Executive Summary
Customers want more moisturizing, revitalizing, and reparative refreshments. Firms are creating products to meet clients’ dietary, medical, and ecological requirements. Coca-Cola used the marketing approach of growing markets, expanding territory, and developing economies to comprehend the marketplace. While COVID-19 enhanced beverage sales, beverage companies will strive to achieve their record-breaking earnings in 2020. Between 2021 and 2025, the soft drinks sector is expected to grow by USD 455.17 billion, or 8.67% annually. Coca-Cola’s sales promotion tactics encompass the 4Ps: product, price, location, and promotion. These Coca-Cola commercial mixtures benefit the company. Coca-marketing Cola’s strategy keeps it competitive and achieves its goals. Coca-main Cola’s rival is PepsiCo, and both companies have long controlled the non-alcoholic beverage market in many countries. Unlike Pepsi, Coca Cola is always trying to win individuals’ hearts. Unlike Pepsi, which has an inconsistent target demographic of adolescents, Coca-Cola resonates with all demographics.
Consumer Market
Customers demand more multifunctional beverages with moisturizing, refreshing, and reparative characteristics. Companies are designing products to fulfill consumers’ nutritional and medicinal needs and their need for clean, non-GMO, and environmental components (Li & Dorfman, 2019). With 65% of the world’s population under 35 years, it is excellent market segmentation for soft drinks, with companies investing considerably in commercial and advertising development (Li & Dorfman, 2019). Consumer demand and preferences are changing, demanding new ways to keep existing clients and attract new ones.
Business Market
Industry market analysis is a strategic approach to splitting the marketplace depending on the volume and capacity of customers and employing suitable strategies to increase sales and make profits from each section. Coca-Cola adopted the marketing concept to understand the market as per developing markets, expanding territories and advanced economies since each nation in the 200 plus regions plays a significant growth function (Mothersbaugh et al., 2020). In evolving industries, the central emphasis was on raising the inventory levels rather than revenues to grow its subscriber base and establish a firm framework for the company’s success. Therefore, this was achieved by selling beverages at cheap costs so that more consumers could relish it (Mothersbaugh et al., 2020). In poor regions, a compromise was made between quantity supplied and pricing. In industrialized countries, the emphasis was on generating income by providing more compact packages and premium brands like glassware and aluminum containers.
Market Trends and Growths
The epidemic of COVID-19 has had a detrimental effect on the soft beverages beverage sector. Due to confinement and interpersonal distancing practices, significant corporations have ceased operations in various regions. While beverage sales increased during the COVID-19 epidemic, beverage firms will struggle to duplicate the record-breaking profits of 2020. Between 2021 and 2025, the soft drinks industry is predicted to expand by USD 455.17 billion, and the market’s development velocity will quicken at an 8.67% compound annual growth rate (Nair et al., 2021). While the contents of a beverage frequently influence soft drink beverage trends, the container itself is another crucial component that is becoming crucially influential as questions about sustainability grow.
Marketing Research
Marketing research is primarily concerned with assisting businesses; it does so by ensuring that the firm makes sound business decisions. Marketplace analysis is divided into three areas known as consumers, rivals, and the entire competitive landscape (Singaram et al., 2019). These three components are referred to as the marketing research areas. Coca-Cola performs market surveys using advertising concepts to guarantee they provide their customers with what they desire. For instance, they conduct research using surveys to ascertain which flavors consumers prefer and which they dislike. To compare commodities, pricing, logistics operations, and positioning campaigns (Singaram et al., 2019). The final piece of research they need to conduct is on the trading environment; Coca-Cola will accomplish this to determine the client base for their merchandise.
PESTEL Analysis
Political Factors
Coca-Cola can directly influence food commodities through federal regulatory requirements. These restrictions may differ across countries, as seen in the prohibition of Coca-Cola sales in Burma due to US-Burma trade tariffs. After nearly six decades, the sale resumed in 2012, following the suspension of the punitive measures (Dimitrescu et al., 2018). Additionally, given the current political situation in Cuba and North Korea, Coca-Cola cannot be purchased or sold in these jurisdictions. Finally, the recent trade dispute between the United States and China has significantly influenced the cost of Coca-Cola beverages.
Economic Factors
The massive intake of water has had several effects on Coca-Cola. The corporation is compelled to spend a significant portion of its budget resolving water situation challenges and ensuring that its water requirements are met. The worldwide economic downturn has also hurt the corporation badly. In too many nations, Coca-Cola is still viewed as a premium product. In emergency moments, such commodities are sure to reduce profits (Dimitrescu et al., 2018). Coca-Cola utilizes some essential resources to manufacture its beverages, and these components are continually rising in price.
