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, Avenue Quezon City
Trinity University of Asia
COLLEGE OF BUSINESS ADMINISTRATION
“Coca Cola Philippines”
In partial fulfillment of the requirements in
Presented to Professor Socorro C. Marqueda
Submitted by: Flores, Cherry May Ibana, Roselyn Ocfemia, Eidrian Narcelles, Valentino Jr. Victoria, Carlota Angela R.
A. Background of the Project
Coca-Cola Company The basic proposition of our business is simple, solid and timeless. When they bring refreshment, value, joy and fun to our stakeholders, then they successfully nurture and protect our brands, particularly Coca-Cola. That is the key to fulfilling our ultimate obligation to provide consistently attractive returns to the owners of our business. Keydates:
The 1880s May 8, 1886, marked the day the new beverage Coca-Cola, created by pharmacist Dr. John Stith Pemberton, was first sold in Atlanta, GA. Pemberton's partner and bookkeeper, Frank Robinson, suggested the name and penned the now famous trademark "Coca-Cola" in his unique script, still used today. In 1887, Coca-Cola was promoted through an innovation developed by The Coca-Cola Company -- coupons providing free samples of the new drink. The 1890s In 1894, in Vicksburg, Mississippi, Joseph Biedenharn was so impressed by the growing demand for Coca-Cola at his soda fountain that he installed bottling machinery in the rear of his store and became the first to put CocaCola® in bottles. On December 4, 1895, Asa Candler proclaimed that Coca-Cola was sold and consumed in every state and territory of the United States. Large-scale bottling was made possible in 1899, when Benjamin Thomas and Joseph Whitehead of Chattanooga, Tennessee, secured from Asa Candler the exclusive rights to bottle and sell Coca-Cola. They joined John Lupton and began to develop what is today the worldwide Coca-Cola bottling system. The 1900s In 1906, the first three countries to bottle Coca-Cola outside the United States were Cuba, Canada and Panama. The 1910s In 1912, a Coca-Cola bottling plant opened in the Philippines, our first in Asia. The first European Coca-Cola bottling plants opened in Paris and Bordeaux, France, in 1919. The contour bottle for Coca-Cola - so distinctive it could be recognized in the dark - was introduced in 1916 to distinguish Coca-Cola from competitors. The 1920s The six-pack carrier for bottles of Coca-Cola was introduced in 1923. Though cartons for bottles are commonplace today, in 1923 this was an innovation developed by the Coca-Cola system to encourage people to take bottles of Coca-Cola home and drink it more often.
The July 1928 Olympic Games in Amsterdam marked the debut of The CocaCola Company's Olympic involvement, when a freighter arrived with the U.S. Olympic Team and 1,000 cases of Coca-Cola. The Company is the longestcontinuous corporate supporter of the Olympic Movement and in 2005 extended its sponsorship of the Olympic Games through 2020. In 1929, the Glascock Brothers Manufacturing Company of Muncie, Indiana, introduced the first standard cooler sanctioned by The Coca-Cola Company. The open-top machines were self-service units that required the consumer to pay a store clerk for purchases. The 1930s In December 1931, artist Haddon Sundblom's Santa Claus first appeared in ads for Coca-Cola. This image of Santa - shown as a plump, jolly, friendly man - helped shape the modern-day image of St. Nick. Sundblom continued creating this sustaining image of Santa Claus for the next three decades. The 1933 Century of Progress Exposition in Chicago marked the introduction of automatic fountain dispensers, in which syrup and carbonated water were mixed as the drink was poured. The 1950s 1955 saw the debut of the King Size (10- and 12-ounce) and Family Size (26-ounce) contour bottles in the U.S., followed by Coca-Cola in 12-ounce cans in 1960. Until this point, Coca-Cola® had been available only at the soda fountain and in 6 ½-ounce bottles. The 1960s The Fanta line of flavors was introduced in the United States in 1960, marking the widespread introduction of the brand. Sprite was introduced in U.S. stores in 1961. These launches marked the first new brands in The CocaCola Company's history. Until these introductions, Coca-Cola was the Company's only brand. In 1960, The Coca-Cola Company acquired Minute Maid with its Minute Maid, Snow Crop® and Hi-C brands. The Coca-Cola Company's first diet soft drink, TaB , was introduced in the U.S. in 1963 and spurred the early growth of the low-calorie soft-drink segment. The 1980s In 1982, soft-drink history was made with the introduction of Diet Coke, the first extension of the trademarks Coca-Cola and Coke, and the most successful new soft drink since Coca-Cola itself. Within two years, Diet Coke had become the top low-calorie soft drink in the world. On July 12, 1985, Coca-Cola became the first soft drink to be consumed in space when astronauts tested the "Coca-Cola Space Can" aboard Space Shuttle Challenger. Working with NASA, The Coca-Cola Company invested more than $250,000 in the initial development of the space can technology. Coca-Cola was named the most powerful brand name in the world, according to the Landor Imagepower Survey in 1988. The 2000s
The Coca-Cola Company launched an innovative new aluminum contour bottle in 2005. April 2006Coca-Cola launches innovative global multimedia communications campaign for its trademark brand Coca-Cola under the slogan "The Coke® Side of Life.
