Discuss about the Strategic Brand Management for Coca-Cola Company.
Coca-Cola is popularly known as the Coke brand name, which is the generic trademark of the company (Chang 1995). In the year 1886 at Atlanta Georgia, Coca-Cola was invented by John Styth Pemberton, who was popular for creating a patent business of medicines (Fraser and Seitel 2010). In the year 1917, Perth accountant had the right to produce the coca cola in Australia. Until 21 years, in the year 1937, the Coca-Cola organization sent their team to Australia to establish the facility of production (Our people 2015). The rolled off the first bottle within the small building in the area of Dowling Street and Crescent in Sydney (Fraser and Seitel 2010).
There were around 3300 items supplied in around 200 countries that are offered in wide range of diet as well as various regular sparkling beverages like 100% fruit drinks, energy, fruit juices, tea, sports drink, coffees, soy and milk-based beverages (Fraser and Seitel 2010). Within the corporate brand of Coca-Cola, there are various traditional products, such as diet-cake, Coke, Sprite, and Fanta. All the items of Coca-Cola organization were distributed through the franchisees by different distribution in various parts of the world (Fraser and Seitel 2010). The brand Coke looks to be quite popular carbonated beverage between the various popular products. It is depicted by the trademark and logo of the company (Fraser and Seitel 2010).
In the present, Coca-Cola Australia along with the companies bottling partner, such as Coca-Cola Amatil provides around 240 items, which includes cheap and regular soft drinks along with sports drink, water, flavoured milk, and teas. It’s the most leading brand that covers up Diet Coke, Coca-Cola, Goulburn, Pump, Coca-Cola Zero, Sprite, Valley, Powerade and much more (Fraser and Seitel 2010).
Market Analysis
The size of a market
The market share of the traditional carbonated beverage companies all over the world depicts that soft drink market is highly dominated by coca cola in 2015, as the company had attained market share of around 48.6% (Kaye- Jennifer 2005). The international market calculated to have 341.6 billion dollars (Chang 1995). From the five famous soft drink brand in Australia, there are coca cola brands, such as Coca-Cola that is consumed by around 19% of the Australians that are within the age group of 14 and more; next is Coca-Cola Zero that is consumed by 8% of people and Diet Coke is consumed by around 5% of individuals (Kaye- Jennifer 2005). The other brands of Cola are Pepsi Max that is consumed by around 7% of the people.
Coca-Cola had gained benefit through the rapidly growing global beverage industry all over the world (Kaye- Jennifer 2005). The global beverage industry, excluding the US, is highly expected to get enhanced the value by around $300 billion from the year 2014 till 2020. Coca-Cola has around 30% of the market share in the international beverage industry. If the organization tries to maintain its global market share increased by 2020, it will include $90 billion in the market cap that relies on the expected enhanced in the global beverage value (Kaye- Jennifer 2005). Coca-Cola includes the market cap of around 150 billion in the starting of 2014. It provides the organization with the expected compound growth rate of around 6.9%, excluding the share repurchases and dividends by 2020, in case the company failed in gaining any market share (Kaye- Jennifer 2005). It is believed that Coca-Cola with the gain market share as well as reward shareholders with the dividends and repurchases. It will try to drive the growth rate of the company in the double digits for the coming many years (Kaye- Jennifer 2005). Coca-Cola had tried to position itself for gaining the benefits of non-alcoholic beverage all over the world. Below figure depicts that the company had strong competitive position all over the world (Kaye- Jennifer 2005).
Coca-Cola fails in targeting the particular segment, but tries to adopt the marketing strategy through developing new items (Lynch 1997). Similarly, it makes use of niche targeting and similar targeting strategies that could drive the sales within the competitive market (Kaye- Jennifer 2005). Its key product Coca is quite popular all over the world and is accepted by many people of every age group, where else diet cook often targets the niche segment for the people who are quite health conscious (Chang 1995). Coca-Cola make use of competitive positioning strategy to make the way ahead for the competitors in the market for non-alcoholic beverages (Kaye- Jennifer 2005).
