Coca-Cola Company's Business Strategy | Free Essay Example

Coca-Cola Company’s Business Strategy

Words: 1764
Topic: Business & Economics
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Executive Summary

The fundamental objective of the paper is to identify the primary business strategy employed by the Coca-Cola Company. Moreover, it seems significant to evaluate the strategy in relation to strengths, weaknesses, opportunities, and threats that were identified in accordance with Porter’s Five Forces.

The company uses a modern social network in order to promote a new strategy. Instagram and Facebook followers can see over a hundred photos of different people who share happiness, feelings, and their unique moments with the Coca-Cola brand. It is worth noting that on every photo red Coca-Cola disk, as well as the glass bottle, can be found and it creates an atmosphere of mystery and magic.

The strategies chosen by the company are influenced by changes in the market and environmental issues. The corporation realized that the primary strength is the buyers’ power, and thus, makes an accent on the satisfaction of the public and promotion of the creative campaigns.

Introduction

Coca-Cola is a popular brand that is known and loved across the globe almost in every country. Such popularity can be explained not only with a high-quality product but with outstanding business strategies. The discovery of the modern business strategy of the Coca-Cola Company is the primary objective of the paper. In order to get deeper involved in the issue, it is of paramount importance to make an accent on how the modern business strategy is related to strengths, weaknesses, opportunities, and threats that were identified in accordance with Porter’s Five Forces.

Business Strategy

As a matter of fact, the Coca-Cola Company is one of the most popular and famous brands across the globe. The strategies of the company changed throughout history because the organization understands the importance of changes and being flexible. The tastes of the customers change, and thus, the companies should follow it.

Taken into consideration the above states, the Coca-Cola Company has already announced a new global strategy that will be reflected in the creative campaign, and it sounds unusual to the customers, namely “Taste the Feeling”. The top managers of the enterprise aim to highlight that this beverage is for everyone and can suit any needs of the customer. There is a wide range of product choices, namely the following one, Coca-Cola Light, Diet, Zero, and Life, with caffeine and without, Coca-Cola with different flavors. Although there are different types of beverages, the brand shares the same iconography, missions, and values. The strategy “Taste the Feeling” highlights that people who consume Coca-Cola make their everyday life a little more special. The previous strategy and creative campaign were centered on happiness and was reflected in slogan “Taste the Feeling”. Nowadays, the managers want consumers to experience emotional and functional element of the Coca-Cola brand.

The campaign “Taste the Feeling” promotes drinking Coca-Cola with ice. The choice of the strategy is based on exploring the role of the Coca-Cola in happiness and consequently derived from the previous campaign. The advertisement for TV and the Internet were created for people to see how others share special moments with the Coca-Cola Company. The managers of the company state that “the campaign kicks off with the lead commercial, “Anthem,” which presents a series of moments linked by a Coca-Cola, such as ice-skating with friends, a first date, a first kiss and a first love” (Sulphey, 2010, p. 54). Music is considered to be the integral element of the strategy and promotion of the campaign. The music of Avicii and Conrad Sewell is associated with the “Taste the Feeling” strategy. The Coca-Cola Company devotes a lot of time to leadership because it influences the success of the corporation in a significant way (Scilly, 2015).

The advertisements are made in the form of the story, and it is a reasonable move. First and foremost, it highlights that Coca-Cola unites people and creates a special atmosphere. There will be no story without this company. Describing the design of the global campaign, James Sommerville, made an accent that “the photography features human moments that blur the boundaries between who people are and what they love to do” (Peng, 2009, p. 76). The Coca-Cola plays a primary role in every story, making it brighter, colorful, happier, and adding textures and unforgettable emotions.

Generic Strategies

The marketing strategies that the Coca-Cola Company follows correspond to the Porter’s Five Forces analysis (Porter’s generic strategies, 2007). In order to implement appropriate strategies that will lead the company to success, it is significant to investigate the market, determine a threat of new entrants, a threat of substitutes, the buyers, suppliers bargain power, and rivalry among competitors (Competitive advantage, 2014).

The fundamental strategy that is followed by the Coca-Cola Company is the buyers power (Kapferer, 2012). In the modern economic conditions, it is of paramount importance for the corporation to have a close connection with the consumers. Because of the big amount of rivals, the companies that are trusted and have established good relationships with the purchasers have bigger chances to succeed in the market. As a result, the companies, who have a connection with the buyers and target group are provided with a stable growth index and increase in production. However, in order to follow this strategy, it is essential to keep in mind some key aspects that are involved in the conception.

As a matter of fact, the Coca-Cola Company is a transcontinental corporation; it is sold almost in every country across the globe, excluding Cuba and North Korea. Nevertheless, the list of countries where it is impossible to buy Coca-Cola will be reduced because according to the situation on the world arena, Cuba is likely to have better relationships with the United States, and it will consequently lead to the expansion of the Coca-Cola market (Sulphey, 2010). With the consideration to the potential buyers across the globe, one of the most significant elements is the capability of the manufacturing process to provide the purchasers with enough goods for consumption. Moreover, it is essential to make an analysis of the selling process, determine tendencies, and needs of the market, and direct all the forces to satisfy the current needs of the customers.

