The Coca-Cola Company
The Coca-Cola Company
The Coca-Cola Company
The company owns its anchor bottler in North America, Coca-Cola Refreshments. The
company's stock is listed on the NYSE and is part of the DJIA, the S&P 500 index, the
Russell 1000 Index, and the Russell 1000 Growth Stock Index.
HISTORY.
In 1886, pharmacist John Pemberton from Columbus, Georgia invented the original
Coca-Cola drink and sold it as a medicinal beverage. Pemberton's bookkeeper, Frank M.
Robinson, is credited with naming the products and creating its logo.
Robinson chose the name Coca-Cola because of its two main ingredients (coca leaves and
kola nuts) and because it sounded like an alliteration. John Pemberton had taken a break and
left Robinson to make and promote, as well as sell Coca-Cola on his own. He promoted the
drink with the limited budget that he had and succeeded.
In 1889, American businessman Asa G. Candler completed his purchase of the Coca-Cola
formula and brand from Pemberton's heirs. In 1892, the Coca-Cola Company was formally
founded in Atlanta by Candler. By 1895, Coca-Cola was being sold in every state in the
union. In 1919, the company was sold to Ernest Woodruff's Trust Company of Georgia.
ACQUISITIONS.
The Coca-Cola Company produces concentrate, which is then sold to licensed Coca-Cola
bottlers throughout the world. The bottlers, who hold an exclusive territory contracts with the
company, produce the finished product in cans and bottles from the concentrate, in
combination with filtered water and sweeteners. A typical 12-US-fluid-ounce (350 ml) can
contain 38 grams (1.3 oz) of sugar (usually in the form of high fructose corn syrup). The
bottlers then sell, distribute, and merchandise Coca-Cola to retail stores, restaurants, and
vending machines throughout the world. The Coca-Cola Company also sells concentrate for
soda fountains of major restaurants and foodservice distributors.
The Coca-Cola Company has on occasion introduced other cola drinks under the Coke name.
The most common of these is Diet Coke, along with others including Caffeine-Free
Coca-Cola, Diet Coke Caffeine-Free, Coca-Cola Zero Sugar, Coca-Cola Cherry, Coca-Cola
Vanilla, and special versions with lemon, lime, and coffee. Based on Interbrand's "best global
brand" study of 2015, Coca-Cola was the world's third most valuable brand, after Apple and
Google.In 2013, Coke products were sold in over 200 countries worldwide, with consumers
drinking more than 1.8 billion company beverage servings each day. Coca-Cola ranked No.
87 in the 2018 Fortune 500 list of the largest United States corporations by total revenue.
Coca-Cola is the world's leading soft drink maker and operates in more than 200 countries
around the world. It sells a variety of sparkling and still beverages. It generates 60% of its
revenue and about 80% of its operating profit from outside the United States. It has strong
brand recognition across the globe. According to business insider, approximately 94% of the
world population is aware of the red & white logo of Coca Cola.
MISSION, VISION & VALUES.
MISSION.
Our Roadmap starts with our mission, which is enduring. It declares our purpose as a
company and serves as the standard against which we weigh our actions and decisions.
● 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.
WINNING CULTURE.
Our Winning Culture defines the attitudes and behaviors that will be required of us to make
our 2020 Vision a reality.
VALUES.
Our values serve as a compass for our actions and describe how we behave in the world.
● Leadership: The courage to shape a better future
● Collaboration: Leverage collective genius
● Integrity: Be real
● Accountability: If it is to be, it's up to me
● Passion: Committed in heart and mind
● Diversity: As inclusive as our brands
● Quality: What we do, we do well
WORK SMART.
BE THE BRAND.
Segmentation helps the brand to define the appropriate products for specific customer group;
Coca Cola doesn’t target a specific segment but adapts its marketing strategy by developing
new products.
Similarly it uses a mix of undifferentiated & mass marketing strategies as well as niche
marketing for certain products in order to drive sales in the competitive market. Its Cola is
popular worldwide & is liked by people of all age groups while the diet coke targets niche
segment for people who are more health conscious.
Coca Cola uses competitive positioning strategy to be way ahead of its competitors in the
Non-alcoholic beverages market.
MARKETING MIX OF COCA COLA.
Coca-Cola is the brand with the highest brand equity. No doubt it has gone through the ups
and downs of business to reach that position. The marketing mix of Coca-Cola has been
changing over time with more and more products being added such that today it has 3300
products.