Coca-Cola had around 500 brands along with around 3500 various types of product offerings. All this range of sodas to the energy drinks, to hot soy-based beverages in the Asian market (Kaye- Jennifer 2005).
The soft drink industry competition are getting tougher (Chang 1995). The key competitors during that period were Parle and Pepsi. Parle is the best and famous brand and covers up Thumps Up, Citra, Limca and various others, Maaza and Gold Spot. During that time, Parle had acquired a market share of around 53%, and Pepsi had covered the markets share of around 20% (Kaye- Jennifer 2005). Now Coca-Cola had also formulated various strategies to survive in the fierce ongoing competition (Chang 1995). In the case of that Coca Cola had decided to undertake the Parle, so that organization can take the benefits of including in Parle network (Kaye- Jennifer 2005). This type of decision is proved beneficial for the coke customers, as they were interested in accessing around 200000 retailer outlets along with around 60 bottles of Parle network (Kaye- Jennifer 2005).
Coke even provides the various range of items like Coca-Cola, Coca-Cola Cherry, Diet Coke Caffeine-Free, Coca-Cola Vanilla, Diet Coke, Caffeine Free Coca-Cola and a wide variety of lime and coffee (Das, Prakash and Khattri 2012). Competition rivalry existing in the industry competition of beverage could be categorized as Duopoly such as Coca-Cola and Pepsi. Competitor’s market share is considered as too little to encourage the price war (Das, Prakash and Khattri 2012). Coca-Cola attains competitive benefits by the new global trademarks through achieving the premium cost. It implies that Coca-Cola holds something that competitors failed to do so (Das, Prakash and Khattri 2012).
Brand’s target market- the advertisements of Coca-Cola mainly focus on the young generations and teenagers. As Coca-Cola aims the items to present the high energy people and youth (Das, Prakash and Khattri 2012). On the other side, Coke ads try to change the target market towards Coke for everyone and Coke for all, as it depicts that not only the youths are considered as targeted Coca-Cola group, but each and every person target them (Das, Prakash and Khattri 2012).
The below perceptual map depicts that there are around three names that describe the different personality attributes (Vartanian, Schwartz and Brownell 2007). Coca-Cola is highly related with the successful as well as down to earth kind of brand (Kim, Han and Park 2001). Pepsi is highly associated with the up to date, spirited as well as a charming personality; where else Thumps Up is linked with the honest and robust brand (Aaker 1997).
Coca Cola issues demand as the top brand all over the world, which is the successor within the soft drink industry in the last 100 years (Vartanian, Schwartz and Brownell 2007). Along with this success, they can incur crisis in this way (Kim, Han and Park 2001). In the year 2003, Coca-Cola was targeted by the activist group of engineers, environmentalist, scientist, and journalist related with a centre for science and environment to safeguard from unsafe items (Geuens, Weijters and Wulf 2008). Because these products include pesticide residues that could surpass the international standards (Kim, Han and Park 2001). Coca Cola items were also targeted by the press release that mentions 12 key cold drinks brand were sold near and around the city, which includes poisonous cocktail related to pesticide residues (Ruth and Simonin 2003). This test was done for the three samples, which includes Pepsi, and Coca-Cola brands, that includes 30-36 times the international standards of the residues (Kim, Han and Park 2001). The pesticides explored to cause the diseases like birth defects, cancer, as well as various immune system disruption along with various other health conditions (Kim, Han and Park 2001).
For different organizations, there are around three-dimensional branding that created perfect sense (Bhasin 2016). The physical space is mainly used for conducting the business, whether it’s a satellite office, store or either the world headquarters that look visible and costly to leave the equation of brand building (Kumar 2011). In reason to this, if the brand is considered as the message, space need to be viewed as the way of attaining across the sort like the dynamic billboard, huge or either the mainly ambitious product packaging extension (Vartanian, Schwartz and Brownell 2007). Coca-Cola is usually considered as the single solution through the connoisseurs of soft drink all over the world (Kumar 2011). That is why the successful branding discussion includes the actual thing, in which beverage is involved in the cultural phenomenon (Kumar 2011).
