Final Project

Ryan Brissey, Tevin McCoy, Sarah Snider,

● Pepsi Flavored Drink, with 28% more caffeine than traditional Pepsi

● Originally launched in August 1989

● Discontinued in August of 1990 due to lack of success in level of sales

● PepsiCo launched this product in multiple regions of the United States

● Used the Slogan “Pepsi in the Morning” (AP News)

● Failed due to lack of interest in drinking fizzy drinks in the morning

● The energy drink market from 1990 to 2021 is a completely different market

● 170% annual growth each year in Energy Drink market since 1997 (Nutrition

BioMedCentral)
Could Pepsi AM be revived?

● Pepsi AM failed partly due to lack of interest in consuming fizzy drinks in the

morning

● How would a fizzy energy drink perform in the market today?

● Let’s take a look…...

9.5mg Caffeine / Oz

2020 Sales : $2.89 Billion

10mg Caffeine / Oz

2020 Sales : $1.76 Billion

18.75mg Caffeine / Oz

2020 Sales : $780 Million

● The short answer is Yes!

● Pepsi AM would need a thought out marketing strategy in order to promote the

product into a success

● Pepsi AM would need a few changes to the product, to better set up for success
What changes are needed?

● One reason Pepsi AM failed, was the name

● Adding “AM” in the product name dictates the time frame on when the

customer should use this product, furthermore narrowing their market

● Pepsi AM will now go by

simply….Pepsi Energy
What changes are needed?

● In order to compete with other energy drinks on the market, Pepsi Energy

would need to see an increase in their level of caffeine per fluid ounce
What changes are needed?
Solution!

● As seen in the graph, Pepsi AM contained 4.2 mg of caffeine per oz, a total of

50 mg per 12 oz can

● We would like to increase that amount to 120mg, to be on par with that of Red

Bull’s and Monster Energy’s composition of about 10 mg / Oz

● PepsiCo, being the large company it is, has a massive amount of money directly

allocated to marketing and advertising their products

● Their budget sits at $1.75 Billion annually (Statista)

● This allows for a nice sense of financial freedom in regard to flexibility in

marketing and advertising plans

● Based on research, the majority of energy drink customers are ages 18-49

(Statista)

● Given the age range, we would like to hone in on adults 18-49, with a

specialization in existing Pepsi Cola customers

● Since our age range for Pepsi Energy is 18-49, social media will be huge for

getting our Pepsi Energy traction in the market

● The goal of using social media is to promote our product onto a platform that

has segmented our targeted audience very well

● TikTok has a broad variety of users, however 74% of all users fall into the 18-

49 age range (Backlinko)

● TikTok has a variety of Ad’s they run on their platform, with the costs being

similar across the board

● TikTok charges $10 per 1000 views for an Advertisement (FanBytes)

● TikTok has a whopping 1 billion users on their platform (Backlinko)

● Assuming we wanted everyone to see our advertisement once, it would cost

$10 Million
How often do we need to Advertise?

● In regards to the psychology of marketing, the Marketing Rule of 7 provides

some clarity on the necessary frequency of our campaign

● The Marketing Rule of 7 states that “a potential customer must see a message...7

times before they’ll be provoked to take action” (Marketing Illumination)

● With the Rule of 7 in mind, we would like each user to see our advertisement

around 7 times, meaning that it would now cost about $70 Million
Additional Advertising Efforts

● In addition to advertising Pepsi Energy on TikTok, using traditional billboards

could be advantageous for the product launch

● Let’s take a look at a possible billboard design

● The Average Billboard in a metropolitan area, costs about $10,000 / month

(Statista)

● With this information in mind, having 10 billboards in the largest major city in

each state, for a span of 6 months, it would total up to $30 million dollars
Impact on PepsiCo Marketing Budget

● With PepsiCo’s massive $1.75 Billion budget (Statista), $70 Million on

TikTok, in addition to $30 Million on billboards would carry just 6% of their

annual allowance, making it more than reasonable

1. After hearing our presentation, would you purchase Pepsi Energy today? Why or why not?
2. Do you guys agree with changing the name from Pepsi AM to Pepsi Energy? And do you think
this will increase our sales?
3. Do you think adding a Pepsi product to the energy drink market will give other well-known
energy drinks competition? Why or why not?
4. Is there anything you guys think we could have done differently for the relaunch of our product?
5. Any other questions?
Sources Cited Pt. 1

The 3 secrets to running paid ads on TikTok that convert. Fanbytes. Fontinelle, A. (2021, September 28). The jolting rise of the Energy Drinks
(2021, November 25). Retrieved November 28, 2021, from Industry. Investopedia. Retrieved November 28, 2021, from
https://fanbytes.co.uk/paid-ads-on-tiktok/. https://www.investopedia.com/articles/investing/022315/energy-drinks-
industry.asp.
Associated Press. (1990, October 15). They're not waking up to Pepsi
am, soft drink maker finds. AP NEWS. Retrieved November 28, Kaatz, J. (2021, November 8). Marketing rule of 7's. HoustonMarketing.
Retrieved November 28, 2021, from
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https://apnews.com/e9290d650c83dfb9f4500468640b89c9.
Kunst, A. (2019, September 3). Consumers of energy drinks in 2018, by
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Energy Drinks Market (2021 - 2026): Industry Share, growth 2021 to usa/.
2026 - Mordor intelligence. Energy Drinks Market (2021 - 2026) | Los Angeles Times. (1989, October 2). Pepsi to test formula with extra
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Sources Cited Pt. 2

Nuss, T., Morley, B., Scully, M., & Wakefield, M. (2021, July 5). Energy drink Published by Jan Conway, & 13, O. (2021, October 13). Energy drink
consumption among Australian adolescents associated with a cluster of sales. Statista. Retrieved November 28, 2021, from
unhealthy dietary behaviours and short sleep duration. Nutrition Journal. https://www.statista.com/statistics/558022/us-energy-drink-sales/.
Retrieved November 28, 2021, from
https://nutritionj.biomedcentral.com/articles/10.1186/s12937-021-00719-z.
Published by Statista Research Department, & 3, N. (2021, November
3). PepsiCo: AD spend in the U.S. 2020. Statista. Retrieved
Pepsi A.M. The Soda Wiki. (n.d.). Retrieved November 28, 2021, from
November 28, 2021, from
https://the-soda.fandom.com/wiki/Pepsi_A.M.
https://www.statista.com/statistics/585833/pepsico-ad-spend-usa/#:~
Pepsi am gets pulled from shelves after a brief test marketing phase. The
:text=2014%2D2020&text=In%202020%2C%20PepsiCo
W1nners' Club - Satirical Workplace Website and Ecommerce Store. (2019,
%20invested%201.74,of%20around%20240%20million%20dollars.
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