Executive Summary
The Coca-Cola Company is a global leader in the non-alcoholic beverages market, with a stable and high level of sales. To support the high level of interest in its products, the company constantly launches new products that may be attractive to clients. Coca-Cola is ready to introduce new flavors to the market.
Coca-Cola with Coffee Mocha is a new product expected to help the brand compete with other brands in the same market, as it combines unique tastes that are attractive to consumers. The company targets the segment of loyal clients interested in the brand’s products and new consumers whose taste in coffee might be a good fit. The desired level of sales is expected to be attained during the first year.
Situation Analysis
Coca-Cola is a leading company in the global non-alcoholic beverages market. The brand sells its products in around 200 countries worldwide and has a broad target audience. In 2020, the company generated $38.7 billion in revenues, indicating its strong market position. The company offers approximately 79,000 jobs in various regions. However, the non-alcoholic beverages market is highly competitive, meaning the brand must continue to evolve and offer new products to maintain high customer interest and broaden its target audience. For this reason, launching new products is crucial in the current industry landscape.
Market Summary
The target market for the Coca-Cola Company consists of clients who value non-alcoholic drinks and the diversity of flavors. Thus, Figure 1 shows the types of beverages that are attractive to clients:
Coca-Cola focuses on producing all these types to ensure that clients remain satisfied. At the same time, the statistics show that the market share of coffee and tea continues to grow, indicating that individuals are increasingly interested in purchasing this category of drinks. For this reason, to meet the growing demand for new types of beverages, the Coca-Cola Company has introduced a new product that combines several flavors and types. However, other companies operating within the industry, such as PepsiCo, Nestlé, or Danone, also focus on offering similar products. It means that the current market is characterized by an increased focus on adding products with new flavors to existing offerings to meet clients’ requirements for diversity.
SWOT Analysis
The Coca-Cola Company has specific strengths that might help the brand succeed in launching a new product and competing with its major rivals. At the same time, several weaknesses should be considered while designing the market strategy.
Strengths
First, the corporation has a unique brand identity and awareness, making it recognizable to clients and part of modern pop culture. Second, the Coca-Cola Company has a high brand value ($57 billion), which helps it invest in new projects and compete with major rivals. Third, the brand continually expands its global presence and enters new regions, creating new opportunities for generating additional revenue. Fourth, the company has a robust and well-developed distribution system, supported by reliable suppliers and retailers. Ultimately, it has a loyal customer base worldwide. It is helpful to expect high sales during the initial phases of a new product’s launch.
Weaknesses
Thus, the Coca-Cola Company has specific weaknesses that should be taken into consideration. First, the company lacks diversity in its offerings, which explains the desire to launch a new product. Consumers appreciate the existing beverages but might need new ones to remain loyal.
Second, the company faces challenges from its closest rivals, as they focus on the same market segments and introduce similar products. Finally, the brand lacks experience in creating coffee-flavored products, which might explain the difficulties with entering the market and becoming attractive to clients. These challenges might impact the outcome of the incentive.
Opportunities
The attempt to diversify offerings by launching a new product provides Coca-Cola with new opportunities. First, the brand can expand its target audience by attracting individuals who value coffee. Second, it can impact the market’s development and introduce a new trend that will be leveraged by the brand, making its position advantageous for its closest rivals. Third, the diversification and success of a new product might help the brand introduce a new pricing strategy and offer its products at lower costs than competitors. These opportunities are crucial for the successful development of Coca-Cola and the maintenance of its leading position in the non-alcoholic beverage market.
Threats
The company also faces several major threats that should be taken into consideration when launching a new product. Firstly, the high level of rivalry characteristic of the industry is a factor that may impact the company’s future development. Second, recent research indicates that individuals are reconsidering their drinking habits and opting for healthier alternatives, such as water, over carbonated beverages. It might have adverse effects on Coca-Cola sales and prospects in the future. Moreover, the rise of environmental issues necessitates that the brand reassess its approach to sustainability and waste management. These factors are crucial for planning the corporation’s future development and long-term survival.
Competition
The level of competition in the non-alcoholic beverage market is high due to its attractiveness to companies and the opportunity to generate high income. There is also a risk of a new entry, meaning that smaller or local companies might introduce their products to attract clients. At the same time, the Coca-Cola Company has several major rivals that should be taken into consideration when planning a new launch. PepsiCo, NestléNestlé, Unilever, Dr. Pepper Snapple Group, and Arizona Beverage Company.
The competition is complicated because all companies offer similar products to attract a loyal audience. For instance, Coca-Cola, Pepsi, Sprite, and 7Up are similar to clients. It highlights the need to create new, unique flavors and maintain an elevated level of client interest. It also explains the relevance and topicality of launching and introducing a new product.
