Marketing Presentation on Coca Cola


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Marketing Presentation on Coca Cola

  1. 1. . Presented By: Aishwarya Jain Payal Jain Bhawna Gandhi Shubham Kakkar
  2. 2. Contents: i. Brief Introduction of Marketing Plan i. Objectives of Marketing Plan ii. Mission statement of Coco- cola iii. Objectives of marketing plan iv. Execution summary v. Market share vi. Objectives of the company vii. Current market situation in India viii. SWOT Analysis ix. Marketing strategy – Marketing mix x. Implementation xi. Budgets xii. Issues and initiatives xiii. Suggestions
  3. 3. Introduction of the Company •Founded in 1892 after the formula was invented by Pharmacist John S. Pemberton •Headquartered at Atlanta, Georgia-USA •Currently offers more than 500 brands in over 200 countries •Provides 1.7 billion servings a day •Of this Coca Cola(Coke) accounts for nearly 78% •Sales distributed as follows: 42%(USA), 38%(Mexico, India, Brazil, Japan and China), 20%(Rest of the World) •Financial Details : Revenue US$ 35.119 billion Operating income US$ 8.449 billion Net income US$ 11.809 billion Total assets US$ 72.921 billion Total equity US$ 31.317 billion •Employees: 1,39,600
  4. 4. Fun Fact 1:3.1% of all beverages consumed around the world are Coca-Cola products Of the 55 billion servings of all kinds of beverages drunk each day (other than water), 1.7 billion are Coca-Cola
  5. 5. • Our mission statement is to maximize shareowner value over time. • In order to achieve this mission, we must create value for all the constraints we serve, including our consumers, our customers, our bottlers, and our communities. The Coca Cola Company creates value by executing comprehensive business strategy guided by six key beliefs: 1. Consumer demand drives everything we do. 2. Brand Coca Cola is the core of our business 3. We will serve consumers a broad selection of the nonalcoholic ready-to–drink beverages they want to drink through out the day. 4. We will be the best marketers in the world. 5. We will think and act locally. 6. We will lead as a model corporate citizen. The Mission Statement of the Coca Cola Company
  6. 6. • The ultimate objectives of our business strategy are to increase volume, expand our share of worldwide nonalcoholic ready to drink beverages sales, maximize our long-term cash flows, and create economic value added by improving economic profit. • • The Coca Cola system has more than 16 million customers around the world that sells or serves our products directly to consumers. We keenly focus on enhancing value for these customers and helping them grow their beverage businesses. We strive to understand each customer’s business and needs, whether that customer is a sophisticated retailer in a developed market a kiosk owner in an emerging market. • • There are nearly 6 million people in the world who are potential consumers of our company’s product. Ultimately, our success in achieving our mission depends on our ability to satisfy more of their beverage consumption demands and our ability to add value for customers. We achieve this when we place the right products in the right markets at the right time.
  7. 7. Fun Fact 2:Coke makes so many different beverages that if you drank one per day, it would take you over 9 years to try them all. Coca-Cola has a product portfolio of more than 3,500 beverages (and 500 brands), spanning from sodas to energy drinks to soya-based drinks
  8. 8. Introduction of Marketing Plan •A part of business plan •Most marketing plans cover one year •General to specific : Vision to mission & then down to the individual action plans •The most important output of marketing process.
  9. 9. Objectives of Marketing Plan •To set realistic & unambiguous goals. •To develop an action plan for achieving these goals. •To align the marketing activities with corporate mission. •To respond to rapidly changing market conditions. •To quantify the outcome of each activity.
  10. 10. Executive Summary •Doubling the revenues by 2020 •Making a positive difference in the communities •Project the company as a responsible corporate citizen a) Sustainable water use & packaging b) Climate protection •Lift the corporate brand image •Connect with global middle class by creating new products and packaging formats for all lifestyles and occasions.
