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In the role of marketing consultant, I am presenting a marketing plan and a marketing research brief for Coca-Cola, a leader in the soft-drinks industry.
Introduction
Marketing is definitely one of the major factors that contribute towards the success of any business. Especially in today’s growing competitive economy it is essential that correct marketing is executed so as to survive and grow in the globalized world.
This academic report is intended to provide a detailed analysis of the marketing plan of Coca-Cola Company.
The external environment is analyzed to demonstrate the threats that it imposes. It will also help to understand the monitoring system to be able to deter these threats. The analysis is made on the internal capabilities of the company as well. Within these analyses, the objectives of the company have been discussed. A reflection has been done on the marketing strategies undertaken by the company. Amidst all these, possible implementation, control and monitoring system have been highlighted.
The marketing plan is followed by a marketing research to identify the area of opportunities.
Several resources have been studied to put together the plan and the research.
These resources are mentioned at the end of the report.
Coca-Cola
Coca-Cola was invented way back in the year 1886 by Dr.
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John Pemberton. He was a pharmacist in Atlanta in Georgia. The formula of Coca-Cola was
fabricated by him in the backyard of his house in a three legged pot made up of brass (History of Coca-Cola). The intention at this point was to make a tonic for headache which turned out to be so tasty and refreshing that it gained orders due to this reason.
The name Coca-Cola was pronounced by Frank Robinson, who was partner of Pemberton as well as a bookkeeper. He penned the words “Coca-Cola” in a script which is represented as a flow. This is how the name appears today on the brand and is famous overall. At that time, the average sale in a day was nine drinks. In the entire year, the sale was 25 gallons of the syrup.
With the passage of time, when Pemberton started to lose health, he decided and sold off the company to Asa Candler for a consolidated price of $2,300 in 1891. The first time that Coca-Cola was bottled was in 1894, by the owner of the Biedenharn Candy Company, Joseph Biedenharn. With the increased fame of the brand, there were fake imitators that entered in the market. To avoid confusion, the currently famous contour bottle was designed by the Root Glass Company of Terre Haute, Indiana.
By the year 1919, the product of the company was spread to all the states and the territories. In the same year, the company was bought by a group including Ernest Woodruff for $25 million. Robert Woodruff's (eldest son of Ernest Woodruff) leadership for more than six decades made Coca-Cola a big success all over the world. On May 15, 1950, Coca-Cola was the foremost consumer product to appear on the issue of Time magazine.
Robert Goizueta became President of the company in 1981. Soon, he was recognized as one of the most successful leaders worldwide. The Company introduced “New Coke” in 1985 and later brought up Coke II. This was unable to get the public’s favor and the people demanded their own previous coke back. Visualizing and passing through all ups and downs, today, Coca-Cola is available in 200 countries over the world and the trademark “Coca-Cola” is represented in about eighty languages (The History of Coca-Cola).
Objectives of the Company
The objective of the company is to utilize its assets— its brand, the financial strength of the company, excellent distribution system, worldwide reach, and last but not the least a strong sense of commitment by the team that manages and executes work all across the world—to attain long-term growth that persists and is maintained (Coca-Cola Company, 2010). The vision that the company has for sustainable growth are explained as under: Profit – It works towards being able to provide maximum return to the shareholders of the company. The strategies are framed keeping this objective in mind. People – The workplace should be where people are motivated to work better. Coca-Cola provides a good work environment for the workers to be happy while working.
Portfolio – The Company aims to provide the beverage portfolio to the people that are able to satisfy the desires of the people. The marketing research done by the company before the final product, this factor is kept to be checked in the initial phase. Partners – Coca-Cola aims at maintaining a loyal relation with the partners and till date there is demonstrated a good relationship with all. Planet – The Company has an objective to do something different. This is represented by the fact that new types of beverages are introduced by the company to be different from the competitors and provide variety to the people. Productivity – It aims at maintaining to be effective and fast paced company (Coca Cola's mission, vision and values, 2010). This has been at the core of every action by Coca-Cola as it has an effective space today in the global market.
Marketing Plan
While a marketing plan is drafted or studied, it required thorough examination and in depth research.
Market Segmentation
Coca Cola is one of the successful companies in the context of market segmentation as well. Demographic Segmentation - This segmentation is on the basis of age, gender, income and family size of the consumers. It has introduced various flavors for small children group. After a research when the company discovered that the Light Cola was considered as feminine drink by many, it introduced Coke Zero that aims at male consumer group who are health conscious. Different packing has different cost and targets to meet all the income groups. There is economy packs introduced which targets consumers as per the family size.
Geographical Segmentation - Due to different climatic conditions and regional differences, Coca Cola varies the taste of the product as per the people of that particular country. Psychographic Segmentation - The advertisements done by Coca Cola are the best examples to express how the company segments the market as per the interests, attitudes and values of the consumers. Whenever a famous event takes place, the company introduces an ad in context of the event so that it touches the heart of the people.
