1003Mkt The Coca-Cola Company History Assessment Answer

Answer:

There is a global shift in favour of healthy living especially in the industrialised countries which is spurred by an increase in consumer’s awareness of the relationship between the health and lifestyle. Also, a spike in lifestyle-related illnesses has lead people to search for healthier alternatives to their usual foods and drinks. The health beverage market has embraced the change and is one of the fastest growing sectors in the Australian economy, and by entering the market, Coca-Cola aims at leveraging its huge presence in the country to bring a variety of healthier beverages to the consumers.

Company Background

The Coca-Cola Company started in Atlanta by a pharmacist John Pemberton. From the humble beginnings of selling nine glasses of the drink to a few of his friends, Pemberton grew the company to become a household beverage brand across the globe. The Coca-Cola Company is a beverage business dealing with the production and sale of a variety of soft drinks including Coca-Cola, Fanta and even drinking water.   

History of the company 

Asa Griggs Candler acquired the rights to the Coca-Cola brand three years after the company started producing the beverage. He was able to turn the bottling company to a multibillionaire enterprise with footprints in most parts of the world. Asa Candler turned out to be an adept salesperson and marketer and through various marketing strategies to position his business in such a way that people noticed it everywhere.

He was aggressive in promoting the brand including issuing out coupons to people who could taste his drinks to ensuring that every scale, clock calendar distributed by pharmacists bore the Coca-Cola brand. People paid attention as the company’s name was everywhere making its products the most consumed in the area. The Coca-Cola Company gained momentum and was able to expand to other US territories and later to other countries across the world (Pendergrast 2013).   

The idea to start Coca-Cola, Australia took root in 1917 when an accountant in Perth applied for rights to start a Coca-Cola company, but the dream came true with the establishment of the first bottling plant in Sydney. In 1937. The breakthrough for the company happened when the Woodruff, the Firm’s president decided to supply the US troops with Coca-Cola products. After the world war, the company issued franchises and became the gradually became the behemoth it is with over 240 varieties of beverages and a huge revenue base (Journey Australia Staff 2017).  

Situation Analysis

Market Analysis

<Indicate what is happening in the marketplace – use statistics as well>

The US market for the Kombucha health beverage in 2017 was estimated to be worth USD 1.5 billion, and it was expected to grow with at least 17.5% between the periods 2018 to 2023. The market is competitive following the increased consumer awareness and preference for healthy living. People across the industrialised world have realised that unhealthy lifestyles including consumption of junk food and dependence on chemicals to treat ailments are some of the factors contributing to a spike in the prevalence of lifestyle diseases.

The increase in demand for healthy products like Kombucha has seen the entrance of various producers and marketers of the products to supply the products making the market for these products very competitive. Japan and China are the leading lights in the production and consumption of probiotics such as Kombucha, raking in the lion’s share of the USD 14.1 billion worth of revenues from the products (Whithead 2018).

In Australia, the market for Kombucha has grown in leaps and bounds chiefly because Australia is one of the most health-conscious cultures in the industrialised world. Due to the Australians’ obsession with all things health and wellness, the market for probiotics and healthy tea like Kombucha has expanded rapidly. The same love for a healthy living has contributed to the development of a complex and sophisticated health system with top of the range technology.

The first company to produce Kombucha commercially was MOJO followed closely by other companies selling their brands of the product. Kombucha Remedy is a household brand name in the Australian Kombucha market. It is a product by a couple, Emmet and Sarah, who ran into the product while fermenting their daily provisions and took it to the global market. From hawking one bottle a day to local health shops, the product is now sold in most of the major retail outlets in Australia and has even found its way into the UK (Avery 2016).

Macro Environment Analysis 

Political Analysis

<Identify major political influences on the marketplace, if any. Use bullet points and make sure to reference your facts>

• Favourable government health policies which recognise and support the growth of the healthy living sector
• A stable government which enables businesses to thrive
• No protectionist policy which encourages the entrance of new players into the market (Aaker 2014).

<Identify major economic influences on the marketplace, if any. Use bullet points and make sure to reference your facts>

• Australia has one of the countries in the world with high GDP meaning that citizens have the disposable income to spend on health and wellness products
• The stable economy allows for the growth of businesses (Palmer 2012).
• Having a high GDP and a stable economy sustains a stable Australian currency which reduces risk to businesses which might result from currency fluctuations      
• Bilateral trade agreements between Australia and other countries boost economic development leading to high GDP with its attendant benefits to the business community (Russo & Confente 2018)

Social Analysis

<Identify major economic influences on the marketplace, if any. Use bullet points and make sure to reference your facts>

• Australians are some of the most health-conscious people in the world which encourages the growth of businesses engaged in health enhancing products (Australia 1989).
• Technological Analysis

<Identify major technological influences on the marketplace, if any. Use bullet points and make sure to reference your facts>

Technology affects the way a business communicates with the world, and it is one of the touchpoints with the consumers (Mcdaniel, Lamb, & Hair 2013).

• Communication technology advancement in Australia allows consumers to interact with the brand online thus increasing the product’s visibility.
• The Internet also enables consumers to order products from across the world increasing businesses revenue (Fleisher & Bensoussan 2015).
•  

Legal Analysis

<Identify major legal influences on the marketplace, if any. Use bullet points and make sure to reference your facts>

• The legal regime in Australia is conducive to entry and flourishing of businesses (Leeds Metropolitan University 2010).
• Micro Environment Analysis (Baines, Fill & Rosengren 2017)

Company Analysis

<What are three major positives regarding the company/brand. Use bullet points>

• The Coca-Cola company has strong brand recognition
• The company has a presence all over the content
• The company has the financial muscle necessary to enter the new business niche

<What are three major negatives regarding the company/brand >

• The Coca-Cola Company is known for producing sugary beverages which are considered harmful to health
• The company has various legal issues regarding false advertising and customers may be wary of its products
• The company sometimes uses unethical practices in its bid to get a foothold in the market

<One-two sentence summary of the company> The Coca-Cola Company is one of the biggest beverage companies in the world with presence in many countries across the globe.  The company specialises in the production of and distribution of soft drinks across the world, and it would be easy to incorporate healthy beverages like Kombucha in its ranks. Using its presence in the Australian market, the company would use its existent distribution network to reach the prospective consumers.