A. Contextual Environment of the Company
History of Coca – Cola Company in the Philippines Coca-Cola’s history in the Philippines is intertwined with the country’s own. Throughout the years, they have become so much a part of everyday Philippine life through a shared heritage. From its beginnings in 1927 until now, Coca-Cola remains one of the most loved beverages by Filipinos. The establishment of Coca-Cola Bottlers Philippines Inc. (CCBPI) in June 1, 1981, transformed Coca-Cola into the dominant player in the industry as one of the world’s largest Coca-Cola bottlers. Today, CCBPI is the 8th largest corporation in the Philippines in revenues.
From 1981’s 75 million unit cases sold by Coca-Cola, the year 2000 saw a massive growth in sales to 386.3 million unit cases. From the beginnings in 1927 until today, Coca-Cola in the Philippines is now the 8th largest market in the world. Coca-Cola is the leader in the Philippine soft drink industry. Over 70 million consumers from Luzon, Visayas and Mindanao enjoy the wide portfolio of beverages that Coca-Cola offers. The marketing and distribution networks cover 16 commercial territories and over 243 sales offices. Through this, they are able to reach 10 million Filipino homes to bring refreshment and fun. They are able to share in every aspect of Filipinos lives. Through birthdays, celebrations and holidays, Coca-Cola is always there to make every memory taste better. There are 19 Coca-Cola bottling plants in the country. And in all of these they ensure that they take measures to protect and preserve the environment. They employ state-of-the-art waste water
treatment facilities and embark on education drives to inform communities about the importance of protecting and rehabilitating our rivers. They also work towards preventing air and land pollution through special projects and initiatives. Coca-Cola in the Philippines employs over 9,000 people from CCBPI and The Coca-Cola Export Corporation (TCCEC), the Philippine arm of Coca-Cola in Atlanta. They value the contributions that each Coca-Cola member gives. They provide training and development courses to help people become the best that they can be in their jobs through the Center for Learning and Development program. In July of 2001, CCBPI returned to the San Miguel Corporation after being a part of Coca-Cola Amatil Ltd. for several years. The merge brought about the acquisition of The Cosmos Bottling Corporation. This introduced many new drink variants into the Coca-Cola portfolio of beverages. To date, Coca-Cola in the Philippines offers the widest selection of beverages to fulfill every hydration and lifestyle requirement. They offer many beverages for different needs like soft drinks, water, juices, teas, sports and energy drinks. Everyday they strive to give their consumers what they need as a total beverage company. Truly, the story of Coca-Cola in the Philippines is that of the country’s itself. They have grown together with the events that have shaped the country. Looking forward, they will continue to be at one with the Filipino consumers and to be a part of their lives.
B. Vision and Mission
Vision: Our vision serves as the framework for our Roadmap and guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable, quality growth. • • • People: Be a great place to work where people are inspired to be the best they can be. Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy people’s desires and needs. Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value.
• • •
Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities. Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities. Productivity: Be a highly effective, lean and fast-moving organization.
Mission: Our Roadmap starts with our mission, which is enduring. It declares our purpose as a company and serves as the standard against which we weigh our actions and decisions. • • • To refresh the world… To inspire moments of optimism and happiness… To create value and make a difference.
Type Public (NYSE: KO) Founded 1892 (1892) Headquarters Atlanta, Georgia, United States Area served Worldwide Key people Muhtar Kent (Chairman and CEO) Industry Beverage Products: Coca-Cola Carbonated Soft Drinks Water Other Non-alcoholic beverages Revenue ▲ US$ 31.944 billion (2008) Operating income ▲ US$ 8.446 billion (2008) Net income ▲ US$ 5.807 billion (2008) Total assets ▲ US$ 40.51 billion (2008) Total equity ▲ US$ 20.472 billion (2008) Employees 92,400 (October 2009)
Part II STRATEGIC MARKETING
A. Market Segments and Customer Value
1. Fashionable Brand Conscious Customers – these are the people who wanted to try
the latest products that are available in the market. 2. Average Consumers - the usual people who buys coca cola products out of their need of refreshment (ex. People who buys coke out of thirst, people who buys coke for occasions.) 3. Young generation – the youngsters who are adventurous who needs an instant stimulant for their daily activities that is affordable and easily bought in the market. 4. Coke Addicts – they are the loyal consumers of coca cola products, they have supported the products for years and continues to maintain their patronage. *Major segments are basically those people who take this drink daily and those areas where the demands is higher then the other areas. There are so many people who take this drink daily and those people who take weekly and those who take less often are always there as well. So, their basic segments are those people who take this drink regularly.
* Coca cola seek to better understand the impact of the Coca-Cola business along the
entire value cycle and partner with the customers to address areas of concern and add value beyond their beverage products. The customers include large local chains of retailers and restaurants and small independent businesses. They work with them equally to create mutual benefit. Together with the bottling partners, they serve their customers through account management teams, providing services and support tailored to their needs. The management is continually looking for ways to reduce costs, improve sales and profits, and deliver better-quality, more diverse products to consumers. They work to create additional value for their customers by anticipating
their demands and interests and to proactively deliver viable solutions for the businesses.
