[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

Coca-cola: description and history

Coca cola started out as a company whose principal aim was selling drinks, yet today it
means much more than that. The main business of coca-cola is the manufacturing,
distribution and selling of soft drinks. It is sold in restaurants, stores, and vending
machines. The Forbes magazine named in 2010 Coca Cola as one of the three most
valuable companies in the world, with a worth of 55.400 millions of dollars. Coca cola
has become the most popular company of drinks in the world, whose brands include a
much wider variety of drinks that extend throughout all the market and for all sectors.
Today, daily servings of Coca-Cola beverages are estimated at 1.9 billion globally. But
Coca Cola not only became a part of the costumer`s every day`s life as a drink, but
also as a way of life thanks to its advertising campaign, as one of its slogans in the UK
explains Live on the Coke Side of Life (2007).Open Happiness (2009). The brand has
become much more than what it was expected to be. Originally, coca-cola was invented
to be a patent medicine in the 19th century by John Pemberton, coca-cola has become
the dominant of the of the world soft-drink market in the 20th century. It is produced by
the coca-cola company, in Atlanta, Georgia. The company produces concentrate,
which is then sold to licensed Coca-Cola bottlers throughout the world. These bottlers
are wholesalers and hold territorially contracts with coca-cola company. The bottlers
sell, distribute and merchandise the coca-cola to retail stores, markets and
supermarkets, and vending machines.

Coca-cola is the biggest and most popular company of drinks of the world, whose
brand extends in the whole market as one of the most well known and most valuable
one and its brand is one of the most famous all over the world, if not the most. There
were some key points in the history of coca cola that has helped the brand become
what it is today.
Now we are going to explain the main points of the coca-cola history, attempting to
simplify how it becomes the biggest drink company in the world.
Coca-cola was created in 1886 by John Pemberton in the pharmacy Jacobs in the city
of Atlanta. Mixing leaves of different plants he created a medicine that started to be
marketed as a headache medicament and later sold as a thirst medicine. Frank
Robinson designed the logo with his own calligraphy, and put the name of Coca-cola.
When it became famous, Pemberton sold the recipe to some manufacturers in the
USA. The first attempt to put Coca Cola in a bottle was in 1894, after the growing
demand for the beverage and the customer`s need to make it portable, Joseph
Biedenharn, therefore, installed a bottling machineries rear of his Mississippi soda
fountain. Bottling was expanded only 5 years later after the rights of the brand were
bought by three enterprising businessmen in Chattanooga for just $1. Benjamin
Thomas, Joseph Whitehead and John Lupton developed what became the Coca-Cola
worldwide bottling system, setting its expansion all over the world.
In the early 1900s the coca cola company was rapidly spreading its headquarters in
places like Panama, Puerto Rico, Filipinas, and Guam, France and all over the United
States. In 1900 they had only 2 Bottling machineries, 20 years later there were more
than 1.000.

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

The first marketing efforts in Coca-Cola history were executed through coupons
promoting free samples of the beverage. Following the coupons, coca- cola started to
make advertisements in newspapers and distribute promotional items. Advertising
started to reflect a brand connected with fun, friends and good time, until become in the
advertisement style that it is nowadays.
We add a picture that shows how coca-cola has changed its logo which is its identity
sign, in the last century.

5 Porters Forces
As an analysis of the environment of coca-cola, we feel that doing a sum up of the
porters forces could help us towards understand the situation of the competence and
also the costumers of Coca-cola.
Michael Porter created a method of analysis of the environment of a company wich
includes: currently competitors, power of negotiation of costumers, power of negotiation
of suppliers, threat of new substitutes and potential competitors.

Currently Competitors of coca-cola

About this topic we can make a distinction between the competitors of coke. As a drink,
coca cola has to compete with other companies dedicated to drinks distribution as
water, juice or beer. Inside the market of cola drinks is where coca-cola has its biggest
competitor: pepsi.

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

Pepsi is another soft drink originally of USA created in 1893. PepsiCo has sales of
60.000 millions USD per year and 285.000 employees. Since the beginning, Pepsi has
become the hardest competitor for coca-cola because its similar product and its lower
prices.
The most important battle field in the coca-cola and pepsi competition is the marketing
point. In the last century coca-cola and pepsi have represented one of the most
aggressive publicity battles. They focused its effort in demonstrate that general public
prefers one than the order. However, while pepsi campaigns are more focused on
discredit its main competitor, Coca-cola gives a happiness message in its adverts,
always relating moments with friends or family with the fact of drink coke.

