The Coca-Cola Company is a global business enterprise and one of two main soft drink sellers. Study of this report helps the reader to know that how Coca2
Cola has achieved its current market position. This report enlightens those factors that company has adopted during its long journey of 52 years in Pakistan. This report includes the introduction, micro and macro environment factors affecting coke. The reader of this report can expect that after having complete study he/she can certainly have a broader view the marketing environment of Coca-Cola that who are the competitors what are the company’s internal factors & customers, its external factors like economic, natural & technological are affecting Coca-Cola Company.
The Coca-Cola Company began operating in Pakistan in 1953. Coke, Fanta Sprite & Kinley are the brands with whom Coca-Cola is operating in Pakistan. The Coca-Cola System in Pakistan operates through eight bottlers, four of which are majority-owned by Coca-Cola Beverages Pakistan Limited (CCBPL). The CCBPL plants are in Karachi, Hyderabad, Sialkot, Gujranwala, Faisalabad, Rahim Yar Khan, Multan and Lahore.
The remaining two plants, independently owned, are in Rawalpindi and Peshawar.
The Coca-Cola System in Pakistan serves 70,000 customers/retail outlets. The Coca-Cola System in Pakistan employs 1,800 people working constantly for the company. During the last two years, The Coca-Cola Company in Pakistan has invested over $130 million (U.S) and coke has successfully provided 51 years of dedicated service to its customers in Pakistan. Since the beginning of Coke Company the firm has been continuously changing its slogans (Appendix.
1) and that’s a very creative idea to get the attention of the customers. 1.1 Mission, Vision & Values of Coca Cola (Reference 1)
The world is changing all around us. To continue to thrive as a business over the next ten years and beyond, we must look ahead, understand the trends and forces that will shape our business in the future and move swiftly to prepare for what’s to come. We must get ready for tomorrow today. That’s what our 2020 Vision is all about. It creates a long-term destination for our business and provides us with a “Roadmap” for winning together with our bottling partners.
Our Roadmap starts with our mission, which is enduring. It declares our purpose as a company and serves as the standard against which we weigh our actions and decisions.
To refresh the world…
To inspire moments of optimism and happiness…
To create value and make a difference.
Our vision serves as the framework for our Roadmap and guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable, quality growth.
People: Be a great place to work where people are inspired to be the best they can be.
Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and
satisfy people’s desires and needs.
Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value.
Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities.
Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities.
• Productivity: Be a highly effective, lean and fast-moving organization. Our Winning Culture
Our Winning Culture defines the attitudes and behaviors that will be required of us to make our 2020 Vision a reality.
Live Our Values
Our values serve as a compass for our actions and describe how we behave in the world.
Leadership: The courage to shape a better future
Collaboration: Leverage collective genius
Integrity: Be real
Accountability: If it is to be, it’s up to me
Passion: Committed in heart and mind
Diversity: As inclusive as our brands
Quality: What we do, we do well
Focus on the Market
Focus on needs of our consumers, customers and franchise partners Get out into the market and listen, observe and learn
Possess a world view
Focus on execution in the marketplace every day
• Be insatiably curious
Act with urgency
Remain responsive to change
Have the courage to change course when needed
Remain constructively discontent
Act Like Owners
Be accountable for our actions and inactions
Steward system assets and focus on building value
Reward our people for taking risks and finding better ways to solve problems
Learn from our outcomes — what worked and what didn’t
Be the Brand
Inspire creativity, passion, optimism and fun
1.2 Objectives Of Coca-Cola
The company has sales based objective .Every thing else (marketing plan, advertising plan, production etc.) is derived from this objective.
Currently the company‘s objective is to
“Increase the volume of sales up to the maximum level as much as possible during the current fiscal year.”
The company sets its objective keeping in view the past performance, Historical trends, current market position, economic condition, macro environment and micro environment factors, social values, market size and growth rate ,future expectations and predictions.
The forces outside marketing that affect marketing management ability to develop and maintain successful relationships with its target customers. There are two types of marketing environments that may affect any company’s operation, Microenvironment and the Macro environment. The Coca-Cola Company also has its Marketing Environments which affect on its business.
