MarketingPlan for Beverage Provider: Coca Cola Company
Theaim of this paper is to generate a market plan for the Coca-ColaCompany by examining the internal and external business environmentthrough SWOT analysis, carrying out research to select targetmarkets, outlining the marketing objectives of the firm, and creatinga plan for implementations and control.
CocaCola has a mission of refreshing the world in mind, body and spirit,as well as instigating optimism and joy moments using its brands andactions, establishing value, and bringing a difference in the entiremarket. The objectives recommended for consideration by the Coca ColaCompany are: to secure 60 percent of the beverage sector market byApril 2018, to attain a 20 percent return on capital utilized byMarch 2018, to create more market awareness of the company’sproducts in the market, to contain the rivalries from competitorsthrough proper marketing and brand innovation strategies, and toexpand the size of the business by 10 percent in the United States byApril 2018. Situational analysis identified Coca Cola’s strengths(strong brand value, efficient advertisement), weaknesses(over-reliance on bottling plants, high caloric products),opportunities (large market, partnerships), and threats (substituterivalry, varying customer attitudes and demands). An analysis oftarget market selection identified differentiated marketing as themost ideal for Coca Cola Company.
Anevaluation of promotional marketing mix determined that productpositioning, packaging, and branding are valued by Coca Cola.Regarding price, the company makes use of penetration pricing. Thepromotional mix for Coca Cola’s use combines several strategiesnamely advertising, sales promotion, and personal selling, as well aspublic relations. Finally, regarding place, intensive distributionmethod is recommended for Coca Cola. For a marketing plan to beeffective, it is implemented through adequate management of theorganization.
MarketingPlan for Beverage Provider: Coca Cola Company
Marketingplanning connotes an organized process of performing research andanalyzing the market situation of a company with the aim to developand document its objectives of marketing alongside the mostsuccessful strategies and programs (Wood,2013).Once the above are achieved, the market plan is completed byassessing and managing activities to attain the intended objectives.A marketing plan is priceless for any business as it assesses thefirm, offers directions and guidance, and allows the setting ofobjectives, as well as the identification of alternatives andstrategies. Additionally, it aids in precise decision making andeliminates incidences of rushed decisions and related risks. Throughmarketing plan, Wood(2013) clarified that companiesare kept in tune with the marketplace trends, the needs of theclients, and cognizant of the nature of competition in place.Likewise, planning assists in adequate resource utilization andplaces a business in a position of readiness to react to theunexpected changes in the market environment.
Accordingto Whalen& Holloway (2012), asuccessful market plan considers the business mission and objectivesalongside the situation of the external and internal environment, aswell as market target and segmentation, and the marketing mixstrategies. Once the above are clarified, it is possible to come upwith various implementation and control measures that can propel thecompany towards its projected objectives regardless of any marketbarriers. The aim of this paper is to generate a market plan for theCoca-Cola Company by examining the internal and external businessenvironment through SWOT analysis, carrying out research to selecttarget markets, outlining the marketing objectives of the firm, andcreating a plan for implementations and control. However, the studyprovides background information of Coca-Cola Company before theelements of the market plan, that is, business mission, businessobjectives, situational analysis, target market selection,promotional marketing mix, and implementation, are considered.
Coca-ColaCompany’s Background Information
CocaCola Company was founded in the year 1886 in the United States,Georgia, Atlanta, which has remained as its headquarters since thebusiness initiation. Over the years, Coca Cola has grown and is nowamong the leading companies operating globally. At present, thecompany ranks third regarding brand value, only trailing Apple Inc.and Google Inc. Coca Cola is the largest producer, supplier andmarketer of soft drinks or non-alcoholic beverages in the UnitedStates and the world as a whole. Its flagship product, Coca-Cola, hasmade it famous in the globe and placed it as the largest UnitedStates’ corporation (Nganga,2014).Currently, Coca Cola is a worldwide beverage manufacturer with grandintention to further expand the brand. The company possesses most ofthe soft drinks present in the coolers and vending machines in theUnited States and the rest of the globe. However, because it operatesin the highly competitive beverage sector, Coca-Cola faces rivalryfrom such companies as PesiCo (the major competitor), Nestle, and DrPepper Snapple group, Inc (Pendergrast,2013).