A. Strategic Market Segmentation
The major segmentation variables – geographic, demographic, psychographic, and behavioral segmentation:
GEOGRAPHIC SEGMENTATION Geographic segmentation calls for dividing the market into different geographical units such as regions, cities, or neighborhood. The Coca Cola Company can operate in one or a few geographic areas, or operate in all but they pay attention to local variations such as the establishment of Coca Cola plantations for every chosen region in the Philippines.
DEMOGRAPHIC SEGMENTATION In demographic segmentation , the market is divided into groups on the basis of variables such as age , family life cycle , gender , income , occupation , education , religion , race , generation , nationality , and social class. Demographic variables are the most popular bases of Coca Cola Company for distinguishing their customer groups. The reason is that consumer wants, preferences, and usage rates are often associated with demographic variables. Another is that demographic variables are easier for Coca Cola to measure because they can evaluate or conduct surveys for the demographic segmentation.
*Age and Life-Cycle Stage Coca Cola Consumer wants and abilities change with age. Age and life cycle can be tricky variables because there are different needs and wants as accord to the age of a person, the main sector in which Coca Cola Company targets is the youth because there is a much need of refreshment and energizers to cope up with their daily activities.
Men and women tend to have different attitudinal and behavioral orientations, based partly on genetic makeup and partly on socialization practices. Gender is also an issue needed to be given prior by coca cola since the drink is fattening Coca cola launched a drink which is sugar free it is for the men or women who are figure conscious.
Income segmentation is long- standing practice in coca cola products they offers the public with products which are equal to the capability of a consumer to purchase the product.
*Social Class Social class has a strong influence on preference in food and drinks. Coca cola design products for specific social classes.
In psychographic segmentation, Coca Cola buyers are divided into different groups on the basis of lifestyle or personality or values. People within the same demographic group can exhibit very different psychographic profiles, for that reason Coca Cola Company designed and made product which are suitable for their personality.
*Lifestyle People exhibit many more lifestyles than are suggested. People differ in attitudes, interest, activities, and these affect the goods and services they consume. Coca Cola Company presented products which can comply with the needs and activities of the consumers.
*Personality Coca Cola Company is using personality variables to segment markets. They endow coca cola products with a “brand personality” that corresponds to a target consumer personality. The company utilizes product features and image making to transmit the product’s personality.
*Values Some markers segment by core values. Core values go much deeper than behavior or attitude, and determine, at a basic level, people’s choices and desires over the long term. The values are being highlighted through Coca Cola commercials giving emphasis on family orientations.
BEHAVIORAL SEGMENTATION In behavioral segmentation, Coca Cola buyers are divided into groups on the basis of their knowledge of, attitude toward, use of, or response to a product. Many marketers believe that behavioral variables-occasions, benefits, user status, usage rate, loyalty status, buyerreadiness stage, and attitude—are the best starting points for the construction of market segments.
*Occasions Coca Cola consumers can be distinguished according to the occasions when they develop a need, purchase a product, or use a product. Occasions segmentation can help firms expand product usage.
Part III Market Segments and Customer Value
Market and Competitive Space
Company The Coca-Cola Company Pepsico, Inc. Dr Pepper Snapple Group, Inc. Groupe Danone World Water Division Nestlé Waters ITO EN, LTD. Red Bull GmbH Cott Corporation Britvic Plc Ocean Spray Cranberries, Inc. Diageo plc
Anheuser-Busch In Bev Suntory International Corp. Kraft Foods Inc. Pernod Ricard SA Molson Coors Brewing Company GRUPO MODELO, S. A. B. DE C. V. Constellation Brands Inc.
Symbol Price Change Market Cap P/E KO 57.49 0.38% 133.21B 21.28 PEP 63.85 1.74% 99.63B 19.20 DPS 26.80 0.34% 6.81B N/A Private - View Profile Private - View Profile Private - View Profile Private - View Profile COT 8.14 1.37% 646.28M 10.65 Private - View Profile Private - View Profile NSRGY.PK 49.27 -0.75% N/A N/A DEO 69.37 1.15% 42.94B 16.10 HINKY.PK 25.28 2.18% N/A N/A SBMRY.PK 30.14 2.00% N/A N/A BUD 52.64 0.00% 84.40B 27.57 Private - View Profile KFT 26.57 0.57% 39.21B 15.68 Private - View Profile TAP 45.72 1.02% 8.46B 14.11 Private - View Profile STZ 16.74 1.27% 3.71B N/A
B. Strategic Market Segmentation
Coca-Cola’s market is distinguished according to geographic location and age. Geographic location pertains to determination of whether the consumer comes from the rural or urban areas. Although, there are more potential consumers in the rural areas, most of
Coca-Cola’s customer base is located in the urban areas. This manner of segmentation is supported by the economic diversity of Philippines so that it is imperative that it should not be considered as a single market. Philippines’ market diversity stems from the disparity in income between rural and urban areas since the per capita disposable income in urban areas is at a level of three times more than in rural areas.
