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COCA-COLA
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Fig 2.1 SWOT ANALYSIS OF COCA-COLA
STRENGTHES:
WORLDS LEADING BRAND
Coca-Cola has strong brand recognition across the globe. The company has a leading brand
value and a strong brand portfolio. Business-Week and Inter-brand, a branding consultancy,
recognize. Coca-Cola as one of the leading brands in their top 100 global brands ranking in
2006.The Business Week-Inter-brand valued Coca-Cola at $67,000 million in 2006. CocaCola ranks well ahead of its close competitor Pepsi which has a ranking of 22 having a brand
value of $12,690 million Furthermore; Coca-Cola owns a large portfolio of product brands.
The company owns four of the top five soft drink brands in the world: Coca-Cola, Diet Coke,
Sprite and Fanta.
Strong brands allow the company to introduce brand extensions such as Vanilla Coke, Cherry
Coke and Coke with Lemon. Over the years, the company has made large investments in
brand promotions. Consequently, Coca-cola is one of the best recognized global brands. The
companys strong brand value facilitates customer recall and allows Coca-Cola to penetrate
new markets and consolidate existing ones.
During the same period, revenues from East, South Asia, and Pacific Rim grew by 10.6%
while revenues from the bottling investments segment by 19.9%.
Together, the three segments of Latin America, East, South Asia and Pacific Rim
bottling investments, accounted for 34.8% of total revenues during fiscal 2006. Robust
revenues growth rates in these segments contributed to top-line growth for Coca-Cola during
2006.
WEAKNESS:
NEGATIVE PUBLICITY
The Coca-Cola Company has been involved in a number of controversies and lawsuits related
to its relationship with human rights violations and other perceived unethical practices. There
have been continuing criticisms regarding the Coca-Cola Company's relation to the Middle
East and U.S. foreign policy. The company received negative publicity in India during
September 2006.The company was accused by the Centre for Science and Environment
(CSE) of selling products containing pesticide residues. Coca-Cola products sold in and
around the Indian national capital region contained a hazardous pesticide residue.
On 10 December 2008, the US Food and Drug Administration (FDA) wrote to Mr. Muhtar
Kent, President and Chief Executive Officer, to warn him that the FDA had concluded that
Coca-Cola's product Diet Coke Plus 20 FL OZ was is in violation of the Federal Food, Drug,
and Cosmetic Act.
In January 2009, the US consumer group the Centre for Science in the Public Interest filed a
class-action lawsuit against Coca-Cola. The lawsuit was in regards to claims made, along
with the company's flavours, of Vitamin Water. Claims say that the 33 grams of sugar are
more harmful than the vitamins and other additives are helpful.
Coca-Colas performance in North America was far from robust. North America is CocaColas core market generating about 30% of total revenues during fiscal 2006. Therefore, a
strong performance in North America is important for the company.
In North America the sale of unit cases did not record any growth. Unit case retail volume in
North America decreased 1% primarily due to weak sparkling beverage trends in the second
half of 2006 and decline in the warehouse-delivered water and juice businesses. Moreover,
the company also expects performance in North America to be weak during 2007. Sluggish
performance in North America could impact the companys future growth prospects and
prevent Coca-Cola from recording a more robust top-line growth.
OPPORTUNITIES:
ACQUISITIONS
During 2006, its acquisitions included Kerry Beverages, (KBL), which was subsequently,
reappointed Coca-Cola China Industries (CCCIL). Coca-Cola acquired a controlling
shareholding in KBL, its bottling joint venture with the Kerry Group, in Hong Kong.
The acquisition extended Coca-Colas control over manufacturing and distribution joint
ventures in nine Chinese provinces.
In Germany the company acquired Apollinaris which sells sparkling and still mineral water.
Coca-Cola has also acquired a 100% interest in TJC Holdings, a bottling company in South
Africa. Coca-Cola also made acquisitions in Australia and New Zealand during 2006. These
acquisitions strengthened Coca-Colas international operations.
These also give Coca- Cola an opportunity for growth, through new product launch or greater
penetration of existing markets. Stronger international operations increase the companys
capacity to penetrate international markets and also gives it an opportunity to diversity its
revenue stream. On 25 February 2010, Coco cola confirms to acquire the Coca cola
enterprises (CCE) one the biggest bottler in North America. This strategy of coca cola
strengthens its operations internationally.
