company. In the end of the advertisement, which told about the opportunity to get gifts in exchange on Pepsi points, there was mentioned a Harrier Jet, available for 7, 000, 000 points. Most of the people paid no attention to this fact and it was used as an advertisement trick, aiming to attract public attention. John Leonard seriously believed in the possibility to win a jet plane. After some calculations, he came to conclusions, that he could buy a jet plane, which costed at least $33 million for maximum $ 6 million if he followed the conditions mentioned in the advertisements and collected all necessary 7,00,000 Pepsi points. After careful study of the Pepsi Catalogue, Leonard noticed that as soon as the person collected 15 points, he could buy additional points for only 10 cents per one point. After finding out this information, Leonard decided to make a try. It took him about a year to find a necessary amount of money. He had to find investors who shared his enthusiasm. “And so it was that on March 2
7th of the following year, Leonard sent 15 Pepsi Points, an order form with the words “1 Harrier Jet” written in the item description, and a cheque for $700,008.50 ($699,998.50 for the remaining 6,999,985 points and $10 for shipping and handling) to the required address and waited” …show more content…
(Smallwood).
The company did not take the letter seriously. They sent back an answer, which said that jet was showed only in advertising goals and they were not going to give it to Leonard. As an excuse, they sent a lot of free coupons to him. John Leonard was not going to give up. Later in the interview he underlined, that after watching an advertisement, he started feeling like a part of “Generation Pepsi” and started believing that he could get a Jet if followed all instruction and collected the necessary amount of points. Sincerity of his words gives reasons to feel doubts. They could be used as an informational weapon for the future court process. John Leonard hired advocates and started a court process against PepsiCo. The next letter to the company was composed by his attorneys. It sounded as “Your letter of May 7, 1996 is totally unacceptable. We have reviewed the video tape of the Pepsi Stuff commercial… and it clearly offers the new Harrier jet for 7,000,000 Pepsi points. Our client followed your rules explicitly… This is a formal demand that you honor your commitment and make immediate arrangements to transfer the new
Harrier jet to our client. If we do not receive transfer instructions within ten (10) business days of the date of this letter you will leave us no choice but to file an appropriate action against Pepsi” (Smallwood). The company again did not take the letter seriously, but still readdressed John and his partners to the advertisement company, who created the ad, which made Leonard believe in the possibility to win a Harrier jet. They also changed the number of coupons, necessary to win a plane from 7, 000, 000 to 700, 000, 000. Leonard sued Pepsi for lying to its customers and giving not true information in the advertisement. Court processes lasted for three years. Technically, Leonard had a right to get his Harrier jet as he followed all directions necessary to get the prize. From the one hand, all facts showed that Leonard was right. The text of the advertisement clearly stated that all those, who collected necessary amount of points had the right to get a Harrier Jet. Leonard collected necessary points and his letter with the check proved that fact. From the other hand, the promise was nothing but an advertisement trick, aiming to attract customers and create a nice TV picture. “The issue was finally settled in 1999 with the judge concluding that “no objective person could reasonably have concluded that the commercial actually offered consumers a Harrier Jet” (Smallwood). The court rejected Leonard’s claim because promises, given in the advertisement are not recognized as official order. Advertisements are not considered to be original selling offers. This way, it turns out that Leonard did not make any official order with Pepsi company. Moreover, the advertisement was fake from the very beginning. Harrier Jet is a military plane, and there is no possibility for a civil person to possess a plane like that. Even in the case if Leonard had won the case, Pepsi would have no opportunity to provide anybody with the plane demonstrated in the advertisement. This fact illustrates, to which extend advertisement industry manipulates facts and information. They had no intention to check up credibility of the information they provide to their customers. They are guided only by the idea to attract attention and thus gain additional profit. Pepsi also did not pay much attention to the credibility of their advertisements. Leonard’s claim sounded absurd to the owners of the company. In reality, he only demanded the company to follow promises, given in their advertisement. Leonard’s lawsuit became an illustration of the immense gap, which exists between promises, made during the advertisement company and reality.
