Professional Documents
Culture Documents
C. Marketing Mix……………………………………………………… 8
• Product………………………………………………………….. 8
• Place…………………………………………………………….. 11
• Price…………………………………………………………….. 12
• Promotion………………………………………………………. 16
D. SWOT Analysis………………………………………………………… 20
E. Research Methodology
• Research design………………………………………………… 22
• Sampling plan…………………………………………………... 22
• Data Analysis…………………………………………………… 23
• Conclusion……………………………………………………… 28
Annexure……………………………………………………………….. 29
2
THE COCA-COLA COMPANY- INTRODUCTION & HISTORY
Refreshment is a language everyone understands, and no one speaks it better than Coca-
Cola. Sometimes a soft drink is more than just a carbonated, sweetened beverage.
Sometimes it represents an exciting lifestyle. Soft drink-giant Coca-Cola was one of the
first on the bandwagon of promoting soft drinks as a way to excite your life. Starting as
early as 1907, ads described the drink as "full of vim, vigor and go."
John Pemberton, an Atlanta pharmacist, invented the drink one day in 1886 while seeking
a quick headache cure. He put it on sale for 5 cents a glass in his neighborhood
pharmacy. Back then, the syrup was mixed and then added to a glass of seltzer water
upon purchase.
Pemberton's bookkeeper, Frank Robinson, christened the drink "Coca-Cola" and wrote
the name in the distinctive script that is still used today. The name comes from the extract
of coca leaves and kola nuts contained in the syrup. Eventually in 1929, the cocaine was
completely removed from the formula, leaving caffeine to provide the kick.
But Pemberton wasn't a businessman and didn't understand the drink's potential. Between
1888 and 1891 he sold the company in bits and pieces to local entrepreneur Asa Griggs
Candler.
In 1891, Candler completed the purchase and became Coca-Cola's first president. He
traveled the country introducing pharmacists to the drink, which they sold from their
counters. Candler also gave the pharmacists plenty of clocks, scales, calendars and other
items laden with the Coca-Cola logo as well as coupons for customers to redeem a free
glass of the drink.
Even Candler didn't fully appreciate the brand's potential. In 1899, not realizing that
customers might want to take their Coke with them, he sold the bottling rights to two
Chattanooga, Tennessee lawyers for a dollar. They soon built a thriving bottling business,
in turn selling the rights to other entrepreneurs around the country. In 1916, the Root
Glass Company created the well-known curved bottle that immediately differentiated
Coca-Cola from the many imitators that had sprung up, and Coca-Cola smartly obtained a
patent for the design.
The bottling business grew, with 1,000 bottlers by 1920 as the brand expanded into Cuba,
France, Puerto Rico and other territories. In 1918, Candler sold the company to Ernest
Woodruff, whose son Robert became president in 1923. Robert Woodruff was the man
responsible for the rapid expansion of the Coke brand throughout the world -- during
World War II, he decreed "every man in uniform gets a bottle of Coca-Cola for 5 cents,
wherever he is, and whatever it costs the company."
3
The Coca-Cola Company is the world’s largest beverage company. They operate in more
than 200 countries & markets more than 2800 beverage products. Headquartered at
Atlanta, Georgia, they employ approximately 90500 employees all over the world. It is
often referred to simply as Coke or (in European and American countries) as Cola or
Pop.
4
EXTERNAL MARKETING ENVIRONMENT (PEST ANALYSIS)
Non-alcoholic beverages fall within the food category under the FDA. The government
plays a role within the operation of manufacturing these products in terms of regulations.
There are potential fines set by the government on companies if they do not meet a
standard of laws.
The following are some of the factors that could cause Coca-Cola company's actual
results to differ materially from the expected results described in their underlying
company's forward statement:-
Political structure and legal considerations also have impinged on Coco-Cola Company’s
strategies. Governments of some Arab nations boycotted Coca-Cola’s products due to a
political dispute and discontented with the company for maintaining distributors in Israel.
