PESTLE And SWOT Analysis of The Coca Cola Company

The Coca Cola Company: Marketing
Strategy

Contents
Introduction and Summary of the Company ............................................................................................ 3
Environmental Analysis ........................................................................................................................... 3
Political ............................................................................................................................................... 4
Economic............................................................................................................................................. 4
Social................................................................................................................................................... 4
Technological ...................................................................................................................................... 5
Customer analysis – STP analysis ............................................................................................................. 5
Segmentation ...................................................................................................................................... 6
Targeting ............................................................................................................................................. 6
Positioning .......................................................................................................................................... 7
Competitive Analysis ............................................................................................................................... 7
SWOT Analysis..................................................................................................................................... 7
Strengths ......................................................................................................................................... 7
Weaknesses..................................................................................................................................... 8
Opportunities .................................................................................................................................. 8
Threats ............................................................................................................................................ 9
Porter’s Five Force Analysis ............................................................................................................... 10
Competition................................................................................................................................... 10
Threat of new Entrants .................................................................................................................. 10
Threat of substitute products......................................................................................................... 11
Supplier power .............................................................................................................................. 11
Buyer Power .................................................................................................................................. 11
Strategic approach and competitive advantages.................................................................................... 12
Channel analysis.................................................................................................................................... 13
Communication – Innovative advertising ........................................................................................... 13
Distribution ....................................................................................................................................... 14
Conclusion............................................................................................................................................. 15
References ............................................................................................................................................ 16

Introduction and Summary of the Company
Coca Cola is known as soft drink of the world (Bell, 2004). It was invest by Dr John Pemberton,
who was a pharmacist in Atlanta. The drink did not have bubbles at that time and started selling
at soda fountains. The first slogan for the new drink was “Delicious and refreshing”
The company has been hugely successful over the last century and has become an icon of
American culture. Coca Cola is not involved in all the processes that see its products go to the
hands of consumers. According to the company website, Coca Cola has entered into partnership
with bottlers around the world. The website says, “Our Company manufactures and sells
concentrates, beverage bases and syrups to bottling operations, owns the brands and is
responsible for consumer brand marketing initiatives. Our bottling partners manufacture,
package, merchandise and distribute the final branded beverages to our customers and vending
partners, who then sell our products to consumers.”
The company posted revenues of US$ 35 billion and net income of US$ 11.8 billion in 2010.
Total number of employees on payrolls of the company during the period was 139,600 and the
company sells its products in more than 200 countries (Form 10K: The Coca Cola Company,
2010).
This report looks at various marketing techniques used by Coca Cola to become one of the best
known brands of the world.
Environmental Analysis
PEST analysis is valuable while analyzing external environment where a business is conducted
or where an organization is planning to start a business (Henry, 2008). This section studies the
environmental factors that have an impact on operation of Coca Cola.

Political
Coca Cola is subjected to strict regulations since its products come under food category.
However, few changes in law are expected to impact Coca Cola. Following are some such
factors:
- The issue of negative impact of Coca Cola manufacturing plants on environment has
been highlighted in many countries. Laws for environment protection and stringent
regulations in this regard can impact the production process. Coca Cola can work towards
minimizing this impact by improving the efficiency of its processes and reducing
wastage.
- Government changes, civil unrest, military takeover and other disturbances in a country
can affect sales and operations of Coca Cola in that country.
- Expansion to a new country depends on the political conditions of the area. Coke
abstained from Israel for many years because it wanted to protect the Arab market, which
was quite large.
Economic
Following economic variables can impact Coca Cola
- Economic downturn in a country is going to have a negative impact on sales of Coca
Cola. The impact on the company would be specially huge since its products are non
essential.
- Various macroeconomic factors such as inflation and labor price would impact operations
of Coca Cola.
- Countries with high income per capita would have more to spend on products such as
beverages.
Social
The Coca Cola Company can be impacted by following social variables