The Coca-Cola Company

History of the Company

Coca-Cola began in 1886 when the curiosity of an Atlanta pharmacist, Dr. John S.

Pemberton, led him to create a distinctive tasting soft drink that could be sold at soda fountains

Back in 1886 pharmacist name John Pemberton was experimenting a new recipe he
took some secret ingredients and boiled them into a syrup, he thought it was pretty tasty. He
took some to Jacobs pharmacy where they mixed the syrup with plain water and placed it on
sale for five cents a glass. The employee of the pharmacy accidentally mixed with the syrup with
carbonated water and served it over ice to a customer well the customer absolutely loved it.

Background of the Company

Coca-Cola is the largest beverage manufacturer and distributor in the world and one of
the largest corporations in the United States. The company was established by Doctor John
Pemberton who was a pharmacist in 1886 in Atlanta, Georgia USA and has over 3000
beverages products and has about 500 brands in its portfolio. In 1928, Robert Woodruff, whom
was the company's president at that time, led the expansion of Coca Cola overseas when
introduced the Coca Cola to the Olympic games for the first time. In the 1960s the company
decided to expand with new flavors- Fanta, Sprite and Fresca, In addition it acquired the Minute
Maid Company, adding an entirely new line of business juices to the company. In the 1980s,
The Diet Coke was introduced, which become the top law-calorie drink in the world. The brand
has since become household drink in over 200 countries across the globe. Carbonate drinks are
the single largest component in Coca-Cola Company which account for about 78% of the total
volume sold in the 2008. American corporation founded in 1892 and today engaged primarily in
the manufacture and sale of syrup and concentrate for Coca-Cola, a sweetened carbonated
beverage that is a cultural institution in the United States and a global symbol of American
tastes. The company also produces and sells other soft drinks and citrus beverages. With more
than 2,800 products available in more than 200 countries,

The ‘Coca-Cola’ brand has been adopted the strategy of global marketing. Business
decisions are made on a domestic basis to fit in with the culture and needs of the domestic
community. Because of successful and efficient marketing research Coca-cola was able to
produce globally in different regions of the world.
 SWOT Analysis of The Coca Cola Company

The Coca-Cola Company (TCCC) is a leading manufacturer, distributor and marketer of

non-alcoholic beverage concentrates and syrups. The company's strong brand value facilitates
customer recall and allows Coca-Cola to penetrate markets.

STRENGTHS

 Brand equity/image & recognition. Coca-Cola is the world’s most valuable brand and
has strong brand loyalty. Coca Cola is an extremely recognizable company. Popularity is
one of its superior strengths that are virtually incomparable. Coca Cola is known very
well worldwide. It's branding is obvious and easily recognized. Without a doubt, no
beverage company compares to Coca Cola's social popularity status.
 Strong advertising. Coke primarily competes on advertising and differentiation and has
high market share along with being a dominant market leader. Extensive advertising,
acceptable promotions or business programs is a strength of this company.
 Customer loyalty. Coca- Cola has enormous number of loyal customers and brand
equity all over the world. The 80/20 rule comes into effect in this situation. Eighty percent
of their profit comes from20% of their loyal customers.
 Product distribution and worldwide network. Wide variety of Coca Cola products is
sold in the restaurants, stores and vending machines over 200 countries. It has
enormous distribution and production facilities of non-alcoholic beverages and related
product.
 Product diversification. This is an important reason which adds to its strengths. The
company has a wide range of diversified products for example water, juices, soft drinks,
sport drinks, etc.
 Solid financial performance. The company has strong financial position and profits
throughout the history. Like all businesses, they have had their ups and downs
financially, but they have done well in this compartment and will continue to do well and
improve.
 Corporate Social Responsibility (CSR). Coca Cola is increasingly focusing on CSR
programs, such as recycling/packaging, energy conservation/climate change, active
healthy living, water stewardship and many others, which boosts company’ social image
and result in competitive advantage over competitors.
WEAKNESSES

 Significant focus on carbonated drinks and beverages. Unlike most company’s

competitors, Coca Cola is still focusing only on selling beverage, which puts the firm at
disadvantage. The overall consumption of soft drinks is stagnating and Coca Cola
Company will find it hard to penetrate to other markets (selling food or snacks) when it
will have to sustain current level of growth.
 Lack of popularity. Lack of popularity of many of Coca Cola’s drinks. Many drinks that
they produce are extremely popular such as Coke and Sprite but this company has
approximately 400 different drink types.
 Large external debts. The company is facing high burden of external debts for the last
few years. In 2002, long term debt of the company was 2700 million dollars
 Health issues. The Coca Cola Company is still focusing on selling Coke, Fanta, Sprite
and other carbonated drinks. This strategy works in short term as consumption of
carbonated drinks will grow in emerging economies but it will prove weak as the world is
fighting obesity and is moving towards consuming healthier food and drinks. Another
weakness that has been greatly publicized is the health issues that surround some of
their products and how they could be detrimental to one’s health. However, Coca-Cola
hasn’t devised any health alternative or solution for this problem yet.
 Environmental Issues. The Coca-Cola Company is the single largest plastic polluter in
the world, producing over 3 million tons of plastic packaging each year including 110
billion plastic bottles.
 Water scarcity. Water is becoming scarcer around the world and increases both in cost
and criticism for Coca Cola over the large amounts of water used in production.

