Coca-Cola Shift to a One-Brand Strategy Case Analysis

Global Marketing Management - Group Project

Winter 2024 Term A

Lorenzo Peccini, Charles Mosca, Giselle Gourguechon,

Paula Villabla, and Lily Berry
Introduction
The Coca-Cola Company (TCC) stands as an iconic global soft drink brand,
renowned for its product, the timeless and classic “Coke”. Throughout its history,
TCC has implemented different and diverse techniques for marketing that have
allowed it to be positioned as a top beverage worldwide. For decades one of TCC’s
strongest marketing strategies was cultivating the idea of the Coca-Cola brand in the
minds of consumers. One of the leading global marketing campaigns was the “Open
Happiness”, creating this perception of happiness equals Coca-Cola. This approach
proved to be successful, this contributed TCC to having a strong brand identity and a
compelling value proposition.

In recent years the preferences of consumers have been shifting. This attitude of
consumers is coming from the change of lifestyle and opting for healthier and less
sugary drinks. The change in global consumer preferences has reshaped the
beverage landscape. In addition, various governments, recognizing the health
implications, have imposed taxes on sugary drinks to combat the rising obesity rates.
This global shift towards healthier choices and regulatory interventions has
introduced new challenges for TCC, requiring the company to adapt and change its
strategy to the evolving market.

Having experienced sales losses and a continuous decline in soda consumption

TCC found itself forced to take decisive action. The following strategy they
implemented turned out to be controversial and much debated. The idea was to
combine all the sub-brands into one brand. Under the Coca-Cola umbrella, the
brands include Diet Coke, Coke Zero, and Coke Life. The integration of these “diet:
sub-brands" was deemed essential to address the shifting landscape of consumer
lifestyles. The primary challenge was the perception that these different products
were catering exclusively to specific consumer types, rather than aligning with the
cohesive and unified ideology of Coca-Cola. In this case study we will analyze the
key components such as identifying the problem and symptoms of TCC’s marketing
campaign. Additionally, we will explore potential solutions, and actions needed to
take to confront the challenges TCC is facing.
Key Problems and Symptoms:
As upcoming generations idolize a cleaner lifestyle, the market for soft drinks has
adopted a healthier taste. This shift in consumer preferences has left TCC with a
loss in retail sales (3% in 2013 worldwide to -1% in 2015 worldwide, Exhibit II) and in
turn a slowing revenue growth (0.1% in 2015 to -16.0% in 2017, Exhibit VIII).
Moreover, TCC is experiencing a loss in market share as consumers are purchasing
less of their soft drinks and healthier lifestyle options such as vitamin waters and
juices (Exhibit IX).

As a long-term contributor to the market, TCC has a pre-obtained negative

perception as a high-sugar beverage that consumers no longer resonate with,
contradicting the “taste the feeling” philosophical image of the brand. Though TCC
has adapted its product to the dynamic market, the union of all sub-brands and
variations due to the One Brand strategy has led to the dilution of the distinct
purposes of their sub-brands, like “Coke Life” and “Diet Coke”. Under the master
brand of “Coca-Cola”, the negative perception of the “sugary” beverage has
stemmed into all sub-brands.

However, the main problem TCC is facing is a detrimental negative brand perception
in the eyes of new consumers. However, one of the pillars of TCC’s brand survival
has been its loyal customers. TCC’s core following of customers that quickly identify
their variable tastes and consider the product unique with very few alternatives are
the loyal following that gives TCC its unique brand advantage in the soft drink
market. According to Pareto’s Law, the top 20% of customers are to generate 80% of
the revenue. However, rather than focusing on its core following, TCC's One Brand
marketing strategy proved to disappoint loyal customers as the essential emotional
association with happiness was no longer there. This also would affect the revenue
growth of TCC, as the core following would contribute to the 80% of TCC's revenue.

Several important marketing theories and techniques are applied in the example of
TCC's marketing evolution. The idea of brand positioning is one important
component. TCC has a history of connecting its brand with happiness through
programs like "Open Happiness." The introduction of the "Taste the Feeling" ad
signaled a shift in the brand's attitude as the emphasis on emotional appeal gave
way to a product-centric approach. The arrangement and structure of a brand's
portfolio is known as brand architecture, and it is another important concept when it
comes to the essential value proposition of TCC.

