Executive summary

Giant soft drink company Coca Cola has come under intense scrutiny by investors due to
its inability to effectively carry out its marketing program. Consequently it is seeking the
help of Polianitis Marketing Company Pty Ltd to develop a professional marketing plan
which will help the business achieve its objectives more effectively and efficiently, and
inevitably regain there iron fist reign on the soft drink industry.
When establishing a re-birthed marketing plan every aspect of the marketing plan must
be critically examined and thoroughly researched. This consists of examining market
research, auditing business and current situation (situation analysis) and carefully
scrutinizing the soft drink industry and possibilities for Coca Cola in the market. Once
Coca Cola have carefully analyzed the internal and external business environment and
critically examined the industry in general the most suitable marketing strategies will be
selected and these strategies will be administered by effectively and continually
monitoring external threats and opportunities and revising internal efficiency procedures.

Situation Analysis on Coca Cola

Market Analysis The market analysis investigates both the internal and external business environment. It is
vital that Coca cola carefully monitor both the internal and external aspects regarding its
business as both the internal and external environment and their respective influences will
be decisive traits in relation to Cokes success and survival in the soft drink industry.
Internal Business Environment
The internal business environment and its influence is that which is to some extent within
the businesss control. The main attributes in the internal environment include efficiency
in the production process, through management skills and effective communication
channels. To effectively control and monitor the internal business environment, Coke
must conduct continual appraisals of the businesss operations and readily act upon any
factors, which cause inefficiencies in any phase of the production and consumer process.
External Business Environment
The External business environment and its influences are usually powerful forces that can
affect a whole industry and, in fact, a whole economy. Changes in the external
environment will create opportunities or threats in the market place Coca cola must be
aware off. Fluctuations in the economy, changing customer attitudes and values, and
demographic patterns heavily influence the success of Coca Colas products on the
market and the reception they receive from the consumers.
SWOT Analysis -

SWOT stands for Strengths Weakness Opportunities Threats. SWOT analysis is a

technique much used in much general management as well as marketing scenarios.
SWOT consists of examining the current activities of the organization- its Strengths and
Weakness- and then using this and external research data to set out the Opportunities and
Threats that exist.
Strengths
Coca-Cola has been a complex part of world culture for a very long time. The products
image is loaded with over-romanticizing, and this is an image many people have taken
deeply to heart. The Coca-Cola image is displayed on T-shirts, hats, and collectible
memorabilia. This extremely recognizable branding is one of Coca-Colas greatest
strengths. Enjoyed more than 685 million times a day around the world Coca-Cola
stands as a simple, yet powerful symbol of quality and enjoyment (Allen, 1995).
Additionally, Coca-Colas bottling system is one of their greatest strengths. It allows
them to conduct business on a global scale while at the same time maintain a local
approach. The bottling companies are locally owned and operated by independent
business people who are authorized to sell products of the Coca-Cola Company. Because
Coke does not have outright ownership of its bottling network, its main source of revenue
is the sale of concentrate to its bottlers.
Weaknesses
Weaknesses for any business need to be both minimized and monitored in order to
effectively achieve productivity and efficiency in their businesss activities, Coke is no
exception. Although domestic business as well as many international markets are thriving
(volumes in Latin America were up 12%), Coca-Cola has recently reported some
declines in unit case volumes in Indonesia and Thailand due to reduced consumer
purchasing power. According to an article in Fortune magazine, In Japan, unit case
sales fell 3% in the second quarter [of 1998]scary because while Japan generates
around 5% of worldwide volume, it contributes three times as much to profits. Latin
America, Southeast Asia, and Japan account for about 35% of Cokes volume and none of
these
markets
are
performing
to
expectation.
Coca-Cola on the other side has effects on the teeth which is an issue for health care. It
also has got sugar by which continuous drinking of Coca-Cola may cause health
problems. Being addicted to Coca-Cola also is a health problem, because drinking of
Coca-Cola daily has an effect on your body after few years.
Opportunities
Brand recognition is the significant factor affecting Cokes competitive position. CocaColas brand name is known well throughout 94% of the world today. The primary
concern over the past few years has been to get this name brand to be even better known.

