Strategic Management Report: First Mover and Coca-Cola Analysis

This strategic management report, prepared by a student, delves into two key areas: industry evolution and global strategy. The first part examines the first-mover advantage within the smartphone industry, critically assessing its effectiveness and sustainability in a rapidly evolving technological landscape. It analyzes the industry's life cycle, evaluating the relevance and limitations of the Industry Life Cycle model in explaining current trends, considering factors like technological advancements and market dynamics. The second part focuses on Coca-Cola, appraising its competitive advantage as an American company, utilizing Porter's Diamond Model to analyze factors like demand conditions, factor conditions, related industries, and firm strategy. The report further explores Coca-Cola's global brand management, examining how it leverages marketing and other functions to maintain its market position. The analysis incorporates relevant strategic models and theories to provide a comprehensive understanding of the subjects.

Running head: Strategic Management
Strategic Management
Name of the Student
Name of the University
Student ID

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Table of Contents
Answer A.........................................................................................................................................2
Answer B.........................................................................................................................................5
Answer C.........................................................................................................................................9
Reference List................................................................................................................................12
Appendix........................................................................................................................................15

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Answer A
(1) First mover advantage is often used in the product manufacturing sector. It means the
advantage a company gets by offering a product or service of new kind for the first time in the
market. The main advantage is the company gets the chance of capturing the market at the
earliest and makes it difficult for the rival companies to make any strategic movement or launch
of new and similar kind of products (Yang, Luo and Wang 2017). For example in the market of
life saving drugs the company that comes with a drug that cures cancer for the first time would
be the first mover and thus it will have every market share. Additionally, the drug is a product of
intensive research and development and the company would have patent right for the product.
Thus, any company working on such product would lose the importance. Therefore, first mover
in a market makes more profit.
Furthermore, in the case of smart phone industry the effectiveness of first mover
advantage is debatable. The reason behind this is that the industry is highly innovative and the
technology related to this industry changes very fast as per the recent market trend (Sabatier and
Chollet 2017). In the smart phone industry when the first large screen smart phone was launched
by Apple under the product name of iPhone and the market responded positively and it was a hit
(Kanter 2018). The total sales of the model before it was discontinued was 6.1 million. The
company made huge profit by selling the said amount of units owing to advantage gained from
first movement. However, with further development the continuous innovation the industry.
Currently, every other day a product is launched in the smart phone industry with better features
than the existing products in the market. Every smart phone that is launched becomes old within
2 months (Buganza et al. 2015). Therefore, a company launched a product with a new camera
feature cannot sustain the market for long time enjoying the advantages from moving first. For

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example, Xiaomi launched a smartphone name Redmi Note 7 pro. The major attraction of the
phone was 48 MP camera and it made a significant stir in the smart phone market. The company
made significant profit from the line of product. However, this does not stayed for long as other
companies like Realme. Samsung and Oppo came up with similar camera specifications and
along with that, they provided additional features such as fast charger in the box, amoled display
and punch hole front camera under similar price range. Therefore, it can be observed that even
though Xiaomi made the first movement in introducing the feature of camera. The company
definitely made the profit but that does not restrict other companies from enjoying the benefit as
they also introduce some new features along with the 48 MP camera feature. To get the first
mover advantage an industry like smart phone needs products or features that disrupt the market.
The features now introduced by the smart phone companies are disruptive in nature but the
longevity of that technology is very short. Just within 6 month of launch of first 48 MP camera
phone, 64 MP camera has also been launched. Therefore, it is clear that first mover advantage
exists in the smart phone industry because from the product launch strategy of the companies it is
evident that every company tries to launch a new feature as soon as possible. In order to do that
the companies are also launching several products each with some new features. The objective of
launching products so frequently is to gain the first mover advantage from launch the feature
first. Thus, it is evident that first mover advantage exists in the smart phone industry.
(2) The smart phone industry emerged in the mid 2000’s with the launch of iPhone a product by
Apple. After that companies like Samsung and Nokia the mobile phone giants launched their
smart phone products (Grodal, Gotsopoulos and Suarez 2015). The smart phones was then a real
upgrade from the keypad based bar phones. The phones provided large number of features that
were never seen in a phone before and thus it was clear jump in the technology grounds. The