TCC substituted the 'One Brand' worldwide marketing effort for its dispersed
sub-brand strategy. Presented under a single "master brand," all
variations—including Diet Coke and Coke Zero—were intended to streamline and
harmonize the brand architecture. This strategy of behavioral segmentation was also
included as an important principle that TCC has included into its marketing strategy.
The business saw that customers were not completely aware of their options inside
the Coca-Cola master brand. The 'One Brand' approach addressed this by
emphasizing sugar-free options, which matched evolving consumer desires for
healthier options. TCC's "Open Happiness" and "Taste the Feeling" campaigns show
how they used a range of advertising techniques. This is a great example of
integrated marketing communication (IMC). These advertisements demonstrated an
integrated approach to marketing since they were made to appeal to various markets
depending on their location.

Additionally, the case supports the principle of the product life cycle. In 1886 when
Coca-Cola was first introduced, to tackle the decline in soda consumption in the
twenty-first century, the company has proven that they are capable of successfully
implementing solutions aimed at different stages of the product life cycle. Targeting
and market segmentation are widely shown and demonstrated in TCC's ads, such as
the "Share a Coke" campaign that provided customers with customized bottles to
interact with them. The case discusses brand equity, a metric for assessing the
power and value of a company. Interbrand's rating of TCC showed a loss in brand
value, raising concerns about their 'One Brand' approach and the effect it might have
on TCC’s reputation. Lastly, TCC's responsiveness to external factors such as
changing consumer preferences, health trends, and competitive pressures
exemplifies the application of marketing strategies to stay relevant in the
ever-evolving beverage sector.
Solutions
The solution we suggest is to focus on existing customers and customers who slowly
drifted away from consuming Coca-Cola and try to change the general perception of
the brand. Get the public to associate the brand with good and positivity rather than
with bad and negativity.

On the threshold of this transformative adventure, we recognize the complexity

inherent in the iconic Coca-Cola for TCC. Initially, the quest for a new drink to win
back health-conscious customers was considered but proved to be a daunting
challenge. TCC has already attempted to innovate and enter the market with new
types of drinks, from sports drinks to water and juices. However, these have not
been able to save Coca-Cola and its decline in the past years.

The vision that TCC should embrace is the exciting idea of making Coca-Cola the
engine of global well-being and associating them with the positive idea of good,
rather than the negative perception of unhealthy. For years they have been
associated with bad, but now we want to change the public’s first thoughts and
opinions and want them to think of good. We call on Coca-Cola to become the
creator of happiness and positive impact, where drinks are no longer simply
refreshments, but messengers of joy carrying a sincere commitment to causes that
resonate with our deepest beliefs.

We would like to bring back Coca-Cola’s “Taste The Feeling” approach but focus less
on the product and rather send a message of deserving Coca-Cola. Imagine a
Coca-Cola event dedicated to cleaning up a beach, where committed individuals
come together to restore nature to its splendor. At the end of a hard day of work, a
special reward awaits these hard workers: refreshing Coca-Cola drinks to share,
symbols of their contribution to a day of positive action. The message would be more
about sharing the moment and deserving a cold Coca-Cola. These events can be
fully funded by TCC and drinks provided by them. People will start thinking more
about the positive impact Coca-Cola creates rather than the unhealthy sugary drink.

Our strategic shift is based on concrete proposals, including captivating advertising

campaigns, meaningful partnerships with NGOs working for the common good, and
dynamic community events woven with commitment. Social Media influencers can
also be invited to help promote these community events and spread the message
across all platforms. Additionally, transparent communication, echoing our values,
will be naturally integrated into our points of sale.

Our ambition is bold: to expand Coca-Cola's influence beyond the simple fizzy
enjoyment it provides. We aspire to shape a positive force, capable of raising smiles
and actively contributing to the creation of a better future. This vision embodies a
vibrant call for a caring revolution, where every sip of Coca-Cola becomes a
celebration of happiness and kindness towards our planet and communities.

Using these forms of events, from sports to helping the communities and our planet,
TCC can achieve many things. Firstly, they bring communities together and there is
always a positive message to that, such as sharing a Coca-Cola. It will also help the
brand remain top of mind and relevant. It will help generate more brand image and
remind people of the refreshing taste of Coca-Cola. These events can also be a tool
to create videos for marketing campaigns and involve celebrities and influencers who
can focus on promoting the event and not the brand. All should be centered around
the events and the positivity they bring so people’s perceptions towards the brand
can change. People will stop associating them with unhealthy and sugary and back
to happiness and sharing, a drink for everyone, and a well-deserved refreshment
after a long day of work.