Pepsi Refreshing The World With A Change — Pepsi Case Study

Hurray, 3rd case study in the Marketing in a Digital World course on Coursera. I am more than excited to share this one with you, my readers. Hope you enjoy reading this piece and learn something new.

Source: Slideshare

What should be the criteria to evaluate a digital marketing promotional campaign?

Digital marketing is the marketing of products or services with the help of digital tools and mediums. Digital marketing is a very powerful way of reaching targeted consumers and yielding sales. But it is very important to evaluate the campaign for the firm. It is especially important to make sure the funds spent in the promotion give a good ROI (Return on Investment). There are some general ways to evaluate a promotional campaign done through digital mediums, such are discussed below:

• Set clear and mutual goals:

Setting goals is crucial for any sort of business activity and digital marketing promotion is nothing different here. A firm should be clear about its goals in terms of what it wants to achieve and the goals must be realistic, and sustainable. The firm should assess its past performance to set realistic goals and should also consider it’s social responsibilities to bring positive changes to the world while also trying to achieve corporate goals. The goals should be mutually benefitting to the company as well as other parties. The goals could be an introduction of a new product or the expansion of current product line, spreading awareness among the current consumer base or trying to capture a wider base of customers, improving sales performance or expanding sales to newer geographical locations.

• Identify target audience:

A promotional campaign is done with an objective to convey a message to an audience and if the targeted audience is not clearly identified and defined then the message may be lost and may not yield desired goals. It is very important to be certainly clear of what message, whether emotional or informational, is being provided to what customer and the customers can be targeted with the help of various tools and factors such as age, demographics, online activity, etc.

• Key Performance Indicators (KPIs):

KPIs are the tools used to how has the promotional campaign performed in terms of different numbers. Few examples of such Key Performance Indicators would be search engine rankings, traffic and sources of traffic, average stay per visit, conversion rates — how your traffic turns into sales, and ROI — Return in terms of sales revenue on the investment done in the digital marketing campaign, etc. KPIs can be monitored and assessed to bring changes to the current campaign or to start or end a campaign. These metrics help the management in calculating the profitability of the campaigns as well as to analyse customer data such as age, location, gender, preferences and so forth. Analytics such as website analytics, SEO analytics and social media analytics can be used to make monitoring and measuring of these metrics easier.

• Benefits:

The benefits of a digital marketing campaign can be both tangible as well as intangible. Tangible benefits would clearly be the sales figures and the percentage of increase in sales during and shortly after the campaign, and ROI — return on the investment made in the campaign. Or, the benefits of the campaign could be intangible benefits such as better product/brand awareness, more customer engagement, and many more. The benefits could also be short term or long term. In other words, the returns from these promotional campaigns can be scaled to a period from a quarter to a year or even a multi-year period.

As a conclusion, it is a very straightforward yet narrowed approach to evaluate a digital marketing promotional campaign and instead, one should rather focus on the above factors while doing so.

Source: https://medium.com/@shridevi.j.2008/

Was the Pepsi Refresh Project successful? Why or why not?

PepsiCo is an American multinational company producing food, snacks and beverage that started out as a carbonated soft drink manufacturer in 1902. The company has been very successful in its operations since its inception. PepsiCo had been advertising its products every year in the Super Bowl, an annual championship game of the American NFL teams, for 23 years up until it decided to spend the advertisement budget in digital marketing in 2010. It launched a website as RefreshEverything.com as a part of the Pepsi Refresh Project, a digital marketing campaign by PepsiCo to identify and fund $20 million into social causes. PepsiCo set a system for individuals and organisations to submit ideas across six different categories i.e. health, arts & culture, food & shelter, the planet, neighbourhoods and education, and to provide grants ranging from $5,000 to $2,50,000 to the highest voted ideas. I believe this project, despite being a great initiative, failed to be a successful marketing campaign. I will further explain the reasons why this project was very good yet a failure from the sales perspective.
The Pepsi Refresh Project had a positive effect on the company in the following ways:

• PepsiCo was the first in the industry to abandon Super Bowl and adopt digital marketing to promote their product. It was considered as a bold move at that time and PepsiCo got a lot of media coverage. Forbes even ranked it #5 in the Best Ever Social Media Campaigns list.
• PepsiCo gained a lot of social media impressions and built a strong internet presence. That has helped the company to be known by a much bigger population. If we consider the number and stats, the website i.e. refresheverything.com received 1,000 unique visitors within the first one month, and about 18 million unique visitors with 80 million votes by the end of the campaign. It received 1,50,000 tweets on Twitter and 4 million likes on Facebook. This sort of social media presence makes the consumer feel like they have a connection with the company and the company feels familiar to them.
• PepsiCo built long term brand equity with the brand engagement it gathered during the period of the campaign. It is known that about 37% per cent of Americans were aware of the project. That means the project had created plenty of awareness among the targeted audience.
• The project helped PepsiCo to make its customers and other third parties to consider this project as a part of its CSR — Corporate Social Responsibilities. Companies that focus on their CSR are usually the ones to gain a lot of confidence and support from the customers as well as organisations.

