Coca cola marketing strategies Essay
Coca cola marketing strategies
1.1 Marketing management
Marketing is about meeting needs of target markets profitably. The key to professional marketing is to understand their customers’ real needs and meet them better than any competitor can.
1.1:DEFINITION OF MARKETING :
Marketing is a social process by which individuals and groups obtain what they need and want through creating and exchanging products and values with others. (Philip Kotler) Marketing is the analysis, planning, implementation, and control of carefully formulated programs designed to bring about voluntary exchanges of values with target markets for the purpose of achieving organizational objectives. It relies heavily on designing the organization’s offering in terms of the target markets’ needs and desires, and on using effective pricing, communication, and distribution to inform, motivate, and service the markets. (Philip Kotler)
Definition of American Marketing Association:
Marketing (Management) is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational goals.
Marketing management has the task of influencing the level, timing, and composition of demand in a way that help the organization achieve its objectives. Marketing management is essentially demand management. Marketing managers manage demand by carrying out marketing research, planning, implementation and control.
Within marketing planning, marketers must make decisions on target markets, market positioning, product development, pricing, distribution channels, physical distribution, communication, and promotion. Marketing work in the customer market is formally carried out by sales managers, salespeople, advertising and promotion manages, marketing researchers, customer service managers, product and brand managers, market and industry managers, and the marketing vice-president
a) Managerial Process involving analysis, planning and control. (The view of marketing as social process is not of interest to us as managers)
b) Carefully formulated programs and not just random actions. (A charity organization sending volunteers out to collect money – this is not marketing, it is selling) c) Voluntary exchange of values; no use of force or coercion. Offer benefits. (A Museum, seeking members, tries to design a set of benefits that are appealing to potential members.) d) Selection of Target Markets rather than a quixotic attempt to win every market and be all things to all men.
e) Purpose of marketing is to achieve Organizational Objectives. For commercial Sector it is profit. For non-commercial sector, the objective is different and must be specified clearly.
A market consists of all the potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want. Marketers:
When one party is more actively seeking an exchange than the other party, we call the first party a marketer and the second party a prospect. A marketer is someone seeking one or more prospects who might engage in an exchange of values. A prospect is someone whom the marketer identifies as potentially willing and able to engage in an exchange of values.
Marketers do not create needs. Marketers influence wants. Marketers influence demand by making the product appropriate, attractive, affordable, and easily available to target consumers. They also communicate their offering to prospects. Society influences wants. People living in different societies prefer different types of food items, different types of apparel and even different types of jewellery.
A product is anything that can be offered to satisfy a need or want. Offering and solution are synonyms to the product in marketing context.
A product or offering can consist of as many as three components: physical good(s), service(s), and idea(s). Value is the consumer’s estimate of the product’s overall capacity to satisfy his or her needs. Marketers offer value to a consumer when the satisfaction of customer’s requirements takes place at the lowest possible cost of acquisition, ownership, and use. Marketing management:
Marketing management takes place when at least one party to a potential exchange thinks about the means of achieving desired responses from other parties.
The Marketing Concept
The marketing concept holds that the key to achieving organizational goals consists of being more effective than competitors in integrating marketing activities toward determining and satisfying the needs and wants of target markets. The marketing concept rests on four pillars: target market, customer needs, integrated marketing, and profitability.
No company can operate in every market and satisfy every need. Nor can it always do a good job within one broad market.
Some marketers draw a distinction between responsive marketing and creative marketing. A responsive marketer finds a stated need and fills it. A creative marketer discovers and produces solutions that customer did not ask for but to which they enthusiastically respond.
When all the company’s department’s work together to serve the customer’s
interests, the result is integrated marketing. Integrated marketing takes on two levels. First, the various marketing functions-sales force, advertising, product management, marketing research, and so on – must work together.
Second must be well coordinated with other company departments. The company is doing proper marketing only when all employees appreciate their impact on customer satisfaction. To foster teamwork among all departments, the company carries out internal marketing as well as external marketing. External marketing is marketing directed at people outside the company. Internal marketing is the task of successfully hiring, training, and motivating employees who want to serve the customers well. In fact internal marketing must precede external marketing. It makes no sense to promise excellent service before the company’s staff is ready to provide excellent service.
The ultimate purpose of the marketing concept is to help organizations achieve their goals. In the case of private firms, the major goal is profit. Marketing managers have to provide value to the customer and profits to the organization. Marketing managers have to evaluate the profitability of all alternative marketing strategies and decisions and choose most profitable decisions for long-term survival and growth of the firm.
Marketing Concept of Coca cola:
The basic proposition of Coke’s business is simple, solid and timeless. When Coca cola bring refreshment, value, joy and fun to their stakeholders, then they successfully nurture and protect their brands, particularly Coca-Cola that is the key to fulfilling our ultimate obligation to provide consistently attractive returns to the owners of our business. Target market
Coke’s commercials basically based on young generation it is the target market of coke because they want to represent Coke with the youth and energy but they also consider about the old people they then as a co-target market. Major segments
Major segments are basically those people who take this drink daily and those areas where the demand is higher than the other areas. There are so many people who take this drink daily and those people who take weekly and those who take this drink daily and those people who take weekly and those who take less often are always there as well. So, their basic segments are those people who take this drink regularly. Factor affecting sales
There are so many factors, which affects the sale of coke. Here we are discussing three major factors which effects coke.
