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We can all proudly say for a beverage brand like COCA-COLA that nobody is unaware of it in the entire
globe as it has surely become a household name for all of us. It would be interesting for us to know
about its origin prior to know its critical marketing strategies and company¶s belief to make it up to this
stage. (http://inventors.about.com/od/cstartinventions/a/coca_cola.htm

COCA-COLA was discovered, we would rather say invented in 1886, just out of curiosity to know what
the mixture of certain ingredients does. It was John Pemberton, an Atlanta based pharmacist, who
created this amazing mixture of fragrant and caramel coloured liquid. He then took that mixture to the
nearest pharmacy to get it carbonated and the thing that came up is now has become a greatest known
brand in this world (http://heritage.COCA-COLA.com
.

In the initial stage, COCA-COLA had sold just 9 glasses a day for an entire year. But, a century later it
has produced nearly 10 billion gallons of syrup. After just three years of this invention, an Atlanta based
businessman Asa Griggs Candler acquired rights of the business and brand in just £1500. He then
became the first official president of COCA-COLA enterprise (www.ezinarticles.com).

As a natural salesperson Asa Candler started marketing the brand in 1893. He found out various brilliant
and innovative ideas of promoting the brand. He started distributing promotional coupons for
complimentary taste of the beverage, and outfitted distributing pharmacists with clocks, urns, calendars
and apothecary scales bearing the COCA-COLA brand. People saw COCA-COLA everywhere, and the
aggressive promotion worked. That was the start it needed and successfully achieved. Further the
company grown after its expansion to the other parts of US territories and of the world
(http://www.thecoca-colacompany.com/heritage/ourheritage.html

During its journey from 9 glasses a day to over 9 billion servings a day around the world,COCA-COLA
Company has struggled hard over time to safeguard the company and the brand. It has mainly focussed
on advertising as their main strategy for expansion. Many brand tags have changed from time to time
like ³Demand the genuine´ and ³Accept no Substitute´. It was to make customers aware of brand¶s
value and keep them away from buying substitute products of COCA-COLA.

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Let¶s remind ourselves, and do so continually, that research is for a purpose: to help us make decisions.
First, the big ones:

‡ How will we grow?

‡ How should we aim to compete?

‡ What will drive us?

‡ Who should we sell to?

And then the more tactical ones:

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‡What price?c

‡What quality?

‡How much to make?

‡ How to get the product to the customer?

‡ How to promote?

This focus will help us keep control over what can become a massive andnever-ending search for data.
Here¶s a useful rule of thumb on what constitutes µenough data¶. When we have enough data to enable us
to make these decisions, and sleep at nights, then that¶s enough data!(Cheverton, Peter 2004)

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We will use the following tools for analysing market situation.

¦c PEST Analysis
¦c Michael Porter¶s Five Forces

Ê   

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  Government has separate rules for the non-alcoholic beverages that fall under the
category of FDA and it operates actively in the manufacturing of such products by their terms and
regulations (Byars L, 1991). The following are some of the factors that could cause COCA-COLA
company's actual results to differ materially from the expected results described in their underlying
company's forward statement:-

¦c Changes in laws, accounting standards, taxation requirements in domestic and international

jurisdiction.
¦c Changes in the business of non-alcoholic business environment which inclu des competitive product
and pricing pressure and the ability to maintain global market share.
¦c Political changes in international market such as civil rest and restrictions on the ability to transfer
capital across borders.
¦c COCA-COLA¶s ability to penetrate in to the foreign markets which also depends on government
policies to acquire bottlers, suppliers, distribution network, infrastructure, etc.


#
"
 UK market economy has recently gone lower than most of the other partsof the world.
To cope up with this recession period, UK government has lowered its interest rates on borrowings which
made customers more interested in the market. COCA-COLA can borrow from the market and invest in
further increase in its product line or in research and development. This may lead in getting to further
increase in their market share and increase in sales. Though the same thing can competitors do, it has such
effect on either or competitive businesses (Jan Y, 2002).


 "
 Nowadays customers have become more and more health conscious. So, to keep matching
with the demand all major non-alcoholic beverage companies including COCA-COLA has turned to
manufacture bottled water or diet versions of their original carbonated drinks(Johnson and Scholes, 1993).

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 "
  With the excessive use of technology, some companies may stand out different
from the others in the market (Capron and Glazer, 1987) .