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companies that manufacture smartphones then was very few namely Apple, Samsung, HTC,
Motorola, Nokia and LG. Thus, this phase of the industry could be stated as the introductory
stage as per Industry Life Cycle Model. Later, from 2010 and onwards the smart phone industry
entered the growth stage of the industry life cycle (Tavassoli 2015). During this period, smart
phones with better designs were introduced. For the first time phones with larger screens were
introduced with sleek designs and the operating system was improved to android (Cecere,
Corrocher and Battaglia 2015). With the development of android operating system the smart
phones industry saw revolutionary change. The sales go up at rocket speed as the smart phone
market in the developing market was gradually increasing. Smart phones like Samsung Galaxy S
series and HTC Beat changed the definition of design. Along with an electronic gadget people
started to consider smart phones as a fashion accessory as well. New smart phones companies
started to enter the market such as Xiaomi, Vivo, Oppo, Nubia, Lenovo, OnePlus and many other
regional brands. However, many brands exited during this stage. Therefore, it is the growth stage
of the smart phone industry. The third stage of the industry life cycle that is maturity entered the
industry. The smart phones became very cheap. The companies are selling smart phones at the
price that is less than half the price they used to charge for similar or weaker sets previously. The
smart phone has completely penetrated the market and it has become a necessary commodity of
the customers. Commodity or rich once has now become the commodity for all. Therefore, it can
be inferred that the industry has reached its maturity level (Markard 2018). However, as per the
criteria of the Industry Life Cycle Model it can be said that the smart phone industry has not
reached the stage decline.
The Industry Life Cycle Model is quite effective and relevant to the smart phone
industry. The life cycle stages for an industry given in the model are closely appropriate. From

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the growth to decline stage, it has covered significant parameters such as technology, demand,
product, manufacturing, trade and competition (Paik and Zhu 2016). In the previous section, all
these parameters have been linked with the periodic movement of the industry. It has been also
seen that using the given parameters of the model the life cycle stages of the industry has been
easily described. However, if the current phase of smart phone industry is looked upon then it
can be observed that the industry is actually stuck somewhere between growth and maturity
stage. With passage of every few month there occurs some change in the industry. New phones
come up with new features and new designs (Wang, Tan and Li 2018). It depicts that the
industry is in growth stage. In contrary, if the pricing of the products are seen then it can be said
that it is in maturity stage because the prices are going lower as the mobile phone manufacturers
is gaining the production efficiency causing the cost of production to reduce. It is thus possible
that the product of the smart phone industry improves further and enter the stage of growth once
again. This argument can be supported by the recent disruption occurred due to innovation of
foldable smart phone by Samsung and Huawei. The products are highly expensive with
advancement in design and few number of manufacturers are making the product currently.
Therefore, this stage of the industry is relevant to the growth stage. In addition to that, the
industry of smart phones with the innovation of foldable products could possibly make the
tablets obsolete or may be laptops too in near future (Loughran 2019).Therefore, it can be said
that the smart phone industry is in maturity stage with some characteristics of growth stage of the
Industry Life Cycle Model.
Answer B
(1) Coca Cola is an American beverage company that operates all around the world and it is
considered the best brand of beverages. The number of markets that Coca Cola has penetrated