Packaging changes have also affected sales and industry positioning, but in general, the
public has tended not to be affected by new products. Coca-Colas bottling system also
allows the company to take advantage of infinite growth opportunities around the world.
This strategy gives Coke the opportunity to service a large geographic, diverse area.
Threats
Currently, the threat of new viable competitors in the carbonated soft drink industry is not
very substantial. The threat of substitutes, however, is a very real threat. The soft drink
industry is very strong, but consumers are not necessarily married to it. Possible
substitutes that continuously put pressure on both Pepsi and Coke include tea, coffee,
juices, milk, and hot chocolate. Even though Coca-Cola and Pepsi control nearly 40% of
the entire beverage market, the changing health-consciousness of the market could have a
serious affect. Of course, both Coke and Pepsi have already diversified into these
markets, allowing them to have further significant market shares and offset any losses
incurred due to fluctuations in the market. Consumer buying power also represents a key
threat in the industry. The rivalry between Pepsi and Coke has produce a very slow
moving industry in which management must continuously respond to the changing
attitudes and demands of their consumers or face losing market share to the competition.
Furthermore, consumers can easily switch to other beverages with little cost or
consequence.
Product Life cycle

When referring to each and every product or service ever placed before the consumer i.e.
in the long term all the existing products and services are dead. For e.g.:- Replacement of
Ford Cortina ( a highly successful car) by Ford Sierra, the replacement of sierra by the
Ford Mondeo and the replacement of the old Mondeo by the new Mondeo in 2001. So
every product is born, grows, matures and dies. So in the commercial market place
products and services are created, launched and withdrawn in a process known as Product
Life Cycle.
To be able to market its product properly, a business must be aware of the product life
cycle of its product. The standard product life cycle tends to have five phases:
Development, Introduction, Growth, Maturity and Decline. Coca-Cola is currently in the
maturity stage, which is evidenced primarily by the fact that they have a large, loyal
group of stable customers.
Furthermore, cost management, product differentiation and marketing have become more
important as growth slows and market share becomes the key determinant of profitability.
In foreign markets the product life cycle is in more of a growth trend Cokes advantage in

this area is mainly due to its establishment strong branding and it is now able to use this
area of stable profitability to subsidize the domestic Cola Wars.
Marketing Objectives
The objective is the starting point of the marketing plan. Objectives should seek to
answer the question Where do we want to go? The purposes of objectives include -> To enable a company to control its marketing plan.
-> To help to motivate individuals and teams to reach a common goal.
-> To provide an agreed, consistent focus for all functions of an organization.
All objectives should be SMART i.e. Specific, Measurable, Achievable, Realistic, and
Timed.
Specific Be precise about what you are going to achieve
Measurable Quantify you objectives
Achievable Are you attempting too much?
Realistic Do you have the resource to make the objective happen (men, money,
machines, materials, and minutes)?
Timed State when you will achieve the objective.
Selecting Target Market
Once the situation analysis is complete, and the marketing objectives determined,
attention turns to the target market. The soft drink market is very large, and the business
cannot be all things to all people, so it must choose which market segments have the
greatest potential. The target market is the group of customers on whom the business
focuses attention. The target market is where Coca Cola focuses its marketing efforts as it
feels this is where it will be most productive and successful. The target market for Coca
cola is very wide as it satisfies the needs for many different consumers, ranging from the
healthy diet consciousness through Diet Coke to the average human through its best
selling drink regular Coke. Most Coke products satisfy all age groups as it is proven that
most people of different age groups consume the Coca Cola product. This market is
relatively large and is open to both genders, thereby allowing greater product
diversification.
There are four broad ways which Coca Cola can segment its market
-> Mass marketing
-> concentrated marketing