Micro environment factors affecting Coca Cola
Micro Environments are the internal environments of any company like company itself, marketing intermediaries, suppliers, customers, competitors & Public following are the major micro environmental factors which are affecting Coca-Cola. I.
Chairman of Board & Chief Executive Officer
Joseph V. Tripodi
Chief Marketing & Commercial Officer (EVP)
Coca-Cola Operates in more than 200 countries and a market portfolio of 3000 beverage products including Carbonated Drinks, Sparkling Drinks and still beverages like mineral water, juices, coffee & Energy Drinks (Appendix. 2). Head quarters in Atlanta, Georgia Coca-Cola have more than 92400 associates
across six operating groups Eurasia, Latin America, North America, Pacific & bottling Investment as Corporate. (Reference 2)
In Pakistan Coca-Cola working under the Eurasia group Coca-Cola business Strategy is based on local marketing they establish there plant in the country where they want to do business instead of exporting. In Pakistan they have there production plants in. Karachi, Lahore, Hyderabad, Rhim yar Khan, Faisalabad, Rawalpindi, Multan, Sialkot, Gujranwala & Peshawer.
There marketing Department working close with other departments like purchase, accounts, distribution etc to achieve there goal. Following is the organizational Departments of Coca-Cola. (Reference 3)
a. MARKETING DEPARTMENT
The Coca Cola marketing department develops core strategies for company brands to ensure that all communication is consistent in every market. With this cohesive effort, the Coca-Cola system maximizes its resources for market leadership and profitable 6
growth. The marketing departments are responsible for marketing the products and advertising the products and promoting the products. If all these departments perform their duty firmly then the objectives of The Coca-Cola Company will meets. b. FINANCE DEPARTMENT
The finance department of the Coca Cola Company is responsible for financial record keeping. This involves keeping records of money received and paid out. The financial records will be used to produce the annual reports for the shareholders so that they can see the company performance. The Finance department is also responsible for the management accounts of the business like marketing etc.
The Coca-Cola Company finance department is also responsible for making budget of the company and for each department like marketing department or research and development department. They will also be involved in the planning process like taking over or any major decision. c. PACKAGING DEPARTMENT
The packaging department of Coca-Cola Company is responsible for the packaging of the products. They have to make the packaging attractive so that that product meets the eyes of the consumers. Bringing new products package is their responsibility. It works with the companies bottling partners to produce an attractive combination. d. SALES DEPARTMENT
The sales department of the Coca Cola Company is to coordinate the selling program. They also have to make the distribution methods, etc. Also, decide how much to sell and how much to store in the warehouse and to choose the transporting method which is the most cost efficient and the quickest way.
e. RESEARCH AND DEVELOPMENT DEPARTMENT
This department has their budget given by the finance department and their responsibility is to investigate new products. They work closely with marketing by looking at marketing research findings. They have to bring new products in the market for the change because the consumer cannot stick with the same old products. If necessary then they also have to improve the quality of the products.
The Coca-Cola Company research department has done a lot of research and recently they have launched many new products like Diet coke with lemon, Fanta Tropical, Minute maids, Fanta raspberry, Fanta blue berry etc.
This department is essential for keeping the business going. They act as a help support of the company, it is not the central purpose the business but every business organization would need this department. Most businesses rely on administration to be organized. They deal with enquiries, give messages produce documents and give 7
information to any customer. The complaints that this department will get
would be transferred to the research and development department to make the product better or fix the problem that the consumer is having. These departments are the most important department of The Coca-Cola Company because they helps the company to meets the objectives of The Coca-Cola Company i.e. surviving, customer satisfaction and make more profits. As I said that the help desk department satisfies the customer by providing the information they needs and taking the complaints and passing to the research and development departments who improves the products.
Marketing intermediaries help the company to promote, sell and distribute its goods to the end users. Intermediaries include resellers, distribution firms and marketing agencies. When we talk about coke, Coke Company in Pakistan as well as abroad have recognized the importance of working with their intermediaries. For example recently Coke signed ten years deal with US based company Wendy that it will provide coke to all the fast food chains located in US.
Wendy in this case is a big example of intermediary for coke. In Pakistan other than various resellers, McDonald is one big party that is reseller of coke and also Subway is a big reseller of coke. Similarly there are thousands of private agencies (intermediaries) that are working for coke to distribute the product to the shopkeepers and retailers all over the country.