Power of costumers
As a general product, coca-cola must focus on satisfy the basic need of the general
public, the thirsty.
Coca-cola main costumers are retail stores, restaurants, and big supermarkets. We
shall make a distinction between those retailers.

Stores have no negotiation power because this segment is very fragmented.

Restaurants are also fragmented, but they have more negotiation power and
require lower prices because they buy big amounts.
Supermarkets are the most powerful costumers because their big size and also
due to the enormous amounts they order

Power of suppliers

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

Coca-cola suppliers are those companies whose own business is to provide the main
ingredients and spices necessary to do coke. These are sugar, caffeine and also the
packaging. As we can see, the necessary ingredients and the packaging are not too
difficult to produce; therefore coke has lots of possibilities to choose suppliers. That
means that suppliers do not have an important power of negotiation.

Threat of substitutes
Coca-cola has many substitutes products as bottled water, coffee, tea, juice. Therefore
coca needs to deal with a threat of substitutes due to people also are worried about
consuming healthier and cheaper drinks.

Threat of new competitors

The market of soft drinks is a very settle down market and it would be needed a huge
amount of capital to enter in this market. Despite the settle down market, exists a
loyalty from costumers to Coca-cola or Pepsi that increase the difficult of competes in
this market.
Strategy

Coca-Cola has three differents strategies:

Generic strategy: the generic strategy of Coca-Cola is differentiation,

becausethey try that customers can distinguish the quality of their products, the
constant innovation, and the great value of the mark for his career, also his
position in the minds of consumers and the image that supports the company
launches new products.

Other strategies: the Coca-Cola company still in the growth stage, given that
they are always launching new products to market, besides that is innovating
constantly, increasingly entering markets, obtaining a participation in markets
already present. Another strategy is diversification, throwing mineral water
(Dasani), energy drinks (Powered) and other refreshments (Kapo).

Fusion strategy: consist in one Company that joins other large company sector
for keeping their hegemony and their participation and stop the possible attacks
that may exist between the two companies.

Swot
Strenghts:
The most well-known brand worldwide.
The company has a great experience as it was founded in 1887 and it has
headquarters in many countries.
The products formula is secret, so it cannot be immitated.
Coke 's brand is so strong that it can influence in the concept of Santa Claus.

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

Coca-Cola knows the soft drinks market really well, they have plenty of
refreshments.
It is a brand that is always changing, since its foundation has changed the
slogan 50 times.
Coca-Cola has many distrubution channel as is worldwide present in many
events, especially sports.

Weakness
Coke price is usually higher than his competitors.
Coca-Cola usually have problems with their image because it looks associated
with USA

Opportunities
When there is a growth of the country and increases the GDP increases the
sales coke consumption.
If infation kept low and constant, allows a great stability for Coca-Cola
The use of internet, social networks and television is growing increasingly mor
so Cokes can use these to advertise for an easier and complete way.
Free publicity through people who speak well about Coke.

Threats
the only threat they could find would be juices or yogurt.
Or its major competitors like Pepsi.

Marketing Ps
Product

Coca Cola has a wide variety of products, such as Coca Cola Zero, Coca Cola Classic,
Diet Coke, and in different forms:
Can of 350 ml.
410 ml bottles.

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

1 liter bottles.
2 liter bottle.
3 liter bottle.
Variety of products, Coca Cola offers different options, such as the classic , the diet ,
the Zero , Vanilla Coke , Cherry Coke , which has a range of options just with respect
Coca Cola brand .The quality gives the strength in the market that have Coca Cola
products and its position in the consumer market.The design of the bottles and cans
Coca Cola is sexy and can always see all the Coca Cola logo with red background,
well known since its inception .Coca Cola has strong characteristics, but not only for his
unique flavor,
CokesBrand is presented all around the world and the customers choice because of
its unique flavor.Coca Cola havedifferent varieties of products and also have different
forms, such as six pack or four pack. Coca Cola dont have product delivery services,
but in some cases Coca Cola places their drinks in dispensers, which keeps good
temperature for human consume. Acquire a product of Coca-Cola does not guarantee
you but when you acquires these products because they know they are quality and that
gives guarantees for consuming.

