coke

Name: Ayan Rattani Student Number: 1008375161 Case Type: Decision Coca-Cola Case Study Analysis

Coca-Cola is a multimillion-dollar beverage company operating in over 200 countries. It has dominated the cola industry for years and is one of the most recognizable in the world. Its marketing campaigns and portfolio all hold one thing in common, and that is to create a meaningful connection with its customers. Furthermore, looking at the last paragraph of the case, it is evident that this is a decision case with 4 main strategies that need a decision. These are as follows 1) Share a Coke 2) Where Will Happiness Strike Next 3) A Step from Zero 4) Cultural Leadership This report will therefore analyze which promotional strategy is best suited for coke, particularly in the US. Following the success of “share a coke” in Australia, Coke hopes to imitate this success in the US. Share a coke was a nationwide marketing campaign wherein 150 popular Australian names, and names that were Muslim-approved (due to the large Muslim population of Australia) were placed on coke beverages. The aim of this strategy was to encourage customers to buy a coke with their own name, or the name of a friend/family member, and share it with them. This campaign was incredibly successful as it touched the emotion in a customer. Furthermore, it brought about significant media attention due to its unique nature. Whilst it was successful in Australia, the US was controversial as a result of its geographical and cultural diversity when compared to other countries that would receive this campaign. SWOT Strengths Weakness 1) Creative ads 2) Strong management/marketing teams 3) Brand identity, image and valuation 4) Global reach, 200 countries 5) Loyal customers 6) 42% market share - market leaders 7) Financing + human capital a) Happiness machine 8) Strong media presence - lots of viral videos 1) Packaging is not environmentally friendly 2) Health concerns 3) Multiple changes in management 4) Misunderstanding of customer needs a) New Coke 5) Printing share a coke was expensive Opportunity Threats 1) Expand further in the US 2) Soft drink sales globally are increasing 3) Extend coke portfolio to include more than just coke, Sports drinks, Different flavours, tea, flavoured water, etc… 1) Pepsi Competition - 28% market share 2) Competition from different drink categories, sports drinks, shelf-stable juices, flavoured waters, etc… 3) Unhealthy perception - guilty pleasure 4) Cultural and geographical differences

Measurement It is crucial to measure the effectiveness of ad campaigns. Looking at the coke’s “where will happiness strike again” campaign, it is evident that it had a major impact on communication, and bringing people together. It received plenty of positive media attention and plenty of free advertising, however, the impact is hard to measure as it is largely just perception in the mind of a customer. As for the impact on sales, whilst it was obviously important to it, it is hard to link the two because that was not the only ad they released. Coke looks at the communication effect and impacts of its campaign, and whilst it does not directly lead to sales, it does indirectly. Therefore, Coke may choose to look at the sales in addition to the communication ratio as a means to determine a campaign’s success. STP Segmentation The market can be segmented into 6 different segments. Evaluated below is the level of compatibility between the main attributes of the classic coke. Main attributes of classic coke Consumer Segments Taste Low energy levels High sugar concentration Carbonation Health-conscio us consumers Loyal customers Fitness enthusiasts = Level of compatibility Targeting Taking the analysis above into account, classic coke should be marketed towards consumer segments that drink casually and to loyal customers therein increasing sales.

Positioning They can position themselves with campaigns that help promote the product further. For instance, casual drinkers who drink occasionally and loyal customers that love the taste of Coke. 4P’s of marketing Product Coke broadened its portfolio to include Coke zero and diet Coke for the health-conscious segment and the younger generation cornered about Coke’s sugar and calorie content. In addition to their current classic coke and diet additions, they have other carbonated products like Sprite and Fanta. Place The headquarters are located in Atlanta, US, the place of its founding. Coke operated in 200 countries (Eurasia/Africa, Europe, Latin America, North America, and the Pacific) with a global retail market of $340 Billion, with the US accounting for ¼ of its global market share. Coke in the US has a 42% market share, becoming the market leader, Price They use competitive pricing strategies. Most competitors like Pepsi hold similar prices, resulting in a war of taste, nostalgia and image than price. The price is also incredibly inelastic, as a slight increase in coke would lead to a large decrease in sales due to fierce competition from perfect substitutions available in the market. Whilst the case study does not provide pricing for coke, it is safe to assume through personal experience that Coke and Pepsi will have similar pricing in most markets due to their competitive nature and perfect substitution. Promotion Coke is known for trying to find methods of connecting with its customers in ways that make them want to consume the actual product and not just the brand. They used 4 promotional methods to achieve this goal. This includes the following, 1) Share a Coke 2) Where Will Happiness Strike Next 3) A Step from Zero 4) Cultural Leadership

Sports drinks, for example, would help them target fitness enthusiasts and increase their product strength. Short-Term 1) Continue with the promotion of the cultural leadership campaign This has the fewest flaws and increases the brand’s reputation 2) Increase advertising and positioning on their “A step from Zero campaign” According to the STP analysis, the main flaws of the classic coke was that it failed to efficiently target the health conscious and the fitness enthusiasts. By introducing one that has no calories, they can turn this base into loyal customers. OVERALL The best campaign Coke should continue with is the US is the “Share a Coke”. It portrays unity and friendship, increases sales and provides free media coverage.