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49045118 project-of-coca-cola-110406035123-phpapp01(4)

  1. 1. Lovely School ofManagementSubmitted To: -Submitted By:-Mr. Sunil Budhi RajaGyan PrakashRoll. No:-B46 Sec tion: - S1007 R eg. Id:-11011236 1
  2. 2. ACKNOWLEDGEMENTAfter completing my IInd semester curriculum. I went for summertraining for 8 weeks duration and it bears inspirit of several person. Ihave achieve this training in one of the most esteemed organizationof the country Hindustan Coca-Cola Beverages Private Limited,Patna for their kind permission to undertaken its study I am gratefulto respected Mr. Vijay Kumar Singh (HR Executive, in Coca-ColaBeverages Private Limited). For their moral support andencouragement throughout my project work. This list will go incompletewithout the special reference of the contribution and whole heartedsupport of manager’s and all other staff and department, which trulyreflect their deep insight into the project and the professional touchwhich is their benchmark. I would like to thanks Mr. Sunil Budhi 2
  3. 3. Raja. Who helped me a lot during this project? My gratitude will notbe completed without thanking my beloved parents who have beena constant source of aspiration & blessing in my pursuit for studies. TABLE OF CONTENTS CONTENTS 1. Mission statement 2. Introduction. 3. Coca Cola. a. Coca Cola International. b. History. 4. Management. 5. EXTERNAL MARKETING ENVIRONMENT 6. Market share. 7. Financial report. 8. Dividends and Cash Plan. 9. Products. 10. Market mix of Coca-Cola 11. Strategic planning. 12. Bottlers owned by Coca cola 13. Coca Cola Pakistan. 14. Major Competitors a. Pepsi b. History. c. Financial assets. • Market share. • Financial report. • Products. 3
  4. 4. • Methodology 15. Some basic information regarding marketing of coke a. Target market: b. Major segments: c. Factors effecting sales: d. Major competitors: e. Strategies of quality: f. Threats from competitors: g. Targets that would like to attain: h. Expanding target market i. Threats and opportunities for price: j. Strategies of getting goals i.e. “high profits”: k. Marketing strategy: l. Expectations for the coming year: m. How coke determine the yearly budget: 16. Marketing strategies 17. Pest analysis.The Mission Statement of the Coca Cola CompanyOur mission statement is to maximize shareowner value overtime.In order to achieve this mission, we must create value for all theconstraints we serve, including our consumers, our customers, ourbottlers, and our communities. The Coca Cola Company createsvalue by executing comprehensive business strategy guided by sixkey beliefs:1. Consumer demand drives everything we do.2. Brand Coca Cola is the core of our business3. We will serve consumers a broad selection of thenonalcoholic ready-to–drink beverages they want to drinkthroughout 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. 4
  5. 5. The ultimate objectives of our business strategy are to increasevolume, expand our share of worldwide nonalcoholic ready todrink beverages sales, maximize our long-term cash flows, andcreate economic value added by improving economic profit.The Coca Cola system has more than 16 million customers aroundthe world that sells or serves our products directly to consumers. Wekeenly focus on enhancing value for these customers and helpingthem grow their beverage businesses. We strive to understand eachcustomer’s business and needs, whether that customer is asophisticated retailer in a developed market a kiosk owner in anemerging market.There are nearly 6 million people in the world who are potentialconsumers of our company’s product. Ultimately, our success inachieving our mission depends on our ability to satisfy more of theirbeverage consumption demands and our ability to add value forcustomers. We achieve this when we place the right products in theright markets at the right time.COCA COLA INTERNATIONALHISTORY:Coca-Cola Enterprises, established in 1886, is a youngcompany by the standards of the Coca-Cola system. Yet eachof its franchises has a strong heritage in the traditions ofCoca-Cola that is the foundation for this Company.The Coca-Cola Company traces it’s beginning to 1886, whenan Atlanta pharmacist, Dr. John Pemberton , began to produceCoca-Cola syrup for sale in fountain drinks. However thebottling business began in 1899 when two Chattanoogabusinessmen, Benjamin F. Thomas and Joseph B. Whitehead , 5
  6. 6. secured the exclusive rights to bottle and sell Coca-Cola formost of the United States from The Coca-Cola Company.The Coca-Cola bottling system continued to operate asindependent, local businesses until the early 1980s whenbottling franchises began to consolidate. In 1986, The Coca-Cola Company merged some of its company-owned operationswith two large ownership groups that were for sale, the JohnT. Lupton franchises and BCI Holding Corporations bottlingholdings, to form Coca-Cola Enterprises Inc. The Companyoffered its stock to the public on November 21, 1986, at asplit-adjusted price of $5.50 a share. On an annual basis, totalunit case sales were 880,000 in 1986.In December 1991, a merger between Coca-Cola Enterprisesand the Johnston Coca-Cola Bottling Group, Inc. (Johnston)created a larger, stronger Company, again helping acceleratebottler consolidation. As part of the merger, the seniormanagement team of Johnston assumed responsibility formanaging the Company, and began a dramatic, successfulrestructuring in 1992.Unit case sales had climbed to 1.4billion, and total revenues were $5 billionThe Coca-Cola Company is the world’s largest beverage company.They operate in more than 200 countries & markets more than 2800beverage products. Head quartered at Atlanta, Georgia, they employapproximately 90500 employees all over the world. It is oftenreferred to simply as Coke or (in European and American countries)as Cola or Pop. 6
  7. 7. MANAGEMENT:The hierarchy of Coca Cola Company is as follows. 7
  8. 8. Chairman Board of governors Vice Chairman and chief operating officer Executive Vice Presidents Senior Vice Presidents Vice PresidentsMARKET SHARE: SHAREBeing the biggest company in the soft drink industry, Coca Colaenjoys the largest market share. This company controls about 59%of the world market.GLOBAL MARKET SHARE:The following table can show the worldwide operating segments. (Table) Unit case growth Non- All alcohol commercial ic Beverages drink10 year 5-year 2001 annual 2002 2002compound compound growthannual annualgrowth growthComp Indus Comp Indus Comp Indus Compan Comp Company try any try any try y share any any share per 8
  9. 9. capita Incom e6% 5% 5% 5% 4% 4% 18% 9% 70This shows that the market of the company is geographically vastand it is controlling it with great success. In 2002, the company grewtheir carbonated soft-drink business by nearly 250 million unit casesand generated record volumes. Because carbonated soft drinks arethe largest growth segment within the nonalcoholic ready-to-drinkbeverage category measured by volume, that is why they arefocusing more on this and they are continually increasing the pacebecause they know that accelerating this pace is crucial to theirfuture success. Thus they are increasing their market day by day.The operation income earned by Coca Cola Company can beillustrated by the following pie chart. (Figure)This strategy has worked a lot and it has helped them to become theWorld’s leading Soft Drink Company. The global unit sale of the CocaCola Company is increasing from the last ten years. The data of theglobal unit sale of the Coca Cola Company can be represented byfollowing chart. 9
  10. 10. (Figure) 12 10 8 6 unit sale in billions 4 2 0 1971 1981 1991 2002So there is positive growth in the market of the Coca Cola Company.There is a worldwide volume increase by 4% with stronginternational growth of 5%. This is only due to the innovativemarketing programmers, which has deepened the relationship of thecustomers and Coca Cola. The financial health and success of theirbottling partners is a critical component of The Coca-ColaCompanys ability to build and deliver leading brands.In 2002, the company had worked with their bottlers to turn goodintentions into reality by improving the system economics. Theresults in 2002 reflect this steadily improving and mutuallyconstructive relationship between the Company and their bottlingpartners. The main reason behind this relationship is to continuerealizing shared opportunities for growth, with closer coordination ofoperations including customer relationships, logistics andproduction.EXTERNAL MARKETING ENVIRONMENT (PEST ANALYSIS)Political Analysis for Coca-ColaNon-alcoholic beverages fall within the food category under the FDA.The government plays a role within the operation of manufacturingthese products in terms of regulations. There are potential fines set 10
  11. 11. by the government on companies if they do not meet a standard oflaws.The following are some of the factors that could cause Coca-Colacompanys actual results to differ materially from the expectedresults described in their underlying companys forward statement:- • Changes in laws and regulations, including changes in accounting standards, taxation requirements, (including tax rate changes, new tax laws and revised tax law interpretations) and environmental laws in domestic or foreign jurisdictions. • Changes in the non-alcoholic business environment. These include, without limitation, competitive product and pricing pressures and their ability to gain or maintain share of sales in the global market as a result of action by competitors. • Political conditions, especially in international markets, including civil unrest, government changes and restrictions on the ability to transfer capital across borders.Political structure and legal considerations also have impinged onCoco-Cola Company’s strategies. Governments of some Arab nationsboycotted Coca-Cola’s products due to a political dispute anddiscontented with the company for maintaining distributors in Israel.Economical AnalysisBeing flexible and willing to change to satisfy consumers’ needs, hasenabled Coca-Cola to exploit the economies of scale that was gainedby its global marketing and at the same time making its productsappeal to local taste, which these have earned the company anenormous profits quarterly.As Coca-Cola has expanded over the decades or even nearly acentury, the company has benefited from the various culturalinsights and perspectives of the societies in which business is done.No doubt of the remarkable experience it has, it is still verycommitted to local markets, to paying attention to what people from 11