The US Census estimates that by 2020, the Hispanic population will reach 60 million or
almost 18% of the total US population. The economic influence of Hispanics is growing even
faster than their population. Nielsen Media Research estimates that the buying power of
Hispanics will exceed $1 trillion by 2008- a 55% increase over 2003 levels.
Coca-Cola has extensive operations and an extensive product portfolio in the US. The
company can benefit from an expanding Hispanic population in the US, which would
translate into higher consumption of Coca-Cola products and higher revenues for the
company.
THREATS:
INTENSE COMPETITION
Coca-Cola competes in the non-alcoholic beverages segment of the commercial beverages
industry. The company faces intense competition in various markets from regional as well as
global players. Also, the company faces competition from various non-alcoholic sparkling
beverages including juices and nectars and fruit drinks. In many of the countries in which
Coca-Cola operates, including the US, PepsiCo is one of the companys primary competitors.
Other significant competitors include Nestle, Cadbury Schweppes, Groupe DANONE and
Kraft Foods.
Competitive factors impacting the companys business include pricing, advertising, sales
promotion programs, product innovation, and brand and trademark development and
protection. Intense competition could impact Coca-Colas market share and revenue growth
rates.
companys interests. In addition, many of its bottling partners have the right to manufacture
or distribute their own products or certain products of other beverage companies.
If Coca-Cola is unable to provide an appropriate mix of incentives to its bottling partners,
then the partners may take actions that, while maximizing their own short-term profits, may
be detrimental to Coca-Cola. These bottlers may devote more resources to business
opportunities or products other than those beneficial for Coca-Cola. Such actions could, in
the long run, have an adverse effect on Coca-Colas profitability.
In addition, loss of one or more of its major customers by any one of its major bottling
partners could indirectly affect Coca-Colas business results. Such dependence on third
parties is a weak link in Coca-Colas operations and increases the companys business risks.
RESEARCH
METHODOLOGY
The main objective of the project is to analyze and study in efficient way the current
position of Coca- Cola Company.
To perform PESTLE and SWOT analysis of Coca-cola globally as well as locally.
This would help us identify areas of potential growth.
The study was aimed to perform Market Analysis of Coca-Cola Company & find out
different factors effecting the growth of Coca-Cola.
Another objective of the study was to perform Competitive analysis between CocaCola and its competitors.
To understand the reasons behind the purchase of Coca-Cola products.
SCOPE OF THE STUDY:This study basically tries to discover the current position of Coca-cola in the market. It
also tries to discover the preferences of the customers when posed with a choice between
Coca-Cola and Pepsi. It is primarily directed to the general public but was done only in
North delhi,
RESEARCH DESIGN
A research design is the specification of methods and procedures for acquiring the needed
information. It is overall operational pattern or framework of the project that stipulates what
information is to be collected from which source by what procedure.
There are three types of objectives in a marketing research project:
Exploratory Research.
Descriptive Research.
Casual Research.
1. Exploratory Research:The objective of exploratory research is to gather preliminary information that will help
define problems and suggest hypothesis.
2. Descriptive Research:The objective of descriptive research is to describe things, such as the market potential for
a product or the demographics and attitudes of consumers who buy the product.
3. Casual Research:The objective of casual research is to test hypothesis about casual and effect relationships.
Based on the above definitions it can be established that this study is a Descriptive Research
as the attitudes of the customers who buy the products have been stated. Through this study
we are trying to analyze the various factors that may be responsible for the preference of
Coca-Cola products.
SOURCES OF DATA
The data has been collected from both primary as well as secondary sources.
SECONDARY DATA:It is defined as the data collected earlier for a purpose other than one currently being pursued.
As a researcher I have scanned lot of sources to get an access to secondary data which have
formed a reference base to compare the research findings. Secondary data in this study has
provided an insight and forms an outline for the core objectives established.
The various sources of secondary data used for this study are:
News papers.
Magazines.
Text books.
Marketing reports of the company.
Internet.
PRIMARY DATA:The primary data has been collected simultaneously along with secondary data for
meeting the established objectives to provide the solution for the problem identified in
this study.
The methods that have been used to collect the primary data are: Questionnaire.
Personal Interview.
Questionnaire.
Personal interview.
Tables.
Percentages.
Pie-charts.
Bar-charts.
Column charts.
