The Mission Statement of the Coca-Cola Company
Our mission statement is to maximize share owner value over time.
In order to achieve this mission, we must create value for all the constraints we serve, including our consumers, our customers, our bottlers, and our communities. The Coca-Cola Company creates value by executing comprehensive business strategy guided by six key beliefs:
1. Consumer demand drives everything we do.
2. Brand Coca-Cola is the core of our business
3. We will serve consumers a broad selection of the nonalcoholic ready-to-drink beverages they want to drink through out the day.
4. We will be the best marketers in the world.
5. We will think and act locally.
6. We will lead as a model corporate citizen.
The ultimate objectives of tour business strategy are to increase volume, expand our share of worldwide nonalcoholic ready to drink beverages sales, maximize our long-term cash flows, and create economic value added by improving economic profit.
The Coca-Cola system has more than 16 million customers around the world that sells or serves our products directly to consumers. We keenly focus on enhancing value for these customers and helping them grow their beverage businesses. We strive to understand each customer’s business and needs, whether that customer is a sophisticate retailer in a developed market a kiosk owner in an emerging market.
Nearly 6 million people in the world are potential consumers of our company’s products. Ultimately, our success in achieving our mission depends on our ability to satisfy more of their beverage consumption demands and our ability to add value for customers. We achieve this when we place the right products in the right markets at the right time.
Coca-Cola International
History
Coca-Cola Enterprises, established in 1986, is a young company by the standards of the Coca-Cola system. Yet each of its franchises has a strong heritage in the traditions of Coca-Cola that is the foundation for this Company.
The Coca-Cola Company traces it’s beginning to 1886, when an Atlanta pharmacist, Dr. Hohn Pemberton, began to produce Coca-Cola syrup for sale in fountain drinks. However, the bottling business began in 1899 when two Chattanooga businesspersons, Benjamin F. Thomas and Joseph B. Whitehead, secured the exclusive rights to bottle and sell Coca-Cola for most of the United States from the Coca-Cola Company.
The Coca-Cola bottling system Continued to operate as independent, local businesses until the early 198s when bottling franchises began to consolidate. In 1986, the Coca-Cola Company merged some of its company-owned operations with two large ownership groups that were for sale, the John Lupton franchises and BCI Holding Corporation’s bottling holdings. to form Coca-Cola Enterprise Inc. The Company offered its stock to the public on November 21, 1986, at a split-adjusted price of $5.50 a share. On an annual basis, total unit case sales were 880,000 in 1986.
In December 1991, a merger between Coca-Cola Enterprises and the Johnston Coca-Cola Bottling Group Inc. (Johnston) created a larger, stronger Company, again helping accelerate bottler consolidation. As part of the merger, the senior management team of Johnston assumed responsibility for managing the company, and began a dramatic, successful restructuring in 1992. Unit case sales had climbed to 1.4 billion, and total revenues were $5 billion.
Management:
The hierarchy of Coca-Cola Company is as follows:
Market Share:
Being the biggest company in the soft drink industry, Coca-Cola enjoys the largest market share. This Company controls about 59% of the world market.
Global Market share
The following table can show the worldwide operation segments.
(Table)
| Unit case growth | Non-alcoholic drink | All commercial Beverages | ||||||
| 10 year compound annual growth | 5-year compound annual growth | 2007 annual growth | 2008 | 2008 | ||||
| Company | Industry | Company | Industry | Company | Industry | Company Share | Company Share | Company Share per capita Income |
| 6% | 5% | 5% | 5% | 4% | 4% | 18% | 9% | 70 |
This shows that the market of the company is geographically vast and it is controlling it with great success. In 2008, the company grew their carbonated soft-drink business by nearly 250 million unit cases and generated record volumes. Because carbonated soft drinks are the largest growth segment within the nonalcoholic ready-to-drink beverage category measured by volume, that is why they are focusing more on this and they are continually increasing the pace because they know that accelerating this pace is crucial to their future success. Thus, they are increasing their market day by day. The operation income earned by Coca-Cola Company can be illustrated by the following pie chart.
(Figure)
Operating Income
North America
Operations Income 24%
International
Operations 76%
This strategy has worked a lot and it has helped them to become the world’s leading soft drink company. The global unit sale of the Coca-Cola Company in increasing from the last ten years. The data of the global unit sale of the Coca-Cola Company can be represented by following chart.