Socio-Cultural Factors
The most significant societal element affecting Coca-Cola is the shift in consumer thinking. Customers in the millennial and Gen-X generations are rapidly migrating away from carbonated beverages in favor of caffeinated drinks due to the health risks associated with the latter (Dimitrescu et al., 2018). Disorders such as overweight are connected with long-term Coca-Cola use, and these associations have been highlighted in recent years. The general public’s thinking has shifted toward a healthy lifestyle, and Coca-Cola is not a good product in this environment.
Technological Factors
Social media marketing has been shown to be beneficial for the organization. It has one of the most significant follower counts across all online network channels, and it aggressively uses these connections to advertise its products. Coca-Cola presently has 108 million Facebook fans, 3.34 million Twitter followers, and similar amounts on other sites (Dimitrescu et al., 2018). As a result, these venues are the principal means the brand communicates with its potential customers.
Environmental Factors
Coca Cola is widely regarded as the world’s largest client of freshwater; for this rationale alone, the corporation has encountered widespread opposition from conservation activists. Coca-Cola is being made responsible in nations such as India for emptying significant groundwater sections. Due to global warming, the global spread of humid climates has proven helpful to the corporation (Dimitrescu et al., 2018). It can now effectively expand its operating efficiency in territories where expansion was previously impossible.
Legal Factors
Coca-Cola’s principal legal challenge is complying with the relevant ordinances of the nations in which it operates. Numerous countries have enacted legislation regulating caffeine limits and sugar intake (Dimitrescu et al., 2018). The brand must guarantee that it complies with all applicable requirements in each location where its merchandise is sold. Coca-Cola has been sued in the past over the levels of caffeine added to their drinks in various nations.
Competitor Analysis
The soft drink sector is one of the most competitive globally; with so many options, customers frequently struggle to choose the most appropriate drink for them. PepsiCo is Coca-Cola’s primary competitor, and predictably, these corporations have long dominated the non-alcoholic refreshment business in several nations (Dai, 2021). There are other companies on the scene, and it is essential to note that private premium brand beverage manufacturers have the most sales in the country, followed by Coca-Cola and PepsiCo. China’s economy is accelerating its growth and dramatically improving the demographic situations of millions of individuals (Dai, 2021). Many people now spend significant money on healthy drinks such as fruit juice, filtered water, tea drinks, and others.
SWOT Analysis
Strengths
- Superb marketing techniques – Coca Cola, unlike Pepsi, is constantly attempting to win people’s hearts. Whereas Pepsi’s target audience changes frequently and is geared toward children, Coca-Cola appeals to individuals of all ages. Well-known celebrities also carry brandings, such as Aishwarya Rai, Amitabh Bacchan, and Aamir Khan (Abbasi, 2017).
- Consumer loyalty – With such powerful commodities, it is unsurprising that Coca-Cola enjoys such high levels of client loyalty. Coca-Cola and Fanta, for example, have a sizable fan base. Abbasi (2017) insinuates that consumers, above others, will prefer these beverages. Due to the superior flavor of Coca-Cola, it becomes challenging for the client to locate replacements.
Weaknesses
- Lower Commodity Differentiation – Whereas Pepsi has made a wise move by diversifying into the snacks category with goods such as Kurkure and Lays, Coca-Cola has remained mostly absent from that category. Additionally, the segment generates money for Pepsi, and had Coca-Cola been included in this section, these goods would have generated additional income for the corporation (Abbasi, 2017).
Opportunities
- Diversification – specialization in the production and nutrition industries will enhance Coca-Cola’s offers to its customers. Thus, this also ensures that they maximize revenue from existing clients through cross-selling.
- Enhancement in distribution network – supply chain management may be a significant cost sinkhole as delivery prices rise. Logistics and transportation underpin Coca-Cola’s whole operation. Therefore, Coca-Cola should maintain a close eye on its distribution operations and continue to improve to reduce costs.
Threats
- Indirect rivals – Coffeehouse brands such as Starbucks, Café Coffee Day, and Costa Coffee are growing in popularity (Susilo, 2021). These establishments provide a healthy alternative to Coca-Cola’s fizzy beverages. They may not pose a significant threat to Coke, but they do dent its beverage industry.
