Highlight of the Case
The case study narrates about the marketing progress that Coca-Cola has entrenched since inception to date. Principally; this giant multinational company hit an iconic state after undergoing several global marketing trials, with each episode generating challenges and opportunities. Based on this case, the first recorded incident of Coke’s prosperity was marked by the contract awarded by the American government to supply coke products during the Second World War. Because of this contract, the company gained experience of the international markets, and for the first time installed 63 bottling brands. For the entire operational period before 1980, Coke had relied on localization policies, but it was changed under the leadership of Roberto Goizueta, who introduced a policy referred to as one-size-fits-all strategy that saw a fruitful globalization to its products. Due to the success attributed to this policy, Douglas Ivester succeeded Goizueta alongside his strategy. The failure of the One-size-fits-all policy by Ivester led to his resignation, and he was succeeded by Douglas Daft, who introduced the 180-degree shift policy; this was a more centralized move than the Ivester’s strategy. In 2002, a hybrid policy comprising of Goizueta and Daft’s policies, which spurred it to its current success state; Neville Isdell pioneered this policy.
Question 1
Goizueta’s decision to globalize coke’s product was informed by the experience of the Second World War. Initially, Coke had held to a centralization policy that only encouraged operations within the US market. However, the occurrence of Second World War was an opportunity in disguise for Coke to exercise its operations in the international market. Therefore, Goizueta’s entry at the helm of management in Coke coincided with the success following Coke engagement in the Second World War, which created several international opportunities to the company. Globalization was favored by the fact that there was little penetration of Coke in the global market, which then had weak competition. Indeed, globalization strategy had several benefits to coke during this period; it offered an opportunity for the company to expand its operations in the international market, which generated more profits and revenues. Besides, this strategy led to the diversification of coke to more products as an impetus to higher sales.
Question 2
Goizueta’s One-size-fits-it-all or centralization strategy lost steam since it became an easy target for small local beverage companies, and as a result halting Coke’s growing influence in the international market. Thus, centralization was no longer viable and had significant challenges to the company that needed more diversification and autonomy at the local levels. Therefore, Daft had to revamp the managerial strategy at Coke and instead replaced the older system by a new system based on globalization. This move was aimed at scattering competition while ensuring that Coke remained viable in the local markets. I think this idea did not yield the much-needed profits since the markets did not need a comprehensive overhaul to the first managerial idea, but somehow a hybrid system.
Question 3
The strategy pursued by Coca-Cola under the leadership of Neville Isdell was accommodating and all-inclusive of product and market development of coke in the international market. As a hybrid system, the strategy gave some powers to the local producers, while operating under the company’s centralized system. Coke’s idea to embrace hybrid system to the previous policies was meant to subvert market collapse in the international scene that experienced dynamic forces. This strategy was distinct from the previous strategies since it integrated both the centralization and globalization strategies. Its benefits include flexibility in the market to either policy. The risk and cost of implementing this policy were attributed to the perceived standoff that could emanate between regional and central managers in Atlanta; this could hamper product development.
Question 4
Evolution of Coca-Cola strategy signifies that customers have both spatial and collective preferences to certain brands. Certain brands have international appeal, and regardless of the region or cultural backgrounds, such products will be consumed in equal measures. On the other hand, certain products are specifically tailored for some regions, and might not have a higher traction in other geographical areas.