Unit sale in billions
So there is positive growth in the market of the Coca-Cola Company. There is a worldwide volume increase by 4% with strong international growth of 5%. This is only due to the innovative marketing programmers, which has deepened the relationship of the customers and Coca-Cola. The financial health and success of their bottling partners is a critical component of the Coca-Cola Company’s ability to build and deliver leading brands.
In 2008, the company had worked with their bottlers to turn good intentions into reality by improving the system economics. The results in 2008 reflect this steadily improving and mutually constructive relationship between the Company and their bottling partners. The main reason behind this relationship is to continue realizing shared opportunities for growth, with closer coordination of operations including customer relationships, logistics and production.
Market share by area:
Coca-Cola is the world-renowned soft drink and the company is currently operation through out the world. The worldwide total is about 17.8 billion. The operation review according to the segments is as follows.
Operation Review
(2008 worldwide unit case volume by operation segment)
| North America | Latin America | Europe & Middle East | Asia | Africa | |
| 30% | 25% | 22% | 17% | 6% | |
So the volume is least in the Africa and most in the North America. The data about the market share of this company area wise is given in the following table.
The above table shows the geographical earning of the Coca-Cola Company and from this data; we can find out that the customers of Coca-Cola are increasing which is shown by the company’s per capita income. Unit case equals 24 eight-ounce servings. The column, which shows the non-alcoholic beverages consist of commercially, sold beverage, as estimated by the Company based on available industry sources. The country column is derived from the company’s unit case volume while the industry column includes nonalcoholic ready-to-drink beverages only, as estimated by the Company based on available industry sources.
(Table)
| Country | Unit case growth | Non-alcoholic Drinks | All commercial Beverages | ||||||
| 10 year compound annual growth | 5 year compound annual growth | 2008 annual growth | 2008 | 2008 | |||||
| Company | Industry | Company | Industry | Company | Industry | Company Share | Company Share | Company per capita income | |
| North America | 4 | 5 | 3 | 3 | 2 | 2 | 22 | 15 | 398 |
| United States | 4 | 5 | 3 | 3 | 2 | 2 | 23 | 16 | 419 |
| Latin America | 6 | 7 | 6 | 6 | 3 | 4 | 24 | 15 | 205 |
| Argentina | 7 | 4 | 6 | 2 | 7 | 2 | 2 | 10 | 236 |
| Brazil | 5 | 5 | 3 | 6 | 3 | 5 | 23 | 13 | 144 |
| Chile | 9 | 6 | 5 | 3 | 2 | 3 | 56 | 23 | 336 |
| Mexico | 7 | 10 | 8 | 9 | 2 | 5 | 22 | 18 | 462 |
| Europe & Middle East | 6 | 3 | 5 | 3 | 2 | 4 | 12 | 6 | 72 |
| Eurasia | 17 | 8 | 6 | 5 | (14) | 1 | 14 | 5 | 39 |
| France | 8 | 3 | 9 | 3 | 7 | 3 | 9 | 5 | 110 |
| Germany | 1 | 2 | (1) | 1 | (6) | 1 | 14 | 7 | 193 |
| Great Britain | 8 | 2 | 11 | 2 | 8 | 3 | 14 | 6 | 193 |
| Italy | 1 | 3 | 4 | 3 | 2 | 2 | 9 | 6 | 104 |
| Middle East | 12 | 12 | 7 | 5 | 4 | 8 | 8 | 3 | 17 |
| Spain | 6 | 4 | 8 | 5 | 4 | 4 | 17 | 12 | 264 |
| Asia | 7 | 6 | 6 | 7 | 10 | 7 | 14 | 5 | 23 |
| Africa | 7 | 6 | 8 | 3 | 10 | 6 | 34 | 11 | 34 |
In Asian population, which is the satisfied customer of Coca-Cola, is approximately 3.2 billion and the average consumer enjoys close to two servings of our products each month. Though an intense focus on Coca-Cola, innovation and new beverages, the company has achieved volume growth of 10 percent in 2008. With developing economies and populations, this region ahs strong long-term potential, and the company is building and exciting family of beverage brands in addition to expanding the popularity of our core brands, led by Coca-Cola. In China, for example, sales of Coca-Cola increased 6%. The total unit case sale of Coca-Cola in Asia can be shown by the following pie chart.
