Coca Cola Dissertation – Research Findings

This post Coca Cola Dissertation Research Findings study about a company market and product analysis.

Research findings

  1. What are the different measures adopted by Coca Cola in the promotion of its products (in relation to wholesalers/distributors & retailers)?

Response from Business Unit President, India & SWA:

Coca Cola is the world’s largest beverage company and it’s a pleasure to be a part this huge family. During its long journey of success story, the company has taken several initiatives to support the promotion of its products. The USP of Coca Cola has been their distribution network which they call as Coca Cola System. They have given lot of efforts to promote their products through this huge chain of retailers strategy and distributors because they know it is through them only that their products can actually reach the end customers.

Coca Cola Dissertation Research Findings

Coke also targets in broadening the choice of alternatives of the customer by offering them a huge array of brands and broadening further slowly and gradually. Coca Cola offers customers popular brands like Coca-Cola, Diet Coke, Fanta, Maaza, Limca, Thumbs Up, Sprite, Minute Maid Pulpy Orange, Minute Maid Nimbu Fresh, Minute Maid 100%, Burn, Kinley and Georgia range of tea and coffee.

 Research Findings & Data Analysis

  1. Response from Vice President Public Affairs and Communication, India & SWA:

Coca Cola always looks for maximum reach to its end consumers. One of the major promotional activities includes advertising through celebrity endorsements. If we take the example of India, majorly the brand ambassadors of Coca Cola have been Hrithik Roshan, Aishwariya Rai, Aamir Khan, etc. who have been the face of the Indian Film industry. All of them have got huge fan base and huge number of followers. So tapping this opportunity has enhanced the acceptability of Coca Cola to a great extent.

Which measure according to you is the most efficient?

Response from Business Unit President, India & SWA:

Well this question is like the egg or the chicken causality dilemma. It is tough to choose any of the initiatives and mark it as the major contributor for the success story of Coca Cola. All the initiatives are equally important. If the number of brands is not increased, customers will have a tendency to switch to other alternatives available in the market. So increasing the array of brands is very critical to sustain in long term basis. At the same time if the products are not reaching the end consumers through an efficient supply chain, the whole purpose of coming up with new brands will be a big failure. So maintain an efficient network of retailers and distributors is also very significant keeping the growth and sustainability of the company in mind.

Response from Vice President Strategy and Innovation, India & SWA:

In this long history of sustainability, Coca Cola has taken number of initiatives or moves in the promotion of its products. Among all these the most significant has been the success of the Coca Cola System. The strong network of grocers and distributors across the globe has been the key to success for this beverage giant.

What are the incentives given to bottlers which help in the growth of company’s sales?

Response from Vice President Finance, India & SWA:

There have been more than 300 bottling partners of Coca Cola who have played a vital role in the success of the company. They have been a very important part of this Coca Cola System. Concentrate and beverage bases are manufactured and sold by the Coca Cola Company to these bottling partners. Finished beverages are prepared by the bottling partners by adding sweetener, carbonated water or water with the beverage bases. After the beverage is finally produced, they are packaged in cans, bottles etc and then sold to the distributors or retailers.

As a measure to incentivize the bottling partners often discount offers are given to them when beverage bases or concentrate are sold to them. They also promote the bottling companies who end up selling the higher number of products to next player in the value chain. The incentives are either by cash or by kind. Cash incentives are majorly cash discounts on the beverage base sale. Incentives in kind majorly happen when Coca Cola sells major part of their products to those bottling partners.

According to you, what are the promotion measures of company that tempt the urban people and rural people to buy Coca Cola’s products?

Response from Vice President Strategy and Innovation, India & SWA:

The major strategy for tapping both the urban and rural market has been base on three A’s: Availability, Affordability and Acceptability.

Availability focuses on the availability of the products to the end consumers. The centralized distribution system of Coca Cola has made it happen that Coca Cola products are reaching in every corner of the world even in the rural areas.

Affordability majorly emphasizes on the product pricing which makes it very much affordable for the customers. Initially they used to sell 300ml bottles. But they realized that in many areas, especially in the rural areas 300ml bottles are not that famous as it was majorly observed that the 300ml bottle was shared by two persons. So they came up with 200ml bottles with lower prices mainly for the rural market and it ended up to be an instant hit in the market.

Acceptability emphasizes on creating a desire in the mind of the customers and convincing them to purchase the product. In achieving this, Coca Cola majorly focused in television commercials through celebrity endorsements. In countries like India, celebrities from Indian theatre Industry have huge fan bases and followers especially in the rural areas. So television commercials through these celebrities along with catchy punch lines “Thanda Matlab Coca Cola” (Cool means Coca Cola) were found to be very effective in creating a mark in the mind of the customers.

Which product of Coca Cola you sell the most? Why do consumers prefer that product more?

