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Coca-Cola Company

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Coca-Cola Company

  1. 1. MARKETING MANAGEMENT PRESENTATION PRESENTED BY- SK. ANWAR ULLAH SNEHANT BISWAS SHRADDHA KEDIA SHREYA MOHTA SHREYA SINHA AMRITA NAIK SHRI HARI AGRAWAL
  2. 2.  The size of soft-drinks industry in India has been estimated upwards of Rs 50 bn.  The MNCs like Coke and Pepsi, dominate the Indian market having a total combined share of 95%(approx.) and rest are acquainted by local players.  There are more than hundreds soft-drink producing industry, majority are Indian bottlers.
  3. 3.  The Industry employs nearly 125,000 people and contributes to govts. Kitty through exports.  Soft-drinks market comprises of two distinct segments: a. Cola drinks b. Non-Cola drinks  The per capita consumption of soft drinks in India remains low at around 5-6 bottles per year, that matched that of Nepals, far exceeded by; Pakistan’s figure of 17 bottles, Thailand’s 73, Srilanka’s 21, Philippine’s 173 and Mexico’s 605.
  4. 4.  The soft drinks industries also create opportunities for growth of related ancillary units: a. Glass bottling b. PET bottles c. Refrigeration d. Transportation e. Packing f. Sugar
  5. 5.  The industry has been protesting against the relatively high excise duty and taxes, imposed by the government.  The industry stated that a decrease in such tax would increase the size of the market substantially.  Cola-Cola and Pepsi were both affected when residues of pesticide were found in some of their product by CSE, that stated the presence of 5 different pesticides which were as much as 24 times higher than the norms of BIS.
  6. 6. 93 Million 100 Billion
  7. 7.  Coca-Cola, a multinational soft-drinks manufacturer originally began to retail in 1886.  Expanded through acquisitions of Gold spot, Limca, Thumps Up, etc during 1990s.  After re-entry in India, in 1993, the company made ‘significant investments’, including new production facilities, waste water treatment plants, distribution systems and marketing channels.
  8. 8.  The company had invested 1 bn USD in India in the first 10 years after 1993. The total investment is recently estimated to be 1.2 bn USD.  Coca-Cola today provides employment to nearly 6000 people and indirectly to a large number, estimated to as much as 125,000 through activities such as transportation, procurement, sales and distribution.
  9. 9.  Coca-Cola’s brands in the country include Coca-Cola, Thumps Up, Sprite, Fanta, Limca, Maaza, Minute Maid Pulpy Orange, Kinley, Georgia.
  10. 10. After operating for a few years in the country, the company realized that most of its products were sold mainly in the urban markets, with rural having extremely low penetration rates. However, the people in rural areas did have purchasing power, when taken in the aggregate. Although the rural market offered huge potential, it was not easy to penetrate. These were several issues:  Changes in distribution method. Poor rural roads resulted in significantly higher breakages of the glass bottles than in urban areas.
  11. 11.  In some areas, markets were simply inaccessible due to the absence of roads. Roads were simply washed away during the monsoon season or did not even exist in certain areas.  People preferred to consume soft drinks that were refrigerated. However, many rural shopkeepers did not have refrigerators. Long power cuts posed the challenge.  The market for soft drinks was seasonal.  The presence of alternatives such as sugarcane juice, butter milk and local drinks such as banta in rural areas meant that Coca-Cola had significant local competition. For example,
  12. 12. nimbu paani reportedly commands half of the total market share in the unpackaged juices segment.  Rural consumers were notoriously price and value conscious.  The usual marketing campaigns would have to be tweaked for rural consumers. While they did have some purchasing power, they were perhaps not suave enough to appreciate subtleties in advertisements. A rapport with customers needed to be established by portraying the image of a common man’s brand.
  13. 13.  Acording to MoFPI, the demand was 105 million cases in 1990-91. This increased to 125 million cases in 1992-93 and crossed the 150 million cases mark after another couple of years, 1994-95.  The demand went up to 180 million cases in 1996-97 and breached the 200 million cases mark for the first time in 1998-99.  By 2004-05, the milestone of the 300 million cases were marked; and it crossed 350 million cases marked in 2006-07.