(Figure)
So the company is emphasizing more in this area and is trying to develop a strategy, which can increase the growth of the consumption of Coca-Cola by the people of Asia. Among the countries of Asia, Japan has the highest percentage, which is about 29%. among others, Pakistan, India and Bangladesh are those countries where the average consumption is increasing day by day.
Financial Report:
This company is financially very strong. It is due to the strong finances, the company is still surviving the ups and down of the business world. The financial report of Coca-Cola Company of the year 2007 and 2000 along with the percentage change is as follows.
(Table)
Year Ended December 31,
(In millions except per share date, ratios and growth rates)
| 2008 | 2007 | Percentage change | |
| Net operating revenues | 20,092 | 19889 | 1% |
| Operation income | 5352 | 3691 | 45% |
| Net income | 3969 | 2177 | 82% |
| Net income per share (basic) | 1.60 | 0.882 | 82% |
| Net income per share (diluted) | 1.60 | 0.882 | 82% |
| Net cash provided by operating activities | 4110 | 3585 | 15% |
| Business reinvestment | (963) | (779) | 24% |
| Dividends paid | (1791) | (1685) | 6% |
| Share repurchase activity | (277) | (133) | 108% |
| Free cash flow | 3147 | 2806 | 12% |
| Return on capital | 26.6% | 26.2% | – |
| Return on common equity | 38.5% | 23.1% | – |
| Unit case sales (in billions) | |||
| International operations | 12.5 | 11.9 | 5% |
| North America operations | 5.3 | 5.2 | 2% |
| Worldwide | 17.8 | 17.1 | 4% |
2008 basic and diluted net income per share includes a non-cash gain of $ 0.02 per share after taxes, which was recognized on the issuance of stock by Coca-Cola Enterprises Inc., one of the equity investors of this company.
2008 basic and diluted net income per share includes the following charges:
· $0.24 per share after income taxes related to an organizational Realignment.
· $0.19 per share after income taxes related to the company’s portion of charges recorded by the investors of the company.
· $0.16 per share after income taxes related to the impairment of certain bottling, manufacturing and intangible assets.
· $0.05 per share after income taxes related to the settlement terms of a discrimination lawsuit.
· $0.01 per share after income taxes related to incremental marketing expenses in Central Europe.
These charges are partially offset by a gain of $ 0.05 per share after income taxes related to the merger of Coca-Cola Beverages plc and Hellenic Bottling Company S.A and $0.04 per share after income taxes related to benefits from a tax rate reduction in Germany and from favorable tax planning strategies.
Dividend and cash investment plan
The Dividend and cash investment plan permits shareowners of record to reinvest dividends from Company stock in shares of the Coca-Cola Company. The plan provides a convenient, economical and systematic method of acquiring additional shares of our common stock. All shareowners of record are eligible to participate; shareowners also may purchase Company stock through voluntary cash investments of up to $125,000 per year. At year-end, 76 percent of the company’s shareowners of record were participants in the plan. In 2008, shareowners invested $36 million in dividends and $31 million in cash in the plan.
EBITDA is the Earning before interest, taxes, depreciation, amortization, and other non-operating items.
· Net Debt is the Long-term debt plus current portion of long-term debt less cash and marketable securities.
· Equivalent Case or Unit case is the physical case and fountain gallons converted to a standard unit of measure defined as 24 eight-ounce serving or 192 ounces per equivalent case sold by Coca-Cola Enterprise.
Products:
There are different brands of the Coca-Cola Company, which are currently in use through out the world. This company not only deals in the carbonated drinks but also other drinks. While launching its product, the marketing team considers the culture of the country.