  12. 12. different cultures and backgrounds like to drink, and where and howthey like to drink it, to remain competitive and to develop more newdrinks to satisfy its markets.Now, the estimated brand equity of Coca-Cola is $84billion, marketshare of more than 50 percent in beverage industry globally andabout 70 percent of its income comes from countries outside UnitedStates. Every 10 seconds, 126,000 people in the whole world,choose to reach out for one of The Coca-Cola Company brands, andit is the company’s mission to make that choice exciting andsatisfying, every single time.Previously the U.S. economy was strong and nearly every part of itwas growing and doing well. However, things changed. Before theattacks on September 11, 2001, the United States was starting tosee the economy recover slightly and it is only just recently thatthey achieved the economic levels. Consumers are now resumingtheir normal habits, going to the malls, car shopping, and eating outat restaurants. However, many are still handling their moneycautiously. They believe that with lower inflation still to come,consumers will recover their confidence over the next year. Asresearching for new products would cost less the Coca-ColaCompany will sell its products for less and the people will spend asthey would get cheap products from Coca-cola.Social Analysis for Coca-ColaForeign environment factors have influenced the Coca-Cola’sstrategies in international marketing. Culture has a tremendouseffect on people’s preferences and perception. Language is one ofthe aspects of culture that marketers must take care of, in term oftranslating product name, slogans and promotional messages so asnot to convey the wrong meaning. Coca-Cola did not look much intothis aspect when entering into the markets of countries like Chinaand Taiwan as the literal translation of Coca-Cola in Chinesecharacters mean, “bite the wax tadpole”.Changes are necessary in international marketing for consumer’s 12
  13. 13. products, as it is important that the products suit one’s taste,preferences and fulfill one’s needs. Coca-Cola has continuedchanging, improving and developing new drinks to appeal to localtastes.After discovering that Coke did not appeal as much to Japaneseconsumers, Coca-Cola developed over 30 new drinks for theJapanese market, which inclusive of Asian tea, English tea, coffeeand fermented-milk drink.In China, Coca-Cola has also begun the similar strategy ofintroducing beverages developed for the taste buds of local market.It launched a fruit juice drink called Tian Yu Di (Heaven and Earth)specifically for the Chinese market with planning of introducing themarket with a Chinese iced tea and soy milk drink.Many U.S. citizens are practicing healthier lifestyles. This hasaffected the non-alcoholic beverage industry in that many areswitching to bottled water and diet colas instead of beer and otheralcoholic beverages. Also, time management has increased and is atapproximately 43% of all households. The need for bottled waterand other more convenient and healthy products are in important inthe average day-to-day life.Consumers from the ages of 37 to 55 are also increasinglyconcerned with nutrition. There is a large population of the agerange known as the baby boomers. Since many are reaching anolder age in life they are becoming more concerned with increasingtheir longevity. This will continue to affect the non-alcoholicbeverage industry by increasing the demand overall and in thehealthier beverages.Technological Analysis for Coca-ColaSome factors that cause companys actual results to differ materiallyfrom the expected results are as follows: • The effectiveness of companys advertising, marketing and promotional programs. The new technology of internet and television which use special effects for advertising through media. They make some products look attractive. This helps in 13
  14. 14. selling of the products. This advertising makes the product attractive. This technology is being used in media to sell their products. • Introduction of cans and plastic bottles have increased sales for Coca-Cola as these are easier to carry and you can bin them once they are used. • As the technology is getting advanced there has been introduction of new machineries all the time. Due to introduction of this machineries the production of the Coca- Cola company has increased tremendously then it was few years ago • Coca-Cola has six factories in Britain which use the most state- of the-art drinks technology to ensure top product quality and speedy delivery. Europes largest soft drinks factory was opened by CCE in Wakefield, Yorkshire in 1990. The Wakefield factory has the technology to produce cans of Coca-Cola faster than bullets from a machine gunMARKET SHARE BY AREA:Coca Cola is the world-renowned soft drink and the company iscurrently operating throughout the world. The world wide total isabout 17.8 billion.The operation review according to the segments is as follows. Operation Review (2002 worldwide unit case volume by operating segment) NORTH LATIN EUROPE & ASIA AFRICA AMERICA AMERICA MIDDLE EAST 30% 25% 22% 17% 6% 14
  15. 15. NORTH AMERICA LATIN AMERICA EUROPE & MIDDLE EAST ASIA AFRICA So the volume is least in the Africa and most in the North America. The data about the market share of this company area wise is given in the following table. The above table shows the geographical earning of the Coca Cola Company and from this data; we can find out that the customers of Coca Cola are increasing which is shown by the company’s per capita income. Unit case equals 24 eight-ounce servings. The column, which shows the non-alcoholic beverages consist of commercially, sold beverages, as estimated by the Company based on available industry sources. The country column is derived from The Companys unit case volume while the industry column includes nonalcoholic ready-to-drink beverages only, as estimated by the Company based on available industry sources. (Table)Countr Unit case growth Non- All commercial y alcoh Beverages olic Drink s 15
  16. 16. 10 year 5-year 2002 annual 2002 2002 compound compound growth annual annual growth growth Comp Indus Comp Indus Comp Indus Comp Comp Compa any try any try any try any any ny per share share capita IncomeNorth 4 5 3 3 2 2 22 15 398Ameri caUnite 4 5 3 3 2 2 23 16 419 dStates Latin 6 7 6 6 3 4 24 15 205Ameri caArgen 7 4 6 2 7 2 20 10 236 tinaBrazil 5 5 3 6 3 5 23 13 144 Chile 9 6 5 3 (2) 3 56 23 336Mexic 7 10 8 9 2 5 22 18 462 oEurop 6 3 5 3 2 4 12 6 72 e& Mid dle EastEurasi 17 8 6 5 (14) 1 14 5 39 aFranc 8 3 9 3 7 3 9 5 110 eGerm 1 2 (1) 1 (6) 1 14 7 193 anyGreat 8 2 11 2 8 3 17 6 193Britai n Italy 1 3 4 3 2 2 9 6 104Middl 12 12 7 5 4 8 8 3 17e East 16
  17. 17. Spain 6 4 8 5 4 4 17 12 264 Asia 7 6 6 7 10 7 14 5 23Africa 7 6 8 3 10 6 34 11 34 In Asian population, which is the satisfied customer of Coca Cola, is approximately 3.2 billion and the average consumer enjoys close to two servings of our products each month. Through an intense focus on Coca-Cola, innovation and new beverages, the company has achieved volume growth of 10 percent in 2002. With developing economies and populations, this region has strong long-term potential, and the company is building an exciting family of beverage brands in addition to expanding the popularity of our core brands, led by Coca-Cola. In China, for example, sales of Coca-Cola increased 6 percent. The total unit case sale of Coca Cola in Asia can be shown by the following pie chart. (Figure) So the company is emphasizing more in this area and is trying to develop a strategy, which can increase the growth of the consumption of Coca Cola by the people of Asia. Among the countries of Asia, Japan has the highest percentage, which is about 29%. Among others, Pakistan, India and Bangladesh are those countries where the average consumption is increasing day by day. FINANCIAL REPORT: This company is financially very strong. It is due to the strong finances, the company is still surviving the ups and down of the 17
  18. 18. business world. The financial report of Coca Cola Company of theyear 2001 and 2000 along with the percentage change is as follows. (Table) Year Ended December 31, (In millions except per share data, ratios and growth rates) 2002 2001 Percenta ge changeNet operating revenues 20,092 19,889 1%Operating income 5,352 3,691 45%Net income 3,969 2,177 82%Net income per share (basic) 1.601 0.882 82%Net income per share (diluted) 1.601 0.882 82%Net cash provided by operatingactivities 4,110 3,585 15%Business reinvestment (963) (779) 24%Dividends paid (1,791) (1,685) 6%Share repurchase activity (277) (133) 108%Free cash flow 3,147 2,806 12%Return on capital 26.6% 16.2% -Return on common equity 38.5% 23.1% -Unit case sales (in billions) International operations 12.5 11.9 5% North Americaoperations 5.3 5.2 2% Worldwide 17.8 17.1 4%2002 basic and diluted net income per share includes a non-cashgain of $.02 per share after taxes, which was recognized on theissuance of stock by Coca-Cola Enterprises Inc., one of the equityinvestors of this company.2002 basic and diluted net income per share includes the followingcharges: 18