OPPURTUNITIES

 Growing bottled water market. Bottled water is one of the fastest-growing segments in
the world’s food and beverage market owing to increasing health concerns. Coca-Cola
could leverage its strong position in the bottled water segment to take advantage of
growing demand for flavored water.
 Diversification of product range. One of the biggest opportunities is to diversify into
the non-carbonated drinks such as coffee, water, juices, etc. It also can diversify into
 complementary food products which will ultimately increase the drink consumption.
Partnership- Coca cola should increase its partnership with fast food chains.
 Healthy options. Consumers increasingly understand the importance of healthy diets
and are actively looking for healthier drinking options. Increasing demand for healthy
food and beverages. Due to many programs to fight obesity, demand for healthy food
and beverages has increased drastically. The Coca Cola Company has an opportunity to
further expand its product range with drinks that have low amount of sugar and calories.
 Environmentally friendly packaging. Finding better solutions towards its problem with
pollution, it is an opportunity to have all packaging from recyclable, renewable,
or environmentally responsible sources.
 Advertise its less popular brands. Coca Cola also has the opportunity to advertise its
less popular products. With a large income it has the available money to put some of
these other beverages on the market. This could be very beneficial to the company if
they could start selling these other products to the same extent that they do with their
main products.
 Acquisitions of smaller players. Another opportunity that could be seen being put to
use before is the ability for Coca Cola to buy out their competition. This opportunity
rarely presents itself in the world of business. However, with Coca Cola’s power and
success, such a task is not impossible. Coca Cola has bought out a countless number of
drink brands. An easy way to turn their profit into your profit is too buy out their company.
 Partnerships. Coca cola should increase its partnership with fast food chains and other
potential industries.
 Supply chain improvement. Supply chain can be a major cost sink hole with the
transportation costs always rising. Coca cola’s complete business is based on
transportation and distribution. There will always be possible improvements in this area.
Thus Coca cola should keep strict watch on its Supply chain and keep improving to bring
the cost down.
THREATS

 Changes in consumer tastes. Consumers around the world become more health
conscious and reduce their consumption of carbonated drinks, drinks that have large
amounts of sugar, calories and fat. This is the most serious threat as Coca Cola is mainly
serving carbonated drinks.
 Raw material sourcing. Water is the only threat to Coca cola. The weakness of Coca cola
was the suspected use of pesticides or vast consumption of water. However, the threat here
is that water scarcity is on the rise. With the climate changing, and regions of various
countries facing scarcity of water, sooner or later someone might raise fingers on beverage
companies. Coca-Cola has faced many criticisms over its water management issue. Many
social and environmental groups have claimed that the company has a vast consumption of
water in water-scarce regions. Thus, Water sourcing is an axe which can fall anytime on the
head of Coca cola. If water is limited or rationed, Coca cola can experience a major downfall
in their revenue and capacity of distribution. The same can affect its arch rival Pepsi as well.
 Packaging controversy. Greenpeace censured Coca-Cola in its published report in 2017
for its use of single-use plastic bottles. It has also been criticized over its recycling and
renewable sources.
 Direct and Indirect competitors. PepsiCo remains a considerable foe in soft drinks and
having stolen a march in terms of bottler buyouts, it has possibly a crucial advantage in
terms of repositioning itself in a redefined marketplace. However, coffee chains like
Starbucks, Café coffee day, Costa coffee are on the rise. These chains offer a healthy
competition to Coca colas carbonated drinks. They might not be a big competition for Coke,
but they do give a dent to its beverage market.
 Laws. Legal requirements to disclose negative information on product labels. Some Coca
Cola’s carbonated drinks have adverse health consequences. For this reason, many
governments consider to pass legislation that requires disclosing such information on
product labels. Products containing such information may be perceived negatively and lose
its customers.
 APPLICATION OF INNOVATION AND TECHNOLOGY

As a company, Coca-Cola constantly changes, rebrands, advertises for and presents

their products in order to keep sales consistently high. Since the dawn of social networking, the
green movement and the ability to stay constant connected to the Internet, Coca-Cola has
continually harnessed new technology in a variety of ways to further the brand.

 Online Advertising. Coca-Cola uses subtle yet effective online advertising to make you feel
like you want its products. Targeted advertisements on websites mean that Coca-Cola has
greater control over who sees their ads and when they see them.
 Social Networking. Coca-Cola maintains a visible appearance on Facebook and other
social networking sites such as Twitter. With over 100 million fans as of 2019, Coca-Cola
harnesses the power of social networking to spread the word concerning new products, test
advertorial campaigns, invite users to play games and associate Coca-Cola products with
positive feelings. Using social networking technology enables a brand to stay young, fresh
and current.
 Greener Bottles. Coca-Cola introduced greener bottles and packaging in 2009, producing
2.5 billion of their products using less petroleum. In 2015, The Coca-Cola Company
unveiled the world’s first PET plastic bottle, “PlantBottle”, made entirely from plant materials
at the World Expo in Milan, Italy. Packaging pushes the boundaries on sustainable
innovation by using groundbreaking technology to create a fully recyclable plastic bottle
made from renewable plant materials. The practice has been so successful that other
companies, such as Heinz, have harnessed this technology to create greener packaging as
well. While the 2009 production represents only three percent of Coca-Cola's packaging, the
movement continues to grow, as billions of cases of Coca-Cola products are shipped
globally each year.
 Freestyle Dispensers. Coca-Cola began rolling out its freestyle dispensers in late 2010 and
early 2011. Unlike typical soda fountains, the freestyle dispenser allows you to create your
own beverage by choosing from over 100 drinks in various combinations. Not only does
freestyle technology allow a greater variety of drinks through its computer-like interface, but
the dispenser records information concerning consumers' drink choices, then sends the data
back to Coca-Cola as market research.