Integrated Strategic Marketing Plan: Section
Two
Jessica Grimminger
Zachary Martin
Erin McIver
Russell Rowan
Ryan Village
Company
Overview
Coca-Cola has been a major player in the beverage industry
throughout the United States and international markets. The beverages are all
non-alcoholic and they include flavored water, sports drinks, and energy
drinks, ready-to-drink tea, coffees, dairy, and carbonated soft drinks.
Popularity for the original Coca-Cola is dwindling and Coca-Cola is working to
bring back customers with Coke Plus.
Business
Description
Coca-Cola is a corporation and their
headquarters is in Atlanta, Georgia. Coca-Cola is a beverage company and they
became incorporated in 1919. As of 2016 the company owned and licensed over 500
non-alcoholic beverage brands. (Reuters, n.d.) The red and white
Coca-Cola logo is recognized by 94% of the world’s population. Operating in 5
different regions of the world and encompassing over 200 countries, this makes
Coca-Cola the largest beverage company in the world. (Coca-Cola B, n.d.)
Company
History
An Atlanta pharmacist Dr. John S.
Pemberton created the Coca-Cola Company in 1886, his curiosity led him to
create a distinctive tasting soft drink that could be used and sold at soda
fountains. He created a flavored syrup and added carbonated water, and the
people who tasted the creation said it was “excellent” (World of Coca-Cola,
n.d.) Dr. Pemberton’s partner at the pharmacy called it Coca-Cola and
created the design for the logo that is known to this day.
· Coca-Cola (CC) used
Couponing in 1886 to market their product. (Coca-Cola)
· 1899 Coca-Cola is bottled
and sold around the United States. (World of Coca-Cola,
n.d.)
· 1906 “CC” Goes
international (Coca-Cola)
· 1916 the unique Coke
contour bottle was created. (World of Coca-Cola, n.d.)
· 1977 the Coke contour
bottle is trademarked. (World of Coca-Cola, n.d.)
· In the 1970’s Coke
connected with people with their brand of fun, friends and a good time. (World
of Coca-Cola, n.d.)
· 1980’s CC released Diet
Coke. (World of Coca-Cola, n.d.)
· In the 90’s the Coca-Cola
Polar bear came out and it has been success since then. People connect the
mischief, fun and innocence of the polar bear with Coca-Cola products. (World
of Coca-Cola, n.d.)
· As of 2016 CC is severed
over 1.7 Billion times daily. (Coca-Cola)
· 2017 Coke Plus is to be
released in Japan. (Coca-Cola)
Key
People
Coca-Cola employs over 700,000
individuals from around the world in order to operate one of the most
successful global brands. The leader of this company, Muhtar Kent, is
Chairman of the Board and CEO of Coca-Cola. Kent started with Coca-Cola
in 1978 and worked his way to the top of the organization when he assumed his
current position eight years ago. His commitment to the improvement of
the global business community is evidenced by active participation in a variety
of political, educational, and business boards around the world. James
Quincey is President and COO of the Coca-Cola corporation. According to
Coca-Cola’s official website, he plays a vital part in the organization “In
this role he has responsibility for all of the company's operating units
worldwide” (“Our Company,” para. 1, n.d.). Quincey has a variety of
strategic business experience due to previous high level operational roles.
Marcos de Quinto serves as Executive Vice President and Chief Marketing
Officer (CMO) of the Coca-Cola Company. Similar to Kent, De Quinto has
been with the organization since 1982 and is responsible for developing global
marketing strategies. These three key individuals head the organization
and establish the direction of Coca-Cola Company (“Our Company,” n.d.).
Location
and Subsidiaries
According to Coca-Cola’s main website,
the company was founded in 1886 in Atlanta, Georgia by John Pemberton and
remains the corporate headquarters today (“Who We Are,” n.d.). Coca-Cola
services over 200 countries in regions including Asia Pacific, Europe, the
Middle East, Africa, Latin America, and North America. Essentially,
Coca-Cola can be found in any part of the world due to their extensive
distribution network and recognizable brand. As far as subsidiaries are
concerned, Coca-Cola holds a variety of stake in many other companies. In
the article “The Top 5 Companies Owned by Coca Cola (KO)” by Nathan Buehler, he
explains that Coca-Cola subsidiaries include Monster Energy, FUZE,
Vitaminwater, Minute Maid, and the Bottlers Investment Group. As a
result, these companies have benefitted from the huge network created by Coca-Cola
in order to be provided in stores, gas stations, and vending machines globally.
These subsidiaries combined with the vast location network developed by
Coca-Cola are the main factors contributing to their sustained success (“Who We
Are,” n.d.).
Brands,
Major Products, and Services
Coca-Cola has an impressive list of
brands and products that are recognized both nationally and overseas.