Someof the brands associated with the company are Fanta, Diet Coke,Coca-Cola, and Sprite, as well as other products like Minute Maid,PowerAde, and Oasis. The company distributes its beverage products inover 300 countries of the world. The global presence of Coca-Cola isexceptional and the company’s logo, strategies of advertisement andcolors are among the highly distinguished in the United States andthe entire world (Nganga,2014).However, because the company serves a diverse environment made up ofvaried cultures and market competitors, it is important to base itsoperation on a clear market plan with patent business mission,objectives, nature of the internal and external environments, targetmarket, marketing mix strategies, and implementation and controlmeasures. That can be attained by analyzing Coca Cola’s marketingstrategies and the environmental forces which affect its operationsto come up with implementation and control considerations beneficialto the company.
Acompany’s mission statement aids in understanding of the reason forthe existence of the business. As pointed out by Pendergrast(2013), CocaCola has a mission of refreshing the world in mind, body and spirit,as well as instigating optimism and joy moments using its brands andactions, establishing value, and bringing a difference in the entiremarket that leaves everybody (the consumers, employees, employers,and partners) satisfied. The values considered by the company arepartners, people, portfolio, productivity and profit, and the planet.Throughout its operations, the company endeavors to build a culturewhere people are motivated to give their best through action, whileclients develop trust in the brand and become resistant to the marketpressures of other rivals (e.g. PepsiCo) trying to influence them todevelop interest for the competing brands.
Inany case, Nganga(2014) argued that thebeverage market is open to competition Coca Cola has experiencedsuccess and failure incidences that propelled it to formulate themission above. For instance, although the soft drink products of thecompany (e.g. Coca-Cola) have been famous since their introduction,the issues of health such as obesity led to the criticism of the highsugar contents in the drinks. That prompted the Coca Cola to considerthe welfare of its clients in the mission statement, and to work onproducing Diet Coke that had little concentration of sugar. Byconsidering the values of the people and market needs, Coca Colacomes up with brands that refresh the world while leaving everybodyhappy and satiated (Pendergrast,2013).Thus, the company, through proper mission statement, has been able tocontain its rivals in the marketplace and maintain an ever growingpopulation of loyal customers alongside revenue expansion andimproved marketing through brand innovation and product promotion.
Itis necessary for a market plan to outline clear objectives that areattainable with the available resources, that is, the workforce,finance, time, machines, and materials. Well structured objectivesgive hints about where the company intends to go, and the timelinefor making such achievements (Wood,2013).The following are some of the objectives recommended forconsideration by the Coca Cola Company. First, the market shareobjective of the plan is to secure 60 percent of the beverage sectormarket by April 2018. Second, the profitability objective is toattain a 20 percent return on capital utilized by March 2018. Third,the promotional objective is to create more market awareness of thecompany’s products in the market. Fourth, the company’s objectivefor survival is to contain the rivalries from competitors throughproper marketing and brand innovation strategies. Finally, thecompany’s objective for growth is to expand the size of thebusiness by 10 percent in the United States by April 2018. The aboveobjectives are only attainable once the company is familiar with theenvironmental situation, that is, the strengths, weaknesses,opportunities, and threats in place, all of which are betterappreciated through SWOT or situational analysis discussed below.
Situational(or SWOT) Analysis
Situationalmarket analysis examines the internal and external environment of abusiness, and comprises of business strengths, weaknesses,opportunities, and threats, which are abbreviated as SWOT. It isimperative that Coca Cola thoroughly scrutinize the businessenvironment within which it operates to appreciate the factors thatcontribute to its success and survival, as well as failure in theUnited States and the globe’s beverage sector. The internalbusiness environment denotes forces within the business that can bemanipulated or controlled to achieve results. They include thestrengths and weaknesses of a company, in this case, Coca Cola. Putanother way, the internal environment comprises of the effectivenessof the production activities as aided by efficient management skillsand proper communication channels (Sharma& Lambert, 2013).To successfully run and examine the internal environment, Coca Colamust constantly perform the appraisals of its business activities andrespond to forces that facilitate insufficiencies during the processof production or consumption.
