International marketing ans communications management

Individual assignement

UNIVERSITY OF WESMINSTER – MA IBM

Submission date : 11/01/2022

Submission ID : w18477436

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 EXECUTIVE SUMMARY

This report aims at critically analyzing the Lay’s brand.

It is going to be divided in exactly five chapters, including four chapters dealing with the
brand itself. More specifically, the first one is going to focus on the introduction to the
brand, roughing out the history of the brand while introducing its background and its
current macro environment in the potato crisps and crackers snacks market.

On the other hand, we are going to concentrate more deeply into the brand identity and
essence by firstly highlighting Lay’s features, that is to say the brand’s STP strategy and the
correlation with its marketing mix (place, price, promotion, people, process and physical
evidence), including the ways used by the brand to stand out from its competitors and be the
a top seller on the global market.

The following chapter focus on the essence of the brand, by going though its values, features,
branding strategy and its personalized marketing mix, reflected by the 7P.
Then, we are going to focus on Lay’s international approach and more specifically its
adaptation strategy via the comparison of two countries, which are both promising market
for the brand: China and Mexico. We are going to analyze the main differences between
them in term of marketing strategy and advertisement, since they appear to be two countries
whose culture and tastes are completely opposite. Indeed, this theory is also going to be
discussed according to Hofstede’s and Hall’s theories.

Finally, the last chapter of this report will be delivered as a summary and a conclusion.
It is also going to mention the different limitation in terms of comprehension and coherence
that we had to face during our researches.

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 TABLE OF CONTENT

Executive summary

PART 1) Introduction to Lay’s – Background of the market

A) The brand itself – history and small introduction

B) Background of the market
C) Industry overview and competitors analysis (perceptual map)

PART 2) Features of the brand on the global market

A) Brand identity and values: how does Lay’s want to be portrayed to its customers?
B) Brand BCG Matrix
C) Brand STP strategy: segmenting, targeting and positioning on the market
D) Brand marketing mix – Lay’s 7P
a) Product
b) Price
c) Promotion
d) Place
e) People
f) Process
g) Physical evidence

PART 3) Lay’s international strategy

A) What is the brand’s global adaptation strategy? A study case of 4 different countries
a) Application of the Hofstede’s insights and Hall’s cultural factors
B) The brand communication strategy worldwide – The comparison of China and Mexico

PART 4) Conclusion

References

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PART 1) Introduction to Lay’s – Background of the market

A) The brand itself – history and small introduction

History

Lay’s is one of the most popular and top selling-brand in the North America and worldwide.
It is known as an international leader on the consumer staple product and more precisely on
the potato crisp market, whose products come in a variety of flavors. Indeed, from 1942, the
brand, founded by Herman W. Lay, became one of the first to produce a diversified range of
crips on a large scale, only 10 years after its launch. In the 1950s, Lay’s crips turned to be the
staple snacks for the American families and is nowadays sold in more than 200 different
countries. Firstly created from the merger with a competitors named Fritos in 1961 and
finally generated as a subdivision brand of PepsiCo (a second merger of Pepsi-cola and Frito
Lay), Lays is all at once the name of the brand and the name of the company. More
accurately, Lay’s is one of Frito-Lay brand with Cheetos, Fritos, Tostitos, Chester's, Matador,
Munchos and Doritos.

The PepsiCo’s subsidiary is ranked third in the Product Quality Score, the Pricing Score and
owns one of the most efficient customer service ( according to comparably.com).

Lay’s headquarter are located in Plano, Texas and is globally run by its CEO, Steven Williams.
According to the Frito Lay’s 2021 income statement, it has a total turnover of $ 70.4 billion and
has known a growth of 4% between the years 2020 and 2021.

Branding elements

The Logo:
Memorable Easy to recognize and recall. 72% of the
respondents affirmed that Lay’s was
recognizable as a potato crips brand.
Meaningful It is easy to guess the purpose of the
brand and what flagship product is sold,
only with the graphism of its logo and
the colors used, yellow and red which
embody the brand and symbolize its
dynamism.
Appealing 45% of the consumer qualify the logo as
joyful and as a diffuser of happiness.
Adaptable It has only seamlessly changed over
time with both minor and major stylistic
changes.
Tranferable It can be used is several circumstances
and is kept the same globally.
Protectable Lay’s logo is trademarked, even more
since the brand’s name appears on
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each logo.
The slogan:

Among Lay’s global slogan, the most popular were the following, even if the brand has adapted
its slogan to each targeted country. This is a point we are going to analyze in the third part, (b).

- « Betcha can’t eat just one »

- « No one can eat just one »
- « Lay’s. Get your smile on »
- « Pal Banaye Maaagicalll! »
- « Be a Little Dillogical ».

By choosing these slogan, the brand has opted for a young, catchy and humoristic approach.
Indeed, the brand’s goal was to develop memorable catchphrases, written in slang English
and whose meaning directly address to the young consumers. The brand is effectively using
direct and short sentences which give the feeling that the brand is directly talking to the
consumers, creating a close relationship with each of them and giving them challenges or
advices. Then, the idea around each slogan is mainly focused on the idea of enjoying life, of
happiness and of making each consumer smile at the sight of Lay’s packets.

The packaging:

Over the past 3 years, Lay’s has

operated a lifting of its visual identity in
order to modernize its positioning.
Here, Lay’s aimed at bringing a dynamic
touch while conserving the yellow and
the red colors, which both symbols of
the brand. Although, colors are
differing from a product range/flavor to
another one.
Moreover, it made sure to provide the
customers the totality of the needed
information at the back of its packet,
going from the components, the
nutritional values to the brand’s social
medias, and this presented under a
(Source: Packagingdigest.com) playful way.

The brand name:

Named after the shortcut of its creator’s name (originally H.W.LAY & Company), Lay’s has been
the brand’s name for over 80 years and appears as a key element of the logo. These elements
demonstrate the brand’s authenticity. Lay’s name is furthermore easy to remember, easy to
pronounce and easy to visualize.