Economical Analysis
Being flexible and willing to change to satisfy consumers’ needs, has enabled Coca-Cola
to exploit the economies of scale that was gained by its global marketing and at the same
time making its products appeal to local taste, which these have earned the company an
enormous profits quarterly.
As Coca-Cola has expanded over the decades or even nearly a century, the company has
benefited from the various cultural insights and perspectives of the societies in which
business is done. No doubt of the remarkable experience it has, it is still very committed
to local markets, to paying attention to what people from different cultures and
backgrounds like to drink, and where and how they like to drink it, to remain competitive
and to develop more new drinks to satisfy its markets.
5
Now, the estimated brand equity of Coca-Cola is $84billion, market share of more than
50 percent in beverage industry globally and about 70 percent of its income comes from
countries outside United States. Every 10 seconds, 126,000 people in the whole world,
choose to reach out for one of The Coca-Cola Company brands, and it is the company’s
mission to make that choice exciting and satisfying, every single time.
Previously the U.S. economy was strong and nearly every part of it was growing and
doing well. However, things changed. Before the attacks on September 11, 2001, the
United States was starting to see the economy recover slightly and it is only just recently
that they achieved the economic levels. Consumers are now resuming their normal habits,
going to the malls, car shopping, and eating out at restaurants. However, many are still
handling their money cautiously. They believe that with lower inflation still to come,
consumers will recover their confidence over the next year. As researching for new
products would cost less the Coca-Cola Company will sell its products for less and the
people will spend as they would get cheap products from Coca-cola.
After discovering that Coke did not appeal as much to Japanese consumers, Coca-Cola
developed over 30 new drinks for the Japanese market, which inclusive of Asian tea,
English tea, coffee and fermented-milk drink.
In China, Coca-Cola has also begun the similar strategy of introducing beverages
developed for the taste buds of local market. It launched a fruit juice drink called Tian Yu
Di (Heaven and Earth) specifically for the Chinese market with planning of introducing
the market with a Chinese iced tea and soy milk drink.
Many U.S. citizens are practicing healthier lifestyles. This has affected the non-alcoholic
beverage industry in that many are switching to bottled water and diet colas instead of
beer and other alcoholic beverages. Also, time management has increased and is at
6
approximately 43% of all households. The need for bottled water and other more
convenient and healthy products are in important in the average day-to-day life.
Consumers from the ages of 37 to 55 are also increasingly concerned with nutrition.
There is a large population of the age range known as the baby boomers. Since many are
reaching an older age in life they are becoming more concerned with increasing their
longevity. This will continue to affect the non-alcoholic beverage industry by increasing
the demand overall and in the healthier beverages.
Some factors that cause company's actual results to differ materially from the expected
results are as follows:
• Introduction of cans and plastic bottles have increased sales for Coca-Cola as
these are easier to carry and you can bin them once they are used.
• Coca-Cola has six factories in Britain which use the most state-of the-art drinks
technology to ensure top product quality and speedy delivery. Europe's largest
soft drinks factory was opened by CCE in Wakefield, Yorkshire in 1990. The
Wakefield factory has the technology to produce cans of Coca-Cola faster than
bullets from a machine gun
7
MARKETING MIX OF COCA-COLA
Firstly, we will look at how Coca-Cola has used their marketing mix. The marketing mix
is divided up into 4 parts; product, price, promotions and place.
1. Product:
The product (Coca-Cola soft drink) includes not just the liquid inside but also the
packaging. On the product-service continuum we see that a soft drink provides
little service, apart from the convenience. Soft drinks satisfy the need of thirst.
However, people are always different, some want more and others want less.
Therefore Coca-Cola has made allowances for that by providing many sizes. We
also have particular tastes, and again they have provided several options. So,
although thirst is what is needed to be satisfied and that is the core benefit, we are
receiving other benefits in the taste and size. Coca-Cola has developed several
different flavours and sizes as mentioned above, but also several brands such as
Sprite, Lift, Fanta and Diet Coke which increase the product line length, thus
making full use of the market to maximize sales.
The quality of the soft drink is needed to be regularly high. Sealed caps ensure
that none of the "fizz" is lost. The bottles are light, with flexible packaging, so
they won't crack or leak, and are not too heavy to casually walk around with. The
cans are also light and safe.