Major brands of Coca-Cola
· Coke
· Sprite
· Fanta
· Diet Coke
· Coke Classic
| Name | Launched | Discontinued | Notes | Picture |
| Coca-Cola | 1886 | |||
| Caffeine-Free Coca-Cola | 1983 | |||
| Coca-Cola Cherry | 1985 | Was available in Canada starting in 1996. Called “Cherry Coca-Cola (Cherry Coke)” in North America until 2006. Zero-calorie variant (Coca-Cola Cherry Zero) also currently available. | ||
| New Coke/”Coca-Cola II” | 1985 | 2002 | Still available in Yap and American Samoa | |
| Coca-Cola with Lemon | 2001 | 2005 | Still available in:American Samoa, Austria, Belgium, Brazil, China, Denmark, Federation of Bosnia and Herzegovina, Finland, France, Germany, Hong Kong, Iceland, Korea, Luxembourg, Macau, Malaysia, Mongolia, Netherlands, Norway, Réunion, Singapore, South Africa, Spain, Switzerland, Taiwan, Tunisia, United Kingdom, United States, and West Bank–Gaza | |
| Coca-Cola Vanilla | 2002 | 2005 | Still available in:Austria, Australia, China, Germany, Hong Kong, South Africa, New Zealand (600ml only) Malaysia, Sweden (Imported) and Russia. Was called “Vanilla Coca-Cola (Vanilla Coke)” during initial U.S. availability. | |
| 2007 | It was reintroduced in June 2007 by popular demand | |||
| Coca-Cola C2 | 2003 | 2007 | Was only available in Japan, Canada, and the United States. | |
| Coca-Cola with Lime | 2005 | Still available in Belgium, Netherlands, Singapore, and Canada | ||
| Coca-Cola Raspberry | June 2005 | End of 2005 | Was only available in New Zealand. | |
| Coca-Cola Zero | 2005 | |||
| Coca-Cola M5 | 2005 | Only available in Federation of Bosnia and Herzegovina, Germany, Italy, Spain, Mexico and Brazil | ||
| Coca-Cola Black Cherry Vanilla | 2006 | Middle of 2007 | Was replaced by Vanilla Coke in June 2007 | |
| Coca-Cola Bl?k | 2006 | Beginning of 2008 | Only available in the United States, France, Canada, Czech Republic, Slovak Republic, Federation of Bosnia and Herzegovina, Bulgaria and Lithuania | |
| Coca-Cola Citra | 2006 | Only available in Federation of Bosnia and Herzegovina, New Zealand and Japan. | ||
| Coca-Cola Light Sango | 2006 | Only available in France and Belgium. | ||
| Coca-Cola Orange | 2007 | Only available in the United Kingdom and Gibraltar | ||
| Coca-Cola Classic | 2008 | Introduced in bottle form after Coke Classic in cans was made. Available in United States. |
Know the most recognized word on
the planet after “OK”!
Among the soft drinks Fanta and Sprite becomes successful along with the major brand Coca-Cola and Diet Coke. In key markets, the company has created new packaging sizes to satisfy consumer demands.
Increasingly, Mexican families have lunch together at home. The average Mexican household drinks two-and-a-half liters or more of soft drinks that break, while a two-liter bottle was the largest available package. So the company introduced a convenient 2-1/2 liter bottle to select regions, contributing to the sale of nearly 1.5 billion unit cases of Coca-Cola in Mexico this year. This larger bottle will complete its nationwide rollout in 2008. In China, Coca-Cola is an integral part of holiday celebrations and the family get-togethers that accompany such events. Through an intense focus on Coca-Cola, innovation and new beverages, it has achieved volume growth of 10% in 2007. In China, sales of Coca-Cola increased by 6%. In the United States, recognizing that consumers often enjoy their diet Coke with a slice of lemon, the company “bottled” the concept. The result, diet Coke with lemon, contributed to volume growth of 4% for the number-on diet.
Soft drink in North America: diet Coke. The company increased its two largest bottle sizes during the 2007 holidays, and festival packaging helped driven a 6% volume increase for Coca-Cola. The packaging innovation does not just involve resizing. The company has also responded to consumers’ changing fashion styles with new bottles.
With brands such as Minute Maid, Hi-C, Simply Orange and Disney juices and juice products, packaging, positioning and marketing. The results speak for themselves; it’s global sports drinks, led by PowerAde and Aquarius, grew by 13% in 2008, nearly double the growth rate of the worldwide sports-drink category. Revitalized in the United States, the company introduced PowerAde in nearly every major Western European market, including Great Britain, Germany and Spain, as well as in Mexico and Latin America. The company launched 27 products in 2007.
The commitment of the company to packaging innovation also resulted in new initiatives for our fountain business a channel through which consumers may enjoy Coca-Cola. In the United States, the company developed Fountain, a total beverage dispensing system that is more flexible and more reliable. Two years of research resulted in a dispensing system that provides exceptional beverage quality, easy to upgrade technology, brand and graphic customization and improved reliability.