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 B) Background of the market

The global potato crisp market remains one of the most promising market in the food industry,
with a value of 31.2 billion of USD in 2020. Besides, the global market value is expected to reach a
total value of 39.8 billion of USD by 2026, despite the uncertain impacts of the Covid-19
pandemic.

Potato crisps embody one of the most popular snack food consumed in the world and is also
perceived as one of the most convenient food option, targeting mainly people with a busy lifestyle
since it enables them to shorten the meal preparation, or at least to complete or replace the meal
time by quick snacks. It also represent a large choice opportunity for its consumers since the
product is available under several declinations: plain, salted, flavored or spicy.

However, the supply chain of potatoes has been highly impacted by the current sanitary situation,
leading to a negative impact on the overall growth of the potato crisp on the market. Indeed, the
exports of dehydrated potatoes has declined of almost 16% and by 13% for the fresh ones in
2020, compared to 2019. Nevertheless, the potato chips market has been able to take advantage
of the situation since it appears that the 2020 outbreak enabled a growth in the consumption of
at-home food, leading to an augmentation of snack products, an particularly of potato chips. As
the demand has inflated, this has also been an opportunity for new private players to emerge on
this market.

Another advantage of the pandemic would be the acceleration towards a digital era, also leading
towards an online way of purchasing which is likely to make the online channels growing at a
faster rate.

Then, the fried and baked potato chips market in mostly led by the United States, India, Canada,
Mexico, Russia and China, even though the USA represents one of the most mature market.
Nevertheless, developing countries and especially western ones are expected to propel the potato
chips market in the coming years, notably via a westernization of the food consumption, via a
growing economy of these countries and a rise/urbanization of the middle class population. This is
also the case of Pacific Asia, which remain a promising market.

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 Figure 1: Potato crisps market share size in % in the world, 2020
(Source: Mordorintelligence.com)

Nonetheless, the rise of health consciousness in the world has led the potato chips
manufacturers to focused on healthier products, including products with less fat, calories,
cholesterol, without GMO and gluten free, plus composed with healthier and more natural
ingredients. Most companies have also invested in R&D in order to launch more diversified
products and consolidate their portfolio.

Figure 2 : Global potato chips market: average expenditure per person per week on crisps
and potato snacks in the United Kingdom from 2012 to 2016.

C) Industry overview and competitors analysis

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The market is divided by the presence of diverse small and large firms which are challenging
in term of quality and prices. It is mostly strengthen by the presence of PepsiCo on the
market, as the company holds most of the market shares, especially via Lay’s. Besides,
PepsiCo’s portfolio appears to have a strong consumers base in each market entered.
The company is then followed by the Kellogg’s which owns Pringles, highly considered as
product for a premium segment in many countries. All of them are competing on the market
in term of flavors innovation, target expansion and reinforcement of the distribution
channels.

Although the list exhaustive, other companies are developing with prominent market shares.
Among these companies, are included: Intersnack, Group GmbH & Co, Miss Vickie’s, Calbee
Inc, The Campbell Soup Company, Kraft Foods, Diamond, Ruffles, Munchos , Red Rock Delhi
(in India) Nestle, General Mills and Orkla. Most of these brands are yet American brands.

Figure 3: Market share of the leading potato chip brands in the United States in 2017, based
on US dollar sales (Source: Statista.com)

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Lay’s perceptual map

Figure 4: Top Selling worldwide potato brands perceptual map, by market share (bubble size), by
variety of flavors and popularity (placement on the map), according to the years 2020 and 2021

PART 2) Features of the brand on the global market

A) Brand identity and values: how does Lay’s want to be portrayed to its customers?

The brand identity can be portrayed via its brand onion, that you will find below.

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àHow does the àHow does the
brand affect the customer look like when
customer? using the brand?
AL
ON
TI
RA

N AL
IO
OT
EM

àHow can the àHow does the

customer best customer feel like
describe the when using the
products/the brand? brand?

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 B) The brand’s BCG matrix

STAR QUESTION MARK

-has a strong financial services strategic -going towards a local foods strategic
business unit +possibility of acquiring business
other firms in the supply chain and
increasing profit. -development of a confectionery
strategic business (growing market)
-development of a new product strategy
since potato crisp is a promising market
and investment in R&D.

-leader on the market + expect to

growth at 5% in the next 5 years (by
reaching out untapped areas)

CASH COW DOG

-strong supplier management service -the plastic bags strategic business

and strategic business unit
-the synthetic fibre products strategic
-the brand’s international food strategic business (market shares <5%)
business (market shares of 35%)
-the artificially flavoured products
strategic business (however, people are
more health conscious and are likely to
consume natural flavors)

C) The brand STP strategy

Segmenting

Lay’s has devoted its marketing strategy to several markets and to broad segments of the
society, which encompass:

- People who are looking for enjoyment in every moment of their life and who want to
experience life with challenges, novelties and changes. In fact, they are people sea-
eking for enjoyment in daily tasks, who have a real interest for moment in family,
home and basic values of life.

- It also targets people who like spending time doing shopping and don’t mind paying a
higher price to get better quality products. They are people who understand the

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 concept of budget. Once they like a product, its price don’t come under
consideration. However, they appear to be a fragile segment, they are not as loyal as
others since they are able to switch from a brand to another one to fulfill their
curiosity.

- However, they are more likely to follow a budget, which explain the fact that they are
more attracted by discount and special deals. Furthermore, this part of the
population tends to try more when they previously try a product via samples, for
example.

- Then, they aim for escaping from their routine life and often choose films, fashion,
celebrities, entertainments and beauty as main “hobbies”. They are also kind of
television.

Targeting

Lay’s target each segment of the society, including every age segments and very gender.
Consequently, it is providing different flavors and tastes to a large group of consumers.

However, the brand has also refined its targeting approach by launching Baked Lays, a range
adapted for health and calorie-conscious customers. Indeed, despite its broad targeting
strategy, Lay’s has yet decided to aim for a younger part of the population to increase its
profit game, and target especially events and entertainments proponents (such as sport
event, including stadium, theaters or cinemas), or people adhering to an at-home lifestyle.

