Marketing Issues and Solutions: Coca Cola - Case Study Example

XXXX Number: XXXX XXXX XXXX XXXX XXXX Word Count: 1230(Excluding Bibliography) Marketing Issues and Solutions: Coca Cola Introduction: Marketing plays a very important role in every company’s success. There have been a number of companies that have tried various different tricks and styles in marketing to improve the company’s sales and improve the brand image. One such company is Coca Cola. This report aims at understanding the issues that Coca Cola has faced over the years and what steps the company has taken to over come all these issues. The next section will include a brief about Coca Cola. Coca Cola: With the increasing developments in markets and the markets becoming more mature, almost every company is trying to become more interested in the foreign countries. Coca Cola was established in United States of America. It started to grow its markets globally as early as 1919. Coca Cola has been extremely successful with this and is now present in over 200 countries worldwide. Coca Cola is the world’s largest manufacturer of non – alcoholic beverages. The company has been able to create a brand image throughout the world and it is safe to say that with the number of different brands it possesses it is the one which is no stranger to the global consumer. Over the years Coke has used a number of different marketing strategies and has been successful in almost all the cases. Issues faced by Coke: Coca Cola being such a big organization has faced a number of issues with the marketing. Some of the different issues will be discussed here and the strategies that Coke has developed to overcome these issues are also discussed in the next section. One of the biggest issues the company faced was in 2004, when the company’s sales were reducing and the company was starting to face issues as the people became more health conscious and believed that carbonated drinks are bad for health (Scott, 2007). The other major issue that was faced by the company was when complaints were made against the company for marketing the product to school children. This had affected the health of the school going children and was also a big cause for childhood obesity (Warner, 2005). Coke’s Solution: Neville Isdell who was the new CEO of Coke in 2004, Isdell spent hundreds of million dollars to market the carbonated drinks and the new cola innovations. This resulted in the company earning revenues much higher than it had every earned since 1988, despite the fact that the sales in U.S was still declining. Isdell has been believed to use simple steps in the marketing process and techniques. He stuck to five important points while creating the entire strategy for the company’s marketing to overcome the issue of the dropping sales. Firstly, Isdell notes that there was a ‘lack of belief’ among the consumers for carbonated soft drinks and this became a prophecy for the companies when the marketing support and the innovations weakened. The first step that he undertook was the introduction of the Coke Zero along with a lot of marketing. Although this was a carbonated drink, it still did help in reducing the decline of the company. This along with the added marketing acted as a support for the company to help only reduce the decline. Secondly, Isdell also followed one of the expressions used by a former boss – ‘Stand On The Balcony Once In A While’. This basically referred to the idea to forget about the day – to –day issues and to give importance to learning. This was one very useful idea used by Isdell as it allowed Isdell to reaffirm the company’s vision and work on uniting the company’s strategy. Thirdly, a trick followed by Isdell was to define the product himself rather than letting others define the product. He replaced the name carbonated drink with Sparkling Beverage on account of the fact that carbonated drinks were being deemed to be unhealthy. This was an innovative step undertaken by the Isdell to help reposition the product and create a different brand image. Next, Isdell also noted that it would not be beneficial for the company to withdraw from production of carbonated drinks, as it was the core of their business. Even though the company does have a number of different non carbonated drinks as a part of their brand portfolio, they do not earn as much as the core (Brand Sizzle, 2007). Isdell pointed out that withdrawing support from Coke even though it still brought in the majority of the revenues would be the biggest mistake. Lastly, the one point which he noted was to realize the different innovations that can be done with the products. To ensure all the possible innovations are made, he introduced the Coke Zero, which helped realize that no category can be discarded without trying all the innovations, to meet the changing trends and tastes of the consumer. For the case of the school, Coca Cola took this as a very serious issue and steps were taken not to advertise to children below twelve. Coca Cola has been one of the first few carbonated drinks company to withdraw the carbonated drinks vending machines from all schools. The company took this as a very serious matter and ensured that children below twelve did not become a part of the target market. However there have been a few issues that have been unresolved as the company still does run campaigns for school children and provides school children with a number of sponsorships for the play ground, stationeries, etc. Also the campaign does include a number of promotion activities within the schools where the company dress the school play grounds with the colors of Coca Cola, thus spreading the colors into the school. Also the campaign that has been undertaken by the company to promote good dietary habits among the school children has turned into a mode of advertising for the company. This still is violating the government regulation of not promoting or limited promotion of soft drinks among the children (Dump Soda, 2008). Thus in some manners the company has not been able to completely solve this issue, however it is still working on completely stopping any campaigns or marketing that could directly or indirectly in anyway promote soft drinks to children. Conclusion: Coca Cola being one of the biggest producers of soft drinks has always been in the spot light. Thus the company and management ensure all issues of any kind are vey seriously taken and steps are taken to reduce the affect of this at the earliest. The company has used a number of different approaches to solve the issue of marketing soft drinks to children. As mentioned it endeavored to campaign in schools for healthy eating habits, however it has not been completely successful. Also the competitors of the company like Pepsi, etc, did also have to take necessary steps to stop promoting soft drinks to children. The company has seen immense growth under the leadership of CEO Isdell (see graph - appendix). Now that Isdell plans to step down the company requires ensuring that the growth is not affected and it can only do so by following the aggressive marketing strategies. Suggestions: Coca Cola being a very large brand with brand awareness around the world can help improve the situation of the issue by starting a campaign for the children. The campaign should be one where the company hires professional dieticians, physicians, and well trained doctors to increase the awareness of healthy living among children. This would help the company build a brand image of healthy living and will allow the company to grow its revenues. Bibliography Brand Sizzle, 2007. Marketing Strategy: Five thingd The Coca Cola Comapny Can Teach Us. 12 March 2007. 4 December 2008. Dump Soda, 2008, The Coca Cola Company Proudly Claims.. 4 December 2008. Goldmoods, 2008. KO - Coca - Cola Co. 12 April 2008. 4 December 2008. Scott, 2007. Coca - Colas New Marketing Strategy. 23 August 2007. 4 December 2008. Warner, M.,2005. Coke is Urging Youth to get Physical. 12 July 2005. 4 December 2008. Appendix Figure 1: Share turnover, Closing Price, Average Price of Coca Cola (Goldmoods, 2008) Read More