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are large in number. Being the largest beverage company in the world Coca Cola must have
competitive advantage (Chhabra 2016). This allows the company to grow faster and smoothly
(Neeley and Cekin 2017). Rather, in the countries like India, China and other emerging and
developing economies production is cheaper due to availability of the cheap labour and raw
material (Flint 2016).
Coca Cola is an American company and since the US is a developed nation the company
should benefit from the beneficial factors present in the country (Kuo 2017). The competitive
advantage that Coca Cola enjoys for having its origin in the US can be explained with the help of
Porter’s Diamond Model of competitive advantage. It explains four conditions analysing which
presence of competitive advantage of the company can be easily understandable (Gamatche and
Niu 2016). The four conditions are demand conditions, factor conditions, related and supporting
industries and firm strategy, structure and rivalry.
Demand conditions: The demand for products of Coca Cola is significantly high in the US.
Coca Cola manufactures numerous products that target different category of customers from
youth to old. Thus, the company has different kind of demands. The increasing demand for
health drinks and other alternatives of carbonated soft drink has opened up market for new
products (Delogu et al. 2016). The economic condition of country is good with high individual
income. This causes more consumption by the people and thus more demand for the drink
products. Increased amount of sports activity also increases the demand for health drinks
manufactured by the company. Being one of the largest business hub of the world and also
having numerous places of tourist importance the country attracts huge number of tourist causing
the demand to go up further.

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Factor conditions: The US is a developed country and thus the education system in the country
is effectively good. It thus produces large number of skilled labours and the machineries used for
the production are of high quality (Ashaari and Razak 2018). Therefore, the condition of factors
that are required for production are good. Packaging materials produced in the country are of
highest possible quality. There are available amount of space for factory expansion. The
transport system is fast and smooth that lowers cost of production. Technological innovation in
the country is very fast and thus it supports the proper functioning of the company. Thus, Coca
Cola Company enjoys better production facility than it could have in any other country.
Related and supporting industries: The supporting industries of Coca Cola are sugar,
packaging industry and transport industry. Both the sugar and packaging industry are
significantly large in the country (Ip et al. 2016). Most of the leading companies in the packaging
industry like Ball, Mondi, Owens-Illinois and many more. Sugar industry is also the leading in
the world and thus it is easier for any company dependent on it to grow faster.
Firm strategy, structure and rivalry: Coca Cola competes in the market of beverages and is
one of the leading producer of beverages with more than 3900 products in offering (Sharman et
al. 2019). The closest rival of the company are Pepsi Co. and no other company pose any threat
to Coca Cola. Thus, the firm structure is like an oligopoly firm with immense power over the
market due to its size and wide presence.
Therefore, being an American company Coca Cola enjoys favourable conditions in the
above areas. Additionally, if Coca Cola is not an American company it could not has this
competitive advantages it has now. Therefore, the competitive advantages come from the country
of origin and it is the US. Therefore, Coca Cola has competitive advantage for being an
American company.

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(2) The strategies that Coca Cola uses for global integration and national differentiation are
markets segmentation, customer relationship and brand establishment, increase in financial
efficiency, increase in process efficiency, focusing core competencies and business models and
product diversification.
Market segmentation: Coca Cola operates in all around the world and its products are
consumed by consumers of all categories it means consumers of different income category.
Apart from that, taste preference is also a significant parameter and depending on all of these, the
company makes different segment of its market to penetrate at the maximum possible level. This
kind of strategy is made in order to achieve maximum sales. To do this the products packaging
are designed in different size and shapes to attract different types of customers. Thus, market
segmentation is very important strategy that found to be effective for the company to achieve its
level of success.
Customer relationship and brand establishment: Success of any product depends on the size
of the brand. Consumer prefer brands over any non-branded or less popular product. Thus, to
maximize revenue brand establishment is necessary. In addition to that, brand name also
strengthen the relationship between the consumer and the company because brands boost the
trust between consumer and the company (Kumar 2017). Therefore, Coca Cola spend so much
on building brands. For targeting the health conscious consumers and promote their health drink
Coca Cola sponsor sports events. Additionally, by sponsoring sports event it can reach to a large
amount of potential consumers. Sports event are the best medium to reach people globally. Thus,
maintaining customer relationship and building brand image is a key strategy.
Increase in financial efficiency: Making profit sustainably requires efficiency in financial
expenses. Maximum return of investment can only be achieved only when financial efficiency is