  11. 11. Fun Fact 3:Coca-Cola's $35.1 billion in revenue makes it the 84th largest economy in the world, just ahead of Costa Rica
  12. 12. • MARKET SHAREMARKET SHARE: Being the biggest company in the soft drink industry, Coca Cola enjoys the largest market share. This company controls about 59% of the world market. • GLOBAL MARKET SHAREGLOBAL MARKET SHARE:: The following table can show the worldwide operating segments. Unit case growth Non- alcoholic drink All commercial Beverages 10 year compound annual growth 5-year compound annual growth 2001 annual growth 2002 2002 Compan y Industry Compan y Industry Compan y Industry Company share Compan y share Compan y per capita Income 6% 5% 5% 5% 4% 4% 18% 9% 70
  13. 13. • This shows that the market of the company is geographically vast and it is controlling it with great success. In 2002, the company grew their carbonated soft- drink business by nearly 250 million unit cases and generated record volumes. Because carbonated soft drinks are the largest growth segment within the nonalcoholic ready-to-drink beverage category measured by volume, that is why they are focusing more on this and they are continually increasing the pace because they know that accelerating this pace is crucial to their future success. Thus they are increasing their market day by day. The operation income earned by Coca Cola Company can be illustrated by the following pie chart.
  14. 14. • This strategy has worked a lot and it has helped them to become the World’s leading Soft Drink Company. The global unit sale of the Coca Cola Company is increasing from the last ten years. The data of the global unit sale of the Coca Cola Company can be represented by following chart. 0 2 4 6 8 10 12 1971 1981 1991 2002 unit sale in billions So there is positive growth in the market of the Coca Cola Company. There is a worldwide volume increase by 4% with strong international growth of 5%. This is only due to the innovative marketing programmers, which has deepened the relationship of the customers and Coca Cola. The financial health and success of their bottling partners is a critical component of The Coca-Cola Company's ability to build and deliver leading brands.
  15. 15. Objectives of the Company Mission: •To Refresh the World... In body, mind, and spirit •To Inspire Moments of Optimism…Through our brands and our actions •To Create Value and Make a Difference... Everywhere we engage. Vision for 2020 Sustainable Growth: •PROFIT: Maximizing return to shareowners while being mindful of our overall responsibilities. •PEOPLE: Being a great place to work where people are inspired to be the best they can be. •PORTFOLIO: Bringing to the world a portfolio of beverage brands that anticipate and satisfy peoples’ Desires and needs. •PARTNERS: Nurturing a winning network of partners and building mutual loyalty. •PLANET: Being a responsible global citizen that makes a difference
  16. 16. Fun Fact 4:The Coca-Cola brand is worth an estimated $74 billion: more than Budweiser, Pepsi, Starbucks and Red Bull combined
  17. 17. Current Market Situation in India •The carbonated drinks market is close to Rs 6,000 crore ($1.36 billion) with growth at 10-12 per cent •The fruit juices and fruit-based drinks market is close to Rs 5,000 crore ($1.13 billion), growing at 35-40 per cent annually. •Within the hot beverages category, India is the largest producer of tea and accounts for 28 per cent of the global production at 956 million kilograms annually. •The total turnover of the tea industry is over Rs 8,000 crore ($ 1.8 billion), growing at a rate of 1.2 per cent annually. •India is the world’s 5th largest producer of coffee, accounting for 4 per cent of the world’s production. •In India, Coca Cola and Pepsi hold a market share of 95% of which coca cola has 60.8% the rest belongs to Pepsi. Main Indian Competitors: Pepsi Co.-Pepsi, Slice, Dew, Mirinda, Tropicana Juice, Lipton Tea Nestlé-Nestea and other Milk Related Products. Dabur-Real Fruit juice
  18. 18. Products To Offer in Current Market Situation Aerated Drinks Coca Cola Diet Coke Sprite Thums up Maaza Limca Kinley Soda Juices Minute Maid Iced Tea Nestea Water Kinley Water Tonic Water Schwepps Energy Drink Burn Canned Coffee Georgia
  19. 19. Fun Fact 5:If every drop of Coke ever produced were put in 8-ounce bottles and laid end-to-end, they would reach the moon and back over 2,000 times
  20. 20. Fun Fact 6:If you stacked up Coke's 2.8 million vending machines, they would take up 150.2 million cubic feet of space -- the size of 4 Empire State Buildings
  21. 21. SWOT Analysis of Company Strengths: •Strong Brand Name •Corporate Identity •Global Distribution •Advertisement •Innovation •Local Approach •Strong R&D •Backward Integration •“Thanda Matlab Coca Cola” •Brand Loyalty •Financial Stability