Competitor Analysis    (Armstrong 2019)

The market for Kombucha has grown in recent mainly because Australia is one of the most health-conscious cultures in the industrialised world (Evans, 2018). Due to the Australians’ obsession with all things health and wellness, the market for probiotics and healthy tea like Kombucha has expanded rapidly. The same love for a healthy living has contributed to the development of a complex and sophisticated health system with top of the range technology.

The first company to produce Kombucha commercially was MOJO followed closely by other companies selling their brands of the product. Kombucha Remedy is a household brand name in the Australian Kombucha market. It is a product by a couple, Emmet and Sarah, who ran into the product while fermenting their daily provisions and took it to the global market. From hawking one bottle a day to local health shops, the product is now sold in most of the major retail outlets in Australia and has even found its way into the UK.

The two companies, MOJO and Kombucha Remedy are current indirect competitors to the Coca-Cola Company beverage products, but once it decides to get in the Healthy beverage products niche, they will turn to be direct competitors.

Competitive market Summary

Consumer Analysis

The main consumers of Kombucha tea are the vegetarians and other health-conscious individuals. Kombucha tea is one of the health products touted to have many benefits to the consumers including treatment of some ailments and boosting the immune system. Other groups that consume the product are the older generation and people who are unwell. The old and the ailing use the tea as medication and for boosting their immune system. The young consumers mainly purchase the Kombucha tea both as natural remedies for their ailments or as stimulants. Most of the consumers browse the internet to search for the availability of the product and may also order for the products online. The older generation mainly purchases the tea through the various retail outlets such as Walmart (Boag 2008).

SWOT Analysis (Pickton, Masterson, & Kavanagh 2003).

What are the key recommendations you would make for this company or brand after analysing the market, competitors and consumer?  What are the key opportunities you have identified?

The Coca-Cola Company has various Strengths which it can leverage to have a firm foothold in the healthy beverage market in Australia. First, the company has a dormant market share in the beverage market. Out of the 600 billion consumed daily across the world, it supplies 3.2% of it. Secondly, the firm has a diversified Product portfolio and produces and distributes over 500 different products including drinking water, carbonated drinks, Tea and coffee and energy drinks. Third, it has the largest advertising budget in the beverage industry. In 2017.

the Coca-Cola Company spent USD 3.958 billion which was more than any other beverage company. Weaknesses. With all these strengths, the company can easily overcome its weaknesses including the fact that it depends on beverages alone which essentially means that it lacks in diversification. The one weakness that the company can struggle to overcome is the fact that it mainly produces sweet carbonated drinks and it is yet to find healthy alternatives. At the same time, the company is in a position to exploit the opportunities available to push its health beverages. Coca-Cola Company global presence and brand identity give it a good platform for introducing new products in its ranks. Also, the company is highly profitable allowing it to maintain its market share through advertising.

On balance, the Coca-Cola Company is well positioned to enter the healthy beverage industry in Australia either by producing its variety of Kombucha tea or partnering with the firms already producing the same in Australia. It would be advisable for the company to get into a business arrangement with an existing beverage company rather than producing its brand, which would be viewed with suspicion as the company is not known for producing healthy products.

Reference List

Aaker, D. A. (2014). Strategic market management. Hoboken, New Jersey : Wiley

Armstrong, G. (2019). Marketing: an introduction. Harlow, England ; New York : Pearson

Australia. (1989). Composition of foods, Australia. Canberra: Australian Government Pub. Service.

Avery, L. (2016). Living tea: healthy recipes for naturally probiotic kombucha. London : Ryland, Peters & Small.

Baines, P., Fill, C., & Rosengren, S. (2017). Marketing.   Oxford : Oxford University Press,

Boag, S. (2008). Personality down under: perspectives from Australia. New York, Nova Science Publishers. https://public.eblib.com/choice/publicfullrecord.aspx?p=3018290. 

Evans, F. (2018). Fermented probiotic drinks at home: make your own kombucha, kefir, ginger bug, jun, pineapple tepache, honey mead, beet kvass, and more. 

Fleisher, C. S., & Bensoussan, B. E. (2015)Business and competitive analysis: effective application of new and classic methods. Upper Saddle River, New Jersey: Pearson

Journey Australia Staff. (2017). One Small Idea: How Coca-Cola Became an Aussie Phenomenon. [Online] The Coca-Cola Company. 

Leeds Metropolitan University. (2010). PESTEL

Mcdaniel, C., Lamb, C. W., & Hair, J. F. (2013). Introduction to marketing. Australia, South-Western/Cengage Learning.

Palmer, A. (2012). Introduction to marketing: theory and practice. Oxford : Oxford University Press

Pendergrast, M. (2013). For God, country and Coca-Cola the definitive history of the great American soft drink and the company that makes it. New York, NY, Basic Books.

Pickton, D., Masterson, R., & Kavanagh, M. (2003). Introduction to marketing. Maidenhead, McGraw-Hill Education.

Russo, I., & Confente, I. (2018). Customer loyalty and supply chain management business-to-business customer loyalty analysis. New York: Routledge.

Schaefer, A. (2011). An introduction to business studies. Book 4,

Whitehead, R.J. (2018). Brands queue to enter Australia’s Kombucha crazy market but where are the globals? [Online] Food Navigator