Positioning

The brand targets all the segment of the society, which includes all genders, all ages and all
“incomes”, since everyone in the world is kind of these snacks which appear to be a staple
diet almost everywhere in the world. These wide positioning can be explaining by the fact
that the different flavors offered are a major point of attractiveness for the different
customers and allows everybody to get something they like out of a broad range of choices.
This snack trend first thrived in the USA and spread out in other countries as a new snack for
tea-time. However, the brand has positioned itself as a snack which can be eaten at any time
of the day and focus on the ingredients quality with the slogan “Can’t eat just one”. Lay’s
also widen its positioning by playing on the happiness card with the other slogan “Get your
smile on”, creating a moment of enjoyment for the consumer. Although, the brand’s message
has slightly evolved with the creation of new campaigns focused on enjoying the small
moments of joy.

However, Lay’s hasn’t always targeted such a broad audience. Originally, it was mainly
interested by a younger segment of the population such as the high school and university
students and has expanded it to the adults as well. This range of customers has in common
the fact that there mostly interested in entertainments, sports, events and cinema.
This targeting choice allows the brand to use mass marketing strategies in order to attract a
more important amount of customers.

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 D) The brand marketing mix – the 7P

a) Product

As a potato chips brand, Lay’s flagship product is a trans-fat-free potato crisp declined under
a wide range a flavors, promoted as crispy tidbits. In fact, Lay’s has developed a specific and
personalized range of products according to the location of each outlet in order to be in
correlation with the actual tastes and expectations of the local customers. This is a way for
the brand to harden and expand its client base. However, the brand keeps being innovative
by developing a broader range a products and creating basic and international flavors,
available in most countries. That’s for example the case of the flavor “Indian Masala”, which
after its success in India has been declined around the world, in less spicy or similar versions.
Furthermore, the product’s composition is essentially made out of farm-grown potatoes,
vegetal oil (sunflower, corn and/or canola oil) and salt.

On the other hand, Lay’s potato crisps are kept fresh inside an air-filled packet which enables
to preserve the crispiness of the product and this during a long time (approximatively 2/3
month after the expiration date and 7 days after the first opening of the packet).

By way of example, Lay’s ranges of product are so diversified that it would be impossible to
summarize them in an exhaustive list. However, it is possible to find among its most popular
items, flavors such as:

- Lays Barbecue Flavored Potato Chips

- Lays Chile Limon Flavored Potato Chips
- Lays Classic Potato chips
- Lays Cheddar & Sour Cream Flavored Potato Chips
- Lays Wavy Ranch flavored Potato Chips
- Lays Salt and Vinegar Flavored Potato Chips
- Etc…

Then, Lay’s has developed several versions of its classic potato salted crisp, going from a
“lightly salted” version with 50% less of sodium, the extended ranges of “Lay’s Kettle cooked”
crisps, “Lay’s Poppables”, “Lay’s Gourmet”, “Lay’s Wavy” or “Lay’s Stax” to a new range of
second products such as a new range of dips available in three different flavors (“Creamy
Jalapeno”, “French Onion” and “Smooth Ranch”). Obviously, all these new ranges are
available in more than ten flavors each.

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 Figure 5: Lay’s range of products available on the global market (Source: Lays.com)
For more information and details about the flavors available for each range of product, you can consult the
following link: https://www.lays.com/products

Figure 6 : Lay’s different flavors around the world (Source: Potatopro.com)

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 b) Price

As an international player, Lay’s is using pricing strategies to offer a range of product whom
prices are attractive and discerning. In fact, the brand is basing its pricing strategy according
to its position on the market: its products are easy to access, come in a variety of flavors, are
easy affordable and of high quality. By its pricing strategy, it mainly aims at satisfying the
most price-conscious customers.

Moreover, Lay’s has known to differ from its competitors and retain customers’ loyalty by
setting competitive and up-to-date prices. It uses a promotional pricing plan at regular period
in order to increase its short-term sales volume. More precisely, the brand is using a
promotional pricing system based on the regular basis of its sales volume, which include the
use of incentive bulk deals, price packs and discounts.

As an idea of the prices, Lay’s is currently selling its products from 0.99$ to 4,00$, depending
on the country and the retail facility where the product is sold, its flavor, the range it belongs
to or the size of its packet.

$2.60 $3.02 $3.15

7.75 oz 10.5 oz 13.75 oz

Figure 7: Comparison of Lay’s prices according to the range and the size of the product (Pictures
found on Walmart.com)

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 c) Place

Since Lay’s is a major player at the international scale, its product are available in most
countries of the world. Historically, the brand’s founder, Herman Lay, started snack-food
operation from Dorset in the US, and in the course of time spread out to the rest of the USA
and foreign countries such as: Canada, Australia, Colombia, Brazil, Argentina, Mexico, Egypt,
India, Pakistan, the U.A.E, the United Kingdom and South Africa (Kozinets et al.,2008).
However, there is no specific or designed region for Lay’s to focus on since its products
correspond to the tastes of a major part of the global population.

In addition, the brand has implemented a strong appropriation and distribution channel (of
50 distribution centers), distributing more than 3000 stockiest. It also includes
administrations of makers, wholesalers, services of manufacturers, distributors, retailers who
are directly able to reach the customers via approximatively 1 million retail stores among
which super- and hypermarket, corner shops, bargain shops, general stores, discount stores
and convenience/grocery stores in each country.

The idea here is to enable the customer to access easily and conveniently to the brand’s
products. Besides, Lay’s also has an important inventory network in addition to its retailers
and distributor organization.

Figure 8: Lay’s, a global powerhouse presents in more than 100 countries

(source: designgroupitalia.com)

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 d) Promotion

As a global brand, Lay’s maintains a strong market image and was the first snack food brand
which has been ever marketed on Television.

Lay’s has mainly positioned itself as a brand for young people, with a major portion of
consumers aged between 13 and 26. Therefore, Lay’s has always been working with brand
ambassadors representing the youth in the society and aims for playing the “young brand”
card to their advantage. Moreover, in order to propel the image of a young enthusiast brand,
Lay’s and notably the PepsiCo group made sure to be more popular among sports fans by
sponsoring major sports events such as the UEFA Champion’s League cup, fronted by Lionel
Messi, Lieke Martens and Paul Pogba with a 30 second spot, which is going to be launch in
February 2021.