Response from Senior Vice President Operations, India & China:

There is no partiality with the products. So all products are sold with the same intent: to outsmart its other products in terms of sales figures. However the soft drink products like Coke, Diet Coke, Thumbs Up, Fanta, etc. have been long in the market compared to the other products like Minute Maid pulpy Orange and Minute Maid Nimbu Fresh. So the acceptability of those products is also higher than that of the latter. In terms of sales figures they are still behind the soft drink products specially Thumbs Up and Coke, though they catching up fast with other products. Common people are more familiar with the soft drink products as they have been consuming them since long ago and moreover they have been viewing the television advertisements of these products for a long time. So they have a sense of familiarity towards these products.

Among all the soft drink products major sales are experienced for Thumbs Up and Coke. Low calorie soft drinks like Diet Coke is also getting sold in huge numbers and is mainly preferred by ladies and above middle aged people. So it can be said that among all products cola flavor is the most preferred flavor of soft drinks according to the trends of market.

Are the supplies to rural areas increasing? If yes, how much in comparison to growth in urban areas?

Response from Senior Vice President Operations, India:

The supplies to the rural areas are increasing significantly. This is because of the strategy based on three A’s: Availability, Affordability and Acceptability. Availability focuses on the availability of the products to the end consumers. Affordability majorly emphasizes on the product pricing which makes it very much affordable for the customers. Acceptability emphasizes on creating a desire in the mind of the customers and convincing them to purchase the product. Because of the successful execution of the strategies and increase of availability, affordability and acceptability in the rural market, the demand has also increased from those areas. To satisfy the increasing demand and to tap the untapped market supply has automatically increased to rural markets. This penetration in the rural market has resulted in an overall growth of almost 10%.

The archrival Pepsi is more of a competition to Coca Cola in urban areas or rural areas?

Response from Vice President Public Affairs and Communication, India & China:

Pepsi pose a serious threat to Coca Cola. The competition is tougher in the urban market. In rural areas people do not have their education level as high as that of urban people. To them a cola drink from Coca Cola or Pepsi does not make much difference. They cannot do much of comparison between the two because of the intelligence level of the people in general. So Coca Cola does not find a huge threat in the rural market as long as they are reaching out to the end customers efficiently through their supply chain or distribution channel.

But in the urban areas people do much of comparison between the products of Coca Cola and Pepsi. They find differences in taste of the cola drinks offered by Coca Cola and Pepsi. Apart from the taste the advertising campaigns also segregate the customers. The Coca Cola campaigns mainly focuses on togetherness, sharing happiness etc and emphasizes much on “Us”. Whereas the campaigns of Pepsi are more “Me” oriented and focuses on individual satisfaction to a large extent. So individuals who are more social and friendly would be touched more by the campaigns of Coca Cola. Whereas campaigns of Pepsi would attract more people who are more individualistic and love to be happy and content with them. Thus in the urban market Coca Cola and Pepsi rivalry is strongly exposed.

Is India today an important market for Coca Cola?

Response from Business Unit President, India & SWA:

Coca Cola in India caters to millions of customers across the country through a huge array of products like Coca-Cola, Diet Coke, Fanta, Maaza, Limca, Thumbs Up, Sprite, Minute Maid Pulpy Orange, Minute Maid Nimbu Fresh, Minute Maid 100%, Burn, Kinley and Georgia range of tea and coffee. They have got a network of more 1.5 million outlets in India. Tremendous support for Community programs all over the nation is provided by Coca Cola India. This has been done with an emphasis on education, health and water conservation and more than 500 rain water harvesting structures spread across 22 states of the nation has already been undertaken.

Apart from that, India has got a majority of rural population. Coca Cola has its own market penetration strategy framed for the rural market which is proven in other parts of the globe. So India being a country where they can apply their success formula, it is always important for Coca Cola to consider India as one of their major target markets.

How is the market in India as compared to other countries?

Response from Business Unit President, India & SWA:

India has always been a strategic growth market for Coca Cola Company. If we look at some of the statistical figures we will find that India ranks among their top 10 countries in terms of sales volume globally. India also happens to be the largest market in the Eurasia and Africa Group. Business of Coca Cola in India has been growing at a stable rate for more than five years now. So the company’s goal would be to continue this momentum in future as well. India’s demographic features and social and economic dimensions are immensely contributing to the growth of the company in this nation. They need to continue with the assured growth of offerings to be the ready to drink non-alcoholic beverage manufacturing company of the preference of the local consumers.

So as a conclusion it can be said that unlike other markets like US, UK and other European Countries, India offers much more to Coca Cola in terms of growth and expansion. Coca Cola can also strategize to enter the neighboring countries of India like Pakistan, Sri Lanka, Bangladesh, etc. through India. So it is rightly said that India offers strategic growth to Coca Cola.

Recommendation

After analyzing the entire report and going through the research findings, several suggestions can be recommended to Coca Cola to revamp their growth in the emerging nations like India, China, Pakistan, etc. However it should be kept in mind that Coca Cola should not get deviated from their own USP following the recommendations.

