Last Paper Fixes and Sections

PRODUCT OVER VIEW - 1

Product Overview

            The product is Coca-Cola and it is the best selling and most popular soft drink in history. It was created in Atlanta, Georgia in 1886 by Dr. John S. Pemberton and was at first a fountain only beverage.  In 1899 Coca-Cola began bottling it’s product and selling it throughout the United States and in 1906, Coca-Cola expanded to selling internationally. To this day Coca-Cola is one of the most recognizable brands in the world. (Coca-Cola )

Problem Statement and Issues

            The problem is customers are losing a taste for Coca-Cola products and soft drinks in general. By the year 2019, there is a 30% decline in carbonated beverage sales. Customers are now buying sport type drinks and energy drinks, and this has cut into the profits Coca-Cola once had. (The Guardian) The trends of healthfulness has led to customers moving from calorie rich products, to more natural drinks. (The Guardian)

Advertising and Marketing Objectives- Our Recommendations

            The main advertising and marketing objectives in this campaign are to improve the quality of marketing in order to reach current target markets and those that still remain relatively underfunded (Coca-Cola remodel). Underfunded markets would be those supporting a healthier greener lifestyle. The objective for underfunded markets would be to increase sales by 100% (Coca-Cola remodel). This will aid in Coca-Cola’s second objective which is to reinvigorate company growth.

Aims of your campaign

Our campaign is aimed at how Coca-Cola is using healthier ingredients in the creation of New Coca-Cola products. The new and improved pop ingredients and healthier beverage options are the new direction of Coca-Cola. Keeping the original flavor, and becoming and healthier drink, is what consumers want.

 

THE COMPANY – 3.

Company Overview

Coca-Cola has been a major player in the beverage industry throughout the United States and international markets. The beverages are all none 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 ) 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) 

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) Dr Pemberton’s partner at the pharmacy called it Coca-Cola and crated the design for the logo that is know to this day.

·      Coca-Cola (CC) used Couponing in 1886 to market their product

·      1899 Coca-Cola is bottled and sold around the United States

·      1906 “CC” Goes international

·      1916 The unique Coke contour bottle was created.

·      1977 the Coke contour bottle is trademarked.

·      In the 1970’s Coke connected with people with their brand of fun, friends and a good time.

·      1980’s CC released Diet Coke.

·      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.

·      As of 2016 CC is severed over 1.7 Billion times daily.

·      2017 Coke Plus is to be released in Japan.

   

   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 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.).

INDUSTRY AND MARKET PLACE - 5

Industry Definition

            Coca-Cola is a product sold within the Soft Drink Industry under the category of carbonated soft drinks. The Soft Drink Industry is based on the production, distribution, and marketing of nonalcoholic water-based beverages. This industry has a history extending back to the 1700’s when a British chemist, Joseph Priestly, discovered a way to synthetically carbonate water.

Industry

            This Industry as a whole can be seen as an Oligopoly due to there being only two firms controlling the vast majority of the market with a 70% (Bailey, 2014) market share. These two firms would be the Coca-Cola Company and Pepsi Co. This industry also has very high barriers for new entrants due to high operating costs. The two major firms with in the industry also use non-price product differentiation in order to compete.

            Over the past few years, the carbonated soft drink category has seen declined sales throughout the industry. This is due to increased health awareness among consumers on the side effects of many of the ingredients used in these beverages, including sugar. Soft drink manufacturers have been receiving pressure to create low calorie beverages with less sugar. Due to this pressure, the three largest soft drink manufacturers with in the industry, Coca-Cola Company, Pepsi Co., and Dr. Pepper Snapple Group Inc., have ensured that over the next decade they will aim to reduce high sugar beverages by 20% (Bailey, 2014). The Soft Drink Industry is shifting in products to meet these new consumer demands. This shift in demand is offering this industry the opportunity to grow in different markets such as the non-carbonated category of the Soft Drink Industry.

The Marketplace

·                ·      Supermarkets/Grocery Stores these are the largest source of revenue for the beverage industry and 41.2% of their total revenue. (Ibisworld)

·                ·      Gas stations/Connivance Stores these are key for this industry because they are usually open 24 hours. These stores represent 19.9% of the total revenue. (Ibisworld)

·                ·      Vending machines these are placed where consumers have not alternative. Bus stations, airports, work places, etc. These currently account for 14.4% but this number is decreasing due to healthier options that are not being put into vending machines. (Ibisworld)

·                ·      Warehouse centers/ Club stores, they make up 12% of the beverage industry revenue and this is stable and going to increase. (Ibisworld)

·                ·      Other retailers such as restaurants, liquor stores and online retailers make up the rest of the industries revenues.(Ibisworld)

Current Condition of the Marketplace

The marketplace for the beverage industry is different than it once was. Major beverage companies are about developing new healthybeverages. If they are not doing that, they are at least trying to conceive a healthier image.https://www.blogger.com/null (Taylor, 2016) Also pushing the beverages to be single serve, this will help the healthier image, the companies are trying to achieve. With all competition creating healthier versions of their main soft drink, Cokes answer to this is Coca-Cola Plus. The soda and beverage industry is currently at an annual growth of -1.3% and being that it is in the mature lifecycle it will be difficult for the industry to bounce back. (Ibisworld) The soda and beverage industry is increasing in the import and export markets.

