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Coca-Cola Results Continue to Slide While PepsiCo Gets Crunch from Frito-Lay

Posted by Dale Buss on February 18, 2014 04:52 PM

Coca-Cola's disappointing new financial results have underscored the important difference between Coke and PepsiCo: The latter has its Frito-Lay snack operations to drive sales increases and profitability while the soft-drink business, for both Pepsi and Coca-Cola, continues to unravel.

Still largely dependent on soft-drink sales, Coca-Cola reported a decline in fourth-quarter revenue and profits today, largely because of what seems now to be an inexorable decline in demand for its traditional Coke products in North America and no great lift overseas. PepsiCo recently reported similar struggles with soft-drink volumes but was buoyed by snack results.

North America soft-drink volumes declined by 1 percent, leading Coca-Cola CEO Muhtar Kent to call the year "marked by ongoing global macroeconomic challenges." He also said that Coke is looking to "restore momentum" in 2014.Continue reading...

brand strategy

PepsiCo Nixes Idea of Splitting Company As Frito-Lay Powers Sales Gains

Posted by Dale Buss on February 13, 2014 06:04 PM

Whatever Pepsi Beverages and Frito-Lay accomplish from here on out, they'll do it together. That was the unequivocal message of PepsiCo CEO Indra Nooyi in the company's fourth-quarter earnings report.

She acknowledged pressure from activist investor Nelson Peltz for the company to spin off the dwindling soft-drink business from the robust snack business; Peltz also has said he'd like to see Frito-Lay combine with Mondelez but recently dropped that idea after getting a seat on Mondelez's board.

Nooyi said that she even had external consultants and bankers look at the possibility of dividing beverages from snacks. But she said that the company would remain integrated after all in part as a matter of scale. "Decoupling our beverage and snaCk businesses in North America would significantly reduce our relevance to our customers," Nooyi said, according to Reuters.Continue reading...

The Big Game

For Food and Bev, Super Bowl Will Be a Battle of the Brands

Posted by Dale Buss on January 29, 2014 06:50 PM

No doubt Scarlett Johansson's ad for Sodastream will be among the most-anticipated of the the big game on Sunday. Cheerios' reprise of its mixed-race family will strike some of the most emotional cords. And a Budweiser spot featuring a puppy and a Clydesdale might convert a lot of snack-table napkins into makeshift hankies.

But more impressive than all of those things individually is the likelihood that food and beverage brands finally will rival automakers as the highest-impact vertical choosing to advertise in the Super Bowl this year. (Watch some of the Big Game spots that have already released below.)

One brand in particular, Pepsi, has a lot riding on the Super Bowl—so much in fact that the brand launched a seperate lead-in campaign to build up excitement for the Pepsi-sponsored halftime show.

"The heart and soul of our brand is pop culture and sports and music," Simon Lowden, CMO of Pepsi Beverages North America, told brandchannel. "And there's no better event than the Super Bowl to bring that to life."

The Big Game will be a major platform for Pepsi's tack to what it is calling a "master brand" strategy in which it treats the variety of Pepsi products as a single brand rather than calling out individual products as has been its tendency.Continue reading...

chew on this

Cheetos-Dusted Wings? Mtn Dew Cocktail? It's All Possible with PepsiCo, Buffalo Wild Wings Deal

Posted by Dale Buss on December 12, 2013 06:16 PM

It may not be long before Buffalo Wild Wings introduces Cheetos-flavored chicken wings to rival Taco Bell's' Doritos Locos Tacos in harnessing flavors direct from a Frito-Lay bagged-chip brand. Because under the new deal struck by the popular restaurant chain and Frito-Lay parent PepsiCo, just about anything combining restaurant food and beverages and PepsiCo IP may be—and could appear—on the table.

The immediate impact of the deal is that PepsiCo beverages, including Pepsi and Mountain Dew, are to replace Coca-Cola as the beverage supplier to one of the nation's hottest restaurant chains.

