Coca-Cola Essay Example

  • Category:
    Marketing
  • Document type:
    Assignment
  • Level:
    Masters
  • Page:
    2
  • Words:
    1265

Marketing 7

Table of Contents

2Introduction

2Coke sales

3Segmentation

3Competition for coke

4Energy drink players

5Look up people who drink energy drinks

5Conclusion

6References

Introduction

The coca-cola company is the American largest multinational which deals with beverage manufacturing, retailing and marketing. Murden (2005) shows The Company’s brand was invented in 1889 and it currently offers 500 brands in more than 200 countries serving an output of over 1.6 billion daily. The company basically produces syrup concentrates which are sold to various bottlers found all over the world, with its headquarters in Atlanta, Georgia. The above study gives the coke sales, segmentation, competition and energy drink players in the market.

Coke sales

According to Jeremiah (2011) the Coca-Cola Company’s sales grew by 18 percent in the second quarter of 2011. The various places that contributed to the growth include in Latin America and Asia. The net income is currently 2.8 billion dollars from the previous 2.37 billion dollars. The profit per share amounted to 1.17 dollars. The increase in sales has resulted from the introduction of new plants in emerging markets which pushed more package sizes therefore helping to offset pricing gains. The company also invested in distributing in emerging markets and gaining points of sale. Duane (2011) shows the total sales rose by 47 percent which was facilitated by the last year’s acquisition in the latest distributor. The volume sales in China fro example rose by 21 percent. This has resulted to the need to introduce smaller packages that are more affordable and will bring more revenue therefore boosting profit. The company also aims at increasing more choices according to consumers’ needs which has increased sales in places such as Latin America and Eurasia. Sales in North America increased by 4 percent and were boosted by new distribution of Dr. Pepper brands (Duane 2011).

Segmentation

This involves how companies determine the markets in which they need to concentrate their commercial efforts. It also involves having a greater diversity in customer needs and the capability to reach specialized niche segments. Eric (2010) shows segmentation enhances a company’s competitive position for example by providing direction and focus through targeted advertising, new product development and brand differentiation. The coca-cola company identified that Diet Coke brand was more regarded as feminine by male customers. This therefore enabled the company to develop a new product branded as coke zero targeting the health-conscious male segment.

Competition for coke

Coca-cola Company has two major direct and equivalent competitors which include PepsiCo and Dr. Pepper Snapple Group. Pepsi is usually second after Coke in sales volumes though in some outlets it may outsell coke. Alford et al. (2001) the locally produced drinks are also competitors of coca cola for example in India; coca cola is ranked third after Pepsi-cola and Thumbs Up. Coca cola has therefore faced threats from entry of new strong competitors in the sift drink and beverage industry. Pepsi for example offers same range of products and at the same price or lower. The threat caused by Pepsi is significant as it is not easily eliminated by production of quality products.

According to Michael (2007) researchers have found that the difference between the two brands is all in consumers head since coke’s brand image causes consumers to think that it tastes better than Pepsi. Over the decades, Coke’s global reach has given it an edge in the region increasing it growth. Pepsi however, has been successful with snack foods though the market may be difficult to maintain as more consumers are currently avoiding salt and fats. Coca- cola and Pepsi in 2005 engaged in cyber-war through the introduction of Pepsi stuff. Coca-cola on the other hand introduced Coke rewards where it offered prizes on their websites. These were loyalty programs of collecting bottle caps and submitting the codes to earn points.

Energy drink players

More and more people currently prefer energy drinks especially during the day. These beverages are meant to energize the consumer and help in alertness as one carries our daily activities. The energy drinks contain caffeine or taurine as well as herbal ingredients for example ginseng and other vitamins and minerals. Marczinski et al. (2011) describes that Coca-cola offers various energy drinks for example power play available in herbal flavor in Namibia and South Africa. Ingredients and nutrients contents vary depending on the energy drink selected therefore enabling people to live active and energy lifestyles. Some of the energy drinks offered by coca-cola include burn, gladiator, power play and relentless. Coca-cola marketed Powerade energy drink in 2001 in bullet- shaped aluminum bottle cans which is regarded as the safest energy drink (Sharma 2008).

Look up people who drink energy drinks

The coca-cola company cares for its consumers’ health and well-being. They also want to make a difference in their lives both physically and emotionally through the provision of beverages, their marketing and offering nutritional information that encourage active living. The energy drinks promotes peoples’ active and healthy living. Terry (2005) describes that caffeine for example gives people a temporary energy boost and elevates mood for example through Diet coke. The drinks also have physiological and psychological effects as research shows that it has mental and cognitive performances and increased alertness.

It is also shown that increased consumption of energy drinks results to induce mild to moderate euphoria. This is caused by the stimulant properties of caffeine. Consumption of energy drinks also induces agitation, nervousness and insomnia. In young healthy adults, energy drinks increase upper body muscle. Caution should therefore be taken by people who consume two or more drinks in a day. Consumption also causes pupil dilation especially when taken with antidepressants. It may lead to dehydration which may reduce performance (Van Den Eynde et al. 2008, pp. 27-81).

Conclusion

Coca-cola company has grew up with roots planted in local communities and this has led to serving the company well as more and more people seek brands that honour local identity and those that are distinct from local markets. The company has also grown as a result of strong relationships between customers, distributors and the local communities. Some of the ways that the company aims at achieving in order to maintain superior growth includes; expanding internationally where sale of soda are still at the growth stage for example in Brazil, China and Russia. The other approach is to watch heath concerns for example through the introduction of carbonated beverages with no sugar such as Coke Zero. Finally it is to expand on noncarbonated beverages such as Minute Maid and Dasani bottled water.

References

Alford, C, Cox, H & Wescott, R 2001, The effects of red bull energy drink on human performance and mood, Macmillan, New York.

Duane, S 2011, Coca-Cola Profit Jumps 18% as Sales Gain in Latin America, viewed 15 August 2011, <http://www.bloomberg.com/news/2011-07-19/coca-cola-earnings-increase-18-as-sales-gain-in-latin-america.html>

Eric, N 2010, Product segmentation strategy, viewed 15 August 2011, <http://www.ehow.com/about_6660008_product-segmentation-strategy.html>

 http://www.ajc.com/business/coca-colas-sales-profits-925051.html>, viewed 15 August 2011,< Atlanta Journal, TheCoca-Cola’s sales, profits rise in first quarter2011, Jeremiah, M

Marczinski, C, Fillmore, M, Bardgett, M, Howard, M 2011, Effects of energy drinks mixed with alcohol on behavioral control, Risks for college students consuming trendy cocktails, Clinical and Experimental Research, vol. 35, no. 7. Pp.78-89.

Michael, S 2007, In cola wars, Coke now has the edge, viewed 15 August 2011, <http://money.cnn.com/2007/04/12/magazines/moneymag/colawars.moneymag/index.htm>

Murden, T 2005, Coke adds life to health drinks sector, Scotland on Sunday.

Sharma, A 2008, Water in Coca-Cola in India pesticide free, USA Today.

Terry, M 2005, Coke adds life to health drinks sector, Scotland on Sunday. UK.

 Van Den Eynde, F Van Baelen, P Portzky, M & Audenaert, K 2008, The effects of energy drinks on cognitive performance, vol.50, no. 5, pp. 27–81.