Apart from this, there is also a disparity in income among urban areas based on the level of economic development and the concurrent standard of living. The imbalance in economic development in different geographical regions of Philippines affects the
purchasing power of consumers in the different regions. In considering the top four largest cities in Philippines, these accounted for only 4 percent of the population but responsible for 15 percent of retail sales while the remaining small cities and provinces represent 80 percent of the population accounting for a little more than 50 percent of retail sales. (2003) Age as the other criteria for market segmentation of Coca-Cola consumers refers to the segmentation of the company’s consumers according to consumers below 45 years old and 45 years old and over. The age distinction is based on the young generation during the time of the reintroduction of Coca-Cola in Philippines in the 1927s. It was this generation, aged 45 and below, that comprised the initial customer base of Coca Cola and integrated consumption of company products into their food and beverage purchases. The generations before them do not have a similar attachment to Coca-Cola products.
Coca-cola has a strong brand equity (2005) attached to its products. The value of its brand comes from the reputation of the company of developing a good tasting soda beverage that families and friends can share. Coke is all about tradition and stability. This was observed by
the consistency of the company’s approach, message and product development. The strengths of coke come from its ability to be consistent, a product that is always there. When coke introduced New Coke in 1985, a product with a sweeter taste, the public reaction to the change was devastating to the company.
The change represented a deviation from the values of stability and consistency attached to the brand equity of the company. Coke relies mainly on its brand equity to sell its products. Although, coke also got involved in celebrity endorsements, it withdrew from this race and continued with its equity-based campaigns. Thus, Coca-Cola has positioned itself in the international market and in Philippines as a traditional and consistent company that will always be there to provide its products to the market.
Part IV Designing Market-Driven Strategies A. Market Targeting
The marketing mix of Coca-Cola comprises the factors that the company controls in order to provide customer satisfaction in the targeted market segments. Through the strategic
blending of these factors, Coca-Cola ensures that it is able to generate a positive response from its targeted market segments.
THE VARIETY OF PRODUCTS FOR THE EVERY TARGET MARKET: “CARBONATED SOFTDRINKS”
Coca-Cola. The number 1 brand in the Philippines. The favorite soft drink brand of most Filipinos. By far the most popular and biggest selling soft drink in the Philippines, only CocaCola has that unique delicious taste, happy fizz and burn and bite that truly refreshes. Everyday, Filipinos from all over the country reach for a Coke and when they do, they are reaching for more than a beverage. Adjudged the nation’s softdrink (Softdrink ng Bayan), it is one of those things that everyone shares….it’s for everyone…bringing people together – celebrations are never complete without Coke, meals with family are made special with Coke.
Always embodying the brighter side of life, Coca-Cola inspires happiness, optimism and connections everyday, everywhere, at any time.
Coca-Cola Light. The number 1 light/diet soft drink brand in the Philippines. It has all the Great Taste with none of the calories, none of the sugar. You can have as much as you want without any worries.
SPRITE is the leading lemon-lime soft drink in the Philippines and the 2nd largest trademark of The Coca-Cola Company in the world. Sprite is enjoyed by consumers for its clean, crisp taste that deeply refreshes and quenches your thirst. It’s the only soft drink brand that has an honest, straight-forward attitude encouraging you to be true to yourself.
ROYAL TRU-ORANGE is the dominant orange soft drink brand in the Philippines. The brand’s teen consumers have come to equate true orange refreshment only with Royal. Royal’s highspirited fun character feeds today’s teens’ craving for excitement in their lives and enables them with its bubbly, fizzy bold orange flavor to make the everyday realities of life more fun.
Pop Cola is the Filipinos' favorite low-cost soft drink, ranked no.2 and famous for its Pinoy Cola taste and affordable price. Pop Cola is known for its humorous and entertaining ad campaigns that embrace well known Filipino cultural truths. Like the role portrayed by Robin Padilla and his loyalty to his “suki” (the person he usually buys from), and the balikbayan OFWs.
How sweet life can be with Cheers Orange. Cheers targets bagets (pre-teens) who are in a hurry to become an adult but still have a strong craving for sweets like a kid.
Time to sparkle with Sparkle Lemon! Grab the refreshing sparkling drink that offers that sweet lemony goodness you will surely love. You don’t have to worry about the calories because it has 25% less sugar than regular softdrinks. Today, Sparkle is distributed nationally geared towards people who want that distinct, refreshing, sweet lemon enjoyment.
Ibang klase! (It’s unique!). This is Sarsi’s current tagline because Sarsi is currently number 1 in the rootbeer category in the Philippines. It has been around since 1918 offering a unique “sarsaparilla” taste that is caffeine free and 25% less sugar than any other soft drink. Sarsi’s
main drinkers are confident, independent, and proud to be unique. It is currently available in Metro Manila and Luzon.
Jazz up your taste, Jazz up the South. Jaz Cola is the cola proudly made and available only in the Visayas (southern Philippines). Young Jaz drinkers have come to know Jaz Cola as the brand that understands the Visayan market and is made especially for the Visayan teen.
