Coca Cola Marketing Strategy - DOC

Document Sample
Coca Cola Marketing Strategy - DOC Powered By Docstoc
					Kalia Hymes, Amy Isom, Joshua O’Brien

   Busa 308: Marketing Principles

          Prof. M. Simpson
                     Table of Contents

Company Description………………………………………………………………3

Business Mission……………………………………………………………………3

Marketing Objectives……………………………………………………………...4

Industry Analysis…………………………………………………………………..5

SWOT Analysis……………………………………………………….……………6

Target Market………………………………………………………….…………...9

Marketing Mix………………………………………………………….………….10

Marketing Research…………………………………………………….……...….17

Organizational Structure and Plans………………………………………………19

Financial Projections…………………………………………………………...….21

Summary…………………………………………………………………….….….22

Sources Cited……………………………………………………………………....23




                                                         2
                                Company Description

       The Coca-Cola Company, founded in 1886, is ranked number 94 in the Fortune

500 and number one in the beverage industry (Fortune 2007). They own four of the top

five soft drink brands and serve over 6 billion consumers. Coca-Cola is headquartered in

Atlanta, Georgia but “approximately 74% of its products are sold outside the US” (Coca-

Cola Datamonitor, 2007). They recorded revenues of $24,088 million in 2006 and they

have an employee count of approximately 71,000 (Coca-Cola Datamonitor 2007).

       The Coca-Cola Company is one of the leading manufacturers, distributors, and

marketers of non alcoholic beverage concentrates and syrups. They produce non

alcoholic beverage concentrates and syrups which are sold to bottling partners. The

bottlers usually add carbonated water with the concentrates and sweeteners and then

bottle the product and sell it to wholesalers or retailers. Coca-Cola owns more than 400

brands in which they market for in over 200 different countries (Coca-Cola Datamonitor,

2007). Coca-Cola sells a variety of soft drinks, juices, sports drinks, teas, and water. They

operate in eight segments, but most of their revenues come from three of those segments.

Their three major segments are North America, South Asia and the Pacific Rim, and

Bottling Investments. Their five other segments include Europe; North Asia, Eurasia and

Middle East; Latin America; Africa; and Corporate. Coca-Cola also has the leading brand

(Coca-Cola Datamonitor, 2007).

                                   Business Mission

       Coca-Cola is passionate about their mission, vision, and values. They run their

company based on three things. Their company mission includes three major things:




                                                                                           3
“To refresh the world in body, mind, and spirit. To inspire moments of optimism

through our brands and our actions. And also to create value and make a difference

everywhere we engage” (Coca-Cola Company, 2006).

       Their vision is to maximize profits and returns to shareholders. Coca-Cola wants

to have skillful workers and inspire them to do the best that they can. They want Coca-

Cola to be an enjoyable place to work at and for employees to be motivated in coming to

work. The company likes to obtain a product line of beverages that satisfy the needs and

wants of consumers. Coca-Cola wants to build trusting relationships with their partners

and suppliers along the supply chain. Also Coca-Cola prides itself in making a difference

in their community and their many contributions that work to improve the environment.

The business decisions that Coca-Cola makes are guided by their values. Their main

values include: leadership, passion, integrity, accountability, collabo ration, innovation,

and quality (Coca-Cola Company 2006). Coca-Cola has remained successful by

maintaining strong values, visions, and mission.




                                Marketing Objectives

       Future growth for Coca-Cola will emerge from their focus shift towards the global

market as well as the health conscious market. They are implementing and continuing to

build on their global strategy (FrontPage, 2007). Coca-Cola would like to continue to

market to countries around the world outside of the United States. They are having

growth in emerging markets in Latin America, the BRIC, and Western Europe

(FrontPage, 2007). This will be their major focus in the future, because they feel this is

where their major growth opportunities lie.


                                                                                              4
         Consumers are moving towards a healthier lifestyle, which in turn is causing

Coca-Cola to expand their products to continue to meet their needs. They would like to

focus on providing juices, sport drinks, and water lines that will aim at the more health

conscious market. Coca-Cola has been performing trials on their Minute Maid Heart

Wise orange juice to prove that it does help lower cholesterol and improve health. Also

they are having trials for their Enviga green tea which can help boost metabolism. This

new market is huge and creates a lot of growth opportunity for Coca-Cola (Credeur,

2007). “The core of our business is healthy and it‟s poised to capture significant growth

over the coming years” (Credeur, 2007). Consumer behavior is changing therefore Coca-

Cola must adjust their marketing strategies and product lines to meet the consumers‟

needs.