Key Issues
Coca-Cola already has a diverse portfolio of beverage brands and waters that have the potential to be profitable. Still, they must proceed to invent new health and wellbeing angles for their franchises. Usable and energy beverages could be a substantial growth domain (Chua et al., 2020). While Coke continues to thrive in emerging economies, it has faced intense competition from local manufacturers, and its closest rival, Pepsi Co., seeks to grow in these markets (Chua et al., 2020). With authorities and the mainstream press highlighting obesity issues on a global scale, the sugar content of soft drinks has attracted significant attention. While the Coca-Cola Company has invented low- and zero-calorie beverages that are market leaders in their respective classifications, the segment is sluggish in the United States, owing to consumer concerns about alternate solution sweeteners.
Mission, Direction, and Objective
Financial Objective
The Coca-Cola Company’s possibilities instill conviction in the corporation’s capacity to create long-term, continuous value for shareholders. The organization’s long-term objectives include good earnings growth of 4% to 6%, higher working leverage that results in 6% to 8% corporate income gains, considerable earnings per share (EPS) improvement, and an increase in free cash flow translation (Zhang, 2019). The firm’s emphasis elements continue to be the two drive shafts that power its total beverage company tactic, enabling it to turn top-line revenue into profit maximization.
Marketing Objective
Coca-Cola advertising campaigns are designed to accomplish specific goals. Profit maximization is the primary objective of the business, and various advertising strategies contribute to this goal in a variety of ways (Singaram et al., 2019). The marketing aims of the corporation include informing and educating consumers and purchasers, establishing a preference for the company’s products over those of competitors, and encouraging product trials among possible new customers.
Societal Objectives
The Coca-Cola Company has several agreements to protect and enhance the environment through recycling, water efficiency, carbon reduction, and trash cleanup. Coca-Cola also stressed the importance of all employees volunteering in their communities. Coca-Cola is committed to creating a positive influence in the communities it operates by collaborating with local stakeholders and encouraging work engagement. It has developed relationships with local businesses and provides work-related training and coaching through instruction centers.
Marketing Strategy
Targeting and Positioning Decisions
Coca-Cola does not target a particular demographic but modifies its marketing approach by establishing novel goods. Typically Coke reaches everyone; it does not have a specific target; however, it focuses mainly on 12 to 30 years old individuals (Nadube & Didia, 2018). Even though there is no unique feature or message for the age bracket, the company thrives in contacting them through collaborations. Therefore, addressing the young generation might be a helpful marketing technique for the organization. It faces a vital dilemma of sustaining its presence at the same level or adjusting as per 200 nations where the business conducts business. Coca should be willing to preserve the same essential commodity, Coke, but instead modifies the service to people’s requirements (Nadube & Didia, 2018). The firm employs a competitive plan to have the same impression all around the universe, which is an accomplishment since it is viewed now as a part of daily life everywhere.
Product and Brand Decisions
Coca-Cola is one of the most recognized brands globally and has been for generations. The beverage firm makes its money by appealing to nostalgia, community, and gratifying flavor. This focus is crucial to the soft drink business’s brand strategy and influences every move, from social media labeling and product endorsements to promotion and product innovation. Coca-Cola and Pepsi are textbook examples of trademark adversaries, and because their commodities are so comparable, branding and client impressions are critical. Coca-Cola’s perception of the beverage has a different effect on the minds of its buyers.
Pricing Decision
Coca-Cola bases its pricing decisions on its cost structure, which they describe as meet-the-competition selling. Coca-Cola products are priced similarly to their opponents, as Coca-Cola has to be recognized as unique while being accessible. Coca-Cola leverages reduced price segments to meet new marketplaces that are very price-conscious (Li et al., 2018). They compete on price to increase brand exposure and readjust itself as a luxury product in relation to its myriad opponents, such as Pepsi.
Channel and Logistics Decisions
The Coca-Cola Corporation is a multinational corporation that functions locally in each town in which it operates. While it is widely believed that Coca-Cola manages all of its operations worldwide, this is accomplished through various local networks (Kirillova, 2020). The corporation manufactures and sells to packaging companies’ concentrations, drink ingredients, and flavorings. The company can achieve global reach while remaining focused on local markets through a robust distribution channel that includes more than 250 bottling companies globally (Kirillova, 2020). Packaging collaborators make, package, and deliver finished trademarked beverages to buyers and vending parties, subsequently selling to consumers.
Marketing Communication Decisions
Currently, the firm organizes interactions through the following channels: advertisement, direct promotion, online or engaging marketing, promotional offers, public affairs, individual sales, and sponsorship adverts. Marketing is critical for this organization, as its massive client base spans the globe. The corporation employs persuasive marketing tactics to accomplish this successfully and attract new clients from abroad. The words used in Coca-Cola advertisements are so memorable and relevant that they leave a lasting impression on viewers.
