Coca-Cola Marketing: Strategic Analysis, Options, and Recommendations

This case study provides a comprehensive analysis of Coca-Cola's marketing management strategies, including a company and industry background, VRIO analysis, PESTEL analysis, Porter's Five Forces analysis, and SWOT analysis. It examines Coca-Cola's strengths, weaknesses, opportunities, and threats, and uses a TOWS matrix to develop strategic options. The analysis identifies diversification and product development as winning strategies for Coca-Cola, emphasizing the importance of leveraging brand value, market presence, and adapting to changing market trends. The study concludes with recommendations for strategic initiatives to enhance Coca-Cola's business viability. Desklib offers a platform for students to access similar solved assignments and past papers for academic support.

COCACOLA
Marketing management

COMPANY AND INDUSTRY
BACKGROUND
Company background
 Coca Cola is the leading brand in terms of
global coverage and revenue in the
beverage sector
 Competitors such as PepsiCo and other
brands are increasingly affecting their sales
potentiality
Industry background
 Global soft drink industry is having positive
outlook in the near future and it is
projected that this industry will grow at the
rate of 5.70 percent till 2023

VRIO ANALYSIS
Valuable financial resources, brand
value, access to strategic
resources and supply
chain management
Rarity Strategic resources of the
organization are not
accessible by the competitors
and thereby they are rare
Inimitability Branding and brand elements
of Coca Cola are inimitable
Organizational capability Extensive distribution
strategy of the organization
has helped in enhancing the
capabilities while competing
with the other existing
players in the market

PESTEL ANALYSIS
Political factors
•Coca Cola is operating in different countries
across the world in diverse political scenarios
•Differences in the political ideologies in
different countries are also affecting their
business
Economical factors
•Growth in the average global economy is posing
positive impacts for Coca Cola in their business
•Increase in the competition is causing challenges for
Coca Cola
•Emergence of economic downturn and recession like
in 2008 will further reduce the business of Coca Cola
Social factors •Rapid changes in the taste and preference pattern of
the customers
•Negative word of mouth due to selling carbonated
drinks
•Diverse product portfolio of Coca Cola is helping in
meeting the different taste pattern of the customers
(Schmidt, Spann and
Zeithammer 2014)

PESTEL ANALYSIS
Technological factors •Coca Cola introduced automated bottling
process
•Rapid development in the technological field is
posing challenges for Coca Cola due to the
added cost
Environmental factors
•Coca Cola was accused in past for depletion of
ground water
•It is important for them to align with different
environmental and sustainable factors
•It is also important for them to meet the different
legal obligations
Legal factors •Different countries are having different sets of legal
obligations for the business
•Coca Cola must adhere to the investment related
legislations in different countries
•Different countries have already implemented taxes
for the fast and soft drinks

FIVE FORCES ANALYSIS
Bargaining power of the buyers
•Coca Cola is having higher degree of
bargaining power of buyers.
•Price level is same and thus customers can
bargain the end product price by marketing
forces
•Switching cost is also low for the customers
Bargaining power of suppliers
•Bargaining power of suppliers is low for Coca Cola
due to the less dependence on external partners
•Coca Cola is having effective backward as well as
forward integration
•Brand value for Coca Cola is much higher than that
of the suppliers and thus the suppliers are more
dependent on Coca Cola (Knott 2015)
Threat of substitutes •Threat of substitute is more due to the presence of
number of competitors
•All the competing products are having same value
proposition
•Customer loyalty for Coca Cola is lower and
fluctuating

FIVE FORCES ANALYSIS
Threat of new entrants •Threat of new entrants is moderate
•The local brands cannot match the level of
Coca Cola in terms of brand value and market
coverage
•Coca Cola is facing competition from them in
different local regions across the world
Competitive rivalry •Competitive rivalry is high in this sector with the
presence of number of brands
•Price war is common to attract the majority of the
customer bases
•Aggressive marketing activities are also being
initiated by the competing firms

SWOT
Strengths
Brand value for Coca Cola
Diversified product portfolio
Huge global market coverage (Barkay,
2013)
Weaknesses
Negative publicity for Coca Cola
The organization is having lower
market presence in alternative
segments other than the carbonated
soft drinks
A number of lawsuits being faced by
Coca Cola in terms of unethical
business practices
Opportunities
Entering in alternative segments such as
fruits juice and dairy based products
Offering premium products under different
sub brands
Investing more in the developing markets
Threats
Emergence of economic recession will pose
issues for Coca Cola
Coca Cola is also facing the challenge from
the side of legal authorities
Introduction of cheaper and healthier
alternatives in the market will pose threat in
the existing business of Coca Cola

TOWS MATRIX
Strength – weaknesses
•Positive and highly
penetrated brand value of
Coca Cola should be used in
mitigating the negative word
of mouth
•The existing market
presence of Coca Cola can be
used in pushing alternative
products in the markets
much like PepsiCo.
Opportunity – threat
•Coca Cola should offer
alternative and premium
products under the different sub-
brands to mitigate the challenge
of healthier alternatives
•Investing more in the developing
nations will help in mitigating the
holistic impact of the economic

CURRENT STRATEGIC
POSITION
 Coca Cola is having extensive market
coverage and branding in the global
scenario
 Extensive market coverage has helped
CocaCola in positioning their products
as a truly global product.

STRATEGIC OPTIONS
Suitable Acceptability Feasibility Accept/reject
Coca Cola should
initiate
diversification
strategy
The organization
should invest capital
in having separate
entities for newer
business segments
Will incur huge
capital for Coca Cola
Accept
Coca Cola should
also initiate market
focus strategy
The recommended
products should be
premium over their
existing mass
market products of
Coca Cola
Should incur cost in
new product
development
process
Accept
Product
development can
also be initiated by
Coca Cola to have
larger variants of
their existing
products in terms of
flavors, types and
price
New product
development should
be done in
accordance to the
changing market
trends
Investment is
important in
developing the
existing products
Accept

CONCLUSION AND SELECTION
OF WINNING STRATEGIES
 Coca Cola is having a number of
potential strategies that can be
beneficial in enhancing their business
viability
 Diversification will be one of the major
wining strategies for Coca Cola
 Product development can also be
beneficial for Coca Cola in the long term
by having more product variants

REFERENCES
 Barkay, T., 2013. When business and community
meet: A case study of Coca-Cola. Critical
Sociology, 39(2), pp.277-293.
 Knott, P.J., 2015. Does VRIO help managers evaluate
a firm’s resources?. Management Decision, 53(8),
pp.1806-1822.
 Schmidt, K.M., Spann, M. and Zeithammer, R., 2014.
Pay what you want as a marketing strategy in
monopolistic and competitive markets. Management
Science, 61(6), pp.1217-1236.
 Tedlow, R.S., 2014. The fourth phase of marketing:
Marketing history and the business world today.
In The Rise and Fall of Mass Marketing (RLE
Marketing) (pp. 24-51). Routledge.