Since the invention of the nerve tonic beverage Coca-Cola by Dr. John Stith Pemberton in
1885 and the incorporation of The Coca-Cola Company by Asa Griggs Candler in 1892, the
American multinational beverage company has been known for its extensive marketing
efforts characterized primarily by remarkable advertising. Of course, there is more to the
marketing strategy of Coca-Cola than advertisements. This article provides a concise
discussion of the strategy and tactics employed by the company to market its products based
on the marketing mix model.
The company has the widest portfolio in beverage industry comprising of 3300 products.
Beverages are divided into diet category, 100% fruit juices, fruit drinks, water, energy drinks,
tea and coffee etc.
As per Nielson’s data, Coca-cola is the No.1 brand in sparkling beverages, juice, and retail
packaged water in 2010. Coca cola has its market presence around 200 countries. Coca-cola
brands in India are Fanta, Maaza, Limca, Sprite, Thums-Up, Minute Maid, Nimbu fresh,
Nested iced tea etc.
Coca Cola has a large product portfolio of 500 sparkling and still brands. It provides nearly
3,900 beverage choices. Its leading product Coca Cola is one of the world’s most recognised
and valuable brands. There are 21 billion dollar brands in its portfolio, of which 19 are
available in low or no calorie choices.
Here are some of the most known brands in Coca Cola’s portfolio:
● Coca-Cola: Most popular and highest selling soft drink in history and also one of the
most recognisable brands in the world.
● Fanta: Second oldest brand from Coca Cola, introduced in 1940, comes in orange
flavor.
● Diet Coke: Known as Coca Cola light in many markets. A sugar and calorie free soft
drink. Introduced in 1982.
● Coca Cola Zero: Launched in 2005, this zero sugar brand acquired the status of a
million dollar brand in 2007.
● Coca Cola life: Low calorie drink with cane sugar and Stevia leaf extract.
● Powerade: Drink for energy and hydration made with carbohydrates, electrolytes and
fluids.
● Powerade zero: Sports and fitness drink with electrolytes minus the calories.
● Del Valle: A premium line of juices and nectars sold mainly in Latin America and
Central America.
PRICE IN THE MARKETING MIX OF COCA-COLA.
Due to the availability of wide range products, the pricing is done according to the market
and geographic segment. Each sub-brand of Coca-Cola has different pricing strategy. Their
pricing strategy is based on the competitors pricing, Pepsi is the direct competitor to coke.
Beverage market is said to be an oligopoly market (few sellers and large buyers), hence they
form into cartel contract to ensure a mutual balance in pricing between the sellers.
Pepsi is the arch rival of Coca-Cola and the closest competitor in the beverages segment.
Both brands price their products competitively. Prices are not too high to go beyond the
average customers’ reach and nor too low to give an impression of low quality. Coca-Cola’s
pricing strategy is aimed at driving brand loyalty.
Moreover, due to the decreasing demand for the soda products, price competition between
Coca-Cola and Pepsi has gotten even more intense. The prices grow lower with larger size of
purchase. Bulk buyers of the product may have to pay significantly lower prices than the ones
buying single Coca-Cola products.
PLACE IN THE MARKETING MIX OF COCA-COLA.
Coca-Cola is the world’s most favorite brand and is available all over the world. The
distribution system of coca cola follows the FMCG distribution pattern. The effective
distribution network of coke has almost eroded the small and middle level players in the
market. In India they have captured even the rural market by extensive distribution and have
eroded the market share of Bovonto, Kalimark etc.
Coca Cola has an extensive beverage distribution system. Its products are sold in more than
200 countries across 6 operating regions including Europe, Latin America, North America,
Pacific, Eurasia & Africa. Coca Cola sells an average of 1.9 billion servings each day.
Traditionally, the company has relied on its bottling partners for the packaging and
distribution of its products.
As Coca-Cola notes, “While many view our Company as simply “Coca-Cola,” our system
operates through multiple local channels. Our Company manufactures and sells concentrates,
beverage bases and syrups to bottling operations, owns the brands and is responsible for
consumer brand marketing initiatives. Our bottling partners manufacture, package,
merchandise and distribute the final branded beverages to our customers and vending
partners, who then sell our products to consumers” (Coca-Colacompany).
Its bottling partners work closely with customers, including grocery stores, restaurants, street
vendors, convenience stores, movie theatres and amusement parks, among many others.
Together they execute localised strategies of Coca Cola company. These customers sell
Coca-Cola products to the final customers.
PROMOTIONS IN THE MARKETING MIX OF COCA-COLA.
Coca cola adopts various advertising and promotional strategies to create an increased
demand in the market by associating with life style and behaviour and mainly targeting value
based advertising. You are more likely to see a coke ad individualised for a particular festival
or in with a general positive message.