  22. 22. SWOT Analysis of Company Weaknesses: •Not No 1 In India •Market Share •Under Utilization Of Capacity •Sales In India •Pesticide Controversy
  23. 23. SWOT Analysis of Company Opportunities: •Developing A Global Brand •Coca Cola’s Bottling System •Sufficient Capital •Has A Potential •Expansion Into New Market •Possible Growing Demand •Merge
  24. 24. SWOT Analysis of Company Threats: •Competition Pepsi •Substituted •Not Necessarily Married •Pesticide Matter •Change Of Taste
  25. 25. Marketing Strategy Marketing Mix: •Product Line •Quality •Brand Name •Logo •Packaging Product:
  26. 26. • The product range of Coca-Cola includes: – Coca-Cola, – Coca-Cola classic, – caffeine free Coca-Cola, – diet Coke – caffeine free diet Coke, – diet Coke with lemon – Vanilla Coke, – diet Vanilla Coke, – Cherry Coke, – diet Cherry Coke, – Fanta brand soft drinks, – Sprite, – diet Sprite – Sprite Remix
  27. 27. • Product Lifecycle of Coke: • Product life cycle has four phases • 1. Introduction • 2. Growth • 3. Maturity • 4. Decline. COCA-COLA
  28. 28. • The markets where Coke is a dominant player are United States of America, Europe and Asia, Africa. There is a vast difference in terms of above given phases for example, in U.S.A & Europe it has reached maturity stage where it can’t expand its market more but if we consider Asia, it is still in the growth phase. • Coca-Cola is currently going through the maturity stage in Western countires. This maturity stage lasts longer than all other stages. Management has to pay special attention to products during this stage of the product life-cycle. During the maturity stage, products usually go through a slowdown in sales growth. According to Coca- Cola's 2001 annual report, sales have increased by 1.02% compared to last year. This percentage has no comparison to the high level of growth Coca-Cola enjoyed during its growth stage. To add a little variation Coca-Cola took the Coca-Cola Classic and added variations to it, including Cherry Coke, Vanilla Coke and Diet Coke. Also Coca-Cola went from 6-oz. glass bottles to 8-oz. cans to plastic liter bottles, all helping increase consumption.
  29. 29. Fun Fact 7:The red and white Coca-Cola logo is recognized by 94% of the world's population
  30. 30. •Modulation in Prices •Psychological Pricing •Penetration Method Price:
  31. 31. • Like any company who has successfully endured a century of existence, Coca- Cola has had to remain tremendously fluent with their pricing strategy. They have had the privilege of a worthy competitor constantly driving them to be smarter, faster, and better. A quote from Pepsi Co's CEO "The more successful they are, the sharper we have to be. If the Coca-Cola Company didn't exist, we'd pray for someone to invent them." states it simply. The relationship between Coca-Cola & Pepsi is a healthy one that each corporation has learned to appreciate. • Throughout the years Coca-Cola has made many pricing decisions but one might say that their ultimate goal has always been to maximize shareholder value. As cola consumption has decreased in the US colas have come to realize the untapped international market. In 2003 both Coke and Pepsi had a solid presence in India and had each introduced a 300mL bottle. In order to grab market share Pepsi began to drop prices (even with summer approaching, which was contrary to policy in America). Shortly thereafter, Coca- Cola decided to drop their prices slightly, but focused on the reduced price point of their 200mL container. Coca- Cola planned to use the lower price point to penetrate new cities that were especially price sensitive. The carbonated soft drink market in India is nearly 37% of the total beverage market there.
  32. 32. • This low price strategy was not unfamiliar to Coca-Cola. Both Coke & Pepsi utilized a low price strategy in the early 1990s. After annihilating the low price store brands, Coke chose to reposition itself as a "Premium" brand and then raise prices. • Coca-Cola products would appear, on the shelf, to have the most expensive range of soft drinks common to supermarkets, at almost double the cost of no name brands. This can be for several reasons apart from just to cover the extra costs of promotions, for which no name brands do without. It creates consumer perceptions and values. When people buy Coca-Cola they are not just buying the beverage but also the image that goes with it, therefore to have the price higher reiterates the fact that the product is of a better quality than the rest and that the consumer is not cheap. This is known as value-based pricing and is used by many other industries in attracting consumers. • In India, the average income of a rural worker is Rs.500 a month. Coca Cola launched a 200 ml bottle for just Rs.5, an affordable amount on the pockets of the rural audience.