Product Offerings
The Coca-Cola Company offers a range of products with distinct features. The four major categories include carbonated soft drinks, water and tea, juices and fruit-flavored milk, and sports and energy drinks. Diverse tastes and flavors, along with the use of high-quality and safe components, characterize the products.
Additionally, Coca-Cola focuses on launching a new line of coffee-flavored drinks, which is expected to diversify its current offerings. The new product is expected to achieve high sales and contribute to the continued growth and development of the brand. For this reason, the new offering is supported by substantial resources to create the background for its further popularization and entry into new markets.
Distribution
As stated, the company has a practical and aligned distribution system, helping it compete with its closest rivals. The Coca-Cola Company operates in six major regions: North America, Latin America, Africa, Europe, the Pacific, and Eurasia. The brand’s bottling partners are responsible for manufacturing and shipping the product.
Moreover, the Coca-Cola Export Corporation collaborates with regional bottlers worldwide to distribute beverages to local markets. Numerous retailers might cooperate with the brand to ensure it generates a high income. For this reason, launching a new product, the company can support the incentive by using the numerous distribution channels available to it at the moment.
Marketing Strategy
The marketing strategy can be defined as a set of activities aimed at reaching the target audience, promoting a specific product, and ensuring a high level of sales for it. Previously, Coca-Cola’s marketing strategies contributed to the brand’s success, as evidenced by its high sales and income levels. The brand uses social media and online communication channels to create awareness about a new product, attract attention, and ensure that individuals will be interested in its acquisition during the first stages. Additionally, the brand focuses on collecting feedback to introduce changes when necessary or to create new offerings. The marketing strategy should also be supported with clear goals and objectives.
Objectives
Launching a new project, the Coca-Cola Company sets ambitious and attainable goals to ensure employees remain motivated and the brand continues to evolve. Thus, short-term goals for Coca-Cola Coffee Mocha include creating a recognizable brand image, popularizing the brand among the target audience, and achieving annual sales of 5 million bottles. During the initial stages, it will be sufficient to achieve the desired revenue and continue evolving. Thus, the long-term goals include increasing sales to 20 million bottles per year by introducing new coffee flavors and expanding into new markets. By achieving these goals, the company can enter a new phase of its development and compete with competitors.
Target Markets
The target market for the new product offered by Coca-Cola will be similar to the previous one. The brand offers its products to a diverse range of clients with varying backgrounds and income levels. These include young people aged 18-44, the biggest group consuming the company’s products.
People with a middle-income level are focused because of their adequate paying capacity. Moreover, the brand cooperates with individuals who love coffee, as new flavors can be more attractive to them. Advertising campaigns are typically targeted at market segments that possess the aforementioned features. First, the North American and European markets are selected for distribution as they are considered the most attractive.
Positioning
The Coca-Cola Company positions its products as thirst-quenching and refreshing, bringing joy to the target market. They are associated with having a good time with family, walking along, and spending a weekend. Thus, a new product preserves the same approach to positioning.
Coca-Cola focuses on the unique flavor, helping people relax during the day, and combines the taste of the company’s traditional drinks with the distinctive feel of coffee. Thus, by utilizing product differentiation and diversification, the company can effectively address its target audience and ensure that its products are popularized, benefiting from increased attention. For this reason, the marketing also focuses on positive feelings and unusual tastes.
Strategies
The Coca-Cola Company employs specific strategies to maintain its connection with the audience and achieve high sales. First, it focuses on continuous product line diversification to meet the growing demands of clients for new tastes. Adding new flavors to traditional drinks is viewed as part of this strategy. Moreover, it can help the company to acquire an advantageous position compared to its closest rivals and enter new market segments.
Second, the brand utilizes social media and collaborates with celebrities as part of its marketing strategy. It helps create an iconic image and makes it an integral part of pop culture.
The company follows the same strategy by introducing new products, as this approach has proven effective and helps the corporation maintain its leading position. Thus, diversification and increasing awareness levels are the primary priorities for Coca-Cola Mocha Coffee. They help attract clients’ attention to the new product and overcome rivals. At the same time, the promotional campaign, which utilizes social media, newspapers, and celebrities, is a potent tool to inform society about the brand’s new products and ensure that the target audience and new clients appreciate them.
Marketing Mix
The marketing mix is a critical concept that helps understand the combination of factors a company can control to influence clients to buy its products. These include product, place, price, and promotion. The Coca-Cola Company traditionally devotes considerable attention to these components as the core of its strategy. The specific differentiation and positioning strategy impacts the choice of price, promotion, and products offered to clients. At the same time, the brand’s marketing mix considers the performance of its closest rivals to ensure the firm maintains a competitive advantage and can effectively compete to acquire new benefits.
