Executive Summary
Dynamic internal and external environments of a business have serious impacts on its growth. These changes have caused a drop in the sales of the company. Coca Cola Company has to change its generic strategy in order to keep up with competition and maintain its position as the leading non-alcoholic beverage-producing firm in the world. The company’s strengths, weaknesses, opportunities and threats have changed. Coca cola’s strength is on advertising and global customer satisfaction. Its weakness is the perception that their beverages are unhealthy and classified as junk. Several opportunities are presenting themselves in the Asian market, and the need for healthy drinks to promote healthy lifestyles. The company’s major threat is Pepsi which has diversified into snacks.
The company’s current mission is to provide refreshments for its consumers, enhance happiness and customer satisfaction. The company is looking forward to double its sales by the year 2020. This can only be achieved by changing the company’s generic strategy as well as its mission. In line with the SWOT analysis, the company should come up with new mission that is embedded in healthy lifestyles and diversification of its products.
Introduction
A company’s generic strategy should correspond to a company’s weaknesses, strengths, opportunities and threats. In module 3, we performed a SWOT analysis of Coca Cola Company which are also referred to as strategic choices. This is a continued case study of the coca cola company. The coca cola company’s external and internal environments have changed over the years, and the company also needs to change its generic strategy. The company’s generic strategy does not correspond to the company’s current strengths, weaknesses, opportunities and strengths. This paper will describe the discontinuity between the company’s generic strategy and its SWOT analysis. The company has been experiencing, a drop in sales due to its products health related issues. This paper will come up with a new generic strategy for the company that will enable the company double its sales by the year 2020.
Main Body
Coca Cola Company applies the differentiation strategy . According to porter, this strategy offers unique products in order to target a wider market. Coca Cola Company offers great advertising that suits all cultures. The company’s brands have brand equity which ensures customer satisfaction across the world. Their products and adverts are known to bridge the socio-cultural differences.
The company’s strength is in marketing strategies. The company, has an ability to come up with adverts that conform to all cultures . Pepsi, coca cola’s leading competitor, has been trying to adopt this strategy without luck. The company is also known for brand equity. Coca cola achieves customer satisfaction across the globe. This has earned the company customer loyalty, which enables the company to command a large percentage of the non-alcoholic beverage market share.
The company’s opportunities include the increase in consumption of non-alcoholic beverages in Asian countries. These countries are characterized by very high population. This poses as a new market that can be exploited by the company. The need for healthy life styles has also brought in a new market for healthy drinks. By producing healthy drinks, the company can increase its market share.
Coca cola’s strategic choices does not align with its generic strategy. The companies generic strategy is differentiation, which according to porter, stipulates the uniqueness of products to reach a wider market . However, most consumers would not distinguish Pepsi from coca cola, if they are served in identical glasses.
Coca cola’s major strength is the ability to devise adverts that conform to all cultures. They also ensure customer satisfaction across the globe. The company can leverage these strengths to open up new markets; for example, Asian countries such as China and Asia. Its brand equity can be used in order to market its brands as global brands.
The major weakness is that coca cola products are categorized as junk and unhealthy . This perception was built after a failed attempt to launch a coca cola branded water bottle, Dasani, in the UK in 2004. Two months after the launch, concerns were raised over the high levels of bromate found in the water, which posed a risk of severe side effects such as cancer. Coca Cola Company should invest heavily in restoring the company’s products as healthy. The company should build a generic strategic that focusses on producing healthy brands with reduced calories, and low sugar.
The company has various opportunities which it can exploit. The Asian countries specifically India and China, have increased their consumption of non-alcoholic beverages . The population in these countries is very high which means that this is an untapped market. The company should expand its boundaries to these countries. By using its unique and socio-cultural compliant adverts, the company can possess and tap a big part of this market share. There is also rising demand for healthy drinks. The company should focus on owning a market share of the healthy drinks that is on the rise.
Coca cola’s leading threat is Pepsi. This is attributed to the company’s diversification into the snack market . While coca cola offers beverages only, Pepsi offers snacks to be taken with their beverages. Coca cola should eliminate this threat by venturing into snacks that can be taken with their soft drinks. Coca cola and the entire non-alcoholic beverage industry is faced by a major threat, with consumers preferring healthy lifestyles, something that is currently not offered by the carbonated drinks. Coca cola strategic choice is to diversify into the healthy drinks business and offer its consumers healthier drinks that are carbon free.
Currently, Coca cola’s mission is to refresh the world, create moments of optimism and happiness, and make a difference by creating value. The company’s vision is to provide a work place that ensure the growth of its employees, producing high quality brands that ensure customer satisfaction, create value for all its shareholders, build sustainable communities, maximize returns and ensure and sustain continuous growth. The company’s mission should change to promote a healthy life style by introducing healthy drinks into the market, and achieve customer satisfaction by diversifying into the snacks market. The company’s vision should change to one that is aimed at promoting healthy lifestyles.
Conclusion
In conclusion, a company’s strategic choices determines its success. These strategic choices are influenced by both external and internal environments of a company. These choices can be formulated from a proper SWOT analysis. A company’s mission and vision is derived from these strategic choices which in turn are used to formulate a proper generic strategy. The ultimate generic strategy is one that perfectly aligns a company’s mission, strategic choices and its generic strategy. Although it is difficult to perfectly align these three aspects, discontinuities should be minimal.
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