Palmes, Nadean Kate P.

MWF/2:00-3:00PM

I. Coca-Cola Company - 2007

II. Time Context: 1886 - Present

Summary:

In May 8, 1886, Coca-Cola was invented by a pharmacist named John Stith

Pemberton, otherwise known as "Doc" in Columbus, Georgia. He fought in
the Civil War, and at the end of the war he decided he wanted to invent
something that would bring him commercial success. Usually, everything he
made failed in pharmacies. He invented many drugs, but none of them ever
made any money. So, after a move to Atlanta, Georgia, U.S., Pemberton
decided to try his hand in the beverage market. In his time, the soda fountain
was rising in popularity as a social gathering spot. Temperance was keeping
patrons out of bars, so making a soda-fountain drink just made sense. And
this was when Coca-Cola was born.

However, Pemberton had no idea how to advertise. This is where Frank

Robinson came in. He registered Coca-Cola's formula with the patent office,
and he designed the logo. He also wrote the slogan, "The Pause That
Refreshes." Coke did not do so well in its first year. And to make matters
worse, Doc Pemberton died in August 1888, meaning he would never see the
commercial success he had been seeking.

After Pemberton's death, a man named Asa Griggs Candler rescued the
business. In 1891, he became the sole owner of Coca-Cola. It was when
Candler took over that one of the most innovative marketing techniques was
invented. He hired travelling salesmen to pass out coupons for a free Coke.
His goal was for people to try the drink, like it, and buy it later on, In addition
to the coupons, Candler also decided to spread the word of Coca-Cola by
plastering logos on calendars, posters, notebooks and bookmarks to reach
customers on a large stage. It was one step in making Coca-Cola a national
brand, rather than just a regional brand. A controversial move on the part of
 Candler was to sell Coca-Cola syrup as a patent medicine, claiming it would
get rid of fatigue and headaches. In 1898, however, Congress passed a tax in
the wake of the Spanish-American war. The tax was on all medicines, so
Coca-Cola wanted to be sold only as a beverage. After a court battle, Coca-
Cola was no longer sold as a drug.

Coca-Cola has 7 operating segments:

1. Africa
2. East and South East Asia and Pacific Rim
3. European Union
4. Latin America
5. North America
6. North Asia, Eurasia and the Middle East
7. Bottling Investments.

Mission:
Everything we do is inspired by our enduring mission:
To refresh the world ...
To inspire moments of optimism and happiness...
To create value and make a difference...

Vision:
Our vision serves as the framework for our Roadmap and guides every
aspect of our business by describing what we need to accomplish in order to
continue achieving sustainable, quality growth.
People: Be a great place to work where people are inspired to be the best
they can be.
Portfolio: Bring to the world a portfolio of quality beverage brands that
anticipate and satisfy people's desires and needs.
Partners: Nurture a winning network of customers and suppliers, together we
create mutual, enduring value.
Planet: Be a responsible citizen that makes a difference by helping build and
support sustainable communities.
Profit: Maximize long-term return to shareowners while being mindful of our
overall responsibilities.
Productivity: Be a highly effective, lean and fast-moving organization.

III. Objectives:

To help the business become profitable enough to pay for their debt.
 To make a strategic recommendations that will help improved their
operations.
To help the business reduce its dependence on carbonated
beverages..

IV. Central Problem:

The demand for their products are slowly decreasing due to consumers
health consciousness against carbonated drinks and they focus more on
beverages that the other competitors diversified in food.

V. Areas of Consideration (SWOT)

Strengths
1. Best brand in terms of revenue, profits, brand image and stock market
performance globally.
2. They are focusing on Corporate Social Responsibility programs that
helped the company build a good image.
3. A large variety of their products are sold worldwide.
4. Loyal customers all over the world.
5. Their good advertising and promotion of their products.
6. Owns and markets four of the worlds top five soft drink brands: Coca-cola,
Diet Coke, Sprite and Franta.

Weaknesses
1. They focus on beverages only that the other competitors diversified in
both food and beverages that may threaten the stability of the business.
2. The company has 8 billion dollars of debt in the market.
3. Negative feedbacks of some customers thru social medias had a bad
impact in their business.
4. Their market standing become weak that they cant cope up with the
changes in todays environment/market.

