A carbonated soft drink was invented in 1886 name Coca-Cola, has become an iconic image
of soda which famous for a unique and pleasurable taste. This product sold for more than 200
countries worldwide and always the best-selling non-alcoholic beverage for many years.
Beside from Coca-Cola, variety of brand name are popular soft drink such as Sprite, Fanta,
Pepsi and [Link]. However, there is only one with quite a similarity in taste, ingredients
compare to Coca-Cola and quickly become vibrate to more than 200 nations, second place in
non-alcoholic beverage market share, Pepsi becomes the most dangerous competitor for
Coca-Cola.
Competition in between product, in other words, their company try to be more successful
than others, by selling, produce same products and present to the same group of customers,
competitors will compete in sales, profit, market share, goods and services, quality and price.
Competition helps competitors move forward, improve brand name, innovation, be creative,
know how to satisfy customers and increasing value for the company, without competition,
company remaining in place (Murcko, n.d). Competition brings benefit for both company and
consumers; consumers evaluate product and base on consumers preferences, the company
make better decisions, performances, and strategy. Especially in marketing mix: When Pepsi
become popular, Coca-Cola decided to sell in different packaging and size: 200ml, 500ml,
1ltr, 1.5ltt and 2ltr bottles in cans, glass and plastic bottles, its convenience when consumers
have more options to choose. Coca-Cola also has many kinds of flavors (e.g. Lime Coke,
Cherry Coke), diversities in type of beverage (e.g. Coke Zero, Diet Coke) based on their
preferences and it has been known for "Addicted flavor but uplifting refreshment”. In the
beverage market, it considered being a market where there are a few sellers offer similar
products but slightly different and many buyers, known as an oligopoly market (p.52 of
textbook). Pepsi is one of the biggest competitor in price. Aiming for customers loyalty,
Coca-Cola prices its products cannot too high nor too low, it could impact consumers are
price-sensitive, or it might leave an impression of low quality, this is why Cola company has
to be careful in control cost. Due to high competitors, promotion plays an essential role in
Coca-Cola marketing campaigns in order to increase sales and loyal consumers. Company
focus on advertising campaigns using media, social media and outdoor ad campaigns to
engage with costumers, remind customers with joyful and happy feeling when have a drink
with Coca-Cola (e.g."Taste the Feeling", campaign in India, 2016), connect they emotional
together and make them feel youth, Coca-Cola launched their "Shake a Coke" in Australia
2012 and Britain 2013, a huge success campaign of custom Coca bottle by putting customers'
names in, which bring a considerable profit for company. In addition, Coca-Cola has high
brand equity, customers can identify easily, with the audience's recognition, Coca could be
imitated Pepsi.
Base on SWOT analysis (p.66 of textbook), Coca-Cola is a valuable brand name, which is
recognized for the most-selling drinks in the world with red and white logo. Coca is
associated with "happiness" and "refreshment", company has gained strong customers
loyalty. Moreover, Cola is a big competitor in market share, dominated in the beverage
segment, obtaining the largest market share in non-alcoholic beverage area and having strong
distribution network which allows bottling partners reach customers faster than its rivals
could reach. Having a wide audience help Coca-Cola in raising brand awareness and
company's valuation (in 2019, company values around 73 billion dollars, including product
and packaging innovations, manufacture, campaigns and profit of Coca). On the other hand,
the company has been misleading in innovate product. For instance, Coca promised to reduce
sugar to protect consumer's health when tax on sugary drinks has been legislated, Colas in
Australia claimed "reducing sugar in 22 of our drinks since 2015" and committing to "make
all our new Coca-Cola flavors either reduced or no sugar". Although Coca-Cola did reduce
sugar in drinks, they substituted sugar with stevia. It is sweet come from a plant and was
considered as "nature", but the sugar content they put in drinks exceeds the limit for a person
(World Healthy Organisation 2016). People have concerned with obesity and diabetes for a
long time ago. Carbonated beverage is one of major reason leads to overweighting, especially
Coca-Cola, yet they have not found an alternative healthier solution. To boost Coca-Cola
further and avoid a decrease in sales, the opportunity for the company is they should reach
more countries, expand the distribution channel to extend consumers. Coca-Cola threats right
now are sugar content related to health issues, indirect competitors such as Starbucks, if we
compare caffeine versus sugar, people may look for healthy option. And groundwater
resource, Coca-Cola uses water in their product but water supplied become scarce because of
climate change, if they keep developing soft drink, water will be exhausted in the future. This
factor can impact both Coca-Cola and Pepsi business; however, PepsiCo have other markets
to develop (e.g., Lays, Doritos, Cheetos) unlike Colas, Coca-Cola's revenue can fall if they do
not do next move quickly.
In PESTEL analysis (p.55 of textbook), environment factor is how the environment
influences product, unfortunately, Coca-Cola used to have environment issue. In India, they
have deep concern about recycling, nature resource, pollution. By following environmental
laws as company manufactures their products, using recycling plastic in packaging, planting
more trees to save water and using recycle plants to recycle water. This makes Colas
company still remain in India after the crisis (Forced to shut down bottling facilities in 2004
due to polluted groundwater). In economic factor, understanding short term and long term are
essential, consider interest rate, fluctuation rates, currency exchange rate and economic
growth of the nation, inflation rate, employment and unemployment rate, wage rate, the
standard of living for future investment of company. In this case, with high brand equity,
Coca-Cola can influence power of purchase of a country. This brand has affected exchange
rate and currency rate by the company's export but can cause inflation, at that time of
inflation, product cost will need to be adjusted to compete with another brand. Social factor,
it means company has to be specific in analysing culture and lifestyle of their target country.
Despite the fact that Coca-Cola great job meets the demand in flavor for customers such as
China and Japan, drink consumption in the USA is declining, the reason is people and
government are concern more about obesity, health problem. Americans customers need a
response from their needs.
Reference:
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