(Tiểu luận FTU) MARKETING STRATEGY OF COCA – COLA

Like other companies, Coca-Cola bases its marketing strategy on the well-known marketing mix of the “4Ps”: Product, Price, Promotion and Place.. Strategy  Coca-cola is unique in the way

FOREIGN TRADE UNIVERSITY ENGLISH FOR SPECIFIC PURPOSE FACULTY

INTERNATIONAL BUSINESS ASSIGNMENT TOPIC: MARKETING STRATEGY OF COCA – COLA

Teacher: PhD.Nguyễn Thu Hương Class: TAN432(2-1920).5

Group 7:

Nguyễn Thị Thúy Hiền 1711110245 Hoàng Xuân Mai 1711110445 Nguyễn Thị Thắm 1711110612

Tô Thị Hoài 1711110277 Đặng Thị Phương Linh 1711110373 Trần Thu Nga 1711120114 Phạm Thị Thu Hằng 1711110223

Hanoi, March 12, 2020

TABLE OF CONTENTS INTRODUCTION

1. 3

2

1.1 3 1.2 3 1.3 3 1.4 4 1.5 4 1.6 4

2. 5

2.1 5 2.2 6 2.3 6 2.4 7

3. 8

3.1. 8

3.2. 9

3.3. 12

3.4. 14

As the world‟s third most valuable brand, Coca-Cola is also one of the most successful Its products are available in every country, and through the gray market, this also includes Cuba and North Korea

Having a marketing strategy uniquely designed for the company has given it a huge boost at increasing global brand recognition

Like other companies, Coca-Cola bases its marketing strategy on the well-known

marketing mix of the “4Ps”: Product, Price, Promotion and Place However, due

to the uniqueness of the company‟s brand, we‟ve mixed things up a bit by including other, more subtle reasons behind the company‟s success and the uniqueness of the brand

Our essay includes 4 sessions:

Session 1: Introduce about Coca-cola Session 2: Marketing mix in general Session 3: 4P- Elements

Session 4: Conclusion & Quizzes

We hope to get your evaluation for improving our essay!

1 Coca – Cola in general

1.1 About the company

 The Coca-cola is one of the largest beverage coporation in the entire world

 The main products are their wide variety of soft drinks

 In recent years, Coca-cola has had an average about $46 billion dollars in sale and revenue per year

 After all of the deductions, Coca-cola has accumulated an average of $ 8.5 billion in net income

 Estimated 123200 employees

 Coca-cola is on a New York Stock Exchange with a current stock value of $ 43.53 per share

1.2 Mission

Coca-cola‟s mission statement is “To refresh the world in mind, body, and spirit

To inspire moments of optimism and happiness through our brands and action”

1.3 Strategy

 Coca-cola is unique in the way they brand their soft drink product

 Those who are marketing for Coca-cola focus heavily on having that strong relationship with its customers, and so they create their brand to focus on the happiness that their products bring

 Coca-cola keeps their drinks at a low price so that their customers may enjoy the drinks regularly

 Remain consistent in their quality and service of their products over time

 Design has been renovated and recreated over the years to keep up with capturing their customer‟s attention

 Coca-cola not only sells soft drinks, they sell happiness Their marketing campaign to see happiness in the lives of people has become widely accepted

by millions of people who have their heart captured by Coca-cola

1.4 Target market

● Coca-cola has reaches people all over the world by distributing their products over 200 countries

● Falls an undifferentiated marketing which means there is no segmentation

● The company uses a multi- segment targeting strategy which explains why they have more than one well- defined target market

● However, within their line of products, they have different groups, for instance:

○ Oasis juice is marketed towards 20-30 year- old located in the United Kingdom

○ Powerade is marketed towards “sporty” customers that range from 13

to 27 years old

○ Diet Coke and Coke Zero is a healthier option for those who want to cut calories and life a healthier lifestyle

1.5 Competition

● Coca-cola is leading the world in the beverage business, yet still share the market other companies

● Top three competitors that remain up against Coca-cola are:

○ Pepsico, Inc

○ Nestle S.A

○ Dr Pepper Snapple Group, Inc

● Even Coca-cola keeps a close eye on their competition, they holds the position of being the leader in the market