Eight O’Clock powdered juice has long been a favorite instant juice drink brand for Filipino families. It captures the juiciness of delicious Florida Oranges in its Fresh Formula 882, and brings this freshness to each and every glass enjoyed by kids, moms, and families, every day. Beyond offering a delicious instant juice drink, Eight O’Clock provides nutrition in every glass. Every glass of Eight O’Clock contains 100% of the recommended daily allowance of Vitamin C, which fortifies the immune system and helps in maintaining healthy blood vessels. Eight
O’Clock, the fresh, juicy, orange-flavored drink, offers a beautiful day to Filipino kids and families, everyday.
The natural bounty of the Earth and the serenity of the Sky - these restful comforting qualities now come together in a new iced tea drink: Earth and Sky Lemon Iced Tea. Made from Earth's natural bounty: natural powder and lemon flavor. Enriched with 100% RDA Vitamin C
Green tea has been found to be good for the heart, helps prevent cancer, helps lower blod cholesterol, good for the teeth and most of all, is a rich source of anti-oxidants. So what? Well, anti-oxidants protect the body's cells from damage and fight diseases - that's what. And antioxidant and other health benefits of green tea, are now in Earth & Sky Lemon Green Iced Tea. Get in the green of health and try Earth & Sky Lemon Green Iced Tea today.
Nestea Ice is the much talked about, new “It Drink” for iced teas. The mixture of ice and mint brings a unique extra cooling sensation - so cool, it makes you shiver! Coupled with great taste, Nestea Ice is a totally exciting and thirst- quenching iced tea drink. Nestea comes in three variants: Nestea Ice Lemon Green Tea, Nestea Ice Lemon Iced Tea and Nestea Lemon Iced Tea all in a hip, handy rocket bottle design. Nestea Ice is now available in supermarkets, convenience stores and groceries nationwide. So you can enjoy Nestea Ice anytime, everywhere.
Not all bottled waters are created equal.Without a doubt, pure distilled water is safe for you and your family. Distilled water goes through evaporation & condensation in an enclosed environment to ensure that the water comes back in its original form – H2O. This means no dissolved solids, chemical impurities & no life threatening diseases – only pure & safe distilled water. When it comes to distilled water, Wilkins is the leader. It has no chlorine & other organic compounds that produce cancer-causing substances. In fact, it is processed according to the Code of Hygienic Practices and has been tested to comply with the strictest specifications and standards for packaged water of The Coca-Cola Company, Bureau of Food and Drug (BFAD), Philippine National Standards for Drinking Water (PNSDW) and the Asian Bottled Water
Association (ABWA).Truly, Wilkins is a brand that you can trust and is the ideal water for you and your family. Wilkins, pure and safe, without a doubt. Available in 330 & 500mL singleserve packs, 1L, 1.5L, 2L, 4 & 6L multi-serve packs and the 5-gallon container.
For young people like you who lead active lifestyles driven by their desire to live life to the fullest, we have Viva! Mineral Water. Viva! will suit your thirst to get more out of life and suit your active lifestyle because it contains minerals that help you be good to your heart, skin and inner self, giving you confidence to enjoy all that life has to offer. Drink Viva! Be good to your body and enjoy life to the fullest.
Garantisadong Malinis. Garantisadong abot-kaya ang presyo. Mula sa Coca-Cola Company, ito ang bottled drinking water na garantisadong safe to drink! Ipinakikilala… SAFETY FIRST DRINKING WATER. Ang drinking water na plant-produced at machine-processed. Gawa ayon sa standards ng Coca-Cola Company. Abot-kaya pa ang presyo. Ano pa ang pipiliin mo? Dito ka na sa Safety First.
The pricing strategy of Coca-Cola is based on the pricing dynamics relative to its competitors as well as the value of its products. In Philippines, as is true in the international market, the fiercest competitor of Coca-Cola is Pepsi so that pricing is in a way influenced by the interplay of these competitors in a given market. However, Coca-Cola holds the advantage in pricing because it had a head start of several years giving the company a stable market share relative to Pepsi, which suffered several bankruptcies. The product price of Coca-Cola became the industry benchmark. The strategy of Pepsi then was to sell its products at half the price of Coca-Cola. The company was able to gain a share in the market. (2003). This pricing dynamics between Coca-Cola and Pepsi continue today. In supermarkets, the price of coke is still higher by 15 to 20 cents when compared to Pepsi.
The higher price given by Coca-Cola to its products is supported by the value of the brand equity of its different soft drink products. Coca-cola was able to sell at a higher price than its competitors because of its stable share market share due to its marketing communications message linked to brand equity of product stability. This makes Coca-Cola a true leader in the industry due to its ability to determine the industry pricing benchmark. Despite its slightly higher pricing, it is still able to maintain a market share by establishing a high value for its products through associations with consistency and dependability.