Onthe other hand, the external business environment signifies thosefactors outside the company that impact the entire sector and economy(Whalen& Holloway, 2012).Any alterations in the external setting culminate in businessopportunities (positive forces acting from outside the businessenvironment) or threats (external business environment barriers),something Coca Cola Company should consider in its marketing plan.Accordingly, Pendergrast(2013) asserted that economicfluctuations, varying consumer values and attitudes, and demographicconfigurations significantly affect the achievement of Coca Cola inthe beverage industry market and the reception accorded to thebusiness by the clients. To appreciate how the internal and externalenvironment impact the success of Coca Cola, a SWOT analysis isperformed to reveal the strengths, weaknesses, opportunities, andopportunities of the company in the beverage industry market.
CocaCola Company persists as a leading business in the manufacturing,supply, and marketing of beverage products. Its appeal is not limitedto the United States where the operation is headquartered but rather,the entire world culture values the brand. Over-romanticizing is amajor constituent of the image of Coca Cola brand. That is an imagemost customers have enjoyed for a while, resulting in the creation ofpermanent brand loyalty. Coca Cola displays its image on such itemsas hats, T-shirts, and collectible memorabilia. The result of thestrategy has been a highly recognizable brand, placing Coca Colaahead of its rivals concerning brand loyalty (Nganga,2014).
Thesecond strength of Coca Cola relates to its bottling system whichpermits the firm to operate globally while simultaneously takingconsideration of the local approach. The bottling firms are underlocal ownership, and managed by self-governing business entitiesgiven the go-ahead to supply or redistribute Coca Cola products.Because the company lacks absolute control of the partnering bottlingplants, the primary financial source for the company comes from thesale of concentrates to the bottlers who, in turn, redistribute theproducts to the consumers (Pendergrast,2013).
Third,Coca Cola is involved in the sponsorship of Olympics around theworld, and distributes cold products to cool off the spectators ofthe games. That builds the company’s brand image, making it moresuperior and preferred relative to soft drinks distributed by suchcompetitors as PepsiCo and Dr Peppers Group, Inc. Furthermore, thecompany has, through innovation, come up with many brands (apart fromthe Coca-Cola) that it has adequately marketed to enjoy strong brandimage (Nganga,2014).Finally, Pendergrast(2013) asserted that thecompany’s commitment to partake seasonal advertisement awarenesshas reinforced its presence in the beverage industry market. Throughsuch initiatives as TV Christmas and summer adverts, Coca Cola hasattracted, and continues to lure more customers into utilizing itsproducts. In summary, Coca Cola’s strengths lie on its strong brandvalue, participation in Olympic Games, presentation of diversebrands, exemplary engagement of partners, and efficient advertisementprograms.
Businessesencounter weaknesses within the internal environment which requireconstant monitoring and control to adequately report productivity andexpansion goals. In spite of domestic and international marketsflourishing, Coca Cola experiences several challenges worthrecognition and attention. First, Pendergrast(2013) determined that thecompany lacks its own bottling plants to oversee the packaging of themanufactured concentrates. That prompts Coca Cola to over-rely on thestrategic partners for packaging. Consequently, Coca Cola productshave been reported unavailable in some markets, for instance, inPakistan, due to the failure of Mehran Bottlers to avail enoughbottles to the company for concentrate packaging. Second, Coca-Colaand associated products face criticism related to health problemsassociated with their consumption, for instance, teeth decay andobesity caused by the high caloric (sugar) contents of the softdrinks (Pomeranz,Munsell & Harris, 2013).Unfortunately, the health problems are compounded by the addictionissue facing most clients utilizing Coca Cola beverages peopleattached to the soft drinks tend to consume them on a daily basis,and are at high risks of teeth and weight problems. Finally, some ofits marketing strategies, especially Coke Zero and Desani, have beenunsuccessful, forcing the firm to rethink its strategies all overagain because such failures in the supply chain management pave waysfor the success of competitors like PepsiCo (Nganga,2014).