Opportunities
1. Entering the food industry (that wil compliment with their product) can help
the expanding of Coca-Cola in the market.
2. The consumers prefer buying smaller bottles or solo bottled drinks than
the big ones.
3. Increased more partnerships with the fast food chains.
 4. Non-carbonated and energy drinks are increasing in demand and its a
good opportunity for Coca-cola to produce one also.

Threats
1. Changes in the government policy.
2. Natural Calamities such as fire, earthquake, hurricanes etc.
3. Changes in consumer preferences.
4. The perception of the customers that drinking too much sugar based
drinks may lead to some health problems.
5. The water resources in some parts of the world are being limited.
6. A lot of substitutes products are now available in the market.
7. Many consumers are becoming health conscious and because soft-drinks
are sugar based drinks, the demand are slowly shifting to other drinks like
Tea, Fresh Juices, and bottled drinks.
8. The prices of their raw materials like sugar are increasing rapidly.
9. Strong threat of other competitors like PepsiCo and Cadbury Schweppes
PLC.

VI. Alternative courses of action

A. Coca-Cola should focus on marketing tea and water beverages which

contain less sodium and sugar and they can produce organic beverages
for younger people

Advantages:

New batch of consumers will buy the product.

Problems in Health sector will be solved
Can cope up with the changes in consumers preferences.

Disadvantages:

New set of products means increase in cost of the production

Risk in revenue

B. Coca-cola should have a vertical expansion because PepsiCo has a

horizontal expansion of their business. They should focus on beverages
business and related business. There is a rapid change in the
 environment so Coca-Cola should be sensitive of any new trend and
position itself a unique brand in order to keep its competitive advantage.

Advantages:
No additional spending on cost productions for new products
They already know advantages of their products

Disadvantages:
No additional sources of income
Weaken the market stability of Coca-cola
Prizes of raw materials

C. Stay focus on the carbonated soft drink sector competitively.

Advantages:
No additional cost needed for the new products

Disadvatages:
It will weaken or make Coca-Cola lose the market leadership in
beverage industry.
Many customers will stop buying their product due to Health
Consciousness.
Increase in the prizes of raw materials such as sugar.

VII. Recommendation/ Strategy Formulation

I therefore conclude that the best solution for this case is A.C.A no. 1, Coca-
Cola should focus on marketing tea and water beverages which contain less
sodium and sugar and they can produce organic beverages for younger
people. Because of its high demand nowadays and they can cope up with the
competition with other companies that already cater such products and this
will help with the objectives of the case.

VIII. Plan of Action

Since Coca-Cola is a large company, different franchise were built

worldwide having a lot of staff/manager.
 1. First, conduct a board/staff meeting and asked them the current
situation of the business in different parts of the world.
2. Asked them if they have a suggestion on how to respond to these
problems.
3. Make a draft on what was brainstormed during the meeting.
4. Conduct again a meeting and discussed what was the agreed solution
for the problems and ask if there are any objection.
5. Repeat step 2 and 3 if there is an objection until all the board/staff
agreed.
6. Conduct a survey for the sampling of the solution to the problem. (i.e.,
new product to the market)
7. If positive, proceed on implementing it but if not, repeat the steps.

IX. Potential Problems

What if...
the target revenue will not be efficient to pay for the debt?
the costumers will not loved the new product?
The consumers still doubt the heath
The BOD and other staffs cant decide if they will create a new product
or improve their past products.

X. Contingency Plan

the target revenue will not be efficient to pay for the debt? create a
new product which is in demand this days that will help the company to boost
their income so that the money in the market segment will continue its flow.
the costumers will not loved the new product? Not all new products
are being loved immediately by the consumers so having a strong and good
advertising, which Coca-Cola Company are good at, is a good way for the
business to be loved.

The BOD and other staffs cant decide if they will create a new product
or improve their past products. Talk and ask the lower level
management of the company because they are the one who interacts with the
products and they know what is good and what is bad for the consumers.