                                   Industry Analysis

         The Coca-Cola Company falls in the beverage industry with many other

developing companies. Leading the beverage industry by generating revenues of $24,088

million dollars, Coca-Cola‟s closest competition in this industry is Coca-Cola Enterprises

and Anheuser-Busch. Others that fall into the industry include Pepsi Bottling, Molson

Coors Brewing, Constellation Brands, Pepsi Americas, and Brown-Forman (Fortune

2007).

         The beverage industry is moving toward the more health conscious consumer.

The market is shifting from soft drinks to juices, sport drinks, and water products. To

remain competitive Coca-Cola must also enter into this market and follow the healthier

trends. “ In many European countries, the increasing consumer trend toward a healthier


                                                                                            5
lifestyle continues to grow demand for functional beverages that offer physical or mental

well being, lower calories and other added values” (Fuhrman, 2007). Consumers‟ value

products that are going to help them live a healthy lifestyle and feel better both physically

and mentally.



                                    SWOT Analysis

Strengths

       Coca-Cola has a lot of strength in their marketing plan and business. They are the

world‟s leading brand name, and they have a large scale of operations, and have

continuing revenue growth in all of their three segments. Coca-Cola‟s three major

segments are Latin America; East, South Asia, and Pacific Rim; and Bottling

Investments. These are the segments that earn the highest revenues. Each of these

segments continuously grows in revenues each year. The revenues earned in these

segments have helped The Coca-Cola Company to grow and expand (Coca-Cola

Datamonitor, 2007).

       Coca-Cola‟s brand name is valued higher than their biggest competitor, Pepsi.

Business Week valued Coca-Cola at $67,000 million and Pepsi at only $12,690 million.

The brand of Coca-Cola is known globally and allows the company to enter new and

emerging markets. Having a strong brand name also allows them to expand their

company by adding products such as Cherry Coke and Coke with Lemon, and allowing

them to meet different consumers‟ needs. Coca-Cola owns the brand names of Coca-

Cola, Diet Coke, Sprite, and Fanta which are four of the leading brands in soft drinks

(Coca-Cola Datamonitor, 2007).



                                                                                            6
       Coca-Cola, with large scale operations, is the leader in manufacturing,

distributing, and marketing nonalcoholic beverage concentrates and syrups. Selling in

200 countries, Coca-Cola owns 32 beverage concentrate manufacturing plants. They also

own bottle water production and beverage facilities. The company‟s large-scale of

operation allows it to feed upcoming markets with relative ease and enhances its revenue

generation capacity” (Coca-Cola Datamonitor, 2007).

Weaknesses

       Coca-Cola has three major weaknesses that occur internally in the company, they

include: negative publicity, poor performance in North America, and decrease in cash

from operations. In 2006, Coca-Cola was accused of selling a product with pesticide

residues in India and received negative publicity. These residues contained harmful

chemicals that could damage the nervous and reproductive systems and could potentially

cause cancer. Coca-Cola was plagued with harmful publicity much like this scenario

throughout the year. This type of publicity can affect their brand image and decrease

demand for their products (Coca-Cola Datamonitor, 2007).

       Coca-Cola focuses on North America as their major target market; therefore it is

important for them to have a good performance for the target market. In 2006, Coca-

Cola did not perform well and its market growth ceased in North America. The company

actually got worse. If this poor performance continues, it could affect the overall

company‟s growth in the future and could allow their competito rs to surpass them (Coca-

Cola Datamonitor, 2007).

       Coca-Cola had a decrease of 7% in cash flows from operations in the year 2006.

This affected the company by reducing the amount of funds available for Coca-Cola to



                                                                                           7
reinvest in the company (Coca-Cola Datamonitor, 2007). Coca-Cola must then finance

their growth with debt which makes them vulnerable to interest rates.

