Case Study: Coca-Cola

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Contents to Discuss
Introduction Facts and figures Coke in India Marketing strategy Corporate social responsibility SWOT analysis Questions to be discussed
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Introduction
Coca cola is the most ubiquitous brand in history Each day, people in 200 countries around the World drink some 1.2bl 8 ounce servings Coke owns four of the top five soft-drink brands (CocaCola, Diet Coke, Fanta, and Sprite). Coke started in 1883, have kept its brand relevant for over 100yrs.
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The Coca-Cola Company

Coca Cola, created by John Pemberton Registered in 1887; in Atlanta, Georgia; Coca Cola Corporation in 1888; Sold the syrup mixed with fountain water

as a tonic for mental & physical disorder; Hq. in Atlanta, Georgia; Asa D. Candler bought the Coca-Cola formula
for $2300.

Bottling Operations in 98 Countries; Local Operations over 200 Countries Added Carbonation, & aggressive marketing
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Asa Candler strategy

To gain new customer he printed coupons and free samples To rewarded the distributors for promoting coke He hired the first celebrity Hilda Clark in 1890s

Cont
During world war II coke became the official drink for the soldiers Coke customized its product as well the ad as per the local demand of the consumer Coke also sells a wide range of different flavored sodas in different countries Coke also launched a beer flavored beverage in japan
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Cont
Coke now gets two-thirds of its revenue from outside U.S It is easier to name the countries where coke is not available Cuba, Myanmar and Syria Coke remains the top brand in business weeks Global Brand Scorecard once again in 2003 Coke is diverting its money on ads from TV ads to more experiential activities
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Cont
Keeping in mind their core values coca cola strives to make its ads fresh and relevant As coca colas chairman Douglas daft stated Coca cola is arguably the strongest and most pervasive marketing and distribution system in the World
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Facts and figures

Coca cola headquarters are in Atlanta, Georgia, U.S TCCC is the largest manufacturer, distributor and marketer of nonalcoholic beverage concentrates and syrups in the world

Its revenue stood at $24bl in 2006 Net income of the co: was over $5bl in 2006
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Coke in India
1970: Coke entered Indian market & was termed as Coke left as it wasnt willing to Leader; the Market
reveal its formula to Government

Indias principles: Non-Violence & Self Reliance;

Government notified Self Reliance: Economic Independence; Coke to reduce Public Sector; Many industries were restricted to its equity stake under FERA

1977: Coca-Cola had to exit Indian Market;

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Parles Entity: 1980 Campa Cola, Thumps up, Gold Spot, Limca, Coca Cola India Mazaa, Citra emerged

1990 7000 Local Employees policy & Pepsi entered India; Indias liberalization
1993 Coke re-entered &1993 2003: Brands; From acquired Parle Coke turned into an absolute market leader 27 Wholly & 17 Franchisee Coca-Cola invested Bottling Operations; Owned more than overnight!!! Coke acquires Cadbury Schweppes Product 1999 US $1 billion in India; Range;
Network of 29 contract packers 2000 Launched Kinley water brand; to manufacture Cokes products 2001 Commenced Shock energy drink & Sunfill;

2002

400 tests for quality control Introduced Georgia Coffee & Tea;
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Coca-Cola India Brands

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The Most Powerful Brand

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The Most Powerful Brand: 2003

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The Most Powerful Brand: 2004

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The Most Powerful Brand: 2005

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Coca-Cola is the Market Leader...

July 22nd 2005

Coca-Cola still world's top brand:

Coca-Cola has been named the world's top brand for a 4th consecutive year in a survey by consultancy Interbrand.
http://news.bbc.co.uk/1/hi/business/4706275.stm
Coca-Cola $67.5bn (US)

Microsoft IBM General Electric Intel Nokia -

$59.9bn (US) $53.4bn (US)

$50bn (US) $35.6bn (US) $26.5bn (Finland)

Disney McDonald's Toyota Marlboro -

$26.4bn (US)
$26bn (US) $24.8bn (Japan) $21.1bn (US)
17 Source: Interbrand

December 07, 2005

Coca-Cola: A Fortune 500 company in India

Coke = leading player in the Indian beverage market with a 60 % share = CSD segment, 36 % share = Fruit drinks segment & 33 % share = Packaged water segment;
http://www.ibef.org/artdisplay.aspx?cat_id=447&art_id=6807

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Source: ORG

Indian carbonated soft drinks market: Market share of Coca-Cola & Pepsi;

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Corporate Social Responsibility

Improving the quality of life in which they operate; Environment (Water, Waste Management initiative); The Coca-Cola Africa Foundation to combat spread of HIV/AIDS; The Coca Cola Foundation focuses on higher education Build strong communities & enhance individual opportunity;
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Question- 1
What have been the key success factors for Coca- Cola 1. Marketing 2. Innovation 3. Globalization