Still, the primary market segmentation that is measurable, accessible and whose response can be noticed and worked upon is the segmentation on the basis of Demographic Segmentation. Coca Cola focuses most on youngsters between the ages of 13 to 25
Marketing Strategies
Current Market Strategy
Coca – Cola undertakes the segmented marketing strategy by marketing its products to different segments by separate offerings to them. This is called the differentiated marketing strategy. Coca-Cola is quite popular in the younger group and hence most of its advertisements and campaigns are undertaken keeping in view the younger generation. An appropriate example for this will be that it has put vending machines in the schools and they have announced officially that they will be continuing to target the market. Another example is the “diet coke” that caters to the need of specific people.
The basic product, Coca Cola Soda is targeted to the entire market as a whole. The market strategy thus put to effect by the company is targeting all the possible domains and providing them with soda that meets their demand. This differentiated marketing strategy has provided Coca-Cola with a stand in all the possible markets.
Life Cycle of the Product
It has been a number of years that Coca Cola has introduced the drink in the market. As we can understand from the history, Coke has attained a stupendous response from the people and their likeness, which has contributed towards the growth of the product.
Once the product has been introduces and placed well in the market, comes the maturity stage. And as per the in-depth analysis, Coca-Cola stands at this stage in the product life cycle. At this stage there is a rapid growth in the sales of the product and later starts settling down. To be able to survive at such a phase, it is important to differentiate the product from the competitor’s product. This has been persistently followed by Coca-Cola and as can be seen, has been done very well. Since the sales begin to settle at a particular point, it is essential to give a differentiation to your product.
Branding Strategy
Coca-Cola is a famous international brand. The company has been working effectively and actively on maintaining its brand equity for quite some time now and has been able to achieve a well know brand equity and attained brand loyalty.
Coca-Cola provides a lot of varieties to the people in the range of soda. These varieties cater to the needs of all the market segments. The brand is excellently symbolized in the packaging. This makes it easy for the people to recognize the product. The red color that is implemented is quite eye-catchy and attracts the entire market domain including the primary market of youngsters in the age group of 13 to 25. The contour bottles as well as cans are designed in such a way that the product from Coca-Cola can be easily ascertained.
The brand equity by Coca – Cola has been created through rigorous campaigns undertaken and extraordinary advertisements designed for promotional purposes. It is after a lot of effort that Coca-Cola soda has attained this brand equity.
The branding strategy implemented by Coca-Cola Company has been quite effective in being able to gain a major market share. There are several kinds of brand strategy that can be implemented for the creation of brand equity. Some of these are - Private brand strategy, Family brand strategy, Manufacturer’s brand strategy and Hybrid brand strategy. Coca Cola has made the use of the Individual brand strategy. This can be explained as major products of Coca Cola are provided with their own brand names. For example, Sprite, Fanta, etc. may be represented and publicized as separate lines; the domain remains the same - Coca Cola.
Coca-Cola has introduced new products from time to time. Here is a marketing research brief to demonstrate how Coca-Cola expanded with large range of products.
Marketing Research Brief
Marketing research is as important as the marketing itself. It is essential that we are aware of the current market and the actions and plans of our competitors so that the framing and implementation of the marketing strategies move in the correct direction.
The development of the marketing strategy depends a lot on the marketing research. The plan can only be drafted after there is sufficient information regarding the market. The implementation of the strategy is dependent on the market research again as before the implementation it is important to know how the draft has to be implemented well to achieve the desired results. Evaluation is a comparison of the achieved result and the expected result. Since, it has to be done on the marketing strategy this has its dependence on market research.
There are many opportunities identified for Coca-Cola in the marketing research. These are all derived from the major one is the partnership of Coca-Cola with International Olympic Committee (IOC).
Coca-Cola has been a known name so far. Analyzing the responses and current situation, the major challenge faced by the company’s soda pertains to the health issues and concerns.
I believe that it is required to revisit the entire make of the soda and check it for any harmful products that can be taken off from the making. Also, there can be some additional nutritional or healthy attributes added to the drink. But all this will be required to be done with the taste of the soda not changing or changing negligibly.
A subsidiary of Coca Cola in Britain took a decision of expanding without acquisition of new companies but by itself. This time, the company chose on implementing an internal strategy of marketing to develop new product (A., 2012).
Five stages of marketing research will be required to be implemented to develop the new product and float it successfully in the market. Identification of the Opportunity – Understand the concept behind the need of the change and pen down the ideal product Exploring the Solution – Surveys, focus groups and interviews can be conducted to understand the expectations from the upcoming product by the public. Measuring the Effectiveness – It needs to be gauged that if the new product will be effective enough so as to gain the targeted share in the market. Testing the Market - It is quits a costly affair to launch a new product. The internal and external capabilities of the company assist in being able to do so effectively. Track Market performance – After the launch of the new product, the performance needs to be checked and evaluated against the target.