Opportunities

       Major opportunities for growth for Coca-Cola include acquisitions, the bottled

water market, and the growing Hispanic population in the United States. This growing

demographic segment gives Coca-Cola an opportunity to try and reach new consumers

and expand their product lines. Some acquisitions of the Coca-Cola Company are Kerry

Beverages Limited in 2006 which is headquartered in Hong Kong. By acquiring Kerry

Beverages Limited Coca-Cola gained control over distribution and manufacturing joint

ventures in nine major Chinese provinces (Coca-Cola Datamonitor, 2007). They also

acquired Apollinaris in Germany, which sells sparkling and mineral water. Coca-Cola

also took over TJC Holding, a bottling company located in South Africa. They even

acquired companies in Australia and New Zealand. This enabled Coca-Cola to have a

strong hold on the global market, which as a result helped their international operations

grow and get stronger. It also gives them an opportunity for growth and to enter into new

markets.

       The increasing health conscious market is just one of the new markets that Coca-

Cola has shown a growing interest in, like the bottled water market. “Bottled water is one

of the most fast-growing segments in the world‟s food and beverage market owing to

increasing health concerns (Coca-Cola Datamonitor, 2007).

Threats

       Even a large and successful company like Coca-Cola has external threats. Three

of their major threats are intense competition, dependence on bottling partners, and slow



                                                                                            8
growth of carbonated beverages. The nonalcoholic beverage industry is highly

competitive, leaving Coca-Cola with many competitors in their industry. Their largest

ones are PepsiCo, Nestle, Cadbury Schweppes, Groupe Danone, and Kraft Foods. This

intense competition influences Coca-Cola and their strategies. Key aspects that are

affected are pricing, advertising, sales promotion programs, product inno vation, and

brand and trademark (Coca-Cola Datamonitor, 2007).

       The high dependence Coca-Cola has on their partners and suppliers makes them

vulnerable. Most of the revenue that Coca-Cola generates comes from selling

concentrates and syrups to bottlers, in which they have no ownership control. These

distributors and bottling partners make their own business decisions and Coca-Cola has

no say in the choices they make. Not having control over a major aspect of their business

is a major threat. (Coca-Cola Datamonitor, 2007).



                                    Target Market

       As Coca-Cola‟s mission statement states it wants to “refresh the world” (Coca-

Cola Company, 2006). Therefore the company's target markets are any and all

consumers that have a thirst that demands satisfaction. However, there are some brands

that target specific consumers. For example, Coca-Cola‟s PowerAde is a sports drink that

is aimed at athletic men and women, where as its diet soft drinks are targeted at

consumers who are of older age (Clark, 2005). This type of marketing approach is

referred to as market segmentation. Market segmentation is defined as “the process of

dividing a market into meaningful, relatively similar, and identifiable segments or

groups” (Hair, Lamb, & McDaniel, 2006, p. 212). Two ways in which Coca-Cola



                                                                                         9
segments its target market are by demographic and geographic segmentation. Before

1960 the Coca-Cola Company only had one beverage aimed at the entire soft drink

market (Hair, Lamb, & McDaniel, 2006, p. 212). Currently Coca-Cola offers a wide

range of products including coffee, tea, sports drinks, energy drinks, water and their well-

known Coca-Cola soft drinks (Coca-Cola Datamonitor, 2007).


       Market segmentation allows the Coca-Cola Company to market to people with

different product needs and preferences. For example, in the past year the Coca-Cola

Company felt like they needed to focus on the need that their products satisfy for their

consumers. They came out with a beverage portfolio based on “seventeen need states” of

their consumers. Some of these included relaxation, hydration, weight management, and

heart health (MacAuthor &Thompson, 2006). Therefore the Coca-Cola Company‟s

target market strategy is to segment the entire soft drink market to better understand and

design marketing mixes that specifically matched with the characteristics and desires of

each segments.