● Coca-cola dominates in this soft drinks market with 26% of the market share and specifically 43% in the United States market alone

1.6 Brand

 Coca-Cola is a firm that sells many consumer products to customers for their personal enjoyment

 The beverages are classified as a convenience product because the consumers who buy these drinks do not spend much effort or time evaluating the quality before purchasing Coca-cola‟s product mix is made up of breadth

of categories such as soft drinks, juice, diet beverages, sport drinks and water

 Within each product line our depth of drinks, for example for the soft drink

of and include: Coke, Sprite and Fanta Coca-cola goes one step further to make even more variation of each flavor in the line For Coke, there‟s vanilla and cherry For Fanta, there‟s orange and strawberry

2 Marketing Mix in general

Marketing mix is a marketing concept that includes all of the tools available to marketers to develop efficient actions and achieve their sale penetration targets within a target market

Marketing Mix contained 4 elements: Product, Price, Place and Promotion 2.1 Product

The product aspects of marketing deal with the specifications of the actual goods or services, and how it relates to the end-user's needs and wants It involves decisions about the product‟s quality, its style and design and the branding policy

 Product life cycle: all products follow a logical product life cycle and it is

vital for marketers to understand and plan for the various stages

o Introduction: the product will be very new to the market and only a few

people will know about it Marketing strategy in this stage is to create awareness among customers

o Growth: after a while the product will become widely known Marketers,

therefore, focus on building their brand

o Maturity: the market will become saturated Marketing is used to

differentiate producer‟s products

o Decline: at the end of a product‟s life it will become less popular and will

be replaced by other newer products In this stage, advertising budget will

be cut down

 Product variation is a change of the product by adding attributes such as size

and color

 Product differentiation is the process of distinguishing the differences of a

product or offering from others, to make it more attractive to a particular

target market This involves differentiating it from competitors' products as well as one's own product offerings

 Product innovation involves the introduction of a good or service that is new

or substantially improved This includes, but is not limited to, improvements

in functional characteristics, technical abilities, or ease of use

 Product elimination is the removal of products from the product portfolio

once they have reached the decline stage of the life cycle Usually the choice rests between immediate withdrawal and phasing it out slowly

2.2 Price

This refers to the process of setting a price for a product, including discounts

 Cost recovery pricing: setting the price to cover costs

 Price skimming is a pricing strategy in which a marketer sets a relatively

high price for a product or service at first, then lowers the price over time

Price skimming is frequently used when a new product just entered the market, the business may be able to charge high prices as some customers would want to be first to buy the product It commonly occurs in technological markets as firms set a high price during the first stage of the product life cycle The top segments of the market which are willing to pay the highest price are skimmed off first When the product enters maturity the price is then gradually lowered

 Penetration pricing is the pricing technique of setting a relatively low initial

entry price, often lower than the eventual market price, to attract new customers The strategy works on the expectation that customers will switch

to the new brand because of the lower price There is much controversy over whether it is better to raise prices gradually over a period of years (so that consumers do not notice), or employ a single large price increase A common solution to this problem is to set the initial price at the long-term market price, but include an initial discount coupon

2.3 Place

This refers to the channel by which a product or service is sold

 Distribution channel: path or 'pipeline' through which goods and services

flow in one direction (from vendor to the consumer) A distribution channel

can be as short as being direct from the vendor to the consumer or may include several inter-connected intermediaries such as wholesalers, distributors, agents, retailers Each intermediary receives the item at one pricing point and moves it to the next higher pricing point until it reaches the final buyer

 Direct Sales: a retail channel for the distribution of goods and services.