Brandrecognition is among the leading factors that affects the competitiveposition of Coca Cola in the beverage sector. All parts of the UnitedStates, as well as about 94 percent of the world markets, are awareof Coca Cola’s brand name, and are eager to consume the products.Therefore, the company has an opportunity to expose more people toits brand name through promotional and advertising activities(Pendergrast,2013).Besides, the bottling system of Coca Cola enables the firm tocapitalize on endless growth opportunities in the United States andthe globe. The strategy, that is, partnership with the bottlingplants, presents the company the chance to offer its services to anexpansive geographic, diverse area. Packaging alterations have alsoimpacted sales and positioning of the company, although the public israrely influenced by new products. Additionally, the company has theopportunity to invest in developing states, as well as to initiatesocial responsibility in narrower demographics in an attempt toexpand its market and generate more revenue to for self-sustenance(Nganga,2014).
Presently,the threat attributed to new practical rivals in the beverage sectoris not as significant as in other industries. However, Nganga(2014) concluded that threatsrelated to substitutes remains high, and Coca Cola Company must takeconsideration of the situation in its marketing communications. Thepotential substitutes which continually challenge Coca Cola are tea,hot chocolate, milk and juice offered by food restaurants such asMcDonalds. Regardless of Coca Cola controlling about 40 percent ofthe soft drink marketplace, the shifting health awareness of thebeverage sector may have adverse outcomes on the company’s growthand expansion (Pomeranzet al., 2013).Of course, Coca Cola has diversified into the markets, permitting thefirm to enjoy pronounced market share and counterbalance any lossesaccrued as a result of fluctuations in the market. Another threatthat Coca Cola must overwrite relates to the buying power of theclients. The competition between Coca Cola and PepsiCo has generateda very slow moving sector that compels the management tounremittingly react to the varying customers’ attitudes and demandsor face the risk of reduced market share amidst competition. Finally,the customers are at liberty to other soft drinks with little cost orconsequences, that is, the fast moving foods offered by restaurantslike McDonalds, Subway, and Starbucks (Nganga,2014).
Fromthe SWOT analysis, it can be deduced that Coca Cola has many positivefactors (strengths and opportunities) in favor of its prosperity inthe soft drink industry. However, there are several negative forces(weaknesses and threats) that may deter the company from achievingits planned objectives in the short and long terms. While it isrecommended that the company should exploit the positive factors toexpand and build more brand image, disregarding the negative factorsmay result in total market failure. Therefore, Coca Cola must makeuse of marketing communication strategies that are considerate of itsstrengths, weaknesses, opportunities, and threats if it is to beatits market rivals in the ever-changing environment or culture ofbeverage consumption in the future. The next section presentsdiscussions on target market selection and promotional marketing mixstrategies essential in overcoming Coca Cola’s weaknesses andthreats, as well as exploiting the strengths and opportunitiesdiscussed above.
Afterthe completion of SWOT analysis and determination of the objectivesof the company, there is a need to select the market segment with thegreatest potential for the available services and products (Whalen& Holloway, 2012).In any case, a business cannot produce all products (there must bespecialization) to everybody (there must be a particular targetpopulation in the market) because the available resources are limitedand must be concentrated or channeled towards a specific area. Bydefinition, the target market represents the section of consumersthat receives the maximum attention or focus of a company (Sharma& Lambert, 2013).Regarding Coca Cola, the target market denotes the segment where thecompany concentrates its marketing endeavors or resources due to thebelief that by focusing on that particular segment, it is possible tosucceed and register maximum productivity and growth.
CocaCola’s target market is very extensive because the company works tosatiate the needs of diverse customers. In essence, Pendergrast(2013) observed that theconsumers covered by Coca Cola extend from the diet-consciousindividuals (where Diet Coke is provided) to the average citizens whocrave for the regular Coca-Cola and related brands like Fanta andSprite. Most products of Coca Cola satisfy all age groups, withpeople consuming different brands based on their age brackets. CocaCola market is considerably large and accommodates both sexes,thereby facilitating greater diversification of products. Accordingto Sharma& Lambert (2013), the fourbroad strategies of market segmentation that companies may considerusing are the method of mass marketing, the approach of concentratedmarketing, and the tactic of differentiated marketing, as well as thetechnique of niche marketing. Which of these strategies suits CocaCola Company?