These include brands such as Coke, Sprite, Fanta, Powerade, and Mello
Yello in addition to the subsidiaries previously mentioned. These major
products are sold in markets around the world, to age groups both young and
old. The popularity of these brand name products has facilitated
organizational growth and expanded product offerings annually. It is a
core strategy of Coca-Cola to increase its portfolio in order to maintain its
position as the market leader in the beverage industry (“Brands,” n.d.).
Corporate
Vision
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 (The Coca-Cola Company, n.d.). Coca-Cola offers a great work
environment, where people are inspired to be the best they can be. We offer to
the world a unique portfolio of quality beverages that satisfy people’s desires
and needs. Our partnerships ensure a winning network of customers and suppliers
that create one of a kind value. Our vision is to make a difference in the
world we live in, by helping build and support sustainable communities,
maximize long-term return to shareholders, and maintain a highly effective and
fast-moving organization.
Corporate
Mission
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 (The Coca-Cola Company,
n.d.).
· To refresh the world...
· To inspire moments of optimism and
happiness...
· To create value and make a difference.
Promotional
Strategy
Coca-Cola just recently announced that
for the first time, all Coke Trademark brands will be united in one global
creative campaign: “Taste the Feeling” (Moye, 2016). This strategy focuses
on the iconic appeal of the world’s number one beverage brand to Coca-Cola
Light/Diet Coca-Cola, Coca-Cola Zero, Coca-Cola Life, and the all new Coca-Cola
Plus. Through this promotional strategy, we can show our commitment to choice,
offering consumers whichever Coca-Cola suits their taste, lifestyle, and diet –
with or without calories, with or without caffeine, and with or without
healthier alternatives. We are reinforcing that Coca-Cola is one brand with
different variants for everyone, all of which share the same values and visual
iconography (Moye, 2016).
Product
Sales History
Coca-Cola, with its 3,500 products, is
the world leader among soft drinks with a 44 percent market share (Trefis
Team, n.d.). Approximately
1.8 billion bottles of coke are sold every day and 10,450 Coca-Cola brand
drinks are consumed every second, bringing in a total Annual Revenue of $47.51
billion ("Coca-Cola Company Statistics – Statistic Brain,"
n.d.).
Coca-Cola
was originally created by Pharmacist Dr. John Styth Pemberton in 1886. Only 25
bottles were sold its first year ("Coca-Cola Company Statistics –
Statistic Brain," n.d.).
Coca-Cola was incorporated in 1892. Three years later, in 1895 it was sold in
every U.S. state. By 1916 Coca-Cola was being sold in Cuba, Jamaica, Bermuda,
Puerto Rico, England, France, Germany, and the Philippines. Today, Coca-Cola
products are sold in 200 countries worldwide ("Coca-Cola Company
facts, information, pictures | Encyclopedia.com articles about The Coca-Cola
Company," n.d.).
For
decades Coca-Cola was hesitant to extend its trade mark to other products,
however, in the 1980’s with consumers gravitating toward low calorie beverages,
Coca-Cola created Diet Coke. Released in 1982, Diet Coke was the first new
trade mark brand for Coca-Cola since 1886. Today, Diet Coke holds a 15 percent
market share and is considered the number two beverage ("Coca-Cola
Company Statistics – Statistic Brain," n.d.). The next extension of the Coke trade mark came in 1985
with the release of Cherry Coke.
In
2016, Coca-Cola had six brands listed as the most valuable soft drink brands
worldwide. Coke topped the list with a brand value of $67,749 million. Diet
Coke came in second with a worldwide brand value of $12,565 million ("•
Soft drink brands: brand value of top selling brands 2016 | Statista,"
n.d.). Fanta was ranked
seventh, with a $5,637 million value, Sprite was in the tenth spot with $5,236
million, Dr. Pepper was in the thirteenth spot at $2,687 million, and Minute
Made was ranked in the fourteenth spot with a worldwide market value of $2,644
million ("• Soft drink brands: brand value of top selling brands
2016 | Statista," n.d.).
Although
the Coca-Cola Company has seen slowly declining sales consistently since 2012,
this decline can be reversed with the introduction of new products and
marketing focus on other strong brands within the company.
Current
Marketing Objective
Currently, Coca-Cola’s marketing
objective is to increase sales by bringing the brand closer to the consumer on
an emotional level. To accomplish this, Coca- Cola has launched a new marketing
strategy called “Taste the Feeling.” This campaign, through a one brand
approach, will be extending the iconic appeal of Coke to the other trade mark
brands such as Diet Coke, Coke Zero, and Coke Life.
The
objective of the “Taste the Feeling” campaign will show the correlation between
the product and how it makes everyday moments more special, by displaying both
the functional and emotional aspects of the brand experience. Through T.V.
