The Coca-Cola Company
Introduction
The Coca- Cola company is a multinational company dealing with manufacture and retail marketing of nonalcoholic beverage and syrups. Incorporated in 1892, the Coca- Cola company has its headquarters in Atlanta, Georgia. Over 31,000 employees around the world work in the Coca- Cola company and its subsidiaries. The company offers numerous brands across the world. According to the company’s report, more than 500 Coca- Cola brands are distributed over 200 countries. The company’s first attempt to manufacture soft drinks was in 1963. Tab was the first soft drink to be manufactured by the company with the use of saccharin in place of sugar. The product is still in the market even though its sales have dwindled over the years as a result of many substitutes available in the market. The company also produces other soft drinks such as Fanta and Sprite. The company has faced stiff competition from PepsiCo in the manufacture of carbonated soft drinks (CSD). As a result, the company has embarked on various strategic measures to facilitate diversification and increase production and performance (Hays, 2010).
Operating Structure
The Coca- Cola company operating structure consists of various geographical groups across the world. There are five of these groups exclusive of the minute maid company. They include the following:
- The North American group which includes the United States and Canada
- The Latin American group comprises of operations in central and South America.
- The Greater Europe group which stretches from Russia to Western Europe.
- The Africa and Middle East group comprise of the Middle East and the entire African continent.
- The Asia pacific group has its operations stretching from India across pacific region.
- The minute maid company forms the largest marketer of juice drinks (Pendergrast, 2013).
Production Activities
The Coca- Cola company is involved in the production and distribution of non-alcoholic products around the world. The company has demonstrated great strength in conducting business locally and across international boundaries. The production of soft drinks gained a reputation for the company as the best selling company in 2001. According to the company’s reports, the company has offered a large number of employment opportunities to the locals and the entire world in general. Most of the company’s supplies are acquired within the region thus creating the development of supplier industries. In 2010, the Coca- Cola company bought interests in Coca- Cola enterprises giving the company over 90% control of the North American volume. The Coca- Cola enterprise is the primary bottler contracted by the larger Coca-Cola. The distribution and supply of soft drinks by the company is done at a discount to large grocers and restaurants. They later sell the products to consumers at a bargain price. Large grocers buy soft drinks in large volumes enabling them to buy at lower prices. By contrast, restaurants usually have a relatively less bargaining power to large grocers since they do not buy in large volumes (Pendergrast, 2013).
Marketing Activities
Apart from investing in the manufacture and distribution of Coca- Cola products, the company is also involved with significant exposure of their trademarks. The company has laid strategies on campaigns and programs that are aimed at appealing the consumers. Some of the practices involved in marketing include product sampling, advertising, and point of sale merchandising. The company has developed an integrated marketing mix with other bottling investments and alliances in the market. In the marketing of its trademarks, the company undertakes market research on its product in order to establish consumer brand positioning through feedbacks. The Coca- Cola company invests a lot funds in advertising of its products to ensure awareness of products to consumers around the world. Through advertisement, the company improves its production and sales performance (Lopez, 2011).
Trends in the Industry
Trends in the company’s carbonated soft drinks are brought about by the increase in the health concerns and expansion in the international markets. The Coca- Cola company soft drink sales are approximately 60% of the entire company’s revenue. According to the company’s reports, the Coca- Cola company had over 60% of the $39 price estimates. The consumption of carbonated soft drinks has raised a lot of health issues among the consumers. Health institutions have emphasized on the risk of soft drinks to human health. As a result, consumers have dropped their consumption of carbohydrate soft drinks. This has significantly affected the company’s profitability and performance. The shrinking of soft drink sales has been experienced in some of the developed markets of Western Europe and North America. As a result, the company has embarked on strategies aimed at producing safe and healthy soft drinks (Hays, 2010). The Coca- Cola company has focused on increasing market spending on Coca- Cola products. The PepsiCo which is a close rival of the Coca- Cola company has also engaged in a fierce competition. In 2011, the Coca- Cola company increased its spending by 10% in an aim to increase its sales (Lopez, 2011). Production of healthy Carbonated Soft Drinks (CSD)
The company has also turned its focus on production of healthier varieties of carbonated soft drinks (CSD) as a result of the high health issue concerns. The decline in consumption of carbonated soft drinks in the western markets has been as a result of health issue concerns over the ingredients used in their manufacture. The company has embarked on the production of products with low calorie for its strategy to retain the market for its products. In 2011, the company succeeded in producing and selling of diet coke. The product was second best selling CSD in the United States (Pendergrast, 2013). Increased demand from emerging economies
Trends in the company’s soft drink have also been caused by an increase in demand, in the emerging economies. The high economic growth experienced in developed countries has contributed to high disposable income among individuals. As a result, there has been an increased demand in the consumption of carbonated soft drinks in countries such as China, India, America, and Brazil. The company anticipates increased demand for the products in the near future (Lopez, 2011).
Company’s Highlights
The company has, over the years, increased its productivity and efficiency in marketing its products across the world. As a result of increased demand for Coca- Cola products, the company has laid strategies on diversification of products in order to increase area coverage of its products. The Coca- Cola company has been responding to customers’ demands positively through manufacturing of products in line with consumer interests. In 1990, Coca- Cola company introduced several non-carbonated beverage products in the market. For instance, the company introduced minute maid, Nestea, Fruitopia, Dasani, and Powerade among others. The introduction of these soft drinks in the market led to higher sales and profits in the company. In 2001, a division of Coca- Cola company, minute maid, introduced Simply Orange juice products in the market. In response to customers’ criticism, the company introduced low-carbohydrate drinks such as the Atkins diet and diet coke. In 2010, Coca- Cola company was recognized as the best soft drink selling company across the world (Hays, 2010).
References
Hays, C. (2010). Pop: Truth and Power at the Coca- Cola Company. New York: Random House.
Lopez, D. (2011). Brand Development of Coca- Cola Company (UK). Norderstedt: GRIN Verlag.
Pendergrast, M. (2013). For God, Country, and Coca- Cola. New York: Basic Books.