                 Marketing Mix: Product, Place, Price, Promotion


Product:


       In order for an organization to be successful it needs to have a well-defined

marketing mix. The marketing mix consists of the four P‟s; produc t, place, price,

promotion (Hair, Lamb, & McDaniel, 2006, p. 48). Product is defined as “everything,

both favorable and unfavorable, that a person receives in exchange” (Hair, Lamb, &

McDaniel, 2006, p. 48). The Coca-Cola Company‟s products consist of beverage


                                                                                           10
concentrates and syrups, with the main product being the finished beverages (Coca-Cola

Datamonitor, 2007). Coca-Cola‟s products can be viewed as both business and consumer

products. Ultimately, the main goal of the Coca-Cola Company‟s is to satisfy a

consumer‟s personal want, which is the definition of consumer products (Hair, Lamb, &

McDaniel, 2006, p. 248). The type of consumer product the Coca-Cola Company creates

is convenience product. Convenience products normally require a wide distributio n in

order to sell sufficient quantities to meet profit goals (Hair, Lamb, & McDaniel, 2006, p.

285). In addition, the Coca-Cola Company often pays a certain amount to retail stores to

resell their product. Therefore the Coca-Cola Company products can be considered a

business product.


       The Coca-Cola Company has a fairly large product mix which contains about 400

brands, including diet and light beverages, waters, juice and juice drinks, teas, coffees,

energy, and sports drinks (Coca-Cola Datamonitor, 2007). The Coca-Cola Company has

increased its product mix width since 1960. This enabled the Coca-Cola Company to

spread risk across many product lines rather than depend only on one and to help

generate sales and boost profits within its organization (Hair, Lamb, & McDaniel, 2006,

p. 287). The Coca-Cola Company also packages its products different sizes to appeal to

certain consumers (Hair, Lamb, & McDaniel, 2006, p. 286). For example, Diet Coke is

available in twelve-ounce or even six-ounce cans and various plastic containers, ranging

from two liters to twenty ounces (Coca-Cola Company, 2006).


       The Coca-Cola Company has increased its product mix by product line extensions

as well as creating new products. The Coca-Cola Company has extended its product line



                                                                                             11
by introducing a variety of drinks (“Will New Cokes”, 2006). These include Vanilla

Coke, Cherry Coke, Cherry Vanilla Coke, Coke Plus and many more to attempt to meet

the needs of all of its‟ consumers. The Coca-Cola Company also increases its product

mix and broadens its market by the innovation of new juice and sport drink products

(Marcial, 2007). This fairly large product mix enables the Coca-Cola Company to satisfy

the needs of their consumers‟ thirst, whatever it may be. This type of product mix allows

the Coca-Cola Company to achieve its mission statement in which it states that it wants

to “refresh the world” (Coca-Cola Company, 2006).


Place/Distribution:


       Another crucial part of the marketing mix is place and distribution of an

organizations product. Place and distribution strategies are “concerned with making

products available when and where customers want them” (Hair, Lamb, & McDaniel,

2006, p. 48). The Coca-Cola Company states in its mission statement that it wants to

offer its products to all consumers globally (Coca-Cola Company, 2006). The Coca-Cola

Company uses intermediaries (i.e. retailers and distributors) instead of directly selling to

distribute its products worldwide (Coca-Cola Datamonitor, 2007). The Coca-Cola

Company also uses intensive distribution strategies to make sure their products can be

available everywhere. One low profile type of retailing that the Coca-Cola Company does

to increase its distribution of its product is the use of automatic vending machines. These

can be found in a number of places, such as schools and concert venues (Hair, Lamb, &

McDaniel, 2006, p. 411). Since their product is a convenience product, it requires a wide

distribution in order to meet profit goals (Hair, Lamb, & McDaniel, 2006, p. 285).



                                                                                           12
         Recently the Coca-Cola Company has focused more on their global strategy to

help them increase their growth. Much of this growth is coming out of Latin America,

the BRIC, and Western Europe (“Innovation, acquisitions”, 2007). Currently many

Europeans are beginning to be more worried about their health, which has increased

Coca-Cola‟s Diet Coke and Coke Zero sales (Fuhrman, 2007). In addition, the Coca-

Cola Company is in many other countries including India that are in the growth stage of

the product life cycle (“Marketing: New products”, 2007). The Coca-Cola Company‟s

growth in these areas are caused by their improved marketing to consumers, better

relationships with bottlers, their “live happily” campaign in 200 markets, and the launch

of Coca-Cola Zero. They also launched Minute Maid juice in India as well as China and

Korea (“Marketing: New products”, 2007). Their innovation and introduction of new

products as well as their “winning culture” has helped them begin to grow again

worldwide.


