Strategic Positioning of Coca-Cola: A Competitive Analysis Report

This report provides a strategic analysis of Coca-Cola, focusing on its market positioning and competitive strategies. It begins with an introduction to strategic management and its application to Coca-Cola, followed by an overview of the company's background and its flagship product, Coke. The report then presents a strategic positioning map illustrating Coke's competitive landscape and analyzes its cost leadership strategy. The rationale for this strategic choice is discussed, supported by a literature review examining the concept of cost leadership. Key strategic performance success factors, such as high profit, competitive advantage, and expense reduction, are identified and evaluated. The report concludes with recommendations for Coca-Cola, emphasizing the importance of debt management and adapting to changing consumer preferences, and highlights the benefits of its cost leadership strategy.

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Contents
Introduction................................................................................................................................2
Background of the product.........................................................................................................2
Strategic Positioning Map in competitors..................................................................................3
Rationale for the choice of strategy...........................................................................................4
Literature Review.......................................................................................................................5
Strategic performance success factors.......................................................................................6
Recommendation........................................................................................................................7
References..................................................................................................................................9

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Introduction
Strategic management is the process of analysing, monitoring, and assessment of business
environment of the organisation. The process of analysing and monitoring the environment
helps to achieve the goals and objective of the company. It is essential for the organisation to
develop the effective strategy in order to achieve the objective. There are many strategic tools
that are used to analyse the business environment in order to develop the effective strategies
for the companies (Ansoff, Kipley, Lewis, Helm-Stevens, and Ansoff, 2018). The strategic
management helps the organisation to develop a new strategy by analysing the business
environment. Strategic positioning map is the map which states the position of the company
in the industry and the market among its competitors (Wheelen, Hunger, Hoffman, and
Bamford, 2017). In this report, the discussion is made on the topic of strategic position plan
of a product to analyse its strategy to attain the success in the market. In this report, COKE
product has been taken into consideration in order to analyse the strategy of the company to
expand the business.
In the beginning of the report, the strategic position of the product will be discussed in the
competitors. After that, the discussion is made on the strategic position of the product in
order to evaluate its position in the market.
Background of the product
Coca-Cola Company is a multinational corporation company in America. It delivers the soft
drinks with the strong distribution channel to large number of consumers. The company is
best known for its flagship product and that is Coke (Coca-Cola, 2016a). Coke is a
carbonated drink manufacturing company which is produced by the Coca-Cola Company.
The name of product is given as per its main ingredients and these are Coca leaves and Kola

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nuts (caffeine). The taste of product is preferred by the large number of people. The formula
and ingredients to develop Coca-Cola remains a trade secret for the market. The taste of
product becomes the first preference of the consumers in the market for drinks. The company
also produce other drinks under the name of Coke (Coca-Cola, 2016b).
Strategic Positioning Map in competitors
Strategic position map describe the position of the company in the market and the strategies
from which they expand its business at the international level. It helps the company to
develop a market positioning strategy for their product (Whitney,and Gale, 2015). The
strategic position map of competitors describes the position of the company in its
competitors. Coke has many competitors in the market who compete the product in terms of
taste and quality of drinks. The competitors of Coca-Cola Company produce the soft drinks
to compete the company by providing the product to large number of consumers.
The strategic positioning map of the Coke is developed with its competitors:
High Cost
Low
Quality
High Quality
Low Cost
Coke
Pepsi
Co.
Red
Bull

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The above map states that strategic position of the company in its competitors. The strategic
position of Coke states that the product has high quality and high cost (Madsen, and Walker,
2015). The strategic positioning map of the product helps to differentiate the product from its
competitors in the market. Coke product has many competitors in the market that provide the
similar product to consumer with the different strategies in order to attract the large number
of consumers towards their soft drinks. It has been seen that the competitors of Coke also
adopt the similar strategies while developing the product in order to deliver the services to
consumer such as Red Bull. Red Bull is also a soft drink that provides the services to
consumer in high quality and high cost in order to develop the buzz in the market for the
product. The other competitor of Coke is Pepsico. that provides the services to consumer with
the strategy of low quality and high cost (Bhasin, 2019). It is observed that the Coke have
different strategy and it helps to attract the consumers towards its product. The company
provide the Coke with the high quality but with the moderate cost that becomes it different to
its competitors. Thus, it can be said that the company adopts the cost leadership strategy in
order to provide the services to the large number of consumers. This strategy helps the
company to differentiate it from its competitors and develop the unique image in the market
(Block, Kohn, Miller, and Ullrich, 2015).
Rationale for the choice of strategy
As per the analysis, it is observed that the strategic positioning strategy of the product is cost
leadership strategy. Cost leadership strategy defines the method in which the company reduce
its cost as compare to its competitors and provide the high quality of services to consumer. In
the modern business environment, the competition is increases among the companies.
Strategy implemented by the company in order to reduce its production cost and sell it with
the higher rate (Hill, 2017). The company can gain the competitive advantage as the