¦c Use of advertising tools such as internet, TV ads, etc. can make the product look more attractive
and can reach to potential customers easily and fast.
¦c Introduction of cans, pet bottles has made easy for customers to carry their favourite drinks
anywhere they want and can bin them away easily.
¦c Due to advancement in technology, COCA-COLA has started using easy vending machines at
public places like airports, train stations, etc. to make their product available easily.

"$"
   

The soft drink industry is very competitive for all corporations involved, with the greatestcompetition
being that from rival sellers within the industry. All soft drink companies have to think about the pressures;
that from rival sellers within the industry, new entrants to the industry, substitute products, suppliers, and
buyers. (Porter M, 1980)

The competitive pressure from rival sellers is the greatest competition that COCA-COLA faces in the soft
drink industry. COCA-COLA, Pepsi Co., and Cadbury Schweppes are the largest competitors in this
industry, and they are all globally established which creates a great amount of competition. Though
COCA-COLA owns four of the top five soft drink brands (COCA-COLA, Diet Coke, Fanta, and Sprite), it
had lower sales in 2005 than did PepsiCo (Murray, 2006c). However, COCA-COLA has higher sales in the
global market than PepsiCo. In 2004, PepsiCo dominated North America with sales of $22 billion, whereas
COCA-COLA only had about $6.6 billion, with more of their sales coming from overseas. PepsiCo is the
main competitor for COCA-COLA and these two brands have been in a power struggle for years (Murray,
2006c).

Brand name loyalty is another competitive pressure. The Brand Keys¶ Customer Loyalty Leaders Survey
(2004) shows the brands with the greatest customer loyalty in all industries. Diet Pepsi ranked 17th and
Diet Coke ranked 36th as having the most loyal customers to their brands. Refer to List 15 for the brand
loyalty rankings of the various competitors. The new competition between rival sellers is to create new
varieties of soft drinks, such as vanilla and cherry, in order to keep increasing sales and enticingnew
customers (Murray, 2006c).

New entrants are not a strong competitive pressure for the soft drink industry. COCA-COLA and Pepsi Co
dominate the industry with their strong brand name and great distribution channels. In addition, the soft-
drink industry is fully saturated and growth is small. This makes it very difficult for new, unknown
entrants to start competing against the existing firms. Another barrier to entry is the high fixed costs for
warehouses, trucks, and labour, and economies of scale. New entrants cannot compete in price without
economies of scale. These high capital requirements and market saturation make it extremely difficult for
companies to enter the soft drink industry; therefore new entrants are not a strong competitive force
(Murray, 2006c).

Substitute products are those competitors that are not in the soft drink industry. Such substitutes for
COCA-COLA products are bottled water, sports drinks, coffee, and tea. Bottled water and sports drinks are
increasingly popular with the trend to be a more health conscious consumer. There are progressively more
varieties in the water and sports drinks that appeal to different consumers¶ tastes, but also appear healthier
than soft drinks. In addition, coffee and tea are competitive substitutes because they provide caffeine. The
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consumers who purchase a lot of soft drinks may substitute coffee if they want to keep the caffeine and
lose the sugar and carbonation. Specialty blend coffees are also becoming more popular with the increasing
number of Starbucks stores that offer many different flavours to appeal to all consumer markets. It is also
very cheap for consumers to switch to these substitutes making the threat of substitute products very strong
(Datamonitor, 2005).

Suppliers for the soft drink industry do not hold much competitive pressure. Suppliers to COCA-COLA are
bottling equipment manufacturers and secondary packaging suppliers. Although COCA-COLA does not do
any bottling, the company owns about 36% of COCA-COLA Enterprises which is the largest Coke bottler
in the world (Murray, 2006a). Since COCA-COLA owns the majority of the bottler, that particular supplier
does not hold much bargaining power. In terms of equipment manufacturers, the suppliers are generally
providing the same products. The number of equipment suppliers is not in short supply, so it is fairly easy
for a company to switch suppliers. This takes away much of suppliers¶ bargaining power.

The buyers of the COCA-COLA and other soft drinks are mainly large grocers, discount stores, and
restaurants. The soft drink companies distribute the beverages to these stores, for resale to the consumer.
The bargaining power of the buyers is very evident and strong. Large grocers and discount stores buy large
volumes of the soft drinks, allowing them to buy at lower prices. Restaurants have less bargaining power
because they do not order a large volume. However, with the number of people are drinking less soft
drinks, the bargaining power of buyers could start increasing due to decreasing buyer demand (Murray,
2006a).

Porter¶s Five Forces Model identifies the five forces of competition for any company. The recognition of
the strength of these forces helps to see where COCA-COLA stands in the industry. Of the five forces,
rivalry within the soft drink industry, especially from PepsiCo, is the greatest source of competition for
COCA-COLA.