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Marketing
The pioneers of advertisements techniques and styles. Coca cola through campaigns has developed an image which people associate with good times. They rope in big celebrities for promoting their products. Coke try to depict themselves as local brand. Time to time, they keep on launching new promotional activities. They are one of the regular sponsors of large scale events.
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Marketing
One of their marketing strategy was to capture fountain sales at restaurant such as McDonalds, Dominos Pizza. Coca cola is also spending heavily on internet advertising, recently signed $100 million 3 year deal with AOL for cyber ads. Coca cola was 1st sponsor of Olympic games in 1928 and has been sponsor ever since. Since 1978 coca cola has sponsored each FIFA world cup.
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Innovations
They have survived in ever-changing market by innovating and delivering new products. Coca cola shifted from core products to total beverage company The offering includes Cola, coffee, mineral water, tea, juices, energy drinks, low-calorie drinks 50 years ago, coca sold only one product coca cola classic. Coca-Cola offers nearly 400 different products in and is still dominating the beverage industry
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Innovations
Coca cola developed the 1st diet carbonated soft drinks, called Tab. More recently launched Minute Maid, the 1st orange juice to contain plant sterols which help in reducing cholesterol. Has recently signed 10 year deal with Bravo foods to produce and distribute vitamin enriched flavored milk drinks.
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Globalization
Coca is available in almost 200 countries This has helped coca cola gain recognition and develop into a global brand. It is recognized by 94% of the worlds population.

Coca cola gets more than 2/3 or its revenue from outside US.
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Cont
The global success of Coca Cola is termed as Coca-Colonization. Coca-Cola has established its factories in many countries. The mass production due to globalization has helped coke reduced its cost thus offering cheaper price to its customers. Coca-Cola has used the power of global to spread its brand world over.
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Woodruffs Strategies:
Goal:
To make Coke available wherever & whenever consumers wanted itin arms reach of desire

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Question 2
Where is coca-cola vulnerable? What should they watch out for? Weaknesses Criticism Legal issues

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Weaknesses
Coke in 2004 laid of many of its employees due to which its employees lost morale Coca cola has 400 different brand under his belly, major of its sales come few products, they should revamp their strategy and promote other product as well.

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Criticism
Health effects coca cola has been put under the scan again and again for quality tests, its high acidic content, caloric content, damage to bones, cocaine contents etc. Unethical businesses practices Coca cola is hated by so many communities world over due to their unethical activity.
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Criticism
They were criticized world over for use of pesticide in their drinks and is actually used as toilet cleaners in many countries. Coca cola is criticized for promoting their products to children while it is considered dangerous for children below 12 years. They are heavily blamed for depleting the ground water table, in 2004 $16 million bottling plant was shut own in Kerala on allegation of drastically declining both quality and quantity of ground water.
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Legal issues
Coca cola has fought so many legal fights in past and continue doing so due to continuous allegations world over. They were sued by Colombian trade union for kidnapping, intimidation and murdering of employees by allegedly using paramilitaries for driving down wages by kidnapping They were sued in US district court in 1997 for knowingly purchasing an illegally stolen land.
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Legal issues
In 2000, they paid $192.5 million to settle race-discrimination lawsuit. In India, coke has to continuously deal with group called Anti Coca-Cola Struggle Committee). In Oct 07, Kerala Govt. initiated a process of filling a criminal case against coca cola for pollution.
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Question 3
What recommendation would you make to their marketing executives going forward? What should they be sure to do with their marketing?

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Recommendation
Product Mix:
The product mix should be carefully selected Coca-cola has 400 brands under its portfolio most of which are not making enough profits. They should focus on health drinks and juices

Price
Mini coke should be re-priced to Rs. 5 Cheaper product should be introduced for rural areas
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Cont
Promotion:
The promotion should be done on the retailers and distributors front The company should only take route of TV ads if they are launching a new product or punch line, otherwise they should stick to print ads. They should engage themselves in sponsoring large scale events They should enter into agreements with more and more restaurant chains
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Cont
Place:
There are still untapped markets for coke in which we recommend they should enter

Process:
They should focus more on quality as low quality has been an issue with coke everywhere

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SWOT

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Strengths
Extremely recognizable brand

Coca colas bottling system

Distribution channel Marketing and advertising strategies

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Weakness
Declining sales in some countries like Indonesia & Thailand Out of 400 products only few are profitable.

Considered as an American ambassador to the world

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Opportunities
Make over of its wide portfolio

Entry into other lines like foods or snacks.

Growing health conscious population, can tap by providing more health drinks. Still there are few countries where coke is not present

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Threats
Continuous debate over its quality, safety issues Growing health conscious population are switching over to health drinks and juices

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Conclusion
Coke is arguably the strongest brand. Even after so many allegations and legal battles coke is still market leader. What we would like to recommend to TCCC is:
Coke should focus their attention towards social responsibility to earn back the lost trust. They should improve there labor working conditions as it is currently under scanner. They should analyze and revamp there product mix They should be very careful with there quality standards
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Thank You
The most common depiction of Santa (red with white cuffs, collar, and black leather belt) was given by the Coca-Cola Company. This is the first ever depiction of the current Santa was in 1931 coca-colas print ads.

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THANK YOU
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