Segmentation, Targeting, and Positioning Strategy of Coca Cola BlK - Essay Example

? MARKETING Segmentation, Targeting and Positioning strategy of Coca Cola BlaK …………………. College/ ………….. …………. Introduction This piece of research paper is an attempt to address the theoretical underpinning of segmentation, targeting and positioning strategy and analyze this with example of Coca Cola BlaK. The basic marketing strategies that Coca Cola adopted for its BlaK brand and its perceptions regarding marketing mix and distribution variables will be outlined in this paper. A brand which became fame in the market in 2006 and disappeared in 2008 has been chosen because studying and analyzing it will be more relevant than an existing or successful one. The STP strategy of Coca-Cola BlaK Segmentation strategy Coca Cola BlaK has been one of the major designs that Coca Cola developed to recover its declining sales during 2005. The BlaK drink was not only a flavour extension, but rather a stimulating blend of variety of coke refreshment, with quality coffee essence and lightly carbonated with an aim to appeal to adult consumers (singleservecoffee.com, 2006). The company targeted a specific segment for marketing BlaK, comprising of adult, 30-over savvy sophisticated achievers. Segmentation is a company’s key marketing dimensions to set strategic framework and are marketing processes used to identify the right customers of a company (Bygrave and Zacharakis, 2010, p. 170). Almost all companies segment its markets, breaking down the total market of a product or service in to distinct sub-groups (Lancaster and Reynolds, 2001, p. 68) such as Geographical (region/population density), demographic (age, sex, marital status, socio-economic status, social class, religion etc), psychographic (life-style, personality, self-image etc) and behavioural (rate, volume, occasion, brand loyalty) (Stone and Desmond, 2007, p. 175). When it comes to the case of BlaK, the company identified an opportunity for BlaK from various regions including US, France, Spain, Czech Republic and later in Canada and UK. Demographically, its market was high-class, sophisticated achievers (Farr, 2007). The example of BlaK cola shows that extensive research often requires for an effective segmentation and targeting. As Loudon, Stevens and Wrenn (2004) pointed, a highly customized method of segmentation based upon extensive research and up to date data requires a high degree of expertise in research (p. 33). Coca-cola company has invested heavily in researches during 2002 about users and their perceptions of coke products. This research brought the significance of coke for adults who are between 30 and 50 age savvy people who are less likely to use Coca Cola’s other brands. The company executives thus thought to develop a unique drink merging ordinary coke with an energy drink or coffee essence aimed at adults over 30 savvy people (Wilbert, 2006). This research helped the company identify a hidden market opportunity and find a market segment which was until then left-untouched. Targeting Strategy Coca-Cola company targeted mainly the male demographics with ingredient of coffee essence. The Coca Cola BlaK was appealed mainly to older, more sophisticated and over-30 customers who are likely to spend more (Lamb, Hair and McDaniel, 2008, p. 258). A marketer may target a group of people or organizations by designing, implementing and maintaining a market mix in order to meet the needs of that specific group (Lamb, Hair and McDaniel, 2008, p. 220). When it comes to BlaK, the research conducted by Coca Cola found that there is an opportunity for a drink, being made quite unique with additional coffee essence, targeted for male-adults who are over-30 savvy and sophisticated achievers. the target was thus very specific. When a specific group is targeted, various marketing mixes like price, product, place and promotion can be developed according to the needs, behaviour and specific requirement of the targeted group. Ferrell and Hartline (2008) emphasized that a firm can adopt any or more of different targeting strategies from 1) single segment strategy, 2) selective targeting, 3) Mass market targeting, 4) Product specialization and 5) Market specialization (p. 178). The BlaK has adopted both single-segment and selective targeting strategies. Company has chosen a very specific and single segment which is adults 30-over and it was selective targeting too. Positioning Strategy It is one of the most important marketing objectives that the brand being communicated to the customers must be positioned in their minds and be able to retain customer or create brand loyalty. For a better targeting and brand positioning, Coca Cola has long been relying on various combinations of advertising media like print, broadcast, sports and food ball spectacular etc. Integrated Marketing Communication has thus been a strategy that Coca Cola used for marketing its BlaK products and effective