Despite the benefits of this project to PepsiCo, it suffered from being a failed attempt at marketing its products from sales and promotion point of view. PepsiCo had to drop the project just within 2 years of starting it.

• Pepsi’s sales declined drastically i.e. by 6% after a year of this campaign while the ongoing decline in sales of carbonated beverage at that time was 4.3% on average. That clearly means the project didn’t register as many sales as PepsiCo would have expected with the traffic it received on the internet. PepsiCo, in fact, dropped to rank 3 below Coke and Diet Coke, from the previous rank of #2 in the top soft-drink brands in America ranking.
• The previous point also brings up the fact that online customer engagement did not convert into direct sales was another reason how the project was a failure. PepsiCo failed to implement a system to link the customer’s interaction and sales.
• PepsiCo focused on multiples issues at once in this project. It had 6 broad categories and there were way too many issues and ideas under those 6 broadheads, so it didn’t help PepsiCo to target a specific audience. Thus, the impact of the campaign lacked concentrated strength.
• There was a huge mismatch between the targeted consumer and major participants. The winners or the major participants of Pepsi Refresh Project were mostly organisations, foundations and institutes while their customers are usually individuals. Individuals already felt not being a part of the project as the organisations had a major influence of their ideas in the project and on top of that, those non-profit organisations reportedly adopted unfair means of winning the votes to get the funds. This might have reduced the brand value of PepsiCo in front of their customers as they further reported that PepsiCo didn’t respond to their calls and emails regarding the cheating acts of non-profits organisations.
• Another mismatch was the actual product and the subject of the campaign. Pepsi was a carbonated soft-drink and the subject of the marketing campaign were health, social, environmental and various other issues. Pepsi did not even have a connection with the ideas or issues in the Pepsi Refresh Project. The project could have been a huge hit for some other company but it just wasn’t the right marketing strategy for PepsiCo.
• Pepsi’s promotion felt very unauthentic because it is a carbonated drink that is considered very unhealthy and one of the biggest contributors to America’s obesity problem. A product that unhealthy does not convey much of a valuable message about it when it is marketed through the issues of society and ideas to fix those. Pepsi has always been related to pop culture, sports and music. Being such a product, it totally lacked a connection with the problems of society.

A screengrab of the pepsirefreshproject website. Source: www.adeevee.com

What should Pepsi do about this project?

Pepsi did away with their Pepsi Refresh Project in 2012, within just 2 years from starting due to its failure in a sales perspective even after it tried to tweak the project a bit in the span of those 2 years. Pepsi was a product and brand of youth and care-free that were connected with pop culture, music and sports but with this discussed project, it tried to cater to the generation that cared for various causes. PepsiCo replaced Pepsi Refresh Project with Pepsi Pulse (known as Live for Now globally outside of the US) that also replaced slogans like “What do you care about” and “Do some good.” with the slogans such as “Live for Now.” and “Now is alive, fun and fearless. Now is refreshing. Now is epic…”However, I think it’s a shame that PepsiCo pulled the plug of Pepsi Refresh Project but I may suggest a few things that should be done or given attention to in a situation like this.

• Incorporate the actual product/brand in the campaign. A product’s promotional campaign should obviously be directly correlated to the product and not completely disconnected from it, as it was in the Pepsi Refresh Project. The campaign should feel authentic to everyone participating in it.
• Evaluate the campaign’s performance with the help of various tools and methods so as to ensure that the campaign is bringing in new sales and yielding significant income on the investment made. The main goal of any promotional campaign is to drive sales and that should be the biggest focus. If any shortcomings are found then effective measures should be taken to impact the sales figures positively.
• Binding customer engagement directly with sales by adopting various such techniques. One of those techniques would be what is seen with companies doing promotions such as one product sold means one tree planted or one brick for a school. This gives the customer a sense of direct participation in a great cause. PepsiCo could do something like one bottle of Pepsi means 1 vote or such.
• The focus of the campaign should be on one topic/subject. One loses the core focus if it tries to catch many balls at once. So, the goal should be on a very few, one if possible, relevant and realistic goals.
• Finally, if nothing else works then the project should be dropped. When everything is tried out and no other viable option is left, the company should either find another alternative way to promote their products through the means of digital marketing, or it should go back to traditional advertising in order to come back to digital marketing with improved strategy later.