Then, it is using celebrities as brand ambassadors in order to boost its products and give
them a higher visibility.

However, it has managed to differentiate by using an attractive packaging and diversified

flavors, offers and giveaways, using social media as a direct way of communicating.

The brand is also practicing direct marketing, notably by including free samples for each new
flavor launched, just before the check-out line in the shop and by providing fresh crisps
making machines in some organization canteens (although this method is mainly used in the
USA).

However, the design, brand name, language and flavors used are directly varying according to
the targeted country. This is a point we are going to analyze in the third part (point b).

Figure 9: Lay’s packaging evolution between 2012 and 2020 (Source:

perspectivebranding.com)

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 Figure 10: Example of the different brand’s names and flavors available in the world:
Lay’s in the USA, Sabritas in Mexico, Lay’ in Japan and Walkers in Australia
(Source: perpectivebranding.com)

On the second hand, Lay’s is famous for its innovative, joyful and captivating commercials
(and promotional campaigns in general), which have always been a real asset for it to build a
strong brand image, mainly based on smile, and boost its sales.

Among these promotional international campaigns, the most famous would be the
followings:

The “Do us a flavor” campaign, in July 2012:

This commercial has been a way for the brand to give the customers the possibility to create
their perfect combination of flavors for Lays next range of products, while keeping the core
ingredients not to alter the tastes of the millennial consumers (the main consumer segment).
In this commercial, the brand main objective is not to really change the product conception
but the way people look at it. It was a perfect way for the brand to promote the fact of giving
direct power to the consumers and allow them to directly earn a prize for their participation.

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 Figure 11: the « Do us a flavor campaign”, launched in 2012 (Source: chiefmarketer.com)

The « Real Flavors of Life

campaign”

This campaign underline the

importance of making new
experiences by “living the
magic now”. The brand
wanted to stressed the fact
that every moment can
create emotions, surprise,
memories and anticipation.
This campaign has created
one of the main movement of
Lay’s.

The “Smile Campaign”

Launched on the 4th October

2021, on the World Smile Day,
Lay’s has strategically created this
campaign, which was mainly
targeting India.
Besides, the brand has co-worked
with two Indian ambassadors:
Alia Bhatt and Ranbir Kapoor and
has parallelly launched the TVCs.
For each variant of flavor was
matching a different smile.
For this occasion, personalized Figure 12: the « Smile Campaign », 2021
packs were created for each (Source : Lays.com)
influencer and each flavor.
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The Digital Marketing Campaign Post Covid-19: Heartwork

In this promotional campaign, Lay’s has built its communication from a human angle by
expressing gratitude to the world’s heroes of the pandemic and to each trading partner
involve in the brand’s supply chain, which despite the particular situation of pandemic have
managed to delivers Lay’s product worldwide. This campaign has also been possible thanks to
the contribution of 23 other brands (such as Ariel, Spotify, KFC etc…) and has mainly been
implemented via the hashtag #heartwork on Lay’s Twitter and Instagram’s accounts.

You can find the link of this video on the following link, for the “Heartwork” campaign in
India: https://www.youtube.com/watch?v=hVcvQtsTOS0

Most of the brand campaigns are also directly promoted via all communication methods such
as the Television, the Radio, in Magazines, printed ads and via social medias, online and in
indoor and outdoor cinemas.

e) People

With 55 000 employees, the brand Lay’s involves a large amount of people, from the
product’s conception, its fabrication and distribution to the totality of its life cycle. As an
example, Lays has people working under its sales team (representing around 36% of Lay’s
total workforce) playing a crucial role in the marketing process.

Lay’s also profit of an important retail workforce of 300 000 frontline sales employees
(according to IMB.com).

Moreover, among the stakeholders are the people working in the customer service
department, whose role is to guide customers through the process of resolving issues and
which are trained to satisfy their expectations efficiently.

Then, still as way of example, the company is essentially working with suppliers (32% of the
company’s workforce) whose job is to provide all the necessary raw materials. In fact, these
people are essential in order to maintain or improve the quality of the final products.

Then, comes the staff working at the retails stores, as they emphasize the brand’s face and
essence in front of the customers on site.

f) Process

First of all the brand has implemented different systems in its retails stores for the retailers to
be able to notify the supply department every time the inventory levels are low and replenish
the stocks.

Then, to optimize productivity across its systems and to improve the service for all-sized
retailers, Frito-Lay has centralized and modernized its tools with an efficient salesforce.
Indeed, in order to improve the customer’s satisfaction and fidelity to the brand, Lay’s is

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currently working with IBM services and IBM Salesforce practice, in order to widen its e-
commerce strategy and implement new process to streamline frontline employees’
workflows.

Also, the brand aims at better understanding customers’ needs by getting more involved in
researching market opportunities, notably through feedback directly collected at stores, on
social media pages and via its customer service.

g) Physical evidence

Lay’s factory are present everywhere in the world, with 31 manufacturing plants (across 21
states) and 372 millions of packets sold each year according to the number of 2019, and this
only in North America. Furthermore, it has automated plants in India in 5 different states,
which are all audited and accredited for different criteria in order to increase its production
volume in case of higher volume. Besides, 16 billions of Frito-Lay’s products have been totally
sold in the world, of which approximately 10 billions of Lay’s packets.

Furthermore, Lay’s has been able to get recognized by the customers and differenced from
its competitors, notably thanks to its colorful packaging, its logo, slogan and mostly thanks to
its powerful communication campaigns. The brand’s visibility is effectively improved by its
packaging, which are more identifiable on the retail shelves. Moreover, the products are
placed on special shelves directly provided by the Frito-Lay company, which all have a
different color and design. This is an asset for the brand, especially when the retail stores are
busy.

Thirdly, the brand’s products are available everywhere, online and on-site, even in the
smallest retail ventures and the most rural areas.

Finally, the brand has an online website which thanks to its ease of use allow the customers
to experience a friendly and direct way to purchase online and get different information
about the brand. Customers are able to directly view the products via high quality images
taken from different angles in order to offer a qualitative online experience to each
customers.

