Introduction
For every business entity’s success, it must focus on its marketing and management activities as these will determine the achievement of the goals and objectives. Identifying, reaching, and maintaining frequent interaction with the business entity’s customers is also essential to be considered by management and the organization in general. With the current digitalized world, there is a rise in competition between companies as they have different marketing approaches that can help achieve a given goal and objective. For effective execution of marketing strategy, business entities/firms should develop an effective marketing plan. The plan helps define its goals and objectives, the time it can be achieved, and how best to achieve them. Coca Cola Company is one of the organizations that are prominent globally due to its products and services offered across the globe (Štofová & Kopčáková, 2020). It is a big beverage company with a good brand image recognized by the large population of the world, thus giving it an advantage. Its products are available in most countries across the globe; hence, this has ensured its market position.
Functional activity of the company
There are various functional activities that business entities can engage in depending on their goals, objectives, products, and services provided. The coca-cola company bases its areas on human resources, production/ manufacturing, and administration. These are its primary functional areas that have ensured its success today.
- Human Resource
Human resource is an essential body in every organization to ensure its daily business operations are effective (CCFA, 2017). The department ensures effective employee recruitment with adequate skills and experiences that match the organizational goals and objectives. The human resource department of Coca-Cola Company, in this case, plays this role by ensuring the best people are recruited for the right job (CCFA, 2017). The department plays a role in ensuring the employees’ working environment is safe and secure to support business operations (CCFA, 2017). For example, the department ensures that the right drivers are recruited; hence this will lead to honesty and happiness amongst them when undertaking some business. The coca-cola company HR department ensures the employees are skilled and experienced to promote honesty and happiness in what they do in their working environment (CCFA, 2017). A framework helps the department know how they effectively identify the right employees if paid on time, their job attendance, and punctuality. The Coca-Cola HR department also schedules their employees’ working days effectively, i.e., it makes sure that the employees only work over one time once a week (CCFA, 2017). For the promotion of high productivity and quality work, training is made mandatory for employees of ages sixty-five and below, who then train themselves regularly.
- Production
Production is another functional area that the company focuses on to improve and have quality products that can be characterized as unique in the market (CCFA, 2017). The company’s production team/ department thus ensures quality assurance. It achieves by ensuring that other managers are effectively guided through their working environment (CCFA, 2017). The manufacturing areas’ employees are advised on what to do, and new ideas are produced, and further alternatives are brought into the manufacturing areas. The coca-cola production department aims at losing less in the yield annually and weekly.
The machinery pieces are improved regularly by the production department through the help of the microbiologists in the company (CCFA, 2017). The hygiene level is checked in the production line and raw materials to reduce/ avoid contaminations like molds, bacteria, and coli foams hence ensuring quality production. The organization’s production as a functional activity has over three hundred people in the production department, with over forty thousand people working in McDonald’s’ (CCFA, 2017). Comparing these two figures, it is evident that coca-cola uses more machinery than human labor. It is the case since coca-cola ensures it makes more production with over twenty-four thousand drinks made in every one hour (CCFA, 2017). This explains why coca-cola is growing faster than the MacDonald firm.
- Administration
This department aims to ensure that it does effective filling and organizational activities management effectively (CCFA, 2017). The administration acts as an eye to the coca-cola company since it promotes effective planning, participates in the organization’s decision-making, and guides the bosses and top managers when need be. The managers help meet schedules, charity activities, and local donations, among others by the administration (CCFA, 2017). The administration ensures that these activities are in line with organizational goals and objectives. It also works closely with other departments, i.e., the HR and the production departments, to manage other people accordingly to achieve the stipulated organizational goals and objectives.
Marketing mix of the company
Product
The company’s products are considered beverages that can be divided into the diet category of beverages, juice, and retail packaged water. The brand of the company includes Fanta, Maaza, and Sprite, among others that are readily available in the market across the globe (Štofová & Kopčáková, 2020).
Price
The distribution system of the company is advantageous as it meets and covers both the small and middle-level consumers in the market (Štofová & Kopčáková, 2020). The pricing of the company’s products is done according to the market and the geographical segment. In this case, competitors pricing, i.e., PepsiCo, in every given location, also determine the pricing of its products (Štofová & Kopčáková, 2020).
Place
Extensive distribution has made this possible and thus leading to erosion of the market share across the globe. The products are available across the globe due to the effective extensive distribution network that has captured even the rural market (Štofová & Kopčáková, 2020).