• Coca-Cola,
• Coca-Cola classic,
• caffeine free Coca-Cola,
• diet Coke
• caffeine free diet Coke,
• diet Coke with lemon
• Vanilla Coke,
• diet Vanilla Coke,
• Cherry Coke,
• diet Cherry Coke,
• Fanta brand soft drinks,
• Sprite,
8
• diet Sprite
• Sprite Remix
9
Product Lifecycle of Coke:
The markets where Coke is a dominant player are United States of America, Europe and
Asia, Africa. There is a vast difference in terms of above given phases for example, in
U.S.A & Europe it has reached maturity stage where it can’t expand its market more but
if we consider Asia, it is still in the growth phase.
Coca-Cola is currently going through the maturity stage in Western countires. This
maturity stage lasts longer than all other stages. Management has to pay special attention
to products during this stage of the product life-cycle. During the maturity stage, products
usually go through a slowdown in sales growth. According to Coca-Cola's 2001 annual
report, sales have increased by 1.02% compared to last year. This percentage has no
comparison to the high level of growth Coca-Cola enjoyed during its growth stage. To
add a little variation Coca-Cola took the Coca-Cola Classic and added variations to it,
including Cherry Coke, Vanilla Coke and Diet Coke. Also Coca-Cola went from 6-oz.
glass bottles to 8-oz. cans to plastic liter bottles, all helping increase consumption.
COCA-COLA
10
2. Price:
Like any company who has successfully endured a century of existence, Coca-
Cola has had to remain tremendously fluent with their pricing strategy. They have
had the privilege of a worthy competitor constantly driving them to be smarter,
faster, and better. A quote from Pepsi Co's CEO "The more successful they are,
the sharper we have to be. If the Coca-Cola Company didn't exist, we'd pray for
someone to invent them." states it simply. The relationship between Coca-Cola &
Pepsi is a healthy one that each corporation has learned to appreciate.
Throughout the years Coca-Cola has made many pricing decisions but one might
say that their ultimate goal has always been to maximize shareholder value. As
cola consumption has decreased in the US colas have come to realize the
untapped international market. In 2003 both Coke and Pepsi had a solid presence
in India and had each introduced a 300mL bottle. In order to grab market share
Pepsi began to drop prices (even with summer approaching, which was contrary
to policy in America). Shortly thereafter, Coca-Cola decided to drop their prices
slightly, but focused on the reduced price point of their 200mL container. Coca-
Cola planned to use the lower price point to penetrate new cities that were
especially price sensitive. The carbonated soft drink market in India is nearly 37%
of the total beverage market there.
This low price strategy was not unfamiliar to Coca-Cola. Both Coke & Pepsi
utilized a low price strategy in the early 1990s. After annihilating the low price
store brands, Coke chose to reposition itself as a "Premium" brand and then raise
prices.
Coca-Cola products would appear, on the shelf, to have the most expensive range
of soft drinks common to supermarkets, at almost double the cost of no name
brands. This can be for several reasons apart from just to cover the extra costs of
promotions, for which no name brands do without. It creates consumer
perceptions and values. When people buy Coca-Cola they are not just buying the
beverage but also the image that goes with it, therefore to have the price higher
reiterates the fact that the product is of a better quality than the rest and that the
consumer is not cheap. This is known as value-based pricing and is used by many
other industries in attracting consumers.
In India, the average income of a rural worker is Rs.500 a month. Coca Cola
launched a 200 ml bottle for just Rs.5, an affordable amount on the pockets of the
rural audience.
11
3. Place:
Coca-Cola entered foreign markets in various ways. The most common modes of
entry are direct exporting, licensing and franchising.
Besides beverages and their special syrups, Coca-Cola also directly exports its
merchandise to overseas distributors and companies. Other than exporting, the
company markets internationally by licensing bottlers around the world and
supplying them with the syrup needed to produce the product.
There are different types of franchising. The type that is used by Coca-Cola
Company is manufacturer-sponsored wholesaler franchise system. It is very
comparable to licensing but the only difference is that the finished products are
sold to the retailers in local market.