Per capita income
Per capita income- First we will discuss about “Per capital income”. This is major factor that affects the sale of this soft drink. Because which every passing year budgets are becoming very strict and tight in order to purchase things. So the disposable incomes of the people are coming down.
They spend heavily on rents, utilities, and basic necessities and after that when they get extra money they think about this soft drink. So the decreasing per capital income effects badly in selling and production of this soft drink. Competitors- Coke’s major competitor is “PEPSI” and there is no hesitation to say this because, everyone knows that and all the other cold drinks, water, coffee, tea is the competitors. Weather- Weather is the third major factor in effecting the Coke’s selling. In underdevelopment market so the coke’s consumption in summers is 60% and in winters is 40%.
Major Customers Need:
First of all the majority don’t care that what they are going to have. In other words, they don’t care before drinking that whether it is “Pepsi” or Coke. They don’t actually differentiate between these two brands in order to their tastes. Consumers basically drink what they get. They believe on “What Cold they sold”. Consumer’s availability in brands is basically works like
Pull Consumer demand
For this reason, Coca-Cola has provided their coolers & freezers in the market. They have maximum number of coolers and freezers in the market. They provide this infrastructure free of cost just to provide child coke to their consumer, which they want to be purchases. The salesman & Mechanics regularly visit all the shops where coke has its infrastructure to check that either it is in proper condition or not, if not then they immediately change or repair it.
1.2 TOPIC RELATED CONCEPTS
1.2.1FLAVOURS OF CANS AVAILABE IN INDIA
The Coca-Cola company offers almost all its carbonated drinks in the form of cans for the convenience of the customers both in product satisfaction and pricing. The company is always looking to innovate and come up with , either complete new flavours or new form of cans. The following are available in cans in India.
IN COLA SECTION
Coca-cola, diet Coke and thumbs up are available in 330 ml priced at Rs.20 per can.Coca-
Cola is the original cola, diet coke is introduced with less than 1 caloroie, and thumbs up
is know for its strong fizzy taste and its cofident, mature and uniquely masculine
attitude. This brand clearly seeks to separate the men from the boys.
IN LEMON SECTION
Lime n lemoni Limca can cast a tangy refreshing spell on anyone, any where.
livd up to its promise of refreshment and has been the original thurst choice of millions
of consumers for over 3 decades.
Sprite, a global leader in the lemon lime category, is the second largest sparkling
beverage brand in India.
IN ORANGE SECTION
Internationally, Fanta the ‘orange’ drink of the Coca-cola company, is seen as one of the
favorite drinks since 1940’s. Fanta entered the Indian market in the year 1993.
Over the years Fanta has occupied a strong market place and is identified as ‘The Fun
1.2.2 AVAILABILITY OF FIT CANS
Coca-Cola fit cans are available in 330ml quantity of various flavours such as Coke, Diet Coke, Thumbs up, Sprite, Limca priced at Rs.20 per can. Cans are mostly available in super markets, hypermarkets as customers prefer them to grab them while shopping or take away home. Chapter 2
METHODOLOGY OF STUDY
2.1 NEED OF THE STUDY
To know the various strategies adopted by the company.
To know the performance and effect of the schemes on retailers perception. This will help the company to give the new schemes in the peak seasons like in summer to increase sale of glass bottles and juice mobile bottles.
2.2OBJECTIVES OF STUDY
The main objective of this Fit Cans project is to study the sale of cans in the market. To advertise the various products of the company.
To find out the present sales status of Fit Cans i.e. Thumsup, Coke, Diet Coke, Sprite, Limca, Fanta, at the retail outlets in the area. To collect data from retailers for the analysis and to know the opportunities where there can be more sale. To ensure the availability and visibility of the product.
2.3SCOPE OF THE STUDY
By this study company can know its sales.
This study helps the company to know the actual sales and position of cans in the market. This study helps the company to modify its distribution strategy of the fit cans. The study helps to find out the problems faced by retailers & distributors. 2.3 SIGNIFICANCE OF THE STUDY
This project is helpful to find out the sale trends of the coke products and its effect on consumer value and satisfaction. This study provides an insight to the company that what kind of strategy must be adopted in order to increase the sales and satisfaction o the consumer. This project directly deals with the interaction of different kind of retailers. 2.4 RESEARCH METHODOLOGY
The research includes the study which was descriptive in nature. It basically aims about how Coca-Cola fit cans are doing in the market. The study includes two methods-
Primary includes the following ways-
The data was collected through a structured questionnaire.
2.5 Sampling plan
Sampling unit: Owners of the retail outlets.
Sampling size: 76 OUTLETS
Population : 100 OUTLETS
Sampling procedure: Simple Random sampling
INDUSTRY PROFILE AND
3.1 BEVERAGE ITS CONCEPTUAL ANALYSES
Definition of Beverage
A drink, or beverage, is a liquid specifically prepared for human consumption. In addition to basic needs, beverages form part of the culture of human society. Types of Beverage
Despite the fact that most beverages, including juice, soft drinks, and carbonated drinks, have some form of water in them; water itself is often not classified as a beverage, and the word beverage has been recurrently defined as not referring to water. Essential to the survival of all organisms, water has historically been an important and life-sustaining drink to humans.
Excluding fat, water composes approximately 70% of the human body by mass. It is a crucial component of metabolic processes and serves as a solvent for many bodily solutes. Health authorities have historically suggested at least eight glasses, eight fluid ounces each, of water per day (64 fluid ounces, or 1.89 liters), and the British Dietetic Association recommends 1.8 litters. The United States Environmental Protection Agency has determined that the average adult actually ingests 2.0 liters per day.