Price:


         Price of the product or service is another important part of the marking mix. Price

is defined as “what a buyer must give up to obtain a product” (Hair, Lamb, & McDaniel,

2006, p. 49). Price is the quickest and most flexible element to change in the marketing

mix. The prices of the Coca-Cola's Companies products vary according to the brand and

the size in which they come in (Coca-Cola Company, 2006). The Coca-Cola Company's

products are sold by a wide variety of distributors and retail stores, such as convenient

stores and gas stations, as well as vending machines (Coca-Cola Datamonitor, 2007). The

distributors and retail stores that the Coca-Cola Company deals with often implement



                                                                                            13
their own pricing strategy (Coca-Cola Datamonitor, 2007). Gas stations and convenient

stores usually sell Coca-Cola products at a fixed price. However, the retail outlets use a

variety of pricing methods and strategies when selling Coca-Cola products (Coca-Cola

Datamonitor, 2007). There is often competition pricing of the Coca-Cola products and

prices are set around the same level as its competitors. In addition there are also

psychological pricing strategies that are used to make consumers perceive that the

products are cheaper than they really are.


Promotion:


       The fourth aspect of the marketing mix is promotion of a product. The promotions

role in the marketing mix is to “bring about mutually satisfying exchanges with target

markets by informing, educating, persuading, and reminding them of the benefits of an

organizations product” (Hair, Lamb, & McDaniel, 2006, p. 49). Since the Coca-Cola

Company operates on a global scale, their promotional strategy needs to consider the

external environment in which their products are. These external environmental factors

include culture, economic and technological development, political structure,

demographic makeup and natural resources (Hair, Lamb, & McDaniel, 2006, p. 77). For

example, the Coca-Cola Company promoted its new Coke Zero in Australia differently

than it did in the United States because of the different external environmental factors

associated with that segment (Alarcon, 2007). In addition, the Coca-Cola Company often

has to adapt its advertisements in different cultures. For example, an ad in Singapore

portraying teenagers careening down a store aisle on a grocery cart was perceived as too

rebellious (Hair, Lamb, & McDaniel, 2006, p. 129). The ultimate goal of any promotion



                                                                                           14
is to get someone to by a good or service. There are four main aspects of the promotional

mix that integrate together to create a competitive advantage for an organization. The

four aspects of the promotional mix are advertising, public relations, sales promotion, and

personal selling (Hair, Lamb, & McDaniel, 2006, p. 411)


       The advertising part of the promotional mix allows the organization to reach the

masses with its product. The Coca-Cola Company was built heavily on advertising and

marketing investments. Today the Coca-Cola Company spends most of its money on

advertising that maintains the brands awareness (Hair, Lamb, & McDaniel, 2006, p. 468).

Thus advertising is a main source in increasing consumer awareness. The Coca-Cola

Company uses many forms of advertising, from TV advertisements to magazines and

billboards (Steinberg & Vranica, 2004). One target segment that the Coca-Cola

Company is having trouble trying to advertise to is the more outdoor, health conscious

and environmentally friendly consumer (Steel, 2007). The advertisers are unsure how to

advertise to them in a “green” fashion where the advertisement achieves its goals of

persuading, informing, and reminding as well as being environmentally friendly.


       Public relations part of the promotional mix helps maintain an organizations

image and educate consumers (Hair, Lamb, & McDaniel, 2006, p. 444). Many

organizations hire outside professional help to deal with public relations within an

organization. Public relations are “the element in the promotional mix that evaluates

public attitudes identifies issues that may elicit public concern, and executes programs to

gain public understanding and acceptance” (Hair, Lamb, & McDaniel, 2006, p. 441).

The type of public relations tools that the Coca-Cola Company uses widely are product



                                                                                          15
placements and sponsorships (Steinberg & Vranica, 2004).


