Brand Extension Report: Analyzing Coca-Cola's Market and Strategy

This report provides a comprehensive analysis of Coca-Cola's brand extension strategy. It begins with an introduction to brand extension and contextualizes it within the Coca-Cola framework. The report explores different models for brand extension, with a focus on diversification. It suggests the deve...Read More

Brand Extension Report

Executive Summary
This report has discusses brand extension and different elements of brand extension.
Contextualising Coca-Cola report has discussed few models on the basis of which organisations
can extend their brand. For the purpose of brand extension diversification strategy and
development of chocolates was suggested in report.

Table of Contents
INTRODUCTION...........................................................................................................................4
Methodology....................................................................................................................................4
Findings...........................................................................................................................................4
Existing brand and Brand Values................................................................................................4
Description of the Target Market................................................................................................6
Analysis of the New Market, Including Trends...........................................................................6
An Explanation of the New Product............................................................................................7
Comparative Analysis..................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Brand extension can be defined as a process in which organisation utilise its existing
brand name for a new product and new product category. This report aims at discussing brand
extension of Coca-Cola. Coca-Cola is a American multinational beverage corporation. Company
was founded in 1892 and is headquartered at Georgia, US. Company offers several types of
drinks and operates different brands. Coca-cola has a market share of 42.5%, and concerned with
trends that coca-cola followed for its success is focusing on health aspects and Diet Coke is top
selling diet drink.
Methodology
In order to carry out secondary research was adopted and in order to make research
regarding different elements covered in this report, secondary sources were considered. Along
with this online sources were also used to make research. This is because Coca-Cola is a big
organisation and this is why sufficient information was available on online sources.
Findings
Existing brand and Brand Values
A brand can be defined as name that organisation give to its product and service. This
brand helps organisation in differentiating its product and service from its competitors. Brand
extension can be defined as use of existing brand name for a new product and new product
category. In order to understand branding Kapferer’s Brand Identity Prism can be utilised.

Figure 1 Kapferer’s Brand Identity Prism
This identity prism outlines six elements of brand identity that are discussed as-
Physique- This is concerned with physical characteristics of a brand and visual features that help
customers in identifying brand. In other words how does a brand appears is involved in this
(Ross, 2020).
Personality- This is concerned with how customers perceive brands
Culture- Culture element in this is set of values that feed into and become foundation for the
brand
Relationship- This is based on nature of relationship between brand and its consumers
Self-image- This involves how customers sees themselves in a particular brand
Reflection- This is different from self-image as reflection is concerned with how brand portray
its target audience

Description of the Target Market
Segmentation- This is concerned with differentiating customers groups on the basis of their
characteristics. These characteristics are demographic, behavioural, psychographic and
geographic characteristics that differentiate customers.
Targeting- For the purpose of new brand target market strategy adopted by Coca-Cola is
differentiated marketing strategy (Camilleri, 2018). In this company targets low and medium
income customers of different age and genders.
Positioning- Positioning strategy that Coca-Cola adopts for the purpose of positioning of new
brand in market is benefit positioning. In this company will position new brand on the basis of
benefits that it provides to customers.
Analysis of the New Market, Including Trends
Political- This involves varies regulations and standards of food safety that countries have
affecting Coco-Cola.
Economical- This involves economic conditions of countries and income of population.
However product targets low medium income customers and does not get affected by this.
However, it requires low cost for the operations of the company to ensure its capability to
provide products at low cost.
Social- This is concerned with customers and their preferences and concerned with new brand
Coca-Cola gets affected by increasing demand for healthy eating products.
Technological- Coca-Cola requires considering technology in operations and technology in
reaching target market customers.
Legal- This involves regulations like employment, operations and food safety and standards
affecting new brand of Coca-Cola.
Environmental- This involves impact of organisational activities on environment (Perera,
2017). Increasing environmental consciousness requires ensuring conformation to environmental
safety standards.
Ansoff Grid

Market penetration- This is concerned with increasing sale in existing market and using
existing products of the company using promotional strategy.
Product development- Product development is concerned with developing new product for
existing market customers.
Market development- This strategy involves developing new market for the existing products
of the company (Dawes, 2018).
Diversification- This is concerned with developing new market and new product. This strategy
highest risk similar to starting new venture.
An Explanation of the New Product
Tauber’s Brand Extension Options provide following options in which organisations can
extend their brands. Options are-
 Same product in different form
 Distinctive taste/ingredients/components
 Companion products
 Customer franchise
 Expertise
 Benefit/attribute/feature
 Designer or ethnic image
These are certain ooptions that has been provided by Tauber for the purpose of brand extension
that Coca-Cola can consider in its brand extension (Childs, 2017).
Comparative Analysis
For the purpose of brand extension Coca-Cola can develop new product that is chocolate.
This is because Coca-Cola offers several drinking products and its existing market size and share
is also very big for adopting market penetration strategy. Coca-Cola when develops chocolates it
is likely to have competition with Cadbury. Comparison of Coca-Cola with Cadbury-
Coca-Cola Cadbury
Coca-Cola is a market leader in drink offerings Cadbury is leader in its market and chocolate

offerings
Marketing strategy of Coca-Cola involves offering
different brands. This means that Coca-Coola
offers several products but they are known from
their own brand and brand image. Coca-Cola does
not involve its name in all products.
Cadbury offers products rather than brands
however, each product have their own identity and
image but customers can identify that certain
product is of Cadbury. Example of this is Cadbury
Dairy Milk, Cadbury 5-Star, Cadbury Eclairs and
many other products.
Products of Coca-Cola mainly targets young age
people like Coca-Cola drink.
In its targeting products of the company are offered
for people of all ages.
Coca-Cola can consider strategy of competitors while developing new products and offerings.
This means that it can target different people and attract customers from different segments of
market (Musa and et.al., 2016). Reason behind suggesting this strategy of diversification is that
Coca-Cola is a popular brand and customers in many countries are aware of Coca-Cola and in
such situation its existing brand image will help in success in new brand.
CONCLUSION
Discussion can be summarised as there are several ways a company can extend its brand.
This report considered Coca-Cola and well established company can select diversification for te
purpose of brand extension.

REFERENCES
Books and Journals
Camilleri, M.A., 2018. Market segmentation, targeting and positioning. In Travel marketing,
tourism economics and the airline product (pp. 69-83). Springer, Cham.
Childs, M., 2017. Brand extension feedback effects: What do we know and where should we
go?. Journal of Product & Brand Management.
Dawes, J., 2018. The Ansoff Matrix: A Legendary Tool, But with Two Logical Problems. But
with Two Logical Problems (February 27, 2018).
Musa, N and et.al., 2016. The Cadbury Controversy: Blessings in Disguise?. In Contemporary
issues and development in the global halal industry (pp. 95-104). Springer,
Singapore.
Perera, R., 2017. The PESTLE analysis. Nerdynaut.
Ross, F., 2020. A Perspective on the Application of Kapferer's Brand Identity Prism in the
Branding Process of Hearing Aid Retail Companies (No. jmmr249). Global Academy
of Training and Research (GATR) Enterprise.