Coca Cola has managed their company’s marketing and sales strategy within
channels. Have you ever considered the significance of the Coke vending machine
to the success and profitability of the Coca Cola company? This channel is direct
to consumer and vending machines often have little to no competition and no
trade or price promotions.
The Coke Company operates three primary delivery systems for its business
channels:
• Supermarkets
• Convenience Stores
• Fast Food
• Petroleum Retailers
• Chain Drug Stores
• Hotels/Motels/Resorts
• Mass Merchandisers
• U.S. DOD Military Resale retail commands: AAFES, NAVRESSO and
DECA
• Vending
12
In 2006, the Company began changing its delivery method for its route delivery
system. Historically, the Company loaded its trucks at a warehouse with products
the route delivery employee would deliver. The delivery employee was
responsible for pulling the required products off a side load truck at each
customer location to fill the customer's order. Coke began using a new CooLift®
delivery system in 2006 in a portion of the Company's territory which involves
pre-building orders in the warehouse on a small pallet the delivery employee can
roll off a truck directly into the customer's location. The CooLift® delivery
system involves the use of a rear loading truck rather than a conventional side
loading truck. Coke will continue to rollout this program over the next several
years since they expect such significant savings and more efficient deliverys. This
is a huge investment for Coke.
Coca-Cola floods all possible retailing stores in satisfying the third part, place. In
supermarkets and convenient stores, Coca-Cola products are always easy to
identify, and usually make up the greater proportion of options to buy. This
increases their market exposure through effective use of the retailers. For a
FMCG it is important that they can be found and purchased easily. With many
automatic Can machines located in many sports stadiums and shopping malls, you
don't even need to go to a store to buy a drink. This greatly enhances the speed of
purchase.
The company produces concentrate, which is then sold to various licensed Coca-
Cola bottlers throughout the world. The bottlers, who hold territorially exclusive
contracts with the company, produce finished product in cans and bottles from the
concentrate in combination with filtered water and sweeteners. The bottlers then
sell, distribute and merchandise Coca-Cola in cans and bottles to retail stores and
vending machines. Such bottlers include Coca-Cola Enterprises, which is the
largest single Coca-Cola bottler in North America and Western Europe and food
service distributors.
13
The Coca-Cola Company only produces a syrup concentrate, which it sells to
various bottlers throughout the world who hold Coca-Cola franchises for one or
more geographical areas. The bottlers produce the final drink by mixing the syrup
with filtered water and sugar (or artificial sweeteners) and then carbonate it before
filling it into cans and bottles, which the bottlers then sell and distribute to retail
stores, vending machines, restaurants and food service distributors.
The Coca-Cola Company owns minority shares in some of its largest franchises,
like Coca-Cola Enterprises, Coca-Cola Amatil, Coca-Cola Hellenic Bottling
Company (CCHBC) and Coca-Cola FEMSA, but fully independent bottlers
produce almost half of the volume sold in the world. Since independent bottlers
add sugar and sweeteners, the sweetness of the drink differs in various parts of the
world, to cater for local tastes.
14
COCA-COLA DISTRIBUTION SYSTEM
15
4. Promotion:
Coca-Cola uses the "pull strategy" in their promotion. That is, they promote to
the consumers to create the want for their product which in turn creates a demand
on the retailers and then back to them. For example, in supermarkets and
convenience stores Coca-Cola has their own fridge which contains only their
products. There is little personal selling, but that is made up for in public
relations and corporate image. Coca-Cola sponsors a lot of events including
sports and recreational activities. All these are used to create awareness of the
product. They also use competitions, such as check under the lid for an instant
prize, to encourage consumers to buy their product over the competition's
products. Coca-Cola promotions then create knowledge and liking about the
product through campaigns that show that it has the best taste, is the most popular
and is the one of the future, whilst appealing to a large range of audiences.
In the 1970s, a song from a Coca-Cola commercial called "I'd Like to Teach the
World to Sing", produced by Billy Davis, became a popular hit single.