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achieved. To achieve that the company formulated zero-based work under which yearly budget is
set to zero. Reduction in non-media advertisements is made to the minimum point. On the other
hand expenses are made in the more important areas like branding, providing more dividends to
shareholders. Achieving financial efficiency strategy does not affect marketing but improves
productivity of the company.
Increase in process efficiency: For a beverage company like Coca Cola process time is very
much important. The demand in the industry rises suddenly and thus to meet such demands it is
necessary to have an efficient process (Perez 2015). With process efficiency, the company is able
to increase its productivity given the same amount of time. It also allows the company to reduce
the cost of production per unit of product. Thus, process is an important part of the business that
helps in achieving more revenue.
Focusing core competencies and business models: Coca Cola has more than 500 types of sub-
brands. The company manages a huge number of bottling partners and it is the core competency
of the company. The major aim of the company is to achieve maximum possible productivity.
The large number of brands and innumerable number of products helps the company achieve
large amount of revenue even when the economy is struggling.
Therefore, it can be concluded that the above are the major strategies that helped Coca
Cola to maintain global integration and national differentiation.
Answer C
Samsung in one of the biggest manufacturer of smart phones and it captures the largest
share of the market with 21.8%. However, competition in the smart phone industry is intense as
the other brands like Huawei with 18.6% and Apple with 13% market share are not very far.

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Thus, Samsung need to consider all the aspect of the industry and make suitable strategies to
increase the market share and thereby profitability of the company. However, to make a suitable
strategy it is necessary to identify the factors affecting Samsung and market issues and drivers.
From the PESTEL analysis and SWOT analysis it can be observed that Samsung has significant
amount of global presence and it can easily penetrate in any market it wants to (Ling 2017).
Currently, the company is competing the flagship devices and their flagship devices are Galaxy
Note 10 and Galaxy S 10. But the challenge the company is facing is the new devices by its
competitors like OnePlus and Huawei at price lower than products of the Samsung providing
comparable features and technology (Renz and Vogel 2016). On the other hand, the budget range
devices are not good enough to stay in the market for long and apart from that smart phone
manufacturers like Xiaomi, Realme, Vivo and Oppo are gradually capturing the market.
Therefore, it is necessary for Samsung to look into its budget range products as well as the
flagship. The share of Samsung has reduced gradually in the last few years. Other competitors
are catching up with the Samsung products. The innovation of the company was the strength and
thus it should focus on it to improve the product line up. The smart phone industry is highly
innovative and all the companies are investing in R&D sector and hence it will be difficult for
Samsung if it does not take necessary measure to be on the market. It might face the industry
consequences like in the case of Nokia. However, the current condition of the smart phone
industry is quite good as the aggregate sales volume of the industry is rising. People are treating
smart phone not just as a device but a fashion accessory and thus many are using more than one.
It has also been observed that the customers are changing devices within average period of 1.5
years. In the case of legal and environmental aspect there is no such challenges for Samsung as
the company is efficient enough to deal with these problems. Therefore, considering the

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challenges the recommendation for the company that would improve its market is give in the
following paragraph.
From the above analysis it is found that the main challenges that Samsung faces in the
smartphone industry is intense rivalry, availability of potential substitutes and significant
bargaining power of customers. Thus, considering the condition of the industry of smart phones
it suggested that Samsung should come up with new innovative products with completely new
features (Funk 2015). Thus, the company should invest in R&D because without a new product
in the market it is impossible to compete with similar kind of products that are offered by rival
companies. Previously, amoled display was exclusive to Samsung smartphones only but it is not
the case now. Hence, new and effective innovation is required from Samsung. Therefore, to
increase the market share and competitiveness the company should take the above strategies.