  33. 33. Fun Fact 8:Around the world, the average person consumes a Coke product every four days
  34. 34. •Intensive Distribution Strategy •Warehouse & Delivery •Marketing Channels •Coverage Place:
  35. 35. • Coca-Cola entered foreign markets in various ways. The most common modes of entry are direct exporting, licensing and franchising. • Besides beverages and their special syrups, Coca-Cola also directly exports its merchandise to overseas distributors and companies. Other than exporting, the company markets internationally by licensing bottlers around the world and supplying them with the syrup needed to produce the product. • There are different types of franchising. The type that is used by Coca-Cola Company is manufacturer-sponsored wholesaler franchise system. It is very comparable to licensing but the only difference is that the finished products are sold to the retailers in local market. • Coca Cola has managed their company’s marketing and sales strategy within channels. Have you ever considered the significance of the Coke vending machine to the success and profitability of the Coca Cola company? This channel is direct to consumer and vending machines often have little to no competition and no trade or price promotions.
  36. 36. • The Coke Company operates three primary delivery systems for its business channels: • – Bulk delivery for the channels of large Supermarkets, Mass Merchandisers and Club stores; – For smaller channels Coke does advanced sale delivery for convenience stores, drug stores, small supermarkets and on- premise fountain accounts. – Full service delivery for its full service vending customers. • Key Channel Listing – Supermarkets – Convenience Stores – Fast Food – Petroleum Retailers – Chain Drug Stores – Hotels/Motels/Resorts – Mass Merchan-disers – Vending •
  37. 37. • In 2006, the Company began changing its delivery method for its route delivery system. Historically, the Company loaded its trucks at a warehouse with products the route delivery employee would deliver. The delivery employee was responsible for pulling the required products off a side load truck at each customer location to fill the customer's order. Coke began using a new CooLift® delivery system in 2006 in a portion of the Company's territory which involves pre-building orders in the warehouse on a small pallet the delivery employee can roll off a truck directly into the customer's location. The CooLift® delivery system involves the use of a rear loading truck rather than a conventional side loading truck. Coke will continue to rollout this program over the next several years since they expect such significant savings and more efficient deliverys. This is a huge investment for Coke. • The company works through independent bottlers of Coke. They work in coordination with the Coke company which produces the 'secret formula concentrate' and ships to the distributors and bottlers for final processing and packaging prior to shipment to the stores. • Coca-Cola floods all possible retailing stores in satisfying the third part, place. In supermarkets and convenient stores, Coca-Cola products are always easy to identify, and usually make up the greater proportion of options to buy. This increases their market exposure through effective use of the retailers. For a FMCG it is important that they can be found and purchased easily. With many automatic Can machines located in many sports stadiums and shopping malls, you don't even need to go to a store to buy a drink. This greatly enhances the speed of purchase.
  38. 38. • The company produces concentrate, which is then sold to various licensed Coca-Cola bottlers throughout the world. The bottlers, who hold territorially exclusive contracts with the company, produce finished product in cans and bottles from the concentrate in combination with filtered water and sweeteners. The bottlers then sell, distribute and merchandise Coca-Cola in cans and bottles to retail stores and vending machines. Such bottlers include Coca-Cola Enterprises, which is the largest single Coca-Cola bottler in North America and Western Europe and food service distributors. • The Coca-Cola Company only produces a syrup concentrate, which it sells to various bottlers throughout the world who hold Coca-Cola franchises for one or more geographical areas. The bottlers produce the final drink by mixing the syrup with filtered water and sugar (or artificial sweeteners) and then carbonate it before filling it into cans and bottles, which the bottlers then sell and distribute to retail stores, vending machines, restaurants and food service distributors. • The Coca-Cola Company owns minority shares in some of its largest franchises, like Coca-Cola Enterprises, Coca-Cola Amatil, Coca-Cola Hellenic Bottling Company (CCHBC) and Coca-Cola FEMSA, but fully independent bottlers produce almost half of the volume sold in the world. Since independent bottlers add sugar and sweeteners, the sweetness of the drink differs in various parts of the world, to cater for local tastes.