Thestrategy of mass marketing is aimed at appealing to the largestmarket segment while overemphasizing demographic disparities to coveras many consumers as possible. The strategy concentrates on highvolume of sales at comparatively lower price points. The bottom-lineis to provide useful products to diverse consumer segments withdistinct needs. This method is only successful where the productspresented to the demographically varied customers are necessities,which are purchased by many people regales of their cultural orideological differences. Such products are majorly staples, that is,goods that customers buy often once they wear out or are utilized(Sharma& Lambert, 2013).By manufacturing and distributing products required by a large marketat competitive prices, Whalen& Holloway (2012) argued that thestrategy facilitates increased sales volume and reduces the operationcost through mass production. However, Coca Cola is involved in theproduction of a wide array of soft drink brands, implying that itserves each market segment with a unique product. For instance, thehealth-conscious population needs Diet Coke, adolescents and normalyouths require regular Coca-Cola and related brands, while othersmake use of such products as Minute Maid and Oasis (Pendergrast,2013).Because of that variation, mass marketing is not recommended for CocaCola Company.
Regardingconcentrated marketing, a company selects one market segment andconcentrates all its marketing resources toward the chosendemographic portion. The company uses better marketing communicationsin comparison to its rivals to dominate the market. Likewise, thecompany avoids the strengths of its competitors and capitalizes ontheir weakness instead. Put another way, companies using concentratedmarketing avoid large segments with more competitors and focus on onedistinct demographic portion that is least exploited by others(Sharma& Lambert, 2013).Because Coca Cola produces varied soft drink brands that appeal todifferent market segments, it cannot use the strategy of concentratedmarketing (Nganga,2014).That could have been possible if, for example, the company dealt inthe manufacture of Diet Coke alone. In that case, Coca Cola wouldfocus on the market segment of the diet-conscious clients, therebyconcentrating all its advertising efforts towards the group.
Nichemarketing focuses on a selected market segment with maximum potentialto link with a service or product. Whalen& Holloway (2012) noted that thestrategy is effective for firms which are smaller in size and havelimited finance base, and specialized in the manufacture of productsor provision of services that satisfy a particular demographicsegment of consumers. For example, a company may target the couplespreparing for a wedding by providing and marketing wedding gown.Again, the method is not recommended for Coca Cola because, accordingto Pomeranzet al. (2013),the company operates at a global level, has huge budgets, and offersmany products utilized by different market segments.
Indifferentiated marketing, businesses endeavor to appeal to more thanone demographic portion in the market by offering unique productsthat satisfy every segment. All the firm needs are the resources andcapabilities to manufacture and distribute two or more products orbrands while fulfilling the goals of maximizing sales,diversification, and being recognized as a specialist by the diverseclients it serves (Sharma& Lambert, 2013).Therefore, differentiated marketing is the strategy recommended foruse by the Coca Cola Company. That is because the company a variedmarket comprising of consumers with different age groups, gender, andideologies or cultures. For instance, Diet Coke is produced to meetthe needs of the weight-conscious individuals, while regularCoca-Cola, Fanta, and Sprite fulfill the requirements of the normalpopulation of children, adolescents, and youths (the average humancategory). Other products include Minute Maid, which is popular amongfemales and children than adult males, coffee (majorly consumed byadults), and iced tea used across genders and age groups (Nganga,2014).In other words, every group of soft drinks meets the needs of aparticular market segment out of the many demographic portions servedby Coca Cola, although most of the brands satisfy the commonpopulation.
Themarketing mix is certainly a critical phase of the marketing planprocedure. At this stage, there is a verification of the strategiesof marketing for every service or product. Particularly, themarketing mix signifies a blend of four elements namely product,price, place, as well as promotion, all of which are also referred toas the 4P’s. The above factors constitute the mainstay of themarketing strategy of companies. In this stage of the process ofmarketing plan, the 4P’s must be devised to fulfill the needs ofthe target market segments, as well as attain the goals of marketing.The leading enterprises constantly examine and transform theirmarketing mix as a result of the impacts of the internal and externalbusiness forces. Often, such companies assess the nature of externalenvironments within which they operate to make the most of theirmarketing mix components (Akgün,Keskin & Ayar, 2014).