PART 3) Lay’s international strategy

E) What is the brand’s global adaptation strategy? A study case of 4 different

countries

As Lay’s is consumed in exactly 216 countries, it has adopted its own international strategy, by
way of a particular adaptation strategy. When its competitors opted for a more common
approach based on translation of the original products and believed that every market is kind
of proper American products with an American identity, Lay’s chose to adapt its products to
the tastes of the local consumer. In order to ensure its global market expansion, Lays has
indeed played the localization card, including the use of an innovative and forward-thinking
marketing strategy adapted to the needs and the expectations of the population.

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The most relevant example of the company’s international approach remains the use of
different customized brand names among its different markets. For instance, Frenchitas in
Argentina, Sabritas in Mexico, Margarita in Colombia, Tapuchips in Israel, Chipsy in Egypt,
Smith’s in Australia, Walkers in the UK and in Ireland and Poca in Vietnam. Obviously, the list
above in non-exhaustive and is a simple example of the brand adaptation strategy.

To go further, we are going to focus on 2 different countries whose location and culture are
completely different from each other: China and Mexico.

a) Application of the Hofstede’s insights and Hall’s cultural factors

Application of the Hofstede’s insights on China

Figure 13 : Application of the six Hofstede’s dimensions on China (Source: Hofstede-insights.com)

Score Level Application to China

Power 80 High relationship between a subordinate and its superior tends to be
distance polarized à No defense against power abuse by superiors.
à Influenced by formal authority and sanctions
-àOptimistic about people’s capacity for leadership and initiative.
Individualism 20 Low Highly collectivist: group interests come before personal ones.
The employee commitment to the organization (but not necessarily
to the people in the organization) is low, although relationships
between colleagues are cooperative for in-groups (and more hostile
for out-groups). Personal relationships are more considered than
tasks and company.
Masculinity 66 High Masculine society, success-oriented.
àsacrifice family and leisure priorities to work (leisure is not
considered as very important.
Uncertainty 30 Low Flexible on laws and rules adherence, according to the actual
avoidance situation.
à Pragmatism is a fact of life.
à comfortable with ambiguity (language full of ambiguous meanings
difficult for Western people to follow).

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 à Adaptable and entrepreneurial.
Long-term 87 High Pragmatic: truth depends on situation, context and time.
orientation à Adaptation of traditions and customs / it is easy to changed
tradition.
à Proponents of saving, thrifting and investing and show
perseverance in achieving results.
Indulgence 24 Low Restrained society: tendance to cynicism and pessimism.
à doesn’t focus on leisure time and control the gratification of its
desires + restrained by social norms.

Application of the Hofstede’s insights on Mexico

Figure 14: Application of the six Hofstede’s dimensions on Mexico (Source: Hofstede-insights.com)

Score Level Application to Mexico

Power 81 High Hierarchical society : hierarchical order in which everybody has a place,
distance without need of justification.
Individualism 30 Low Highly collectivist society : committed to the idea of group for a long time,
gathering the family, the extended family or the extended relationships.
Loyalty is a main value.
à strong relationships where stronger members of the group take
responsibilities for others
à Emotional r employer/employees relationships
Masculinity 69 High Masculine country: highly involved in their professional life and “live for
working”.
Uncertainty 82 High Avoid uncertainty à Maintain rigid codes of belief and behaviour
avoidance à more intolerant of unorthodox behaviour and ideas.

23
 Rules are in the chore of the habits, time is important, people need to be busy
and are hardworking, precise and punctual.
à emotional need for rules.
àless innovation as security is an important element in individual motivation.
Long-term 24 Low As a normative culture, people are concerned in establishing truth à live
orientation according to traditions, have a small propensity to save for the future and
focus on achieving efficient and quick results.
Indulgence 97 High Focus on fulfilling dreams, impulses and desires with a happy, fun and positive
point of view. Big importance to leisure time, act as they want and spend
money as they wish.

Comparison of both countries according to Hofstede’s insights

Figure 15: Application of the six Hofstede’s dimensions on a comparison of China and Mexico
(Source: Hofstede-insights.com)

Application of Hall’s cultural factors for China, a high context culture

Cultural habit Level (context) Explanation

Overtness of messages High China is well-known for its
various proverbs and other
forms of non-overt
messages.
Locus of control and High Failure is owned to the
attribution for failure person who failed.
Use of verbal communicate High More open to the use of
non-verbal communication.
Humor has to be wisely used

24
 (can be offensive
otherwise).
Expression of reaction High People keep their feelings
private and don’t express
their emotions publicly for
freely à expected to be
prudish and discrete.
Cohesion and separation of High Group are defined and
group everybody’s place has an
importance. People have a
strong bond between them.
Commitment to Low People are more interested
relationships by the accomplishment of
tasks than with relationships
(except family ones).
Flexibility of time Low Highly organized country
where time shouldn’t be
wasted.

Application of Hall’s cultural factors for Mexico, a high context country

Cultural habit Level (context) Explanation

Overtness of messages High Is it necessarily to read
between the lines. Mexican
warm and kindness can be
misinterpreted.
Locus of control and Low People are not blamed for
attribution for failure failure, which is taken as a
group responsibility which
can be solved together.
Use of verbal communicate Low Communication is less
formal, less explicit :
decisions are built via face-
to-face interactions and
long-term relationships.
Ideas are shared via a vague
communication.

Expression of reaction High People are more likely to

express their feeling in
public as there are more
spontaneous. Being sensitive
doesn’t mean being
vulnerable.

25
 Cohesion and separation of Low Group are not defined.
group People have a strong links
between them.
Commitment to High Time is invested in
relationships establishing relationships.
Family and relationships are
a priority. Mix of family and
business.
Flexibility of time High Not seen as a constraint.
People are more likely to
take time and be late, in
both private and
professional life.

b) The brand communication strategy worldwide – The comparison of China and Mexico

China - 乐事

American companies often make an essential mistake while entering the Asian, and more
specially the Chinese market: they assume that both Chinese and American are not different
and develop a non-flexible approach based on the American insights. On the other side, China
is often seen as a culturally different and rigid country.