positioning. Coca Cola advertisement has been keeping reinforcing its customers to a unique appeal of ‘what a great drink it is’ (USC Marshall, 2010) and this statement was an illuminating example for what Rafinejad (2007) stressed that it should normally start with a positioning statement to articulate the product values to the customers and its comparative advantages to the competitors (p. 98). The brand positioning is the thought triggered to the minds of consumers when they see, hear or think about the product or its image or its name. Coca Cola always presents a unique personality, values and experiences that people associate them with the company and its valuable name (Hiebing, Hiebing and Cooper, 2004, p. 145) which is the basic ideology of its positioning strategy. In order to communicate the brand and company’s strategic mission, Coca Cola took help of a advertising agency in 2005 to create a campaign for its BlaK drink, targeting the ‘saavy and sophisticated achievers’ (Wilbert, 2006). With integrated marketing communication, a firm can plan, design and develop brand communication strategy to its customers, employees and associates in order to bring both financial benefits and long term brand value (Schultz and Schultz, 2004, P. 3). Why BlaK has been discontinued? There were better planning, extensive researches and effective strategic missions, but still, BlaK’s production has been discontinued. Why? The product was priced as $1.99 which was expensive as compared to the normal prices of $1 to $1.25 for ordinary bottles. There are different opinions regarding it. Bevreview.com (2010) assumes that Coca Cola BlaK was sold for $1.99 which was too pricy for its target customers, described as over-30 savvy sophisticated achiever. This lesson illuminates that price is one of the most important market element and one critical marketing mix which can decide whether a firm can win the market or not. Coca Cola company segmented the market effectively, identified hidden opportunities for a drink for adults 30-over savvy consumers and targeted them with successful advertising campaigns and positioning strategies. But, Farr (2007) wrote that BlaK is an example for new product development which can either be a hit or a miss-affair. One reason behind this fail was its taste which was behind BlaK’s demise. It was not for every one as it was tasting ‘syrupy’. Conclusion This paper has highlighted the marketing concepts and basic principles of segmentation, targeting and positioning strategies in relation to the example of Coca-Cola BlaK. The STP strategy has been analyzed and studied in relation to the Coca Cola BlaK brand which came in to market in 2006 and disappeared in 2008. The paper concluded that this brand, though developed through heavy spending on research and with effective STP strategies, failed either due to its heavy price as compared to its other brands or its taste like ‘syrupy’. References bevreview.com (2010), Discontinued- Coca Cola BlaK, bevreview.com, Retrieved from http://www.bevreview.com/2007/08/31/discontinued-coca-cola-BlaK/ Bygrave, W. D and Zacharakis, A, (2010), Entrepreneurship, Second edition, John Wiley and Sons Farr, A (2007), ANALYSIS: Coca Cola BlaK to the drawing board, just-drinks.com, Retrieved from http://www.just-drinks.com/analysis/coca-cola-blak-to-the-drawing-board_id91450.aspx Ferrell, O.C and Hartline, M.D (2008), Marketing Strategy, Fourth edition, Cengage Learning Hiebing, R.G, Hiebing, R and Cooper, S.W, 2004, The one-day marketing plan: organizing and completing a plan that works, Third edition, McGraw-Hill Professional Lamb, C.W, Hair, J. F and McDaniel, J. C (2008), Essentials of Marketing, Sixth edition, Cengage Learning Lancaster, G and Reynolds, P ( 2001), Marketing: the one-semester introduction, Illustrated edition, Butterworth-Heinemann Loudon, D. L, Stevens, R. E and Wrenn, B, (2004), Marketing Management: Text and Cases, Illustrated edition, Routledge Rafinejad, D (2007), Innovation, product development and commercialization: case studies and key practices for market leadership, Illustrated edition, J. Ross Publishing Singleservecoffee.com, 2006, Coca Cola BlaK: Single Serve Coffee Meets Single Serve Coke, Single Serve Coffee, Retrieved 03/11/2010 from http://www.singleservecoffee.com/archives/005471.php Schultz D.E and Schultz H.F (2004), IMC, the next generation: five steps for delivering value and measuring returns using marketing communication, illustrated edition, McGraw Hill Professional Stone, M. A and Desmond, J (2007), Fundamentals of Markets: A Critical Evaluation, Illustrated edition, Taylor & Francis USC Marshall, 2010, Promotion: Integrated Marketing Communication, USC Marshall, Retrieved from http://www.consumerpsychologist.com/intro_Promotion.html Wilbert, C, 2006, Coca-Cola BlaK hits stores this week, The Oxford press, Retrieved 03/11/2010 from http://www.oxfordpress.com/e/content/shared/money/stories/coxnews/COKE_BLAK_0404_COX.html Read More