Coca Cola Case study
The Coca-Cola Company is a manufacturer of beverages. Europe, the Middle East, and Africa; Latin America; North America; Asia Pacific; Global Ventures; and Bottling Investments are among the company's operating segments. It promotes a wide range of beverage brands that it either owns outright or licenses, and it falls into categories such as emerging beverages, Coca-Cola, effervescent flavours, hydration, sports, coffee, and tea. More than 200 nations provide their goods to customers.
Vision and mission statement
The vision is to create the brands and beverage options that people like in order to revive their bodies and spirits, and to carry them out in a manner that builds a more sustainable company and a better shared future that improves the quality of life for individuals, communities, and the environment. The organization's mission is to improve society and the planet.
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Industry structure and economic feature
In the non-alcoholic beverages sector, there are companies that make and sell drinks that don't have alcohol in them. The market's scope includes bottled water, coffee, tea, soft drinks, juices, and other goods.
Some of the main developments in the sector are in line with the overall consumer goods trend of a stronger emphasis on health and wellbeing. This has been reflected in the non-alcoholic beverage market via fermented and functional drinks. Both types of goods aim to provide the user with benefits that go beyond basic flavouring or thirst relief. While fermented beverages such as kombucha emphasise the product's naturally occurring health benefits, particularly digestive health, functional water adds extra nutrients or naturally occurring compounds to the water.
Due to the effects of the coronavirus pandemic, the market for non-alcoholic drinks fell from a value of over 1.1 trillion dollars in 2019 to just over one trillion dollars in 2020. The market is anticipated to reach its peak in value by 2025, when it will be close to 1.4 trillion dollars. In 2019, China consumed more packaged drinks than any other country or area combined. Coca-Cola was the brand with the highest brand value in the non-alcoholic beverage category.
Corporate and business level strategies
Diversified and Optimized Brand Portfolio: A diverse range of drinks and brands provides the tools to seize this long-term growth potential. A wide range of organic brands, acquired brands, and collaborations make up for a streamlined portfolio, which offers a solid foundation for innovation that will spur interest and purchase behaviour among both new and seasoned customers.
Strong Global Value Share: They are continually in search of becoming an increasingly consumer-centric entire beverage business, and we are building on good foundations from the past. They now have a dominant position across the board for non-alcoholic ready-to-drink (NARTD) drinks. Outside of Dazzle, meanwhile, their high worldwide position is mostly a result of a strong presence in a small number of markets. As a result, they have a lengthy runway to take top positions outside of dazzling in the majority of markets.
Focused on the Core & Experimenting in Adjacencies: Everything begins with a solid foundation, and with their advanced skills in marketing, innovation, managing revenue growth, and execution, they stay laser-focused on bolstering that foundation. But this doesn't stop them from innovating carefully and thoughtfully by moving into related fields.
Coca-Cola is the most well-known company in its sector, and it produces a variety of goods to suit different consumer tastes. Coca-Cola promotes consumer pleasure and brand loyalty by focusing on each customer individually. This is one of the tricks to its enormous market dominance in the areas of carbonated and non-carbonated beverages.
Coca-Cola distinguishes itself from rivals like PepsiCo and Red Bull via its brand, price, and advertising techniques. Coca-Cola invests more money in marketing and advertising, which raises awareness of its brand. Additionally, it makes use of packages to ensure significant profits while offering its items at reasonable costs.
Large manufacturing facilities that provide economies of scale and robust distribution networks that serve a broad client base across all consumer demographics are where the firm gets its competitive edge. Coca-Cola is also well-known in developing countries, and its influence in the beverage market is likely to keep growing.
Coca Cola SWOT Analysis
- A well-known brand all across the globe is Coca-Cola. Its marketing initiatives were effective in creating a deep emotional connection with its clients, which considerably increased brand awareness. Coca-Cola increased its market share in the beverage sector via its product range and marketing tactics.
- In an effort to draw in consumers, the company makes ongoing investments in both its operations and goods. Coca-Cola continuously adjusts to the requirements and desires of its consumers by lowering the amount of sugar in its products and adding new flavours.
- The biggest issue with soda is its high sugar content, which increases the risk of health issues including diabetes and obesity. Coca-Cola's products are seen as unhealthy by some campaigners, which might hinder the company's future development if it doesn't handle health and nutrition concerns well.
- Coca-Cola uses non-biodegradable polymers to package its goods, making it a significant polluter. The business's image is being damaged by this and other unethical activities (such as taking advantage of workers in undeveloped nations). Additionally, as customers grow more environmentally concerned, they will search for less dangerous substitutes.
- Coca-Cola is a fantastic contender to launch new goods since it has a wide distribution network and a strong brand reputation. Non-beverage items, such as foods and medicines, may assist the business in further diversifying its product line as health and nutrition awareness develops around the globe.
- The beverage business has huge development potential in developing nations. Over the course of the prediction, middle-class consumers will grow considerably in emerging nations. A sizable, untapped customer base in developing nations will aid Coca-Cola in growing its footprint in these regions.
- The beverage market is quite competitive, and the best businesses have a lot of success. Coca-Cola is heavily contested by both direct and indirect rivals. Producers of soft drinks like PepsiCo and Dr Pepper Snapple Group Inc. are direct rivals. Beer and wine producers are indirect rivals.