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COCA-COLA with every success in all major parts of the world, there are still few places where COCA-
COLA is approached by the local government to literally shut their business. Here we are talking about the
recent incidents happened with COCA-COLA Company India Ltd. The case was that a bottling plant of
Coke in a northern region of India was using excessive amount of ground water for the preparation of their
product which led to insufficient availability of water to the farmers for irrigation purpose(The Guardian,
25 July,2003). Moreover, the bio waste that Coke used to provide local farmers as fertilizers contained
heavily poisoned bio chemicals. Due to which the plants died and poor farmers had to suffer severe losses.
It went to the ears of government officials who approached Coke for further investigation. This scenario
has completely ruined the image and status of brand in India which is highly dominated by the other brand
of soft and fizzy drink Thums Up. Though Thums Up is a brand of COCA-COLA Company, India Ltd, it
still struggles to get their original brand start dominating the Indian market (Times of India, 1987).

Further, there were several claims that there are high contents of pesticides in Coke. This thing had come
like a biggest disaster in the Coke¶s business. Immediately after the claim, an NGO of India called
CSE(Centre for Science and Environment) started investigations and meanwhile informed the rural market
to avoid having it. This led to severe declines in sales figures of that year (CSE Report, 2003).

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Finally, Coke was claimed to create environmental hazards in India by not properly recycling or by
polluting environment. Among the available packages, people more prefer to have plastic pet or cans for
easy consumption and reducing cost.

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Coke had tried its best to come out of such situations very deliberately and with the use of right marketing
strategies.

"Ê! (

According to McCarthy (1960), in the marketing area, the most popular term is marketing mix. Marketing
mix is also known as !Ê). In marketing mix it includes price, product, place and promotion. Marketing
mix is the combination of all this four elements. Each element plays what part in promoting particular
product and service to the customer (Baker, 1999).

Some market researcher increase marketing mix to the five P¶s by including** in the marketing mix.

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There are number of ways to select the price for the farms but generally they are more depends on the
nature of the product. (Jobber, 2001, p. 12),Price selecting for the product or service is quit important
because when farms are selecting the price then price allows the product to be competitive with other
product and price also allows the product to be make good profit.

However price plays an important role in the market because some market has tough price war in
competitor¶s same feature product. (Brassington and Pettitt, 2003, p.26)

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Second P in the marketing mix is the product. Product in marketing mix means the service or the product
which is offer to the customer by the company. If we want to say in the physical attributes, we can say
what they do? How they do? And how the product and service is different from the company¶s
competitors? Finally we can said that what the benefit provided by this particular product to the
customer? (Brassington and Pettitt, 2003, P25)

   +'' the spot coat all to do among design, development and organization of the
product. This will also cover include non-physical part (such as customer care)

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Place is the mechanism where the company is going sell its product or service to their customer. We can
also say that place may be channel, distribution or intermediary. In other words we can say that Place
means product or service which offered by the company are moved from manufacture or service
provider to their customers (Baker, 1999).

In other word we can said that the main aim of the company when they are dealing with this portion is
product or service must be available at right place and in right quantities to fulfil the need of the
customer (Jobber 2001, p. 15)

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In the last part of the marketing mix and four P¶s is promotion. From the marketers point of view this
part is very important part in marketing mix. Because this tool is known as communication tools, when
company want to communicate with specific group of customer (targeted group) it is going to very use
full weapon for the company. For the promotion, company have many option to communicate for
example advertising, personal selling, sales promotion, direct marketing, publicity etc. (jobber, 2001,
P.15, M. Baker)

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According y to Philip kotler value chain is play one of the important role in the marketing strategy.
Because to be success in the particular area, all the departments need to be work all to gather. Each of
the company¶s department can be consideration of as a link between differentdepartments to be success
in their area. That means each department of the company take value creating activity such as design,
innovation, market selection, stock delivery, customer care etc. the success of the company is depends
not only how each department do in their area particularly but also how different department of the
company is do coordinate to be success.(Philip kotler, 12th edition pg no 45-47)

Generally company work as a team and the main goal of the company is to be satisfied their customer as
possible as they can. But in some case in some company, different department¶s relations are
completely clash and full of misunderstanding with each other. There is make negative point for the
company to be success because if different department not coordinate with each other properly then
company gives chance to competitors, to be success agents them.(Philip kotler, 12th edition pg no 45-
47)

The chance of the success of the company is increase when company has good as well as manage value
chain system. Company must come across the way to work all departments with each other as properly
as they can do. Company must build up value chain between different departments. For example
manager of marketing department need to build up relation between different department and try to
make some plane under which all the department can work all to gather and try to meet the goal of
company which is customer satisfaction. (Service marketing pg no 31-57)

Example of good value chain is when production departmentis ready to arrange the product as cheap as
they can so that they can increase the customer number. On the same time marketing department is
make some strategy to marketing that product for the brand awareness in the group of customer. In this
case of example both marketing department and production department are work to gather to be success
for the company. Example of good value chain is . In COCA-COLA all department are work all to
gather to be success (strategic management pg no 305-307).

