Pestle and Swot Analysis of PepsiCo 2017

By: Jonathan Kush

2017 was a challenging year for the United States carbonated soft drinks (CSD) market, which has continued to decrease for nine straight years as total sales and volume of sugary sodas consumed by Americans has continued to decline for 11 consecutive years. According to Kell (2017), this is part of a long-term trend driven by consumer fears over the use of high calorie sugars and artificial sweeteners such as high fructose corn syrup and aspartame, two of the most controversial artificial sweeteners often used in diet colas. The use of such sweeteners is also the reason why sales of even diet sodas, supposed to be the industry saviours, continued to dip in 2016 with Diet Pepsi seeing a volume decline of 9.2% compared to 4.3% for Diet Coke as consumers opt for healthier options (Kell 2017).  With carbonated drinks like Pepsi Cola losing market share to non-carbonated drinks such as bottled mineral water, many food and beverage firms including PepsiCo are remaking their brand portfolios either through innovative reformulations of existing products or adding new product categories in order to tackle new food and beverage trends (Kell 2017b). In the following section, we will identify the major food and beverage trends that are driving PepsiCo’s external market environment including the US soft drinks industry in general. This will help us understand how the beverage firm can utilise its brand competencies so as to take advantage of macro environmental opportunities while at the same time neutralising emerging threats that may undermine its progress.

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