Strategic Analysis of Coca-Cola: Planning and Development Report

This report provides a detailed strategic analysis of Coca-Cola, covering various aspects of its business operations and market position. The report begins by exploring the relationship between strategy and tactics, emphasizing the benefits of strategic planning for organizations and the role of stakeholders in developing organizational strategy. It then delves into a SWOT analysis of Coca-Cola, identifying its strengths, weaknesses, opportunities, and threats. A PEST analysis is also conducted, examining the political, economic, social-cultural, and technological factors influencing the company. The report further includes a product portfolio analysis using the BCG matrix to assess Coca-Cola's different product lines. The analysis highlights the company's strategic approach, competitive advantages, and challenges within the beverage industry. The report concludes by providing insights into Coca-Cola's strategic planning and development, offering valuable information for students studying business development and strategic management.

Strategic planning and
development

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Relation between strategy and tactics..........................................................................................3
Benefits of strategic planning to the organisation.......................................................................3
Role of stakeholders in developing organisational strategy........................................................4
TASK 2............................................................................................................................................5
SWOT of Coca Cola....................................................................................................................5
PEST of Coca Cola......................................................................................................................6
TASK 3..........................................................................................................................................10
Product portfolio analysis of Coca Cola BCG matrix of Coca Cola.........................................10
REFERENCES..............................................................................................................................12

TASK 1
Relation between strategy and tactics
Strategy is based upon extensive resorts, planning and internal reflection. On the other hand,
tactics is determined by managing best channels for the business and making the effective
messages for audience. Business have the opportunity for changing the strategies and adopting
external as well as internal factors within the company. Tactics can be changed on the basis of
success of strategy. Within organisation, strategy and tactics work together for achieving the
goals and objectives. There are various resources within companies which have to be utilised
properly in order to manage the project completion in proper manner. This is involved with long
term strategy and these are managed for completing day organisation goals by developing tactics
(Deffner and et. al., 2020). This can be explained with an example. Strategy is known as the way
by which a company is able to manage the functioning of the company in more easier manner.
On the other hand, tactics means the manner which is used by the company for increasing the
company's profits and sales. In other words it can be said that this will enhance the company's
opportunities. It is important for the organisation to minimise carbon footprint as the humans are
contributing to this type of work. The resources of organisations are managed properly in order
to complete the organisational strategies and objectives in proper manner.
Benefits of strategic planning to the organisation
There are various benefits of strategic planning to the company. Hence, it is very important for
different organisations to manage the strategic planning and working effectively in the business
environment. A strategic plan helps the organisation to manage the future development and work
effectively within the environment and achieve success. by using strategic planning, there are
various ways by which organisations can manage the work and analyse precautions for avoiding
these. By having a strong strategic plan, organisations are able to react in a proactive manner and
manage different business situations. If their organisations are working proactively, there able to
manage the marketing trends properly and have strong competitive advantage. A strategic plan is
helpful for the companies to define proper direction in which they must undergo for increasing
the mission and vision of the company (Lim, Jee and De Run, 2020). There are strategic plans
which of a different foundation in which organisations can grow, evaluate their success as well

as compensate the employees and establish effective decision making. Another profit that can be
adopted from strategic planning is that it provides a proper road map to the management for
aligning functional activities of organisation and managing the goals and objectives property.
There are also discussions and decision making regarding the management in which there is need
of determining resources and budgets properly for accomplishing the objectives and goals. By
using a strategic plan, it is easy for the organisations to get valuable insights regarding the trends
and opportunities within market for managing consumer segment and analysing the service and
products offered by the companies. there is need of maintaining a proper approach that can be
targeted for well strategist in order to maintain the marketing and sales property. By using the
strategic planning, business is able to develop durability and reliability within business
environment. As businesses are requiring to make profits and money for managing the success of
industry. It is very important for the companies to manage to strategic planning and align the
employees and staff for maintaining competitive advantage and developing profits. This provides
help in managing the functions properly and developing strategic efficiency. It is very essential
for the companies to manage the strategic plan management software that can be used for
managing be operating and strategic plans in effective manner and analysing the performance of
companies and having a proper track upon the business operations and activities.
The strategic growth of coca cola depends upon the process of decentralisation. This company
believes that it is known as the process in which this company is involved in distinguishing it's
services and products from the other competitors. Coca Cola believes in decentralised strategic
management process in which domestic corporation are provided the mandates are provided by
the parent company. Coca Cola uses this strategy and there are numerous foreign subsidiaries
which are basically costly and complex process.
Role of stakeholders in developing organisational strategy
There are various key stakeholders of the company which are important aspect of the business
organisations. the key stakeholders must be involved within strategic planning in order to
increase the success rate of organisation (Colapinto and et. al., 2020). There are various
stakeholders of companies including customers, employees, shareholders, owners, community
members, etc. Which are working effectively for managing the success of organisation. There is
requirement of external stakeholder opinion as well as insides for managing the valuable stages
of planning and analysing the business environment properly. Coca Cola increases the market