##
  

A strategic communications model that incorporates an understanding of Coke India¶s objectives,

constituencies, and channels should be used to analyze this case. This frameworkwill appreciate that
objectives drive both the right strategy and the best execution of that strategy. In addition, the
communication strategy should incorporate a framework for managing reputational risk, underscoring the
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link between reputational capital and corporate performance. In this case, COCA-COLA¶s clear, primary
objective is to regain the trust of consumers, the media, and the government but it has many secondary
objectives as well (Kenneth and Donald, 2007). These include:

‡ Reassuring the global community, specifically global consumers of COCA-COLA products as well as
investors in the COCA-COLA Company
‡ Leveraging the situation to gain competitive advantage and precious reputational capital through
addressing the charges in a responsible and thoughtful way

‡ Resolving this issue thoroughly, beyond the hype ofthe moment, so that it does not arise in the future and
hamper business in the critical Indian market
After articulating the Company¶s objectives, we should explore the execution of a communication plan.
Who are the most important constituencies? How do they rank and how should you prioritize them? What
are the best channels to use for each? What is the timeline of the communication messages needed (ie
which are short-term and which should be ongoing)? What are the opportunities for increasing reputational
capital? What safety nets should be put in place to manage reputational risk?


1. Communicate openly with key constituents, including the public, the media, employees,franchisees, the
trade/channel, state and national government, and suppliers. Open, honest communication is a key to
communicating a spirit of partnership and a willingness to resolve the issue in a way that benefits the Indian
consumer.

2. Attempt to collaborate with the CSE, acknowledging that your goals may be closertogether than you
initially imagine. Take the time to discover their true motivation, ultimate goal, and ideal outcome.
Recognize the enormous reputational benefits that could come from such a partnership, or even a
willingness to partner.

3. Choose to differentiate as a more socially responsible company. Though a united frontfor Coke and Pepsi
was a successful tactic when the crisis first broke, now is the time to take advantage of an opportunity to
demonstrate leadership in a sphere that is critically important to your key constituents.

4. Enhance your relationship with the government. Whether or not a relationship with theCSE is possible,
the government will be closely involved in developing the new standards that Parliament has demanded.
Strong government relations are important in India and give you an opportunity to communicate all the
benefits and investments you provide to the economy.

5. Recognize the upsize for reputational risk on a corporate level if the situation can beturned into a
positive. By correcting the pollution in India and alleviating tensions at the local level, The COCA-COLA
Company has made a deposit in its global reputational capitalaccount.

6. Launch a campaign (which they did: eKO) to educate the public, the government, andthe media about
environmental stewardship activities.

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This case study allows us to push on the definition of truth for corporations. Did Coke "tell the truth" by
sticking to the facts, or does truth imply a greater responsibility? Is truth sticking to the letter of the law or
accountability to a higher standard? The COCA-COLA case also blurs the distinction between truth and
facts. The CSE, the government, and Coke all had different facts regarding the nature and degree of
pesticides in soft drink products; what does a company do when the truth is not black and white and
consumers form their own truths on the basis of perception?(www.pagecentre.com.psu.edu)

Ê$.


At the time of the case, Coke falls short of meeting this principle, which contributes to the continued erosion
of consumer confidence in the company and its products. Collaboratingwith Pepsi to address the issue was a
good first step, but Coke falls short of actions that demonstrate a commitment to problem resolution and
product safety including collaboration with the CSE or independent, transparent product testing. After the
time of the case, the Company launched COCA-COLA India eKO Management System, an initiative to
translate environmental policy into action in daily operations. This action was important in the process of
rebuilding reputational capital and regaining public trust.

,
#

Coke is forced to listen to the customer because they have spoken with theirwallets. With sales down over
30% in less than two weeks, the company knows customers are concernedabout this issue. At the same
time, Coke needs to hear the customer's voice to motivate themto the next level of responsibility: even if the
company is technically 'in compliance' with legal standards, customers demand and expect more from a
company with COCA-COLA's reputation.