Price
Coca Cola has a policy of been better than other drinks on the market, but the final
consumers agree to pay these prices to acquire one of these drinks. This is reflected in
the increase in sales for Coca Cola.
While the costs to purchase one of these products are high, having variety of
presentations, these prices vary according to the presentation.

Communication mix
Coca Cola 's products are distributed all aroud the world. Since its distribution channel
is through intermediaries, can see these products from a seller in the street to a
supermarket, which is a good distribution strategy by the managers of Coca Cola.Coca
Cola is positioned to customers as a product with good picture, thanks to the creative
commercials that raise the level of the product.

Promotion
The marketing campaign from Coca Cola is international, and gives interesting and
innovative commercials that stock in the head of the consumer and recived a well
message.
For the promotion of Coca Cola products, there are television advertising, magazines,
advertising panels, also Coca Cola have sponsors and some great events in the area
such as tournaments , parties, football teams , and Olympic Games ; which draws
more attention to consumers .
The Coca-Cola ads are always characterized by the controversy they cause. These
spots include some catchy music, a profound message or simply by its long duration.

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

Pest analysis

The Food and Drug Administration (FDA) regards non-alcoholic beverages such as
Coca-Cola as within the food category. The government regulates the manufacturing
procedure of these products. Companies that fail to meet the government's standards
are subject to fines. Coca-Cola is also subject to the Occupational Safety and Health
Act and to local, state, federal, and foreign environmental regulation. Following are
some of the factors that are influencing Coca-Cola's operations:
1. Changes in laws and regulationschanges in accounting standards, taxation
requirements (tax rate changes, modified tax law interpretations, entrance of new
tax laws), and environmental laws either in domestic or foreign authorities.
2. Changes in non-alcoholic business eracompetitive product and pricing policy
pressures and ability to maintain or earn share of sales in worldwide market
compared to rivals.
3. Political conditions, specifically in international marketscivil conflict,
governmental changes, and restrictions concerning the ability to relocate capital
across borders.
4. Ability to penetrate emerging and developing marketsthis also relies on
economic and political conditions, such as civil conflict and governmental
changes, as well as Coca-Cola's ability to form effectively strategic business
alliances with local bottlers, and to enhance their production amenities, distribution
networks, sales equipment, and technology.
Economic Analysis and Factors
During the recession of 2001, the US government took aggressive actions to turn the
economy around by 2002. Coca-Cola took note of this, and realized that loan interest
rates would likely rise as the economy returned. Thus, they took out low-cost loans in
2001 to fund growth in 2002. They used the loans for research and development on
new products to capitalize on in a strong 2002 economy. Currently, as global growth is
slowing, Coca-Cola may be watching for a similar opportunity.
Social Analysis and Factors
Social factors that affect the sales of Coca-Cola's products include the following:
1. The majority of people in the US are showing increasing interest in healthy
lifestyles. That has strongly influenced the sales within non-alcoholic beverage
sector as many customers switch to bottled water and diet colas such as CocaCola Light or Zero.
2. Time management is a concern for 43 percent of all households, a percentage
that has increased over the years.

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

3. Customers from ages 37 to 55 are concerned with their nutrition. Also, a large
portion of the population are baby boomers. As they become seniors, they are
more concerned about life choices that will impact their life expectancy. That will
continue to affect the non-alcoholic beverage sector by increasing the demand for
healthier drinks.
Technological Analysis and Factors
Some factors that cause a company's actual results to vary from expected results
include:
1. The efficiency of a company's advertising, marketing, and promotional
programsFor example, television, web, and social media advertising are
constantly evolving. The ability of a company to effectively promote their products
through these channels impacts sales.
2. Packaging designIn the past, the introduction of cans and plastic bottles
increased sales volume for the company due to how easy these containers were
to carry and dispose.
3. New equipmentBecause the technology is continuously advancing, new
equipment is constantly being introduced. Because of these new technologies,
Coca-Cola's production volume has increased sharply compared to that of a few
years ago.
4. New factoriesCoca-Cola Enterprises (CCE) has six factories in Britain that use
modern technology to ensure the quality and speedy delivery of product. In 1990,
CCE opened one of Europe's largest soft drinks factories in Wakefield, Yorkshire.
The factory has the ability to produce cans of Coca-Cola at a faster rate than a
machine gun can fire bullets.