Currently there are 46 distributors working in Lahore. Coke Company uses two techniques for distribution, direct distribution and indirect distribution. In direct distribution company uses no agencies or middlemen to distribute the soft drinks but company has its own system of distribution that includes Company’s trucks and labor as well. The other way is indirect distribution in which company opts for various distributors that take the product from factory to the retailers and resellers. III. Suppliers
Suppliers always play an important role in any company’s operation. Suppliers provide resources and raw material that company requires to produce the goods and services. Coke company suppliers in Pakistan vary with respect to
the raw material they provide. Following is a brief list of different suppliers of coke.
Baluchistan Glass Limited provides glass bottles of all sizes that are used in bottling. (Reference. 4)
ShangHai Plato chemical co. Ltd provides pet bottles with the labels. Labels are designed by the Packages Ltd. (Reference. 5)
Saharan Mills Limited provides the quality sugar in hygienic packets. Vanillin Intercool Pakistan provides the machinery such as visicoolers and chest coolers for the chilled coco-cola.
Dynamic Equipment and Controls (PVT) Limited provides industrial refrigeration solutions, dispensing equipments, complete bottle line and capping machines. (Reference. 6)
Recent survey shows that coke is the only product in the world with which more than 85% of the population is well aware of. All the companies have to keep updated study of their customers and in case of coke the company has always maintained excellent customer retention. Value of customers for coke can be understood by these factors that coke spends lot of efforts (financial and human resource) on customer research. For example, Coke knows through market survey that we put 3.2 ice cubes in a glass and one million of US population drinks coke with breakfast every day. This is how coke has been favorite drink of customers for centuries.
Coke customers vary massively in terms of age. From kids to youngsters, from
youngsters to elders and from elders to older, coke has always captured high customer attention from decades. We can divide coke customers in different categories. a. Consumer Market:
This is the group of consumer from where coke purchases are at the highest level because consumer market includes individuals and households. Households mostly buy coke for daily use in large number and purchasing by individuals is also the case of repeat purchase. Healthy consumer market is a big advantage for the company. b. Reseller Market
Reseller market of coke is very large all over the world. This is the market, which buy the product from company and resell it at profit. In Pakistan McDonald is the biggest example of reseller of coke. McDonald purchases coke from the company and sell it with each fast food deal served at restaurant. The survey shows that each branch of McDonald located in Lahore & Karachi sells approximately 500-700 liters of coke daily to its customers. Subway is also has contract with Coca-Cola to serve coke with its every salad & sandwich.
c. International Market
International market consists of those buyers who are in other countries. Coke is worldwide known product and every country where coke is been sold has a manufacturing unit of its own. Similar is the case in Pakistan. Coke manufacturing plants are in Karachi, Hyderabad, Sialkot, Gujranwala, Faisalabad, Rahimyar Khan, 9
Multan and Lahore and these plants are producing the drink for the local use. So in Pakistan there are no international buyers of coke.
All over world there are two soft drink giants, Coke and Pepsi. The competition between two companies has always been neck to neck. Both these companies keep on try to take lead in terms of pricing, packaging, promoting and placing. Pepsi is a world leader in convenient foods and beverages, with
revenues of about $27 billion and over 143,000 employees. Pepsi brands are available in nearly 200 countries and territories. As we compare the products of these two competitors we come to know that Coke has two flavors in Pakistan that is coke plain and coke diet where as similar is the case with Pepsi as only these two flavors are available of Pepsi as well.
So in this perspective both parties have equal strength. However competition is at its peak in terms of pricing. So many times we see that as soon as Pepsi lower downs the price of 1 liter pet bottle or disposable drink, Coke adjusts its price right away so that they may not loose their customers. Although both these brands have sufficient amount of buyers all over the world but still both the companies strive to achieve the market leader position.
Coke even after 99 successful years in US still trying best to be more innovative. Coke manufacturers spent two years and 4 Million $ on research before settling on a new formula and finally came up with “sweeter new coke” and later on with “cherry coke”. Companies make all these efforts to give more customer value and satisfaction than its competitors.