  19. 19. • $.24 per share after income taxes related to an organizational Realignment. • $.19 per share after income taxes related to the Companys portion of charges recorded by the investors of the company. • $.16 per share after income taxes related to the impairment of certain bottling, manufacturing and intangible assets. • $.05 per share after income taxes related to the settlement terms of a discrimination lawsuit. • $.01 per share after income taxes related to incremental marketing expenses in Central Europe.These charges are partially offset by a gain of $.05 per share afterincome taxes related to the merger of Coca-Cola Beverages plc andHellenic Bottling Company S.A. and $.04 per share after incometaxes related to benefits from a tax rate reduction in Germany andfrom favorable tax planning strategies.DIVIDEND AND CASH INVESTMENT PLAN:The Dividend and Cash Investment Plan permits shareowners ofrecord to reinvest dividends from Company stock in shares of TheCoca-Cola Company. The Plan provides a convenient, economicaland systematic method of acquiring additional shares of ourcommon stock. All shareowners of record are eligible to participate.Shareowners also may purchase Company stock through voluntarycash investments of up to $125,000 per year.At year-end, 76 percent of the Companys shareowners of recordwere participants in the Plan. In 2002, shareowners invested $36million in dividends and $31 million in cash in the Plan.COMPANY STATISTICS:The statistics of this company is impressive. Since it is operatingthrough out the world that is why the number of employees and thebottling equipments is highest among the other bottling companies.There is a constant increase in every aspect when we compare thestatistics of 2001 and the statistics of 2002. This is because; Coca 19
  20. 20. Cola Company is increasing its volume day by day. The expansion ofthis company, which shows the success of Coca Cola brands, resultsin the percentage change in the statistics of the two years. Thestatistics is as follows. (Table) 2002ª 2001Equivalent cases 4.2 billion 3.8 billion Bottle and cans 87% 87% Fountain 13% 13%Employees 72,000 67,000Vehicles 54,000 52,000Cold drink equipments 2.4 2.3 million millionFacilities Production only 25 25 Distribution 385 361 Combination 53 50Total 463 436Percent of North America population 80% 72%coverageNumber of States of Operation 46 46Bottle and can equivalent case package distribution Cans 44% 45% Non-refillable bottles 52% 51% Refillable bottles 4% 4%Capital structure Net debt to total capital ratio 63% 59% EBITDA interest coverage 3 3 Weighted average cost of debt 6.3% 6.8%Key StatisticsConstant territory bottle and can volume 3% ½% growth Bottle and can net revenues per case Flat 2% changeBottle and can cost of sales per physical 1 ½% case change Reported EBITDA (in billions) $1.95 $2.39 Reported EBITDA change (18)% 9% 20
  21. 21. Capital expenditures( in billions) $0.97 $1.18 %-age of net operating revenues 6% 8% Coverage of North American Can/bottle 83% 74% volumeEBITDA is the Earnings before interest, taxes, depreciation,and amortization, and other non-operating items. • Net Debt is the Long-term debt plus current portion of long-term debt less cash and marketable securities. • Equivalent Case or Unit Case is the physical case and fountain gallons converted to a standard unit of measure defined as 24 eight-ounce servings or 192 ounces per equivalent case sold by Coca-Cola Enterprises.PRODUCTS:There are different brands of the Coca Cola Company, which arecurrently in use throughout the world. This company not only dealsin the carbonated drinks but also other drinks. While launching itsproduct, the marketing team considers the culture of the country.Major brands of coca cola • Coke • Sprite • Fanta • Diet coke • Coke classicThe overall volume of this company is as follows. (Figure) 21
  22. 22. The commitment of the company is to devote resources to wateronly in markets where it expects profitable growth. This strategy haspaid dividends. The company has successfully applied it’s approachto brands in several key markets, including Ceil in Mexico, Mori NoMizudayori in Japan, Bonaqua in Russia and Kinley in India. Backedby a strong network of bottling partners through out the UnitedStates, Dasani became the nations fastest-growing water brand. InEurasia, the entire Turkuaz brand team worked together to launchTurkeys first purified water brand. This year, Coca-Cola Companyalso successfully energized a major piece of its beverage strategy—water. By the end of 2001, it’s bottled water volume exceeded 570million unit cases, making it the second biggest contributor to thegrowth of the company after carbonated soft drinks. Three of thewater brands, Dasani, Ciel and Bonaqua each achieved sales of over100 million unit cases for the year.In 2001and 2002, the company has also made good progress incoffees and teas. Beverage Partners Worldwide, the renewed andstrengthened marketing partnership with Nestlé S.A., beganoperations in 2001. This partnership combines Nestlés knowledge inlife science, research and development with the expertise of CocaCola Company in brand building and distribution.At the same time, the company grew Georgia coffee in Japan by 3percent through award-winning marketing in a category that wasflat for the year. Also in Japan—where The Coca-Cola Company is the 22
  23. 23. leader in the total tea category, the second-largest category in thenon-alcoholic ready-to-drink segment—it launched Marocha GreenTea. With sales of 46 million unit cases for the year, Marocha GreenTea is the fastest-growing product in the fastest-growing category:green tea. The popularity of Marocha is also recognized by theindustry with a leading trade journal naming Marocha the mostpopular new food and beverage product of the year. Know the most recognized word on the planetafter “OK”!Among the soft drinks Fanta and Sprite become successful alongwith the major brand Coca Cola and Diet Coke. In key markets, thecompany has created new packaging sizes to satisfy consumerdemands.Increasingly, Mexican families have lunch together at home. Theaverage Mexican household drinks two-and-a-half liters or more ofsoft drinks during that break, while a two-liter bottle was the largestavailable package. So the company introduced a convenient 2-½liter bottle to select regions, contributing to the sale of nearly 1.5billion unit cases of Coca-Cola in Mexico this year. This larger bottlewill complete its nationwide rollout in 2002. In China, Coca-Cola is anintegral part of holiday celebrations and the family get-togethersthat accompany such events. Through an intense focus on Coca-Cola, innovation and new beverages, it has achieved volume growthof 10 percent in 2001. In China, sales of Coca-Cola increased by 6percent. In the United States, recognizing that consumers oftenenjoy their diet Coke with a slice of lemon, the company "bottled"the concept. The result—diet Coke with lemon—contributed tovolume growth of 4 percent for the number-one diet. 23
  24. 24. Soft drink in North America: diet Coke. The company increased itstwo largest bottle sizes during the 2001 holidays, and festivalpackaging helped drive a 6 percent volume increase for Coca-Cola.The packaging innovations do not just involve resizing. The companyhas also responded to consumers changing fashion styles with newbottles.With brands such as Minute Maid, Hi-C, Simply Orange and Disneyjuices and juice drinks in the United States, Qoo in Asia, Kapo inLatin America and Bibo in Africa.This year, the company re-launched its global sports-drink business,investing in new products, packaging, positioning and marketing.The results speak for themselves: it’s global sports drinks, led byPowerade and Aquarius, grew by 13 percent in 2002, nearly doublethe growth rate of the worldwide sports-drink category. Revitalizedin the United States, the company introduced Powerade in nearlyevery major Western European market, including Great Britain,Germany and Spain, as well as in Mexico and Latin America. Thecompany launched 27 products in 2001.The commitment of the company to packaging innovation alsoresulted in new initiatives for our fountain business, a channelthrough which many consumers enjoy Coca-Cola. In the UnitedStates, the company developed Fountain, a total beveragedispensing system that is more flexible and more reliable. Two yearsof research resulted in a dispensing system that providesexceptional beverage quality, easy to upgrade technology, brandand graphic customization and improved reliability.MARKETING MIX OF COCA-COLAFirstly, we will look at how Coca-Cola has used their marketing mix.The marketing mix is divided up into 4 parts; product, price,promotions and place. 1. Product: 24
  25. 25. The product (Coca-Cola soft drink) includes not just the liquidinside but also the packaging. On the product-servicecontinuum we see that a soft drink provides little service, apartfrom the convenience. Soft drinks satisfy the need of thirst.However, people are always different, some want more andothers want less. Therefore Coca-Cola has made allowancesfor that by providing many sizes. We also have particulartastes, and again they have provided several options. So,although thirst is what is needed to be satisfied and that is thecore benefit, we are receiving other benefits in the taste andsize. Coca-Cola has developed several different flavours andsizes as mentioned above, but also several brands such asSprite, Lift, Fanta and Diet Coke which increase the product linelength, thus making full use of the market to maximize sales.The product is convenient, that is - bought frequently,immediately, and with a minimum of comparison and buyingeffort.The appearance of the product is eye catching with thebright red colour. It has a uniquely designed bottle shape thatfits in your hand better, and creates a nicer & more futuristiclook.The quality of the soft drink is needed to be regularly high.Sealed caps ensure that none of the "fizz" is lost. The bottlesare light, with flexible packaging, so they wont crack or leak,and are not too heavy to casually walk around with. The cansare also light and safe.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, 25
  26. 26. • Fanta brand soft drinks,• Sprite,• diet Sprite• Sprite Remix 26