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Reference List
Ashaari, N.I.M. and Razak, N.A., 2018. Impacts in Restricting the Employment of Foreign
Labours in Malaysian Construction Industry. CLIMATE CHANGE AND CAMPUS
SUSTAINABILITY, (5RCCS2018), p.111.
Buganza, T., Dell'Era, C., Pellizzoni, E., Trabucchi, D. and Verganti, R., 2015. Unveiling the
potentialities provided by new technologies: A process to pursue technology epiphanies in the
smartphone app industry. Creativity and Innovation Management, 24(3), pp.391-414.
Cecere, G., Corrocher, N. and Battaglia, R.D., 2015. Innovation and competition in the
smartphone industry: Is there a dominant design?. Telecommunications Policy, 39(3-4), pp.162-
175.
Chhabra, G.K., 2016. CASE STUDY OF COCA COLA’S EKOCOOL SOLAR COOLER; A
FRUGAL INNOVATION SERVING AS A SOURCE OF SUSTAINABLE COMPETITIVE
ADVANTAGE IN RURAL MARKETS OF NORTHERN INDIA. International Journal of
Marketing and Technology, 6(7), pp.119-129.
Delogu, F., Huddas, C., Steven, K., Hachem, S., Lodhia, L., Fernandez, R. and Logerstedt, M.,
2016. A Dissociation Between Recognition and Hedonic Value in Caloric and Non-caloric
Carbonated Soft Drinks. Frontiers in psychology, 7, p.36.
Flint, S.W., 2016. Are we selling our souls? Novel aspects of the presence in academic
conferences of brands linked to ill health.

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Gamatche, A.A. and Niu, S., 2016. Research on the Smartphone Fast Growing Impact on Mobile
Gaming Industry in China. Journal of Management, Marketing and Logistics–(JMML), ISSN,
pp.2148-6670.
Grodal, S., Gotsopoulos, A. and Suarez, F.F., 2015. The coevolution of technologies and
categories during industry emergence. Academy of Management Review, 40(3), pp.423-445.
Ip, I., Fong, S., Zhuang, Y. and Wong, R., 2016, November. Competitive Intelligence Study on
Macau Food and Beverage Industry. In 2016 7th International Conference on Cloud Computing
and Big Data (CCBD) (pp. 170-174). IEEE.
Kanter, R.M., 2018. Smart leaders focus on execution first and strategy second. Available at)
(Accessed January 4, 2018) https://hbr. org/2017/11/smart-leaders-focus-on-execution-first-and-
strategy-second View in Article.
Kumar, R., 2017. Strategic Financial Management Casebook. Academic Press.
Kuo, L., 2017. Another Perspective on the Coca-Cola Affair in Postwar France. Enterprise &
Society, 18(1), pp.108-145.
Ling, X., 2017. Customer Relationship Management: Case study Coca-Cola Company.
Loughran, J., 2019. Foldable screens and 5G compatibility steal the show at MWC. Engineering
& Technology, 14(3), pp.9-9.
Markard, J., 2018. The life cycle of technological innovation systems. Technological Forecasting
and Social Change.
Neeley, T. and Çekin, E., 2017. Global Leadership in a Dynamic and Evolving Region:
Molinas@ The Coca-Cola Company (A).

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Paik, Y. and Zhu, F., 2016. The impact of patent wars on firm strategy: evidence from the global
smartphone industry. Organization Science, 27(6), pp.1397-1416.
Perez, B.E.A., 2015. The power of sustainability to create shared value: Coca-Cola demonstrates
that doing good is good for business. Journal of Brand Strategy, 3(4), pp.310-315.
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Appendix
PESTEL Analysis
Political Samsung operates in various country thus it has to abide by the rules and
regulations of different countries. The company has to keep in mind the
political condition of a country when making promotional campaign and
advertisements. Manufacturing and product license rules are also need to be
complied.
Economic Product launch depends on various kind of economic factors. Country with
low income is not a market for flagship product. Before entering in to
business economic condition, income of individuals should be considered.
Social Social factor defines the taste of the customers. Demographics also defines
the type of demand for products.
Technological In smart phone industry technological innovation is very high and thus its
impact is significant. Thus, it has considerable amount of impact in the sales
of Samsung smart phones.
Environment The production process should be such that the environment does not get
affected or polluted causing loss in social welfare.
Legal Samsung should abide by all the laws of the respective countries in which the
company operates in.

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SWOT Analysis
Strength  Large brand
 Strong R&D
 Market leader
Weakness  High cost per unit of product due to high expenses in advertisements
 Lack of product in budget range
Opportunity  Potential market
 Technological innovation
 Rising sales of smart phones
Threat  Presence of potential competitors
 Competitors are leading the budget range smart phone market
 Competitors are catching up with the technology of Samsung