3/02/2005

PepsiCo and Obesity

PepsiCo is taking an interesting approach to the Obesity lawsuit craze. (http://www.msnbc.msn.com/id/7067184/) Pepsi is trying to be proactive in protecting itself from the obesity lawsuit age that we live in. Will trying to steer its adds away from kids have a positive or negative effect on demand? I think that demand won't be changed a whole lot. PepsiCo has already made inroads with parents so steering advertising away from kids will most likely be very inelastic because brand loyal parents already introduce pepsi products to their kids.

4 comments:

Jones said...

I agree that steering Pepsi's ads away from children will not have an effect on demand immediately. Maybe it will in the long run, but every child already knows about Coke and Pepsi from their parents. Pepsi is offered at schools and every fast food place. No matter what Pepsi decides to do with their ad campaigns, they are going to have an impact on children no matter what.

Keston said...

I also agree that Pepsi’s new marketing strategy will not hurt them or affect their demand. I don’t think it will really matter to kids whether Pepsi is advertising towards them or not. They are going to drink Pepsi because of the taste or because their friends are drinking it, not because they are being marketed too. I don’t think most kids even pay attention to that. So overall, I don’t think this will cause the demand for Pepsi to change.

Harry said...

I also would have to agree that steering ads away from children will not stop the obesity problems. I don't care who you are everyone knows about pepsi, and parents will still buy it for theirselves.

Dr. Tufte said...

-2 on Ron's post for a poorly formatted link and grammatical errors.

I think the post said it best - Pepsico is trying to be proactive about the potential for lawsuits and regulatory damage.

My guess is that this won't effect them that much. There is a lot of evidence that advertising increases revenue, but very little that it increases profits.