Failed Product Marketing Assignment- Pepsi AM Product Failure

Maureen

8 months ago

Failed Product Marketing Assignment- Pepsi AM Product Failure

Origin of the Product

One of the phenomenal product failures is the Pepsi A.M. Pepsi Company launched the product purposely to be consumed during breakfast. One of the main reasons for the launch of Pepsi A.M. is that Pepsi was looking to leverage the increasing consumption of soft drinks (CBinsights). At the time, research showed that consumption of soft drinks had increased significantly, with more people drinking soft drinks in the morning. Specifically, the extent of soft drink consumption in the morning had risen to 10%-15% of the overall soft drink consumption throughout the day. To fulfill consumers’ needs, Pepsi incorporated 25% caffeine in the soda, which was intended to ensure that it fulfills customers’ breakfast needs. Although the product initially looked like a wise idea, it did not advance beyond 1990 as it was discontinued.

Although Pepsi was right about the dwindling consumption of coffee, the company largely failed to take account of the market’s consumption traditions. Coffee remains the main breakfast preference for American households, with 40% of the population preferring to consume coffee products during breakfast. Apart from coffee, American households consume juice, which accounts for 20% of products consumed during breakfast. Another top preference for breakfast is milk, followed by the soft drinks segment, which only accounts for 5% of consumption. Therefore, investing in Pepsi A.M. as an alternative breakfast offering was a far-fetched idea that could not stand the test of market preferences. The brand struggled since consumers were not convinced that a soft drink was a good alternative as a breakfast option, which led to the product failing to make significant sales in the market.

Target Market

Pepsi A.M. primarily targeted the breakfast cola drinker, and in this case, the early morning job goers (CBinsights). Firstly, the drink sought to offer convenience for those with limited time to prepare breakfast before they left home for their jobs. Also, including a 25% caffeine boost sought to provide a boost for consumers looking for a product that offers them a sense of alertness and wokeness in the morning. Considering the high level of caffeine incorporated in the product, children were not considered part of the market since the segment does not consume heightened levels of caffeine. The soft drink also targeted non-coffee lovers who would use the drink in the morning to attain alertness. It is worth noting that a segment of the target audience abhors coffee for health-related reasons.

The 4Ps

One area of the marketing mix where Pepsi failed is by failing to ensure adequate promotion of the new product. Promoting a new product is all about letting consumers know that the product exists and devising mechanisms designed to ensure that the product sells (Ehmke et al. 4). To that end, a business should be able to convince buyers that they need a specific product and why they need the product over competitive offers (Ehmke et al. 4). Pepsi largely failed to create a messaging campaign that could convince buyers to go for their product. The company never came up with a specific reason to convince consumers why they needed to go for the caffein-enhanced soft drink over the regular breakfast products. Also, the messaging around the new drink was inconsistent with the company’s marketing standards that portray the image of producing healthy products.

Works Cited

CB insights. “When Corporate Innovation Goes Bad — the 101 Biggest Product Failures of All Time.” CB Insights Research, 25 Sept. 2019, www.cbinsights.com/research/corporate-innovation-product-fails/.

Ehmke, Cole, et al. PURDUE EXTENSION Marketing’s Four P’s: First Steps for New Entrepreneurs. 2005.

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