  27. 27. Product Lifecycle of Coke:Product life cycle has four phases1. Introduction2. Growth3. Maturity4. Decline.The markets where Coke is a dominant player are United States ofAmerica, Europe and Asia, Africa. There is a vast difference in termsof above given phases for example, in U.S.A & Europe it has reachedmaturity stage where it can’t expand its market more but if weconsider Asia, it is still in the growth phase.Coca-Cola is currently going through the maturity stage in Westerncountires. This maturity stage lasts longer than all other stages. 27
  28. 28. Management has to pay special attention to products during thisstage of the product life-cycle. During the maturity stage, productsusually go through a slowdown in sales growth. According to Coca-Colas 2001 annual report, sales have increased by 1.02% comparedto last year. This percentage has no comparison to the high level ofgrowth Coca-Cola enjoyed during its growth stage. To add a littlevariation Coca-Cola took the Coca-Cola Classic and added variationsto it, including Cherry Coke, Vanilla Coke and Diet Coke. Also Coca-Cola went from 6-oz. glass bottles to 8-oz. cans to plastic literbottles, all helping increase consumption. COCA-COLA 2. Price: 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 Cos CEO "The more successful they are, the sharper we have to be. If the Coca-Cola 28
  29. 29. Company didnt exist, wed pray for someone to invent them."states it simply. The relationship between Coca-Cola & Pepsi isa healthy one that each corporation has learned to appreciate.Throughout the years Coca-Cola has made many pricingdecisions but one might say that their ultimate goal has alwaysbeen to maximize shareholder value. As cola consumption hasdecreased in the US colas have come to realize the untappedinternational market. In 2003 both Coke and Pepsi had a solidpresence in India and had each introduced a 300mL bottle. Inorder to grab market share Pepsi began to drop prices (evenwith summer approaching, which was contrary to policy inAmerica). Shortly thereafter, Coca-Cola decided to drop theirprices slightly, but focused on the reduced price point of their200mL container. Coca- Cola planned to use the lower pricepoint to penetrate new cities that were especially pricesensitive. The carbonated soft drink market in India is nearly37% of the total beverage market there.This low price strategy was not unfamiliar to Coca-Cola. BothCoke & Pepsi utilized a low price strategy in the early 1990s.After annihilating the low price store brands, Coke chose toreposition itself as a "Premium" brand and then raise prices.Coca-Cola products would appear, on the shelf, to have themost expensive range of soft drinks common to supermarkets,at almost double the cost of no name brands. This can be forseveral reasons apart from just to cover the extra costs ofpromotions, for which no name brands do without. It createsconsumer perceptions and values. When people buy Coca-Colathey are not just buying the beverage but also the image thatgoes with it, therefore to have the price higher reiterates thefact that the product is of a better quality than the rest andthat the consumer is not cheap. This is known as value-basedpricing and is used by many other industries in attractingconsumers.In India, the average income of a rural worker is Rs.500 amonth. Coca Cola launched a 200 ml bottle for just Rs.5, anaffordable amount on the pockets of the rural audience. 29
  30. 30. 3. Place: 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. 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 30
  31. 31. • Fast Food • Petroleum Retailers • Chain Drug Stores • Hotels/Motels/Resorts • Mass Merchandisers • U.S. DOD Military Resale retail commands: AAFES, NAVRESSO and DECA • VendingIn 2006, the Company began changing its delivery method forits route delivery system. Historically, the Company loaded itstrucks at a warehouse with products the route deliveryemployee would deliver. The delivery employee wasresponsible for pulling the required products off a side loadtruck at each customer location to fill the customers order.Coke began using a new CooLift® delivery system in 2006 in aportion of the Companys territory which involves pre-buildingorders in the warehouse on a small pallet the deliveryemployee can roll off a truck directly into the customerslocation. The CooLift® delivery system involves the use of arear loading truck rather than a conventional side loadingtruck. Coke will continue to rollout this program over the nextseveral years since they expect such significant savings andmore 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 whichproduces the secret formula concentrate and ships to thedistributors and bottlers for final processing and packagingprior to shipment to the stores.Coca-Cola floods all possible retailing stores in satisfying thethird part, place. In supermarkets and convenient stores, Coca-Cola products are always easy to identify, and usually make upthe greater proportion of options to buy. This increases theirmarket exposure through effective use of the retailers. For aFMCG it is important that they can be found and purchased 31
  32. 32. easily. With many automatic Can machines located in manysports stadiums and shopping malls, you dont even need to goto a store to buy a drink. This greatly enhances the speed ofpurchase.The company produces concentrate, which is then sold tovarious licensed Coca-Cola bottlers throughout the world. Thebottlers, who hold territorially exclusive contracts with thecompany, produce finished product in cans and bottles fromthe concentrate in combination with filtered water andsweeteners. The bottlers then sell, distribute and merchandiseCoca-Cola in cans and bottles to retail stores and vendingmachines. Such bottlers include Coca-Cola Enterprises, which isthe largest single Coca-Cola bottler in North America andWestern Europe and food service distributors.The Coca-Cola Company only produces a syrup concentrate,which it sells to various bottlers throughout the world who holdCoca-Cola franchises for one or more geographical areas. Thebottlers produce the final drink by mixing the syrup withfiltered water and sugar (or artificial sweeteners) and thencarbonate it before filling it into cans and bottles, which thebottlers then sell and distribute to retail stores, vendingmachines, restaurants and food service distributors.The Coca-Cola Company owns minority shares in some of itslargest franchises, like Coca-Cola Enterprises, Coca-Cola 32
  33. 33. 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.STRATEGIC PLANNINGIn the year 2002, the company had a great success, as the strategyworked which resulted in making Coca Cola Company the world’sleading company. In 2001, company accomplished the crust of it’sstrategy as • Worldwide volume increased by 4 percent with strong international growth of 5 percent and clear signs that our North American business is growing solidly and predictable. • Earnings per share grew by 82 percent, as we delivered on our commitment to create volume growth while aggressively • Return on common equity grew from 23 percent in 2000 to 38 percent this year. • Return on capital increased from 16 percent in 2000 to 27 percent in 2001. • The company has generated free cash flow of $3.1 billion, up from $2.8 billion in 2000, a clear indication of its underlying financial strength.The strategy for the future of the company is very straightforward.The marketing strategy for the year 2002 is as follows, • Accelerate carbonated soft-drink growth, led by Coca-Cola. 33
  34. 34. • Selectively broaden the family of beverage brands to drive profitable growth. • Grow system profitability and capability together with our bottling partners. • Serve customers with creativity and consistency to generate growth across all channels. • Direct investments to highest potential areas across markets. • Drive efficiency and cost-effectiveness everywhere.MAJOR COMPETITORPEPSI INTERNATIONALHISTORYPepsiCo is a world leader in convenient foods and beverages, withrevenues of about $27 billion and over 143,000 employees. Thecompany consists of the snack businesses of Frito-Lay NorthAmerica and Frito-Lay International; the beverage businesses ofPepsi-Cola North America, Gatorade/Tropicana North America and 34
  35. 35. PepsiCo Beverages International; and Quaker Foods North America,manufacturer and marketer of ready-to-eat cereals and other foodproducts. PepsiCo brands are available in nearly 200 countries andterritories.Many of PepsiCos brand names are over 100-years-old, but thecorporation is relatively young. PepsiCo was founded in 1965through the merger of Pepsi-Cola and Frito-Lay. Tropicana wasacquired in 1998 and PepsiCo merged with The Quaker OatsCompany, including Gatorade, in 2001.would entertain the listenerwith the latest musical selections rendered by violin or piano orboth. The new name, “Pepsi Cola”, is derived from the two of theprinciple ingredients, Pepsin and Kola Nuts. It was first used on theAugust 28. At that time, Bradham’s advertising praises his drink as“Exhilarating, invigorating, aids digestion”.1990-2002The advertisement of the Pepsi changes to, “You got the right onebaby, Uh-Huh!”.With the extensive usage of the stars in the adds,the popularity of Pepsi increase. In 1992 Pepsi-Cola formed apartnership with Thomas J. Lipton Co. Today Lipton is the biggestselling ready-to-drink tea brand in the United States. Outside theUnited States, Pepsi-Cola Companys soft drink operations includethe business of Seven-Up International. Pepsi-Cola beverages areavailable in more than 190 countries and territories.In Asia, they selected Lahore to make their regional office. This wasdone in 1970. This regional office is monitoring all the operationscarried out in South West Asia. As in Pakistan, they only enteredbeverage industry. They have eleven bottlers covering wholePakistan. The plant operating here is Riaz Bottlers (Pvt) LTD. Thisplant was established at Lahore in 1974. The total capacity of theplant is 30,000 cases per day. They have four filling lines in the plantoperating on the three shift bases. Each shift is of eight hours. Theyhave permanent work force of 750 people and them employeeapproximately 1000 people more on temporary basis duringsummer season.Pepsi’s Products 35