However, Lay’s has been able to develop an opposite strategy by keeping the essence of its
business while adapting its approach to local markets requirements (that is to say considering
the regional variation in taste), even though China only represents 15% of the global market
shares (Statista.com).

Indeed, PepsiCo/Frito-Lay use its competencies on production and distribution and keeps its
keeps its chore products on both Chinese and other foreign markets: the potato crisp.
Nevertheless, the group has been able to adapt its strategy by fitting the local tastes, creating
a variety of new flavors and propelling the launch of an specific line of traditional Chinese
snacks, perfectly mixing with the original potato crisp. Nonetheless, Lay’s had to consider the
regional variation of tastes as they differ from a central to a western Chinese area (like Wuhan
or Sichuan for example). This also includes the choice of sweet or savory flavors.

Then, Lay’s appears to appeal the Chinese market since its products represents quick and
convenient way to eat, enabling a fast snack during the day, as Chinese customers are known
to be strict in term of time management. It represents therefore a gain of time for them.

Lay’s name:

In China, the brand’s name has slightly been changed into “乐事Le shi” which once translated
means “happy things/moments”, creating good associations with a brand and a positive and
emotional connexion with its Chinese audience. It was a way for Lay’s to create a reflexion of

26
its product’s essence: a comfort food used for relaxing moment while being with friends,
partying or while having a self-indulgence moment. This perfectly goes in correlation with the
Chinese proponence to collectivism and commitment to relationships.

Nevertheless, Lay’s had to be careful when choosing its Chinese brand name since the Chinese
language has a large number of homophones: risk of misunderstanding of the Chinese
audience.

Lay’s flavors:

Originally, Lay’s was mostly using foreign and international flavors to enter the Chinese
market, especially western flavors. However it finally started to develop a range of new local
flavors among years and has recently launched a line of product based on Chinese cuisine. In
fact, the brand’s success in China can be mainly explained by its innovative spirit, which also
deal with healthier products like the Chinese yam 山药 chips, purple potato chips, avocado
chips, pumpkin chips or grilled squid crisps.

The brand objective’s here were to match with the Chinese culture’s features such as its
proponence to conserve, renew but also customize traditions. This is the case of Lay’s
Chinese products which are a perfect mix of both American and Chinese cultures (uncertainty
avoidance), even though Western products are only sold as an “Original” line of the brand.

Among the top 9 Chinese favorite flavors are the followings (pictures found on Lays.com):

Lay’s American Classic Lay’s Numb and Spicy Lay’s Italian red meet
Hot Pot

27
 Lay’s Little Tomato Lay’s Hot and Sour Fish Lay’s Lemon Tea
Soup

Lay’s Peking Duck Lay’s Blueberry

Lay’s Cucumber

Lay’s packaging design and packaging size:

As Lay’s logo remains more or less the same in the world, except on light translation changes,
the brand has mainly focused on its packaging, which is designed differently in China.

However, package a more likely to be sold in smaller sizes as they are adapted to the Chinese
eating habits. The average package size is 70g when it is 200 or 175g in Europe. However, the
wrapping size remains the same as the Chinese packet’s size difference comes from a bigger
amount of air inside them. Then, the brand has opted for large packaging, easy for group to
share as it is common in China to share snacks on the workplace and in family.

Concerning the color, Lays has opted for bright and vivid color for its “Original” products as
they are more common for food and beverage food. On the other side, the “Chinese Cuisine”
range is using gold and red colors which are powerful traditional colors, as they both mean
luck and wealth. They are the most used colors by the brand.

28
Then, the label and the typeface have both been adapted to the Chinese market as Lay’s has
adopted a Chinese brand, as well as a translation of it. The brand’s here aims at making the
name’s pronunciation easier to remember and include a Chinese typeface as a part of the
logo.

Then, the pictures and patterns present on the packaging represent an important factor in the
purchasing process. The current trend shows that Chinese are more sensitive to packaging
using environmental friendly material, with a simple and modern design.

Figure 16: Lay’s different packaging in China (Source: Laysaroundtheworld.com)

Lay’s prices

Lay’s products appears to be more expensive in mainland China, particularly in big cities.
Compared to the USA, Lay’s classic 300g packet worth $6.05 in China while costing $4.28 in
North America (Humuch, 2018).

This difference of prices can be explained by the fact that Chinese customers are less
sensitive to the prices, since the price of a package wouldn’t influence their choice of
purchasing or not. This can also be explained by the Chinese’s culture which is less focused
on leisure but more on duties and professional life, eating snacks is such context as events or
breaks is more occasional than in western countries. The snack budget is then less important
in China and people are more likely to consumer expensive items since they eat team
occasionally.

For its pricing strategy, Lay’s has used customer’s perceived value-based, competitive and
cost-based strategies, which allow it to keep a dominant market position while maximizing its
profits.

Lay’s advertisement approach:

Lay’s “Crunchy Sound” challenge

As e-commerce platforms and logistical/distribution infrastructures have increased across

China, consumers are less sensitive to paper-printed ads. For this reason, the brand has
released different challenges on the social medias, among which: the Crunchy Sound
Challenge which drove to the post of 217 000 videos online (you will find its video extract on

29
the following website: https://www.mindshareworld.com/china/work/lays-crunchy-sounds-
challenge)

Social media have been propelled to 36% and represent an asset for the brand. By creating this
challenge, the brand is playing around the sensory signal of sound by making the consumers
craving for its products only by listening to people cracking, munching and crunching.
Played on the tone of humor, this challenge has gone viral in only few weeks.

Then, it is common that the brand co-works with celebrities and influencers as ambassadors in
order to promote their product. Indeed, the brand has involved famous actor in this campaign,
such as Bian Jian, Papi Jiang or Jingting, as well as twenty other popular influencers.
In order to participate, people needed to provide their own audio script while biting into a bag
of Lay’s, leading them to buy a packet.