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consumers always prefer to buy the product which has moderate cost and high quality. This
strategy also helps to attract the large number of consumer as the company offers the product
in the low prices from its competitors. The company gains the competitive advantage from
this strategy in the market. As there is a high competition in the market due to which this
strategy is considered as the beneficial fact for the company. These are the reasons due to
which the company is selected this strategy to develop the unique image in the market.
Literature Review
Different authors define the strategy in their own way in terms of competitive advantage. In
this section, the cost leadership strategy is defined as per the different authors. Cost
leadership strategy is one of porter’s generic strategies that an organisation could implement
to gain the competitive advantage over the competitors in the market. As per the opinion of
Porter,and Heppelmann, 2017, Cost leadership strategy defines the low cost of selling the
product to consumers in order to make it different from the others. As per the author, the
company has to provide the services and product to consumer with the unique features and
high quality in the low prices. The company reduces the cost of operation in order to offering
the high cost to consumers. According to the author, the main aim of this strategy is to exploit
scale of production by using the advance technology so that the cost of production will
reduces and the high quality of product is produces. As per the author, Coca-Cola has to
adopt the advance technology to reduce the cost of production of soft drink.
According to the Salavou, 2015, the control function of debt is more essential for the
companies that strive to be efficient. It means the controlling the debt helps to reduces the
cost of production of the product due to which the company can easily deliver the services in
low cost. It is required to fulfil all the obligations of the company so that it can produce the
product in the low prices. Controlling the debt is a source due to which the company reduces

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its cost of production. As the company borrow the less amount of money due to which the
cash in hand is less. The less amount of money in hand states the position in which the
company has to produce then product in the less prices. As per the author opinion, it is
observed that the Coca-Cola Company control its debts and invest the large amount in the
new assets in order to attain the high success in the market. The competitor of the company
such as Red Bull offers the drink in high price as it borrow the large amount of money from
the financial institutions and the other sources.
Strategic performance success factors
As per the analysis, it is observed that there are various strategic performance success factors
that help to attain the success in the market and these are given below:
High Profit
It is observed that the company gain the high profit while implementing the cost leadership
strategy. Cost leadership strategy defines the low cost due to which the large number of
consumers attracted towards the services. It is a fact that the consumers always prefer the low
prices with the high quality of product. The demand of consumer is increases due to which
the company has to supply the product in the market with the strong distribution channel. The
large number of sale helps to increases the profit of the company as the large sale means the
large revenue gain by the company. It considered as the best technique to earn the high
revenue by the company (Panwar, Nybakk, Hansen, and Pinkse, 2016).
Competitors
It has been seen that there are large number of competitors in the market who deliver the
beverages services to consumers. There are many companies who produce the similar taste of
soft drinks to attract the consumers towards the company such as PepsiCo. It is observed that

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the PepsiCo. is the company who provides the similar nature of drink in the market with the
low quality and cost. The other competitor of the company provides the services with the
high quality and cost such as Red Bull. But as per the analysis, it has been founded that the
cost leadership strategy helps the company to gain the competitive advantage. The low cost
with the high quality product can easily afford by the consumers due to which it can be said it
helps the Coca-Cola to beat its competitors in the market (Noe, Hollenbeck, Gerhart, and
Wright, 2017).
Reducing expenses
The expenses of the company is reduces by applying the cost leadership strategy. It has been
seen that the cost of production is reduces while implementing the strategy. It is a key success
factor for the company that the expense will control by implementing the strategy. Reducing
and expense is a success factor because it protects the company to suffer with the loss (Lloret,
2016).
Recommendation
At the end, it is concluded that the Coca-Cola Company have its different image in the
market. In this report, the strategic positioning map states the position of the company among
its competitors in the market. It states that the company is in the position where it sells the
product with the high quality in the moderate cost. As per the analysis, it is observed that the
company adopt the cost leadership strategy in order to provide the services to consumers in
low prices. This strategy has many benefits due to which the company achieve the high
success in the market. The key success factor of this strategy is high profit, beating the
competitors, and reducing the expenses. It is recommended that the company has to control
its debt so that it can survive for long time with this strategy otherwise it can face the
challenges due to low cost. It is also recommended that the company has to develop the taste

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of drink as per the demand of consumers as the demand of consumers is fluctuated day by
day toward the healthy drinks. The cost leadership strategy of the company develops the
unique image in the market.

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References
Ansoff, H.I., Kipley, D., Lewis, A.O., Helm-Stevens, R. and Ansoff, R. (2018) Implanting
strategic management. Springer.
Bhasin, H. (2019) 11 Top Coca cola competitors – Competitor analysis of Coca cola.
[online] Available from: https://www.marketing91.com/coca-cola-competitors/ [Accessed
26/05/19].
Block, J.H., Kohn, K., Miller, D. and Ullrich, K. (2015) Necessity entrepreneurship and
competitive strategy. Small Business Economics, 44(1), pp.37-54.
Coca-Cola (2016a) About Coca-Cola Journey [Online]. Available from: https://www.coca-
colacompany.com/our-company/about-coca-cola-journey [Accessed 26/05/19].
Coca-Cola (2019b) Our Products [Online]. Available from: https://www.coca-
colaproductfacts.com/en/products/ [Accessed 26/05/19].
Hill, T. (2017) Manufacturing strategy: the strategic management of the manufacturing
function. Macmillan International Higher Education.
Lloret, A. (2016) Modeling corporate sustainability strategy. Journal of Business Research,
69(2), pp.418-425.
Madsen, T.L. and Walker, G. (2015) Modern competitive strategy. McGraw Hill.
Noe, R.A., Hollenbeck, J.R., Gerhart, B. and Wright, P.M. (2017) Human resource
management: Gaining a competitive advantage. New York, NY: McGraw-Hill Education.
Panwar, R., Nybakk, E., Hansen, E. and Pinkse, J. (2016) The effect of small firms'
competitive strategies on their community and environmental engagement. Journal of
Cleaner Production, 129, pp.578-585.

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Porter, M.E. and Heppelmann, J.E. (2017) Why every organization needs an augmented
reality strategy. Harvard Business Review, 95(6), pp.46-57.
Salavou, H.E. (2015) Competitive strategies and their shift to the future. European Business
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