An alcoholic beverage is a drink containing ethanol, commonly known as alcohol, although in chemistry the definition of an alcohol includes many other compounds. Alcoholic beverages, such as wine, beer, and liquor have been part of human culture and development for 8,000 years. Non-alcohol Beverages
Non-alcoholic beverages are drinks that would normally contain alcohol, such as beer and wine but are made with less than .5 percent alcohol by volume. The category includes drinks that have undergone an alcohol removal process such as non-alcoholic beers and de-alcoholized wines. Non-alcoholic Variants:
a. Low alcohol beer
b. Non-alcoholic wine
c. Sparkling cider
The name “soft drink” specifies a lack of alcohol by way of contrast to the term “hard drink” and the term “drink”, the latter of which is nominally neutral but often carries connotations of alcoholic content. Beverages like colas, sparkling water, iced tea, lemonade, squash, and fruit punch are among the most common types of soft drinks, while hot chocolate, hot tea, coffee, milk, tap water, alcohol, and milkshakes do not fall into this classification. Many carbonated soft drinks are optionally available in versions sweetened with sugars or with non-caloric sweeteners. Hot Beverages
Hot beverages, including infusions. Sometimes drunk chilled. Coffee-based Beverages
Café au lait
Flavored coffees (mocha etc.)
Flavored teas (chai etc.)
Pearl milk tea
Roasted Grain Beverages
Other: Some substances may either be called food or drink, or accordingly be eaten with a spoon or drunk, depending on solid ingredients in it and on how thick it is, and on preference: Soup
3.2 INDUSTRY PROFILE
The soda drink and bottled water industry in the US includes about 3,000 companies that manufacture and distribute beverages, with combined annual US revenue of $70 billion. Coca-Cola and PepsiCo hold more than 50 percent of the market, following strong consolidation in the past decade. Only a few other companies have annual revenue above $500 million. Most are local or regional manufacturing and bottling operations with annual revenue under $100 million. Competitive Landscape
Demand for non-alcoholic beverages is driven by consumer tastes and demographics. The profitability of individual companies depends on effective marketing. Large manufacturers have economies of scale in production and distribution, with average annual revenue per production worker close to $1 million. Small companies can compete by producing new products, catering to local tastes, or selling at lower prices. Products, Operations & Technology
Nonalcoholic beverages include sodas (carbonated soft drinks, or CSD), bottled waters, juices, and a large variety of mixtures. Sodas account for about 60 percent of the market. The manufacture and distribution of most national soda brands, including Coke and Pepsi, is a two-tiered process.
The primary manufacturer produces flavored syrup called concentrate that is sold to local bottlers who manufacture and distribute the finished product. In a typical bottling operation, the flavored syrup, corn syrup (sugar), and filtered water are mixed in appropriate proportions, carbon dioxide gas is injected, and the finished soda product is poured into bottles or cans, which are capped, labeled, and packaged.(Beverage Manufacture and Bottling:2008). HISTORY
Soft drinks can trace their history back to the mineral water found in natural springs. Bathing in natural springs has long been considered a healthy thing to do; and mineral water was said to have curative powers. Scientists soon discovered that gas carbonium or carbon dioxide was behind the bubbles in natural mineral water.
The first marketed soft drinks (non-carbonated) appeared in the 17th century. They were made from water and lemon juice sweetened with honey. In 1676, the Companied Lemonades of Paris were granted a monopoly for the sale of lemonade soft drinks. Vendors would carry tanks of lemonade on their backs and dispensed cups of the soft drink to thirsty Parisians. PACKING INNOVATIONS:
By the mid-1800s, soft drinks sold in Canada were packaged in 8-ounce (227.2 ml) round-bottom bottles for about 25 cents a dozen, except ginger beer, which was sold in draught form from wooden kegs. Wired cork closures were used until about 1884 with Codd’s Patented Globe Stoppers (25 types in all). Such closures were replaced by the Hutcheson Spring Stopper. The crown cap was introduced around 1905 and improved versions are still widely used, although they are gradually being replaced, especially on larger containers, with reclosable screw caps.
Other packaging innovations since the mid-1960s include canned carbonated beverages, nonreturnable glass bottles and containers made from rigid plastics. However, an effort is being made, often through provincial legislation, to increase the use of returnable glass containers. The Soft Drink Bottling Industry
Over 1,500 U.S. patents were filed for a cork, cap, or lid for the carbonated drink bottle tops during the early days of the bottling industry. Carbonated drink bottles are under a lot of pressure from the gas. Inventors were trying to find the best way to prevent the carbon dioxide or bubbles from escaping. In 1892, the “Crown Cork Bottle Seal” was patented by William Painter, a Baltimore machine shop operator. It was the first very successful method of keeping the bubbles in the bottle. Automatic Production of Glass Bottles
In 1899, the first patent was issued for a glass-blowing machine for the automatic production of glass bottles. Earlier glass bottles had all been hand-blown. Four years later, the new bottle-blowing machine was in operation. It was first operated by the inventor, Michael Owens, an employee of Libby Glass Company. Within a few years, glass bottle production increased from 1,500 bottles a day to 57,000 bottles a day. Home-Packs and Vending Machines
During the 1920s, the first “Home-Packs” were invented. “Home-Packs” are the familiar six-pack beverage carrying cartons made from cardboard. Automatic vending machines also began to appear in the 1920s. The soft drink had become an American mainstay. (Inventors: 2003). Milestones of Industry:
In the industry’s early years the number of carbonated-beverage plants increased steadily, most serving small regional markets. In 1929 the industry was made up of 345 production plants and the value of shipments reached $12.3 million. By 1960 the number of plants had increased to 502 and the value of sales to $172.7 million. Subsequently, consolidation began, prompted by improved production, packaging and distribution facilities. By 1973, 337 plants were in production and the value of shipments was $484 million. In 1985, with sales of about $1.8 billion, the industry had 187 plants in production.