  39. 39. •Advertisements: •Print Advertisements •Radio Advertisements Promotion:
  40. 40. • .
  41. 41. Implementation-Brand Localization Strategy India A(4%):“Life Ho To Aisi” •This segment sought social bonding as a need and responded to inspirational messages, celebrating the benefits of their increasing social and economic freedoms. India B(96%):“Thanda Matlab Coca-Cola” •Use of Idiomatic expressions and Local language •Accessibility Campaign •Distribution Infrastructure: Retail Outlets Doubled in 2 yrs. (From 80,000 to 160,000) •Doubled the Market Penetration in rural areas (13% to 26%) •Campaign of the Year(2003), Advertiser of the Year(2003)
  42. 42. Fun Fact 9:Coca-Cola spends more money on advertising than Microsoft and Apple combined Coca-Cola advertising budget (2010): $2.9 billion Microsoft advertising budget (2010): $1.6 billion Apple advertising budget (2010): $691 million
  43. 43. Implementation through Advertising: Brand Ambassadors: Coca Cola: Imran Khan(Endorsement Fee:3.35 cr) Aamir Khan(Endorsement Fee:10 cr) Virendar Sehwag Thums up-Akshay Kumar(Endorsement Fee: 5 cr) Fanta-Genelia D’souza (Fee: 1.13 cr) Sprite-Shahrukh Khan Sponsorships: First Commercial Sponsor of Olympic Games in 1928 Fifa World Cup(Since 1978) Major League Baseball, NBA, NHL. 1996 Cricket World Cup IPL: Delhi Daredevils English Football League(Coca Cola Championship, League 1, 2)
  44. 44. Implementation through Advertising: Mass Media: Hollywood Movies : Borat, Click, Failure to Launch, Glory Road, Gridiron Gang, Hostel, Mission: Impossible III, Silent Hill, The Covenant, The Departed Bollywood Movies: Kaho Naa Pyar Hai, Rang De Basanti, Taal, Shree 420, Kuch Naa Kaho, Bobby. Campaigns & Collaborations: • Domino’s • Coke Studio with MTV • Diwali Campaign: “Come Home on Deepawali” • “Brrrrrr” Campaign
  45. 45. Budgets Coca Cola has an global annual advertising budget of $1.6 billion a year. 2011-12 Q1 Highlights(Coca Cola India): Total Sales:$356.9 million Operating Income:$19.2million Net Profits:$6.4million Earning per Share:$1.69 Current Trading Price:$63.70 Return on Equity:30.9% Return on Assets:15.1% Return on Invested Capital:25.1% Gross Profit Margin:68.4%
  46. 46. Issues and Initiatives in India •Groundwater Depletion – The Issue: Several droughts in a number of villages in Kerala and Uttar Pradesh where the plants operated were linked as a possible cause due to the large usage of water for production. – The Initiatives: • Reduce • Recycle • Replenish – The Results: • Water usage ratio reduced by more than 25% from 2004-2009 • Waste water treated to a level to support aquatic life • Rainwater harvesting potential equal to 93% of ground water used.
  47. 47. Issues and Initiatives in India •The Pesticide Controversy: – The Issue: in 2006, CSE established that Coke had 25 times the pesticide residue than found in 2003 which posed health risks, which also resulted in a 11% drop in sales. – The Initiative via Advertisements.
  48. 48. Initiatives in India
  49. 49. Suggestions •Cost efficiency: To get the achievement of cost efficiency we have to keep certain points in our mind they are resale of scraps, inventory management, work distribution. •Profit generation: In the SWOT analysis we have seen there is a great opportunity products, these can be turnkey for the company. The company should try to work on export. They should lay more emphasis on export. •Improving technology: There is no doubt that the product of company is not good. But from time to time the regular improvement of the technology. It improves the quality of the product as well as save the time. •Becoming a global player: With the last dealings we can conclude that the company had satisfy there maximum customers. After those dealings the company should try to get a good name in India as well as in international market.
  50. 50. Thank You