Problem
Pursuing ever-higher market share, PepsiCo continues to face head-to-head competition with Coca-Cola, Kraft, and other international and local food and beverage rivals. Although price is a big part of its marketing strategy, PepsiCo puts even more emphasis on product differentiation. This is why it has been cooking up line extensions to be introduced under its billion-dollar brands, with distinctive flavors and diverse package sizes for a range of customer preferences and budgets. Innovative product lines such as the Trop50 reduced calorie juices earn PepsiCo higher profit margins because customers will pay more for unique flavors and valued benefits. No wonder PepsiCo is pouring more money into developing new products and building on brand equity by marketing its beverage and snack brands together for more impact.
Questions
1. How is PepsiCo using price differentiation in marketing its soft drinks?
2. How does the product life-cycle help to explain why PepsiCo introduces so many flavor variations of Doritos snacks and Mountain Dew soft drinks?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.