Coca-Cola's Internationalization Strategy: A Case Study of Marketing Mix and Uppsala Model

This paper examines Coca-Cola's internationalization strategy, focusing on its marketing mix and the Uppsala model. The analysis explores how Coca-Cola adapts its product, price, place, promotion, people, physical evidence, and process to cater to diverse international markets. The paper also investigates how Coca-Cola's internationalization process aligns with the Uppsala model, using China and Malaysia as case studies. The study concludes that Coca-Cola's success in international markets is attributed to its effective marketing mix and its strategic application of the Uppsala model.

ASSIGNMENT 2
1

Table of Contents
INTRODUCTION...............................................................................................................................3
1. MARKETING MIX OF COCA COLA FOR THE INTERNATIONAL MARKETS................................4
2. INTERNATIONALIZATION PROCESS THEORY OF THE COCA-COLA.........................................8
CONCLUSION.................................................................................................................................10
REFERENCES...................................................................................................................................11
2

INTRODUCTION
This assignment focuses on the internationalization process and method adopted by the coca
cola. The various theory has been adopted by the company which focuses on the various
international activities (Armstrong, at al. 2015). Internationalization is the procedure which
increases the enterprises involved in the global markets. Coca-cola is the carbonated soft drink
company which has been originated in 1886, 8 May. It has been introduced by the John
Pemberton. The marketing tactics of the coca cola are very dominating in the soft drink market
of the Coca-cola. The formula of the coca cola drink has been kept a secret. Coca-cola has
adopted various strategies for expansion and diversification in the international market.
3

1. MARKETING MIX OF COCA COLA FOR THE
INTERNATIONAL MARKETS
Coca-cola has the highest and good equity of the brand. The marketing mix of the coca cola
is also changing with the time as the company is focusing on the marketing strategy for the
expansion in the different markets. Following are the marketing mix of the coca cola
(Greenfield, 2016):
Product: The coca cola has the broad portfolio in the beverage and soft drink industry with
over 3300 products. The product of the company has been categorized into various ranges
like fruit drinks, fruit juices, coffee, tea, energy drinks etc. Coca-cola is being considered as
the top brand in the juice, beverages and packaged water. Coca-cola has the market
presence in more than 200 countries (Greenfield, 2016). For example, the brands of the
coca cola in India are Maaza, Fanta, Limca, Thumps up, Nimbu fresh, sprite, iced tea etc.
Coca-cola distributes and produces some of the popular brands of beverages in the world.
The wide range of its products and brands of Coca-Cola in Australia are Coke zero, sprite,
Coca-Coca life etc. Also, the ranges start from the energy drinks, sports drinks, sparkling
waters and ready to drink teas. It has also proposed the Coke Zero in the market of
Australia. Coco cola carbonated brands that are offered in the market of the Philippines, It
has founded the brand as the Coca-Cola Bottlers Philippines Inc. in 1981 and it offers the
products like a soft drink in its markets (Greenfield, 2016).
Price: The pricing of the coca cola is being done according to the geographic market and
segment and they offer various varieties of products. There is a different pricing strategy of
coca cola for each sub-brand. The market of the coke is the oligopoly market where there
are few sellers and few buyers. Thus they form a contract of the cartel for ensuring the
mutual balance of pricing among the sellers. The market of India is a kind of sensitive
market so it uses the psychological pricing for the Indian market. Similarly, Coca uses the
promotional pricing strategy and segmented pricing strategy for the market of the Australia
4

and Philippines such as they provide different packages for the different customer audience
like PET- Plastic bottles, CAN- Aluminum Cans(Tins) etc. (Gertner and Rifkin, 2018).
Place: Coca-cola is the most favourite and popular brand in the world and it is available
across the world. Coca-cola follows the distribution system based on the FMCG. Coke has
the effective network of the distribution which has covered the middle and small level
players in the world market (Gertner and Rifkin, 2018). For example, Coca-cola has covered
the rural markets with the help of the using extensive distribution and also worn the market
share of Kalimark, Bovonto etc. Coca-cola has its market all over the world and produces
the wide range of its products globally. The place of the Coca-cola has been divided into
different markets according to the segments which are emerging markets, developing
markets and established markets. Coca-cola market is very huge and it has the strong
portfolio which represents more than 20 per cent of the sales volume in each country.
Austria, Greece, Cyprus and Italy etc. are in the established markets while Latvia, Poland,
Estonia etc. comes under the developing markets. Whereas the emerging markets of the
Coca-cola are Bulgaria, Moldova, Nigeria, Romania etc (Gillespie and Riddle, 2015).
Promotions: Coca-cola has adopted the various promotional strategies and advertising
campaign for creating the demand in the market of the world by linking with behaviour and
lifestyle and also targeting the value-based advertising. Coca-cola uses the coke ad for the
particular festival with the message in the different markets. In India, Coca-cola uses the
advertising campaign for the promotional in the Indian market (Andrews and Shimp, 2017).
And It has also many ambassadors for their brands like Hrithik Roshan, Shahrukh Khan etc,
For Philippines market, it has offered different allowances an price discounts to the retailers
and distributors for pushing the more products in the market. Also for the Australian
market, it uses the push strategy with the help of the promotion and pulls strategy through
campaigns and advertisements (Steenkamp, 2017).
5