Production volume has also increased dramatically: in 1939, soft-drink bottlers produced about 162 million litres of carbonated beverages; by 1967, production passed 758 million litres; in 1986, shipments were estimated at over 2.1 billion litres; and in 1998 that figure rose to 3.5 billion litres. A Timeline of soft drink invention:
1798 The term “soda water” first coined.
1810 First U.S. patent issued for the manufacture of imitation mineral waters. 1819 The “soda fountain” patented by Samuel Fahnestock.
1835 The first bottled soda water in the U.S.
1850 a manual hand & foot operated filling& corking device, first used for bottling soda water. 1851 Ginger ale created in Ireland.
1861 The term “pop” first coined.
1874 The first ice-cream soda sold.
1876 Root beer mass produced for public sale.
1881 The first cola-flavored beverage introduced.
1885 Charles Aderton invented “Dr Pepper” in Waco, Texas.
1886 Dr. John S. Pemberton invented “Coca-Cola” in Atlanta, Georgia. 1892 William Painter invented the crown bottle cap.
1898 “Pepsi-Cola” is invented by Caleb Bradham.
1899 The first patent issued for a glass blowing machine, used to produce glass bottles. 1913 Gas motored trucks replaced horse drawn carriages as delivery vehicles. 1919 The American Bottlers of Carbonated Beverages formed.
1920 The U.S. Census reported that more than 5,000 bottlers now exist. Early 1920’s The first automatic vending machines dispensed sodas into cups. 1923 Six-pack soft drink cartons called “Hom-Paks” created. 1929 The Howdy Company debuted its new drink “Bib-Label Lithiated Lemon-Lime Sodas” later called “7 up”. Invented by Charles Leiper Grigg. 1934 Applied color labels first used on soft drink bottles, the coloring was baked on the face of the bottle. 1952 The first diet soft drink sold called the “No-Cal Beverage” a gingerale sold by Kirsch. 1957 The first aluminum cans used.
1959 The first diet cola sold.
1962 The pull-ring tab first marketed by the Pittsburgh Brewing Company of Pittsburgh, PA. The pull-ring tab was invented by Alcoa. 1963 The Schlitz Brewing company introduced the “Pop Top” beer can to the nation in March, invented by Ermal Fraze of Kettering, Ohio. 1965 Soft drinks in cans dispensed from vending machines.
1965 The resealable top invented.
1966 The American Bottlers of Carbonated Beverages renamed The National Soft Drink Association. 1970 Plastic bottles are used for soft drinks.
1973 The PET (Polyethylene Terephthalate) bottle created
1974 The stay-on tab invented. Introduced by the Falls City Brewing Company of Louisville, KY. 1979 Mello Yello soft drink is introduced by the Coca Cola Company as competition against Mountain Dew. 1981 The “talking” vending machine invented. (Mary Bellis: 2005)
BEVERAGE INDUSTRY IN INDIA: A BRIEF INSIGHT
In India, beverages form an important part of the lives of people. It is an industry, in which the players constantly innovate, in order to come up with better products to gain more consumers and satisfy the existing consumers.
BEVERAGE INDUSTRY IN INDIA
The beverage industry is vast and there various ways of segmenting it, so as to cater the right product to the right person. The different ways of segmenting it are as follows: Alcoholic, non-alcoholic and sports beverages
Natural and Synthetic beverages
In-home consumption and out of home on premises consumption. Age wise segmentation i.e. beverages for kids, for adults and for senior citizens Segmentation based on the amount of consumption i.e. high levels of consumption and low levels of consumption. If the behavioral patterns of consumers in India are closely noticed, it could be observed that consumers perceive beverages in two different ways i.e. beverages are a luxury and that beverages have to be consumed occasionally.
These two perceptions are the biggest challenges faced by the beverage industry. In order to leverage the beverage industry, it is important to address this issue so as to encourage regular consumption as well as and to make the industry more affordable. Four strong strategic elements to increase consumption of the products of the beverage industry in India are: The quality and the consistency of beverages needs to be enhanced so that consumers are satisfied and they enjoy consuming beverages.
The credibility and trust needs to be built so that there is a very strong and safe feeling that the consumers have while consuming the beverages. Consumer education is a must to bring out benefits of beverage consumption whether in terms of health, taste, relaxation, stimulation, refreshment, well-being or prestige relevant to the category.
Communication should be relevant and trendy so that consumers are able to find an appeal to go out, purchase and consume. The beverage market has still to achieve greater penetration and also a wider spread of distribution. It is important to look at the entire beverage market, as a big opportunity, for brand and sales growth in turn to add up to the overall growth of the food and beverage industry in the econom Market Structure
Non Cola Drinks:
Indian Product Range
Cola Flavour carbonated water sugar
Orange Flavour + Carbonated Water+ Sugar
Mango Pulp+ Treated water+ sugar
Minute Maid Pullpy Orange
Lemon Flavour + Carbonated Water+ Sugar 3
Lemon Flavour+ Carbonated Water + Sugar
HISTORY OF CARBONATED BEVERAGES IN INDIA:
India with population of more than 100 crores is potentially one of the largest consumer markets in the world after China. The consumer market can be defined as the market for products and services that are purchased by individuals as households goods for their personal consumption. Soft drink is a typical consumer product purchased by individuals to quench thirst and secondly for refreshment.