The main customers

The cokes main customers are almost everyone, and they dont do a market
segmentation. The country that buy more cokes is Mexico.
Coca -Cola was born in the back room of a pharmacy 127 years ago.At the begining
only 9 bottles were sold daily.Today, Coca Cola ispresent in over 200 countries,
Burma has been the last addition. Every 24 hours the world consumed 1,600 million
Coca-Cola.
Currently, Coca -Cola Company has more than 500 brands.Coca-Cola Company has
71,000 employs and have produced and distributed over the past year about 3,000
products.For the first 13 years, Coca -Cola leads the ranking of the most valuable
brands in the world according to consultancy Interbrand, besides being the most
famous brand in the world. The known 94% of the world population. Product portfolio of

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

the company includes 12 other brands with a value of over 1,000 million.Including Diet
Coke, Fanta, Sprite, Coca-Cola Zero, vitamin water, Powerade, Minute Maid and
Georgia Coffee.Company owns four of the five major soft drink brands in the
world:Coca -Cola, Coca -Cola Light, Fanta and Sprite.

Targetin
Segmentation enables Brands to define the appropriate products for different kind of
customers. Coca Cola doesnt target a specific segment but adapt its marketing
strategy by developing new products.
Age: Generally, Coke does not have a specific target and is addressed to everyone.
But the main consumers are 12-30 years old people; even if there is no specific product
or communication for less than 12 or more than 30, the brand succeed in reaching
them, through partnerships for example (restaurants, fast foods such as
McDonalds), or thanks to its value among consumers. So, the core target audience
of Coca Cola is youngster or youth. Their targeting is not based on gender but the
results show that both genders like this product and use it (almost 50/50).

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

Finally, Coca Cola consider each customer as a target and a potential consumer. All
age groups are being targeted but the most potential is the age group from 18-25 that
covers around 40% of total age segments.
Life style: no life style targeted but more and more busy life style and mobile generation
(youth) are considered to be the most important part of Cokes consumers.
Occupation: no occupation targeted but consumers are mainly students and family
oriented people
Nature: fun, joy, entertainment loving
Customers Media Habits
There are some habits which are given as follow:

The young target audience of the brand loves media exposure

Mobile generation & social media is part of daily life

Connected people; they like innovations, they like being surprised.

Positioning
Coca Cola has strategically positioned itself within the world soft drink market. It faces
a vital question: does it have to keep the same positioning or to adapt according to the
200 countries where the brand sells its products. The brand has understood this
principle while ago: think global, act local. Cokes is thus willing to keep the same
core product which is coke, but it adapts the offer to local needs. They use strategic
positioning in order to have the same image all around the world, which is a success
because it is perceived today as a part of daily life everywhere. This perception of the
brand by the consumer leads to a high degree of loyalty and makes the purchasing
decision more automatic. Coca Cola has been successful by using Unique Selling
preposition as Live the coke side of life, related to joy and happiness.
Consumers basically associate this brand with these emotions. When the name of
Coke is mentioned, the first thing that comes into mind is fun and entertainment.

Mission
Refresh the world in body, mind and soul.
To inspire moments of optimism through our brands and actions, to create value and
live a mark in each of the places where we operate.
Values

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY

We have identified a set of core values that will help relight the flame of our business.
Some of these values are enduring, arise from our story, as we know them. Others,
however, will seem new to us. But they must all live in our hearts and in our minds and
be manifested in our actions.
We are actively planning and creating support mechanisms to ensure that our values
truly live.
Vision
Utilities: Maximizing return to shareholders, without losing sight of all our
responsibilities.
People: Being a great place to work, where our staff will be inspired to give their best.
Product Portfolio: Offer the world a portfolio of beverage brands that anticipate and
satisfy the desires and needs of individuals.
Partners: Building a successful network of partners and building mutual loyalty.
Planet: Being a comprehensive, responsible citizen that makes a contribution to a
better world.
Integrity: Be genuine.
Quality: What we do, we do well.
Responsibility: What happens depends on oneself.
Leadership: The courage to shape a better future .
Collaboration: Leverage collective talent.
Diversity: As inclusive as our brands.
Passion: Committed in heart and reason.

[FERNANDO PEA AND SANTIAGO VILLARRUBIA COCA-COLA COMPANY