       The Coca-Cola Company often uses is a spokesperson to appeal to the younger

more youthful (Hair, Lamb, & McDaniel, 2006, p. 163). An example of this can be seen

in China where the Coca-Cola Company has increased advertising containing younger

Chinese celebrities to help inform, persuade, and remind their target segment (Flagg,

1999). The Coca-Cola Company also uses publicity to try and create a good company

image. An example of this is when the Coca-Cola Company invested 60 million dollars

in creating a recycling plant in South Carolina. By creating this plant the Coca-Cola

Company hopes to help eliminate carbon dioxide emissions and recycle a mast majority

of their plastic bottles (Truini, 2007). This effort in trying to help reduce the carbon

dioxide emissions strengthens the Coca-Cola Company image of wanting to create value

and make a difference everywhere they go.


       Personal selling allows the organization to build relationships with their

consumers or other business associates (Hair, Lamb, & McDaniel, 2006, p. 444).

Personal selling is defined as “direct communication between a sales representative and

one or more prospective buyer” (Hair, Lamb, & McDaniel, 2006, p. 443). Personal

selling in the Coca-Cola Company often is done in a business-to-business fashion. An

example of this is seen when the Coca-Cola Company was trying to boost their sales in

North America by forming alliances with Nestea to create coffee and tea drinks (McKay

& Corderio, 2007). This demonstrates how the Coca-Cola Company uses personal

selling in a business-to-business atmosphere to provide its‟ consumers with a larger

variety of products that can satisfy their need.



                                                                                           16
        The Coca-Cola Company also uses sales promotions to increase their

effectiveness of their promotional efforts. The essence of sales promotion is to help

stimulate a purchase (Hair, Lamb, & McDaniel, 2006, p. 444). Some examples of sales

promotions that the Coca-Cola Company uses are coupons and rebates and are used

frequently because they are more likely to influence customers‟ buying decision (Hair,

Lamb, & McDaniel, 2006, p. 442). Another type of sales promotion that the Coca-Cola

Company is currently using is their coke rewards points promotion. “My Coke Rewards”

is customer loyalty marketing campaign from the Coca-Cola Company. Customers enter

codes from specially marked packages of Coca-Cola products into a website. These codes

are converted into virtual "points" which can in turn be redeemed for various prizes or

sweepstakes entries (Coca-Cola Company, 2006). The ultimate goals and tasks of

promotion mix are to inform, persuade, and remind the target audience.


                                 Marketing Research

       The Coca-Cola Company is a mass company with many marketing channels.

They are widely distributed throughout the world. Many marketing decisions they face

are backed with data or conflicts that result in them creating a fancy or reasonable

solution. Even though Coca-Cola does an excellent job of quenching one‟s thirst, they

sometimes have trouble understanding what regions of the world to emphasize marketing

certain products towards.

       To stay competitive, Coca-Cola conducts marketing research to try and better

understand their consumers. Coca-Cola creates products and services that will help fit

into the needs and wants of their marketplaces. They have found that people expect more

from their beverages. To try and fill this desire Coca-Cola has developed the Beverage


                                                                                          17
Institute For Health and Wellness. This institute develops and tries new product ideas that

can contribute to their product line. In additions, “…the Institute works with the China

Academy of Chinese Medical Sciences to research the active ingredients in Chinese

medicinal beverages and soups for the potential development of new beverages” (The

Coca-Cola Company Annual Review, 2006). Coca-Cola wants to be able to keep their

market alive and constantly drinking their line of refreshments, so they continue to do

research that will benefit their consumers, as well as being potential profits for the

company.

       Coca-Cola within the last decade has been slowly grasping the idea of introducing

and emphasizing products that may not be profitable in certain regions to other cultures

where they may find value in such a product. For instance, Coke Zero is a product that

carries no carbohydrates or calories and was not quite meeting the expected profits in the

United States, but Coca-Cola started to advertise it more in Europe to areas that to enjoy

it. This region seemed more concerned about their health and well being, which

contributed to Coke Zero becoming more of a profitable product.

       Coca-Cola also develops interesting marketing techniques such as business to

business strategies to make their products more appealing to the younger generations.

According to marketing research, younger generations will pay more attention to

consumer products when they are advertised in a modern and „hip‟ way. For example,

Coca-Cola united with iTunes, so that whenever someone purchased a Coca-Cola product

they would receive free songs to promote both products (Fuhrman, 2007).Since in

younger generations are very music oriented. This relationship proves to be effective in

promoting their products and attracting to the youth.