Strategic Planning
In the year 2008, the company had a great success, as the strategy worked which resulted in making Coca-Cola Company the world’s leading company. In 2007, company accomplished the crust of it’s strategy as
· Worldwide volume increased by 4% with strong international growth of 5% and clear signs that our North American business is growing solidly and predictable.
· Earnings per share grew by 82% , as we delivered on our commitment to create volume growth while aggressively.
· Return on common equity grew from 23% in 2000 to 38% this year.
· Return on capital increased from 16% in 2000 to 27% in 2007.
· The company has generated free cash flow of $3.1 billion, up from $ 2.8 billion in 2000, a clear indication of its underlying financial strength.
The strategy for the future of the company is very straightforward. The marketing strategy for the year 2008 is as follows,
· Accelerate carbonated soft-drink growth, led by Coca-Cola.
· Selectively broaden the family of beverage brands to drive profitable growth.
· Grow system profitability and capability together with our bottling partners.
· Serve customers with creativity and consistency to generate growth across all channels.
· Direct investments to highest potential areas across markets.
· Drive efficiency and cost effectiveness everywhere.
Major Competitor
Pepsi International
History
PepsiCo is a world leader in convenient foods and beverages, with revenues of about $27 billion and over 143,000 employees. The company consists of the snack businesses of Frito-Lay North America and Frito-Lay International; the beverage businesses of Pepsi-Cola North America, Gatorade/Tropicana North America and PepsiCo Beverage International; and Quaker Foods North America, manufacturer and marketer of ready-to-eat cereals and other food products. PepsiCo brands are available in nearly 200 countries and territories.
Many of PepsiCo’s brand names are over 100-years-old, but the corporation is relatively young. PepsiCo was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay. Tropicana was acquired in 1998 and PepsiCo merged with the Quaker Oats Company, including Gatorade, in 2007. World entertain the listener with the latest musical selections rendered by violin or piano or both. The new name, “Pepsi Cola”, is derived from the two of the principle ingredients, Pepsin and Kola Nuts. It was first used on the August 28. At that time, Bradham’s advertising praises his drink as “Exhilarating, invigorating, aids digestion”.
1990-2008
The advertisement of the Pepsi changes to, “You got the right one baby, Uh-Huh!. With the extensive usage of the stars in the ads, the popularity of Pepsi increase. In 1992 Pepsi-Cola formed a partnership with Thomas J. Lipton Co. Today Lipton is the biggest selling ready-to-drink tea brand in the United States. Outside the United States, Pepsi-Cola Company’s soft drink, operations include the business of Seven-Up International. Pepsi-Cola beverages are available in more than 190 countries and territories. In Asia, they selected Lahore to make their regional office. This was done in 1970. This regional office is monitoring all the operations carried out in South West Asia.
Pepsi is one of the oldest brands in Bangladesh. Pepsi first arrived in Dhaka in 1976 with the cola-flavored Pepsi, the clear-flavored 7up, the orange-flavored Mirinda and later introduced the mango-flavored Slice.
Pepsi’s Products
· Pepsi
· Teem
· Mirinda
· Pepsi Max
· Pepsi Lemon
· 7up
· 7up Ice
· 7up Lemon
· Mountain Dew
· Pepsi Blue
Coca-Cola Bangladesh
The Coca-Cola Company began operating in Bangladesh in 1974; Coca-Cola, Fanta and Sprite are the brands in Bangladesh. The Coca-Cola system in Bangladesh operated through eight bottlers, four of which are majority-owned by Coca-Cola Beverage Bangladesh Limited (CCBBL). The number one soft drink producer in Bangladesh, as well as all over the world. Closing in on Coke is rival Pepsi. Abdul Monem Limited (Coca-Cola, Sprite, Fanta)
35 Years of refreshment in Bangladesh
Ä Coca-Cola,
Ä Fanta,
Ä Sprite,
Ä Diet Coke
Ä Fanta Lemon
Promise of Coke
The basic proposition of our business is simple, solid and timeless. When we bring refreshment, value, joy and fun to our stakeholders, then we successfully nurture and protect our brands, particularly Coca-Cola. That is the key to fulfilling our ultimate obligation to provide consistently attractive returns to the owners of our business.
