Pepsi 2005 Annual Report Download - page 13

11
Hundreds of innovations help drive our growth in international markets. Pepsi Cino, the
first cola-coffee flavor combination from a major beverage company, was a dynamic new entry
to the carbonated soft drink arena. 7UP H2O, a sugar-free sparkling water infused with the
flavor of 7UP, was launched in Argentina and proved highly appealing to consumers interest-
ed in lighter beverages. In China, the relaunch and expansion of Gatorade helped us capture
a solid position in the growing sports drink category. And we expanded Tropicana in Europe,
Asia and the Middle East.
Capturing Consumer Attention with Packaging
Packaging captures attention and gives us an opportunity to tell consumers about our brands.
For example, Lipton Original received a makeover. It’s now in 16-ounce glass bottles that
include a logo noting the brand’s naturally protective antioxidants. We introduced new
striking black and silver graphics to highlight reformulated Pepsi ONE.
SoBe Beverages celebrated its tenth anniversary by unveiling new graphics for the entire
20-ounce product line, scheduled to be on the shelves in 2006. The Tropicana Light ’n
Healthy packaging was the first juice beverages to carry Weight Watchers’ proprietary POINTS
values on the packaging.
Outside the United States, one highlight of our packaging innovation was a new 7UP
plastic bottle with a distinctive, proprietary shape that features bold graphics and is
attracting lots of attention on store shelves.
Promotions that Keep Our Brands Top of Mind
Pepsi-Cola used music to help keep our brands top of mind. The Pepsi iTunes giveaway
offered 200 million free songs. In mid-year, Pepsi and Yahoo! announced a partnership to
bring music to fans with “Smash on Yahoo! Music,” an adaptation of the “Pepsi Smash”
summer concert TV program.
With “Call Upon Yoda,” an instant-win sweepstakes, Pepsi-Cola took advantage of the
release of the highly anticipated movie “Star Wars: Episode III, Revenge of the Sith.”
Frito-Lay joined by launching Star Wars-inspired Twisted Cheetos snacks, which temporarily
turned the color of consumers’ tongues into “Yoda Green” or “Darth Vader Dark.”
Pepsi was back with our “Go Pro” sweepstakes, a sports fan’s fantasy that offered the
chance to win trips to select professional sporting events across the country. Then Pepsi turned
up the volume even higher with its highly successful Mountain Dew promotion that gave away
an Xbox 360 next-generation video game and entertainment system every ten minutes.
Mountain Dew made news with Mountain Dew (MD) Films and Universal Pictures joint
release of “First Descent,” the story of the rise of snowboarding. Our SoBe business
kept the action going all year with concert tours, support of major surfing events,
supercross/motocross racing and skateboarding — activities that reflect active lives of
“Team Lizard” fans. Gatorade gave its brands local visibility through the Gatorade Athlete
of the Year award program which recognizes young athletes.
Non-Carbonated
Soft Drinks
35%
Carbonated Soft Drinks
65%
PepsiCo Beverages North
America Carbonated Soft Drink
Volume vs. Non-Carbonated Soft
Drink Volume
Carbonated soft drinks generate
the largest volumes.
Non-Carbonated
Soft Drinks
67%
Carbonated
Soft Drinks
33%
PepsiCo Beverages North
America Carbonated Soft Drink
Revenue vs. Non-Carbonated
Soft Drink Revenue
Non-carbonated soft drinks generate
the largest revenue.
Other
20%
PepsiCo
26%
Private Label
14%
Cadbury
Schweppes
10%
Nestlé
6%
Coca-Cola
24%
U.S. Liquid Refreshment Beverage
Market Share
% Volume in Measured Channels
PepsiCo has the leading share of the
liquid refreshment beverage market.