2. FACTS ABOUT THE COMPANY
Company : Coca Cola
Sector : Consumer goods
Industry : Beverages
Country of origin : USA,1886
Founder : John Pemberton
Areas Served : More than 200 countries
Product Portfolio : Coca cola, Coca cola zero, Sprite, Minute maid,
Fanta, Coca cola light
Full time employees : 123,200
3. History of Coca Cola
• 1886 – Coca cola officially goes on sale : Cocaine was
an ingredient
• 1903 – Cocaine removed from coke
• 1916 – Iconic glass bottle design was introduced
• 1923 – Invents the six pack
• 1982 – Diet coke introduced
• 1985 – New coke was launched
• 1992 - Coke 2 was launched
• 2002 – Coke 2 was discontinued
• 2005 – Coke zero was introduced
• 2014 - Coke life introduced
5. Beverage Industry
• Includes companies that produces ready to drink
beverages
• Includes companies that market nonalcoholic and
alcoholic items
• To be competitive companies diversify product
offerings
• Companies has a steady performance throughout
the business cycle
• Largest players – Coca Cola, Pepsi, Sab Miller,
Nestle
6. PORTER’S 5 FORCE ANALYSIS
• Threat of New Entrants
• Threat of Substitutes
• Threat of Substitutes
• Bargaining Power of Suppliers
• Industry Rivalry
7. Threat of New Entrants
• Threat of new entrants is low in the beverage
industry.
• To get a good distribution channel very time-
consuming and expensive.
• The market is a mature one which diminishes
the scope of growth.
8. Bargaining power of buyers
• Bargaining power of buyers is high in the
beverage industry:
• The retail price of the bottlers has been
maintained for a long time.
• Very low switching cost.
9. Threat of Substitutes
• Threat of Substitutes is low in the beverage
industry
• The new bottlers cannot easily get good
distribution channels.
• Market share of the bottlers is quite high
10. Bargaining Power of Suppliers
• Bargaining power of suppliers is medium in
the beverage industry
• The relationship with the suppliers is good and
long-time.
• The producers have obtained small bottlers.
• The sales depend on the competitiveness of
the bottlers.
11. Industry Rivalry
• The rivalry among competitors is intense
• Cut-throat due to their almost similar pricing.
12. KEY SUCCESS FACTORS
• Constant product innovation
• Size of organization
• Established brand loyalty
• Price
• Taste
• Global Expansions
13. Attractiveness of the industry
• The Threat of new entrants is low as the market has
reached a mature stage but if the entrant has the
ability for high capital investments the threat can be
moderate in nature.
• Getting a good distribution channel is very time
consuming but it can cause a major impact in
increasing the reach of the organization.
• Bargaining power of the suppliers are high can cause a
major impact in this industry as the products can be
easily substituted by the other brands. To add up, many
healthier options are available now causing more
substitution of the products.
14. • The Internal competitive rivalry among the existing
firms along with the new firms create a very little
scope to enter in this industry.
• According to the EFE matrix, the average weighted
score of the industry 2.28 which indicates that the
industry has slightly less than average ability to
respond to external factors.
15. EFC MATRIX
EFC matrix Weight Rating Weighted Score
Opportunities:
Nutritional offerings to health
conscious people
0.07 2 0.14
Develop customer relation 0.03 1 0.03
Acquisitions of smaller players 0.05 2 0.1
Growth opportunities in un-
established markets
0.04 3 0.12
Growing demand 0.07 4 0.28
Brand diversification 0.06 3 0.18
Supply chain improvements 0.03 3 0.09
Contract with companies and firms
to install vending machines
0.04 2 0.08
Penetration marketing 0.06 2 0.12
Tie ups with restaurants , food
chains and organized retail stores
0.05 3 0.15
16. EFC matrix Weight Rating Weighted Score
Threats:
Increase in trend towards
healthy foods and drinks
0.07 3 0.21
Key competitors 0.06 4 0.24
Substitute products 0.05 3 0.15
Demand variability 0.06 3 0.18
Raw material sourcing – Lack
of water
0.07 2 0.14
Effect due to dollar price 0.05 2 0.1
Warning against coke
ingredients
0.04 1 0.04
Maturity of beverage industry 0.03 2 0.06
Image perception in different
parts of the world
0.04 2 0.08
Campaign against plastic
containers
0.03 1 0.03
Total : 1.00 2.34
17. RECOMMENDATIONS
• Make wise decisions about mergers and acquisitions
• Invest more on the un-established markets
• Install more vending machines
• Water replenishment should be done in the Coca-Cola
factories
• Diversify businesses to minimize market risk exposure
• Further penetrate developing markets to grow revenue –
concentrate more on organized retailers
• Improve product healthfulness to attract more consumers
• Increase production and distribution
• Enhance recycling efforts to address environmentalism
1.Product Innovation: Companies are able to understand the needs and wants of the customers and are able to make changes accordingly
2.Size of the organization : In terms of market share and distribution the size of the organization is very large.
3.Established brand loyalty : Most of the customers are very loyal and addicted, that they don’t even try any of other competitive products
4.Taste : The taste of the products are good and is available in different varieties
5.Price : Price of the products are very important because the customers who are not brand loyal have the tendency to look for the competitive products or substitutes
6.Global Expansion : Company is able to expand to any part of the world
1.One of the major opportunities of Coca-Cola as a company is to provide nutritional offerings to health conscious people because there is a shift of trend towards the healthy products and foods. The company has only introduced coke zero without sugar contents for such customers. That was the only strategy taken by company for the health conscious people.
2.The demand for the beverages has been growing mainly within the teenagers and the company is working a lot to meet this demand and to attract the customers. They spend a lot for advertising of their products to create awareness.
3.The company has a very good brand image in front of the customers. This brand image can be used for introducing new products to markets and the company has tried a lot to make a lot of changes in there strategies to develop new products. Thus it has increased the product portfolio.
1.The major threat of the company is the shift of the people towards healthy foods and drinks. The company has acquired the minute maid to produce fruit juices and thus attract the customers belonging o this category.
2.The next major threat is the lack of water which is the major raw material required for the production of coke products. The company is working a lot to replace it with a new product.
3.Key competitors can be also a big threat for the company. Pepsi and other major players are giving attractive offers to be competitive. Coca cola has developed superior strategies like better advertisements and product offers to gain major market share.