  14. 14. OUR GLOBAL NETWORK
  15. 15.  Estimates for 2009-10 peg the demand at 400 million cases.  Western region of the country accounted for the largest share, around one-third of the total.  Northern and southern regions compete neck to neck and they account for approximately 25 percent each.  Eastern Region accounts below one-fifth of the total market.  In terms of the market split between rural and urban areas, the urban areas contribute around 70% of the total market share for aerated water. Whereas, rural market remains considerably under-penetrated.
  16. 16. Certain success factors were demonstrated:  Ensuring availability of the products- FMCG companies relied on ‘push sales’. The prerequisite was getting all the products into the retail market in sufficient volumes.  Affordability- Price point should be appropriate. Per capita rural incomes were low, and soft drinks were seen as an ‘optional extra’.  Awareness: Consumers need to be made aware of both the product and its benefits. Example, ask for a biscuit packet, and not specific brand.
  17. 17. a. Ensuring availability  CCI made massive efforts to strengthen its distribution network. It realized centralized distribution system used in urban areas may not be appropriate for the rural hinterland.  To reduce the transportation cost in rural areas, company adapted its distribution model into hub-and-spoke one.  CCI not only changed the distribution model but also changed the the type of vehicles used
  18. 18. for transportation. Now, large trucks are used to transport bottles from bottling plants to its hubs and smaller vehicles are used from hubs to spokes.  Company emphasised on the theme ‘going local’, in which smaller vehicles were purchased and used it to move the volumes in the area where larger-sized vehicles were inaccessible.  Hand carts, camels and mules were used for transportation.  PET bottles as added benefit.
  19. 19. b. Affordability  Getting the price right.  Presence of local brands made the competition stiff and healthy. They did not pay tax to the government, maintained pack size,
  20. 20. CCI conducted surveys, leading to some interesting conclusions:  Pack size (300ml bottles) was not appropriate.  Current pricing was too high.  Certain price points were perceived as more convenient and affordable ( Rs 1,2,3) Company decided to do two things:  Change the size of bottles from 300ml to 200ml.  Corresponding change in the price point. Pricing was done of 200ml bottle at the ‘magic prce point’ of Rs 5 ( Chota Coke)
  21. 21. INSERT FAMILY TREE
  22. 22. c. Spreading awareness  New distribution and pricing strategy was supported by a substantial marketing campaign. This comprised of indoor and outdoor campaigns, and company’s logo and colour was splashed all around the market.  Large hoardings in villages, logo was painted on many walls.  Local consumers were reached through mandis and haats, small kiosks.  Fairs or melas proved to be extremely important to all FMCG companies.
  23. 23. #SELFIE #ROYALBABY #MANDELA #TRANSFORMATIONTUESDAY
  24. 24. #AMERICAISBEAUTIFUL
  25. 25. Big Game to Sochi: 2014 Big Game - Hourly Sentiment and Benchmarks
  26. 26.  The company was MNC, and the mindset of Indian consumers and NGOs, many of whom protested against companies product, going to the extent of publicly pouring the ‘foreign colas’ down the drain in fornt of newsmen and cameras during a protest.
  27. 27.  The famous Bollywood actor Aamir Khan was roped in to advertise the company’s flagship product. The advertisement was executed by the agency McCann Erickson and TVC’s were directed by well known director, Asutosh Gowariker, of movie LAGAAN.  All the commercials were set in the rural setting and locations were complemented by the brilliantly insightful use of word ‘Thanda’ in the campaign and the tagline ‘Thanda Matlab Coca-Cola’.
  28. 28.  If you were to go to any restaurant or local dhaba, particularly in North India, the attendant would generally ask you, ’Do You Want Something Hot Or Cold?’. Thanda was therefore akin to an umbrella word, encompassing the alternatives such as lassi, nimbu pani, while hot meant tea or coffee.  The idea was thus to position Coca-Cola at the top of consumer’s mind. Hence, the tagline: ‘Thanda Matlab Coca-Cola’(Now means Coke).  In the commercials, Aamir Khan played different roles- a restaurant attendant, a Punjabi farmer and a Hyderabadi shopkeeper.