16
Coke's advertising is rather pervasive, as one of Woodruff's stated goals was to
ensure that everyone on Earth drank Coca-Cola as their preferred beverage. This
is especially true in southern areas of the United States, such as Atlanta, where
Coke was born.
The advertisement with the tag line - 'Thanda Matlab Coca-Cola ' was targeted at
rural and semi-urban consumers. The series of Aamir Khan Ads on hill station
acting like a nepali and those in a Punjabi ‘Yaara da Tashan’ were a great success
and an important aspect focusing on acceptability. Except TV ads, Coca-Cola
India also concentrated on 47,000 hatts (weekly markets) and 25,000 melas (fairs)
held annually in various parts of the country.
BRAND AWARENESS
The company has been sponsoring big events, like Olympics, Sea Games, FIFA
Cup, International Film Festivals all over the world to create awareness,
credibility and to brand itself as world-class company. It also makes big donations
to organizations, charities and involvement in the communities. These activities
have aided Coca-Cola in creating a positive image and consumers’ perception
toward the company.
17
Coca-Cola- the official sponsor of Olympics, Beijing 2008
18
Coke’s Ad with Mc Donald’s
19
SWOT ANALYSIS
Strengths:
Coca-Cola has been a complex part of American culture for over a century. The
product's image is loaded with over-romanticizing, and this is an image many
people have taken deeply to heart. The Coca-Cola image is displayed on T-shirts,
hats, and collectible memorabilia. This extremely recognizable branding is one of
Coca-Cola's greatest strengths.
A company like Coca-Cola has much internal and external strength, but when
launching a product of this sort, they begin to run into many internal and external
weaknesses as well. As far as internal strengths go, Coca-Cola itself is a strong
company to say the least. Not only are they a $23 billion company, but in 200
nations, Coke sells about 400 drink brands, including four of the top five sellers
right now. They own 36% of the largest Coke bottler in the world, Coca-Cola
Enterprises, which staffs facilities all over the world.
Although Coke has never produced an organic product, they do own Odwalla,
which is a natural juice company. This product would not be marketed as an
Odwalla brand, but Odwalla's knowledge of natural juice making will be a great
strength for Coca-Cola.
Organic products are on the rise, with 70% of Americans having purchased
something organic at least once. While organics are becoming more and more
popular, there still are not many well-known organic companies; therefore, Coca-
Cola will not have much competition.
Perhaps one of their biggest strengths is the brand loyalty their customers have.
When this product is launched, avid Coke drinkers will choose this organic fruit
juice or soda over any other competitor simply because it's a Coca-Cola product
and they trust it.
20
Weaknesses:
Coca-Cola on the other side has effects on the teeth's which is an issue for health
care. It also has got sugar by which continuous drinking of Coca-Cola may cause
health problems. Being addicted to Coca-Cola also is a health problem, because
drinking of Coca-Cola daily has an effect on your body after few years.
Opportunities:
Threats:
Currently, the threat of new viable competitors in the carbonated soft drink
industry is not very substantial. The threat of substitutes, however, is a very real
threat. The soft drink industry is very strong, but consumers are not necessarily
married to it. Possible substitutes that continuously put pressure on both Pepsi and
Coke include tea, coffee, juices, milk, and hot chocolate.
Even though Coca-Cola and Pepsi control nearly 40% of the entire beverage
market, the changing health-consciousness of the market could have a serious
affect. Of course, both Coke and Pepsi have already diversified into these
markets, allowing them to have further significant market shares and offset any
losses incurred due to fluctuations in the market.
Consumer buying power also represents a key threat in the industry. The rivalry
between Pepsi and Coke has produced a very slow moving industry in which
management must continuously respond to the changing attitudes and demands of
their consumers or face losing market share to the competition. Furthermore,
consumers can easily switch to other beverages with little cost or consequence.
21
METHODOLOGY
Research Design
Survey Research Method was used because the nature of the research was basically of
descriptive type and best suited the objective of the survey.
Instruments Used
In this case a Questionnaire was used as a research instrument to collect the Primary
Data. A questionnaire was preferred as it offers flexibility to the surveyor.
