Business Environment Project

Amazing facts about me

Altogether 1.7 billion servings of Coke products are consumed every day

Coke makes so many different beverages that if you drank one per day, it would take you over 9 years to try them all
Coca-Cola's $35.1 billion in revenue makes it the 84th largest economy in the world, just ahead of Costa Rica
The Coca-Cola brand is worth an estimated $74 billion: more than Budweiser, Pepsi, Starbucks and Red Bull combined
Coke vs. Pepsico soft drink revenue -- around $28 billion vs. $12 billion (More than twice as big a Pepsico)
If every drop of Coke ever produced were put in 8-ounce bottles and laid end-to-end, they would reach the moon and
back over 2,000 times
The red and white Coca-Cola logo is recognized by 94% of the world's population
Around the world, the average person consumes a Coke product every four days
Americans ingest 1.7 million tons -- or 5 Kg per person -- of sugar each year from Coca-Cola alone

Open Happiness

PESTEL Analysis of Soft drink industry

Political

Economic

Non alcoholic beverage is under

constant vigil of FDA and similar
bodies across countries. Last year
alone, one fifth changed their rules
Political conditions, especially in
international markets (civil unrest,
government changes ) alter
conditions to conduct business
Penetration and persistence in a
market is dependent on the
surrounding environment

Not a need based product and thus

consumption is greatly effected by
economic cycle of the geography

Technological
Create opportunities for new product,
product improvements and new
marketing technique Design of more effective marketing
campaign
Small turn around time for launch of
various bottle sizes
Within last two years, the rate of
production of bottling plants has
increased two folds

Depression in US in 2008 and EURO

crisis which looms till date
India and China continue to register
a growth of 7% and 5% CAGR
respectively

Environmental
Even though, Coca Cola is committed to
protect the environment, Company has
faced constant allegations along the
following line ~ 350 Billion L of water consumption
Largest consumer of sugar and corn
syrup
To improve the self image Coca Cola
has been constantly working on 3 R
- Reduce - Recycle - Replenish

Social
People are practicing healthier life
styles due to which consumption of
carbonated drink is constantly
decreasing (down by 15% in USA). This
has also forced companies to enlarge
its health drink portfolio (49 products
added)
Coke also has lot of sugar because of
which health conscious people have
started to avoid its consumption

Legal
Markets dynamics are strongly linked
with legal framework of the
surrounding: Halted operation in India for 16
years
Ban by few EU countries dues to
poisoning of ~100 Belgium children
Demonstration in India due
depletion of water and alleged
usage of pesticides

My Internal realizations
Strengths
Brand Equity Most recognized brand in the world. Has vast global presence and unique brand identity
Company valuation One of the most valuable companies in the world, Coca cola is valued around 79.2 billion dollars
Vast global presence Of the 249 countries in the world, Coca cola is present in 200 countries across the world

Largest market share There are only 2 Big competitors in the beverage segment Pepsi and Coca cola. Out of these 2, coca cola is
the clear winner and hence has the largest market share
Fantastic marketing strategies Unlike Pepsi, Coca Cola always tries to win peoples heart. Where Pepsis target is continuously
changing, and is targeted towards youngsters, Coca cola targets people of all ages.
Customer Loyalty Very high loyalty
Distribution network Commands the largest distribution network in the world

Weakness
Not good at product innovator Coca Cola has mostly made inorganic growth as a reactive strategy. Has rarely been able to
identify future trends of the market to optimize its portfolio
High debt level due to acquisition Very high debt borrowed from the market to fuels its inorganic growth

Tainted with water mis-management and pesticide usage allegations have tainted their brand image

Open Happiness

My external image
Opportunity
Portfolio diversification Diversification in the health and food business will improve the offerings of Coca cola to their customers.
This provides opportunity of cross sell to existing customers and to leverage existing supply chain
Packaged drinking water Coca cola has a presence in the packed drinking water segment though Kinley. Kinleys expansion is slow
as of now and has a huge potential of expansion
Market the lesser selling products In the product portfolio of Coca cola, there are several products which have not found
acceptance in the market. Coca Cola needs to concentrate on the marketing of these products as well

Threat
Raw material sourcing Water is a big threat to Coca cola. Coca Cola has 115 cases in Indian Penal court with regards to wastage of
water

Indirect competitors Coffee chains like Starbucks, Caf coffee day, Costa coffee are on the rise. These chains offer a healthy
competition to Coca colas carbonated drinks. Similarly, health drinks like Real and Tropicana as well as energy drinks like Red bull
and Gatorade are stealing away the market share indirectly

Open Happiness

Higher score in internal factory summary matrix depicts stronger internal dynamics

Open Happiness

To understand Coca Colas customers outreach

The END