Marketing Plan of Coca-Cola - Case Study Example

Running head: MARKETING PLAN OF COCA- COLA Marketing Plan Coca-Cola s Executive summary Coca Cola is basically a beverage company which has nearly 6 million people in the world who are potential consumers of company’s product. Ultimately, the success in achieving the company’s mission depends on its ability to satisfy more of their beverage consumption demands and ability to add value for customers. This is only achievable when Coca Cola place the right products in the right markets at the right time. Market Analysis: The market analysis investigates both the internal and external business environment. It is crucial for Coca cola to carefully examine both the internal and external aspects concerning it’s business as both environments will have influential traits in relation to Coke’s success and survival in the soft drink industry. Internal Business Environment: The main attributes in the internal environment include efficiency in the production procedure, management skills and effective communication channels. Coke must conduct continual appraisals of the business’s operations and readily act upon any factors, which cause inefficiencies in any phase of the production and consumer process. External Business Environment: The influences of external business environment are strong forces which can determine the whole economy and industry. If Coca cola changes it’s some or all the external business environment it should be attentive to its consequences. Changing economy, prices and demographic patterns changes the customer attitudes by which the promotion of Coca Cola is influenced and the likeness of the product is affected. SWOT Analysis: Strengths Weakness Opportunities Threats (SWOT) analysis is a technique which is used in many universal administration and promotion scenarios. SWOT consists of investigative the current activities of the organization - its Strengths and Weakness- and then using this and external research data to set out the Opportunities and Threats that exist. Strengths: Coca-Cola has been a multipart of world society for an extensive time. The products image is loaded with sentimentality, and this is an icon people have accepted sincerely. The Coca-Cola representation is displayed on T-shirts, hats, and collectible memorabilia. This very unusual branding is one of Coca-Colas peak strengths. "Enjoyed more than 685 million times a day around the world Coca-Cola stands as a simple, yet powerful symbol of quality and enjoyment" (Allen, 1995). Moreover, Coca-Colas bottling method is one of their greatest strengths. It permits them to promote their business on a global scale while at the same time uphold a local approach. The bottling companies are locally owned and operated by independent business people who are authorized to sell products of the Coca-Cola Company. Because Coke does not have outright ownership of its bottling network, its main source of revenue is the sale of concentrate to its bottlers. Weaknesses: Weaknesses for any business need to be both minimized and monitored in order to effectively achieve efficiency and effectiveness in their business’s actions, Coke is no omission. Although domestic business as well as many international markets are flourishing (volumes in Latin America were up 12%), Coca-Cola has recently reported some "declines in unit case volumes. Opportunities: Brand recognition is the major factor affecting Cokes viable position. Coca-Colas trademark is known well all the way through 94% of the world today. The most important concern over the past few years has been to get this trade name to be even more known. Packaging changes have also affected sales and business positioning, but in universal, the public has tended not to be affected by new foodstuffs. Coca-Colas bottling system also allows the company to take benefit of endless growth opportunities around the world. This tactic gives Coke the opportunity to examine a large geographic, diverse area. Threats: Currently, the threat of new probable competitors in the fizzy soft drink industry is not very considerable. The risk of substitutes, however, is a very real threat. The soft drink industry is very strong, but clients are not essentially committed to it. Probable substitutes that constantly put stress on both Pepsi and Coke include tea, coffee, juices, milk, and hot chocolate. Even though Coca-Cola and Pepsi are in command of nearly 40% of the entire beverage market, the varying health-consciousness of the market could have a stern affect. Of course, both Coke and Pepsi have already diversified into these markets, premising them to have further noteworthy market shares and counterbalance any sufferers incurred owing to fluctuations in the market. Consumer buying power also represents a key threat in the business. Marketing Strategy The advertising tactic enables Coke to pay attention to all the voices around the world asking for beverages that cover the entire range of tastes and occasions. What people want in a beverage is a reflection of their personalities, culture, nationality, behaviour and routine. Marketing Objectives The objective is the initial point of the marketing plan. Objectives should search for answer to the question What is the aim?”’ The purposes of objectives include: -> to enable a company to control its marketing plan. -> To help to inspire individuals and teams to reach a common goal. -> To provide an agreed, steady focus for all functions of a group. All objectives should be SMART i.e. Specific, Measurable, Achievable, Realistic, and Timed. Selecting Target Market Once the aim and the marketing objective is specified, minds turn towards the target market. There are four broad ways which Coca Cola can segment its market: -> Mass marketing -> concentrated marketing -> Differentiated marketing -> position marketing Developing the Marketing Mix: The marketing mix is the most crucial part of the marketing plans, as it is where the marketing scheme is determined for each and every product. The marketing mix is a combination of four P’s which are price, promotion, product and place which are the core of a marketing strategy. The internal and external factors of the coca cola are monitored to maximize their marketing mix components. Product Products are usually those objects which you can own but the same word mean more than just belongings. In the view of marketing, the word product is used for the outcome of an action or to enjoy the beneficial result without owning the service. Before staging a business, it should think about the outcome of the business on three different stages. 1. Core product 2. actual product 3. Augmented product. The actual product is the features which deliver the core product. Consumers will buy the coke product because of the high standards and high quality of the Coca Cola products. The augmented product is the extra consumer benefits and services provided to customers. Since soft drinks are a consumable good, the augmented level is very limited. Positioning: Once a business has decided which segments of the market it will compete in, developed a clear picture of its target market and defined its product, the positioning strategy can be developed. Positioning is the process of creating, the image the product holds in the mind of consumers, relative to competing products. Coca Cola and Franklins both make soft drinks; although Franklins may try to compete they will still be seen as down market from Coca Cola. Positioning helps customers understand what is unique about the products when compared with the competition. Coca Cola plan to further create positions that will give their products the greatest advantage in their target markets. Coca Cola has been positioned based on the process of positioning by direct comparison and have positioned their products to benefit their target market. Branding It is actually hard to understand why consumers buy certain products over others. The popularity of the brand is often the deciding factor. Over the time Coca Cola has spent millions of dollars developing and promoting their brand name, resulting in world wide recognition. Coca-Cola is the most recognized trademark, familiar by 94% of the worlds population and is the most widely renowned word after "OK". Coca Cola’s red and white colours and special writing are all examples of world-wide trademarks. Basically Coca-Cola listens to all the voices around the world asking for beverages that span the entire spectrum of tastes and occasions (Foust, 2005). There are a number of branding strategies: Generic brand strategy, Individual brand strategy, Family brand strategy, Manufacturer’s brand strategy, Private brand strategy and Hybrid brand strategy. Packaging Packaging, which is not as highly perceived by businesses, is still an important factor to examine in the marketing mix. Packaging protects the product during transportation, while it sits in the shelf and during use by consumers; it promotes the product and distinguishes it from the competition. Packaging can allow the business to design promotional schemes, which can generate extra revenue and advertisements. Coca-Cola has benefited from packaging the product with incentives and endorsements on the labelling as a promotional strategy to increase its volume of sales and revenue. Price Price is a very important part of the marketing mix as it can affect both the supply and demand for Coca Cola. The price of Coca Cola’s products is one of the most important factors in a customer’s decision to buy. Price will often be the difference that will push a customer to buy our product over another, as long as most things are fairly similar. For this reason pricing policies need to be designed with consumers and external influences in mind, in order to effectively achieve a stable balance between sales and covering the production costs. Price strategies are important to Coca Cola because the price determines the amount of sales and profit per unit sold. Businesses have to set a price that is attractive to their customers and provides the business with a good level of profit (Geoffrey; 191-192) Coca cola company should give more incentives to middle men or retailers in way a that they offer them free samples and free empty bottles, by this these retailers and middle man push their product in the market, so that coca cola can be seen more in the market. And have a good sale in the market because according to the expert which product seen more in the market that sells more, basically a strategy to give incentives to retailers and distributors. “Seen as sold”. Promotion: In today’s competitive environment, having the right product at the