share and profit by managing the business activities and functions properly. Coca Cola focuses
upon engagement of stakeholders in the business decision making for managing the consistency
of running business successfully within market. Different key stakeholders are present of Coca
Cola which are analysed properly and the core purpose of the organisation is provided to them
in effective manner. Strategic plan is directly aligned to the decision-making of stakeholders as
Coca cola is doing well within market and making more profits, It is seen that it can be able to
make profits easily and maintain the organisational goals.
TASK 2
SWOT of Coca Cola
The swot analysis of company helps in analysing the strength and opportunities within the
company and how it can increase the market share and profits. SWOT analysis of coca cola will
help in managing the company in effective manner and controlling the different iconic brands
which are helpful in providing competitive advantage (Chernev, 2020). The SWOT analysis of
coca cola is listed below –
 Strength - Coca-Cola is one of the largest beverage providing company across the world.
This provides non alcoholic beverage across the world. According to the statistics, it
provides products 21.9 billion people that come across 4% of the the total beverage
serving companies worldwide. This company provides non alcoholic beverages in
approximately 200 countries. The biggest competitors of Coca-Cola are necessary and
Pepsico. As Coca-Cola is one of the largest beverage company and it has ability for
dominating market share over other competitors. as the size of coca cola market share is
large within market, it has opportunity to have more power over competitors and
suppliers. There are some small brands which provide good competition to Coca-Cola by
providing drinks at lower price. The range of audience for Coca-Cola is also wide. Coca-
Cola company distributes and owns 500 different brands which are most extensive
beverage brand portfolio in the whole beverage industry. The trademark of Coca-Cola on
approximately 40% of total revenue of the company.
 Weakness - Coca-Cola s having some weakness that become hurdle for the company e to
maintain the competitive advantage. These include aggressive competition with Pepsi.

The biggest rival of Coca-Cola is Pepsi which is the market leader in the beverage
industry since many years. Another weakness is product diversification. There is no
product diversification in coca cola. On the other hand, Pepsi is a company which has
launch different snack items to like lays and Kurkure. Also, Coca-Cola is not able to to
manage the the customer segment. Hence Pepsi has the power to take over Coca-Cola
market segment.
Opportunities - Coca-Cola has the opportunity for introducing new products and offerings in
health and food segment (Sousa and Magalhães, 2020). This can help in increasing revenue of
the company. As this company is offering cold drinks, it has the opportunity to reach the
developing Nations where the climate is hot and there is requirement of drinking cold beverages.
The best example can be Coca-Cola can expand its operations in African countries and middle
East countries. Domain management required in the beverage industry is proper logistics and
supply chain. There is need of bringing advancement in supply chain system so that Coca-Cola
can be able to operate the functions properly. There are several packaged drinking water brands
and Coca-Cola can also expand the market share by selling packaged drinking water.
 Threats - there are various challenges which Coca-Cola has faced within market. One of
the biggest challenge is because of the competitor Pepsico. There are other criticisms for
coca cola in which it was claimed for not providing proper water management issue.
there are several environmental and social groups that have provided information that
Coca-Cola conducts business operation and in the region where there is water scarcity, it
was polluting the water by mixing pesticides in it.
PEST of Coca Cola
Pest analysis is a framework which is used to describe the macro environmental or external
factors of an organisation which are used for environmental scanning in order to formulate a
proper strategic management plan. This is one of the part of external analysis conducted in an
organisation in order to continue with market research and also give an overview of all the macro
environmental factors which have an effect on activities and operations of a business. These
tools also help in analysing the decline or growth in the market, potential, business position as
well as direction for the operations (Golio, 2020). PEST analysis stands for political, economic,

social cultural and technological factors. Below mentioned is PEST analysis conducted on Coca-
Cola. Political factors: The major factor which has a direct impact on Coca-Cola are the laws
as well as regulations of government regarding food products. Like in United States the
Food and drug regulations apply to such businesses. It is also seen that these regulations
may vary from country to country. It is necessary for Coca-Cola to make sure that all of
its products are fulfilling all these laws of the countries where it is sold. Other than food
and beverages regulations there are a number of other regulations which they need to
follow such as quality standards, Taxation laws business accounting laws and various
other laws which differ from country to country. It is often seen that any changes in such
law may variably affect the profits of company. Also changes in the situation of politics
in a country like the change of government can all so impact the company.
Economic factors: there are a number of economic factors in an economy which have direct and
major impact on businesses of global companies which deal in international market. Any
financial crisis existing globally can variably affect the profits of business. However, company
may manage these changes in their organisation but still the profits of company gets affected due
to these economic changes up to some degree. It is often seen that in times of economic crisis
people switch to using only necessity products. It is required by companies to cut their cost and
reduce their cost so that they can bear the pressure of economic crisis (Osborne and et. al., 2020).
It is seen that global economic crisis can have major impact on international businesses. Also
rising prices of raw materials have great impact on profits of Coca Cola. There than this there are
major economic factors such as tax rates, foreign exchange rate, interest-rate and gross domestic
product of a nation which affect company. Sociocultural factors: social factors refer to changing behaviour and beliefs of people in
a region. It is often seen that people are turning towards more flavoured and healthy
drinks. Due to such trend there have been seen a decline in revenue of Coca-Cola. This
was a major social change brought in worldwide. There were also a number of media
covering Coca-Cola as a soft drink loaded with calories. Due to this company came up
with a number of low calories as well as 0 calorie soft drinks in order to adopt the
changes and perception in behaviour of customers. It is also necessary for Coca-Cola to
make sure that while adopting a marketing strategy they look towards the culture and