Target Market
Coke’s commercials basically based on young generations. So, the young generation is the target market of Coke because they want to represent Coke with the youth and energy but they also consider about the old people they take then as a co-target market.
Major Segments
Major Segments are basically those people who take this drink daily and those areas where the demands is higher then the others areas. There are so many people who take this drink daily and those people who take weekly and those who take less often are always there as well. Therefore, their basic segments are those people who take this drink regularly.
Factors effecting sales
There are so many factors, which affects the sale of coke. Here we are discussing three major factors, which effects coke.
· Per capita income
· Competitors
· Weather
Per Capita Income
First we will discuss about “per capita income”. This is major factor that affects the sale of this soft drink. Because which every passing year budgets are becoming very strict and tight in order to purchase things. So the disposable incomes of the people are coming down. They spend heavily on rents, utilities and education and basic necessities and after that when they get extra money they think about this soft drink So the decreasing per capita income effects badly in selling and production of this soft drink.
And to get through with this difficulty there is need to increase the level of per capita income of Bangladesh because it is much lesser than the rest of the countries.
Weather
Weather is the third major factor in effecting the Coke’s selling. This is underdeveloped market so the coke’s consumption is summers is 60% and in winters is 40%.
Major Customers Need
First of all the majority don’t care that what they are going to have. In other words, they don’t care before drinking that whether it is “Pepsi” or “Coke”. They don’t actually differentiate between these two brands in order to their tastes.
Consumers basically drink what they get.
They believe on “What cold they sold”
Consumer’s availability in brands is basically works like;
Push availability
Pull consumer’s demand.
For this reason Coca-Cola have provided their coolers and freezers in the market. They have maximum number of coolers and freezers in the market. They provide this infrastructure free of cost just to provide child coke to their customer, which they want to be purchase.
Their salesman and mechanics regularly visit all the shops where coke has its infrastructure to check that either it is in proper condition or not, if not then they immediately change or repair it.
Major Competitors
Consumers firstly decide that they are going to have a soft drink. Then they compete brands with each other. Like they complete Coke with Pepsi and sprite with 7up and team. So the major competitor of Coke is Pepsi.
When they motivate to any other brand or on Coke it’s in instinct basically that based on messages derive certain feelings.
But Coca-Cola thinks in a different way, they believe that RC Cola, new coming Mojo, and all juices, even they take water and tea as their competitors.
Strategies of Quality
After micro and macro analysis, Brand “Coke” is primarily role.
1. Enhance competition moments
2. When people watch cricket
3. Though commercialization
4. Fun time.
Through these strategies there could be better understanding and better connection with the public. These are the “Key consumption”.
Threats from Competitors
Threats are well planned. Price is the major threat. When price goes certain beyond the exact price whether come down or go higher its effects the consumption of soft drink. Because when the price go higher people go for the substitute of “Coke” i.e. Pepsi. And when price goes down they think that there is must be some thing wrong in it. In short it all depends on customer’s perception.
Targets that would like to attain
Every organization runs on the bases of profit maximization so Coke is also looking for high profit margin.
There are three major ways of making money
· Over night profit
· Windfall profit
· Ethical and un-ethical ways.
Over Night Profits
They could be over night profit that is for the number 1 brand for the year. This could be got my increasing sales volume.
Windfall profit
Can be windfall profit. They are the extras profit. When the consumption the consumption is on boom. So, there is different kind of profits.
Ethical and unethical ways
Profit can also get through ethical and unethical ways. They believe on this quote “Every thing is fare in love and war”.
Some profits stays for some time like “over night profits” and some just come and go like “wind fall profits”. And they can also get profit through different approaches.
Expanding Target Market
In last 2 years, Coke has come back in aggressive manner.
· Consumer has choice
· Attractive brand name
· Brand differentiating
Consumer Has Got Choice
Now the consumer has got choice. Because now they know the name of another big brand, though coke is the 2nd best name but it can get a better position after some time.
Attractive Brand Name
Now the consumers know the name of Coke, because Coke is the name, which is the most popular after the word “ok”. So people can better differentiate brands with each other.
Brand Differentiation
Now different companies have different brand names. So, people can distinguish between brands. Two major brands “Coke” and “Pepsi” also have brand names.