  36. 36. • Pepsi • Teem • Mirinda • Pepsi Max • Pepsi Lemon • Pepsi Blue • Mountain Dew • 7upCOCA COLA PAKISTANThe Coca-Cola Company began operating in Pakistan in 1953. Coca-Cola, Fanta and Sprite are the brands in Pakistan. The Coca-ColaSystem in Pakistan operates through eight bottlers, four of which aremajority-owned by Coca-Cola Beverages Pakistan Limited (CCBPL).The CCBPL plants are in Karachi, Hyderabad, Sialkot, Gujranwala,Faisalabad, Rahimyar Khan, Multan and Lahore. The remaining twoplants, independently owned, are in Rawalpindi and Peshawar. TheCoca-Cola System in Pakistan serves 70,000 customers/retailoutlets. The Coca-Cola System in Pakistan employs 1,800 people.During the last two years, The Coca-Cola System in Pakistan hasinvested over $130 million (U.S.) 36
  37. 37. PROMISE OF COKEThe basic proposition of our business is simple, solid and timeless.When we bring refreshment, value, joy and fun to our stakeholders,then we successfully nurture and protect our brands, particularlyCoca-Cola. That is the key to fulfilling our ultimate obligation toprovide consistently attractive returns to the owners of our business.TARGET MARKETCoke’s commercials basically based on young generations, So, theyoung generation is the target market of Coke because they want torepresent Coke with the youth and energy but they also considerabout the old people they take then as a co-target market.MAJOR SEGMENTSMajor segments are basically those people who take this drink dailyand those areas where the demands is higher then the other areas.There are so many people who take this drink daily and thosepeople who take weekly and those who take less often are alwaysthere as well. So, their basic segments are those people who takethis drink regularly.FACTORS EFFECTING SALES 37
  38. 38. There are so many factors, which affects the sale of coke. Here weare discussing three major factors which effects coke.• Per capita income• Competitors• WeatherPer Capita IncomeFirst we will discuss about “ Per capita income”. This is major factorthat affects the sale of this soft drink. Because which every passingyear budgets are becoming very strict and tight in order to purchasethings. So the disposable incomes of the people are coming down.They spend heavily on rents, utilities, and education and basicnecessities and after that when they get extra money they thinkabout this soft drink .So the decreasing per capita income effectsbadly in selling and production of this soft drink.And to get through with this difficulty there is need to increase thelevel of per capita income of Pakistan because it is much lesser thanthe rest of the countries.CompetitorsCoke’s major competitor is “PEPSI” and there is no hesitation to saythis because everyone knows that and all the other cold drinks andwater, coffee, tea is the competitors.WeatherWeather is the third major factor in effecting the Coke’s selling. Thisis underdeveloped market so the coke’s consumption in summers is60% and in winters is 40%.MAJOR CUSTOMERS NEED 38
  39. 39. First of all the majority don’t care that what they are going to have.In other words, they don’t care before drinking that whether it is“Pepsi” or “coke”. They don’t actually differentiate between thesetwo brands in order to their tastes.Consumers basically drink what they get.They believe on “WHAT COLD THEY SOLD”Consumer’s availability in brands is basically works like:Push availabilityPull consumer’s demand.For this reason Coca-Cola have provided their coolers and freezers inthe market. They have maximum number of coolers and freezers inthe market. They provide this infrastructure free of cost just toprovide child coke to their customer, which they want to bepurchase.Their salesman and mechanics regularly visit all the shops wherecoke has its infrastructure to check that either it is in propercondition or not, if not then they immediately change or repair it.MAJOR COMPETITORSConsumers firstly decide that they are going to have a soft drink.Then they compete brands with each other. Like they compete Cokewith Pepsi and Sprite with 7up and team .So the major competitor ofCoke is Pepsi.When they motivate to any other brand or on Coke it’s in instinctbasically that based on messages derive certain feelings.But Coca Cola thinks in a different way, they believe that RC Cola,new coming AMRAT Cola, and all juices, even they take water andtea as their competitors.STRATEGIES OF QUALITYAfter Micro and macro analysis Brand “coke” is primarily role 1. Enhance competition moments 2. When people watch cricket 3. Through commercialization 4. Fun time 39
  40. 40. Though these strategies there could be better understanding andbetter connection with the public. These are the “key consumption”.THREATS FROM COMPETITORSThreats are well planned. Price is the major threat. When price goescertain beyond the exact price whether come down or go higher itseffects the consumption of soft drink.Because when the price goes higher people go for the substitute of“coke” i.e. Pepsi.And when price goes down they think that there is must besomething wrong in it.In short it all depends on customer’s perception.TARGETS THAT WOULD LIKE TO ATTAINEvery organization runs on the bases of profit maximization so Cokeis also looking for a high profit margin.There are three major ways of making money • Overnight profit • Windfall profit • Ethical and un-ethical waysOver Night ProfitsThey could be over night profit that is for the number 1 brand for theyear. This could be got my increasing sales volumeWindfall ProfitCan be windfall profit. They are the extras profit. When theconsumption the consumption is on boom. So, there is different kindof profits.Ethical And Unethical Ways 40
  41. 41. Profit can also get through ethical and unethical ways. They believe on this quote“Everything is fare in love and war”.Some profits stays for some time like “over night profits” and somejust come and go like “wind fall profits”. And they can also get profitthrough different approaches.EXPANDING TARGET MARKETIn last 2 years Coke has come back in aggressive manner. • Consumer has choice • Attractive brand name • Brand differentiatingConsumer Has Got ChoiceNow the consumer has got choice. Because now they know thename of another big brand, though coke is the 2nd best name but itcan get a better position after some timeAttractive Brand NameNow the consumers know the Name of Coke, because Coke is thename, which is the most popular after the word “ok”. So people canbetter differentiate brands with each other.Brand DifferentiationNow different companies have got different brand names. So, peoplecan distinguish between brands. Two major brands “coke” and“Pepsi” also have brand names.Coca Cola’s BrandCoca cola is “US” brand. Because they believe in the togetherness,being people together and friends are being together. Coca Colastrongly believes that Pakistani temperament is “US” not “ME” 41
  42. 42. Pepsi’s BrandPepsi’s brand is basically is basically “ME” branded. They use thetemperament of “ME”. In contrast to Coke they believe on individualstruggle. THREATS AND OPPORTUNITIES FOR PRICEOpportunitiesIf Coke is considered a luxury product. Then there is the tax ratesystem15% - sales tax20% - excise duty27% - goes to government03% - In making BudgetAfter paying all these taxes coke has to pay electricity charges. Wehave to spend on distributions. After paying all these expensesCoke’s margin squeezed and consumers have to pay for increasingtariffs.These are the opportunities through which we can increase the priceand can get profits.ThreatsThere are much more threats in increasing prices. Because sameproblem of substitute. If Coke increases the price let’s say 1 rupee.Then people definitely won’t go for coke. They have the bestsubstitute of Coke that is Pepsi. So these are the threats inincreasing prices. Coke will lose the margin of its profit and can faceloss.STRATEGIES OF GETTING GOALS I.E. “HIGH PROFITS”To increase the price is the least thing, which Coke can adopt. Thereare so many ways through which Coke can increase the profits.Some major ways are as follows. • Volume can be increased 42
  43. 43. • Interest level of consumers • To take part in energetic festivalsHow to increase the volume of consumers?Coke can increase the volume by expanding the industry of coke.Through advertisements, offering different interesting things toattract people towards this product.How to increase the interest level of consumers?Coke is increasing the interest level of consumers by offeringdifferent flavors.For example Coke is increasing the number of flavors in “Fanta”, thisis one of the product of coke. Through offering different flavors Cokecan increase the Level of consumers and through this profits can begained.How to take part in energetic festivals?Coke is already taking part in the festival like “Basant” since last 3years. Coke offers different attractive things in their festival andthrough this Coke gained high profit and consumption of cokeincreased on these occasions.And this year in this year 2002 people were anxiously waiting thatwhat interesting thing coke is going to offer.MARKETING STRATEGYOur local marketing strategy enables Coke to listen to all the voicesaround the world asking for beverages that span the entirespectrum of tastes and occasions. What people want in a beverageis a reflection of which they are, where they live, how they work andplay, and how they relax and recharge. Whether youre a student inthe United States enjoying a refreshing Coca-Cola, a woman in Italytaking a tea break, a child in Peru asking for a juice drink, or acouple in Korea buying bottled water after a run together, werethere for you. We are determined not only to make great drinks, but 43