Though Ira C. Herbert was correct that Coca-Cola had used the phrase “It’s the real thing” before Grove Press, Richard Seaver’s response was more persuasive. Herbert’s letter was formal and dry, while Seaver’s adopted an ironic tone to degrade Herbert’s case. The combination of appeals present in Seaver’s letter, when compared to Herbert’s reliance primarily upon logos, construct an argument that is
By the leader and or leaders not stating that they need a new formula, members would have probably come up with ideas such as introducing a new product instead tailored to Pepsi drinkers taste and not tinker with a winning product already. They definitely should have used a devil’s advocate to argue why their changing the formula was a bad idea, I’m sure the point of what about the current Coca-Cola’s consumers that already like and drink Coke would have come up. The most important thing was of course that they should have considered their already loyal consumers views, and not have focused so much on winning such a narrow group of Pepsi consumers, better research through surveys of their loyal customers should have revealed their feelings about a change in their beloved product and that the customer is king and not the executives when it comes to success or failure of a
Unfortunately, after the events of World War I occurred Caleb Bradham after 17 years of success experienced financial difficulties forcing him into bankruptcy on May 31, 1923. He then sold his Pepsi Cola trademark and formula to Craven Holding Corp. Further into it’s history the Pepsi-Cola corporation was formed by merging with the Dominion Beverage Company. However, in 1931 the company was bought by the Loft Candy Company, whose president at the time was Charles G. Guth who moved headquarters to Long Island City,
The Porter’s model of competitive advantage of nations is based on four key elements including factor endowments, demand conditions, related and supporting industries and firm strategy, structure and rivalry. This makes it suitable in understanding the competition existing in the soft drinks industry in the Asian markets. The factor conditions identify the natural resources, climate, location, and demographics. Coca cola and Pepsi enjoy the growing population in the Asian markets (Yoffie, 2002). A higher population guarantees the two companies adequate revenues. Other factors include communication infrastructure and availability of skilled workers. Most of the Asian countries are embracing new technologies that grow much knowledge of the diverse beverage drinks. Secondly, the demand conditions play a significant role in enhancing competitiveness for the firms. Both Coca cola and Pepsi are an
1975 heralded the Pepsi Challenge', a landmark marketing strategy, which convinced millions of consumers that the taste of Pepsi was superior to Coke. Simultaneously, Pepsi Light, with a distinctive lemon taste, was introduced as an alternative to traditional diet colas. In 1983 Coke launched aspartame/saccharin blend Diet Coke. In response in 1989 Pepsi-Cola introduced an exciting new flavor, Wild Cherry Pepsi. Thus Diet Pepsi's 'The Other Challenge' campaign was based around a 54-46% lead over Diet Coke in independently researched taste tests in Australia. It was only in 1996 that Pepsi unveiled a revolutionary 'blue' look worldwide 'to transform the image and attitude' of one of the world's best-known brands. 'Pepsi Blue represents a quantum leap into the future and redefines how the Cola Wars will be fought and won in the 21st Century.'
Analysis of an Advertising Campaign We are swarmed by advertising. Companies constantly battle to compete for the sale of their product. Adverts appear in every form of media including radio; television; Internet; billboards; newspaper; flyers and magazines. The advertiser wants us to buy their product above their competitors. The basic aim of advertising is to convince the target audience that their product is the best in the field and superior to the other products of similarity.