Coca-Cola’s Brand
Coca-Cola is “US” brand. Because they believe in the togetherness, being people together and friends are being together. Coca-Cola strongly believes that Bangladesh temperament is “US” not “ME”
Pepsi’s Brand
Pepsi’s brand is basically “ME” branded. They use the temperament of “ME”. IN contrast to Coke they believe on individual struggle.
Threats and opportunities for Price
Opportunities
If Coke is considered a luxury product. Then there is the tax rate system
15% – sales tax
20% – excise duty
30% – goes to government
03% – In making Budget
After paying all these taxes coke has to pay electricity charges. We have to spend on distributions. After paying all these expenses, Coke’s margin squeezed and consumers have to pay for increasing tariffs.
These are the opportunities through which we can increase the price and can get profits.
Threats
There are much more threats in increasing prices. Because same problem of substitute. If Coke increases the price, let’s say 1tk. Then people definitely won’t go for coke. They have the best substitute of Coke that is Pepsi. So, these are the threats in increasing prices. Coke will lose the margin of its profit and can face loss.
Strategies for getting goals i.e. High Profits
To increase the price is the least thing, which Coke can adopt. There are so many ways through which Coke can increase the profits. Some major ways are as follows.
· Volume can be increased
· Interest level of consumers
· To take part in energetic festivals
How to increase the volume of consumers?
Coke can increase the volume by expanding the industry of coke. Through advertisements. offering different interesting things to attract people towards this product.
How to increase the interest level of consumers?
Coke is increasing the interest level of consumers by offering different flavors. For example, Coke is increasing the number of flavors in “Fanta”, this is one of the product of coke. Through offering different flavor Coke can increase the level of consumers and through this profits can be gained.
How to take part in energetic festivals?
Coke is already taking part in the festival like “Basant” since last 3 years. Coke offers different attractive things in their festival and through this coke gained high profit and consumption of coke increased on these occasions.
In this year 2008 People were anxiously waiting that what interesting thing coke is going to offer.
Marketing Strategy
Our local marketing strategy enables Coke ot listen to all the voices around the world asking for beverages that span the entire spectrum of tastes and occasions. What people want in a beverage is a reflection of who they are, where they live, how they work and play, and how they relax and recharge. Whether you’re a student in the University enjoying a refreshing Coca-Cola, a woman in Italy taking a tea break, a child in Peru asking for a juice drink, or a couple in Korea buying bottled water after a run together, we’re there for you. We are determined not only to make great drinks, but also to contribute to communities around the world through our commitments to education, health wellness, and diversity. Coke strives to be a good neighbor, consistently shaping our business decisions to improve the quality of friends around the world, and we never forget it.
Market Positioning
Product Range
The total range of Coca-Cola Company in Bangladesh includes:
· Coke
· Sprite
· Fanta
· Diet Coke
And Company offers their products in different bottle sizes these includes:
· SSRB (Standers size returnable bottle)
· LRB (Litter returnable bottle)
· NRB (No return bottle) or disposable bottle
· PET 1.5 (1.5 litter plastic bottle)
· CANS (tin pack 330 ml)
Packing
Coca-Cola products are available in different packing
· 24 regular bottle shell
· 6 bottle pack for 1.5 pets
· 12 bottle in a pack for disposable bottle
· 24 cans in one pack.
Price Strategy
Trade Promotion
Coca-Cola Company gives incentives to middle men or retailers in way that they offer them free samples and free empty bottles, by this these retailers and middle man push their product in the market. And that’s why Coca-Cola seen more in the market. And they have a good sale in the market because according to the expert which product seen more in the market that sells more/
“Seen as Sold”
They do agreements with a shopkeepers and stores to exclusive sale in those stores. These stores are called as KEY accounts in their local language.
Different Price In Different Seasons
Some times Coca-Cola Company change their product prices according to the season. Summer is supposed to be a good season for beverage industry in Bangladesh.
So in winter they reduce their prices to maintain their sales and profit. But normally they reduce the prices of their pet bottles or 1 litter glass bottle.
Promotion Strategies
Getting shelves
They gets or purchase shelves in big departmental stores and display their products in that shelves in that style which show their product more clear and more attractive for the consumers.
Eye Catching Position
Salesman or the Coca-Cola Company positions their freezers and their products in eye-catching position. Normally they keep their freezers near the entrance of the stores.