  44. 44. also to contribute to communities around the world through ourcommitments to education, health, wellness, and diversity. Cokestrives to be a good neighbor, consistently shaping our businessdecisions to improve the quality of life in the communities in whichwe do business. Its a special thing to have billions of friends aroundthe world, and we never forget it. MARKET POSITIONINGProduct RangeThe total range of Coca Cola Company in Pakistan includes: • Coke. • Sprite. • Fanta. • Diet Coke.And company offers their products in different bottle sizes theseincludes: • SSRB (standers size returnable bottle) • LRB (litter returnable bottle) • NRB (no return bottle) or disposable bottle • PET 1.5 (1.5 liter plastic bottle) • CANS (tin pack 330 ml)PackingCoca cola products are available in different packing 44
  45. 45. • 24 regular bottle shell • 6 bottle pack for 1.5 pets • 12 bottles in a pack for disposable bottlePRICE STRATEGYTrade PromotionCoca Cola Company gives incentives to middle men or retailers inway a that they offer them free samples and free empty bottles, bythis these retailers and middle man push their product in themarket. And that’s why coca cola seen more in the market. And theyhave a good sale in the market because according to the expertwhich product seen more in the market that sells more.“Seen as sold”They do agreements with a shop keepers and stores to exclusivesale in those stores. These stores are called as KEY accounts in theirlocal language.And coke also invest heavy budget on these stores and offers themfree samples and free bottles and some time cash incentives.Different Price in Different SeasonsSometimes Coca Cola Company changes their product pricesaccording to the season. Summer is supposed to be a good seasonfor beverage industry in Pakistan.So in winter they reduce their prices to maintain their sales andprofit. But normally they reduce the prices of their pet bottles or 1litter glass bottle.PROMOTION STRATEGIESGetting shelvesThey gets or purchase shelves in big departmental stores anddisplay their products in that shelves in that style which show theirproduct more clear and more attractive for the consumers.Eye Catching Position 45
  46. 46. Salesman of the coca cola company positions their freezers andtheir products in eye-catching positions. Normally they keep theirfreezers near the entrance of the stores.Sale PromotionCompany also do sponsorships with different college and school’scafes and sponsors their sports events and other extra curriculumactivities for getting market share.UTC SchemeUTC mean under the crown scheme, coca cola often do this type ofscheme and they offer very handy prizes in it. Like once they offerbicycles, caps, tv sets, cash prizes etc. This scheme is very muchpopular among children.DISTRIBUTION CHANNELSCoca Cola Company makes two types of sellingDirect sellingIndirect sellingDirect SellingIn direct selling they supply their products in shops by using theirown transports. They have almost 450 vehicles to supply theirbottles. In this type of selling company have more profit margin.Indirect SellingThey have their whole sellers and agencies to cover all area.Because it is very difficult for them to cover all area of Pakistan bytheir own so they have so many whole sellers and agencies toassure their customers for availability of coca cola products.FACILITATING THE PRODUCT BY INFRASTRUCTURE 46
  47. 47. For providing their product in good manner company has providedinfrastructure these includes: • Vizi cooler • Freezers • Display racks • Free empty bottles and shells for bottlesADVERTISEMENTCoca Cola Company use different mediums • Print media • Pos material • Tv commercial • Billboards and holdingsPrint MediaThey often use print media for advertisement. They have a separatedepartment for print media.POS MaterialPos material mean point of sale material this includes: posters andstickers display in the stores and in different areas.TV CommercialsAs everybody know that TV is a most common entertaining mediumso TV commercials is one of the most attractive way of doingadvertisement. So Coca Cola Company does regular TV commercialson different channels.Billboards and Holdings 47
  48. 48. Coca cola is very much conscious about their billboards andholdings. They have so many sites in different locations for theirbillboards.EXPECTATIONS FOR THE COMING YEAR Everything starts from the attitude of consumer’s behavior. And thebasic key to attract the consumers is to throw the “money away”.And positive feeling felling with the brand, which they used to haveCoke wants to advertise their products heavily in the coming year.And it will take the 10% of their profits. And when we take it as aglobal level it is $ I billion.Coming year is the challenging year for the industry of Coke. Theyhave to take lots of decisions that how to increase the productionand where they have to spend money.For gaining success in coming year they have to have someimportant things like: 1. Loyal consumers are important for company’s success. 2. Workers should be the brand centric not the promotion centric. 3. They should know how much to for the brand activities. 4. They should also know that how much to do with the promotion activities for brand.HOW COKE DETERMINE THE YEARLY BUDGETCoke determines its yearly budget by the • Sales volume • Profitability • Target volumeSales Volume 48
  49. 49. Coke determines its yearly budget through the sales volume. Theyfirst concentrate on the thing is “what is the condition of theirsales?” if the condition is good of their sales then they definitelyincrease their production and sales volume. Otherwise theyconcentrate on their old strategies.Profitability:The second thing through which they determines budget is the“profit” .if they r getting profits with the high margin, then theydefinitely want to increase their profits in the next coming year.Every organization runs on the basis of getting high profits. Noorganization wants to face Loss in their business. To get profit is thefirst priority of the Coke.Target Volume:To run the business every industry has some targets, which theywant to achieve in a specific time period. If industry achieves thosegoals in that period then for the coming year it increases the volumeof the target.So Coke Follow the same thing it has also some goals and targets toachieve in the given time period. When they succeed to achieve thattarget then they increase their target volume in the next year.SALES PROMOTION ACTIVITIESCoca-Cola CricketCricket the most sought after; watched & played game in Pakistan.the game of cricket has been owned by various brands in theindustry for the promotion of their products over a period of time. Ithas ranged from tobacco to lubricants to communication companiesto banks to airlines & lately to the beverage industry. Thecompetition has become tougher & tougher as the time hasprogressed.Coca-Cola signed a sponsorship agreement with eight of Pakistan’s 49
  50. 50. National cricket players. Coca-Cola realizing the fact that cricket is avery strong element by which it can reach it consumers & massesinvested in the opportunity and launched a massive campaign onmass media showing all these cricket stars endorsing &complimenting Coca-Cola brand. The Coca-Cola Company developedthree TV commercials & four testimonial ads with the player & ranthem on the national net work during various cricket matches. Thesebold steps taken by the Coca-Cola marketing unit acclaimed themmany acknowledgements across the board. This campaign helpedCoca-Cola to establish its association with the game & the player.Coca-Cola ConcertsAbrar-ul-haq’s distinct style, lyrics & songs have made him aninstant hit among the masses in Pakistan. His enormous popularityin the country & abroad is supported by Coca-Cola’s commitmenttowards providing healthy & fun-filled entertainment for the youth ofPakistan. Coca-Cola brought Abrar to his fans through holdingconcerts & featuring Abrar in a much-appreciated TVC & MMTfeatured throughout the country.The TVC campaign focused on the hectic lifestyle of a pop star whofound respite & relief through Coca-Cola in short moments that hehad to himself during a concert. Coca-Cola’s brand positioning ofproviding deep down refreshment for the body, soul & mind werecaptured accurately in the TVC & depicted aptly how the drinkcompletes the moment for Abrar.Coca-Cola Food MelaWith a splash of food, fun & prizes to be won, the Coca-Cola foodmela treated the people of Karachi, to a festive food festivalcomprising of 50 restaurants, spread out all over the bustling city’smap. The promotion saw the avid families & friends enjoying thedelicacies at the restaurants; all resiliently upholding the Coca-Colaidentity.Coca-Cola Basant FestivalIn February the month of basant the parks & horticulture authority inLahore nominated Coca-Cola the official sponsor of the basant 50
  51. 51. festival .Coca-Cola added to the carnival atmosphere by making thefestival free to enter & decorating all main roads in Lahore withilluminated kites. Coca-Cola also hosted a concert of pop idol Abrar-ul-haq, had children’s parade & held the Coca-Cola kite flyingchampionship during the basant festival. Now “where there isbasant there is Coca-Cola”, it has been impossible to envisagebasant without Coca-Cola. Coca-Cola give the more refreshing flavorto the colors of basant by adding more life to the festival, giving theconsumer a unique experience which they had never tasted before.Coca-Cola GO-REDQuenching the thirst of motorist, pedestrians & passerby’s duringLahore’s hottest summer season, Coca-Cola’s “GO-RED” teams wentout into the cities main quadrants to “serve & refresh” on the spotwith ice-cold Coca-Colas at discounted prices backed by a heavy FMannouncement campaign the “GO-RED” stall, served well topromote the Coca-Cola industry.Coca-Cola Party in a ParkIn June 2000, Coca-Cola created an experiential musical evening inLahore, where Junoon performed. This program was recorded andone-hour program shown in the national TV for free.10 millionhouseholds saw Coca-Cola ‘Party in a Park’ while 10 thousandpeople attended the event.Coca-Cola Shopping FestivalCoca-Cola hosted “The Coca-Cola Shopping Festival” Lahore’s firstshopping festival, a resounding success with tempting discounts,live music, great prizes & fire works. Liberty marketing Gulberg wasa hive of activity during the weeklong shopping extravaganza. Thein augural event proved so popular that it is now set to become anannual fixture.Coca-Cola Pet PromotionIn 1996, Coca-Cola launched 1.5 liter Pet contour bottle for the firsttime in Pakistan. Targeting house wives & family home, Coca-Cola’s1.5 liter Pet bottle, took the limelight & gained momentum with a 51