Coca-Cola applies consistency and dependability even in its promotional activities. The company actually makes use of pattern advertising ( 2003). The company develops advertisements containing its determined marketing communications message. The manner of advertising adheres to various specific audiences. However, despite the consistency of its advertising framework for its different markets around the world, Coca-Cola also implements local adjustments. The adjustments cover the 1) translation of words and lyrics in the local dialect of particular markets and delivered in a manner appropriate and acceptable to the local culture, 2) basic adjustments to the advertising format such as the use of locally significant words, phrases, messages and the arrangement of these elements to deliver a cohesive promotional campaign aligned with the basic marketing communications message of the company; 3) audio-visual adjustments made to the advertising format such as colour scheme, character selection, video stream and other audio-visual aspects of the campaign. Apart from pattern advertising, Coca-Cola also adheres to product differentiation (2003) by withdrawing from the explicit cola war with Pepsi. The cola war persisted until the late 1900s with taste-tests and celebrity endorsements of competing personalities. In succeeding years Coca-Cola reverted to its marketing strategy of appealing to the stability and consistency found in the value accorded to family and friendship differentiating the company, product and brand from its competitors.
All the soda brands are marketed in the common channels of distribution except in the exclusive retail venues that companies bid to have. In supermarkets, these brands are sold side by side in the display shelf not giving a single brand any edge relative to the buyer. The rivalry over the channels of distribution was elevated to obtaining exclusive selling contracts in restaurants, places for vending machines, recreation areas, and popular events. In Philippines, the focus of Coca-Cola is in direct-to-retail distribution through the establishment of a minimum of one sales centre in cities with a total population of 1 million. The sales centres that also serve as warehouses are completely owned and operated. Other bottling firms with which the company has entered into joint venture agreements for logistics support, delivery trucks numbering around twenty in large cities are on standby in the sales centres to cater to retail orders. Apart from its own distribution centres, Coca-Cola also partners with large wholesalers with valuable experience in the area of retailing and independent wholesalers able to reach out to local communities. Apart from this, Coca-Cola also builds strong partnerships with government units by sponsoring welfare programs.
B. Strategic Relationships
The Coca-Cola Foundation Philippines, Inc. - est. 1986 Location: Manila, Philippines
Overview: Coca-Cola Foundation Philippines was established in November 1986 in celebration of the 60th Anniversary of the bottling of Coca-Cola in the country. The Foundation's mission is: "To refresh the communities we touch through programs that provide Filipino youth the opportunity to become self-reliant, creative and productive citizens with the drive to excel." Since it began operations in 1987, Coca-Cola Foundation has helped to provide thousands of Filipinos with better opportunities in livelihood and education, emergency assistance during disasters, an improved environment and a healthier ecosystem.
C. Customer Relationship Management
The coca-cola company had shown devotion for their customers and developed a firm relationship to them such examples are sponsorship programs held by the company. Examples are the following:
Philippines Division Sponsors Convention to Improve Nutrition of School Children: The Coca-Cola Export Corporation (TCCEC) Philippines Division recently sponsored the 59th Annual Convention of the Philippine Association of Nutrition (PAN). The convention, themed "Improved Nutrition of School Children: An investment for Development," emphasized the importance of participation by foundations, government agencies and especially the private sector and individuals in alleviating the problems of nutrition. TCCEC's efforts to improve the health and wellness of school children were highlighted during the convention. Among those discussed were
our Company's partnership with the Food and Nutrition Research Institute (FNRI) and the Department of Education through the Kineti-Kids Program.
Supporting Information and Communication Technologies in Schools In September, The Coca-Cola Export Corporation (TCCEC) - Philippines Division sponsored the Second National ICTs in Basic Education Congress. The event brought together more than 1,000 representatives from the education, technology, private and government sectors, to learn about the planning and management of information and communication technologies (ICTs) resources. Our Philippines Division’s
ed.Venture program was featured at the congress to highlight our role in helping to integrate ICTs into the country's public high school system. Launched in 2004 in partnership with the Foundation for Information Technology Education and Development, Inc. (FIT-ED), ed.Venture was implemented in 15 pilot schools nationwide to provide educational modules and facilities to integrate the use of ICTs in all subjects of the curriculum. The goal of this year’s congress was to emphasize the importance of organizing the support system for teachers in schools implementing ICT integration through the provision of administrative and technical support and leadership. Integrating ICTs has to be accompanied by support from the school's administration so that teachers are able to continually implement and innovate with new technologies in the classroom.
Part V Market-Driven Program Development
Strategic Brand Management
Coca-Cola (also known as Coke, a name that was trademarked by The Coca-Cola Company after it was discovered many people called it by that particular name) is a cola (a type of carbonated soft drink) sold in stores, restaurants and vending machines in more than 452countries. It is produced by The Coca-Cola Company (NYSE: KO), which is often referred to as simply Coca-Cola or Coke. Coke is one of the world’s most recognizable and widely sold commercial brands.
Brand Spotlight: Coca-Cola From the Three A’s to the Three P’s Coca-Cola used to focus its strategy on the three A’s: availability, acceptability, and affordability. While these provided for
tremendous growth, they also led to lowered entry barriers. Today, Coca-Cola’s mantra is the three P’s: preference, pervasive penetration, and price-related value.