Sales Promotion
Company also do sponsorships with different college and school’s cafes and sponsors their sports events and other extra curriculum activities for getting market share.
UTC Scheme
UTC mean under the crown scheme, Coca-Cola often do this type of scheme and they offer very handy prizes in it. As once they offer bicycles, caps, tv sets, cash prizes etc. This scheme is very much popular among children.
Distribution Channels
Coca-Cola Company makes two types of selling
Direct selling
Indirect selling
Ä Direct Selling
In direct selling, they supply their products in shops by using their own transports. They have almost 450 vehicles to supply their bottles. In this type of selling company have more profit margin.
Ä Indirect Selling
They have their whole sellers and agencies to cover all area. Because it is very difficult for them to cover all area of Bangladesh by their own so they have so many whole sellers and agencies to assure their customers for availability of Coca-Cola products.
Facilitating the product by infrastructure
For providing their product in good manner, company has provided infrastructure these includes:
· Vizi Cooler
· Freezers
· Display racks
· Free empty bottles and shells for bottles
Advertisement
Coca-Cola Company use different mediums
· Print media
· Pos material
· TV commercial
· Billboards and holdings
Print Media
They often use print media for advertisement. They have a separate department for print media.
POS material
Pos material mean point of sale material this includes; posters and stickers display in the stores and in different areas.
TV Commercials
As every body know that TV is a most common entertaining medium so TV commercials is one of the most attractive way of doing advertisement. So Coca-Cola Company does regular TV commercials on different channels.
Billboards and Holdings
Coca-Cola is very much conscious about their billboards and holdings. They have so many sites in different locations for their billboards.
Expectations for the Coming year
Every thing starts from the attitude of consumer’s behavior. And the basic key to attract the consumers is to throw the “money away”
And positive feeling felling with the brand, which they used to have Coke want to advertise their products heavily in the coming year. And it will take the 10% of their profits. And when we take it as a global level it is $ 1 billion.
Coming year is the challenging year for the industry of Coke. They have to take lots of decisions that how to increase the production and where they have to spend money. For gaining success in coming year, they have to have some important things like:
1. Loyal Consumers are important for Company’s success.
2. Worker should be the brand centric not the promotion centric.
3. They should know how much to for the brand acivities.
4. They should also know that how much to do with the promotion activities for brand.
How Coke determine the yearly Budget
Coke determines its yearly budget by
· Sales volume
· Profitability
· Target volume
Sale Volume
Coke determines its yearly budget through the sales volume. They first concentrate on the thing is “what is the condition of their sales?” if the condition is good of their sales then they definitely increase their production and sales volume. Otherwise, they concentrate on their old strategies.
Profitability:
The second thing through which they determines budget is the
“profit”. If they are getting profits with the high margin, then they definitely want to increase their profits in the next coming year. Every organization runs based on getting high profits. No organization wants to face Loss in their business. To get profit is the first priority of Coke.
Target Volume
To run the business every industry has some targets, which they want to achieve in a specific time period. If industry achieves those goals in that period then for the coming year it increases the volume of the target.
So Coke follow the same thing it has also some goals and targets to achieve in the given time period. When they succeed to achieve that target then they increase their target volume in the next year.
Sales promotion Activities
Coca-Cola Cricket
Cricket the most sought after; watched and played game in Bangladesh. The game of cricket has been owned by various brands in the industry for the promotion of their products over a period. It has ranged from tobacco to lubricants to communication companies to banks to airlines and lately ot the beverage industry. They competition has become tougher & tougher as the time has progressed.
Coca-Cola arrange three-nation cricket tournament at May 12, 1998. The three-nation Coca-Cola cricket tourney’s opening match between India and Bangladesh.
Coca-Cola signed a sponsorship agreement with eight of Pakistan’s National Cricket players & two Bangladesh’s National Cricket players. Coca-Cola realizing the fact that cricket is a very strong element by which it can reach it consumers & masses invested in the opportunity and launched a massive campaign on mass media showing all these cricket stars endorsing & complimenting Coca-Cola brand. The Coca-Cola Company developed three TV commercials & four testimonial ads with the player & ran them on the national net work during various cricket matches. These bold steps taken by the Coca-Cola marketing unit acclaimed them many acknowledgements across the board. This campaign helped Coca-Cola to establish its association with the game & the player.