External Environment of Coca-Cola
We shall conduct PESTLE analysis to understand the external environment of Coca-Cola. This is important because all of the factors are inter-related. If there is a political decision that is taken, it would impact the economic situation of the country and thus the environment (Monitoring system of coca-cola)
The first factor is the Political analysis. It inspects the present and prospective political influences. These include the influence of the tax laws, reforms by the government, tariffs and restrictions in trade. Guardian report of August 7, 2006, advises that there was a ban laid on the sale of coke, in some states of India, in the government offices and the institutes pertaining to education. This led to the company being destitute of prospective market of around 30 million.
The next is the economic analysis. This analyzes the impact by local, countywide and worldwide. If we look at this side, outside the United States, there is increased sale of beverage without alcohol. This means that all these countries will ensure stability and growth for the company.
In the sociological analysis, the analysis catered to the affects to the company with the changes in the attitude and lifestyle of people. This will mean that the target market of the young crowd will keep influencing the strategies of the company.
Technology is another significant analysis where it is evaluated that how the company is affected and influenced by the changing technology. Cherry coke was introduced in 1985; this was a result of the technological advancement.
The impact that the legislation has on the company is examined through the legal analysis. All the inventions and the developments of the product have to go through proper patent procedure. This is done by the company and like any other sector; it is required to meet the legal requirements.
Lastly, the environmental analysis is conducted which ascertains the issues. All the facilities of the company are consistently monitored and checked so as to meet the guidelines set by the government (tabishnehal)
It is discovered that the company takes due care in keeping a check and monitoring the external environment so as to keep up with the standards and avoid any prospective threats.
Internal Capabilities
The analysis of internal capabilities assists in formulating better strategies. Once the internal analysis is done, the company is aware of the resources that are available and are under its control (PremiumWritingService.com)
The increase in the revenue of the company as compared with that in 2009 was $6.48 billion in 2010. The total of the capital of Coca-Cola at that time was announced to be $72.929 billion. The company possesses various resources for it to sustain and grow as a leader in the production of soft drinks. We shall review these capabilities in terms of tangible and intangible resources (PremiumWritingService.com).
While analyzing the tangible resources, we shall cover the financial, human and physical resources of the company that contributes towards its success. The physical resources comprise of the equipments, infrastructure and the land and buildings. It has the set up units in all the states and regions. Because these are self-owned, it keeps the cost of production low. The financial position of Coca-Cola is not hidden from anyone. It is amongst the largest companies and has a strong financial set up. It is thus easy for it to execute new ventures and innovations because the cost, if productive, is not a restriction. There is highly motivational work environment and thus the staff of the company. The company has worked towards the improvement of its workers through lot of trainings. The workers are therefore able to deliver quality and timely work.
The other aspect to look at the internal capabilities is the intangible resources of the company. These comprise of the goodwill, intellectual property and the technology advancement. The company has always had an edge over others through the technological expertise that it holds. It has helped the company to be able to introduce new products in the market which today are quite successful such as flavored drinks. Once these products are discovered, they are patented by Coca-Cola and hence the company enjoys full right over the production of these drinks. The goodwill of the company is stupendous and gives an upper edge to it over any other company.
Differentiation
There have been lots of changes demonstrated by marketing mix of Coca – Cola. Product – The Company has almost 3300 products with a range of variety. Price – The price of the products vary as per the geographical location and the market. Due to variety of products, most of the products have different pricing strategy. Place – It is supplied in most of the parts of the world and is liked by all. It has a planned and effective network of distribution. Promotion – There are many strategies pertaining to promotion and advertisement by Coca-Cola. The marketing mix is floated keeping in view the differentiation as per the product, service, channel, people and image. For the primary target market, the product differentiation is done by keeping in mind the kind of soda that will be liked by this sector. The Service differentiation is as per the needs and requirements of the young crowd which has to be prompt. The images used in the products that are most used by the youngsters are meant to be attractive and eye-catching
Positioning
By positioning it is meant the process of forming and embedding the image that the product has made in the mind of the customers as compared to the products of the competitors. Many companies make soft drinks these days. Although other companies may try to compete at the level of Coca-Cola, they will be unable to match the level of Coca Cola.
Positioning assists in making the customers understand the unique value and image of the product, as compared with the products of the competitors. Coca Cola has plans in place to form such positions that will provide it with a lot of advantage pertaining to its different target markets.
The positioning of Coca Cola has been based on the procedure of positioning through direct comparison and it has been able to position its products to be able to place towards benefit of its target market. Most of the people in general, form an image of a product through putting a comparison with some another product. This is quite evident in the well known professional was between Coca-Cola and Pepsi in all the product domains.