Numerous definitions of strategy exist, in most circumstances strategy can loosely be explained as an overall plan of deployment of resources to ascertain a favourable position within a market (Zablah, Bellenger and Johnston 2004; Grant 1994, p 14). Further, imbedded in many successful organisations are strategies, the importance of which is to remain relevant in the market, and successful in the various attributes of business; profiteering, employee motivation, maintaining sustainable core competencies, effectiveness in operation, or efficiency in the conduction of operations. Therefore challenges involved in the formulation and implementation of a strategy can revolve around the overall external market, as well as internal
As we all should know, PepsiCo is one of the world’s leader in convenient food and beverages. PepsiCo shares are traded worldwide and particularly in NYSE (United States). PepsiCo is in the same line with Coca cola and Cadbury Schweppes as the dominating beverage companies. PepsiCo has successfully built a great brand name rivaling with coca cola, probably because PepsiCo unlike coca cola has its own bottling companies. With a competitive strategy based on differentiation rather than cost leadership like its fellow competitors PepsiCo invests highly in new packaging, flavors, formulas to outsmart their competition. Founded in 1919, producing a variety of sweet and grain-based snacks, carbonated and non-carbonated
Since neither of the products created the measurable sales and market share increase Pepsi needed, PepsiCo International (PCI) executives conceived of a plan to create a new tagline and re-brand all existing Pepsi products, signage, advertising materials and in-store display units. The executives envisioned a simultaneous, global campaign that would create stronger brand equity and resonance in the consumer consciousness.
In 1893, pharmacist Caleb Bradham developed ‘Brads Drink’, a formula designed to aid in digestion. After strong interest from consumers in his pharmacy, Brad renamed the drink Pepsi-Cola in 1898 and purchased the trademark ‘Pep Cola’ for $100. The origins of Pepsi are very similar to that of Lucozade, which was also first produced for medicinal purposes. Although $100 does not appear much, that amount of money
Outline-Pepsi/PepsiCo I. Introduction a.) Pepsi is a brand far more complicated than just a simple cola product. The company, PepsiCo, has a wide spectrum of marketing perspectives that are vital to the consumers and the company. b.) PepsiCo is a global food and beverage corporation based in New York.
Pepsi was introduced in 1893 by Caleb Bradham as “Brads Drink” which then was renamed to “Pepsi Cola” in 1898. There wasn’t many options for advertising in this era due television not being introduced into households till the late 1900’s. One of the first Pepsi Cola advertisements was a black and while flyer that had a few characters laughing and read “Whoope!!! Zoom!! Drink Pepsi-Cola” at an advertisement from Pepsi, the have bright blue, red, and white colors that pop and are eye catching. Comparing this ad with a current ad and modern technology, you can see that Pepsi’s marketing and advertising techniques have come a long way. Reviewing a recent Pepsi advertisement, you can see that they have made groundbreaking changes to their branding techniques. First I will I will note that their choices in colors (red, blue, and white) for their brand are not only eye popping, but in a way symbolize the colors of America. I am not sure if this was their intent but it sure does standout. Next, there slogan in the ad states “Help Kick Off The Pepsi Super Bowl Halftime Show”, this ad targets a very large group people because its directly relating to one of the biggest sports event which is Super
Advertising is an information source to inform people about the products and prices of the company, which can help them to make informed choices. More recently, a huge amount of money has been spent on advertising throughout the world. Different types of advertisement such as television, radio, magazine, newspaper, the internet, billboards and posters can influence consumer’s behavior positively or negatively as there are different arguments and opinions. This essay will focus on the purpose of the advertisement for the company, the positive and negative effects of the advertisement on consumer behavior. According to Shimp (2007), there are five important factors which determine the purpose of an advertisement in terms of marketers’ communication with consumers.
In today’s difficult economy who can afford to spend their hard-earned money carelessly? Americans want good quality and low prices, and businesses that advertise their product make saving money possible. Advertising was created for one reason, so businesses could make known their product (Black, Hashimzade, and Myles). Some consumers may argue that advertising is not informative, but that it is manipulative because some advertisements make false claims. Fortunately, there are regulations and consumer rights that promote truth in advertising. Consumers must embrace their rights to keep advertising the way it is meant to be. Advertising is meant to be informative and not manipulative, and consumers play a great role in promoting truth in advertising.
Price and advertising strategy: PepsiCo Overhauls Statergy. PepsiCo plans on saving 1.5 billion dollars in...