29/04/2022
How Coca-Cola Became Successful.
Coca-Cola is the World’s most valuable soft drink brand. It is worth an estimated $74 billion: more than Budweiser, Pepsi, Starbucks, and Red Bull combined. It has a product portfolio of more than 3,500 beverages (and 500 brands)- which include sodas, water, coffee, teas, juices, kombuchas, etc. Its most popular brands are Coca-Cola, Sprite, Fanta, and Dasani. It’s present in more than 200 countries.
Coca-Cola uses a franchising model in its production and distribution. It produces concentrates and syrups, which are then distributed to the bottling partners around the world. The companies then combine the concentrates with sparkling water, and sweeteners, depending on the product, then package, sell and distribute to retailers. Nonetheless, the company owns 900 bottling plants and has 225 bottling partners worldwide.
Coca-Cola is entirely responsible for all consumer brand marketing initiatives.
Coca-Cola History
In the early 80s, although Coca-Cola was still the world’s best-selling soft drink, its rival Pepsi-Cola was gaining market share at a very fast speed, thanks in part to its aggressive “Pepsi Challenge” campaign. On April 23, 1985, Coca-cola took a very bold risk- the boldest single move in the history of the packaged-goods: It announced that it was changing the formula of the world’s most popular soft drink! It was called “new Coke.” The Company wanted to revamp the formula and the whole soft drinks segment, and they did just that!
Within weeks of the announcement, the company was fielding 5,000 angry phone calls a day. By June, that number grew to 8,000 calls a day. Angry consumers staged protests all over. Some even poured the contents of New Coke bottles into sewer drains. One Seattle consumer even filed suit against the company to force it to provide the old drink.
The outrage caught Company executives by surprise. They had hurriedly made a decision unsupported by data; They had underestimated loyal drinkers’ emotional attachments to the brand.
79 days after their initial announcement, the company executives once again held a press conference on July 11, 1985—this time to announce the return of the original formula, under the label Coca-Cola Classic. “Our boss is the consumer; we want them to know we’re very sorry.” Said the CEO. The news was so momentous that television networks broke into normal programming with special reports. As time passed by, the new coke was wiped out and the “old Coke” occupied the shelves. Big Lesson there.
Coke became the first soft drink to be consumed in outer space when astronauts aboard the Space Shuttle Challenger sipped from the Coca-Cola Space Can on July 12, 1985.
Coca-Cola Target Audience:
For your marketing campaign to bear fruits, it’s important to segment your market; divide it into logical groups, each of which might respond to a different approach. Creating an approach for each segment of your target audience will make it easy to pass a message.
Coca-Cola has segmented its market into:
1. Demographic.
Age is one of the most important segments of Coca-Cola.
Each of its products targets a certain age group. And the marketing campaigns are done with the target group in mind. For instance:
Coca-Cola- Targets a young customer base aged between 10-and 35. They often use well-known pop stars to promote their product. Also, the company targets universities, schools, Colleges, etc.
Coca-Cola diet Targets an elderly segment. It puts into consideration people with diabetes who are often 40 plus.
Gender
Coca-Cola light for example targets girls and women, whereas Coke Zero and Thums up have a stronger taste and target men.
All the marketing focuses on each group. Also from their branding, Coke Zero is in black and red and looks more masculine than Cola Light. The message in the advertising also differs.
2. Geographical Segmentation
The company sells its products in more than 200 countries. However, they pursue a different strategy depending on the region, because the needs of potential customers differ from each other due to climate, income, culture, or custom. Some products are available in other Countries but unavailable here, depending on customer needs. Ie Thums Up is available in India and China, but unavailable here.
Coca-Cola Positioning.
Coca-Cola does not sell a drink in a bottle, it sells happiness. In its marketing and advertising, they never talk about the ingredients or the content in their drinks. The company has positioned its products as thirst-quenching and refreshing. The products they offer are said to bring happiness and joy to its target market. The drinks and other products from Coca-Cola are also associated with having a great time with family and friends while enjoying daily life. All its marketing and advertising are based on that positioning. What comes to your mind when you hear the name Coca-Cola?
Me, happiness. I am already thirsty. Best brands don’t sell products/services. They sell emotions.
Coca-Cola pricing strategy.
From 1886 to 1959, a bottle of Coke cost just five cents.
Just like tech startups of today begin, by offering a service for free and then charging a higher price to consumers and/or advertisers once they've become hooked. Before utilizing networking effects became standard practice, Coca-Cola used a similar approach to scale across the US and then throughout the world.
It charges different prices for products depending on segment and market share.
Coca–Cola’s Marketing and advertising Strategies.
Coca-Cola spends more money on advertising than Microsoft and Apple combined
Coca-Cola’s advertising history dates back. The company has held many successful marketing campaigns from the 1971 hit song “I’d Like to Buy the World a Coke”, to the Share a Coke campaign of the modern-day, to countless commercials, campaigns, etc.
These are some marketing strategies it employs:
1. Sports sponsorship.
Coca-Cola has a long history of sports sponsorships. It was the first commercial sponsor of the Olympic Games, at the 1928 games in Amsterdam, and has been an Olympics sponsor ever since. Since 1978, Coca-Cola has sponsored the FIFA World Cup, and other competitions organized by FIFA.
2. In mass marketing.
The company has prominently featured in many films and television programs, such as “The Coca-Cola Kid”. In music, such as the song, "Come Together", the lyrics say, "He shoot Coca-Cola”, etc.
3. Acquisitions.
The Coca-Cola company has a long list and history of acquisitions. The first company Coca-Cola acquired was Minute Maid in 1960. In India, the company first took over Parle Foods and acquired local brands like Thumps Up, Limca, Mazaa, etc. The combination of Indian and Western brands enabled it to extend its global branding.
4. Great Marketing Campaigns.
Coca-cola is known for creating insanely great campaigns. Do you remember the “Share a Coke campaign?” Where Coke bottles had consumer names.
The campaign first launched in 2011 in Australia and New Zealand, using 250 of the most common millennial names to market its products to individual consumers. Through this campaign, the company encouraged its consumers to share a coke with a friend of that name. The aim was to create a more personal relationship with consumers and inspire shared moments of happiness. This campaign blew off on social media as everyone started to post pictures of it. The campaign soon spread to 70 countries and was successful everywhere. The campaign increased Coke consumption from 1.7 to 1.9 billion servings per day and made a number one global trending topic on social media.
5. Social Media.
Coca-Cola is known for creating insanely great social media campaigns.
It ran an organic social campaign during world Kindness Day 2019, called .
The brand partnered with artists on Instagram to create original Coke-inspired images, all responding to kindness. Share a Coke campaign, which involved Coca-Cola replacing the logo on the bottles of its Coke products with popular names, was also started on social media. The campaign was a social media success and within six months of its launch, Coca-Cola reported 330 million impressions on Twitter, with nearly 170,000 tweets from 160,000 fans.
6. Digital focus
Coca-Cola now has a digital infrastructure in place for accepting orders online or via a mobile app, using same-day delivery services. It is also using digital technology to create new consumer experiences via innovative programs like sip & scan, which lets consumers unlock experiences and prizes by scanning icons on Coke packages with their mobile phones.
