Coca Cola

Coca-Cola

Executive Summary

In this paper, we perform a comprehensive audit of Coca-Cola’s marketing program and recommendations developed for future marketing plans. We provide recommendations for Coca-Cola's marketing efforts as well as product line enhancements, as Coca-Cola faces stiff competition and changing consumer tastes. These recommendations include:

· Pursuing a multi-pronged marketing strategy, including growth into geographic regions like Russia, China, and Turkey.

· Leverage the Company assets by brand extension into water-based, slightly sweetened refreshment drinks to meet more health-conscious consumers.

· Diversify offerings outside the non-alcoholic beverage market, leveraging the vast distribution network.

Introduction

Coca-Cola was born in Atlanta, Georgia, on May 8, 1886 by Dr. John Stith Pemberton, a local pharmacist. Dr. Pemberton produced the syrup for Coca-Cola®, and carried a jug of the new product down the street to Jacobs' Pharmacy, where it was sampled, pronounced "excellent" and placed on sale for five cents a glass as a soda fountain drink. Carbonated water was teamed with the new syrup to produce a drink that was at once "Delicious and Refreshing," a theme that continues to echo today wherever Coca-Cola is enjoyed. During the first year, sales averaged a modest nine drinks per day.

Today, over 6 trillion servings of Coca-Cola have been enjoyed worldwide and Coca-Cola has over 400 brands.

Coca-Cola's Key Success Factors

Coca-Cola has several key success factors including:

· Financial measures with growth in both revenue and gross profit. Revenue for the period ended September 29, 2006 is $6.454 million (USD) ; compared to $6.037 million (USD) for the same period in 2005, representing a 6.9% increase for the same period. Gross profit in 2006 for the period ended September 29, 2006 is $4.189 million (USD) compared with $3.802 million (USD) for the same period in 2005 ; representing a 10% increase.

· Strategic relationships with sporting events and a long-term sponsor of the Olympics. Coca-Cola has been a regular Olympic sponsor for 74 years and was the first soft-drink Olympic sponsor in 1928 . Coca-Cola also formed an early relationship with the United States military in World War II, offering every American soldier a bottle of Coca-Cola for 5 cents per bottle wherever that soldier was geographically located.

· Strong social responsibility. Coca-Cola is listed number 2 on the list for top-rated companies for social responsibility . In addition, Coca-Cola is looking to differentiate itself and become the recognized global leader in corporate social responsibility and has recently launched an audit of labour practices throughout the Coke supply chain .

· Brand itself. Over the years, Coca-Cola has built a huge portfolio of products, many customized to the local market. Coca-Cola has also built the brand by innovating: the contour Coke bottle premiered in 1915 and is still available today. Coca-Cola introduced new flavors in the 1960's including Sprite, TAB, and Fresca. And, in 1978, Coca-Cola was the only company selected to sell packaged cold drinks in People's Republic of China .

Coca-Cola Potential Vulnerabilities and Competition

Coca-Cola's major competition comes from two different sources: tap water and Pepsi although Coca-Cola has at least 27 major competitors. Pepsi, the closest major competitor is also known as PepsiCo Inc and provides a broad product line including Gatorade sports drinks, Aquafina bottled water, Tropicana orange juice, Frito-Lay and Doritos snacks (traditionally prepared and baked), Quaker Oats, Propel flavored fitness waters, and Lipton’s ice teas. Pepsi's snack food empire and entrance into the "healthy" junk food markets capitalize on Pepsi's recent ability to be trend savvy as well as foreign expansion. Pepsi is also looking to acquire Naked Juice to compete with Coca-Cola's line of Odwalla juices. Pepsi's also been able to attack Coca-Cola in places like the grocery store, vending machines, and fast food , where Coca-Cola previously enjoyed limited competition.

Regardless of how one looks at the competition, the main concern is that 60% or more of Coca-Cola's business is in soft-drinks. And, consumer demand is shifting from soft-drinks to healthier drinks and snack foods.

In addition to PepsiCo, Unilever, Cadbury, and a host of other competitors work diligently