local markets so that brand awareness and promotion can be done effectively in different
parts of the world.
 Technological factors: Technology is a great factor which impacts every business in
today’s world. Coca-Cola have faced a number of problems due to its packaging and
production services. In order to make sure that they are well aware with all the
technological advancement brought in the market they make sure that they invest heavily
in various innovations of technology regarding their production, packaging, distribution.
All these factors heavily affect the revenues of company. Now all the products of Coca-
Cola are produced using heavy technologies. Technological factors can be seen to have
variable effect on business of Coca Cola.
From the above SWOT and Pest analysis, it is recommended that Coca-Cola is having
definite market position in the soda industry. Moreover, it is recommended that there is need of
bringing innovation with them Coca-Cola business operations. Some of the recommendations for
Coca-Cola are mentioned below –
 There is need for Coca-Cola to invest in new segment and especially in the food segment
and introduce new products.
 There must be some solution provided by this company in order to address rising health
concern within the society.
 Several products provided by Coca-Cola like Dasani, Fuze tea and Hi-Care not
introduced in several developing countries. It is recommended for the company to
increase the distribution of such products.
Porter’s five forces force analysis of Coca Cola
Porters five forces model is a strategic analysis tool which helps to analyses all the forces
of a market which impacts the competition in an industry. Below mentioned is the porters five
forces model is applicable for Coca-Cola:
Bargaining power of suppliers: Bargaining power of suppliers for Coca-Cola is weak. This
happens because there are a number of suppliers present in the market for Coca-Cola and also for
company to switch any supplier the cost is very low (Porter, 2020). Coca-Cola can easily change
their suppliers but the suppliers cannot get any other company like Coca-Cola easily. This can be
providing losses to the supplier of Coca Cola. However there is no substitute for a number of
products and raw materials required for production such as sugar but the number of suppliers

providing the raw materials are very high. Due to this the bargaining power for suppliers is very
low. Bargaining power of buyers: It is often seen that the bargaining power of customers for
Coca-Cola is low. Because the volumes in which customers buy this product is very
concentrated or small. However, there is very limited difference between Pepsi and Coca-
Cola. Still they sell a lot of similar flavours. Also, for customers to switch the brands cost
in walled is very low. But both of these companies enjoy customer loyalty up to
maximum level. It is often seen that the customers for Coca-Cola are not price sensitive.
Some of the retailers who buy the products of Coca-Cola in bulk have some bargaining
power existing with them. Still considering for whole market the bargaining power of
customers is low in case of Coca-Cola. Threat of new entrants: when taking into consideration the industry for beverages there
are a number of factors which discourage any new brands from entering in the market. It
is difficult for a new brand to grow overnight. There is a lot of investment required in
beverage industry. The operations as well as marketing require huge investment in a
beverage industry. However, there are some of the local brands which start their business
is at a smaller scale and still require a lot of investment for marketing communication of
their products as well as hiring skilled workforce for their company. It is also seen that
the existing brand have a set a loyal customer base for their products. Due to this it
becomes difficult for the new companies to gain customer loyalty. Therefore threat from
new entrants to Coca-Cola is very low or even negligible. Threat of substitute: When talking about substitutes present for Coca-Cola in market the
major beverage is made by Pepsi. Other than this there are a number of fruit juices and
other hot as well as cold beverages which can be a substitute for Coca-Cola. There are a
number of substitutes present for the product in the market. Also, the switching cost for
customer for a substitute of Coca-Cola is very low. It is also seen that the quality of
substitutes present for the product in the market is also good. Due to all the factors
mentioned above it can be seen that the threat from substitutes for the company is very
high.
Competitive rivalry of existing players: When talking about competitive rivalry in market for
Coca-Cola it is seen that there are basically two major industries in market regarding soda