Searching for the point of Indian soft drinks we first document on Gold Spot, this was the first brand soft drink in India. It was introduced by PARLE during later part of 40’s. Cola giant, Coca-Cola was the first foreign soft drink to be introduced in India in 1965, Coca-Cola make a very good beginning and dominated the whole scheme right from the word go. It (Coca-Cola) faced no competition at that time. COCA COLA entered India in the year 1993 in collaboration with PARLE INDIA LTD.
Three of four groups of Indians companies who had the required production capacity started their own brands of Cola, Lemon, Orange, but failed to achieve their goal on a national basis. India always has love and hate relationship with MNC’s which gave a significant opportunities to soft drink industries in India when Coca-Cola decided to windup its operation in 1977 rather than bowing to the Indian government insisting on:- Dilution of equity, as the government felt that lots of foreign currency was being wasted. Manufacturing of the top-secret concentration in India.
Disclose of the chemical composition of the essence.
This left a large vacuum in the popular soft drink market, and a vista was opened to any company with the requisite, technical, marketing and organizational skills. The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian Soft Drink. New soft drink in the form of Tetra pack entered the market among Frooti, Jump-In and Treetop were the prominent once. Till 1977 their equipped bottling plants and the distribution network a longing to be of no use. It took them one year to develop new formula to survive and gradually came up with Campa, Lemon, Orange and Cola that order. CONSUMPTION PATTERNS AND POTENTIAL OF MARKET:
The majority of urban and suburban Indians consume non-alcoholic store bought beverages “less than once a day” suggesting a large untapped market potential. In order to increase consumption and penetration of such beverages however, manufacturers will have to address the two primary reasons why some Indians abstain entirely, that is, health concerns and undesirable taste – as highlighted in Boston Analytics’ survey of 8300 people across 15 cities. Approximately 120 billion liters of beverages are
consumed by Indians every year, but only 5% represent store-bought packaged beverages. The majority of Indian consumers (75%) still consume non-alcoholic store-bought beverages ‘less than once a day’, highlighting a large untapped market opportunity, particularly in the carbonated drinks and juice or juice-based markets (estimated to be worth $1.5 Billion and $.25 billion respectively).
While consumption frequency decreases with age, it is found to increase with income levels, except in the top-most economic strata of society. Health concerns remain the primary reason for not consuming non-alcoholic store-bought beverages at all. Yet of the 40+ brands covered in Boston Analytics’ study, none held a definitive position in this regard either positively or negatively. Boston Analytics’ study also revealed that 29% of those who consume non-alcoholic store bought beverage beverages do so at a fixed time during the day, suggesting that carbonated beverages have become a part of life for a significant portion of the Indian consumer market.
Product taste is the primary driver of brand choice for carbonated, juice-based and sports/energy drinks. While consumptions patterns are somewhat similar across different tiered cities, reasons for not consuming non-alcoholic store bought beverages vary considerably. This study has implications for both the marketing and product development of carbonated, juice based and sports/energy drinks. Significant opportunities exist for manufacturers to expand these markets through both greater consumption and greater penetration. There are numerous initiatives which manufacturers, distributors and marketers can take in order to increase their market share in these product categories.
For example: o Non-alcoholic beverage brands do not appear to be positioning themselves or differentiating themselves along the brand attributes that matter most to consumers in terms of product/brand selection and reasons for consuming and/or not consuming As with most product categories in India, consumption behavior and preferences differ dramatically across cities in India.
While Tier 1 cities (or the largest metros in India) report the highest consumption, significant differences exist among these cities, e.g., in terms of the time of day store-bought non-alcoholic beverages are consumed, preferred brands for carbonated beverages, reasons for consuming a particular product type, etc.). Such differences demonstrate the need for carefully targeted marketing campaigns that appeal to the needs, behaviors and preferences of local communities.
Top Carbonated Beverages Industry Trends
With overall growth of the beverage market slow, national companies have grown through overseas sales and acquisitions. Coca-Cola now owns 20 major beverage brands, PepsiCo 15. Cott, the largest private-label soda maker, has grown in recent years through the acquisition of local bottlers. Brand Management
To distinguish their products from the large number of available competitors, manufacturers have relied heavily on using familiar brand names for new products. For example, Coca-Cola now comes in several different versions that are sugar- or caffeine-free or both, but all under the Coca-Cola label. Gatorade and Tropicana orange juice are now available in many different versions. PepsiCo has agreements with Starbucks and Lipton to use their brand names on new beverages. Private-Labels
Amid the perception by consumers that colas don’t taste different, private-label sodas continue to be popular with budget-minded consumers and local supermarkets. Even though they’re priced lower than national brands, private-label sodas have higher margins for grocers because they’re cheaper to produce and don’t have heavy marketing costs. Cott has a large share of the private-label market, mainly because it supplies Wal-Mart, the nation’s biggest retailer. Economies of Scale
Coca-Cola bottlers in North America have started an independent company expected to save money by giving them greater leverage in negotiations for contracts with suppliers and giant retailers. Projections indicate it could save about $100 million over the next few years through centralized bulk purchases of various goods from aluminum cans to vending machines. The company will also deal with major customers, such as Safeway, which now deals with several different bottlers.