Consumer Stakeholder - 7

Physiographic

Coca-Cola is a global brand and the only 2 countries in the world that do not sell it are North Korea and Cuba. (BBC) The country that drinks the most is Mexico, then the United States followed by Canada. The lowest 2 countries for Coca-Cola consumption are China and India and this is where Coca-Cola is looking to expand. (Franklin) Coca-Cola sales have been declining in North America and Europe, but have been increasing in Asia. (Coca-Cola sales decline in key countries) North American and European countries are looking for healthier alternatives this is why Coca-Cola Life is headed to these continents to be purchased.

Stakeholder’s Characteristics

·      Bottling Partners – group meetings to plan future strategic plans. Top senior to top senior communication and Global environmental council. (Stakeholder Engagement) This group has a lower influence on the types of products Coke produces but they have a high interest. Coca-Cola “CC” keeps these companies working by selling large amounts of CC products.

·      Consumers – (Stakeholder Engagement) This group has high influence on CC because they buy the products and are the data CC uses to sell products.

·      Governments and regulatory authorities – Chambers of commerce, foreign investment councils and recycling and recovery initiatives. (Stakeholder Engagement) High interest and high influence, CC is an American company and them expanding into other countries is good for American industry. Foreign investment councils are used for CC to make a decision about a specific area of the world and why may or may not sell in those countires.

·      Shareowners and analysts – (Stakeholder Engagement) High interest and high influence, these people have invested money into CC and they want the company to succeed.

·      Suppliers – Annual supplier meetings, supplier guideline principles and packaging associations. (Stakeholder Engagement) High interest and low influence, the supplier companies need CC to succeed.

·      Golden Triangle approach is a business practice Coca-Cola uses. The approach involves engaging public, private and civil society sectors to create a collective business partnership. Coca-Cola works with these 3 groups for business, and believes working together is better than working in isolation. Coca-Cola can have sustainable business growth, environmental stewardship and social programs using the Golden Triangle approach. (Stakeholder Engagement)

Primary Stakeholders

            Primary Stakeholders for the Coca-Cola Company are those that are directly affected by this organization. The groups who are directly affected by the decisions and actions of the Coca-Cola Company are: Customers, Employees, and Shareholders. To drive engagement with these key stakeholders, the Coca-Cola Company utilizes different formal and informal methods. These methods allow for development of strategies to ensure stakeholder’s objectives are met.

            Coca-Cola customers want great value for their money. To facilitate engagement with these stakeholders, Coca- Cola uses formal methods to drive engagement such joint business planning. This allows Coca-Cola a large network of suppliers for customers to easily gain access to their products. Not only does this allow the benefit of easy access, it provides the brand with visibility due to these retailers promoting the product through weekly store flyers. These two elements help to generate revenue and it is also a form of advertising. Coca-Cola also other formal methods of engagement such as joint value creation initiatives, customer care centers,

research and development teams, and surveys. Coca-Cola also uses informal methods as well such as social media platforms.

Formal methods used for employees, are training and development programs to help with employee advancement. Other methods used for engagement include engagement surveys, town hall meetings, employee communications, individual development plans, community and employee well-being projects, and senior executive business updates.

 Lastly, the objectives of the Shareholders are the organization's strategies to maximize wealth and company growth. The Coca-Cola Company has been able to meet these objectives throughout the years as it is currently selling its products in over 200 countries.

Research and Development – 9

Marketplace Research:

When it comes to market research Coca-Cola “CC” has had its fair share of failure. In the 1980’s CC did a research survey on 200,000 taste tests and created a new formula over the original flavor. The people who were surveyed liked the new coke flavor, but they were not aware the old one was to be cancelled. So the data CC received was inaccurate and this caused the “New Coke” to fail, because people still wanted the original formula. This is one major failure CC has had with market research. (PHD, 2013) This type of research was primary, because it was new research. Coca-Coal has the “One Brand” campaign; this campaign is pushing how CC offers a taste for everybody with Coke Life, Zero, Diet and light. Coca-Cola has a customer care survey and this is the qualitative type of survey. Qualitative data seems to be what CC tries to gather, this gives them a better understanding of the consumers wants and needs. (Business Case Studies)

Market Observation:

The market for beverages has been changing for quite sometime and Coca-Cola is aware of this. A great example of CC market observation was with Diet Coke and how men were not buying it. Research showed that men associated diet coke with women and were not buying it. This is why Coke Zero was released, Coke is trying to capture the male market with that drink (Huffington Post) The reason CC is still the current beverage leader, because they observe the market and see the trends.

