PepsiCo to intensify innovation

PepsiCo is to increase advertising and new product extensions for its 12 biggest brands including Pepsi and Walkers this year after recent marketing initiatives helped lift quarterly global sales.

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PepsiCo says it has “an ambitious schedule of exciting marketing activity” for its Pepsi brand.

A raft of marketing activity is being prepped for the coming months with the business focusing more on promoting premium snacking occasions for brands including Doritos and Tropicana. Additionally, the company says it aims to increase spend around product development.

It expects advertising and marketing spend to comprise of at least 5.7 per cent of sales, matching its 2012 investment. The investment follows a year in which the snacks maker cut costs and spent more than $500m (£327m) on marketing its biggest brands.

Indra Nooyi, PepsiCo chairman and chief executive says the “strong start 2013” has been driven by “making higher investments in marketing and innovation”. Since the turn of the year, PepsiCo has unveiled several initiatives including Doritos’ first global campaign and the launch of a new TigerNuts snack for its Walkers brand.

She adds: “Our investment in creating the portfolio are paying off and our brand and innovation strategies are driving sustainable top-line growth. We are driving increased marketplace execution and making higher investments in marketing and innovation to drive future growth.”

PepsiCo, which is set to appoint its new chief marketing officer in the coming months, is accelerating the activity for its flagship Pepsi brand through what it claims is “an ambitious schedule of exciting marketing activity”. It is hoped the activity can further drive beverage sales after the brand recorded stronger sales increase than rival Coca-Cola in the UK last year, according to the latest Britvic Soft Drinks report.

The company reported a 1 per cent rise in global sales to $12.58bn (£8.23bn) for the three months to 23 March as volume gains across its snacks (4 per cent) and beverages (3 per cent) divisions during the same period revealed it is making progress on its ‘marketing reset’ effort.

Nooyi expects the company’s global sales to continue into its next quarter as the impact of brand building initiatives such as Pepsi’s bid to establish a unified brand look across all touchpoints from its in-store marketing through to packaging start to take effect.

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