Introduction
We propose to select an analysis of the marketing strategy of Coca-Cola, the popular brand of non-alcoholic beverage, which is the leading brand all over the world.
Coca-Cola, the largest soft beverage manufacturer, and distributor had its humble beginning in the year 1886, with an initial investment of US $ 70. This one-man business enterprise has now risen into a vast empire with its capital base of US $ 50 billion. Truly, a rags-to-riches story, Coca-Cola has made itself a household name in more than 200 countries in the world, with over 400 varieties of products, and is now the market leader in the soft drinks scenario. The other main brands of Coca-Cola Company are Diet Cola, Fanta, and Sprite. These brands have a good customer base, market demand, and unique taste. Attractive packaging and promotions are the main marketing strategies being currently adopted by the Coca-Cola Company.
Executive summary
Every organization is being developed according to a particular structure. The the framework of the organization will play an important role in its success. Structural hierarchy involves top management executives to the lower-level workers. Proper levels of communication between these groups can influence the overall performance of the organization. The core area of marketing is an exchange that is intended to satisfy human needs/wants. The effective marketing function is mainly focused on proper interaction between the whole team. Management’s main activities are to analyze, plan and implement programs to attain the desired level of the targeted market. Currently, Coca-Cola sells its products through supermarkets and other big retail outlets.
Overseas distribution, through franchisees of Coca-Cola Company, ensures that their products reach all parts of the world and ensure customer satisfaction through product quality. Coca-Cola is the world’s largest manufacturer and distributor of nonalcoholic beverages. At present they are operating a marketing function in over 200 countries. Moreover, they are focusing on a wide range of products.
Now they are dominating the non -alcoholic beverage market. Although their nearest rival is Pepsi, yet Coca-Cola has been able to achieve a good market share during the last three years. Coca-Cola has a good brand image and this is one of the key competency areas of their marketing strategy. In this context, Coca-Cola tries to attain its ultimate marketing objective and also innovate certain recent marketing strategies to improve the existing brand in the future. Every product has to face a lot of competition from domestic and international markets. The retention of the particular product is depending upon its core competency.
Mission Statement
All actions which Coca-Cola perform are inspired by their zeal to rejuvenate the community, physically, mentally, and spiritually, to encourage growth through their products and efforts, to sustain values, and make a substantial contribution in all work. To achieve a high degree of growth Coca Cola have envisaged a goal that entails maximum returns to the stakeholders while realizing its total commitment to society. For employees, the company should be an ideal place to work so that they can produce the best results. To produce an array of soft drinks that could slake the thirst of the community. Cultivating a group of associates and building cooperative loyalties being a dutiful corporate citizen.
Environmental Analysis
Environmental analysis is mainly of two categories, Macro, and Microenvironment. Macro environmental analysis is relating to marketing competition, customer, and Product frame. The micro environmental analysis is mainly focusing on a single aspect that influences any of the marketing policies of the organization. In the context of Coca Colas’ marketing environment, the competitor’s strategy on packaging and distribution can influence the company’s strategy in these areas.
Marketing Environment
A successful Marketing plan requires adequate information about the nature of the market, the customer, the competition, and the environment. The main purpose of marketing is to analyze favorable and unfavorable factors influencing the marketing environment, which are both external and internal in nature.
- Competitive Forces: In the area of the non-alcoholic beverage market, almost all brands of Coca-Cola have their rival brands in Pepsi. Some of the main brands of Coca Cola such as Sprite, Cherrystone, Diet Coke, and Coca Cola dark, have its rivals in Pepsi (Diet Pepsi, 7 Up, Wild Cherry, etc) “Competition typically is defined as among firms within an industry producing products that are substitutes for one another. Therefore, the identification and evaluation of marketplace competitors is a key element of strategic marketing and a vital element of corporate survival.” (Heiser, Robert. S., McQuitty, Shaun., and Stratemeyer, Andreas. W).
Coca Cola product is facing severe competition from domestic manufactures. Mainly in international markets, they are facing competition from local soft drink manufacturers.
The main competition between Coca-Cola and Pepsi is in the area of promotion and advertisement. advertisement competitions call it ‘cola wars’. Each company is trying to use valuable celebrities for their advertisements. Both companies target television advertisement campaigns to introduce celebrities for their advertisement.
- Economic Forces: In the economic analysis of Coca Colas, marketing activities are very important. In the international market, Coca-Cola’s marketing policies are influenced by the economic position of countries. Government policies on interest rates and other economic factors influence the market. Economic position includes the GDP, per capita income, the standard of living, and other economic factors, which influence the market.
- Political and Legal Forces: The nonalcoholic beverage industries are regulated by the Food Category Act. The business activities are carried on as per the rules framed by the government.