To increase convenience and consumption, beverage manufacturers are constantly experimenting with new product packaging. Coca-Cola introduced new packaging that conveniently fits 12 cans or bottles on a refrigerator shelf. The Fridge Pack was first used by a regional bottler, which saw sales of 12-packs increase 25 percent with the new packaging. In addition to Coke, the bottler has also applied the concept to Dasani water bottles.
3.3 Coca-Cola industry profile:
Coca-Cola, the product that has given the world its best-known taste was born in Atlanta, Georgia, on May 8, 1886. Coca-Cola Company is the world’s leading manufacturer, marketer and distributor of non-alcoholic beverage concentrates and syrups, used to produce nearly 400 beverage brands. It sells beverage concentrates and syrups to bottling and canning operators, distributors, fountain retailers and fountain wholesalers. The Company’s beverage products comprises of bottled and canned soft drinks as well as concentrates, syrups and not-ready-to-drink powder products.
In addition to this, it also produces and markets sports drinks, tea and coffee. The Coca- Cola Company began building its global network in the 1920s. Now operating in more than 200 countries and producing nearly 400 brands, the Coca-Cola system has successfully applied a simple formula on a global scale: “Provide a moment of refreshment for a small amount of money- a billion times a day.” The Coca-Cola Company and its network of bottlers comprise the most sophisticated and pervasive production and distribution system in the world. More than anything, that system is dedicated to people working long and hard to sell the products manufactured by the Company.
This unique worldwide system has made The Coca-Cola Company the world’s premier soft-drink enterprise. From Boston to Beijing, from Montreal to Moscow, Coca-Cola, more than any other consumer product, has brought pleasure to thirsty consumers around the globe. For more than 115 years, Coca-Cola has created a special moment of pleasure for hundreds of millions of people every day. (Source: www.Coca-Colaindia.com)
OBJECTIVE OF COMPANY:
The Company aims at increasing shareowner value over time. It accomplishes
this by working with its business partners to deliver satisfaction and value to consumers through a worldwide system of superior brands and services, thus increasing brand equity on a global basis. They aim at managing their business well with people who are strongly committed to the Company values and culture and providing an appropriately controlled environment, to meet business goals and objectives.(Source: www.Coca-Colaindia.com) COCA-COLA PERFORMANCE IN INDIA
Net operating revenues for the 4th quarter 2009 were 7,5 billion USD. Strong volume growth was achieved in key emerging markets, with 29% in China, 20% in India, and 8% in Brazil. Coca-Cola could achieve good volume growth even in developed markets, namely in France with 12% and in Germany with 3%. PRODUCTS OF COCA COLA:
1. Coca Cola
2. Thums up
3. Mountain due
4. Appy fizz
Competion from substitutes
1. Fruit juices of unorganised market
3. Mineral water
TIME LINE TOF COCA COLA ORIGIN GROWTH AND DEVELOPMENT
Year 1894: A modest start for a bold idea
In a candy store in Vicksburg, Mississippi, brisk sales of the new fountain beverage called Coca-Cola impressed the store’s owner, Joseph A. Biedenharn.
He began bottling Coca-Cola to sell, using a common glass bottle called a Hutchinson. Biedenharn sent a case to Asa Griggs Candler, who owned the Company. Candler thanked him but took no action. One of his nephews already had urged that Coca-Cola be bottled, but Candler focused on fountain sales. Year 1899: The first bottling agreement
Two young attorneys from Chattanooga, Tennessee believed they could build a business around bottling Coca-Cola. In a meeting with Candler, Benjamin F. Thomas and Joseph B. Whitehead obtained exclusive rights to bottle Coca-Cola across most of the United States for a sum of one dollar. A third Chattanooga lawyer, John T. Lupton, soon joined their venture. Years 1900-1909: Rapid growth
The three pioneer bottlers divided the country into territories and sold bottling rights to local entrepreneurs. Their efforts were boosted by major progress in bottling technology, which improved efficiency and product quality. By 1909, nearly 400 Coca-Cola bottling plants were operating, most of them family-owned businesses. Some were open only during hot-weather months when demand was high. In the 1920s and 1930s: International expansion
Led by Robert W. Woodruff, chief executive officer and chairman of the Board, the Company began a major push to establish bottling operations outside the U.S. Plants were opened in France, Guatemala, Honduras, Mexico, Belgium, Italy and South Africa. By the time World War II began, Coca-Cola was being bottled in 44 countries. In the 1940s: Post-war growth
During the war, 64 bottling plants were set up around the world to supply the troops. This followed an urgent request for bottling equipment and materials from General Eisenhower’s base in North Africa. Many of these war-time plants were later converted to civilian use, permanently enlarging the bottling system and accelerating the growth of the Company’s worldwide business. In the 1950s: Packaging innovations
For the first time, consumers had choices of Coca-Cola package size and type-the traditional 6.5 ounce Contour Bottle, or larger servings including
10, 12 and 26 ounce versions. Cans were also introduced, becoming generally available in 1960. In the 1960s: Introduction of new brands
Sprite, Fanta, Fresca and TAB joined brand Coca-Cola in the 1960s. Mr. Pibb and Mello Yello were added in the 1970s. The 1980s brought diet Coke and Cherry Coke, followed by PowerAde and Fruitopia in the 1990s. Today scores of other brands are offered to meet consumer preferences in local markets around the world. In the 1970s and 1980s: Consolidation to serve customers
Advancement in technology led to global economy, retail customers of The Coca-Cola Company merged and evolved into international mega chains. Such customers required a new approach. In response, many small and medium-size bottlers consolidated to better serve giant international customers. The Company encouraged and invested in a number of bottler consolidations to assure that its largest bottling partners would have capacity to lead the system in working with global retailers. In the 1990s: New and growing markets
Political and economic changes opened vast markets that were closed or underdeveloped for decades. After the fall of the Berlin Wall, the Company invested heavily to build plants in Eastern Europe. As the century closed, more than $1.5 billion was committed to new bottling facilities in Africa. 21st Century: Coca-Cola today
The Coca-Cola bottling system grew up with roots deeply planted in local communities. This heritage serves the Company well today as consumers seek brands that honor local identity and the distinctiveness of local markets. As was true a century ago, strong locally based relationships between Coca-Cola bottlers, customers and communities are the foundation on which the entire business grows.