                                                                                           18
       Even though Coca-Cola has interesting ways to promote their products, they need

to find an effective way that will sell and promote their whole product line. With more

marketing research, Coca-Cola is now being scrutinized for selling their product in public

schools. Upset parents and school faculty see the carbonated drinks as contributing to the

nation‟s obesity. The ban limits the company to selling products in schools to children

less than twelve years old. The company has also agreed to only advertise healthier

products towards this targeted market.

       A solution to this could be that Coca-Cola should input their marketing skills to

other products, as well. In addition, “The soft drinks giant would do better to concentrate

its advertising efforts on newer products with greater growth potential” (Datamonitor).

With the Classic Coke, being one of the most popular carbonated drinks in the world.

Coca-Cola could try and promote their other products that would acquire to different

tastes. Coca-Cola could put more efforts towards their Dasani, Inc. brand, known for their

bottled water. Bottled Water is a non carbonated drink that is becoming increasingly

popular and more of a competition towards the carbonated and other drinks.




                       Organizational Structure and Plan

       Coca-Cola implements an organizational strategy that better involves the

employees and customers. The ultimate goal of Coca-Cola‟s structure is to continually

build customer relationships. Coca-Cola likes to have a flexible organizational structure

that will be compatible with the market environment. Since 2006, the market has bee n

seen as a complex environment and to help fix this problem, Coca-Cola conducted a

thorough company analysis through their departments and segments. They assembled a


                                                                                           19
diverse, multi- functional executive group mix from separate countries and divisions.

They mixed these executives from the organizational levels and created a new business

model that would accommodate to the centralized as well as local Coca-Cola divisions.

       Coca-Cola claims that the impacts and benefits of this new business model are

already showing improvements. For example, “Among our results, we improved our

efficiencies throughout the supply chain, grew our volumes of single-serve presentations,

and increased our EBITDA…” (The Coca-Cola Company Annual Review, 2007). Coca-

Cola has been making new improvements all over the globe for their operating segments.

       The eight operating segments in the Coca-Cola empire: North America; Europe,

North Asia, Eurasia and Middle East; Latin America; Africa; East and South Asia, and

the Pacific Rim; Bottling Investments and Corporate. Then each of these regions is

broken down into smaller segments. The Coca-Cola segments work together as well as

dependent from each other to fit their demographic segments. But all groups prove to be

successful of share the similar approach and idea to operating: to create happy consumers

through their products.

       Recently in 2006, Coca-Cola decided to move the operating group headquarters to

Johannesburg, South Africa from its previous home in the United Kingdom. This enabled

the company to be closer to more potential and current business, and be able to expand

their empire through Africa. They also opened a new office in Cairo, which helped

increase the products volume sale in that area by 23 percent (The Coca-Cola Company

Annual Review, 2006). Coca-Cola‟s repositioning and structure allows them to be more

intact with their consumers and business.




                                                                                         20
                                 Financial Projections

       Coca-Cola has had an extremely successful year with improving the image of the

company, introducing new product lines, acquiring companies, and increasing their

products profitability from around the world. Coca-Cola expects to see a continue rise in

profits through the next year. Even though the rising costs of commodities pose a threat,

Coca-Cola will still prove to be profitable.

       With an upcoming year of hopefully new promising products, Coca-Cola might

be looking at their lines of bottled water, juices, and sports drink to bring in most of the

revenue due to their increasing popularity and consumer demand. The company‟s top

sellers in 2006 were their sparkling beverages, juice and water products. From 2006 to

2007, the net income per share has already risen 2.6%. This increase is just the beginning

for the company which shows extreme efforts towards the growth of the company. Coca-

Cola will continue to expand its empire throughout the world.

       With already being sustainable in China and successful in India, Coca-Cola‟s

profit will only increase. For instance, Coca-Cola is set to switch its focus to the China

market in an effort to sustain growth. The company said that with current economic

growth continuing apace, China should be its third biggest market by 2008 (Coca Cola

Looks to China For Future Growth, 2004). China is a very profitable segment for Coca-

Cola and will only continue to contribute to increased profits.

       With excellent resources and planning, Coca-Cola can only bring in more

consumers. The company‟s financial future projections are looking promising and the

company‟s profits will continue to rise with more consumers drinking their products daily

world wide.



