Coca-Cola's Strategic Management: Analysis of International Strategies

This essay examines Coca-Cola's strategic management, focusing on its long-term international strategies, including brand building, innovation, and customer loyalty. It analyzes internal environmental factors using SWOT analysis, highlighting strengths like brand equity and weaknesses like water management issues. External environmental factors are assessed through PESTEL analysis, covering political, economic, social, technological, environmental, and legal aspects. The essay reviews the implementation and success of Coca-Cola's operating strategies, emphasizing its effective supply chain and distribution management. The conclusion summarizes Coca-Cola's market position and the key strategic factors influencing its business.

Strategic Management
assignment 1

Table of Contents
Introduction......................................................................................................................................4
Main body........................................................................................................................................4
Long term international strategies...............................................................................................4
Internal environment factors........................................................................................................5
External environmental factors....................................................................................................6
Review on implementation and success of Coca Cola operating strategy...................................7
Conclusion.......................................................................................................................................8
REFERENCES................................................................................................................................9

Introduction
Strategic management refers to the management of the ongoing plan, monitoring all the
process of the company whether it is in the direction of achieving organisational goal or not. The
Coca cola company is a multinational beverage company mostly known for manufacturing cold
drinks. It is a very successful company in the field of beverages. It is leading the market in many
countries. The Coca-Cola company runs 200 brands of beverages across the world (THE Coca
Cola COMPANY, 2021). This essay will discuss about the long term international objectives and
strategies of the company. It will also analysis the internal and external environment of the
company using SWOT and PESTEL analysis module. The essay will also review on the
implantation and success of the company's international operating strategies.
Main body
Long term international strategies
Coca Cola is popularly known as the leading market company in many countries. The
objectives and the strategies of the coca cola company has been very effective and it is one of
the main core competencies of the company. Objectives and strategies of the company are:
Brand Building: The main organisational goal of the company is to build the brand with
the use of most effective marketing strategy. Company focus on the need and desire of the
customer in order to prepare the effective marketing strategy (Steenkamp, 2020). Approach of
the company include Human Insight, Superior Products, Brand Bundle, Customer Journey
Engagement and Networked way of working and culture. Coca Cola uses these factors to make
the best marketing strategies in order to improve the brand building of the company. The source
of marketing also plays an important in the effective strategy of the company. It aims the
fundamental transformation and the ways of execution of marketing programs. Research, media,
campaign optimization, zero based views, creative agency and production and development are
the steps taken by the company in marketing effectiveness and efficiency.
Innovation: It is also a major prioritised objective of the company. Innovation in the
product and the brand is necessary (Kahn, 2018). Coca Cola never stop in innovation of different
ideas. Business is approaching various innovation through different lenses. Innovation of the
company is more than just change in the flavour of product. Innovation can also be tech driven or
simplifying the packaging. Coca Cola has been innovating the operating techniques and the
utilization of the raw material as the water conservation is very important and water is majorly

used in the company as a raw material. Various innovative ideas are prepared for the better
utilization of the water and the other resources of the company. Other objectives that are also
achieved with the innovation are significantly increased new drinkers, frequency of existing
drinkers and value of the company. The 2021 innovation measurement is taken by the company
that include +40% new projects vs. 2020, 45% value form big bets projects and 20% incremental
gross profit contribution vs.2020 (GROWTH STRATEGY. 2021).
Customer Loyalty: The growth of the company is highly dependent on the loyalty of the
customer. The objective of the company is to satisfy the customer. Various approaches are taken
to understand the need and expectation of the customers that can be used to modify the product
according to the taste of the customers. The long term goal of the company is the customer's
loyalty so that company can maintain its position in the market. International marketing
strategies are prepared on the basis of customer needs. The supply chain of the company is also
prioritized as the majorly availability of beverages impact the sale of the company. Loyalty of
the customer helps the business in the long run (Budur and Poturak, 2021).
Internal environment factors
International environmental factors of coca cola can be analysis with the help of SWOT
method. It refers to the strength, weakness, opportunity and threats of the company (Phadermrod,
Crowder and Wills, 2019). Following is the SWOT analysis of the company.
Strength: brand equity is the major strength of the company as it has been awarded with
the highest brand equity award (Coca-Cola Regains Title as Most Effective Brand in 2019,
2019). Customer loyalty is also strength of the company because of such strong products of the
company. People are more likely to prefer coca cola as compared to other beverage brand. Coca
Cola has the largest market share in the field of cold drinks in United Kingdom.
Weakness: Water management has been an issue for the company as several groups
raised lawsuit against Coca Cola for vast consumption of water even in water scarce areas.
Company has ben also blamed for mixing pesticides in the water. Another weakness of the
company is that it has absence in the health beverages, company do not produce health beverages
and people are being health conscious these days. Competition with Pepsi is increasing, both
companies have a great market influence in the market. Although Coca cola has bigger market
but Pepsi can overtake the company if product diversification is continuous to be low.