Lay’s Chinese New Year Campaign: https://youtu.be/kbSVprr3XAY

(Source : Forbes.com)

The brand has launched a special product line for

each symbol of the Chinese new year (such as the
Monkey or the Pork New Year)
(Source : Trendhunter.com) 30
 The entire name of the campaign is
the Lunar New Year campaign (2019)
and was created under the rhythm
of emotional elements such as:
-giving good wishes to the Chinese
consumers
-celebrating in family and sharing a
moment of love and happiness

Then, Lay’s has modified its

packaging with a more modern
edition, surrounded by vibrant and
celebratory graphisms, symbols of
joy, as these holydays embody a
huge part of the Chinese culture.
(Source: Creativityawards.com)

China is a country with a strong culture, but its high score in “long-term orientation” shows
that people are able to adapt and modernize it. Lay’s has played a major card by directly
targeting the chore of Chinese culture since people appear to be sensitive to this cultural
adaptation. It also demonstrates that, despite its low indulgence score, Chinese people also
tend to enjoy small moment of joys by celebrating important events in groups of friends and
family(collectivism).

The brand is also using a billboard methods in Chinese main cities, such as in Beijing like
below:

(Source: Campaignasia.com)
31
This advertisement campaign is not the pure chance. The brand has voluntarily decided to
place it in the tube in order to increase its visibility during a daily life moment: waiting for the
transport. This gives a change for the brand for some minutes when Chinese consumers are
not obviously busy with their professional life (or other possible task). Indeed, they just have
to slightly lift their head and then suddenly get their attention caught by Lay’s billboard,
which is put forwards via warm and tractional Chinese colors (red and yellow), via a product
highlighted in the center of the billboard and underscoring the quality of the new flavor via
illustrations.

As a masculine country, China appears to be a country chose citizen are particularly involved
in their professional and don’t attribute time to leisure (or less), and is also a non-flexible
country, meaning that time is precious and shouldn’t be wasted. Therefore, Lay’s choice of
advertisement perfectly match with the Chinese urban busy lifestyle.

Mexico

Subsidiary of PepsiCo Latin America, Lay’s, called “Sabritas” in Mexico has reached the
country in 1966, owing todays 80% of the Mexican potato-chip market with a total of $1
billion in annual sales.

Some features of the brand are however proper to the Mexican market.

The product itself

Lay’s product in Mexico are represented by a variety of flavors which are inspired by both
Western and Latin cultures. Indeed, even if the flavors seems to be quite basic, they are still
different: the brand offers spicier tastes, assorted to a sachet of hot sauce in each of its
package. Indeed, meals in Mexico are always served with at least one sauce (mostly green
and red chilies) and especially with an assortment of hot flavors for the customer to season
according to his tastes. Sabritas main product remains the potato chips as well, even if the
brand diversified itself with corn-made crisp (the Mexican tortilla), as 35% of the global corn
production is produced in the country. It has also developed a second product: the taco
shells.

Furthermore, the brand also offers local products such as Crujitos, Poffets, Rancheritos and
Sabritones.

However, the total list of its products range is non-exhaustive as Sabritas has expanded its
sphere of activity to savory snacks in general, with products such as: different dips,
Pizzerolas, Turbos Flamas, Chile and Lime Peanuts, Japanese Peanuts, Salt and Lime Peanuts,
Limon, Habanero and Sabritas Chili Piquin. It also includes other brands such as: Poffets,
Karate, Mafer, Nutritas, Sabrimix, Sun Chips, Tacos, Tostitos and Churrumais.

32
 Sabritas’ subsidiary brands: Crujitos, Poffets, Rancheritos and Sabritones
(illustrations found on Mexlatin.net)

The brand’s name

Instead of simply translating or keeping the original brand’s name “Lay’s”, the company has
decided to penetrate the Mexican market via a new name, more familiar to the Mexican
consumers. Indeed, Sabritas is a shortcut of the name “ Sabrosas y Fritas”, meaning “Tasty
and Fried” or “Fried ones”. Sometimes, customers are adding a “papas” before “Sabritas”,
meaning “potato”. However, “Sabritas” is not really a product of Lay’s adaptation strategy
since this name was already existing when the Pepsi-Co has bought the brand out in 1966.

Logo:

Sabritas owns two logo. However the most popular one remains the original logo, that is to say
the yellow sun surrounded by a red ribbon. Then, the brand is yet switching with its proper
logo, which still emphasize the smiling and happy spirit of the brand: a red ribbon placed under
a smiling face. The only thing changing in the original logo is the brand’s name replaced as
“Sabritas” an non as “Lay’s”.

Sabritas’ logos (Source: seeklogo.com)

Packaging:

33
First of all, every bag of Sabritas contains non-wrapped plastic and Tazos (also known as
POGS in the USA), a promotional item distributed especially by the Mexican subsidiary
(containing a score value enabling each players to win other Tazos from other players). This
playful prize make sense as Mexican culture is leading by a strong feminism, that is to say a
bias to enjoy life at every moment and choosing joy moment rather than responsibilities.

In term of conception, Sabritas’ packages are more flexible and larger than usual packets
(family size) that can be found in Western countries as the products are more likely to be
consumed between friends or in family during events, meeting or parties, as much as work as
in daily life. Indeed, Mexican consumers are represented by indulgence, feminism and are
highly committed to their relationships.

However, smaller packets are available as the brand strategy is to provide “small bags in small
shops”) in order to maximize the snack’s ease of purchase and consumption via a specific
product presentation and convenient points of sales.

Concerning the colors chosen, it appears that Mexican customers are averted to dark and
brown colors but kind of warm, saturated and cool colors. Consequently, the brand has opted
for red, firstly representing red chili peppers, a staple of Mexican food and secondly
empowering the color of the Matador in a Mexican bullfights enticing the bull with a red cape
(as it is an old tradition, Sabritas here has decided to play on “traditional card” since Mexican
culture is more likely to avoid uncertainty).

Tastes:

Sabritas is highly influenced by the traditional Mexican cuisine gathering food, music, color,
history, tradition, fragrance and joy if its people.

Its flavors are based on traditional tastes such as vegetables, spicy flavors (jalapenos and chili)
and grilled meat.