- Technological Forces: Coca-Cola is following the usage of advanced technologies in all its business activities. In production and Marketing, their advanced production techniques and packaging systems are very important factors for their success. “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.” (Technological Analysis of Coca Cola, PEST Case study: Pepsi Cola).
The technological introduction helps to enhance the total outlay through the advertisement and promotional activities of Coca-Cola.
- Socio-Cultural Forces: Marketing activities are tightly matched with societal concepts. Some societies are practicing healthier lifestyles it influences the entire market as well as the buying behavior of customers.
Target Market
Target marketing is an organization’s strategic decision about where to sell the products, who its customers are, what its organizational structure is like, and to decide how it is going to target the respective areas of the market. There are mainly three types of targeting-Undifferentiated Marketing; which is a mass marketing concept. Under this type, the firm decides to aim its source at the entire market with one particular product. Differentiated marketing- it is based on segments and separate marketing programs are applicable. Concentrated marketing- The name itself is indicative of the fact that it is concentrating on one particular segment. Coca Cola has the following Brand strategy:
Identification
Manufacturers try to identify the real potential buyers in the market place and they target their market and product in that potential areas. Manufacturers design and develop Specific marketing functions to ensure that a consumer’s perception is more favorable to their products as compared to that of the competition. In market identification, the company is mainly concentrating on maintaining the real potential market and consumer behavior.
Need Analysis: The existence of a market is highly dependent on real potential buyers. The retention of the customer is possible only in accordance with goods provided to them. For this, it is necessary to analyze the needs wants, and desires of the consumers. Coca-Cola’s strategy in this area is that they are continuously analyzing the customer needs and fulfilling them.
Current Marketing objectives and performance
Review of Marketing Objectives
Coca-Cola’s main marketing objectives are to keep in tight with market share, volume, and retention in the international arena. Market share means the outlay of the business and the quantum of marketing of a particular product means its sales. Demand and supply analysis also very important in marketing; pricing and distribution are based on demand analysis. “In strategic market analysis, estimated demand parameters play a crucial role as the estimation of market power and strategic behavior depends crucially on the estimated price and expenditure elasticities.” (Dhar tirtha P, Jean-Paul Chavas, Ronald W Coterill, Brian W Gould).
Retention is one of the key areas of marketing for a successful marketing function and it is very important that the organization tries to retain its customers by offering attractive sales promotional activities. The emergence of new buyers in the market depends significantly on the references of existing customers about the product.
Performance Analysis
Performance analysis of an organization is related to how the company is performing in its business activities. In marketing, revenue and market share are the indicators of performance. Coca-Cola is the global leader in the nonalcoholic beverage industry. They are presently operating their business activities in more than170 countries and have more than 400 varieties of products. Coca-Cola’s main strength in the area of its strategic marketing. Coca-Cola’s advertisements show the brand image.
SWOT Analysis
Strengths
The main strength of Coca-Cola’s product is its popularity in the world’s non-alcoholic beverage market. The brand image of Coca-Cola also plays a significant role in their marketing, many people consider that Coca-Cola’s brand is the symbol of quality which is the main area of their strength. Moreover, they provide high-quality products to its customers, and their innovative advertisement and promotional activities also help them to achieve a good market share.
Weaknesses
Some countries have banned Coca-Cola products due to controversies arising out of its consumption effects on community health.
Opportunities
The main opportunity of Coca-Cola products is their brand image and popularity in the market. It helps them to get future customers. Coca-Cola has a good customer base that could help them to achieve more customers in the future.
Threats
Threats for Coca-Cola stem mainly from their present market problems relating to the banning of products in some countries, the perceived notion being that the consumption of Coca-Cola products is a health hazard that may impede the future marketability of their products. Uncertain consumer buying behavior also poses a threat to Coca Cola market.
Matching Strengths to Opportunities/Converting Weaknesses and Threats
The strength of Coca-Cola is its brand image and loyal customer base. This helps create a number of opportunities in the market. Product quality and their marketing strategy is another main strength of Coca-Cola, it also helps them to achieve a good market share in the global nonalcoholic beverage market. The matches between weaknesses and threats are that people are following healthy lifestyles, they are not ready to use nonalcoholic beverages and some countries have banned Coca-Cola products for community health. These changes adversely affect Coca Colas’ future market.
Marketing Strategies
The market is a collection of buyers and various products in this context; each buyer is potentially a separate market because of their unique needs and wants. In the context of Coca-Cola marketing, they are following undifferentiated marketing. The main strategic area of Coca-Cola’s marketing is advertisement and promotion. Coca-Cola’s attractive packaging and distribution system are also one of the strategic areas of their business.
Target Market: Target marketing is one of the strategic decisions of an organization about where to sell the product. Coca-Cola is following a mass marketing strategy. They are not following segmentation in marketing; their strategy is to market the product to a mass market. Coca Colas marketing strategy is a single drink produced for the whole market.