Promotion
The company has adopted various advertising and promotional strategies that have created an increase in demand in the market and also led to a good brand identity (Štofová & Kopčáková, 2020). It also uses CSR as a marketing tool that ensures the gaining of more consumers, i.e., through sponsorship.
SWOT analysis of the company
The coca-cola company is a brand that presents households, shops, and hotels, among other areas. Almost everyone in the society has at least interacted with its goods or services at one given point.
Through SWOT analysis of the company, the following can be identified;
Strengths
The company has an excellent brand identity, i.e., the coca-cola company receiving various awards, including the Interbrand award of 2011 for having the highest equity (Hitesh, 2019). It has a vast global presence and unique identity that ensures the costliest brand with the most increased brand equity.
The vast global presence of the organization is also the strength of the organization. Thus, coca-cola operates in over two hundred countries across the globe (Hitesh, 2019). It has opened up its market across the world hence promoting a good market position. Its goods are present in most countries’ markets, ensuring an effective building of the brand name.
The largest market share of the coca-cola company with the only two competitors is another organization’s strength (Hitesh, 2019). The beverage segment has only two competitors, with Pepsi being its closest competitor. Coca-cola is the best in the market, ensuring it has the largest market share with over five beverages promoting its growth drive, i.e., coke, sprite, and Fanta.
Coca-cola also has strong customer loyalty due to its strong products with many customers following, e.g., coke and Fanta. Most people would prefer these soft drinks over others because of the excellent taste hence the customer substituting it is challenging at times (Hitesh, 2019).
Weaknesses
Hence, Pepsi’s competition, limiting its chances of being an all-time clear market leader, is one of the coca-cola company’s weaknesses (Hitesh, 2019). The stiff competition between the two brands is immense as Pepsi works hard to take over the market as well (Štofová & Kopčáková, 2020).
Another issue is that the product diversification of the Coca Cola Company compared to Pepsi, is low (Hitesh, 2019). Pepsi has made a smart move by diversifying into the snacks segment. It has products like Lays and Kurkure that coca-cola is missing in its segment.
Water management is an issue that the company faces flak in for many years as a management issue hence a weakness (Hitesh, 2019). The company has faced lawsuits on the same with complaints on contamination of water bodies and a high water consumption level by the company.
The absence of healthy beverages as obesity remains a significant challenge today that affects society (Hitesh, 2019). Being a company that produces carbonated beverages is considered a major fat intake; hence there are chances that its products, especially in the developed countries, might go down. It could be the case as customers will opt for healthy alternatives provided by its direct competitors (Hitesh, 2019).
Opportunities
Diversification in the health and food business improves the coca-cola company customers’ needs (Hitesh, 2019). Better revenue can be promoted from the existing customers, and the supply chain of distributing the beverages can distribute snacks, thereby sharing supply chain costs loads.
Packaged drinking water as hygiene remains a significant factor (Hitesh, 2019). Thus, many customers opt for packaged drinking water to maintain a high hygiene level; hence this is one of the segments in the coca-cola company. Its packed drinking water has a slow expansion; therefore, the company should develop an effective strategy to expand Kinley as a brand to a top-level of trust among the customers.
Supply chain improvement with unpredictable transportation costs is something the company should focus on effectively (Hitesh, 2019). Since the company depends heavily on transporting its goods/ products for distribution, it should keep watch on its supply chain to keep the cost down by making improvements.
The market has lesser selling products; hence the coca-cola company can use this as an opportunity as several products are still struggling to find acceptance in the market (Hitesh, 2019). Thus, the company can identify the customers’ needs in regards to the products that have not found acceptance in the market by launching them to improve its revenue.
Threats
Raw material sourcing, including water, is a significant threat to the company as it is suspected of contaminating the water bodies with pesticides and vast water consumption (Hitesh, 2019). Water scarcity is on the rise due to climate change in many countries; hence soon, the company may have fingers raised on it as a result. If the water supply is the rationale, the company can have its revenue downfall.
Indirect competitors like the coffee chains are another threat the coca-cola company is facing as a threat (Hitesh, 2019). Thus, the customers might opt for indirect competitors’ products for healthy consumption, i.e., products that lack carbon. Such indirect competitors might seem not to be competitors but are indirectly stealing away the market share as they give a dent to the coca-cola beverages in the market.