The Power of Brand Accessibility If you were another soft drink company, you might define your competitive frame of reference as the cola market or the soft drink market or even the beverage market. But Coke thinks of its business and its market share in terms of “share of human liquid consumption.” This makes water a competitor. In fact, a Coke executive has said that he won’t be satisfied until “there is a Coca-Cola faucet in every home.” Coca-Cola’s mantra is “within an arm’s reach of desire.”Coca-Cola is Serious about Brand Building each month, Coca-Cola tests 20 brand attributes with 4,000 consumers to measure movement. The company also compensates (bonus and other compensation components) a large portion of its senior managers based on brand preference.
B. Chain Strategy
One of the world's largest Coca-Cola bottlers, Coca-Cola Bottlers Philippines operates 19 production facilities nationwide. The company engaged Accenture to assess the feasibility of using a shared services strategy to drive high-performance finance processes. Coca-Cola Bottlers Philippines, Inc. (CCBPI) is the sole Coca-Cola licensee in the Philippines. One of the world's largest Coca-Cola bottlers, the company operates 19 production facilities nationwide. CCBPI owns the Santa Rosa I and II plants which, jointly, form one of the world's largest soft drink manufacturing complexes.
With a population of 76 million, the Philippines has one of the world's highest soft drink consumption levels per capita. While CCBPI currently commands a 70 percent share of this market, two competitors—Pepsi and a local bottler, Cosmos—are making small gains. Products of The Coca-Cola Co. were first sold in the Philippines in 1912. The San Miguel Co. began local production in 1927. In 1981, San Miguel Corp. and the Coca-Cola Co. formed the joint venture Coca-Cola Bottlers Philippines Inc. In 1997, Coca-Cola Amatil, acquired 100 percent ownership of CCBPI under a stock swap agreement.
C. Pricing Strategy and Management
As the top player in a market (at least the soft drinks part of their business) dominated by only two companies (Coke and Pepsi), there is not a lot of pricing strategy at the consumer level. Because of strong consumer preference for one or the other, a few coins difference is not likely to cause switching and will only decrease their profits. We believe the competition with pricing
occurs through trade deals-they work with big retail chains to obtain more space, cooler presence, etc. in exchange for lower prices. Retailers are happy to oblige, as soft drinks are in the top two or three products most frequently purchased in grocery and convenience stores. They move quickly and people make multiple purchases per week, so it brings people into the store, where they buy other stuff.
A significant area is in the "on-premise" area-restaurants, movie theatres, amusement parks and the millions of other places that sell large amounts of soda-these are exclusive arragements99.9% of the time a business sells either coke or their beverages. We would think that this is probably the biggest area of competition for these companies. Getting and keeping these contracts key to cokes business success for a number of reasons:
1. huge sales volumes 2. long term exclusive contracts offer stability 3. name recognition/builds customers
4. .highly profitable versus retail sales because: 5. less transportation costs to deliver syrup (fountain drinks) versus to deliver heavy, bulky and frequent shipments of cans/bottles) much lower packaging costs-again, syrup versus bottles, cans
A. Promotion, Advertising and Sales Promotion Strategies
ADVERTISEMENT Coca cola company use different mediums • • Print media Pos material Tv commercial Billboards and holdings
Print Media They often use print media for advertisement. They have a separate department for print media. POS Material Pos material mean point of sale material this includes: posters and stickers display in the stores and in different areas. TV Commercials As everybody know that TV is a most common entertaining medium so TV commercials is one of the most attractive way of doing advertisement. So Coca Cola Company does regular TV commercials on different channels. Billboards and Holdings Coca cola is very much conscious about their billboards and holdings. They have so many sites in different locations for their billboards. Getting shelves They gets or purchase shelves in big departmental stores and display their products in that shelves in that style which show their product more clear and more attractive for the consumers. Eye Catching Position Salesman of the coca cola company positions their freezers and their products in eye-catching positions. Normally they keep their freezers near the entrance of the stores.
Sale Promotion Company also do sponsorships with different college and school’s cafes and sponsors their sports events and other extra curriculum activities for getting market share.