Providing the customers with the information regarding the good is a pivotal objective for the accomplishment of the goals set by the company. The information is a vital aspect that influences sales. The Coca-Cola Company is an active participant in the promotion and advertisement segment. In addition, it invests impressive sums of money for sporting events, competitions, and contests. Thus, people always hear about the company, see the product, and promotion. According to the recent research in the sphere of neuromarketing, the Coca-Cola Company is recognizable even without the logo, slogan, or the picture of a bottle made of glass (Groza & Ragland, 2016). The red color is associated with the brand. The New Year commercials have already become a tradition, and Christmas as well as New Year would not be full without traditional Coca-Cola commercial and popular songs that are used to complement the video.

It should be noted that the company creates a unique beverage for the consumers and speaks about it. The person, who buys a product, wants to be sure that the good is unique and will make his or her life a little special (Kim & Mauborgne, 2009). The Coca-Cola Company reflects this principle leaving rivals with no chance to enter the market or compete with the world’s famous brand.

Strategic Choices

The Coca-Cola Company operates in over 200 countries and provides the customers with a wide range of products (David, 2009). The corporation is represented in a non-alcoholic segment that is considered to be highly competitive due to the presence of different brands in the market. The major rival of Coca-Cola is believed to be Pepsi. Diversification is considered to be one of the fundamental strategic choices for the Coca-Cola Company. The society turns attention to the healthy lifestyle, responding to this phenomenon, the enterprise produces Coca-Cola Zero, for example. Turning their attention to the sports drink influences the market share in a positive way.

The disconnect point can be found in the dimension of values and missions of the company. In spite of the fact the corporation is flexible and adjusts to current market needs and it is reflected in their strategy, the company does not react to temporary social moves. It creates new products, however, does not forget its traditions and serves not temporary trends but stability and customs.

With the consideration to the stated above, the conclusion can be drawn that the Coca-Cola Company addresses to the needs of the customers, realizes the significance of the buyers’ power, and acts in accordance with the business strategy (Gulati, 2016). However, it is worth pointing that there is hardly a company in the world that has a perfect management plan and acts in accordance with it on a hundred percent.

Leverage of Strengths and Shoring up Weaknesses

The strength of the company is trusted relationship with the customers. In order to leverage this aspect, the company uses social networks interacting with the target groups (Iansiti & Levien, 2004). Instagram, Facebook, and Twitter followers are provided with an opportunity to follow Coca-Cola and be updated with the current information (Liang, Czaplewski, Klein, & Jiang, 2009). The weakness of the company is the competition with Pepsi and the fact that this corporation has a variety of products. The Coca-Cola Company can create new products, such as new lines of beverages with flavors and snacks.

The company can positively influence the environmental situation in the world by altering strategic choices. The organization realized the significance and value of water not just because it is a primary raw material for the beverage production but also because water is life. Thus, the company developed water strategies that are based on three primary aspects:

  1. Reduction of the water that is used for production;
  2. Partnership with suppliers in order to minimize the water footprint;
  3. Investments in the sustainable technologies (Gulati, 2016).

Moreover, the company cares about the climate changes, and thus, makes the production more efficient and fosters the transition to the cleaner technologies.

Conclusion

The vision and missions of the Coca-Cola Company are relatively stable, although some changes are evident because of the different situation in the market and ecological situation. The corporation cares about the customers and environment. Its strategies correspond to the objective of the company, and successfully influence the position of the brand in the modern market. I would recommend the company to focus on environmental issues and address to the problem of water scarcity.

References

Competitive advantage. (2007). Web.

David, F. (2009). Strategic management: Concepts and cases. Upper Saddle River, NJ: Pearson Education.

Groza, M., & Ragland, C. (2016). Marketing challenges in a turbulent business environment. Bloomington, IN: Springer.

Gulati, R. (2016). Management an integrated approach (2nd ed.). Boston, MA: Cengage Learning.

Iansiti, M. & Levien, R. (2004). Strategy for small fish. Web.

Kapferer, J. (2012). The new strategic brand management: Advanced insights and strategic thinking. London, UK: Kogan Page.

Kim, C. & Mauborgne, R. (2009). What is BOS? Nine key points of Blue Ocean Strategy. Web.

Liang, T., Czaplewski, A., Klein, G., & Jiang, J. (2009). Technical opinion leveraging first-mover advantages in internet-based consumer services. Communications of the ACM Commun. ACM, 52(6), 146-148.

Peng, M. (2009). Global strategic management. New York, NY: Routledge.

Porter’s generic strategies. (2007). Web.

Scilly, M. (2015). Examples of cost leadership and strategy marketing. Web.

Sulphey, M. (2010). Introduction to environment management. Delhi, IN: Phi Learning.