Lead Story

Swinging wildly between splurging and skimping, has PepsiCo India lost its way?

Over the past decade, the company has been losing or barely holding on to its market share in various categories 

|
Published 8 months ago on Oct 23, 2020 20 minutes Read
Shutterstock

August, 2014: A bunch of curious people watched Sachin Tendulkar quietly make his way through the lobby of the Taj Mansingh. The master blaster made brief stops to oblige fans with a picture or an autograph.

In one of the suites above, Indra Nooyi sat with members of her India team. As Chairman and CEO of PepsiCo, she had flown down for the 25th anniversary of the India business. A grand party would take place later that evening, though that was not really on her mind. The priority was to focus on a new idea, which had intrigued Nooyi, and Tendulkar was there with his confidantes to discuss the finer points. It had been less than a year since the cricketer had called it a day, but his popularity had remained intact, and Nooyi was aware of it.

The meeting started post lunch and it went on for a good two hours. For about a year, Tendulkar and his team had drawn up the idea of a milk-based protein fortified drink. PepsiCo India would launch the product with Tendulkar backing it. Nooyi listened intently and she was smitten by the proposition. At the end of the discussion, she delivered her verdict: “Let’s do it.” A month later Tendulkar was in the US to sign the formal agreement with Nooyi and the plan was to be in the market with Oats+Milk over the next year.

Narrating the story, a former PepsiCo official makes his disapproval of the whole deal apparent. He says all of this was being planned few months after the company reported a terrible year – it was deep in the red in FY14, with loss of Rs.2.8 billion. “To get into a new business in a really bad year did not seem like the right thing to do,” he says. 

It could be argued exactly the other way – that a crisis is the best time to look at a new direction, and the local lead

unsub

You don’t want to be left behind. Do you?

Our work is exclusively for discerning readers. To read our edgy stories and access our archives, you’ve to subscribe