Elizabeth McUne
MKT/421
December 16, 2013
Creig Foster
Environmental Factors Paper
Introduction
This paper will discuss the environmental factors that PepsiCo faces. These factors effect both the domestic, and global marketing the company does. Factors such as trade practices, demographics, cultural differences, and the Foreign Corrupt Practices Act of 1977 will all be discussed, as well as other factors that affect PepsiCo, and their marketing decisions.
Trade Practices and Agreements An environmental factor is an identifiable element to the physical, cultural, demographic, economic, political, regulatory, or technological environment that effects the survival, operations …show more content…
One strategy will not blanket every country a product is marketed in, especially in the case of PepsiCo; operating in over 200 countries. It is important that the cultural differences are considered for the target group in each market, if they are not the strategy will not work, or could backfire completely. Not considering the cultural diversity of the counties PepsiCo operates in could be costly and embarrassing for the company. Considering these differences can alter product color, packaging, advertisement, and many other …show more content…
Exporting goods and services is one of the simplest ways to enter a market, but relying on that means paying tariffs. Other options of entering a foreign market include licensing, contract management, and joint ownership. The advantages and disadvantages of each option must be weighed before a decision is made. Some countries, like Mexico, offer the option of a joint venture. A joint venture option is one of the best because it gives the company a contact in the market they are entering, making it easier to sell and market their products the way they want to. The politics of a country and the relation of a country to the United States can make entering a market more difficult. Sour relations can mean higher tariffs, or even banning products. Politics might mean regulation that isn’t standard for a company based in the United States. The United States government enacted the Foreign Corrupt Practices Act of 1977 to assist with the unethical, and political options that were available in foreign countries that are not considered in the United States. The Act addresses the issue of bribery and mandates it as an illegal business transaction. The Act was a response to over 400 companies admitting to questionable payments being made to foreign officials to obtain or sustain business in their