UTC Scheme UTC mean under the crown scheme, coca cola often do this type of scheme and they offer very handy prizes in it. Like once they offer bicycles, caps, tv sets, cash prizes etc. This scheme is very much popular among children. Sponsorship Philippines Division Sponsors Convention To Improve Nutrition Of School Children September
15, 2006 edition The Coca-Cola Export Corporation (TCCEC) Philippines Division recently
sponsored the 59th Annual Convention of the Philippine Association of Nutrition (PAN). The convention, themed "Improved Nutrition of School Children: An investment for Development," emphasized the importance of participation by foundations, government agencies and especially the private sector and individuals in alleviating the problems of nutrition. TCCEC's efforts to improve the health and wellness of school children were highlighted during the convention. Among those discussed were our Company's partnership with the Food and Nutrition Research Institute (FNRI) and the Department of Education through the Kineti-Kids Program. Supporting Information and Communication Technologies In Schools October 20, 2006 edition in September, The Coca-Cola Export Corporation (TCCEC) Philippines Division sponsored the Second National ICTs in Basic Education Congress. The event brought together more than 1,000 representatives from the education, technology, private and government sectors, to learn about the planning and management of information and communication technologies (ICTs) resources. Our Philippines Division’s ed. Venture program was featured at the congress to highlight our role in helping to integrate ICTs into the country's public high school system. Launched in 2004 in partnership with the Foundation for Information
Technology Education and Development, Inc. (FIT-ED), ed.Venture was implemented in 15 pilot schools nationwide to provide educational modules and facilities to integrate the use of ICTs in all subjects of the curriculum. The goal of this year’s congress was to emphasize the importance of organizing the support system for teachers in schools implementing ICT integration through the provision of administrative and technical support and leadership. Integrating ICTs has to be accompanied by support from the school's administration so that teachers are able to continually implement and innovate with new technologies in the classroom
A. Sales Force and Direct Marketing Strategies
Direct selling gain much popularity today than ever before. The growing popularity of direct selling manifests the Filipino spirit of enterprise and self-reliance and the willingness as well to succeed and participate in the development of the country. Direct Selling necessitates the employment of a considerable number of people to effectively carry out the marketing and production activities of many direct selling companies. Consequently, not only will additional sales personnel be hired but factory workers as well. As a result, the direct selling sector has the potential to bring additional revenues to the government. Coca-Cola Bottlers Philippines is looking for Distributors (Market Execution Partners) who will work with them to take what is already an incredibly successful franchise to the next level. Coca-Cola Bottlers Philippines is the only authorized bottler of The CocaCola Company in the Philippines. The company manufactures and distributes some of the best-selling beverage brands in the country. These brands include Coca-Cola, Coke Zero, Coke Light, Sprite, Royal, Pop Cola, Sarsi, Sparkle, Cheers, Minute Maid, Eight O’
Clock, Nestea Fun Chum, Nestea Blast, Viva, Wilkins, Safety First, Nestea RTD, and Earth & Sky.
Part VI Implementing and Managing Market-Driven Strategies
Designing Market-Driven Organizations
➢ Division of labor • Subdivision of work into separate jobs assigned to different people Potentially increases work efficiency Necessary as company grows and work becomes more complex ➢ Forms of work coordination Informal communication sharing information High media-richness Important in teams Formal hierarchy Direct supervision Common in larger firms
Problems - costly, slow, less popular with young staff standardization Formal instructions Clear goals/outputs Training/skills
A. Marketing Strategy Implementation and Control
“Beverage Manufacturing Plant Layout”
Financial Forecasts Financial forecasts are predictions of future events relating strictly to expected costs and revenue costs for future years. There are five major marketing expenditures, which include research costs, product development costs, product costs, promotion costs and distribution costs. Sales force composite is the most logical method in forecasting revenue. This involves estimates from individual salespeople to sell to work out a total for the whole business. Once these costs and revenues are forecasted, management can then decide which combination of marketing mix strategies will deliver the most sales revenue at the lowest cost. Implementing Implementation is the process of turning plans into actions, and involves all the activities that put the marketing plan to work. Successful implementation depends on how well the business blends its people, organizational structure and company culture into a cohesive program that supports the marketing plan. For its further success, Coca Cola must impose several key changes. Production needs to be on time and meet the quota demanded from wholesalers. It must also be efficient so as not to build inventory stocks and inventory prices. The marketing needs to be motivated and knowledgeable about the product. The forms of promotion such as advertising must be attracting and enticing to the target market to get the greatest amount of exposure possible for the product. This will ensure the success of the product in the stores. Distribution of
the product must be efficient. This problem has already been taken care of with convenient transport routes to commercial areas and transport already being arranged. Monitoring and Controlling Monitoring and controlling allows the business to check for variance in the budget and actual. This is important because it allows Coca Cola to take the necessary actions to meet the marketing objectives. There are three tools Coca Cola should use to monitor the marketing plan. They are the following: 1. Sales Analysis The sales analysis breaks down total business sales by market segments to identify strengths and weaknesses in the different areas of sales. Sellers of Coca Cola products vary from major retail supermarkets to small corner stores. This gives its products maximum exposure to customers at their convenience. 2. Market Share Analysis Market share analysis compares Coca Cola s business sales performance with that of its competitors. Coca Cola looks to increase its market share by over 60%. With the changes Coca Cola is currently undergoing, they aim to regain an iron fist control of the market. Target market various age groups and lifestyles from high school students too universities, and male or female.
Part VII Conclusion and Recommendation A. CONCLUSION
After thorough research, we come to the conclusion that the marketing strategy of Coca Cola is working for them and the product is gaining popularity among youth day by day.
After completing our project we have concluded some recommendation for the coca cola company, which are following.
• • • •
Coca Cola Company should try to emphasis more on providing their infrastructure in the market to facilitate their customers. Marketing team should try to increase the availability of Coke in rural areas. They should also focus the old people. Now young generation has a trend to drink coke 2 regular bottles at same time, so providing more satisfaction to them company should introduce ½ liter disposable bottle.
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