But recognizing the continued decline in the relative value of soda sales compared with other faster-growing segments of its portfolio, PepsiCo made it clear that the company believes many other dimensions of its new deal with Buffalo Wild Wings could become valuable as well.Continue reading...

brand news

In the News: Apple, Frito-Lay, Johnson & Johnson and more

Posted by Dale Buss on November 5, 2013 09:14 AM

In the News

Apple opens Arizona plant with 2,000 workers.

Frito-Lay tests chocolate-covered potato chips.

Johnson & Johnson pays $2 billion fine for false marketing of drugs.

AOL boosts ad sales but sees profits hurt by local news services.

Allen Edmonds sells to private-equity firm.

BlackBerry abandons sale process.

Christie's starts out new auction season badly.

Coca-Cola predicts personalized beverages using genomics.

DirecTV profit rises on more subscribers.

Dodge expands Ron Burgundy campaign to entire brand lineup.Continue reading...

brand news

In the News: Fiat, BlackBerry, Macy's and more

Posted by Dale Buss on October 7, 2013 09:22 AM

In the News

Fiat loses momentum in US comeback.

BlackBerry discusses bids with big-name strategic buyers that would dismember brand.

Macy's rethinks web plans in China.

Allstate outflanks online rivals.

Boston Market offers promotion related to idled government workers.

Burger King sees perception gains after "Satisfries" launch.

C-Span finds interest amid government shutdown.

Chevrolet will limit supplies of new Corvette at first.

Cracker Barrel and Kraft settle trademark differences.

ESPN drops International X Games.

Frito-Lay introduces glow-in-the-dark Halloween packages.

GM prods dealers to sell cars online.

Hershey plans plant in Malaysia.Continue reading...

campaigns

Doritos 'Crash the Super Bowl' Campaign Goes Global with $1 Million Prize

Posted by Dale Buss on September 13, 2013 12:41 PM

Frito-Lay loves the response its "Crash the Super Bowl" crowdsourced ads get for Doritos when they run during the Big Game every year, but the brand isn't resting on its laurels. For Super Bowl XLVIII on February 2, the PepsiCo snack house is expanding the program in two important ways.

In its eighth year of the highly successful "Crash" campaign, Frito-Lay plans to open the contest to would-be commercial creators from around the world, all 46 national markets where the 70 varieties of Doritos are sold, eliminating its previous restriction to the United States. Since it began in 2007, the annual contest has invited only American consumers to create and submit 30-second homemade ads celebrating their love of Doritos.

And the ad with the most consumer votes online not only will run during the Super Bowl on Fox from Met Life Stadium but also will garner for the first time a huge cash prize for the creator: $1 million. Plus, that winner and the creator of the ad that Doritos selects as its favorite, which also will run during the game, will have the opportunity to work with Marvel Studios on the set of the next Avengers sequel.Continue reading...

chew on this

Taco Bell Spices Up Doritos Locos Tacos Franchise with New Fiery DLT

Posted by Dale Buss on August 14, 2013 03:37 PM

Has Taco Bell played out the Doritos Locos Tacos space? The Yum! Brands fast-feeder will soon see as it has just announced the third installment in its wildly successful co-branded campaign. 

Taco Bell announced that its Fiery "DLT" will be officially available nationwide next Thursday, with a marketing campaign following soon. It's the next step in the company's campaign to build on the huge success of the first flavor of the popular Doritos Locos Taco when it came out last year, Nacho Cheese, and the Cool Ranch flavor that Taco Bell revealed earlier this year. The brand will be offering taste tests through social media, and will make the new taco available early on August 19—a move that didn't go so well during the Cool Ranch launch. 

The chain already has sold more than 500 million DLTs in total, almost single-handedly energizing its results over the last 17 months, so the next flavor will be crucial. And for the first time, Taco Bell chose not to borrow an exact flavor profile and product name directly from a chip already marketed by PepsiCo's Doritos brand.Continue reading...

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