Analysis and Recommendations
The sector is too large and lacking a quality health attribution that can ensure it succeed in an increasingly health-conscious marketplace (Puravankara, 2007). The number of beverage sales of coca-cola is declining with Pepsi, the direct competitor overtaking it in market capitalization. Pepsi changed and improved its policy diversification and investment into a new health-conscious brand (Puravankara, 2007). Therefore, there is a need for coca-cola company to have a positive health attribution to increase its success that is likely to be affected by the increasingly health conscious market place. Coca Cola Company should compete aggressively in the new age beverage sector by having a global and domestic market for energy drinks, bottled water, and noncarbonated drinks. It should venture on the noncarbonated soft drinks and accommodate the new generations’ needs that entail the millennials that are health-conscious consumers (Puravankara, 2007).
This is a major trend in the beverage market hence a drive to innovation that the coca-cola company should consider (Puravankara, 2007). The consumption pattern of the consumers is shifting to products that are considered healthier, and those with fewer adverse side effects (Štofová & Kopčáková, 2020). Thus, people change from regular cola carbonates to low-calorie carbonates, bottled water, white tea, and other products. The obesity controversy is slowly shaping the soft drink industries, and Coca Cola Company should not be too slow to act accordingly (Puravankara, 2007). Parents are concerned about their children’s activeness and their weights; thus, it can affect the potential consumption of coca-cola products in the future. Coca Cola Company should provide industry leadership in the health and wellness arena, just like PepsiCo has already done (Puravankara, 2007). It should promote innovation and create value by understanding its consumer demographics as it tries to meet their needs. Thus, it should understand its market needs to ensure it does not miss the opportunity to buy its products.
The competitor’s stiff competition remains a major threat due to dominance in the growing noncarbonated beverages sector (Puravankara, 2007). This meets the needs of the consumers that coca-cola has left out due to its carbonated products. Therefore, it should focus on noncarbonated products by having adequate diversification and investment in the new health-conscious brands (Puravankara, 2007). Hence, this will lead to a market capitalization that PepsiCo has taken over today. It should develop some strategies that will ensure it wins the Cola war to maintain its industry leadership position and be fully a beverage company. PepsiCo will remain a threat to the company if it only focuses on the carbonated soft drink beverages (Puravankara, 2007).
There is a need to develop the agility to the changing customers, and consumers demand through introducing new products and formats that are planned and executed effectively (Puravankara, 2007). Coca-Cola has neglected its products while its competitor has adapted to consumer needs, increasing its market value. In this case, innovation is vital in ensuring that the largest single opportunity to make a profit is promoted at every organizational level (Puravankara, 2007). The company should have some diversification into new products and have an active role in ensuring change through effective innovation. It should implement flexible strategies to the market demands hence leading to demand in the shelf-space (Puravankara, 2007). The product line of coca-cola should be expanded, and it should also focus on continuous product innovation to increase its profits and ensure its growth.
Conclusion
The coca-cola company has a competitive advantage that can be improved on through having effective strategies (Štofová & Kopčáková, 2020). Therefore, it is essential that the coca-cola company expands its production to win more customer loyalty and operate better than its competitors. It is also necessary that the company become innovative and create and introduce new products consistently for its competitive advantage. Coca Cola Company should continuously monitor its environment for changes and learn from and adapt to the changes. It should shift into a learning organization based on research and development to improve and renew its competitive advantage. This activity can be effective through having strategic thinking that will ensure understanding of the external environment, emerging issues, strategic risks, and their impact on business rather than over-relying on strategic planning.
References
Coca Cola Functional Areas (CCFA) (2017). Retrieved from https://phdessay.com/purpose-activities-functional-area-internal-external-communications-coca-cola/
Hitesh Bhasin (2019). SWOT of coca-cola. Retrieved from https://www.marketing91.com/swot-coca-cola/
Puravankara, D. (2007). Strategic analysis of the coca-cola company (Doctoral dissertation, Faculty of Business Administration-Simon Fraser University).
Štofová, L., & Kopčáková, J. (2020). The Competition Strategy between Coca-Cola vs. Pepsi Company. Calitatea, 21(179), 40-46.Muchai, A. N. (2010). The Impact of New Product Development on Competitive Advantage of Coca Cola-Kenya (Doctoral dissertation, University of Nairobi).