Marketing Programs
Coca-Cola’s marketing strategy comprises the 4Ps: product, price, place, and promotion. These Coca-Cola advertisement blends help the firm succeed. Coca-marketing Cola’s tactic helps it stay competitive and accomplish its corporate aims. First, recognizing Coca-Cola’s large product variety helps comprehend its promotional mix. Fanta, Minute Maid, Coca Cola, Coca Cola Life, Diet Coke, and Dasani (Kirillova, 2020). Second, Coca-Cola’s marketing mix includes second-degree pricing discrimination where it charges varying costs for different things.
Coca-Cola and Pepsi are the top contenders in an oligopolistic market structure with few vendors and many purchasers. Third, Coca-Cola has an intensive distribution strategy, having been in business for over 130 years and functioning in over 200 countries (Kirillova, 2020). The widespread distribution network reflects the Coca-Cola location strategy. Coca-Cola manufactures the beverages and ships it to bottlers across the world. Finally, the Coca-Cola marketing plans can be explained as follows. Coca-Cola’s promotional strategy centers on aggressive advertising via TV, the internet, print, and endorsements.
Coordinating networks to meet shifting consumption is a significant concern for beverage companies today, fulfilling ever-changing client demand while maintaining control of delivery costs. Coca-Cola is a client-centric company that seeks to add value to its consumers through corporate growth and market execution excellence. The company grows by assisting its users in growing their businesses by utilizing a 24/7 assortment and differentiated sales implementation to develop the broader beverage sector, focusing on high-value opportunities and performing with competence.
Internal promotion is a series of processes designed to communicate an institution’s mission and goals to its workforce. These techniques are motivated by various objectives, including enhancing employee involvement and retention. Coca-Cola educates its employees about the organization’s background and purpose as part of its internal marketing scheme. Additionally, it is a critical step toward developing an integrated workplace culture. By fostering a sense of belonging among its personnel, the company may increase the likelihood of brand awareness.
Forecasting and Financial Details
To successfully market Coca-Cola’s products, it is essential to provide projected costs incurred, earnings to be received, and sales forecasts. Coca-Cola Company has a vast customer base worldwide and, therefore, it is expected that the institution spends much on promotional activities. However, most economies are still recovering from the impacts presented by COVID-19 on business activities. Therefore, Coca-Cola does not anticipate much profits and revenues despite the relatively high cost of production.
Table 1: Projected Costs and Profits, Revenue Forecasts, and Sales Forecasts (Talbot, 2019)
Implementation and Control
Schedule for Implementation
Execution of marketing tactic is converting a promotional plan into tangible actions: assignments and initiatives, assigned personnel, and schedules. Coca-Cola’s first step would be to regulate everyone’s aspirations, including its investors, personnel, and the firm. As a result, undesirable pressure will be relieved, and space for experimentation and iterations will be created. Second, Coca-Cola would ascertain the resources necessary to carry out the operational framework. Coca-Cola’s marketing strategy is unusual in that it is focused on the items or improvements it is introducing, the indicators it wishes to achieve, and the earnings it intends to win. Finally, after establishing a marketing approach, workforce, strategies, and quantitative techniques, the corporation should convey the plan to all stakeholders. Accountability and responsibility within a team can increase enthusiasm, performance, and outcomes.
Metrics for Measuring Progress
Coca-Cola uses a customer satisfaction score to determine the effectiveness of its offering or commodity, and the results of consumer surveys inform this metric. The customer satisfaction index (CSI) is the most extensively used method of determining client experience (Golovkova et al., 2019). Additionally, Coca-Cola utilizes earned value, which gives strategic direction by illustrating how much benefit the corporation has generated from total expenditure on its commodities (Golovkova et al., 2019). It contrasts the value of work performed by a specified date to the proposal’s budget target.
Contingency Plan
An emergency plan is a strategy developed to assist an institution in appropriately responding to an extensive future occurrence or crisis that may or may not occur. Multiple international insurance initiatives have been introduced to help Coca-Cola mitigate risk of loss (Obal & Gao, 2019). Coca-Cola is generally self-insured for a substantial amount of various claims; nevertheless, it utilizes comprehensive insurance to supplement its self-insured reliabilities to minimize the firm’s risk of marketing loss. Coca-Cola’s self-insured costs are estimated using corporate sector actuarial techniques and industry estimates, adjusted for its unique predictions based on its claim background.
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