The brand most popular flavors are the followings:

34
Sabritas Adobadas (pickled/marinated) Sabritas Limon (Lime) Sabritas Crujiente Jalapeno
Sabritas Original (crispy pepper)

Sabritas Adobadas flavor Sabritas Lemon Flavor Sabritas Crujientes

(pickled/marinated flavor) (Lime) Jalapenos

Sabritas Crema y Sabritas Original

Especias (cream and Sabritas Habanero
condiments) (pepper)

Promotion approach

Sabritas targets a broad audience notably by calling upon brand ambassadors and celebrities
(movie stars, singers, influencers) like Enrique Iglesias, Rayan Reynolds, Neymar or William
Levy.

Then, the brand try to vehiculate, in each of its promotion campaign, the image of happy
people having good time together while enjoying Sabritas products and reflects the active
lifestyle of its consumers. Most of the time, the main idea that today’s population is young and
on the move, eating Sabritas snacks when they don’t have time for formal meals, while adding
a touch of humor and, as Mexican culture implies, of “sex appeal”.

35
 - The « Y tú... qué harías por ellas? » commercial (« And you, what would you do for
them?”)

Link of the commercial :

https://www.google.com/url?sa=t&rct
=j&q=&esrc=s&source=web&cd=&ved
=2ahUKEwiah5GSy6j1AhUMmBQKHd5
0C7MQuAJ6BAgPEAg&url=https%3A%2
F%2Fwww.youtube.com%2Fwatch%3F
v%3DmiAYrD8LZWU&usg=AOvVaw1Zq
bmUFEeOHqBDT8SmyI6q

Figure 17: Extract of the commercial, 2020 (Source: Youtube.com)

According to Hall’s theory, Mexican culture allows people to express themselves in public: they
are spontaneous and are always playing around the game of love, seduction and attraction.
The commercial is also playing with the sounds and the ASMR produced by the chips crispiness.
Indeed, in its scenario, Enrique is peacefully eating its crips when a splendid woman appears
to deviously steal them, despite of his proposition to kiss her, thinking that she is directly
attracted by him.

Spanish is also used as a main language as this is an important part of the Latin culture and
people are more likely to be responsive to the commercial, as Mexican “indulgence” score is
high, which reveals that people are willing to live though impulses and desires fulfillment.
However, as we can see on the commercial, Latin warmness and kindness can sometimes be
misunderstood: people have sometimes to read between the lines.

-The #JoveNazo commercial (2012 ) with William Levy

Link to the commercial:

https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ve
d=2ahUKEwi10dnan6n1AhUBqxoKHevSB98QuAJ6BAgJEAg&url=https%3A%2F%2Fwww.youtu
be.com%2Fwatch%3Fv%3DBK4Wqda_K3U&usg=AOvVaw24dHTNsAgV7uMV5H4ACSLu

(Source: Youtube.com)

36
This commercial plays around the same topic as the first commercial, but put an accent more
humoristic on it. Indeed, it tries to go against conventions and go beyond usual clichés by
reversing this idea of the awesome lifeguard saving the sexy woman in distress. However,
despite being a country with a high power distance, that is to say a strong acceptance and
respect for hierarchical order, the commercial breaks the idea of the strict police forces by
involving a “sexy” policewoman, who is also playing on seduction in order to steal the
package of Lay’s.

The #Irrestistiblementecrujientes campaign (2021), with Rayan Reynolds

Link to the commercial: https://www.youtube.com/watch?v=Y-OQoOTeqQY

(Source: Youtube.com)

As Mexican humor is mainly based on comedies and obvious jokes, it was natural for the brand
to call on the famous actor Rayan Reynolds, which is known for its off-the-wall humor.
The scenario here is based on a marketing meeting between Lay’s marketing and their brand
ambassador, who cannot focus on what they try to explain to him because of the crisps’ high
level of crispiness. It finishes on a funny and silly touch as Rayan ends up being forced to play
the human cannonball in spite of himself.

It perfectly goes in correlation with the Mexican expectations: it doesn’t include puns or
wordplays as it less easy for them to master, especially due to the risk of the translation and
to the low use of verbal communication in Mexican culture.

37
 Conclusion

Present in more than 200 countries, Lay’s has been able to successfully establish at a global
scale by remaining the top leader on the potato crips and savory snacks markets for more than
sixty years, despite the strong competitivity of its environment. Then, the brand global
adaptation strategy has enabled it to meet the customers’ expectations and needs within each
targeted country. Its marketing approach appears to be its main strength and made of it one
of the most, not to say the most popular brand in the world, rhythming the daily life of the
consumers, via its logo, its slogans or its inspiring and diversified commercials.
Then, the essence of Lay’s product, that is to say the high quality of the ingredients, the variety
of flavors offered or the happiness spirit inhering from its promotion campaigns has propelled
the brand popularity among various countries with different cultures, as this is the case in
China and Mexico. Moreover, Lay’s remains competitive since it is offering a fair and relevant
pricing compared to its competitors (mostly America ones). It has also implemented strong and
efficient distribution channels which have enabled the expansion of the brand from large
retailers to small corner shops.

Furthermore, as previously said, Lay’s has been able to create a focused and localized
marketing for each of its markets, going from the introduction of staples product to the
elaboration of a broader range of adapted flavors. All these elements have been featured with
the strong integration of cultural elements among each of its campaign, which is a capital
advantage regarding to its competitors.

To illustrate the brand adaptation, we have decided to focus on Mexico and China, which are
two culturally opposite countries according to Hofstede’s insights and Hall’s theory. Besides,
these differences have been underlined via the brand’s advertisements and commercials, since
it appears that despite both countries tend to be highly collectivist, Mexican culture is based
on indulgence, in contrast with China.

As advices, we believe that the brand should more focus on the current health-concern by
providing more nutritive and healthier products, why not by introducing more natural flavors.

Then, as the brand is already present on the on-site market, it should open up new online
shops version via social media, that is to say selling its products on online shops along with
social media promotion posts, while enabling an easy navigation to its online customers.
However, it should be noted that Lay’s already counts more 300 000 customers directly
resulting from the e-commerce (according to IBM.com).

Finally, it should also stretch out by creating company-operated retail stores which would sell
all its range of products. Therefore, it would be a way for the company to save costs and
erase retailers and wholesalers profit margin.

38
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