In Pakistan recently a few other beverages are also introduced such as Mecca-Cola and Amrat-Cola but currently these soft drinks are not a threat for coke due to their very low market share and secondly due to brand loyalty of customers for coke.
Competition in Pakistan
Every country has different type of public which effect any business in the country most effective public for Coca-Cola is media public. Media plays a vital role in Coca-Cola in Pakistan.
The field of advertisement is one area where Coca-Cola has always emphasized. In year 2000 Coca-Cola unveiled the biggest advertising billboards in the history of Pakistan. Each unveiling was marked by entertainment and light shows watched by thousands of people. Similarly in July 2000 Coca-Cola launched its first under the crown promotion by the name of Dream Vacations in which the consumers could collect caps of promotional bottles of Coca-Cola like Sprite, Fanta and Coke. Internal Public
Our company is built around two core assets, its brands and its people. That’s what makes working here so special. We believe that work is more than a place you go every day. It should be a place of exploration, creativity, professional growth and interpersonal relationships. It’s about being inspired and motivated to achieve extraordinary things. We want our people to take pride in their work and in building brands others love. After all, it’s the combined talents, skills, knowledge, experience and passion of our
people that make us who we are.
Our 92,800 associates around the world live and work in the markets we serve — more than 87 percent of them outside the U.S. In this geographically diverse environment, we learn from each market and share those learn quickly. As a result, our Company culture is ever more collaborative. From beverage concept and development to merchandising, our associates are sharing ideas across departments and markets in new ways. Consequently, our associates are increasingly enthusiastic about their work and inspired to turn plans into action. (Reference 7)
Macro environment factors affecting Coca Cola
Coca cola knows its people very well. It offers different flavors & packaging according to its customer’s taste. It offers following sizes & every size is targeting different slots of customers.
SSRB (Standard size returnable bottle)
LRB (Large size returnable bottle)
NRD (Non-returnable/ Disposable bottle)
PET (Plastic Bottle 500 ml)
PET (Plastic Bottle 1.5 liter)
CANS (tin pack 330 ml)
It targets its different sizes according to customers of different age groups & occupations.
SSRB is generally targeted to young children & people going to schools & universities. It is also targeted to the people of lower class. LRB & PET 1.5 liters is usually consumed by households &I s one of its economy packs.
Disposable bottles are for the “on the go” people. As they don’t have the time to stand at a spot & drink the whole beverage.
PET 500ml was introduced, on the basis of the analysis, which shows that people nowadays are in a trend to drink two 250ml coke bottles together. As Coca Cola is a company who knows its consumers very well, they introduced the 500ml Pet bottle.
Business executives always expect something different for them form an organization, so Coke CANS were the answer to their expectation from coke.
Different flavors always attract different types of people. They are for the people who always want to try something new.
Classic coke is the one suitable product who don’t want a change in their life or who don’t want to try something new.
Keeping the people in view who are fitness oriented, health conscious & diabetic patients Diet Coke is the solution for all their beverage problems. Vanilla Coke was introduced for the people who want a more sweetened beverage & who are looking for vanilla in everything they have. Cherry & Lime Coke is targeted to the people who want something citrus.
Coca Cola launches its product after they study their customers in deep detail & conclude that what their customers really wants from them. Consumers always welcome Coca Cola’s product, as they know that Coca Cola is the one who knows them the best.
2. Economic factors
Economic factors do affect a company in negative & positive manner. Coke is not an exception here, it is affected if there is inflation in the country & as a result coke increases its prices. Pepsi is always waiting to take a competitive edge. The increased price is a high negative effect on coke. Coke has employed 1800 workers in the last two years & huge amount of revenues have been collected from Pakistan. The economy worldwide was disturbed by the incident of September 11th,2001. The disposable income of the people of Pakistan is increasing day by day & coke that was thought as a luxury good is now becoming a necessity.
3. Social factors
Coke, a customer oriented company, always take steps for the welfare of its consumers. The recyclable products used in manufacturing coke helps save people’s environment. Coke is also helping the needy & knowledge seeking people with fewer resources by providing them books, scholarships & opportunities to work. Coke has launched a program in Gujranwala & Rahim Yar Khan, Pakistan where it provides basic education to children (Reference. 8).