Commercials, print ads, and digital storytelling, The Coca- Cola Company will
be aiming to remind their consumers about why they love the brand.
Media
Expenditure
In
2016, Coca- Cola had a total advertising budget of four billion dollars.
Television advertisements make up the bulk of this budget with spending at $1.9
billion (Trefis Team, n.d.).
However, Coca-Cola has recently discovered that mobile video offers a much
higher return on investment. In order to drive profit, the Coca-Cola Company
has started investing 15 percent of their advertising budget into creating
mobile videos ("Higher mobile budgets correlate to higher revenue,
says Coca-Cola exec | Mobile Marketer," n.d.).
Part
2- SWOT Analysis
A. Strengths
There is no denying that Coca-Cola is a
well-known brand. Even in many other countries, the companies red and white
logo is easily recognizable. Because of this, it is number four on Forbes’ 2016
list of “Most Valuable Brands” (Forbes, 2016). It is worth noting that their
main competitor PepsiCo, is listed as number 29 on this same list (Forbes,
2016). Brands that are easily recognizable tend to be more popular and have
higher sales figures. This basically means that their strength is in their
stability.
Another strength that the Coca-Cola
Company has is its large distribution network. They are able to meet the needs
of customers all over the world because of their unique system. The main
company owns the brand and is responsible for global marketing efforts, but
they actually do not bottle or distribute the final products. They manufacture
the syrups and concentrates and then send them off to “bottling partners” in
local communities. The bottling partners are in charge of “manufacturing,
packaging, merchandising, and distributing the final branded beverages to our
customers and vending partners, who then sell our products to consumers”. This
strategy allows the bottling partners to distribute based on the specific needs
of their local community. (Coca-Cola A, n.d.)
B. Weaknesses
One weakness for Coca- Cola that has
been going on for quite a while is the negative publicity associated with
health concerns. Around the mid-90’s to mid-2000’s era, an uptick of obesity in
Americans had researchers pointing their fingers at fast food and soda
companies (Suddath, 2014). Coca-Cola took a lot of the heat, and has seen a
decline in sales (along with many other soda companies) since its peak in the
late 80’s (Suddath, 2014). The problem is that research has made it hard for
the company to deny that their main product is not a possible reason for
national health concerns, so they have had to bite the bullet, admit to their
products problems, and try to come up with healthier alternatives.
Another one of Coca-Cola’s weaknesses is
the public’s concern over the company’s water usage. In 2007, news broke that
Coca-Cola was taking control of the subterranean aquifers in some of the more
underdeveloped countries in which it operated (War on Want, 2007). And
considering it takes three liters of water just to make one liter of the
finished products, many social justice groups and local communities were
understandably upset (War on Want, 2007). The biggest issue with overcoming the
water sustainability problem is that the process to make Coca-Cola will always
require more water than what is in the finished product. Even though the
company has made steps to lessen the excessive water usage (down to using 2
liters by 2015), there is still a lot of public disapproval put on their
tapping into natural resources (Coca-Cola, 2017) (War on Want, 2007).
C. Opportunities
While new health trends may have caused
headaches for the Coca-Cola Company, they are also a source of possible growth.
The company will be able to expand their current options in ways that may not
have been accepted by consumers in the past (Suddath, 2014). For instance, with
Coca-Cola Plus, the company can appeal to consumers looking for the newest
health trend. This meshes the ideal of trendiness and the classic Coca-Cola
taste, without going too far into the trends which can sometimes limit the size
of consumer market.
Coca-Cola should also continue taking
advantage of the advertising opportunities for younger markets. Younger
generations have grown up with Coca-Cola and know the brand well, but they have
also seen the tremendous shift in perspective caused by the rise in obesity.
This negative narrative will only grow stronger if the youngest generations are
ignored by the company’s marketing campaigns. However, by tapping into the
culture of e-sports (gaming tournaments with online viewers or audiences in
stadiums), Coca-Cola could become a major player in the minds of younger
consumers.
D. Threat
As consumer’s tastes change, Coca-Cola
has not been the only company that has had to change its offerings. The company
now has to deal with incoming products from brands such as Dr. Pepper Snapple
Group and PepsiCo. Dr. Pepper Snapple Group has recently introduced Bai, a
fruit water drink that has little sugar and other artificial ingredients (Dr.
Pepper Snapple Group, 2017). And PepsiCo has been doing well offering its Naked
brand juices as a premium health drink offering (PepsiCo, 2017). It is also
worth noting that Pepsi has recently started offering a new mix of their
popular soda with 30% less sugar and no artificial sweeteners as Pepsi Next
(Pepsi Next, 2015). This could be a threat to the success of the new
‘good-for-you’ offering Coca-Cola Plus
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