Pepsi (PEP) Looks to 'Tweak' Soda Prices and Create More Regular Buyers
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PepsiCo (NYSE: PEP) shares are near intra-session lows Wednesday following reports that the company might "tweak" soda prices to encourage more regular purchases of its products, not just when they're on sale.
Reuters reported that Pepsi is working on a "hybrid everyday value" strategy, which narrows the pricing gap between holidays and regular days. Holiday discounts might be lessened while everyday deals might be more appealing.
Pepsi is testing the strategy out in several markets across the U.S.
At the Beverage Forum conference in New York, Pepsi Americas Beverages CEO Al Carey noted that the industry does half its volume roughly 12 weeks in a year, with the other half coming in the remaining 40 week period. Basically, customers look out for deals, buy up a large quantity, then don't buy again until another sale hits. Flattening that curve could turn into more purchases with mild fluctuations to margins.
Shares of Pepsi are up about 0.2 percent in afternoon trading.
Reuters reported that Pepsi is working on a "hybrid everyday value" strategy, which narrows the pricing gap between holidays and regular days. Holiday discounts might be lessened while everyday deals might be more appealing.
Pepsi is testing the strategy out in several markets across the U.S.
At the Beverage Forum conference in New York, Pepsi Americas Beverages CEO Al Carey noted that the industry does half its volume roughly 12 weeks in a year, with the other half coming in the remaining 40 week period. Basically, customers look out for deals, buy up a large quantity, then don't buy again until another sale hits. Flattening that curve could turn into more purchases with mild fluctuations to margins.
Shares of Pepsi are up about 0.2 percent in afternoon trading.
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