Coke has also launched programs to increase awareness about the conservation of water & natural resources, climate changes, waste environment education & recyclable products.
The Coca-Cola Export Corporation (TCCEC) has set-up an endowment fund at Pakistan’s premier university, Lahore University of Management Sciences (LUMS). The fund, donated by The Coca-Cola Foundation, will be used for funding entire education of 02 students for 4 years of Bachelors program at LUMS’s School of Science & Engineering.
These students belong to underprivileged areas of Pakistan but their educational record is extremely impressive and they are called Coca-Cola Scholars.In 2005, TCCEC started ‘Adopt-a-School’ program, under which we adopted 05 government schools and supported them by building classrooms, parks, providing free books, furniture etc. Also, TCCEC has long supported CARE Foundation for providing free education to underprivileged children of Punjab province. (Reference. 9) 4. Technological factors
Technology in any field is effecting the development of that industry at a high rate. Beverage industry is also affected by the technological factors but in a positive manner. The new methods of filling the bottles, the refrigeration methods, the disposable bottles, the PET bottles all made so many changes to the Coke which is one of the giants in the beverage industry.
Coke is adopting all the new technologies available. Coke is being supplied with the refrigerators, visichest coolers & many more for keeping the bottles chilled, as they claim in the subcontinent “thanda matlab Coca Cola”. Coca Cola Company got the technology of dispensers so they give Coke to people that is as fresh from the fountain. Coca Cola Company has adopted the technology for the usage of 13
PET bottles, which are also environmental friendly. Coca Cola Company adopted the recycling method to keep its environment clean & also to have the soft corner in people’s heart. Coca Cola Company is producing new packaging sizes with differentiated packaging with the help of new technology everyday. 5. Cultural factors
Culture of Pakistan is gourmet, music, sport & religious oriented Coca-Cola has many opportunities in any occasion in Pakistan Coca-Cola always there, like a.
Coca Cola & Cricket
Pepsi is one of the biggest official sponsors of cricket & is also the official drink of cricket. Coke is there, giving Pepsi a tough time. Coke has sponsored eight Pakistani cricket players. Coca Cola is targeting cricket as it is one the famous & growing all over the world.
Coca Cola & Musical Concerts
When you think of Pakistani Punjabi bhangra, Abrar-ul-Haq is the first name you think of. Coca Cola is the official sponsor of Abrar. Coke sponsors almost all of the concerts of Abrar. In most of the hoardings, billboards & TV commercials of coke, we see Abrar performing & promoting coke. Junoon is a known name all over the world. Coke targeted its customer through music celebrities & asks them to perform in their concerts & commercials. You see Junoon performing a desire of having a coke is rite in you.
Coca Cola & Food Mela
This is the century when food industry is at its boom. Coca cola organizes food melas for the people. In Karachi, coke treated thousands of people by bringing 50 bustling restaurants all together in one area. All those restaurants were offering coke as the only beverage in the food mela.
Coca Cola & Basant
Basant is one of the biggest events in Lahore. Coke was the official decorator of Lahore hired by PHA. Coke has promoted its products so much with relevance to basant that at basant whenever you want to drink something chilled, the first name you think of is Coke. It is there in the mind of the people that “Where there is Basant there is Coca Cola”.
Coke in Ramzan & Eid
Eid & Ramazan is one of the holy events of muslims. Coke earns its great revenues in the month of Ramazan & at the time of Eid. It offers new packaging or great discount offers also special offers at Eid.
6. Political factor
Political factors usually effects company working on the international level doing imports & exports. Coke usually performs its operations in the local market.
Coke is not usually affected by government regulations & deregulations as no major changes occur in the food laws.
Coke is a very environmental friendly product. From the caps till the labels on the PET bottles, everything is recyclable.
Depreciation of currency generally has no major effects on Coke they really don’t do imports & exports on large scale. They try to be local market oriented, they keep at least one company owned plant in a country.
Sudden changes in political conditions in a certain country doesn’t effect much on Coke, as it is a purely consumer product.
Pressure groups tried to de-market Coke in Pakistan by spreading the rumors that the revenue collected from coke goes to the Jewish lobby.