Opportunities: Many opportunities are there which can be helpful in the growth of the
company such as Product diversification can be a good opportunity (Panigrahi, 2020). Company
can produce health drinks and other food items. It will increase the revenue from exiting
customer by cross selling. The supply chain of beverages can also contribute in the sale of other
products. Although, developing nations have high presence of the coca cola, still company can
increase its reach in many areas countries like India are still being introduced with soft drinks
and the hot summer in such countries increase the cold drink consumption. This can be a great
opportunity for the company. Supply chain improvement can also be a good opportunity for the
company as major task of the business is transportation and distribution. Rising transportation
cost may lead to the cost sink and there is always an opportunity for improvement in the supply
chain.
Threats: Coca Cola uses huge amount of water in the production process. Therefore,
water scarcity many be a major threat for the business. Raw material sourcing may also be threat
for the company. Healthy beverages companies are becoming more popular that may lead to the
loss of the market.
External environmental factors
External factors that affect the business in various form both positive and negative can be
analysed with the help of PESTEL module. Opportunities and threats for the company are
determined by using this model (Pan, Chen and Zhan, 2019). Following are the PESTEL analysis
of the Coca Cola.
Political Factor: It refers to the effect the company by the changes in government rules
and regulation. It includes tax policy, trade restrictions and tariffs. Changes in the labour laws,
taxation and employment condition may affect the sale of the business. Companies like coca cola
are highly depended on the government policies about sugar and caffeine consumption. The
stable government countries are the opportunities for the company and the high taxation on sugar
in the United Kingdom which is one of the main market of the Coca Cola has lead to the increase
in the cost of the product.
Economic Factor: These factors are related to the inflation, economic growth, exchange
rates and employment rates (Yüksel, 2012). Company spend a large amount of its budget on
solving water crises issues. The economic crises due to the COVID-19 has affected the company

a lot. The cost of raw martial and transportation is raising and that be a major risk to the
company. Many customers have been faced financial crises due to the pandemic and it reduces
the consumption of the soft drinks.
Social Factor: it refers to the factors such as customer behaviour, trends, lifestyles and
health consciousness that have impact on the business growth. Coca cola has faced a major
downward in the growth because Cristiano Ronaldo preferred water instead of Coca Cola (Coca-
Cola loses billions in market value after Cristiano Ronaldo removes bottle, 2021). It influenced
the people and lead to the loss of share in the company. Health is being prioritised by the people
as they are avoiding products like Coca Cola and consuming healthy beverages.
Technological Factor: It refers to the changes in the growth due to the changes in the
technology incentives and rate of change in technology. Social media advertising has been a
great opportunity for the coca cola. The use of technology in the company has improved the
growth in the sale of the product. The customer engagement has also increased on social media
platforms. Technological factor has provided company a wide range of marketing platform and
online sale has also increased the growth of the business.
Environmental Factor: It refers to the impact of weather conditions, climate change,
pollution and natural disaster on the growth of the business. Coca cola has been affected by the
environmental factors. The major reason of coca cola being affected is the water, company has
been faced massive backlash from the environmental groups (MacDonald, 2018). Coca Cola has
introduced many eco-friendly programs and it reduce the challenge for the company.
Legal Factor: Lawsuit and the policies of the countries that affect the business growth
are considered as legal factor. Many countries have already issued a range for sugar usage in
beverages, company has wide area of service so it needs to consider the law. Failing to do so
may lead to the legal prosecution.
Review on implementation and success of Coca Cola operating strategy
Coca Cola operating strategies is the reason for the success of the company. Company
uses the most effective way of operating way of production that lead to the better quality and
taste of the beverages. Company provides over 200 brands of beverages which leads to the wide
range of the beverages alternative in the market. People are more likely to prefer Coca Cola
because of the availability of the product in the market. It has very effective supply chain and
distribution management that help the company to operate the business internationally. Coca