People: People are the important elements of the marketing mix. It defines a service. This
depicts the people and individual who are in the direct connection with the consumers and
customers such as staff. It is one of the important parts for selling a product and lot of
customers relies on the good service for buying a product or service. The Coca Cola's
employees have a standard and good uniform. The Coca-cola aims at the quick service and
friendly atmosphere from their staff to its customers. The employees are full time and part-
time workers. In the Indian market, the stakeholders of the Coca-cola are recruited
according to their skills. While in Australia and Philippines they have different policies for
treating their employees. They have framed policies for the welfare of their employees and
also for the customers (Raja and Kumar, 2014).
Physical evidence: It is the important part in which the customers are the base for the
decision which is the based on the decisions. It is the surrounding and the environment
where there is the delivery of the service and the firm direct contact and interacts with the
customers and the tangible products are sold for the communication and performance of
the service. The physical evidence of the companies is recognized by the symbols, signs of
the business (Raja and Kumar, 2014). The Coca-Cola has the signage in the Coca-Cola and it
measures through their branding. Coca-Cola has the same symbol and sign of their brans all
over the world. They don't use any different strategy for the different markets. In India,
Australia and the Philippines etc. all have the same strategy for the physical evidence
(Zucchella, et al. 2016).
Process: The process of the product is the important part of the marketing which
determines the production capability for fulfilling the consumer's demands. The Coca-cola
company process is hidden and transparent as the whole process of the Coca-cola is not
visible to its customers. The coca cola has the various number of the process for the India
that is the labelling solutions and bottling. The main and significant stage that has been
considering by the Coca-Cola is the company's control over getting the products at the
6

agreed quality and time. The last step they use is the beverages selling for its target
customers through the distributors (Bergman and Lackland, 2018).
Thus it can be said that the Coca-cola uses the marketing mix strategy in the different
markets for the diversification and expansion of its markets. Coca-cola focuses on the target
market and it considers their market as the physiographic and demographic segments. This
shows that the marketing mix is very important for the company for creating the marketing
mixed strategy. Coca-cola also considers the importance of implementing the marketing
strategy.
Coca-cola develops the service or the product for meeting the needs and wants of the
customers. They also focus on the determining the way their consumers receive their
product and company also consider the indirect or direct distribution channel. The company
also decides the product pricing for ensuring the profit. At last, they promote its products
by use of the different methods of advertising for attracting customers.
7

2. INTERNATIONALIZATION PROCESS THEORY OF THE
COCA-COLA
Internationalization aims at the opportunities and core competencies in the foreign
surrounding and environment. It helps in achieving the volume effects with the increase in
quantity by using the potentials of foreign sales.
Internationalism process theory is also well known as the Uppsala model and stage model.
It considers as the process of integration, acquisition and use of skills and knowledge on the
international market. This model focuses to enter into the nearby markets with low market
commitment. Coca-cola has adopted the Uppsala model of Internationalization process
theory (Kenya, 2015). This model best describes the internationalization process theory of
Coca-cola. And the example of the adoption of Uppsala model can be seen in the market of
the China which has been described as follows:
The best internationalization process adopted by the coca cola is its internationalization
process in China. This theory depicts the entry modes which transfers from the franchising
to joint ventures with the local partners and it may be the combination of the franchising
and JVs (Tian, 2016).
China has the highest population and increasing growth rate of GDP and the country has
also the good potential for the Coca-cola. Coca-cola has the different market entry modes
over the different operations stages which are as follows (Marchet, et al. 2016):
 At the first stage which was in between 1979-1984, Coca-cola has sold the
concentrate to its franchisee which is based in the china. The agents of the local
market were responsible for the distribution and production.
 The second stage was in between 1985-1992, Coca-cola has purchased the equity
shares in the business of the bottling for reducing the uncertainty effect and
restricting the opportunistic aspects or behaviour of Coca-colas local partners
(Chebbi, et al. 2017).
 The third stage (1993- present)- Coca-cola has done a partnership with two bottlers
of foreigners named Swire group and the Kerry Group by doing agreement of
franchise (Miglietta, et al. 2017).
8