Inmarketing, the term product is not limited to the physical objectsthat people purchase for use but also services like a movie orholidays where the customers take pleasure in the benefits withoutnecessarily owning the service outcome. Companies must considerproducts in three primary categories identified by Akgünet al. (2014)as the core product, actual product, as well as the augmentedproduct. Regarding the core product, it signifies the purchases of aclient and the gains the buyer derives from the bought items. CocaCola clienteles are purchasing diverse beverages. The actual productcomprises of the ingredients and characteristics that accompany thecore product. The customers are likely to buy Coca Cola products dueto the high standards and quality associated with them. On the otherhand, the augmented product connotes the added benefits related tothe consumption of a product, as well as the services the companyoffers to the consumers. Because nonalcoholic beverages offered byCoca Cola are consumable goods, the level of augmentation is quitelimited. It is important to note, however, that the company provideshelp lines and complaint phone services to cover the concerns of theconsumers who are eager to share feedback or are not satisfied(Nganga,2014).
Afteran enterprise has made a decision on the market segments to competein, established an apparent portrait of the potential customers andidentified its product, it should create the strategy of positioningto ensure that the product reaches the maximum number of clients.Positioning refers to the practice of developing the product image inthe customers’ minds compared with that of the rivaling products.Through positioning, the consumers can appreciate the uniqueness of aproduct compared to other competing ones (Akgünet al., 2014).Coca Cola should endeavor to establish further positions to guaranteetheir products better competitive advantage in its market segments.Coca Cola’s positioning has been achieved through glocalization,partnership, and offering of many brands. Through glocalization, CocaCola positions affectively in international soft drink marketplacesby manufacturing local brands which satiate the requirements of thenew client segments or targets. Partnerships also contribute to CocaCola’s successful positioning, for instance, it uses McDonalds as adistribution channel for its products in the United States(Pendergrast,2013).
Thecompany also benefits from its engagement with the bottling plantswhich package the products in attractive containers and redistributethem to many consumers. Packaging, although not highly recognized byfirms, is a major factor to assess. According to Wood(2013), packagingnot only safeguards products through the course of transportation butalso promotes the product as it helps in distinguishing it from thatof the market rivals once a customer accesses and starts utilizingthe product. Coca Cola has derived immense advantages from packagingits products with incentives, as well as endorsements on the labelingas key strategies of promotion aimed at expanding sales volume andprofits (Pomeranzet al., 2013).
Aboveall, Coca Cola provides brand variety that enables it to position inseveral demographic portions of the young, teenage, youth, and theelderly, as well as the males and females, and the health-consciouspopulations. The company’s clients are allowed to select fromjuices (e.g. Minute Maid), teas (e.g. Marocha), bottled water (e.g.Dasani), sports drinks like Aquarius, and leading brands such as DietCoke (weight-conscious customers), Fanta, Coca-Cola, and Sprite.Since the initiation in the year 1886, Coca Cola Company has workedtirelessly to develop and promote its brand name with the aim ofachieving global recognition (Pendergrast,2013).The topmost recognized brand is Coca-Cola, with over 94% of thepopulation of the world aware of the word. The red and white colorsof Coca Cola, alongside the special writings on the packages, arepowerful global trademarks that promote the company’s brands.Regardless of the many branding strategies in place (e.g. genericbranding, family branding, and hybrid branding, and privatebranding), Coca Cola makes use of individual branding strategy inwhich the company assigns unique names to its products, for example,Sprite, Fanta, and Coca-Cola (Nganga,2014).
Priceis an integral part of the marketing mix because it impacts Coca Colaproducts’ supply and demand it affects the decision of a customerto make purchases. Often, price serves as the difference that compelsthe customers to buy the company’s products and disregard those ofthe competitors in instances where quality and consumptionexperiences are fairly comparable. Consequently, it is noteworthy todevelop pricing policies while considering the perceptions ofcustomers and external forces. That helps in the creation ofequilibrium between the sales and production cost coverage (Akgünet al., 2014).Price tactics are praiseworthy to Coca Cola Company as the determinedvalue influences the sales quantity and benefits accrued for everyproduct unit purchased. Companies must fix a price that attracts thebuyers while guaranteeing the enterprises considerable profitmargins.