Pepsi and Coca-Cola are the two favourite brands of soft drink that occupy 95% of the cold drink market (Vartanian, Schwartz and Brownell 2007). With almost negligible, small as well as functional advantages of the cold drink, and there is no difference in colour, taste or two brand price, marketers need to have the cash in the self-expressive value of the items (Kumar 2011). Failure to have a practical point of difference, the emotional or self-expressionist value of brands is considered as difference focal point. Various other items such as Limca and Sprite is not selected due to differentiation that could assist by colours, and therefore, product personality is highly influenced by the variables (Kumar 2011).
It is recommended that Coca-Cola organization relies on the performing different models of valuation that includes, analysis of economic profit, Human Resource practices, original price and relative valuation towards earnings valuation model, which is revealed by the company of Coca-cola that is overvalued. Even though they explore the shock to be overvalued, and they think that KO had certain promising viewpoint along with expected issues in the coming time, and it is recommended that it should have hold instead of selling it.
The coca cola company is considered as at top in the market of non-alcoholic beverages industry. They had the experience of 20 years standing as the leaders as well as investors to understand why the coca cola has an extraordinary position for enhancing the value of shareholders. Opportunities which exist for the company in near future is increasing the market share within the segment of non-carbonated beverages, business model restructuring as well as better earning results consistency.
The issues that coca cola face is related to global competition as Human resource practices are increasing as compared to coke. If the coke thinks to have the reputation in the world market they should try to produce the incentives for the staff, through which they could easily do hard work and try to provide products of high quality. The team of new management should work towards implementing the cohesive goal existing among the two to meet the long-term growth potential of the company.
The company is highly committed to offering the inclusive environment for working in which each and every member is treated equitably. It is believed that people are coming from different backgrounds, having various life talents and experiences is considered as the actual business bonus. That is the reason why valuing and respecting the people diversity is always recommended to put them in central of the values and vision of the company. It’s also why the policies and practices of the employment are developed for protecting against ensuring equal opportunity and discrimination for all, regardless of sex, age as well as ethical background.
References
Aaker, J. L. 1997. Dimensions of Brand Personality. Journal of Marketing Research, 12, pp. 1-12.
Bhasin, H. 2016. Marketing strategy of Coca cola – Coca cola marketing strategy. [Online]. Available at: https://www.marketing91.com/marketing-strategy-of-coca-cola/ [Accessed on: 12th August 2016].
Chang, T.L. 1995. “Formulating adaptation marketing strategies in a global industry”. International Marketing Review, 2, pp. 1-12.
Das, J., Prakash, O., and Khattri, V. 2012. Brand Personality Mapping: A Study on Colas. Asian Journal of Management Research, 2, pp. 1-23.
Fraser P., and Seitel. 2010. The Practice of Public Relations, 11th Edition. New Jersey: Pearson Prentice Hall, UpperSaddle River
Geuens, M., Weijters, B., and Wulf, K. D. 2008. A New Measure of Brand Personality. Belgium. Sage.
Kaye- Jennifer. 2005. Tuck School of Business, Dartmouth College, Coca Cola India. Journal CaseStudy Competition in Corporate Communications, 1, pp. 1-4.
Kim, C. K., Han, D., and Park, S.-B. 2001. The Effect of Brand Personality and Brand Identification on Brand Loyalty: Applying the Theory of Social Identification. Japanese Psychological Research, 3, pp. 195-206.
Kumar, R. S. 2011. Consumer Behaviour and Branding. Dorling Kindersley (India) Pvt. Ltd.
Lynch, R. 1997. Corporate strategy. Great Britain: Pitman Publishing
Our people. 2015. [Online]. Available at: https://www.coca-cola.co.uk/about-us/our-people [Accessed on: 12th August 2016].
Ruth, J.A. and Simonin, B.L. 2003. Brought to you by brand A and brand B. Journal of Advertising, 23, pp. 1-12.
Vartanian, L. R., Schwartz, M. B., and Brownell, K. D. 2007. Effects of Soft Drink Consumption on Nutrition and Health: A Systematic Review and Meta-Analysis. American Journal of Public Health, 23, pp. 1-34.
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