7. Natural Factor
Water is vital to both WWF and The Coca-Cola Company. Beverages are The Coca-Cola Company’s business, and water is the main ingredient in every product we make. Safe water also is vital to the sustainability of the communities we serve. WWF’s mission is the conservation of nature and the protection of natural resources for people and wildlife. Protecting freshwater ecosystems is a top priority in WWF’s work.
Now, through a partnership announced on June 5, 2007, we are combining our international strengths and resources to support water conservation throughout the world. ATLANTA, April 20, 2007 – The Coca-Cola Company today announced that it was implementing measures to reduce energy consumption at its two million square foot world headquarters by 23 percent and reduce its water consumption by nearly 15 percent. These efforts are expected to eliminate more than 10,000 metric tons of carbon dioxide emissions each year, which is the equivalent of removing 2,000 cars from the road.
taking bold measures to conserve natural resources in our own backyard, we want to send a message to companies and individuals that combating a leading global environmental problem demands local action,” said Bryan Jacob, the Coca-Cola Company’s energy and climate protection manager. “We all have a role to play, from using energy-efficient lighting where we can, to repairing leaky faucets and watering our lawns only in the morning and the evening.
Each leaky faucet in our homes or offices could be wasting 180 gallons of water per week.” (Reference 10) We have a role to play in helping the communities we rely upon. We know that to make a meaningful difference, we must focus our efforts beyond the confines of our own bottling plants.
Today, nearly one-sixth of the world’s population — more than 1 billion people — doesn’t have access to safe drinking water. Approximately 2.6 billion don’t have adequate sanitation. Due to the issues surrounding water, billions of people are vulnerable to disease and food insecurity.
We work closely with our supply chain, local communities, governments and nongovernment organizations to replenish water to nature and communities. In fact, since 2005 we have been involved in more than 250 community water partnerships in 70 countries to support locally relevant initiatives, such as watershed protection; expanding community drinking water and sanitation access; agricultural water use efficiency; and education and awareness programs. In 2009, we asked respected experts to work with us to calculate the water benefits of these projects. (Reference 11)
In the end we learned In Pakistan as compared to Pepsi, Coca-Cola has less number of consumers as Pepsi’s market share in Pakistan is approximately 58% where as coke market share is hovering about 32% but worldwide Coca-Cola has 60% whereas Pepsi has 30%. Coca-Cola’s environmental factors are positive The Company is working with teamwork by joining its all departments its resellers are the well known & reputable restaurants of the world it using two types of medium of distribution which are cost effective suppliers of Coca-Cola are local in Pakistan so it save lots of importing cost of raw material as we discuss above that coke brand known by 85% of the world population so they have massive consumers competition of Coca-Cola is very tough in Pakistan with Pepsi.
Its promoting Pakistan’s cultural Environment at its best level demographically coke fulfilling the consumer requirements in Pakistan. Coca-Cola working on natural environment to reduce co2 level in the globe & providing safe water to community. Socially Coca Cola is doing god work by providing scholarships & basic Educational program in Pakistan. Technology of Coca-Cola is very Competitive in this Modern Era.
DYNAMIC EQUIPMENT & CONTROLS (PVT) LTD.
F-1/23, Canal Cottages, Block-D New Muslim Town, Lahore 54000, Punjab, Pakistan URL: http://www.dynamic-eqpt.com.pk
http://www.dailytimes.com.pk/default.asp?page=story_24-12-2003_pg7_16 (Paragraph No 9)
Slogans of Coca Cola in Pakistan
1886 Drink Coca-Cola
1908 Get the genuine
1923 Enjoy thirst
1934 When it’s hard to get started, start with a Coca-Cola
1942 The only thing like Coca-Cola is Coca-Cola itself
1956 The friendliest drink on earth
1963 Things go better with Coke
1993 Always. Coca-Cola
2001 Life is Good
2003 Jo Chaho Ho Jaye Coca Cola Enjoy
2004 Flight Of Delight
2005 Galay Delicious Taste
2006 Thanda matlab coca cola
2007 khaly pily jila coca cola
2008 Aja jashan mena ly
2009 Always Coca Cola
Coke Classic Dite Coke
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