Thestrategy of pricing for use by a business must emphasize on theattainment of the outlined marketing objectives and sustain productpositioning while considering the external issues of competition andeconomic conditions. According to Huang& Sarigöllü (2014), fivepricing strategies that companies can utilize are loss leaderspricing, market skimming pricing, price points, penetration pricing,and discounts. Through the years, Coca Cola Company has beenutilizing the penetration pricing to establish in the market. Thecompany’s products penetrated the target market segments. Afterestablishing consumer loyalty through penetration, the prices aregradually increased. The competition between Coca Cola and PepsiCohas intensified because both brands rival for consumer recognitionand satisfaction. Until now, Coca Cola has outsmarted Pepsi, but ithas to sacrifice immediate profits (by lowering prices) to achievelong-run profits (Pendergrast,2013).
Gooddecisions of pricing are made by analyzing what the target marketsare willing to pay against what they see as good quality. Too highprices compel the customers to shift their attention to othercomplementary goods and services, while extremely low prices mayresult in severe losses and closure of businesses. Therefore,businesses make use of one of the three pricing methods namelycompetition-based, cost-based, and market-based pricing approaches(Akgünet al., 2014).Initially, Coca Cola lost ground in its pricing but has recovered itspower by employing completion-based pricing method, enabling thecompany to compete successfully in the beverage sector marketplace.Leader follower pricing takes place in cases of the existence of onestrong company in the market operating as the market leader. Suchenterprise tends to possess a larger market base, loyal consumers, aswell as significant technological edge that is the position of CocaCola in the contemporary market (Pomeranzet al., 2013).The company previously served as a follower but by adopting efficientmanagement, has transformed into the market leader capable ofachieving the recommended objectives. These include surviving in theotherwise competitive beverage industry market, owning 60 percent ofthe market share by April 2018, creating more brand awareness, andattaining a 20 percent return on capital utilized by March 2018.
Inthe current competitive business setting of the 21stcentury, presenting the needed product at the appropriate localityand at the perfect time is not a guarantee of large sales volume andrevenue generation. Adequate communication with the demographicportions of interest is inevitable for the product and businessaccomplishment. As part of the market mix, promotion aids ininforming the potential customers about the company, quality ofproducts, and where to purchase the products, as well as the buyingprices. Additionally, promotion plays a role in persuading theclients to try or taste a modern product, or to engage in thepurchase of the ones that were produced in the past. Thecommunication or promotional mix combines several strategies namelyadvertising, sales promotion, and personal selling, as well as publicrelations (Huang& Sarigöllü, 2014).
First,advertising entails any paid mode of non-individual promotion andpresentation of products through such avenues as billboards,television, newspapers, public or street furniture, or online. Thestrength of using billboards is that many people see and can hardlyavoid the displays. However, it is an outdated advertisement approachthat is increasingly being ignored by clients (Akgünet al., 2014).Although Coca Cola has utilized 3D billboards in the United States,it is time to shift to other approaches as clients are likely todisregard the boards in the future. Television adverts reach manypeople through programs and channels, and can be utilized by CocaCola to expand its market, for instance, the company capitalizes onChristmas advert to lure more customers into buying its brands.However, the company must note that other firms, for example,McDonalds, have flooded the television with intense advertisement offast foods, and must appropriately structure the adverts beforebroadcasting to attract the attention of the target clients (Nganga,2014).
Advertsthrough newspapers and magazines are also recommended for Coca Colabecause the mode targets distinct market segments with highlyreceptive readers. For instance, the company can place adverts inlifestyle magazines while focusing on health, sports, and fitness andhow its products relate to the above areas. The only challengeascribed to the use of magazines or newspapers is that customersoften flick through the pages with adverts which occupy most of thepages (Huang& Sarigöllü, 2014).Alternatively, public or street furniture like football stadium canbe used as advertisement areas because many people attend events heldat the places. This explains why Coca Cola participates in Olympics,in which it provides sports drinks and promotes its healthierproducts. The problem of the method is that it is short term and mustbe renewed frequently to attract clients’ attention. Finally, CocaCola can opt for online advertisement through websites and emails,all of which are cheap and offer good communication platforms.However, the disadvantage in online adverts is the risk of SPAM andviral promotions (Wood,2013).Therefore, Coca Cola should combine the advertisement strategiesabove to offset the weaknesses associated with each and adequatelyreach its target market segments
Regardingsales promotion, which denotes incentives aimed at encouragingclients to purchase products in the short-term, companies make use ofprice deals, loyalty reward initiatives, and contests. Through pricedeals, prices are temporarily lowered to attract more consumers. Themethod is recommended for Coca Cola because it utilizes the pricingstrategy of penetration. Besides, loyalty reward initiatives enablethe customers to obtain points or credits for buying and activatethem for prizes. The approach encourage high influx of new consumers,as well as the establishment of brand loyalty among the existingones, thus, must be considered by Coca Cola to expand its marketbase. Finally, contests are very effective in creating brand loyalty.Consumers are automatically enrolled in contest when they purchase aproduct, thereby encouraging them to participate in continuousbuying. Contests associated with Coca Cola’s involvement insponsoring games, for instance, competition for tickets by purchasingthe company’s products, are highly recommended for use to guaranteethe attainment of the marketing objectives (Pendergrast,2013).