  29. 29.  For example, in the Punjabi farmer commercial, a group of young girls find themselves stranded in the middle of some farmlands and ask a farmer , played by Khan, for something thanda. The farmer somehow manages to retrieve a bottle for each of the girls from the bottom of a well in the fields. The commercial directly had an impact on the rural populance because it represented both their culture and an aspirational need.
  30. 30.  In another commercial, the Hyderabadi shopkeeper conveyed his irritation at one of his customers not knowing the words ‘thanda’ and Coke was inextricably linked.  Additionally, the price point of Rs 5 was also conveyed in a highly effective manner. To make it more appropriate, Aamir Khan did the role of a rustic, rural pan-chewing Bihari, which threw the audience into splits of laughter.
  31. 31.  All observers and market watchers were unanimous in their opinion. The TVCs had taken the country by storm and enjoyed tremendous brand recall across the country.  Prasoon Joshi of the agency McCann Erickson reportedly stated,’We are talking people, I understand our tradition and it pays to make use of regional dialects’.
  32. 32.  Shripad Nadkarni, Vice President of Marketing at CCI, said, ‘Prasoon has the ability to connect to the masses through his understanding of the Indian psyche- he thinks Indian’.  CCI’s sales from rural markets were also reported to have increased by 35% . Additionally, company decided to defer its diverfication plans into iced tea, juices, nimbu pani, etc.  The campaign won a number of awards for McCann. These were EFFIE, considered to be the Oscar of Indian Advertising.
  33. 33.  Other awards include, the Best TV Campaign ‘Thanda Matlab Coca-Cola’ at the ‘Indian Marketing Awards’; The Campaign Of The Year Awards presented by Advertising Agencies Association Of India (AAAI) and Advertising Club Mumbai (ABBY); the Golden Lion Award at Cannes Festival and the most prestigious marketing award of Coca-Cola Company, the ‘Don Keogh Marketing Mastery Award’.
  34. 34.  The global acquisition of Tropicana by Pepsi as well as the launch of Minute Maid by Coke are pointers to the changes scenario.  Both companies have even aimed at promoting the sale of bottled water through their brands Kinley (by Coca-Cola) and Aquafina (by Pepsi). Kinley has the estimated market share of 10% of the total packaged water.  In case of Coca-Cola, its lime drink has been branded ‘Nimbu Fresh’, and has been pushed in the market as ‘Ghar Jaisa’.
  35. 35.  Coca-Cola has also aimed to push ‘Maaza’, the mango flavoured drink it had acquired years ago from Parle. Additionally, iced tea and canned coffee, company was concerned about.  Meanwhile, companies are also forging new partnerships. For example, Pepsi India tied with HUL for adopting new technologies.  When Coca-Cola launched ‘Nimbu Fresh’, it tied with Big Bazaar across its 180 stores for pre-launch activity.  Coca-Cola is also planning for brand extensions like mixed-fruit version of Minute Maid, and in 2010, company launched an energy drink called ‘Burn’.
  36. 36. Listening at every level to inform our global voice Listen Identifying the right time to talk Analyze Moving beyond the ‘Like’ to the Love Engage
  37. 37.  Our Roadmap starts with our mission, which is enduring. It declares our purpose as a companyand serves as the standard against which we weigh our actions and decisions.  To refresh the world...  To inspire moments of optimism and happiness...  To create value and make a difference.
  38. 38.  Our vision serves as the framework for our Roadmap and guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable, quality growth.  People: Be a great place to work where people are inspired to be the best they can be.  Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy people's desires and needs.
  39. 39.  Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value.  Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities.  Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities.  Productivity: Be a highly effective, lean and fast-moving organization.
  40. 40.  Our values serve as a compass for our actions and describe how we behave in the world.  Leadership: The courage to shape a better future  Collaboration: Leverage collective genius  Integrity: Be real  Accountability: If it is to be, it's up to me  Passion: Committed in heart and mind  Diversity: As inclusive as our brands  Quality: What we do, we do well
  41. 41. We could have one thing in common, and it could be that we all like drinking Coke. - Sushmitha, #AmericaIsBeautiful Singer “
  42. 42. Thank You

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