Advertising

            The current advertising campaign for The Coca-Cola Company is their “One Brand” campaign. This campaign ties together Coca-Cola in all of its variant forms. The basis for the “One Brand” campaign is that Coca-Cola is one of life’s simple pleasures that make everyday life a little more special. The recommendation for a new advertising campaign will build off of this principle but expand it to include their lesser invested markets. The idea is to advertise the product family of the Coca-Cola Company, as a multigenerational product that has always been with the consumer even if they were unaware of it.

            To create a sense of nostalgia, the Coca-Cola Company will reintroduce their iconic Coca-Cola Polar Bear family to consumers. The Coca-Cola Polar Bear family will not only be seen drinking Coca-Cola but other beverages under the Coca-Cola umbrella. These beverages will include PowerAde, Simply Orange, and Glacueu Vitamin water. The family of Polar Bears will be shown in print ads, T.V. ads, and digital media videos enjoying life’s simple moments such as a soccer game played by polar bear cubs drinking PowerAde and a mother polar bear drinking a bottle of coke while her cub enjoys a small bottle of Simply Orange. The slogan for this noncoke Coca-Cola Company adds will be “a part of our family and yours”, such as PowerAde, by the Coca-Cola Company, a part of our family and yours.

Sales Promotions

            Sales promotions that will be utilized during this campaign are:

·         T.V. Commercials

·         Print adds

·         Social Media engagement

·         Interactive online engagement at the Coca-Cola Company official website that will allow consumers to personalize and purchase plush Coca-Cola Polar Bears

·         Instore sales that would  put advertised Coca-Cola Family products on sale at the same time as Coke

·         Instore promotions were if consumers purchase a certain amount of noncarbonated Coca-Cola products they get a free Coca-Cola carbonated soft drink six pack of the their choice.

·         Joint Business Plans to sell Coca-Cola Company beverages at Zoo’s which contain Polar Bear Exhibits, with these concession stands having immediate proximity to these exhibits

·         Seasonal instore promotions were if consumers purchase a certain amount of noncarbonated Coca-Cola products they get a free seasonal themed plush polar bear as well as Super Bowl weekend bear dressed in football Jersey of the team the bar is sold in.

Reference:

BBC. (n.d.). Who, What, Why: In which countries is Coca-Cola not sold? From BBC: http://www.bbc.com/news/magazine-19550067

Business Case Studies. (n.d.). A Coca-Cola Great Britain case study. From Business Case Studies: http://businesscasestudies.co.uk/coca-cola-great-britain/using-market-research-to-develop-a-product-range/market-research.html

Coca-Cola . (n.d.). Product Description. From Coca-colacompany.com: http://www.coca-colacompany.com/brands/product-description#Coca-Cola

Coca-Cola sales decline in key countries. (n.d.). From Capital Press: http://www.capitalpress.com/Business/20160420/coca-cola-sales-decline-in-key-countries

Coca-Cola. (n.d.). Who We Are. From Coca-Cola: http://www.coca-colacompany.com/careers/who-we-are-infographic

Franklin, M. (n.d.). Which Country Drinks the Most Coca-Cola? From The Daily Mail: http://www.thedailymeal.com/which-country-drinks-most-coca-cola

Huffington Post. (n.d.). Diet Coke vs. Coca-Cola Zero: What’s The Difference? From Huffington Post: http://www.huffingtonpost.com/2016/04/18/diet-coke-vs-coca-cola-zero_n_1199008.html

PHD, S. S. (2013). Coca-Cola Lost Millions Because of This Market Research Mistake. Retrieved 2017 from Qualtrics: https://www.qualtrics.com/blog/coca-cola-market-research/

Reuters . (n.d.). Coca-Cola. From Reuters: http://www.reuters.com/finance/stocks/companyProfile?symbol=KO

Stakeholder Engagement. (n.d.). From The Coca-Cola Company: https://hbr.org/2007/11/a-leaders-five-key-stakeholder

The Guardian. (n.d.). How Coca-Cola is fighting against a US public losing the taste for it. From The Guardian: https://www.theguardian.com/news/datablog/2015/feb/13/coca-cola-us-public-

losing-taste

World of Coca-Cola. (n.d.). history. From world of coca-cola: https://www.worldofcoca-cola.com/about-us/coca-cola-history/

    

Ibisworld. (n.d.). beverage Industry. Retrieved from Ibisworld: http://clients1.ibisworld.com.bakerezproxy.palnet.info/reports/us/industry/ataglance.aspx?entid=285

Taylor, K. (2016, January 02). The 4 biggest ways American beverage consumption will change in 2016. Retrieved April 17, 2017, from http://www.businessinsider.com/4-big-beverage-industry-trends-in-2016-2015-12