Coca cola uses CSR as its marketing tool to gain emotional benefits in consumers mind. The
current promotions through CSR include “Support my school” campaign with NDTV. It has
many brand ambassadors like Shahrukh Khan, Hrithik Roshan, South Indian Actor Vijay and
Trisha, Ghambir, Aamir khan etc and has signed contract recently with Imran khan.
It allows price discounts and allowances to distributors and retailers and uses various types of
sales promotions in order to push more products into the market. It employs both push
strategy through promotions and pull strategy through advertisements and campaigns.
Due to the intense competition in the soda industry the top brands spend much on advertising
to drive higher sales and revenue. Coca-Cola’s marketing expenditure in 2016 was $4 billion.
In 2018, the marketing expenditure grew to $4.1 billion. It utilises both traditional and
modern channels to promote its brand and products. Coca Cola launched its Taste the Feeling
campaign in 2016 which unites all of its brands. This one brand approach taken by Coca Cola
marks a significant shift from its previous marketing strategy.
Apart from TV ads and outdoor ad campaigns, the company serves its ads across the internet
and on social media. Its social media accounts are used to connect with its fans and followers
and for customer engagement. There are more than 1,250 promotional videos of Coca Cola
on its official YouTube channel.
SWOT of Coca Cola
Coca cola is a brand which is present in households, shops, hotels, offices, etc. You name it,
and the place would have heard of Coca cola. Coca cola has many products in its arsenal.
Here is the SWOT analysis of Coca cola.
1. Brand Equity – Interbrand in 2011 awarded Coca cola with the highest brand
equity award. Coca cola with its vast global presence and unique brand identity
is definitely one of the costliest brands with the highest brand equity.
2. Company valuation – One of the most valuable companies in the world, Coca
cola is valued around 79.2 billion dollars. This valuation includes the brand
value, the numerous factories and assets spread out across the world and the
complete operations cost and profit of Coca cola.
3. Vast global presence – Coca cola is present in 200 countries across the world.
Chances are, any country that you go to, you will find coca cola present in that
market. This vast global presence of coca cola has also contributed to the
building of the mammoth brand name.
4. 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. Amongst all beverages, Coke, Thums up,
Sprite, Diet coke, Fanta, Limca and Maaza are the growth drivers for Coca
Cola.
5. Fantastic marketing strategies – Coca cola unlike Pepsi always tries to win
peoples heart. Where Pepsi’s target is continuously changing, and is targeted
towards youngsters, Coca cola targets people of all ages. The targeting is also
done by celebrities who are well liked – for example – Amitabh Bacchan,
Sachin tendulkar, Aishwarya Rai, Aamir Khan etc
6. Customer Loyalty – With such strong products, it is natural that Coca cola has a
lot of customer loyalty. The products mentioned above like Coca cola and Fanta
have a huge fan following. People will prefer these soft drinks over others.
Because of the good taste of Coca cola, finding substitutes becomes difficult for
the customer.
7. Distribution network – Coca cola has the largest distribution network because
of the demand in the market for its products. On the other hand, due to this
successful distribution network, Coca cola has been able to command such a
high market presence.
1. Competition with Pepsi – Pepsi is a thorn in the flesh for Coca cola. Coca cola
would have been the clear market leader had it not been for Pepsi. The
competition in these two brands is immense and we don’t think Pepsi will give
up so easily.
2. Product Diversification is low – Where Pepsi has made a smart move and
diversified into the snacks segment with products like Lays and Kurkure, Coca
cola is missing from that segment. The segment is also a good revenue driver
for Pepsi and had Coca cola been present in this segment, these products would
have been an additional revenue driver for the company.
3. Absence in health beverages – If you watch the news, you would know that
obesity is a major problem affecting people nowadays. The business
environment is changing and people are taking measures to ensure that they are
not obese. Carbonated beverages are one of the major reasons for fat intake and
Coca cola is the largest manufacturer of Carbonated beverages. The inference is
that the consumption of beverages in developed countries might go down as
people will prefer a healthy alternative.
4. Water management – Coca cola has faced flak in the past due to its water
management issues. Several groups have raised lawsuits in the name of Coca
cola because of their vast consumption of water even in water scarce regions.
At the same time, people have also blamed Coca cola for mixing pesticides in
the water to clear contaminants. Thus water management needs to be better for
Coca cola.
Opportunities in the SWOT of coca cola
1. Raw material sourcing – Water is the only threat to Coca cola. The weakness of
Coca cola was the suspected use of pesticides or vast consumption of water.
However, the threat here is that water scarcity is on the rise. With the climate
changing, and regions of various countries facing scarcity of water, sooner or
later someone might raise fingers on beverage companies. Thus, Water sourcing
is an axe which can fall anytime on the head of Coca cola. If water is limited or
rationed, Coca cola can experience a major downfall in their revenue and
capacity of distribution. The same can affect its arch rival Pepsi as well.