Product
Currently, Coca-Cola has a diverse product portfolio of around 500 sparkling and still brands, offering around 3,900 beverage choices. Its central product, Coca-Cola, is one of the iconic and most recognized drinks globally. Adding a new beverage, Coca-Cola Coffee Mocha, contributes to the further expansion of the product line and its diversification. The brand controls this aspect of the marketing mix by constantly adding new flavors as part of its strategy. Thus, introducing a new offering is vital for further developing the brand and its ability to compete with its closest rivals. At the same time, it adds value and helps to maintain the high level of clients’ interest.
Price
The Coca-Cola Company’s pricing strategy is established based on the current peculiarities of the market and the brand’s major competitors. For instance, PepsiCo is the closest competitor, meaning the prices are set competitively to ensure clients can select among products without the necessity to pay too high costs. Moreover, Coca-Cola uses prices to promote brand loyalty.
Bulk buyers can enjoy lower prices, which helps to increase sales and cooperate with retailers. The price for a new product is established following the same considerations. Coca-Cola Coffee Mocha has a reasonable price, making it affordable for clients and competitive. That is why the brand can expect high loyalty and interest levels.
Place
As stated, the corporation has a developed distribution system helping it reach clients globally. Using a developed distributor and retailer chain, it works in Europe, Asia, Africa, the Pacific, and North America. Its subsidiary, the Coca-Cola Export Corporation, cooperates with bottlers globally, ensuring the product can be delivered to various locations. In such a way, the brand uses grocery stores, cafes, street vendors, restaurants, amusement parks, and other marketplaces as appropriate places for distributing and selling its products. A new offering is distributed using the same channels and approaches. It will help offer a coffee-flavored drink to the loyal audience and guarantee high sales during the first period.
Promotion
Because of the high level of competition characterizing the industry, the Coca-Cola Company makes significant investments in promotion campaigns to ensure it overcomes its closest competitors and promotes a higher level of sales. The marketing expenditure is about $4,5 billion, evidence of the significant resources devoted to promotion. Besides traditional campaigns, the Coca-Cola Company uses the Internet and social media, cooperates with influencers, and releases promotional videos.
A strong advertising campaign supports launching a new product with famous people discussing the drink. The same applies to a coffee mocha-flavored drink. As a result, the promotional campaign helps to raise the product’s awareness and guarantee that it is interesting for clients. Figure 3 represents the summarized information about the Coca-Cola 4Ps marketing mix:
Marketing Research
The Coca-Cola Company effectively uses various research tools to investigate the current state of the market and ensure it uses specific measures to address recent tendencies. Thus, the customers’ negative attitudes towards plastic waste and environmental concerns resulted in increased attention to sustainability issues within the company. The corporation launched a new campaign aimed at improving the management of plastic waste produced by the company.
Moreover, its new products, such as the discussed one, are supplied in recyclable packages and made of materials that can be reused. It helps to meet the client’s demands for sustainability and improve the brand’s image. Additionally, using focus groups, surveys, and interaction in social media, the Coca-Cola Company monitors the existing requirements for taste and flavors, which helps to control clients’ satisfaction levels and ensure they are ready to continue cooperation with the brand. In such a way, market research is a critical part of the brand’s marketing strategy, helping it introduce new products.
Financials
It is projected that the company will continue its successful evolution. The launch of the new product can have a positive impact on revenue and income. Around 50 million bottles of Coca-Cola with Coffee Mocha are expected to be sold at about $2 per bottle during the first phase. Thus, it is possible to anticipate the first-year loss because of the lack of awareness and time needed for the product to enter the market and become popular.
At the same time, in the second year, the number of sold items is expected to double and comprise around 100 million bottles globally, with the chance to enter new markets. For this reason, the product will become profitable when sales exceed this number, meaning that the company can benefit from its decision to launch a new line.
Controls
The implementation and organization of the main marketing activities will be controlled in several ways. First, the level of client satisfaction will be monitored by surveys and feedback collection. It will help to remain informed about the product’s success and ability to meet the target audience’s demands. Second, if any problems emerge, the quality department and the team responsible for the new offering must implement appropriate measures to ensure the issue is corrected and clients enjoy the high-quality product. At the same time, the Coca-Cola Company’s top management is responsible for the success of new projects and their ability to enter the market. In such a way, the controlling function is supported by continuous data collection and the work of teams and top management, who are responsible for the incentive.
Conclusion
Altogether, Coca-Cola holds a strong position in the modern non-alcoholic beverages market. It is one of the leaders in offering numerous products to clients. However, the brand must meet new clients’ demands to preserve its global domination. For this reason, Coca-Cola with Coffee is a new beverage introduced to the market. It will help to preserve the high level of clients’ interest and overcome rivals.
The marketing strategy implies using the developed distribution channels available to the corporation, advertising via social media and the Internet, engaging celebrities, and using traditional means. At the same time, the pricing strategy will help to ensure high brand loyalty. The new product will help the company dominate and continue its evolution.
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