Supply Chain
The supply chain of Coca-Cola Company includes the company itself and nearly 300 bottling partners over the world. These bottling partners are not under direct control and supervision of the company.
The entire supply system of Coca-Cola runs through mode of various local and national channels. The company is responsible for manufacturing and selling the concentrates of Coca-Cola, the beverage base of the drink and also the syrup to the bottling operators. It still is the owner of the brand and has the responsibility and accountability for brand marketing initiatives for the consumers. These bottling partners then are involved in manufacturing, packaging, merchandising and distributing the ultimate beverages to the wholesale and retail customers and also to the other vending partners. All of these further sell the products to final consumers.
All of the bottling partners of Coca-Cola work in direct contact with the customers. These customers here refer to the amusement parks, convenience stores, grocery stores, street vendors, restaurants and movie theaters. These also help the Company to be able to execute many of the localized strategies which are planned and prepared in partnership with the bottling partners.
Market Share
In the year 2011, Coca Cola possessed a market share of around 42% as against the 30% of Pepsi’s market share. With the launch of Diet Coke, Coca Cola was able to expand more and augment its earning and profit levels.
Monitoring and Controls
Monitoring and controlling mechanism permits the companies to be able to check if there exists a variance when the actual budget is compared with the projected budget. This is essential to be executed because it helps in advising and suggesting important and necessary actions to meet the set marketing objectives. There are three tools that have been implemented to assess the performance of the market plan put in place:
* Sales Analysis
In this sales analysis, the total sales affected is broken down to precisely explain the sales in each segment. This will help in identifying the strengths and weaknesses of the plan in the small sections. The sellers of products of Coca Cola range from chief retail supermarkets to quite small stores at the corner of the street.
* Market Share Analysis
In this Market share analysis, the business sales of Coca Cola will be compared with the sales affected by its major competitors. Currently, Coca Cola is going through lot of changes and hence aims to regain the similar control and old of the market as it used to have previously.
* Marketing Profitability Analysis
The Marketing Profitability Analysis checks the cost involved and expended in marketing. Majorly, three ratios are put to use to be able to monitor and control the marketing profitability; they include market research to sales ratio, the advertising to sales ratio and the last one being sales representatives to sales ratio. From the result of these ratios, Coca Cola can determine and gauge any of the emerging trends which may not be welcomed. These can be any variation such as the requirement of a different product altogether. When we compare these ratio results with the actual results it provides the company with an idea on when change should be brought.
Recommendation
After the research, there are a few recommendations proposed.
These include:
Coca-Cola has been a known name so far. Analyzing the responses and current situation, the major challenge faced by the company’s soda pertains to the health issues and concerns.
I believe that it is required to revisit the entire make of the soda and check it for any harmful products that can be taken off from the making. Also, there can be some additional nutritional or healthy attributes added to the drink.
But all this will be required to be done with the taste of the soda not changing or changing negligibly. Coca Cola needs to consider a number of issues relating to the physical distribution of its soft drink products. A distinctive promotion and communication strategy can be incorporated. Since the value proposition of the company is “uniqueness” of soda, there should be communication done to demonstrate the distinct features. I believe this will give a sense of confidence to the consumers that they are able to attain what has been promised to them.
Conclusion
After conducting research and framing the academic report, we have been able to understand the various strategies implemented and the areas of improvement for Coca-Cola. There are some opportunities as well identified which can be worked upon to gain a wider market.
The entire research assisted in gaining knowledge and understanding the concept of marketing better. Also, it helped to understand the overall soft-drinks industry – its strengths and weaknesses as well.
References
A., E. (2012, 09 04). 5 Tips for Developing Product Ranges Through Smart Market Research. Retrieved 01 31, 2013, from www.instant.ly: http://www.instant.ly/blog/2012/09/5-tips-for-developing-product-ranges-through-smart-market-research/ Coca Cola's mission, vision and values. (2010). Retrieved 01 31, 2013, from ww.coca-cola.co.uk: http://www.coca-cola.co.uk/about-us/coca-cola-mission-vision-statement.html Coca-Cola Company. (2010, 02 26). Retrieved 01 31, 2013, from www.wikinvest.com: http://www.wikinvest.com/stock/Coca-Cola_Company_(KO)/Objective History of Coca-Cola. (n.d.). Retrieved 01 31, 2013, from www.coca-cola.co.uk: http://www.coca-cola.co.uk/about-us/history-of-coca-cola-company.html Monitoring system of coca-cola. (n.d.). Retrieved 01 31, 2013, from
Coca Cola Market Plan and Market Research. (2017, Jan 18). Retrieved from https://studymoose.com/coca-cola-market-plan-and-market-research-essay
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