- Legal disputes have always plagued Coca-Cola, most notably the claims of deceptive marketing of sweetened drinks. This is in light of ongoing worries about the health consequences of drinking sugary drinks. Legal disputes are becoming a bigger problem, harming the company's reputation and potential for future development.
- Political factors:Products from Coca-Cola are at the FDA's mercy. For their items to be placed on store shelves, they must adhere to government restrictions. Coca-Cola may be unable to sell drinks due to changes to existing legislation. Coca-Cola may be impacted by accounting, taxation, internal marketing, and changes to labour legislation.
- Economic factors:Products from Coca-Cola are sold in hundreds of nations. These nations each have their own set of traditions, cultures, preferences, and goals. In order to satisfy these consumers, Coca-Cola has updated and modified the way it manages its goods by developing new flavours. They have stock worth more than $80 billion. The beverage sector accounts for the bulk of that. And the majority of their income (approximately 70%) comes from nations other than the United States. However, individuals are seeking beverages that are more wholesome. Coca-Cola is making very little progress in that area.
- Social factors:The bulk of products are sold in developed nations. And they satisfy these clients' needs. To cater to Japanese customers, 30 different flavours were developed in Japan. Similar attempts are being made in China. People in America, however, prioritise their health. They are substituting waters and teas for sweetened beverages because these beverages are healthier for them. Coca-Cola must answer these demands by developing a product that the populace of healthy Americans will buy.
- Technological factors:Coca-Cola has been able to produce goods of greater and greater quality thanks to machinery. Coca-Cola has plants in Britain equipped with top-of-the-line equipment to guarantee quick turnaround times and high-calibre product development. Coca-Cola has reached out to audiences through social media technologies. Customers came up to snap pictures of the bottles with their names when the company started its name campaign, which included writing genuine names on the bottles. Social evidence was provided by these photographs' popularity on social media platforms like Facebook, which boosted Coca-Cola sales.
- Legal factors:Coca-Cola owns all business rights, including those for current and future products made with a patented method.
- Environmental factors:Water accessibility has an impact on Coca-Cola. The development of soft drinks requires water. But if anything were to happen, like climate change, the business may come in for criticism. However, since most of the products are soft drinks and there is a problem with water accessibility, the corporation will experience losses. Coca-Cola must abide by environmental regulations when they produce their goods. If anything goes wrong, it can impair how they distribute their goods or even cause them to cease making them altogether.
Target market analysis
Coca-Cola targets every consumer in the market, which has led to its enormous brand awareness. Its successful marketing segmentation is a key factor in this. The firm first focuses on young individuals between the ages of 10 and 35. They organise campaigns at universities, schools, and colleges and employ celebrities in their commercials to draw people to them. It develops packaging and sizes priced at different levels to increase affordability and cater to students, middle-class families, and low-income individuals. Coca-Cola specifically targets people based on their gender. For instance, men prefer Coke Zero and Thumbs Up owing to their powerful flavours, but women prefer Coca-Cola Light.
- Product:The product line for The Coca-Cola Company is extensive. It sells over 1.9 billion servings a day internationally and has more than 500 sparkling and still beverage brands. In the UK, it provides 80 beverages under 20 distinct labels. Throughout history, there has been an increase in public health concern about the effects of various beverages. Unsurprisingly, the Coca-Cola Company has responded quickly to the public's worries. One of the most valuable brands in the world is The Coca-Cola Company. Its goods come in a variety of shapes and sizes, allowing clients to choose the ideal serving size. Its bottles and cans are completely recyclable.
- Price:Business marketers may choose from a variety of pricing strategies, including loss leader pricing, discriminatory pricing, value pricing, and cost-plus pricing. Pepsi is Coca-Cola's global competitor. Both businesses provide comparable prices for their goods. In light of this, it may be claimed that Coca-Cola's strategy is competitive.
- Place:Products from Coca-Cola are available all around the globe. Its extensive network of distributors transports the goods to stores, marketplaces, cafés, restaurants, gift shops, and many other establishments across the world.
- Promotion:It should come as no surprise that the Coca-Cola Company invests billions of dollars each year in worldwide advertising. In actuality, it spends almost $4 billion on advertising each year. The Coca-Cola Company employs a range of marketing techniques to reach its target audience. For its marketing initiatives, it employs a variety of mediums. The corporation has used a variety of media venues, including TV, the Internet, newspapers, and social networking sites.
Problems and issues with Coca-Cola
Sugar, specifically sucrose, which is abundant in Coca-Cola and promotes tooth decay when consumed frequently, also plays a role in obesity. Both are serious health problems in the industrialised world. Type 2 diabetes is 26% more likely to develop in people who consume 1-2 cans of sugary drinks each day, according to research from the Harvard School of Public Health in 2015.
Results for the third quarter and nine months ending September 30, 2022, were released by The Coca-Cola Company. Sales for the third quarter were $11,063 million, up from $10,042 million in the same period last year, according to the business. Compared to a year earlier, net income increased to USD 2,825 million from USD 2,471 million. Basic earnings per share from ongoing operations increased to $0.65 from $0.57 in the prior year.
Coca-Cola is a global leader with one of the greatest market shares and one of the non-alcoholic beverage industry's pioneers. The business has a strong financial foundation. However, the business needs to think about releasing new health-conscious drinks on the market after the COVID-19 pandemic recovery.