SAMPLING DESIGN
An integral component of a research design is the sampling plan. Especially it addresses three
questions: Whom to survey (sample Unit), how many to survey (Sample Size) and how to
select them (sampling Procedure). Making the census study of the entire universe will be
impossible on the account of limitations of time and money. Hence sampling becomes
inevitable. A sample is only his portion of population. Properly done, sampling produces
representative data of the entire population.
LIMITATIONS OF THE STUDY:The main purpose of this study is get idea about the preference of the customers towards
various Coca-Cola products. But there are certain factors which affects this study they are as
follow:
Since the sampling procedure was judgmental, the sample selected may not be true
representative of the population.
Economic and market conditions are very unpredictable (Present and future).
The project duration is limited to 4 weeks so it limits the area of study.
The study was confined to North delhi, Noida and due to which the result cannot be
applied universally.
DATA ANALYSIS
Fig 2.4
Male
63%
Female
Fig 2.5
Fig 2.6
50-100
4%3%
100-150
150-200
81%
Above 200
Fig 2.7
Fig 2.8
Parties
Cinemas
Picnics
Festivals
0
20
40
60
80
100
120
Number of respondents
Fig 2.9
20
10
0
Fig 2.10
20
40
60
80
100
120
NO. OF RESPONDENTS
Fig 2.11
Fruit drinks
20%
Energy drinks
Alcoholic drinks
14%
27%
40%
Fig 2.12
Quantity preference
90
80
70
60
50
40
30
Number of responses
20
10
0
Fig 2.13
QUANTITY PREFERENCE:
From Fig 2.13, we infer that about 47% of respondents prefer to purchase PET bottle of
Coca-Cola Products. About 27% prefer to purchase glass bottles, 19% prefer Can of 300ml
and only 8% prefer 1 & 2 litre bottles of Coca-Cola.
Branding
Pepsi products
Coca-Cola products
20
40
60
80
100
120
NO. OF RESPONDENTS
Fig 2.14
Pricing
120
100
80
60
40
20
0
Coca-Cola products
Pepsi products
Fig 2.15
Quality
140
120
100
80
60
40
20
0
Coca-Cola products
Pepsi products
Fig 2.16
TASTE
Pepsi products
Coca-Cola products
0
20
40
60
80
100
120
140
NO. OF RESPONDENTS
Fig 2.17
Availability
Pepsi products
Coca-Cola products
Fig 2.18
Satisfaction
Pepsi products
Coca-Cola products
20
40
60
80
100
120
140
Fig 2.19
SUGGESTIONS
AND
CONCLUSION
SUGGESTIONS
The suggestions made in this section are based on the market study conducted as part of
Coca-Cola India. The suggestions are arranged in order of priority, highest first.
Perform a detail demand survey at regular interval to know about the unique needs
and requirements of the customer.
The company should make hindrance free arrangement for its customers/retailers to
make any feedback or suggestions as and when they feel.
The company should focus to bring some more flavors like health drinks and other
low-calorie offerings. Coca-Cola India can also introduce some fruit based drinks, as
it has already entered the energy drink arena with Burn.
Coca-Colas distribution channel is mostly through retail. Whereas the competitors
also concentrates more on the multiplexes, pubs and restaurants. Coca-Cola should try
to increase their distribution in these areas.
The company must keep a watch on its primary competitors in market in order to be
able to compete with them.
The company should use new attractive system of word of mouth advertisement to
keep alive the general awareness in the whole market as a whole.
The company should be always in a position to receive continuous feedback and
suggestions from its customers/ consumers as well as from the market and try to
solve it without any delay to establish its own good credibility.
A strong watch should be kept on distributors so that the goodwill of the BRAND
doesnt get affected.
CONCLUSION
Though there were certain limitations in the study that was conducted. The sample allowed
for some conclusions to be drawn on the basis of analysis that was done on the data collected.
The data has clearly indicated that Coca-Cola products are more popular than the products
of Pepsi mainly because of its TASTE, BRAND NAME, INNOVATIVENESS and
AVAILABILITY, thus it should focus on good taste so that it can capture the major part of
the market. The study also indicated that the consumers are satisfied with the Coca-Cola
products and purchase them without any specific occasions.
In todays scenario, customer is the king because he has got various choices around him. If
you are not capable of providing him the desired result he will definitely switch over to the
other provider. Therefore to survive in this cutthroat competition, you need to be the best.
Customer is no more loyal in todays scenario, so you need to be always on your toes.
processes(Road
satisfaction.
to
market),
thereby
were
improving
made
customer
during
the