Using market research to

develop a
product range

A Coca-Cola Great Britain case

study

Ashish Kumar |
1504
Milan Gupta | 1514
Saurabh Kumar | 1518
Abhijeet Shinde | 1520
 Introduction
The Coca-Cola Company is the world's leading and best
known drinks supplier. Its mission statement is:
'The Coca-Cola Company exists to benefit and
refresh everyone who is touched by our business.

Company has a portfolio of products; a product range.

These products will be at different stages of their
product life-cycle; some will be newly launched, some
will be experiencing substantial growth, while others will
be holding on to their position in mature markets.
The aim ofCoca-Colais to ensure that its product range
offers something for every consumer at every occasion
at any time of day.

Coca-Cola GB carries out extensive market research to

 Soft drinks category
Non alcoholic drinks breakdown in GB by volume Soft drinks breakdown in GB by volume

Carbona
es
Soft
Squashes
drinks
3% / Cordials
24% 10% 2%
41% Tea Juice &
16% 48% Juice
32% drinks
Coffee 24%
Water
Milk &
Milk Sport
drinks enrgy
drinks

Coca-Cola GB operates in the non-alcoholic beverage

market.
In soft drinks alone, Coca-Cola GB has a broad range of
 Building the product range

A business can enlarge its product range in two ways:

Internally, through new product development

based on market research.
Externally, by acquiring related companies, and if
appropriate, building on their existing range.
 Continued
For example,
In 1999 The Coca-Cola Company purchased soft drinks
brands from Cadbury Schweppes plc, including Dr
Pepper, Oasis, KiaOra and Malvern .

The acquisition of Schweppes provided the opportunity

to complement the product range and to accelerate
growth through new product development.

Coca-Cola GB's approach to new product development

is uncomplicated. It innovates to meet consumer
demands; the consumer has a central role in the
research and development process.
 Organising around the consumer
Coca cola GB organisational
structure
Tech
Hum
Tech an
nica
reso
l
urce
Con
Busin sum Comm
ess er unicati
intelli on
Bran includi
gence
and
ds ng PR
plann Mar and
ing keti Consu
ng mer
care
Fina Le line
nce gal

This case study focuses on the activities of Coca-Cola GB, an

organisation focused solely on meeting consumers needs in
line with the Company's mission statement.
continued
At the centre of Coca Cola GB is its marketing department. Its
primary purpose is to Discover what consumers want and
ensure the organisation delivers this.

Placing marketing at the heart of the organisation enables

Coca-Cola GB to grow the product range in ways that best
meet consumer requirements through developing:

New drink categories

e.g. sports drinks
New products within an existing category
e.g. Winnie the Pooh Roo Juice
New variants of existing products (brand line extensions/pack
innovations)
e.g. Fanta Icy Lemon.
 Category segmentation

By dividing a category into segments, businesses

can identify different groups of consumer wants.
It is then possible to design products to meet
those requirements.
 Each segment within the overall range of Coca-Cola meets
specific consumer wants. Coca-Cola GB carries out
extensive market research to identify consumer wants in
every segment of category in which it operates.
For example, market research analysis of the demographics
of consumers in Great Britain revealed a growth in smaller
households. The appropriate product response was to
produce 1.25 litre share-size bottles.

A study of occasions when people drink sports drinks

showed the importance of making it available in leisure
centres. Other research showed that the famous original
Coca-Cola glass bottle is best targeted at restaurants and
special party occasions.

Market research into where specific products are consumed

influences the design of pack types e.g. a 2 litre bottle for
 Market research
Market research means systematically gathering, recording
and analysing market data. Primary research involves going
'into the field' (e.g. house-to-house or street surveys).
Secondary research involves using existing sources of
information to research the market such as published reports
or articles, or searching the Internet.
There are two main approaches to 'primary' market research:
Quantitative research: collecting information from a
broad population sample e.g. by conducting extensive
surveys, used when Coca Cola GB wants to gauge appeal
across a wide audience

Qualitative research: working with small 'focus' groups.

This involves far more detailed investigations, e.g.
gathering a small group of 'typical' consumers to taste test
products or to talk about their preferences and experiences
of using different products. Qualitative research, whilst not
 Cont
Coca-Cola GB's research process has five stages:
1. Identify opportunity
Does it fit into an existing or new product category?
Who are the target consumers? What do they want?
Method: Desk research/secondary research.

2. Explore solution
What is the best solution?
a new product?
a product extension?
a new packaging concept?
a new design?
Method: Qualitative research using focus groups and
in-depth interviews one-to one.
 Cont
3. Measure suitability/effectiveness
Evaluate the relative appeal of alternative solutions in terms
of meeting consumer requirements.

Method: Quantitative research through face-to-face,

telephone/internet interviews

4. Test Market
As it is very expensive for a company to launch a new
product, before going for a full market launch it often pays to
try out new product ideas in a 'test' market. This may be
launching the product in just one region of Great Britain, with
just one retailer or conducting a 'Simulated Test Market'.

Method: Quantitative research from participants in a test

sample of consumers who physically live with the test product
 Cont
There are three stages:
1. concept research - to determine whether consumers like
the 'concept' of the new product
2. product attributes - to determine whether the actual
'product' offering matches the 'concept'
3. volume assessment - to determine whether consumers
will actually buy the new product and what, if any, existing
products it will replace.

5. Track market performance

This involves tracking the product's success once it has
been launched e.g. by recording sales figures, numbers of
people familiar with the product, etc.
Method: Quantified continuous rolling study with
consumers and/or analysis of Electronic Point of Sale data
(sales information gathered via retailers' tills).
 Product development
Ansoff's matrix is a useful tool for examining a company's product range.
This compares the alternatives of developing new products and new
markets. There are four main options:
1. Market penetration: selling more of the same types of product to the
same types of people.
2. Product development: building on existing relationships with consumers
and on a creative ability to develop new products suited to consumer
wants.
3. Market development: developing an existing product to cater for
emerging markets.
4. Diversification: developing new products for new markets.
 Developing the range
1. Coca-Cola Vanilla: had a successful launch in the USA So
it was decided to test its potential in Great Britain.

2. Fanta Icy Lemon: Development of this new flavour

stemmed from listening directly to consumers who called the
Company's care line to enquire about the availability of a lemon
Fanta based on their experience on holidays abroad

3. Coca-Cola Share Size 1.25 litre Bottle: Growth in the

number of smaller households & a change in the way we shop.
The research identified a need for a bottle size that was ideal for
top-up shoppers or 1-2 person households to share over dinner.

4. PowerAde: Desk research identified an opportunity for a

new brand within the sports drink segment. Research was used
to identify target consumers and desirable product positioning.
 Launch evaluation
For any new product launch, Coca-Cola GB evaluates its
success, looking specifically at the various elements of
the launch activity, including distribution, advertising,
packaging and product taste.

Data is collected from leading marketing research

organisations, the company's consumer care line, Coca-
Cola bottlers, and a consumer tracker report that
measures consumers' brand awareness.
Conclusion
Coca-Cola GB seeks to develop intelligently its
product range in order to 'benefit and refresh
everyone'.

Building the range involves developing existing and

new products in existing and new markets.

The key to maximising consumer satisfaction lies in

doing the market research properly and getting the
range right.