Pepsi refresh case study

Submit a three-page written case analysis (.doc, .docx, or .pdf format, single-spaced) to address the following questions:

Should the Pepsi brand team continue to fund the Pepsi Refresh Project in 2011? Why or Why not?

Is the Pepsi brand team focused on the right metrics to measure success? What is the value of consumer engagement? How should they calculate the value of Facebook fans, Twitter followers etc.?

Do you agree with Pepsi’s decision to not advertise during the 2010 Super Bowl? Should they advertise the project on the 2011 Super Bowl?

Is Pepsi the right brand for a cause marketing program like the Pepsi Refresh Project? Why or why not?

For the exclusive use of Y. Paramitha, 2018. 9 - 51 2 - 0 1 8 REV: AUGUST 26, 2013 MICHAEL I. NORTON JILL AVERY The Pepsi Refresh Project: A Thirst for Change Ana Maria “Ami” Irazabal grabbed a Pepsi from the soda fountain in the hallway while dashing to her meeting. She needed a caffeine boost to keep with the pace of her job as the senior marketing director for Trademark Pepsi and the leader of the company’s Social Good program, the Pepsi Refresh Project. It was December 2010, and the project was finishing its first year. In 2009, Pepsi had announced that it would not run advertising for its trademark brands during the 2010 Super Bowl. Instead, the company diverted $20 million—its typical Super Bowl budget—to support grants for a cause marketing program. The Pepsi Refresh Project allowed people to submit ideas for grants to “refresh” their communities. Grants were awarded to ideas that generated the most votes. Consumer response to the program was tremendous. More consumers submitted ideas to the Pepsi Refresh Project than auditioned for American Idol; more votes were cast for Pepsi Refresh projects than in the previous U.S. presidential election. At the same time, Pepsi sales were slumping in the U.S.—down 5% in 2010—and PepsiCo was losing market share to its rival, Coca-Cola.1 For the first time in 20 years, Pepsi-Cola surrendered its title as the second best-selling carbonated beverage to Coke by slipping to third, behind Diet Coke.2 PepsiCo’s share price was also down 5% in 2010.3 Irazabal sat down with her brand team to plan their strategy for 2011. Two questions loomed: Should Pepsi continue to invest in the Pepsi Refresh Project? And, if so, how should the team tweak the marketing strategy and execution to use the project’s success to drive Pepsi sales? The History of the Pepsi Brand Brand Pepsi was owned and managed by PepsiCo, a global consumer products company that managed a diverse portfolio of snack food, beverage, and food brands—including Fritos, Doritos, Lay’s, Gatorade, Tropicana, Sobe Waters, Aquafina, 7-Up, Mountain Dew, Quaker Oats, Cap’n Crunch, Rice-a-Roni, and Aunt Jemima. In 2010, Pepsi was one of the world’s most valuable brands. Its brand equity was valued at over $14 billion, and it ranked 23rd on the Interbrand ranking of the best global brands.4 The Pepsi brand had a long history, originating in 1898 as a hand-mixed carbonated creation developed to delight the crowds at Caleb Bradham’s North Carolina pharmacy. The original Pepsi-Cola drink was joined by Diet Pepsi, a low-calorie drink launched in 1964, and Pepsi MAX, a zero-calorie, sugar-free cola with double the amount of caffeine launched in 2007, to form the Trademark Pepsi brand family. ________________________________________________________________________________________________________________ Professors Michael I. Norton and Jill Avery (Simmons School of Management) prepared this case. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2011, 2013 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-5457685, write Harvard Business School Publishing, Boston, MA 02163, or go to www.hbsp.harvard.edu/educators. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School.