VISION FOR SUSTAINABLE GROWTH
PROFIT: Maximizing return to shareowners while being mindful of our overall responsibilities. PEOPLE: Being a great place to work where people are inspired to be the best they can be. PORTFOLIO: Bringing to the world a portfolio of beverage brands that anticipate and satisfy peoples’ Desires and needs. PARTNERS: Nurturing a winning network of partners and building mutual loyalty. PLANET: Being a responsible global citizen that makes a difference. COCA-COLA: MISSION
Create consumer products services and communications customers service and bottling system strategy process and tools in order to create competitive advantage and deliver superior value to- Consumers as a superior beverage experience.
Consumers as an opportunity to grow profit through the use of finished drinks. Bottlers as an opportunity to make reasonable to grow profits and value added Suppliers as an opportunity to make reasonable when creating real value added in environment of system wide teamwork, flexible business system and continuous improvement. Indian society in form of contribution to economic and social development. RED CONCEPT:
RED stands for Right Execution Daily. It is a survey method for the company to know their position in the market. ABOUT RED:
To check the availability of the visi cooler provided by the company to the retail outlets for their products. To check the activation in various outlets.
To check the branding order of the various products in the cooler. Survey has done in the four topics-
There should be no impurity in the visi cooler of the company. Impurity here refers to that brand which is presented in the visi cooler other than coke’s product. Therefore no other product of any other company should be in the cooler. BRAND ORDER:
The company has given a brand order to the market developers to arrange the different brands in a specific order in the cooler. The order should be in such a way- Thumsup
Pet & Juice
Availability is done according the type of outlet. There are four type of outlet mentioned below. According to this market developer has to ensure the availability of the products in the particular outlet. ACTIVATION:
Activation is important because it helps to boost the sales of the company. It is done through the Glow sign, Shelf display, flanges. Combo boards, Table tops .This boards usually gives to the E&D outlets .It helps to attract the customers. Rack with header is provided to the grocery stores. Market developer must ensure that all these activation elements must available at all the outlets. VARIOUS ACTIVATION ELEMENTS:
1. WARM DISPLAY RACK
2. SHELF DISPLAY
SHELF DISPLAY DISPLAY OF RACK VISI COOLER
2. SIX MOBILE HANGER
3. VISI COOLER BRAND STRIP
4. WARM DISPLAY RACK
5. TABLE TOP RACK
TYPES OF OUTLETS:
The company has divided their outlets on the basis of the following criteria-
There are four types of outlets according to the volume of sales of the outlet- Platinum – 1500 & above per year
Diamond – 800-1500C/s & above per year
Gold – 500-799C/s per year
Silver – 200-499C/s per year
Bronze – above
CONCEPT OF RED:
Hindustan Coca-Cola Beverages Pvt.Ltd. India division Under Eurasia Operating Group has been working on RED i.e. Right Execution Daily Since JAN 2006.Coca-Cola company believes that its success depends on their ability to connect with consumer by providing them with a wide variety of choices to meet their desires, needs and lifestyles choices, company success further depends on the ability of their people by execute effectively every day. MEASURING THE PERFORMANCE OF RED:
To measure the impact of Right Execution Daily (RED) a survey (RED AUDIT) is done by third party (a consultant) every month. Third party conducts a survey by visiting all the RED activated outlets and benchmarks it on the prescribed Merchandising standards of RED. A monthly report is send to Hindustan Coca- Cola Beverages Private Limited. The report is called as To create the Red Report third party asks a set of question from the retailers which are as follows:
Related to Visicooler:
Is Cooler in the Hot Spot Location?
Does it have all the products of Coca-Cola available?
Is the display of the Coca-Cola display of the products in a standard such as
sprite, Thums up, Maaza, Fanta and Limca”,) Is cooler working properly?
Is the cooler pure?
Related to Price Communication:
Is there proper price display of the products?
Related to product availability:
All the brands should be present in the every distribution channel but main concern is that 300 ml should be present in the every channel and 600 ml and 1.5 liters per bottles should be present in the Eating and. drinking, convenience and Grocery shop.
.PRE SALE CONCEPT
This is a new concept by the company. In this concept company takes order one day before and then delivers the product to each route. So this gives more time to market developer to assure RED.
This concept has so many advantages-
This gives more time to the market developer for the activation & branding purpose. By this company can easily implement the RED concept in better way. Presale concept makes assure of more availability of the products in the market. This concept is easy in processing.
By this concept market developer can arrange the product in better way. The Company can display its products in proper way so that customers can attract towards it.
Analysis of data
4.1 MARKET SHARE OF CANS
Q.1 Which cans are more demanded by customers?