-> Differentiated marketing

-> Niche marketing
The most apparent method used by Coca Cola is with no doubt the differentiated
marketing method as Coke satisfies a range of different markets. Diet coke satisfies the
weight consciousness, regular coke, sprite, fanta the average human, coffee, iced tea etc.
Each group of beverages satisfies a particular group of people but majority the average
human.
Developing the marketing Mix The marketing mix is probably the most crucial stage of the marketing planning process.
This is where the marketing tactics for each product are determined. The marketing mix
refers to the combination of the four factors (price, promotion, product, and place) that
make up the core of a businesss marketing strategy. In this step of the marketing
planning process, marketing mix must be designed to satisfy the wants of target markets
and achieve the marketing objectives. The most successful businesses have continually
monitored and changed their marketing mix due to respective internal and external
factors and have monitored the external business environment in order to maximize their
marketing mix components.
Product:
Many Products are physical objects that you can own and take home. But the word
product means much more than just physical goods. In marketing, product also refers to
services, such as holidays or a movie, where you enjoy the benefits without owning the
result of the service.
Businesses must think about products on three different levels, which are the core
product, the actual product and the augmented product. The core product is what the
consumer is actually buying and the benefits it gives. Coca Cola customers are buying a
wide range of soft drinks. The actual product is the parts and features, which deliver the
core product. Consumers will buy the coke product because of the high standards and
high quality of the Coca Cola products. The augmented product is the extra consumer
benefits and services provided to customers. Since soft drinks are a consumable good, the
augmented level is very limited. But Coca Cola do offer a help line and complaint phone
service for customers who are not satisfied with the product or wish to give feedback on
the products.
Positioning

Once a business has decided which segments of the market it will compete in, developed
a clear picture of its target market and defined its product, the positioning strategy can be
developed. Positioning is the process of creating, the image the product holds in the mind
of consumers, relative to competing products. Coca Cola and Franklins both make soft
drinks; although Franklins may try to compete they will still be seen as down market
from Coca Cola. Positioning helps customers understand what is unique about the
products when compared with the competition. Coca Cola plan to further create positions
that will give their products the greatest advantage in their target markets. Coca Cola has
been positioned based on the process of positioning by direct comparison and have
positioned their products to benefit their target market. Most people create an image of a
product by comparing it to another product, thus evident through the famous battles
between Coca-Cola and Pepsi products.
Branding
It is often hard to say exactly why we buy one companys product over another.
Companies such as Nike and Adidas spend large amounts of money trying to win
consumers away from their competitors who make products that are very similar. The
popularity of the brand is often the deciding factor. Over the time Coca Cola has spent
millions of dollars developing and promoting their brand name, resulting in world wide
recognition. Coca-Cola is the most recognized trademark, recognized by 94% of the
worlds population and is the most widely recognized word after OK. Coca Colas red
and white colors and special writing are all examples of world-wide trademarks.
There are a number of branding strategies: Generic brand strategy, Individual brand
strategy, Family brand strategy, Manufacturers brand strategy, Private brand strategy and
Hybrid brand strategy. Coca Cola utilizes the Individual brand strategy as Coca Colas
major products are given their own brand names e.g. Fanta, Sprite, Coca Cola etc
although they maybe presented as different lines they operate under the name of Coca
Cola.
Packaging
Packaging, which is not as highly perceived by businesses, is still an important factor to
examine in the marketing mix. Packaging protects the product during transportation,
while it sits in the shelf and during use by consumers; it promotes the product and
distinguishes it from the competition. Packaging can allow the business to design
promotional schemes, which can generate extra revenue and advertisements. Coca-Cola
has benefited from packaging the product with incentives and endorsements on the
labeling as a promotional strategy to increase its volume of sales and revenue.
Price:

Price is a very important part of the marketing mix as it can affect both the supply and
demand for Coca Cola. The price of Coca Colas products is one of the most important
factors in a customers decision to buy. Price will often be the difference that will push a
customer to buy our product over another, as long as most things are fairly similar. For
this reason pricing policies need to be designed with consumers and external influences
in mind, in order to effectively achieve a stable balance between sales and covering the
production costs.
Price strategies are important to Coca Cola because the price determines the amount of
sales and profit per unit sold. Businesses have to set a price that is attractive to their
customers and provides the business with a good level of profit. Long before a sale was
ever made Coca Cola had developed a forecast of consumer demand at different prices
which inevitably determined whether or not the product came on the market, as well as
the allocation of adequate money and resources to produce promote and distribute the
product.

