Coca Cola Brand Extension: Marketing Report and Analysis

This report provides an executive summary of Coca-Cola's brand extension strategy, focusing on the introduction of a new product, specifically a smoothie, under the existing brand. The study employs secondary research to analyze market trends and consumer behavior. The report identifies the target market based on behavioral segmentation using the STP model (Segmentation, Targeting, Positioning), highlighting the competition from existing products like KFC smoothies. The methodology includes the application of Kapferer's brand identity prism to build the brand identity. The analysis covers political, economic, social, technological, legal, and environmental factors (PESTLE) to identify market opportunities. The conclusion emphasizes the importance of effective marketing for the success of the brand extension and the competitive landscape. The report also includes figures on market share and relevant references.

Principles of
Marketing
1

Executive summary
This report has been described about brand extension of Coca Cola. A new product is
been developed under similar brand name. Moreover, the method used to conduct study is
secondary one. The data and info is gathered by doing secondary research. Furthermore,
results are been explained that target market is identified on basis of behaviour. The diet
coke has to face competition from Diet pepsi.
2

Table of Contents
Executive summary.........................................................................................................................2
INTRODUCTION...........................................................................................................................4
METHODOLOGY..........................................................................................................................4
FINDINGS.......................................................................................................................................4
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7
3

INTRODUCTION
In such a complex business environment, it is necessary for companies to introduce new
products and services in the market. It is done through brand extension. Coca Cola is a brand that
operate at global level. It was founded in 1886 by John Stith Pemberton. It is headquartered in
US. It provides variety of products and services to people. The products included coke on basis
of flavour, calories, etc. its market share is 48.6% of global beverage market. Also, market value
of company is $230.6 million in 2019. In recent times, there are many trends in sales. Now,
brand is focusing on variants of coke.
Figure 1 Coca cola market share
(source: Statista research development, 2019)
4

Figure 2 Coca cola market share
(Source: Coca Cola market cap, 2019)
METHODOLOGY
Here, in order to conduct study, secondary research was done. In that data and information
was gathered from previous articles, journals, etc.
FINDINGS
From research it is analysed that brand is a type of product that is manufactured by company
under its brand name. Brand extension is concept of marketing a product through brand image
and selling its products under different category. Branding is way of marketing to create a
distinct identity, name, symbol, etc. of company through which people are easily able to
distinguish it from competitors. Here, Kapferer prism is applied which enable in building a brand
and creating identity. In this there are 6 factors included:
Brand physique- it is brand physical qualities and specifications. Also, it includes product
features.
5

Brand personality- it shows the way in which product or service reflect what kind of person
Brand culture – it reflects the ethics and values that brand shows. Moreover, what type of
population or culture does brand target.
Relationship – this factor depicts relationship that allow people to engage with brand.
Reflection- it is related to views and perception of people towards brand. A strong reflection of
people will allow buyer to recognise it.
Self image - As stated self image is reflection of target customer. It reflects their internal
feelings and thoughts.
Target market
Coca Cola must specify its target market for smoothies. This is because it allows in
determining their needs and developing marketing strategies. In order to identify target market
STP model is used. :-
Segmentation – Here, segmentation refers to dividing population on basis of factors that are
demographic, geographic, behavioural, etc. thus, it will be done on basis of behavioural basis.
Targeting – the target audience is identified on basis of segmentation. Here, target people will
be those who want to drink something sweet. This include people of all age, gender, etc.
Positioning – in this it is find out that where services will be placed. So, Coca Cola will position
their product and services by offering discounts, coupons, etc. to customers. The services will be
based on low selling price.
It is evaluated that there are certain factors that results in emerging of new market.
besides that, new trends can be evolved as well. Thus, through pestle analysis and Ansoff matrix
new market is identified.
Political – due to change in FDA laws, it may allow company to develop new product.
Economic- With shift in economic growth of countries or in income level of people, the
company can introduce new variants at low price.
Social- It is related to change in taste and preference of people. So, they might prefer to drink
coke which is sugar free.
Technological- Any change in technology can impact of business operation of Coca Cola. they
need to keep pace with technology in producing diet coke.
Legal- they are related to employment, health and safety laws, etc. thus, they have to adhere all
laws and regulations.
6

Environment- The company needs to protect environment and contribute in CSR. As Coca Cola
uses high amount of water, so any change in law can affect their operations. So, by producing
diet coke water usage can be decreased.
By analysing the data, it is identified that company is opting for product development
strategy. They will produce new product and offer in it existing market. So, this strategy is been
adopted by them. The new product developed by them is smoothies. It will be a new product in
the market. Besides, natural flavour smoothies are produced and offered to people. Thus, the
variant will be sold under brand name of smoothies. The brand will be similar that is Coca Cola.
However, there is a competition which new product can face in the market. It is from KFC
smoothies,
Smoothies KFC smoothies
This is under the brand name Coca Cola. It is sold under brand name KFC
There is no existence of market share. There is high market share of KFC smoothies
CONCLUSION
It is concluded that diet coke is brand extension that Coca Cola want to introduce. This will
allow them to attract more people as product is new. The success of product will be determined
on its marketing. It will have to face stiff competition from KFC smoothies.
7

REFERENCES
Books and journals
Alserhan, B.A., 2017. The principles of Islamic marketing. Routledge.
Laczniak, G.R. and Murphy, P.E., 2019. The role of normative marketing ethics. Journal of
Business Research, 95, pp.401-407.
Lewnes, A. and Keller, K.L., 2019. 10 Principles of Modern Marketing. MIT Sloan Management
Review, 60(3), pp.1-10.
Morden, T., 2016. Principles of strategic management. Routledge.
Serrat, O., 2017. The future of social marketing. In Knowledge solutions (pp. 119-128). Springer,
Singapore.
Online
Kapferer brand identity prism, 2016. [online] Available through : <
https://marketinglessons.in/kapferer-brand-identity-prism-concept-example/>
8