                                                                                               21
                                       Summary

       The Coca-Cola Company demonstrates unique traits and strategies. Not only do

they serve the world with quality products ranging for any type of taste, but they

contribute to the well-being and restoration of the world. Coca-Cola proves to be a

company with goals other than to maximize profits. They have brought to much needed

countries resources to the people and children. From funding institutions that will teach

children how to read to reforestation and building recycling plants, Coca-Cola proves to

be a societal-oriented company.

       Coca-Cola creates their beverages to fit many thirsty consumers‟ needs and

desires. Always coming up with interesting drink inventions and marketing strategies, the

company will only continue to grow and expand their empire through the world with new

products. Coca-Cola follows their mission statement through the end, with illustrating

their constant improvements and innovations for their products, consumers, and the

world‟s environment.




                                                                                            22
                                   Sources Cited

Alarcon, Camille. (2007, January). Coke grows from zero to hero. B & T Weekly, p. 6.
       Retrieved October 5, 2007, from ProQuest ABI/INFORM Trade and Industry
       Database (Document ID: 1212075161).


Clark, Nicola.(2005, September). PowerAde eyes feminine appeal. Marketing, p. 16.
       Retrieved October 5, 2007, from Business Source Premier Database (Document
       ID: 18542362).

Credeur, Mary Jane. (2007, August). Coca-Cola goes on a health kick:MARKETPLACE
      By Bloomberg. The International Herald Tribune, Finance pp. 12. Retrieved
      October 5, 2007, from Lexis Nexis @ Academic database.


Coca-Cola Company, The. (n.d.). Retrieved October 5, 2007, from Datamonitor
      Company Profiles Authority database.


Coca-Cola Company, The. (n.d.). (2006, December) The Coca Cola Company. Retrieved
      October 5, 2007, from http://www.thecoca-colacompany.com/ourcompany/
      mission_vision_values.html

Coca-Cola Company, The. (n.d.). Retrieved October 5, 2007, from Lexis Nexis Corporate
      Affiliations.

The Coca-Cola Company 2006 Annual Review. (2006). Atlanta: Author.


Flagg, Michael. (1999, November 29). Pepsi Siphons Off Some of Coke's Lead In China
       by Learning to Pick Its Battles. Wall Street Journal (Eastern Edition), p. B,
       26:1. Retrieved October 10, 2007, from Wall Street Journal database. (Document
       ID: 46693429).


Fortune 500( 2007). Retreived October 5, 2007, from
       http://money.cnn.com/magazines/fortune/fortune500/2007/full_list/index.html


FRONT PAGE: Innovation, acquisitions put Coke o n high growth path. (2007, October).
     Businessline,1. Retrieved October 10, 2007, from ABI/INFORM Trade &
     Industry database.




                                                                                       23
Fuhrman, E. (2007, September). Western Europe: A mature market. Beverage Industry,
      98(9), 24-26. Retrieved October 10, 2007, from Business Source Premier
      database.


Hair J.F., Lamb C.W., & Mcdaniel C. (2006). Marketing, 9e. Manson Ohio: Neil
        Marquardt.


MacArthur, Kate and Thompson, Stephanie. (2006, November). Pepsi, Coke: We satisfy
      your 'need states'. Advertising Age, 77(48), 3,23. Retrieved October 10, 2007,
      from Research Library database.


Marcial, G. (2007, September 10). Coke Sparkles Again. Business Week, Retrieved
       October 9, 2007, from Business Source Premier Database.

MARKETING: New products, consumer focus put fizz back in Coke. (2007, October).
    Businessline,1. Retrieved October 10, 2007, from ABI/INFORM Trade &
    Industry database.


Steel, Emily. (2007, October 2). Taking Green Message to Great Outdoors. The Wall
        Street Journal, pp. B9.


Truini, J. (2007, September 17). Beverage maker plans biggest plastics plant. Waste
        News, 13. (10), 4-4. Retrieved October 9, 2007, from Business Source Premier
        database.


Will New Cokes Carry Flavour? (2006, May). The Grocer. Retrieved October 9, 2007
       from Lexis Nexis Academic.




                                                                                       24

				
DOCUMENT INFO
Description: Coca Cola Marketing Strategy document sample