Cola is operating its business in 200 countries successfully, the management of this operation is
done very carefully. The market of every country monitored and effective changes are done in
order to manage the issue in the operating process. Forecast plays an important role in the
success and implementation of the international operating strategy (Taylor and Letham, 2018).
Operating strategy of the company is very effective as the supply chain management of the
company is very strong. The distributors of the coca cola never went out of stock. Currently
company is using Route to market strategy. It refers to the determination of the distribution of
the channels that are used to deliver the product to the target market (Slater, 2018). Coca Cola
understands which market need to be targeted and channel planning and designing are done
accordingly. Channels are build and made effective to increase the sale of the company. In order
to get the implementation done successfully innovative ideas are prepared that helps the
company in customer focus and aligns strategic goals offerings that can help in supporting
operational capabilities. It also allows the business adopt the change rapidly. These are the major
factors of the operational strategies of the Coca Cola company.
Conclusion
From the above essay it can be concluded that Coca Cola is the largest beverages
company with 200 brands of beverages in the market. The international long term strategies of
the company include brand building, innovation and customer Satisfaction. Water usage was the
major internal environmental factors that affect the business. Swot analysis of the Coca Cola lead
to the opportunity of diversification of the product that may include healthy beverages and other
snacks products. External environmental factors that affect the business were Political,
economic, social, environmental and legal. These factors offer opportunity as well as became
threats to the company. This essay also highlight the successful implementation of the
international operational strategy of the company.

REFERENCES
Books and journals
Budur, T. and Poturak, M., 2021. Employee performance and customer loyalty: Mediation effect
of customer satisfaction. Middle East Journal of Management. 8(5). pp.453-474.
Kahn, K.B., 2018. Understanding innovation. Business Horizons. 61(3). pp.453-460.
Pan, W., Chen, L. and Zhan, W., 2019. PESTEL analysis of construction productivity
enhancement strategies: A case study of three economies. Journal of Management in
Engineering. 35(1). p.05018013.
Panigrahi, V., 2020. An Organisation Study On The Coca-cola Company (Doctoral dissertation,
CMR Institute of Technology. Bangalore).
Phadermrod, B., Crowder, R.M. and Wills, G.B., 2019. Importance-performance analysis based
SWOT analysis. International Journal of Information Management. 44. pp.194-203.
Slater, M., 2018. Distribution vs destination: the route to market. On Tap. 2018(4). pp.32-34.
Steenkamp, J.B.E., 2020. Global brand building and management in the digital age. Journal of
International Marketing. 28(1). pp.13-27.
Taylor, S.J. and Letham, B., 2018. Forecasting at scale. The American Statistician. 72(1). pp.37-
45.
Yüksel, I., 2012. Developing a multi-criteria decision making model for PESTEL
analysis. International Journal of Business and Management. 7(24). p.52.
Online
Coca-Cola loses billions in market value after Cristiano Ronaldo removes bottle. 2021. [Online].
Available through <https://www.independent.co.uk/news/business/news/christiano-
ronaldo-coca-cola-value-b1866890.html>
Coca-Cola Regains Title as Most Effective Brand in 2019. 2019. [Online]. Available through
<https://www.lbbonline.com/news/coca-cola-regains-title-as-most-effective-brand-in-
2019-effie-index>
GROWTH STRATEGY. 2021. [Online]. Available through <https://investors.coca-
colacompany.com/strategy/growth-strategy>
MacDonald, C., 2018. COKE CLAIMS TO GIVE BACK AS MUCH WATER AS IT USES. AN
INVESTITGATION SHOWS IT ISN'T EVEN CLOSE. [Online]. Available through
<https://www.theverge.com/2018/5/31/17377964/coca-cola-water-sustainability-
recycling-controversy-investigation>
THE CocaCola COMPANY,2021. [Online]. Available through <https://www.coca-
colacompany.com/company>
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