Pricing Strategies And Tactics

The pricing Strategy a business will use will have to focus on achieving the marketing
plans objectives and support the positioning of the product, and take external factors
such as economic conditions and competitors in to account. There are 5 strategies
available to business: Market skimming pricing, Penetration pricing, Loss leaders, Price
Points and Discounts. Over the years Coca Cola has used Penetration Pricing as a way of
grabbing a foothold in the market and won a market share. Its product penetrated the
marketplace. Once customer loyalty is established as seen with Coca Cola it is then able
to slowly raise the price of its product. There has been a fierce pricing rivalry between
Coca Cola and Pepsi products as each company competes for customer recognition and
satisfaction. Till now it appears as if Coke has come up on top, although in order to gain
long term profits Coke had to sacrifice short term profits where in some cases it either
went under of just broke even, but as seen it has been all for the best.
Pricing Methods
Good pricing decisions are based on an analysis of what target customers expect to pay,
and what they perceive as good quality. If the price is too high, consumers will spend
their money on other goods and services. If the price is too low, the firm can lose money
and go out of business.
Pricing methods include: Cost based Pricing, Market based pricing and Competition

based Pricing. Over the years Coca has lost ground here in its pricing but has regained its
strength as it employed the Competition-based pricing method which allowed it to
compete more effectively in the soft drink market. Leader follower pricing occurs when
there is one quite powerful business in the market which is thought to be the market
leader. The business will tend to have a larger market share, loyal customers and some
technological edge, thus the case currently with Coke; it was first the follower but
through effective management has now become the leader of the market and is working
towards achieving the marketing objectives of the Coca Cola. Survival in the market
place, own 60 % of market share by 2007, increase further awareness of product and a
return on 20% on capital employed for August 2007.
Promotion:
In todays competitive environment, having the right product at the right place in the right
place at the right time may still not be enough to be successful. Effective communication
with the target market is essential for the success of the product and business. Promotion
is the p of the marketing mix designed to inform the marketplace about who you are, how
good your product is and where they can buy it. Promotion is also used to persuade the
customers to try a new product, or buy more of an old product.
The promotional mix is the combination of personal selling, advertising, sales promotion
and public relations that it uses in its marketing plan. Above the line promotions refers to
mainstream media: Advertising through common media such as television, radio,
transport, and billboards and in newspapers and magazines. Because most of the target is
most likely to be exposed to media such as television, radio and magazines, Coca Cola
has used this as the main form of promotion for extensive range of products. Although
advertising is usually very expensive, it is the most effective way of reminding and
exposing potential customers to Coca Cola Products. Coca Cola also utilizes below the
line promotions such as contests, coupons, and free samples. These activities are an
effective way of getting people to give your product a go.
Place and Distribution:
The place P of the marketing mix refers to distribution of the product- the ways of getting
the product to the market. The distribution of products starts with the producer and ends
with the consumer.
One key element of the Place/Distribution aspect is the respective distribution channels
that Coca Cola has elected to transport and sells its product.
Selecting the most appropriate distribution channel is important, as the choice will
determine sales levels and costs. The choice for a distribution channel for any business
depends on numerous factors, these include

 How far away the customers are;

The type of product being transported;
The lead times required; and;
The costs associated with transport;
There are four types of distribution strategies that Coca Cola could have chosen from,
these are: intensive, selective, exclusive and direct distribution. It is apparent from the
popularity of the Coca Colas product on the market that the business in the past used the
method of intensive distribution as the product is available at every possible outlet. From
supermarkets to service stations to your local corner shop, anywhere you go you will find
the Coca Cola products.
Physical Distribution Issues
Coca Cola needs to consider a number of issues relating to the physical distribution of its
soft drink products. The five components of physical distribution are, order processing,
warehousing, materials handling, inventory control, transportation. Coca Cola must
further try to balance their operations with more efficient distribution channels.
Order Processing- Coca Cola cannot delay their processes for consumer deliveries (i.e.
delivery to selling centers), as this is inefficient business functioning and is portrays a
flawed image of the product and overall business.
Warehousing and inventory control- warehousing of Coca Cola products is necessary.
Inventory control is another important aspect of distribution as inventory makes up a
large percentage of businesses assets. Choosing the correct and desired inventory
measure that Jacksons sees as most effective is vital. Jacksons must remember though
that there are factors involved with inventory control that can hinder the products sales
and customer perceptions (hazards, distribution from storage facilities, etc).
Materials handling- this deals with physically handling the product and using machinery
such as forklifts and conveyor belts. When holding products, then Coca Cola has
benefited from purchasing or renting respective machinery.
Transportation- transporting Coca Cola products is the one most important components of
physical distribution. Electing either to transport the sports drink by air, rail, road or
water depends on the market and depends on the associated costs. The most beneficial
transportation method for Coca Cola would be ROAD if the product were moved around
from storage to the cost centers.