2. Indirect competitors – Coffee chains like Starbucks, Café coffee day, Costa coffee are
on the rise. These chains offer a healthy competition to Coca colas carbonated drinks.
They might not be a big competition for Coke, but they do give a dent to its beverage
market. Similarly, health drinks like Real and Tropicana as well as energy drinks like
Red bull and Gatorade are stealing away the market share indirectly.
Competitive advantage in the Marketing strategy of Coca Cola
Coca Cola has competitive edge over its competitors in terms of Operations, Cost control,
Brand portfolio, Channel marketing, Collaborative customer relationship.
Operations – Coca cola has outsourced the bottling operation to the franchisee, FEMSA
which is the largest Bottling franchisee of the Coca-Cola trademark beverages in the world. It
helps the company in capturing important growth opportunities in under-developed
non-carbonated beverage segment and in strategic acquisitions by entering into agreements to
jointly acquire companies with The Coca Cola Company.
Cost control – Its diversified product portfolio, Outsourcing operations & economies of scale
helps it in cutting its operational cost & increase its profitability.
Strong Brand Portfolio – Company offers a powerful and wide portfolio of beverages to its
customers, and continuously explores promising beverage categories to capture growth in its
different markets. Its beverage portfolio consist of carbonated soft drinks, bottled water,
juices, orangeades, iso-tonics, teas, energy drinks, milk, coffee and even beer in some
markets such as Brazil.
Coca Cola’s trademark brand occupies a different position in BCG matrix based on the
demand & competitive position.
Thumps-up, Sprite, Fanta & Maaza are Stars as these brands have high market share but high
competition in their respective segment.
Kinley is question mark reason being low sales. Company is not able to distinctly position
Kinley due to the presence of lots of local players in the highly commoditized market
resulting in low sales.
The main brand Coca Cola is considered a cash cow because it has a single competitor in
Pepsi and has a fantastic presence across the world
Coke-diet, Tea & coffee brands are dogs since it’s not able to attract customers for this
segment and these are probably more long-term units and under establishment.
It uses several sales and distribution models depending on market, geographic conditions and
the customer’s profile:
(1) the pre-sale system, which separates the sales and delivery functions, permitting trucks to
be loaded with the mix of products that retailers have previously ordered, thereby increasing
both sales and distribution efficiency,
(2) the conventional truck route system, in which the person in charge of the delivery makes
immediate sales from inventory available on the truck,
(3) a hybrid distribution system, where the same truck carries product available for immediate
sale and product previously ordered through the pre-sale system,
(4) the telemarketing system, which could be combined with pre-sales visits and
Coca Cola is the one brand which is recognized by everyone around the globe. When we talk
about brand equity then it is its value & it’s about stories, memories, associations, and human
connections (although of course, these connections would have been very carefully and
deliberately engineered by talented marketers over many years and countless board
meetings).
This is something that Coca-Cola has been the master of for over 100 years. This equity is
derived from people’s willingness to pay a premium for the brand and an unwillingness to
accept substitutes. Coca-Cola’s marketing strategy has always been to associate happiness,
positivity and the good life with their products, & that’s how they are able to create high
TOMA (Top of mind awareness).
Big Giants in the Non-alcoholic beverages segment have similar strategy & objectives which
means innovation & creative marketing campaigns can help the companies to differentiate
from each other. Competition from the local players is the other major issue that company is
facing now days. Pepsi is the single largest main competitor of Coca-Cola having products
across the segments.
Non-alcoholic beverages market is ever-growing industry & with the advent of growing
Asian markets & developing nations the consumption will be higher also due to the changing
lifestyle, economic conditions & changing buying habits. In this industry customer have got
lots of options ranging from water to tea/coffee to soft drinks, so chances of customer
switching to another brand is high. The only way to differentiate products & retain customers
is the strong brand building, and creating pull in the market.
Customer analysis in the Marketing strategy of Coca Cola – Coca cola targets a mass market.
And the customer expectation is low price, great taste, convenience & accessibility and
various options to choose from.
https://www.coca-colaindia.com/about-us/mission-vision-and-values
https://www.marketing91.com/marketing-mix-coca-cola/
https://www.marketing91.com/swot-coca-cola/
http://www.coca-colacompany.com/our-company/the-coca-cola-system
http://www.coca-colacompany.com/careers/who-we-are-infographic
http://www.coca-colacompany.com/stories/taste-the-feeling-launch
http://www.businessrevieweurope.eu/marketing/856/Top-20-companies-with-the-biggest-adv
ertising-budget