Table no. 4.1
Type of can
Pepsi Slim can
INTERPRETATION: From the above table It can be said that Coca-Coca fit cans has 70%
market share where as Pepsi slim cans has only 30% market share.
4.2 ORDER PLACING
Q.2 How many cases of cans do you order
Table no. 4.2
No. Of cases
Chart no. 4.2
INTERPRETATION: From the above table it can be said that 70% of retailers are placing
order of 0.5-1 case, 15 % are placing 1-2 cases, 10% are placing 2-5 cases and 5 % are
placing 5 and above cases of order.
4.3 EFFECT OF CHANGE IN PRICE AND QUANTITY ON CANS
Q.3 Does the change in price and quantity of fit cans increase sales?
Table no. 4.3
INTERPRATATION: From the above chart we can say that 80% of retailers said that
change in price and quantity have effect on sales of cans, 15% of them did not agree and
5 % of them said they cannot say.
4.4 MARKET DEMAND FOR VARIOUS FLAVOURS OF CANS
Q.no.4 Which flavor of cans are more sold
Chart no. 4.4
INTERPRETATION: From the above chart we can say that thumbs up has 45% market
share, diet coke has 20%, coke has 12% , fanta has 8%, and both sprite and limca has 8%
4.5 CHANNEL WISE AVAILABILITY
Q.no.5 Channel wise availability of cans?
Table no. 4.5
Type of channel
INTERPRETATION: From the above chart we can say that 65% fit cans are available in
Grocery-1, 15% in E&D-2, 10% in convenience, 10% in travel.
4.6 VPO WISE AVAILABILITY
Q.no.6 VPO availability of cans?.
Volume per outlet
INTERPRATATION: From the above chart we can say that 45% of cans are available in Platinum outlets, 30% in Diamond outlets, 15% in Gold outlets, 8% in Silver outlets and 2% in Bronze outlets. 4.7 NON RED OUTLETS AVAILABILITY
Q no. 7 Availability of cans in non red outlets
Table no. 4.7
Non red outlets
Shared with Competitor
Chart no. 4.7
INTERPRATATION: From the above chart we can say that in non red outlets 80% of them are shared with competitor, and 20% of them have own cooler.
4.8 FLOOR STOCK AT THE OUTLET
Q no.8 No. of cases of floor stock maintained at the outlet
Chart no. 4.8
INTERPRETATION: From the above chart we can say that 75% of retailers are maintaing 0.5-1 case of floor stock, 10% are maintaining 1-5cases of floor stock, and 15% are not maintaining any floor stock.
Coca-Cola had a very high customer awareness and demand.
Retailers are very much satisfied with market developers behavior. Retailers are not allowing market developers to keep visi-coolers pure There are some loyal customer who prefer selling only Coca-Cola.
More promotional offers have to be introduced.
Coca-Cola Fit cans should be promoted more in order to increase the sales. New schemes should be introduced for retailers in order to promote Fit cans. Market developers should be given some amount which can be used to provide credit facility to some retailers. Coolers should be provided in petrol bunks so that it will generate impulse purchase as traffic will be more in petrol bunks like siripuram h.p.
The Company employees should make direct contact with the consumers, so that they may aware with real situation of the market and consumers attitude towards the product. For this they can arrange awareness camps in different locations like recently they gave free cokes in beach road Floor stock must be maintained so that consumers can enjoy continous supply.
This project is playing a very important role for the company. With the help of this project, company can know its opportunities in the market. Because in this project the survey is done by interacting with different kinds of people by which the attitude towards the product can be known. All the activation elements like maintainance of floor stock, rack display, standees etc must be available at all outlets . All these elements help the company in increasing the sales.
Definitely when sales increase then profits also increases. With the help of this project company has increased its sale and also company can measure or check the performance of each retailers working with COCA COLA COMPANY.
A. Philip Kotler (2009), “Marketing Management” Prentice Hall of India, New Delhi, Eleventh Edition. B. Bellur and Berkman (1987), “Readings in Marketing Management” Himalaya Publishing House, New Delhi, First Edition. C. Samars and Barmer Stanton “Fundamentals of Marketing” Mc Graw Hill Company, Ryerson, Eight Edition. D. Gupta and Rajan Nair (2002), “Marketing Management” Sultan Chand & Sons, New Delhi, Seventh EditionPhilip Kotler (2009), “Marketing Management” Prentice Hall of India, New Delhi, Eleventh Edition. E. Bellur and Berkman (1987), “Readings in Marketing Management” Himalaya Publishing House, New Delhi, First Edition. F. Samars and Barmer Stanton “Fundamentals of Marketing” Mc Graw Hill Company, Ryerson, Eight Edition.
QUESTIONNAIRE ON COCA-COLA FIT CANS 1.Which cans are more demanded by customers?
a)Coca-cola fit can b)Pepsi slim can
2.How many cases of cans do you order?
a)0.5-1 case b)1-2 case c)2-5 case d)5&above
3.Does the change in price and quantity of fit can increase sales? a)Yes b)No
4.Which flavour of cans are more sold?
a)Coca-cola b)Thumps up c)Fanta d)Sprite e)Diet coke f)Limca 5.Channel wise availaibility?
a)cConvenience b)E&D c)Grocery d)Travel-1
6.Volume per outlet wise availability?
a)Platinum b)Diamond c)Gold d)Silver e)Bronze
7.Non RED outlet availability?
a)Own cooler b)Competitor but shared
8.Floor stocks at the outlet?
a)1case b)1-5case c)Nil