  52. 52. campaign promoting the unique packaging and its numerousconsumer benefits .A treat for the family, Coca-Cola’s PET wasoffered through a “price-off” promotion that said……….Go out &get someCoca-Cola Ramzan CampaignA very special occasion for the people of Pakistan Ramzan sawanother very special Coca-Cola’s promotion, marketing the popular1.5 liter PET bottle & the 1 liter bottle with a super price-offpromotion. The emphasis on enjoying Coca-Cola at “Iftar” withfriends & family.Coca-Cola Wonder of the World PromotionIn July 2000, Coca-Cola set the stage of the grand UTC promotion.Coca-Cola went ahead with the idea of giving consumer chances towin fabulous, magical “dream vacation” to numerous “wonderdestination” throughout the world on every purchase of a 250 mlRGB bottle of Coca-Cola, Sprite, & Fanta.The promotion gaveconsumers a chance to win free drink, a trip to PARIS, HOLLYWOOD,NEWYORK, SINGAPORE & CAIRO along with airfare & four nights freestay in these dream lands. The promotion saw avid consumercollecting Coca-Cola ‘Crown caps’ & sparked a keen response fromthe public , rendering an outstanding testimonial campaign in thesecond phase, highlighting the winners over whelmed in the magicaldelight of their favorite beverage Coca-Cola.Coca-Cola & NokiaIn August 2001, the new under-the-crown promotion “NiklaKiya?”(What have u won) was launched in collaboration withChimera Nokia.The promotion gave consumer a chance to winthousand’s of Coca-Cola branded Nokia 3310 cellular phones onevery purchase of 750ml RGB bottle of Coca-Cola ,Sprite, &Fanta.The other highlight of promotion was the “Caught RedHanded” campaign. Branded Coca-Cola with ‘caught red handed’team in them went to Lahore & Karachi for three days, with targetthat anyone being caught drinking Coca-Cola will be awarded anokia 3310 mobile phone & if someone is caught talking on a nokiamobile will win free supply of Coca-Cola. Caught red handed become 52
  53. 53. a huge success among the masses as it was one to one interactionbetween the Coca-Cola brand & the consumers. This activity helpedbilled confidence and brand loyalty among core consumers.Coca Cola TV MazzaThe coca cola new campaign is coca cola tv mazza, it is a utcscheme in which people are getting television sets of different sizes.These days this scheme is very popular among the people.Coca-Cola & Mc Donald’sCoca-Cola & key account of MC Donald’s launched the “we gotogether” joint promotion to reinstate amongst consumers a realsense of the affinity that, both shares globally. The promotion kickedoff with pos material (Danglers, Bunting etc) displayed at all MCDonald’s restaurants along with a special offer for coke & fries.Fanta & Sprite LaunchedIn November 2000moving on to the Sprite & Fanta brands, theconsumers in Pakistan witnessed a soft launch in essence. The Coca-Cola Company declared the new “Non-Returnable” bottles of Sprite& Fanta as the “New, On the Go Packs” flaunting the innovativepackaging convenience. Fanta & Sprite are sure to enjoyconsiderable success in Pakistan.Diet CokeAfter the acquisition of the individual local franchise bottlingfacilities in 1996, the company has successfully launched its firstnew product, diet coke, for the first time in almost 3 years. The waslinked with three fashion shows as Diet Coke is related to fashion &fitness, but the major hit was thematic fashion shows in restaurants,which are the key accounts of the company as this has been neverdone before in Pakistan. SWOT ANALYSISStrengths: 53
  54. 54. Coca-Cola has been a complex part of American culture forover a century. The products image is loaded with over-romanticizing, and this is an image many people have takendeeply to heart. The Coca-Cola image is displayed on T-shirts,hats, and collectible memorabilia. This extremely recognizablebranding is one of Coca-Colas greatest strengths.Additionally, Coca-Colas bottling system is one of theirgreatest strengths. It allows them to conduct business on aglobal scale while at the same time maintain a local approach.The bottling companies are locally owned and operated byindependent business people who are authorized to sellproducts of the Coca-Cola Company. Because Coke does nothave outright ownership of its bottling network, its main sourceof revenue is the sale of concentrate to its bottlers.A company like Coca-Cola has much internal and externalstrength, but when launching a product of this sort, they beginto run into many internal and external weaknesses as well. Asfar as internal strengths go, Coca-Cola itself is a strongcompany to say the least. Not only are they a $23 billioncompany, but in 200 nations, Coke sells about 400 drinkbrands, including four of the top five sellers right now. Theyown 36% of the largest Coke bottler in the world, Coca-ColaEnterprises, which staffs facilities all over the world.Although Coke has never produced an organic product, they doown Odwalla, which is a natural juice company. This productwould not be marketed as an Odwalla brand, but Odwallasknowledge of natural juice making will be a great strength forCoca-Cola.Organic products are on the rise, with 70% of Americans havingpurchased something organic at least once. While organics arebecoming more and more popular, there still are not manywell-known organic companies; therefore, Coca-Cola will nothave much competition.Perhaps one of their biggest strengths is the brand loyalty theircustomers have. When this product is launched, avid Cokedrinkers will choose this organic fruit juice or soda over any 54
  55. 55. other competitor simply because its a Coca-Cola product and they trust it.Weaknesses: Although domestic businesses as well as many international markets are thriving, Coca-Cola has recently reported some "declines in unit case volumes in Indonesia and Thailand due to reduced consumer purchasing power." According to an article in Fortune magazine, "In Japan, unit case sales fell 3% in the second quarter because while Japan generates around 5% of worldwide volume, it contributes three times as much to profits. Latin America, Southeast Asia, and Japan account for about 35% of Cokes volume and none of these markets are performing to expectation. Coca-Cola on the other side has effects on the teeths which is an issue for health care. It also has got sugar by which continuous drinking of Coca-Cola may cause health problems. Being addicted to Coca-Cola also is a health problem, because drinking of Coca-Cola daily has an effect on your body after few years.Opportunities: Brand recognition is the significant factor affecting Cokes competitive position. Coca-Colas brand name is known well throughout 94% of the world today. Packaging changes have also affected sales and industry positioning, but in general, the public has tended not to be affected by new products. Coca- Colas bottling system also allows the company to take advantage of infinite growth opportunities around the world. This strategy gives Coke the opportunity to service a large geographic, diverse, area.Threats: Currently, the threat of new viable competitors in the carbonated soft drink industry is not very substantial. The 55
  56. 56. threat of substitutes, however, is a very real threat. The soft drink industry is very strong, but consumers are not necessarily married to it. Possible substitutes that continuously put pressure on both Pepsi and Coke include tea, coffee, juices, milk, and hot chocolate. Even though Coca-Cola and Pepsi control nearly 40% of the entire beverage market, the changing health-consciousness of the market could have a serious affect. Of course, both Coke and Pepsi have already diversified into these markets, allowing them to have further significant market shares and offset any losses incurred due to fluctuations in the market.Consumer buying power also represents a key threat in the industry.The rivalry between Pepsi and Coke has produced a very slowmoving industry in which management must continuously respondto the changing attitudes and demands of their consumers or facelosing market share to the competition. Furthermore, consumers caneasily switch to other beverages with little cost or consequenceCONCLUSIONAfter thorough research, we come to the conclusion that themarketing strategy of Coca Cola is working for them and the productis gaining popularity among youth day by day. 56
  57. 57. RECOMMENDATIONSAfter completing our project we have concluded somerecommendation for the coca cola company, which are following. • Coca Cola Company should try to emphasis more on providing their infrastructure in the market to facilitate their customers. • According to the survey, conducted by the international firm Pakistani people like little bit sweeter cola drink. So for this coca cola company should produce their product according to the local demand. • Marketing team should try to increase the availability of Coke in rural areas. • They should also focus the old people. • Now young generation has a trend to drink a coke 2 regular bottles at same time, so providing more satisfaction to them company should introduce ½ liter disposable bottle. PEST ANALYSIS OF COCA-COLAThere are four variables, which we will discuss in our report, theyare: POLITICAL VARIABLES 57