 Indirect sales through partners, is a strategic possibility for growth and

incremental sales for vendors Though invaluable, no direct sales force, vendors can hope to achieve the same coverage and breadth of expertise as

an effective channel partner network For sustainable growth, vendors and distributors are looking beyond their internal resources to extend their sales opportunities with the right partners

2.4 Promotion

Promotion involves disseminating information about a product, product line, brand,

or company Promotion is generally sub-divided into two parts:

● Above the line promotion: promotion in the media (TV, radio, newspapers,

Internet in which the advertiser pays an advertising agency to place the advertisements)

● Below the line promotion: much of this is intended to be subtle enough for

the consumer to be unaware that promotion is taking place (sponsorship, product placement endorsements, sales promotion, etc)

● Promotional mix:

○ Advertising: any paid presentation and promotion of ideas, goods, or

services by an identified sponsor (television, billboard, brochures and catalogs, signs, in-store displays, posters, Web pages, banner ads, emails)

○ Personal Selling: a process of helping and persuading one or more

prospects to purchase a good or service or to act on any idea through the use of an oral presentation (sales presentations, sales meetings, telemarketing)

○ Promotions: incentives designed to stimulate the purchase or sale of a

product, usually in the short term (coupons, contests, product samples, trade shows, exhibitions)

○ Public relations: paid intimate stimulation of supply for a product,

service, or business unit by planting significant news about it or a favorable presentation of it in the media (newspaper and magazine articles/reports, TVs and radio presentations, charitable contributions, speeches, issue advertising, seminars)

3 Coca – Cola’s marketing mix strategy

3.1 Product

As the most recognizable brand in the world, Coca-cola certainly knows how to gain successful global marketing Over a century, Coke remains an industry leader both in product sales and marketing The following are some of the keys to the iconic company‟s strategies:

 Invest for growing brand recognition and customer loyalty.

When mentioning Coca-cola, the first one that appears in customer mind is the original coke It is quite easy to understand because the original Coke beverage brought about the rise of the company It is the most successful drink in the world

Since its launch in 1886, it has shown high demand year after year in different nations despite the general life cycle of a product Logo uses a timeless font which has been written in the Spencerian script, because it would differentiate it from its competitors The company standardized the logo in 1923 and, like the recipe, decided that while packaging could adjust to the times, the core logo was to be untouched It's resulted in a logo that has had more than 100 years to become imprinted in the minds of people around the world

 Design a large product portfolio to satisfy a range of target customers

Coca-cola product strategy in its marketing mix can be studied by understanding its wide product range According to Nielsen's data, Coca-Cola is the number one brand in the beverage, juice, and bottled water market in 2010 Its flagship product

is carbonated drinks, now Coca-Cola has diversified products with many designs, colors and flavors such as Fanta, Maaza, Limca, Sprite, Danisa or Nested Iced Tea

New products have helped Coca-Cola gain new customers and venture into new

markets Coca-Cola aims at satisfying a range of different people It has about 3,300 products sold around the world targeting different ethnic groups, sexes, lifestyles, age groups etc

 Change to adapt to international trend

Over the years, the world has witnessed a growing awareness of the impact of a variety of drinks on public health The Coca-Cola Company‟s response to the public concerns has been prompt For example, some of the products are now caffeine-free The company also has a reduced or no-sugar, no-calorie option for almost all of its products Due to its great popularity around the world, and upcoming trends towards healthier lifestyles Coca-Cola began to make other cola drinks such as coke zero, Coca-cola light, Coca-Cola with lime, diet Coke among others These different beverages with a similar basic taste enabled the company to target a much broader market

 Provide different packaging & sizes to extend the product cycle life

In some markets, the company has different packaging sizes according to consumer demands In most countries, they consist of 300 ml, 600ml, 1.25 liters, 2 liters bottles and in most regions cans with a capacity of 375ml However, in some instances e.g in Mexico there was the introduction of a convenient 2.5 liter bottle due to the high consumption of the soft drink in the country

Coca-Cola's packaging is constantly improving to extend the life cycle of the product to give customers a new feeling, eye-catching, optimistic and more convenient to use During each Tet holiday, Coca-Cola uses the image of "swallow bird" to signal the spring to create a good impression for consumers, making the product more valuable, very suitable for giving and making Tet gifts

Overall, in the product strategy, Coca-Cola expanded its current product portfolio

by increasing the depth of a product line and increasing the number of product lines, positioning the product in accordance with each specific market Especially Asia and Vietnam market and Coca knows how to exploit brands to compete in the

"giant" beverage market

3.2 Price