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Transcript of PepsiCo's Frito-Lay
PepsiCo that makes, markets
and sells potato chips and other
snack foods. PepsiCo creates and
sells a variety of food
and beverages worldwide.
The company is best known
for the soft drink, Pepsi. Frito Lay manufactures and sells
a variety of snack food items. They
are best known for manufacturing Lays
chips, Doritos, Tostitos, Ruffles and Cheetos. This is not their full product line, though. Frito lay also
manufactures and sells Sun chips, Matador beef jerkey, Spitz and Miss Vickies chips. Frito Lay has proven to be successful
in selling many different products and having each one be a widely known name. product life cycle Research and
development Introduction Maturity Decline In my opinion, Frito lay is still in
the growth/maturity phase. There is
still so much room for Frito lay to expand their already successful products. Frito Lay is expanding their
business via "extension strategies."
They are Changing the way they package
some of their products(i.e. different
dorito bag design.) They are constantly adding or changing flavors of their products (new/improved chip flavors.) And they reduce the price of some brands and sell them in larger quantity.(Family sized bags.)Frito Lay can still expand much further and grow more as a business by continuing to use these strategies. Growth This Graph represents the product life cycle of lays chips. The Frito Lay brand gives me the
impression that their products are healthier than the other snack food items(i.e. Skittles) because they talk about how the potato's they use are fresh, they have sugar free products, and how their ingredients are all natural. Frito LAy pricing Frito Lay sells a variety of products varying in price. For example, medium sized bag of dorito's will cost around $1.50, and a large bag of doritos will cost around $3.50-$4.50. So, i would say frito lays price range is about $1-5, depending on what size of bag and what kind of chip you are buying. Pricing strategies used in Frito Lay include price skimming and promotional pricing. For the most part, Frito Lay products cost more than no name or presidents choice chip products. This makes people think that Frito Lay chips are of a better quality than no name chips, even though they may taste the exact same. People are paying more for the logo than the actual chip, but it is working for Frito Lay. If Frito Lay has an excess of a certain product or are no longer producing a product, they will put them on sale so more people will buy more of their product, clearing Frito Lay stocks of said product. Frito Lay products are mainly sold in stores, such as no frills, sobeys, Macs, etc... And may be purchased straight from the factory, as well. Frito lay products are sold online, but not by Frito Lay. Amazon.ca does sell their products, at around $40 a bag. So going to the store is the best option. Frito Lay does not have their own store at this point. They sell their products through retailers in mainly grocery stores such as No Frills, Sobeys, Metro, etc... They are also sold in convenient stores such as Macs Milk, 7eleven etc... Promotion Frito Lay uses a variety of promotion strategies to advertise their products. One of the ways they promote their products is by using sales promotion. Frito Lay currently has a contest on where someone must think of the next lays chip flavor. Whoever wins the contest will win one million dollars. It's true that frito lay will be out a million dollars because of this contest, but their sales will skyrocket, as many adults(25+) would be thrilled to win a million dollars because of lays. Frito Lay also uses eMarketing in their promotion. They put ads for their snacks on many gaming sites such as Addicting games, Armor games, miniclips etc... Ads usually play befor the game starts, and i have personally seen many commercials for doritos, lays, cheetos, etc.. Mostly people around my age(12-16) play online games, so frito lay is targeting teenagers online. Frito Lay uses sponsorship as a way of promoting their products. Frito Lay is one of the many companies that sponsored the superbowl. Just a 30 second commercial can make a company an incredible amount of money. There are millions and millions of NFL fans, many of them are bound to go out and buy frito lay chips after seing their commercials. In this case, their target market is anyone who watches or goes to see football games, so there is a wide range of ages. Adults may buy a bag of doritos after seeing an ad, or a child who liked a commercial may get their parents to buy Frito Lay products. Frito Lay proves to be very effective in their promotion. Location Branding stage of development Product line profiling frito lay customers Frito Lay has many customers worldwide and tries to categorize them using four types of segmentation in order to meet their needs. Frito lay has many customers, but tries to target some more than others. for example, in my experience, teenagers/young adults tend to buy more junk food than older people. So, people ages 13-22 may want to buy more chips than 30 year old's. Ethnic background is not really a consideration, but where the consumers live is. The flavor of the chip has to appeal to the people living in a specific spot, and that changes as you move from country to country. For example, people in North America would prefer to eat barbeque flavored chips, whereas people living in China may prefer to eat duck flavored chips. Frito Lay must also take note of which
brands are the most popular, and the habits of their customers. If the most popular snack in Canada is cheetos, then Frito Lay should ship more cheetos to Canada than any other of their products. This way the will maximize their profit on cheetos in Canada. It is not likely that Frito Lay sells a lot of chips to professional athletes, so they need to find out what their customers like doing to sell to more people. For example, if a lot of hunters like to eat Spitz, then Frito Lay should start targeting people who go hunting while promoting Spitz. We make it natural, you make it fun! competition In general,Frito Lay has little competition. Frito Lay owns all of the major chip brands(i.e. Lays, Doritos, Cheetos, Ruffles etc...) so they do not have a lot of competition. But brands such as No Name and presidents choice that also make chips, have been troublesome for Frito Lay at times because of their lower cost. But what makes Frito Lay Different from the other companies is that they have a larger variety of snack foods to choose from. While the others do not. strengths Weaknesses Opportunities threats Frito Lay is very good at identifying their customer and figuring out how to sell a lot of their product to them Some people may end up buying no name or PC chips just because they are cheaper than theirs.
Frito Lay can only profit if people like their products, they cant control if people are willing to eat them or not Frito Lay can still expand on their products. They can sell to different regions and make new flavors depending on where they are and make more money. Cheaper chips( no name)
Can not control peoples taste, some people like chips and some people like chocolate. Frito Lay products are also sold in vending machines in many locations. These vending machines are found in schools, office buildings, malls, etc...