The Questionnaire had mostly Close ended questions.
SAMPLING PLAN
Sample Size
After completing the survey, each question was analyzed from the questionnaire & the
data was tabulated accordingly using Table Graphs.
22
DATA ANALYSIS
35
30
25
20
15
10
0
yes no
Out of the 30 people we surveyed, all of them said they had tried Coca-Cola
atleast once. This explains the brand awareness of Coca-Cola.
2. Gender
20
18
16
14
12
10
8
6
4
2
0
male female
23
3. Age groups
Age Groups
51 & above
36-50 yrs
20-35 yrs
10-19 yrs
below 10 yrs
0 5 10 15
no. of people
As represented in the chart, majority of the respondents were in the age group of
20-35 years, the least of the lot being 2 kids who were also asked to participate in
the survey.
no
23%
yes
77%
From the analysis, it was found that majority of 77% (23 people) respondents said
they enjoyed drinking Coca-Cola as against 23% (7 people) who said they
preferred other drinks.
24
5. What brand would you say is more popular among the public?
a) Coca-Cola
b) Pepsi
c) Other
Others
7%
Pepsi
37% Coca-Cola
56%
As seen in the chart, out of 30 people, 17 respondents said, in their opinion, Coca-
Cola was more popular while 11 respondents said they preferred Pepsi as a
popular brand.
not bad
0 2 4 6 8 10 12 14
The chart represents that a majority of people thought the Advertisements were
good enough & they like what they see.
25
7. Do you think the price for a can of Coca Cola is cheap or expensive?
expensive
slightly
overpriced
cheap
0 5 10 15 20 25
8. If you were to see the Coca-Cola logo somewhere would you recognize it?
no
0%
yes
100%
It is understood from the fact that the Logo of the Company still has its image
in the minds of the people with all the respondents saying they would
recognize the “Coca-Cola” Logo.
26
9. How often do you buy the product?
everyday
never
0 5 10 15
As it can be seen in the figure, it was concluded that majority of the respondents
bought the product quite frequently. This shows the brand loyalty of the
customers towards Coca-Cola.
Restaurants
general stores
super markets
0 5 10 15 20
27
CONCLUSION
• It was observed that Coca-Cola has been perceived quite positively as it has been
projected. People are aware of the Brand & Awareness of Coca-Cola is quite high
in the market. When a product is launched, avid Coke drinkers choose this soda
over any other competitor simply because it's a Coca-Cola product and they trust
it.
• Although Coke has been into controversies, people still prefer to stay loyal to the
Brand with Coca-Cola being termed as a more popular brand than Pepsi.
• Coca-Cola products would appear, on the shelf, to have the most expensive range
of soft drinks common to supermarkets, at almost double the cost of no name
brands. This can be for several reasons apart from just to cover the extra costs of
promotions, for which no name brands do without. When people buy Coca-Cola
they are not just buying the beverage but also the image that goes with it,
therefore to have the price higher reiterates the fact that the product is of a better
quality than the rest and that the consumer is not cheap.
• In supermarkets and convenience stores Coca-Cola has their own fridge which
contains only their products. There is little personal selling, but that is made up
for in public relations and corporate image. Coca-Cola sponsors a lot of events
including sports and recreational activities.
28
ANNEXURE
SAMPLE QUESTIONNAIRE
Name: __________________________
a) Yes
b) No
2. Gender
a) Male
b) Female
a) Yes
b) No
c) It's not bad
5. What brand would you say is more popular among the public?
d) Coca-Cola
e) Pepsi
f) Other
29
6. Do you enjoy Coca Colas advertisements on TV?
7. Do you think the price for a can of Coca Cola is cheap or expensive?
a) Cheap
b) Slightly over priced
c) Expensive
8. If you were to see the Coca Cola logo somewhere would you recognize it?
a) Yes
b) No
a) Never
b) Once/few times a year
c) Few times a month
d) Few times a week
e) Everyday
a) Super Markets
b) General stores
c) Restaurants (McDonald's, Subway, KFC etc)
30