According to O'Brien & Marakas (2010), “smart retailers are going where it’s warm: the hot little hands of cell phone and laptop-toting customers who want to shop right now” (351), in order to beat the biting recession. Effectively, in order for companies to tap into the changing market, technology-backed initiatives geared at boosting these companies’ revenues have included mobile electronic commerce, text message coupons and social media shopfronts have been established. This passage speaks of both the changes in technology, and the changes in the consumer behavior, in the face of intensifying competition across numerous fronts. The change in consumer behavior is driven both by the options availed by technology, its capability, coupled with the convenience that the technologies offer. Even most importantly, the context of this case is a recession, and the fact that many consumers are opting to shop only because of difficult economic circumstances. This points to the fact that electronic commerce results in considerable cost savings for firms, which is in turn passed on to the consumers. Even if the cost savings are not passed to consumers, the ease with which they can compare value propositions from different firms means that they can still get the best value for their money by comparing offerings from different firms, because they are not limited by the geographical constraints that often characterize physical stores.
Online retailing has risen at an increasingly fast pace in the US and elsewhere in the world. According to MarketLine (2015), the major factors behind the rise of electronic commerce include cost savings (resulting from low infrastructure costs) and convenience. The US Department of Commerce reports that online retail sales, adjusted for seasonal variations accounted for upwards of $263.3 billion in the year 2013, representing a more than 16.1% increase since 2010. The segment is expected to expand even further, due to the increasing proliferation. With regard to convenience, O'Brien & Marakas (2010) points to the growing need for customers to shop from wherever they are. This shows that mobility is increasingly in sync with modern lifestyles, but also that customers are more pressed for time than is necessary to shop traditionally.
In order to support these emergent trends, firms firstly need to invest in both electronic and mobile commerce, while at once investing in the infrastructure necessary to encourage/leverage shopping. O'Brien & Marakas (2010) points to infrastructures such as mobile banking, hospital and college portals, e-book readers and electronic payments systems that make it easy for customers to make payments. E-commerce enabled websites are not enough, they must be o[ptimized for mobile phone users, and above all, they must be easy/convenient to use. Since customers want to shop wherever they are, physical stores can attract these customers by having facilities such as Wi-Fi. As perhaps best demonstrated by Starbucks’ strategy of using technology as a w ay to add value to its services, which attracts clients to the shop, even though the company may not necessarily make money off the online sales while the customers are on the premises.
With the developments in mobile computing power as well as that of mobile computing devices such as tablets has also made it possible to develop numerous applications that add to these devices functionality and relevance to businesses. To this end, the case study notes that while people can lose their credit cards and forget their wallets, but they are unlikely to lose their phones. “There is perhaps no combination of vices so bursting with the commercial promise that that of cell phone-plus-caffeine” O'Brien & Marakas (2010, p. 352). The case study notes this in relation to Starbucks’ impressive use of innovative mobile payments systems that allow clients to make payments using their smartphones. Starbucks mobile payments systems solve a critical problem that the case study refers to with regard to experimentations with social media storefronts. These store fronts seek to tap into the impulsivity of customers, and the fact that practical factors such as credit card details or the need to redirect to a vendors’ website tend to inhibit the willingness of the consumers to proceed with the payment. If the purchase decision can be as easy as liking someone’s Facebook Post or retweeting a comment they have made, then it is possible that businesses can cash in on social buyers. With mobile mobile payment systems, the need to remember credit card and bank details is eliminated, and the systems are seamlessly linked to the social media shop fronts such that it is possible to make a purchase with one or two clicks. Barcodes such as those incorporated in Starbucks systems make it even easier to for clients to transition between the online market to the physical market, since instead of using credit cards, they can simply have barcodes on mobile phones scanned.
While this case study was written when Facebook had barely a million users, the site currently has upwards of 1.2 billion people, with as many users on other sites such as Instagram, Twitter, and even individual mobile phone applications such as WhatsApp Messenger. Millions of people have email accounts, many of which are accessible through mobile phone applications. As it is evident in this case study, increased competition, options, and time scarcity has shifted the balance in favor of consumers. However, the existence of a disconnect between the virtual world and the real world prevents the online market from capitalizing on the increased online traffic. People browse different websites on their phones, see great books, clothing items, gift items, and other products, but they can only bookmark them and promise themselves to look them up next time they go to the store. As with the example birthday flowers given in the case study, mobile payment systems will eliminate this gap, allowing customers , to make instantaneous purchases. To facilitate this, businesses need to cut back on the steps necessary to make purchases and the requirements, re-engineer loyalty programs and other support services to ensure that the mobile shopping experience is as close to reality as possible.