Implementing, Monitoring and Controlling

Financial Forecasts
Financial forecasts are predictions of future events relating strictly to expected costs and
revenue costs for future years. There are five major marketing expenditures, which
include research costs, product development costs, product costs, promotion costs and
distribution costs.
Sales force composite is the most logical method in forecasting revenue. This involves
estimates from individual salespeople to sell to work out a total for the whole business.
Once these costs and revenues are forecasted, management can then decide which
combination of marketing mix strategies will deliver the most sales revenue at the lowest
cost.
Implementing
Implementation is the process of turning plans into actions, and involves all the activities
that put the marketing plan to work. Successful implementation depends on how well the
business blends its people, organizational structure and company culture into a cohesive
program that supports the marketing plan.
For its further success, Coca Cola must impose several key changes. Production needs to
be on time and meet the quota demanded from wholesalers. It must also be efficient so as
not to build inventory stocks and inventory prices. The marketing needs to be motivated
and knowledgeable about the product. The forms of promotion such as advertising must
be attracting and enticing to the target market to get the greatest amount of exposure
possible for the product. This will ensure the success of the product in the stores.
Distribution of the product must be efficient. This problem has already been taken care of
with convenient transport routes to commercial areas and transport already being
arranged.
Monitoring And Controlling
Monitoring and controlling allows the business to check for variance in the budget and
actual. This is important because it allows Coca Cola to take the necessary actions to
meet the marketing objectives. There are three tools Coca Cola should use to monitor the
marketing plan. They are the following:
Sales Analysis
The sales analysis breaks down total business sales by market segments to identify
strengths and weaknesses in the different areas of sales. Sellers of Coca Cola products

vary from major retail supermarkets to small corner stores. This gives its products
maximum exposure to customers at their convenience.
Market Share Analysis
Market share analysis compares Coca Colas business sales performance with that of its
competitors. Coca Cola looks to increase its market share by over 60%. With the changes
Coca Cola is currently undergoing, they aim to regain an iron fist control of the market.
Target market various age groups and lifestyles from high school students too
universities, and male or female.
Marketing Profitability Analysis
This analysis looks at the cost side of marketing and the profitability of products, sales
territories, market segments and sales people. There are three ratios to monitor marketing
profitability; they are market research to sales, advertising to sales and sales
representatives to sales. The results of these three tools can help Coca Cola determine any
emerging trends, such as the need for a different product. Comparing these results with
actual results gives the business an idea on when to change.
Market Research
When attempting to implement a new Marketing plan a business must address its target
market and conduct the relevant information to insure the new marketing plan both
differs from the old and is better for the business. When conducting market research a
business must first define the problem and then gather the appropriate information to
solve the problem. There are 3 types of information a business can gather to solve its
problems.
->Exploratory Research which clarifies the problem and searches for ways to address it.
->Descriptive Research is used to measure and describe things like the market potential
for a product and characteristics of the target market.
->Casual Research is used to test a hypothesis about a cause and effect relationship.
Coca Cola through its market research has addressed all three types of research to define
the problem raised by shareholders and gathered information to serve their needs.
Factors Influencing Consumer Choice -

When making decisions on products a business must look at factors that influence
consumer choice such as psychological factors, Socio cultural factors, Economic factors
and Government Factors.
Psychological Factors: such as motivation, perception, lifestyle, personality and self
concept, learning, and attitudes influence the consumers behavior towards a product and
Coca Cola has addressed this issue by introducing Diet Coke to satisfy different
lifestyles.
Socio cultural factors: such as culture, subculture, socio-economic status, family and
reference groups influence the consumers behavior towards a product.
Economic factors: such as Disposable income and discretionary income. Coca Cola has
addressed this side of the influence by maintaining a low price on the price of its
products.
Government Factors: such as new regulations, inflation, interest rates all influence
consumer spending and choice.