The Coca-cola has expanded its business in China very vastly, it has established more 18
new Joint ventures. The share of Coca-cola was become 40 per cent in 2000 in the
market of the soft drink of China while the Pepsi- cola was having only 15 per cent
market share, one of its competitors. In 2012 the market share of Coca-cola was 16.6
per cent in 2015 and 2017 Coca-cola has invested nearly $4 billion for building new
plants. Thus, it can be said that the Coca-Cola has adopted the model of Uppsala for
understanding its internationalization process (Wach, 2015).
The other example of the Uppsala model can be seen for the entrance of Coca-cola in the
market of Malaysia. Initially, the brand was not available in the market of Malaysia but with
the passage of time, the company has started its operations in the market of Malaysia. Coca-
cola has followed the subsidiaries and direct selling has been started by the agents that are
engaged in providing the products to the market of Malaysia. Coca-cola has established the
plan of shared ownership and Malaysian investors started invested the 15% of the plan
investment. Operations of the plant have started its operations in 2010 June (Johanson, and
Mattsson, 2015).
9

CONCLUSION
From the above report, it can be concluded that the Coca-Cola is using the different marketing
strategy for the expansion and diversification of the products and services. Coca-cola is using
the marketing mix in different markets for enhancing the base of the service and products. The
reason for their success and have the position of the global brand is their different strategy.
Coca-cola also focuses on the internationalization process theory for the expansion and
diversification in the different markets and also entering into the new markets so that it can
create its presence all over the world. That will enhance the profit and sales of the company
and also help to attract the more customers and consumers.
10

REFERENCES
1. Andrews, J.C. and Shimp, T.A., 2017. Advertising, promotion, and other aspects of
integrated marketing communications. Nelson Education.
2. Armstrong, G., Kotler, P., Harker, M. and Brennan, R., 2015. Marketing: an introduction.
Pearson Education.
3. Bergman, s. and Oakland, h., 2018. the influence of leadership behaviours in the
internationalisation process of MNCs.
4. Chebbi, H., Yahiaoui, D. and Thrassou, A., 2017. Multi-country collaborative innovation
in the internationalisation process. International Marketing Review, 34(1), pp.109-137.
5. Gertner, D. and Rifkin, L., 2018. Coca‐Cola and the Fight against the Global Obesity
Epidemic. Thunderbird International Business Review, 60(2), pp.161-173.
6. Gillespie, K. and Riddle, L., 2015. Global marketing. Routledge.
7. Greenfield, S., 2016. Giving the Global High Sign: Coca-Cola Advertising of the “American
Way” in Life Magazine, 1941-1947.
8. Johanson, J. and Mattsson, L.G., 2015. Internationalisation in industrial systems—a
network approach. In Knowledge, Networks and Power (pp. 111-132). Palgrave
Macmillan, London.
9. KENYA, O.A.B.B.I., 2015. ENTRY STRATEGY IN A FOREIGN MARKET AND PERFORMANCE
(Doctoral dissertation, SCHOOL OF BUSINESS, UNIVERSITY OF NAIROBI).
10. Marchet, G., Melacini, M., Perotti, S. and Tapia, E., 2016. Shaping the international
logistics strategy in the internationalisation process. International Journal of Supply
Chain and Operations Resilience, 2(1), pp.72-93.
11. Miglietta, N., Battisti, E. and Campanella, F., 2017. Value maximization and open
innovation in food and beverage industry: evidence from US market. British Food
Journal, 119(11), pp.2477-2492.
12. Raja, R.V. and Kumar, A., 2014. The impact of harmful ingredients over the consumers in
reference with coke and Pepsi. ZENITH International Journal of Multidisciplinary
Research, 4(6), pp.147-162.
11

13. Steenkamp, J.B., 2017. Global Marketing Mix Decisions: Global Integration, Not
Standardization. In Global Brand Strategy (pp. 75-109). Palgrave Macmillan, London.
14. Tian, X., 2016. Managing international business in China. Cambridge University Press.
15. Wach, K., 2015. Entrepreneurial orientation and business internationalisation process:
The theoretical foundations of international entrepreneurship. Entrepreneurial Business
and Economics Review, 3(2), pp.9-24.
16. Zucchella, A., Hagen, B., Denicolai, S. and Masucci, M., 2016. Early and accelerated
internationalisation: the role of the niche strategy in a new generation of exporters.
International Journal of Export Marketing, 1(1), pp.27-47.
12