Coca-Cola Company is easily one of the largest beverage companies in the world. The company is involved in the manufacturing and distribution of non-alcoholic beverages with operations across the world. The company’s beverages include non-alcoholic, ready-to-drink drinks with and without carbonation, energy drinks, juices, tea, and coffee. Coca-Cola provides sweeteners, flavouring and other ingredients, and fountain syrups under the Coca-Cola, Coca-Cola Zerom Coca-Cola Light, Diet Coke, Fanta, Minute Maid, Powerade, Georgia Schweppes, Dasani, and Gold Peak among other brands. To reach its diverse market, Coca-Cola employs a network of bottlers and distributors across the world. Even most importantly, the company’s global success is largely due to its successful marketing, which has included the company's excellent management of its online reputation.
The company’s driving determination is that the market gets information from it, as against from third parties has ensured that it is proactive in its marketing communications. Social media is central to Coke’s marketing, and to underscore this importance, the company has an official social media policy by which all its 150,000 associates must abide in order to sell the company’s reputation consistently. This policy is founded on three principles, which include awareness of the Coke brand, the need to inspire happiness and optimism, as well as common sense and sound judgment. Its social media and other online communications must be grounded in its organizational commitment to transparency, protection of consumers’ privacy and respect for the rule of law, responsible and ethical use of technology, respect for intellectual property rights and reasonable behaviour monitoring.
Similarly, its officers and agents are trained and required to abide by the strict guidelines when engaging with the public. By this strategy, Coca-Cola ensures that it has a team of committed, consistent and expert social media and online communications agents that sell the company appropriately. This way, it can turn its huge workforce, into marketing agents through their various social media engagements both through its social media pages as well as through their other social media engagements. Firstly, the company has made certain that it establishes a meaningful presence across different social media sites. This was mainly accomplished through sponsored/paid promotions of the company’s pages/handles, especially at the earliest stages, which ensured that its social media pages have a critical mass. Currently, Coca-Cola brand has upwards of 91 million Facebook Likes, 125 million YouTube Views, 3.05 million Twitter Followers among other major sites. The company has had diverse strategies on specific social media sites as well.
On Facebook, the company’s heavily relies on the provision of content, including influential videos that are shared by fans on their own pages and other social media sites. This page has some of the most exciting content about the Coca-Cola company including its sponsored events such as the women’s FIFA World Cup and other popular events, coupled with some exciting crowd generated content that in turn ensure that the content goes viral. Crowd-sourcing popular content has the advantage of being cheap for the company (unlike the expensive marketing campaigns), but the page administrators ensure that these messages are in tandem with the company’s brand. In addition, other than the main brand page, Coca-Cola has Facebook pages for each of its brands e.g. Diet Coke, to ensure a more focused brand information is given to the market.
The company also uses its Crowd-sourcing of content is also the dominant strategy on Twitter, which, however, has a greater emphasis on separate handles for brands, including handles for country-specific bottlers and distributors. Despite the diversity, the message across its Twitter handles, as its Facebook pages is the same and centered around spreading happiness, refreshment and other aspects of its core social media policy. Even most importantly, the company has an emphasis on direct engagement with consumers, and a look through its various social media pages shows that the company’s representatives take time to reply directly to pressing issues from the page users, including responses like “we love you too” and “we are excited you like Coke Zero’s new flavor”. Similar strategies, as employed for other media sites, include Tumblr, Instagram, and YouTube.
Effectively, it is evident that Coke’s online reputation management builds on a number of factors. These include its insistence on the integration of all its marketing information to ensure consistency across all channels and prioritization of social media. The social media strategy (including its official policy on the same) shows the company’s savviness with internet, but perhaps most importantly, its willingness to embrace changing media technology that it has had for over a century of its existence. Its social media strategy are heavily reliant on crowd-sourcing of content and direct interaction with the consumers.
References
Anderson, E. (2010). Social Media Marketing: Game Theory and the Emergence of Collaboration. New York: Springer.
Bell, L. (2003). The Story of Coca-Cola. New York: Smart Apple Media.
Coca-Cola Company. (2015). WHAT SOCIAL MEDIA MEANS TO US. Retrieved July 27, 2015, from http://www.coca-colacompany.com/stories/online-social-media-principles
MarketLine. (2015). Starbucks Corporation. New York: MarketLine.
MarketLine. (2015). Wal-Mart Stores, Inc. New York: MarketLine.
MarketLine. (2015a). Coca-Cola Enterprises, Inc. New York: MarketLine.
O'Brien, J., & Marakas, G. (2010). Management Information Systems (10th ed.). New York: McGraw-Hill Companies, Incorporated.
Shively, K. (2014, May 22). Lessons from Coca-Cola’s Social Media Strategy: Cohesive Campaigns and Creative Content. Retrieved July 27, 2015, from http://simplymeasured.com/blog/2014/05/22/lessons-from-coca-colas-social-media-strategy-cohesive-campaigns-and-creative-content/#i.19ejppc1052drh