industry which includes Coca-Cola and Pepsi. The rivalry between these two companies is
intense (Meyfroodt and Desmidt, 2020). There is a major small player too in the market of soda
industry but the competitive threat they pose to Coca-Cola is negligible. It can be seen that the
two major players Coca-Cola and Pepsi are of about similar size and the products and strategies
used by them is also similar. There is no proper product differentiation between these two brands
and the price competition between Pepsi and Coca-Cola is also intense. It is clear from a number
of news scene regarding cola wars in the market. Coca-Cola has to face difficult rivalry from the
strong forces of market competition.
TASK 3
Product portfolio analysis of Coca Cola BCG matrix of Coca Cola
Product portfolio analysis for a company refers to planning the strategy and development for
various products produced in a company. With the help of product portfolio or company can
come to a decision like which products should get more or less investment and also how can
adding a various number of products can affect business as well as eliminating some of them will
bring profits for the company.
BCG matrix is also known as growth share matrix which is an analysis tool for companies to
portray their brand portfolio or product portfolio in the market. This framework was developed
by Boston consulting group so that the strategic position of different products in a brand can be
evaluated. The portfolio is divided into four categories using growth rate of industry and
competitive position or relative market share of product in the industry. There are four quadrants
present in this matrix. Below mentioned are those four quadrants applied on Coca-Cola: Dogs: Dogs include those products which have low growth of market share as well as the
products which are in declining stages. They are considered to be cash traps for the
business. Failing to deliver the results which are expected from a product and losing a lot
of investment in those venture include the products falling in dog quadrant. It has been
seen that there have been low demands for soft drinks as there is an increase in healthy
beverages and 0 calorie beverages. It is seen that due to this the sales of Coke are
declining heavily. However, Coke can be said to be in cash cow quadrant in present. But
it is eventually going to fall in the quadrant of dogs in the coming future due to all these

buying behaviour changes and inclination of customers towards healthy and 0 calorie
drinks. Cash cows: These are the products of a company which have low growth markets but
high market share in the company. The products of cash cow are market leaders in the
industry but they are not expected to see any growth in the future. They can be called as
money churners for a business. For a number of years Coca-Cola have been a market
leader in providing soda drinks or soft carbonated drinks segment. A lot of profit is
owned by company in this segment. The company has presence in more than 200
countries in which its product Coke is the market leader in beverage industry. However,
there is no scope for development in Coke still it proves to be the cash cow for Coca-
Cola.
Stars: These are the best products in the product portfolio of a company. They include
the products which are present in high growth markets and also have high market shares
(Mazzarol and Reboud, 2020). The development of a company through the help of these
products are very high. Companies invest highly in development of the products falling under
stars. When taking Coca-Cola into consideration Kinley and Dasani are the bottled water
provided by company in different international markets. Kinley is very famous in European and
Asian market whereas Dasani is sold in US market. Coca-Cola also provide a number of flavors
for customers to choose from. Kinley and Saini also provide sparkling waters in order to meet to
the need of affluent customers. All these products of Coca-Cola fall under stars quadrant.
 Question marks: Question marks Include those products which have high growth
possibility and can generate revenue and take the position of Star. They can also result to
be the loss-making products for a company if proper strategies are not taken regarding
such products. Potential for growth of such products in the industry is very high but still
company cannot somehow see growth in market shares of these products. Coca-Cola has
come up with a number of 0 calories and no sugar drinks. These require high investment
and capital also various communication tools to spread awareness about the products.
Diet Coke, honesty, sparkling water, minute maid, smart water are some of the products
of Coca-Cola which fall under the quadrant of question mark.
Growth strategy of Coca Cola

There are different types of growth startegies that are followed by a company. Some of
these are internal and soem are external. The internal growth stratgies of the company inculde
diversification, increase of existing capacity and market growth stratgies, etc. Some of these
stratgeis are mentioned below -
Market penetration strategy – The company which pusue this type of strategy is directed from
the resources and managing the profits and benefits of teh company. A company which adopts
this type of strategy provides increase in the sale and profiots of the company.
 Market development strategy – This type of strategy includes the presenting of products
and services into a new geographic area. There are marketing efforts which are allowed
for the company in managing the customers which are associated with the addition of
various distribuion channel by changing the present context of the pomotional as well as
advertsing efforts. This is achived by an organsaition by enetering into new market
segment and entering into new geographical market.
 Product development strategy – In context of the product development strategy, there is
growth through the substantial chyanges within the existing product or service of the
company. This can be done by increasing current business by product for suiting the
varied customer preference.
 Diversification strategy – This conissts of mnaging the operations properly by provding a
positive synergy to the company. This helps in making addition for mnaging the growth
of business and achieving the organsaitional objectoves and goals.
Coca Cola adopts diversification strategy and it is involved in achieving the orgasnaitional
targets and goals by making unique and different products from other competitors. This means
ths company has the opportunity to manage the functioning in effective manner by introduccing
new products and services within market.