  58. 58. Political Strong Some No Some Strongly variables ly what Effe what Effected Effect Effected ct Effected −− ed + + − − ++ Effects of NE government regulations & deregulations Effect of YES environmental protection laws if any Import and NE export regulations Effect of political NE conditions in certain countries of Coke Any effect of YES election, military take over, Revolution at CokeConclusion Of Political Analysis:As far as the above table is concerned it could be seen that thereare very little chances of “political variables” to effect the coke’sproduction and selling behavior.In the “political variables” most of the things are related toGovernmental activities. So, they don’t leave any good or badimpact in the Industry of coke.And there are some exceptional things like: “environmentalprotection laws” they some what effect the industry of Coke. Fromlast two years Government is going to be really very much consciousabout the environment. But after making the adjustments in plantsand applying the proper way of wastage the chances of being 58
  59. 59. affected by the “protection laws” are going to be diminished. So itimpact good for the Coke’s reputation. And the second thing inpolitical variables which effects Coke is “elections & military takeover” Because in the days of elections and marshal law’s conditionthe countries production in any field is declined. So it affects slightlythe revolution of Coke.So “political conditions” are over all leave neutral effects oncoke’s industry. ECONOMICAL VARIABLES Economical Strong Some No Some Strongl Variables ly what Effec what y Effect Effecte t Effected Effecte ed d + − − d ++ + −− Do soaring YES interest rates make business task any harder Any effect due to YES inflation Anything done to YES reduce unemployment Any effect of 11th NE September 2001,incident at Coke in PakistanConclusion Of Economical AnalysisIt could be seen that “economical variables” highly affects theCoke’s resolution. Economic factors are those actors who effect theproduction of any industry. So, Coke is not the out of question. If theeconomic conditions of the country is not that strong and Cokeincreases its Price in this situation. Then it would impact highlynegative. And inflation is also not a good position for any country’s 59
  60. 60. production point of view. It also impacts highly negative in theCoke’s production.And as a country concerned like “Pakistan” where theunemployment rate is very much high. The Coca-Cola system inPakistan employs 1,800 people. During the last 2 years, the Coca-Cola system in Pakistan has involved over $130 million (U.S).When we draw the conclusion of “economic variables”. Then wecome to know that if economic variables are in the favorableposition of country then they impact good other wise the impacthighly bad.SOCIAL VARIABLES Social variables Strong Some No Some Strong ly what Effec what ly Effect Effected t Effected Effect ed + + − − ed ++ −− Effects of YES advertisement of Coke on Public popularity How will do Coke’s YES contribution affect charity organizations of Pakistan Has rising YES consciousness ofnatural resources in people effected your “save environment activities. 60
  61. 61. CONCLUSION OF SOCIAL ANALYSISEDUCATIONThe Coca-Cola Company has always believed that education is apowerful force in improving the quality of life and creatingopportunity for people and their families around the world.The Coca-Cola Company is committed to helping people make theirdreams come true. All over the world, we are involved in innovativeprograms that give hard-working, Knowledge-hungry studentsbooks, supplies, places to study and scholarships. From youth inBrazil to first generation scholars, educational programs in localcommunities are our priority.ENVIRONMENTA large part or our relationship with the world around us is ourrelationship with the physical world. While we have always sought tobe sensitive to the environment, we must use our significantresources and capabilities to provide active leadership onenvironmental issues, particularly those relevant to our business.We want the world we share to be clean and beautiful. We arealways innovating to bring you different delicious beverages. Thissame spirit of innovation comes alive in our environment programs.We’re committed to preserving our environment, from use of morethan $ 2 billion (U.S) a year in recycling content and suppliers, andenvironmentManagement initiatives, down to very local neighborhood collectionand beautification efforts. Here’s a sample of what we’re doing indifferent communities around the world regarding the conservationof water and natural resources, climate changes, waste environmenteducation.The Coca-Cola system in Pakistan operates through eight bottlers.Four of which are majority-owned by Coca-Cola Beverages PakistanLimited (CCBPL).COMMUNITY INVOLVEMENT: 61
  62. 62. In 2000, when eastern Pakistan suffered its worst droughts, TheCoca-Cola system initiated a famine-relief program to help victimsand was the first private-sector company to assist. The Coca-Colasystem in Pakistan initiated a voluntary Hajj program that allows oneemployee from each plant, selected through a draw, to be sent onthe Holy Pilgrimage to Mecca at the Company’s expense. TECHNOLOGICAL VARIABLES Technological Strong Some No Some Strong variables ly what Effec what ly Effect Effected t Effected Effecte ed + + − − d ++ −− Have business YES innovations effectively promoted your business Has the YES government’s regulations ever hindered in importing technical equipment Does Coke help YES in promoting paperless environmentConclusion Of Technological AnalysisOf course business innovation leaves highly good impacts in thebusiness of Coke. As coke use more advance technology in itsproduction process. It will resulted in increment of their productionthrough out the country.As far as the “governmental hindrances” are concerned the impactshighly bad on coke’s production. Ever year when budget in 62
  63. 63. announced government taxes rates always shoot up. This approachof government decreases the profit margin of Coke.As the coke helping in promoting “paperless environment” .itimpacts good, because computers are the basic need of any personnow a days. And though it’s a big industry so it is promoting thetrend of paperless environment. And it is giving the way of otherindustries to come to new technologies and into a new world ofbusiness. Through computers coke can increase the efficiency of itsbusiness and can have up –to-date data about their productions.OVER ALL RESULTS OF PEST ANANYSISAfter our studies and analysis of CCBPL (Coca-Cola BeveragesPrivate Limited), we came up with the very interesting report offacts and figures. Coca-Cola is no doubt one of the most popularbeverage company and its product COKE is one of most consumedcola drink. They spend billion of dollars on their advertisement,promotions and recreational campaign.Coca-Cola is a close competitor of Pepsi and it certainly gives itsrival a tough time. Coca-Cola is a 27% shareholder in the Pakistanmarket and they don’t want to stop here!! Its target market is toachieve a much higher %age. Coca-Cola has about 2000 employeesat Pakistani plants. Lahore plant of Coca-Cola is one of the beautifulplant in Asia, Situated on Raiwand Road.Coca-Cola has always had a close consumer and supplierrelationship with its customers. Its entertaining and colorfuladvertisements have always and will always rock the media.Pakistani rock stars, sportmen and actors have played a very vitalrole in making Coca-Cola such a popular beverage.DATA ANALYSIS 1. Have you ever tried the product (Coca-Cola)? 63
  64. 64. 35 30 25 20 15 10 5 0 yes noOut of the 30 people we surveyed, all of them said they hadtried Coca-Cola atleast once. This explains the brandawareness of Coca-Cola.2. Gender 20 18 16 14 12 10 8 6 4 2 0 male femaleOut of the 30 respondents, there were 18 men & 12 women.3. Age groups 64
  65. 65. Age Groups 51 & above 36-50 yrs 20-35 yrs 10-19 yrs below 10 yrs 0 5 10 15 no. of peopleAs represented in the chart, majority of the respondents werein the age group of 20-35 years, the least of the lot being 2 kidswho were also asked to participate in the survey.4. Do you enjoy the product (Coca-Cola)? no 23% yes 77%From the analysis, it was found that majority of 77% (23people) respondents said they enjoyed drinking Coca-Cola asagainst 23% (7 people) who said they preferred other drinks. 65
  66. 66. 5. What brand would you say is more popular among thepublic?a) Coca-Colab) Pepsic) Other Others 7% Pepsi 37% Coca-Cola 56%As seen in the chart, out of 30 people, 17 respondents said, intheir opinion, Coca-Cola was more popular while 11respondents said they preferred Pepsi as a popular brand.6. Do you enjoy Coca-Cola’s advertisements on TV? I don’t like them not bad they are good but nothing special I really like them 0 2 4 6 8 10 12 14 66
  67. 67. The chart represents that a majority of people thought theAdvertisements were good enough & they like what they see.7. Do you think the price for a can of Coca Cola is cheapor expensive? expensive slightly overpriced cheap 0 5 10 15 20 25 As seen in the above figure, a majority of 23 people out of the 30 respondents thought that the Coca-Cola Cans are slightly overpriced with a few people also rating it as expensive.8. If you were to see the Coca-Cola logo somewherewould you recognize it? 67
  68. 68. no 0% yes 100% It is understood from the fact that the Logo of the Company still has its image in the minds of the people with all the respondents saying they would recognize the “Coca-Cola” Logo.9. How often do you buy the product? everyday few times in a week few times in a month once/few times in a year never 0 5 10 15As it can be seen in the figure, it was concluded that majorityof the respondents bought the product quite frequently. Thisshows the brand loyalty of the customers towards Coca-Cola. 68
  69. 69. 10. Where do you buy Coca-Cola products the most? Restaurants general stores super markets 0 5 10 15 20As seen in the above chart, customers usually preferred to buyCoca-cola in restaurants like KFC, Mc Donalds, Sub-Way etc.The second largest option was General stores stocking Coca-Cola. 69