The Strategic Positioning Methods by the Coca-Cola Company - Research Paper Example

COCA-COLA COMPANY’S STRATETIC POSITIONING OF THEIR PRODUCT LINE By Strategic positioning is the attempt by a company to identify itself or to occupy a niche in a market for its products. It also involves trying to create favor from customers over the competitors. A product line is the collection of related goods from one company (Chris 2004). Managers should take a proper market research before trying to avail their products in a market. The market should first be segmented. This is division of the markets based on different factors. Identification of target groups should then be done, with distinct and reasonable basis being used. The final part is to position the product or product line in the market. These steps form the STP process (segmenting, targeting, positioning process) (DuBrin 2008). In this document, the strategic positioning methods used by Coca-Cola Company on its product line in the international markets are focused. It analyzes how the company has faced out competitors to maintain favor from customers. Coca-Cola Company is a soft drink and beverages manufacturing company with the main office based in America and have spread all over the world. It also retails and markets their product in more than 200 countries globally. Its main product, “Coca-Cola” was invented in 1886 by John Smith Pemberton who was a pharmacist. The company sells over 500 brands, over 1.7 billion servings per day. It has franchised globally since1889 where it used to produce syrup and selling it to other companies. It has an anchor bottler in North America. It acquired a number of companies to minimize competition and reach its current state, almost a monopoly. This document discusses the different methods used by Coca-Cola to create and maintain its market. Strategic positioning has been successful to Coca-Cola Company in that it has enjoyed so much market share and preference and loyalty from its customers. It has achieved its positioning internationally through seven different ways; Product Attributes Coca-Cola has kept their products distinctively different from their competitors. They have different products within the product line, with different fruit flavors which seem to have curbed other competitors who try to establish themselves on the fields Coca-Cola has already dominated. The soft drink has also been associated with great events worldwide, Coca-Cola sponsoring the events. This shows that the product can match well with the situations people are undergoing. The company’s introduction of different flavored product line ensures customers can enjoy a wider variety of the products they offer; they have also tried to introduce a zero gaseous soft drink different from the rest. The product can also last longer; this widens their market accessibility as they can travel a distance to where the customer is without any problem of getting wasted products due to spoilt products. The Coca-Cola’s positioning statement, “open happiness,” shows the association of the product to the happy occasions enjoyed by their customers which must have a product of the company to complete the success of the occasion. Competitors Competitors can be very helpful in the positioning activities. This can be done through differentiating the company’s product from theirs. Even though this is not allowed in an equal trade practices to be done through advertisements, it can still be done differently (Trout 1969). Coca-Cola products enjoy a great market share. An advertisement on the Turkish market by a franchised company to Coca-Cola, Cola Turka, does an advertisement done by an American Chevy Chase; he drinks the soda then starts singing in Turkish language. This shows how the product is strongly established in Turkey. The advertisement also done in Africa shows how the company dominates the wider Africa’s market as compared to their competitors who cannot reach the level Coca-Cola is currently. Use or Application Positioning can also be done by associating a product to their uses. A product can serve an important purpose, which becomes a memorable use of the product (Moore 1991). The sponsoring of 2010 world cup events by Coca-Cola in Africa shows how important the company can be to the African people. Coca-Cola products are also associated to quenching thirst; this makes an individual opt for a coke in a burning sunny day. Sprite, a Coca-Cola product uses the thirst quenching technique in the market. Price-Quality Relationships Prices and quality use in positioning is also important to a company. When the product is of low price compared to others, their prices are considered, and when it is expensive the quality of the product becomes the focusing point in its sales (Ries 1981). Coca-Cola provides their soft drinks at a very low cost, depending on the country of production. They also maintain a high quality profile in the manufacture of their products to ensure customers obtain what is best at a lowest cost. This has kept competitors out as they can’t lower their prices as Coca-Cola Company has yet they must maintain a certain profit margin, they end up falling out. Product Users Positioning basing on the users of the product has been widely used in marketing. A company uses a target group, specifies on the recommendations of that target group then focuses their selling to them. Identifying youths as a target group or product users is the best technique companies have use due to the experimenting nature of the youths (Elspeth 2002). Coca-Cola’s advertisements have majorly concentrated on the youths; the sprite advert youths playing basketball or even the coke where a bottle top is being thrown from one place to another. Product Classes These are the categories of other usable items the product fits. This helps the product in its sales in that the purchase of one product leads to the purchase of another. Coca-Cola products have recently been associated with meals. A family ensures there is a bottle of soda on the table as they take their meals. The company has tried not to differentiate its market into different classes maintaining a same level of prices for their products showing a unifying factor (Olins 1989) Cultural symbols Cultural symbol positioning is a technique where a product or brand is associated to a certain culture or religion. In the Middle East, the Coca-Cola Company has associated its products to the Muslim religion; their product Mecca Cola has started gaining market in Europe and the Arab world. The name Mecca, and slogan, “Don’t drink stupid. Drink committed” upholds the Muslim religion hence attracting Muslim customers. Strategic positioning process has not been easy for The Coca-Cola Company until it current level. There are challenges which have to be focused when positioning internationally. Changes in technology have been a problem especially on the infrastructure of that nation. The country of origin also affects greatly on the marketing strategies (Barker 2008). It is hard to start a market on Arab world especially United States being the origin country. Issues of regulations set by the country also affect the positioning process. The Coca-Cola Company has been able to maintain its position internationally for many years. Beating it would be hard for a competing company in that the company almost runs as a monopoly in the soft drinks industry, leading the market, setting prices and enjoying the loyalty of the consumers. The acquisition of other competing companies affirmed its domination internationally. 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