  • Coca Cola should never get deviated from exploiting its value chain. The manufacturing and distribution network of Coca Cola is called as Coca Cola System. This is the USP of Coca Cola which has stretched its reach in every corner of the globe and still stretching (Krishna, 2012). In the value chain Concentrate and beverage bases are manufactured and sold by the Coca Cola Company to these bottling partners. Finished beverages are prepared by the bottling partners by adding sweetener, carbonated water or water with the beverage bases. After the beverage is finally produced, they are packaged in cans, bottles etc and then sold to the distributors or retailers (Yu, 2005). Coca Cola should always give valuable effort to sustain and develop even better network of retailers and distributors through which they can actually reach the end consumers. It is actually creates a very important aspect of the market penetration. The better the network of retailers and distributors the more the availability of Coca Cola products. So distribution channel should always be on focus for the company.
  • The three A’s of market penetration are Availability, Affordability and Acceptability. To make a mark in the in the market and the industry, Coca Cola can’t make a deep impact in the affordability considering the competition in the market (Lake, 2010). Focusing solely on the pricing model would not work wonder for Coca Cola as Pepsi would easily replicate the same in the market and remove the thin line of difference between the competitors. But Coca Cola can definitely make huge difference in the Availability riding on the success of the huge network of retailers and distributors of the Coca Cola System. To tap the untapped market Coca Cola must leverage on the highly efficient network of retailers and distributors to reach out the end customers (Mayard & Tian, 2004). Coca Cola can also make a huge difference in the Acceptability in the market. Coca Cola majorly execute campaigns focusing on the togetherness and sharing of happiness. This theme of the campaigns can touch the customers from the core and can make them go for their brand.
  • Coca Cola offer a huge of array of products to the customers in the market. They include Coca-Cola, Diet Coke, Fanta, Maaza, Limca, Thumbs Up, Sprite, Minute Maid Pulpy Orange, Minute Maid Nimbu Fresh, Minute Maid 100%, Burn, Kinley and Georgia range of tea and coffee (Krishna, 2012). Coca Cola should continue with this huge array of products and probably should come up with new brands on priority basis with more customized features. Their products have covered the major chunk of the market and cater to the major segment of customers. They should also focus on the niche segment and come up with more customized products to attract that niche segment of consumers to go for Coca Cola brands (Krishna, 2005). This huge range of brands of Coca Cola has given the customers a lot of choice to choose from the available alternatives in the market. If Coca Cola can come up with even more range of brands then they can tie up their customers so that they can toggle between their products only without switching to other brands.
  • The majority of the business is coming from the urban market. But if Coca Cola has to expand their reach and revamp their growth, they have to stretch their reach in the rural market. There is a huge untapped market in the rural areas all over the globe which can still be captured with lot of potential. Leveraging on the highly efficient retailer and distributor network, Coca Cola need to reach out to this market. Consumers in this segment are not much choosy while going for the soft drink of their choice. They do not understand the thin line of differences in taste between Coke and Pepsi. They just take them as cola drink and will go for the one whichever is available. So Coca Cola has to be very cautious in this part as they need to be on their toes to enhance their Availability to this segment. Acceptability can also play an important role in capturing this untapped segment of the market. Celebrity Endorsements would pave the way for this in a great extent.
  • Coca Cola should always be in a position to pull their socks when it comes to competing with Pepsi. The competition is tougher in the urban market. In rural areas people do not have their education level as high as that of urban people. To them a cola drink from Coca Cola or Pepsi does not make much difference (Krishna, 2012). They cannot do much of comparison between the two because of the intelligence level of the people in general. So Coca Cola should always be two steps forward from Pepsi in reaching out to the end customers efficiently through their supply chain or distribution channel. In the urban areas people do much of comparison between the products of Coca Cola and Pepsi. They find differences in taste of the cola drinks offered by Coca Cola and Pepsi (Kwon, 2008). So Coca Cola should look into adding more brands in their array of products so that customers can toggle between their products only rather than switching to other brands like Pepsi. Apart from the taste the advertising campaigns also segregate the customers. The Coca Cola campaign mainly focuses on togetherness, sharing happiness etc and emphasizes much on “Us”. Whereas the campaigns of Pepsi are more “Me” oriented and focuses on individual satisfaction to a large extent (Lake, 2010). So individuals who are more social and friendly would be touched more by the campaigns of Coca Cola. Whereas campaigns of Pepsi would attract more people who are more individualistic and love to be happy and content with them. So Coca Cola should stick to campaigns which are catchier for majority of the consumers.
  • India has always been strategegy growth marketing for Coca Cola. So India should always be focused to enhance its growth all over the globe. They have got a network of more 1.5 million outlets in India (Krishn, 2005). Tremendous support for Community programs all over the nation is provided by Coca Cola India. This has been done with an emphasis on education, health and water conservation and more than 500 rain water harvesting structures spread across 22 states of the nation has already been undertaken. India’s demographic features and social and economic dimensions are immensely contributing to the growth of the company in this nation (Krishna, 2012). They need to continue with the assured growth of offerings to be the ready to drink non-alcoholic beverage manufacturing company of the preference of the local consumers. Coca Cola can also use their success story in India to tap the neighboring nations as well so that it can continue its run all over the globe with grand success.