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Coke missed this opportunity in the past by ignoring the Kinley bottled water crisis but canredeem itself by
taking a long-term perspective on resolving the current situation. India is one of the company's most
important markets for the future and the company must take this into account when considering the
investment needed to thoroughly resolve this crisis. By taking a long-term perspective on its reputational
capital, both in India and around the globe, the best response for COCA-COLA becomes clear.


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In Coke's case, with over half of its market value attributed to the brand, the whole company really does
depend on PR and the company's image. Many would say that Coke is builtalmost exclusively on image,
which implies an important focus on public relations.


#* 
 
(*'**

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Sanjiv Gupta was an admired leader who knew the Indian consumer. He became thecompany's face during
the crisis and was an important reminder that Coke in India was more than just a faceless MNC.

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This case will give us the opportunity to think about the importance of projecting calmand confidence in the
midst of a crisis
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##  

Looking towards the future, the most important recommendation to COCA-COLA is continuing product
innovation and expansion of their product line. The soft-drinks industry is fully saturated with competitors.
Also, the industry is no longer expanding, and market share is actually decreasing as more consumers are
looking to healthier options. By continually introducing new products, COCA-COLA will be able to
increase their profits and allow the company to continue to grow. Also, having a diverse product line will
make the corporation very stable, which is appealing to investors andcreditors.

A second recommendation would be to sustain or increase the global market share.COCA-COLA is very
well-established globally, and is the global soft-drinks leader. This is very important to sustain because it is
the source of the majority of their profits. If they lose global market share, their profits will decline
dramatically.
A final recommendation for COCA-COLA is to maintain and try to increase their brand loyalty. Diet Coke
has the second highest brand loyalty of all the soft-drink competitors¶ brands, and solid advertising
campaigns will help maintain the brand loyalty. They can also strive to obtain higher brand loyalty in all
other brands, not solely Diet Coke. The brand loyalty is important because it will allowCOCA-COLA to
sustain profits and maintain their market share.


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"

 

American Beverage Association (2005). a

. Retrieved February 21, 2006 from
http://www.ameribev.org/variety/facts.asp
Cadbury Schweppes. (2004). 
 Retrieved February 17, 2006 from
http://www.cadburyschweppes.com
Datamonitor. (2005, May).  
a

. New York. Reference Code:
0199-0802.
Hein, Kenneth. (2004). 
 
 Retrieved February 12, 2006 from
http://www.brandkeys.com/news/press/102504Brandweek.Loyalty.pdf
Murray, Barbara. (2006a). The COCA-COLA Company. Hoovers. Retrieved February 13, 2006,
from http://premium.hoovers.com/subscribe/co/factsheet.xhtml?ID=10359
Murray, Barbara. (2006b). Pepsi Co. Hoovers. Retrieved February 13, 2006, from
http://premium.hoovers.com/subscribe/co/profile.xhtml?ID=11166
Murray, Barbara. (2006c). Carbonated Beverages. Hoovers. Retrieved February 13, 2006, from
http://premium.hoovers.com/subscribe/ind/overview.xhtml?HICID=1049
Murray, Barbara. (2006d). Cadbury Schweppes Inc. Hoovers. Retrieved February 13, 2006,
from http://premium.hoovers.com/subscribe/co/profile.x html?ID=41767
Murray, Barbara. (2006e). Comparison Data. Hoovers. Retrieved February 13, 2006, from
http://premium.hoovers.com/subscribe/co/fin/comparison.xhtml?ID=10359
PepsiCo Inc. (2004). 
 Retrieved February 17, 2006 from
http://www.pepsico.com
Sicher, J. D. (2005).  
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$%
&a

 Retrieved
February 10, 2006 from http://www.beverage-digest.com/pdf/top-10_2005.pdf 25
The COCA-COLA Company. (2004). 
 Retrieved February 17, 2006 from
http://www.cocacola.com
Walker, Tim. (2006). Cott Corporation. Hoovers. Retrieved February 13, 2006, from
http://premium.hoovers.com/subscribe/co/profile.xhtml?ID=42846
"Coca-Cola India." Coca-Cola India. 27 Sept. 2008
http://www.cocacola.com/template1/index.jsp?locale=en_in

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Datamonitor (2005, May).  

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. New York.
Reference Code: 0199-0802.

Datamonitor (2005, May).  

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. New York.
Reference Code: 0199-0802

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Datamonitor (2005, May).  
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. New York.
Reference Code: 0199-0802.

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