Marketing Mix
Product
A product is a group of concrete items whose characteristics are that they are available in a readily identifiable position. It has attributes like Packaging, Pricing, and goodwill of the manufacturer and also the customer’s preference. “Product is, of course, the thing (or service) that you have to offer to the customers. There are a number of things about the product you should evaluate.” (Marketing-Product Description, Name, New Product Adaptability). A product satisfies a particular want of the customers. In the context of Coca-Cola, the product is an established brand having wide consumer appeal and quality it provides rejuvenation and thirst-satisfying properties.
Price
The price of the product is basically the price paid for the factors of production, and it’s dependent on the product demand and supply matrix. In product planning, management may decide to improve the quality of its product or value addition to its marketing strategy these decisions can only be implemented if the market is able to accept a price that covers this additional cost.
Promotion
The promotion is an important one in the marketing mix it is dealing with all sales promotional activities. Marketers are generally adopting Advertisements and other promotional activities. Coca-Cola’s main strategic area of marketing is its attractive advertisement and promotions.
“Promotion is the specific mix of advertising, personal selling, sales promotion, and public relations a company uses to pursue its advertising and marketing objectives.” (Promotion, Marketing-Promotion objectives, offer, Response, PR, WWW, Direct Mail). We find all these factors present in the case of Coca-Cola.
Place
The place refers to where the buyers and product meets. In the context of Coca-Cola, they sell their products through retail outlets and supermarkets. They also distribute products through vending machines.
Marketing Implementation
The success of an organization is relating to the Proper implementation of marketing activities. All marketing activities are relating to strategic timing. Right time implementation of advertisement and promotion is very important. In a competitive market environment, all manufacturers are fighting for achieving more customers. The timely implementation of marketing activities is very important for achieving good market performance.
Marketing Organization
A marketing organization’s main activities are to market to customers and generate revenues for the organization. Marketing organization’s activities are Sales, Promotion, Customers care, etc. The marketing activities of a firm are coordinated and well managed, the chief marketing executive is the plays an important role in these activities. The management concentrates on the exchange process of marketing. The main job of marketing management is to analyze the market and plan the marketing and implement the strategy.
Activities, Responsibilities, and Time table for Completion
The main function of marketing is the transaction and exchange of products and services intended to human needs and wants. The main activities of the marketing department are as follows.
- Analyze the product.
- Analyze the market and customers.
- Setting a target market.
- Analyze the competitors.
- Setting a strategy on pricing and distribution etc.
- Distribute the product to market.
- Collect customer reaction.
- Evaluation of market share.
- The setting of future market strategy.
Responsibility
The main responsibility of marketing is to deliver the product to customers and satisfy their needs. All customers are expecting a benefit from their purchase. Customers are spending money for getting utility from a product. In this context, the ultimate responsibility of a marketing firm is to satisfy the customers by providing quality products.
Evaluation and Control
Performance Standards and Financial Control: The performance of marketing is measured through the growth in the market share and revenue. A Market Survey is a very effective tool for analyzing the market and customers’ reactions to a product. Coca Cola maintains their product quality and they implement a systematic marketing strategy for achieving growth. “Coca-Cola has been named the world’s top brand for a fourth consecutive year in a survey by consultancy Interbrand.” (Coca-Cola Still Worlds Top Brand).
These strategic marketing and production help the company to maintain its leadership in the global nonalcoholic beverage industry. Financial control is a company implemented strategy in the area of finance. The main aim is for achieving higher profits and revenue. Financial control is the maintenance of a proper balance between both receipts and expenditures. To carry forward the marketing function continuous flow of adequate funds are required.
Conclusion
Business can attain profit through the ultimate turn over and adequate investments. Coca Cola’s marketing strategy is to satisfy their everlasting customers and creating new customers. In this context financial control of Coca Cola is creating more sales and the same time increase the profit margin.
Works Cited
- Heiser, Robert. S., McQuitty, Shaun., and Stratemeyer, Andreas. W. Broadening the competitive environment: the customer perspective. Academy of Marketing Science Review. 2005.
- Technological Analysis of Coca Cola. PEST Case study: Pepsi Cola. Web.
- Dhar, tirtha. P., Chavas, Jean. Paul., Coterill, Ronald. W., and Gould, Brian. W. An Econometric Analysis of Brand Level Strategic Pricing between Coca Cola and Pepsi Inc. 2007.
- Marketing – Product Description, Name, New Product Adaptability. Determan Home. 2007.
- Promotion. Marketing-Promotion objectives, offer, Response, PR, WWW, Direct Mail. Determan Home.
- Coca-Cola still world’s top brand. BBC News. 2005. Web.