right place in the right place at the right time may still not be enough to be successful. There should be Effective communication with the target market is essential for the success of the product and business. There are various ways to promote a product such as Getting Shelves, placing products on eye catching positions, boost sales through sales promotion, UTC scheme i.e. “Under the Crown Scheme”, coca cola often do this type of scheme and they offer very handy prizes in it. Like once they offer bicycles, caps, TV sets, cash prizes etc. Promotion is the p of the marketing mix designed to inform the marketplace about who you are, how good your product is and where they can buy it. Promotion is also used to persuade the customers to try a new product, or buy more of an old product. The promotional mix is the combination of personal selling, advertising, sales promotion and public relations that it uses in its marketing plan (Tistion, 2008). Above the line promotions refers to mainstream media: Advertising through common media such as television, radio, transport, and billboards and in newspapers and magazines. Because most of the target is most likely to be exposed to media such as television, radio and magazines, Coca Cola has used this as the main form of promotion for extensive range of products. Place and Distribution: The place P of the marketing mix refers to distribution of the product- the ways of getting the product to the market. The distribution of products starts with the producer and ends with the consumer. One key element of the “Place/Distribution” aspect is the respective distribution channels that Coca Cola has elected to transport and sells its product. There are four types of distribution strategies that Coca Cola could have chosen from, these are: intensive, selective, exclusive and direct distribution. It is apparent from the popularity of the Coca Cola’s product on the market that the business in the past used the method of intensive distribution as the product is available at every possible outlet. From supermarkets to service stations to your local corner shop, anywhere you go you will find the Coca Cola products. BUDGET Financial forecasts are predictions of future events relating strictly to expected costs and revenue costs for future years. There are five major marketing expenditures, which include research costs, product development costs, product costs, promotion costs and distribution costs. Sales force amalgamated is the most rational method in forecasting revenue. This involves estimates from individual salespeople to sell to work out a total for the whole business. Once these costs and revenues are forecasted, management can then decide which blend of marketing mix strategies will bring the most sales revenue at the lowest cost. Implementation: Implementation is the process of turning plans into actions, and involves all the activities that put the marketing plan to work. Successful implementation depends on how well the business blends its people, organizational structure and company culture into a cohesive program that supports the marketing plan. For its further success, Coca Cola must impose several key changes. Production needs to be on time and meet the quota demanded from wholesalers. It must also be efficient so as not to build inventory stocks and inventory prices. The marketing needs to be motivated and knowledgeable about the product. The forms of promotion such as advertising must be attracting and enticing to the target market to get the greatest amount of exposure possible for the product. This will ensure the success of the product in the stores. Distribution of the product must be efficient. This problem has already been taken care of with convenient transport routes to commercial areas and transport already being arranged. Monitoring and Controlling: Monitoring and controlling allows the business to check for variance in the budget and actual. This is important because it allows Coca Cola to take the necessary actions to meet the marketing objectives. There are three tools Coca Cola should use to monitor the marketing plan. They are the following: i. Sales Analysis ii. Market Share Analysis iii. Profitability Analysis SUMMARY: This marketing plan basically consists of examining market research, auditing company and current situation (situation analysis) and carefully scrutinizing the soft drink industry and possibilities for Coca Cola in the market. Once we have carefully analyzed the internal and external business environment and critically examined the industry in general the most suitable marketing strategies will be selected and these strategies will be administered by effectively and continually monitoring external threats and opportunities and revising internal efficiency procedures. References Foust D. (2005, 12 December). Why Coke Has Real Problems Retrieved 15th April 2009, from http://www.businessweek.com/bwdaily/dnflash/dec2005/nf20051212_1655_db042.htm Geoffrey J. The evolution of Coca Cola’s Global Marketing Strategy, In Adding value (pg 191-192) Tistion D. (2008, April 2). Learn from the Experts- Coca cola marketing strategy Retrieved 14th April 2009, from http://oftalesandtails.blogspot.com/2008/04/learn-from-experts-coca-colas-marketing.html http://www.bitc.org.uk/resources/case_studies/coca_cola_market.html Read More