Concerningpersonal selling, Huang& Sarigöllü (2014) argued that acompany’s sales force presents its products in the market toincrease sales volume and establish consumer relations. The salesteam should communicate with the existing channels of distributionfor Coca Cola products. The business presently supplies coolerfridges and vending machines to various society centers, sportsgrounds, and shops. As a result of the recent failure of Coca Cola inthe areas of Coke Zero and Desani, the company requires moreincentives, such as the provision of free sports tickets, toguarantee success in personal selling (Pomeranzet al., 2013).
Finally,public relations entail establishing productive associations with thebusiness’ publics through effective corporate image and solvingunfavorable stories about the firm (Akgünet al., 2014).Coca Cola can invest more on press release to address the issue ofobesity linked to its high caloric products. It can advertise therelease of Diet Coke to offset the problem and build its brand imageamong the public and confirm that the company is socially responsible(Pomeranzet al., 2013).Although it takes some time to regain the trust of the consumers,such actions bear results in the long-term, and are necessary for theachievement of the projected marketing objectives of the company.
Aspart of the marketing mix, place signifies the means of availing theproduct in the market through distribution. Product distributioncommences with the manufacturer and terminates with the consumer(Wood,2013).A major consideration is the channel utilized by Coca Cola todistribute its products the company transports and sells itsproducts. The selection of a suitable distribution channel isnecessary as that dictates the volume of sales and product pricing.The factors to consider in choosing a distribution channel are thecustomers’ locality, nature of product, time the product isrequired, and transportation costs (Akgünet al., 2014).The four types of distribution strategies considered by Coca Cola aredirect, selective, intensive, and exclusive distribution. Given thatCoca Cola products are present in every outlet (supermarkets, servicestations, local shops), the company must be using the intensivedistribution method as it can supply the many target markets promptly(Nganga,2014).
Implementationand Additional Considerations
Implementationentails transforming plans into actions. The process comprises of allthe operations that oversee the working of the marketing plan.Effective implementation requires that the business properly blendits human resources, organization culture, as well as the firmstructure, into a consistent unit which maintains the marketing plan.In addition, Coca Cola must initiate several core modifications. Themarket segments should be motivated and informed about the companyproducts. The modes of promotion like advertisement should attractand entice the potential customers to achieve maximum productexposure, thereby ascertaining product success in the stores. Productdistribution must be effective the challenge has already beenaddressed through the introduction of convenient routes to thebusiness areas, and transport is always planned by the company andits distributing partners.
Otherimportant considerations are monitoring and control, need forresearch, and financial forecasts. Monitoring and control requiresCoca Cola Company to execute sales analysis and market shareanalysis. Sales analysis breaks down sales outcomes per marketsegment to recognize the weaknesses and strengths in the varioussales portions and act accordingly. Conversely, market share analysiscompares the sales performance of Coca Cola to the rivals toascertain if the company has attained its planed market shareobjective of 60 percent. Finally, Coca Cola should invest incontinuous market research to understand the cultural and behavioralchanges among its consumers and respond through brand innovation andproper marketing communication. Above all, the company must alsopartake financial forecasting to determine the costs related toresearch, development of products, product promotion, distribution,and product prices as the market environment shapes under the effectsof internal and external factors.
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