Sample Marketing Case Study Paper on the Coca Cola Company: Increasing New Product Awareness through Social Media

The Coca Cola Company: Increasing New Product Awareness through Social Media

Introduction of the Case

Being introduced back in the year 1886, the coca cola brand has been in the market for more than 100 years. However, despite its century-long presence in the market, the company still faces some problems related to the awareness of its new products. In particular, the company introduced its new low-calorie cola products but the products have not picked well in the market. The low-calorie cola products contain limited sugar content and are meant to curb obesity. Even though governments and health experts favor these new products, their overall awareness and consumption in the global market is anemic.

In an interview, Muhtar Kent, the company CEO asserted that Coca Cola Company need to increase strategically its new low-calorie brand awareness in the global market in order to remain fresh and top of the game in the soft drink industry. Even though the company has made incredible progress in increasing brand awareness progress over the past years, it continues to face new challenges stemming from competition and most importantly widely publicized concern over sugar contents in food products. For most parts of the campaign, the Coca Cola Company has heavily relied on its century-long history and overall brand awareness in promoting these new low-calorie products. However, that has not proved beneficial because the company has not managed to increase significantly the awareness for its new low-calorie products.

This case study investigated the primary contributing factors to the law awareness of the Coca Cola’s new low-calorie products and come up possible solutions to the problem. This would help the company remain afresh in the market and increase not only awareness but also consumption of its new low-calorie products. Due to public concern over obesity, governments, health experts, as well as media all over the global are scrutinizing sugar contents in soft drinks as the world shifts to low-calorie products. Therefore, increasing the awareness of low-calorie products is of great essence and importance to the Coca Cola Company.

Company Background

  • History

The Coca Cola Company is an American multinational company dealing in the production, distribution and sales of soft drinks. The company is headquartered in Atlanta but has other branches and subsidiaries in other countries across the globe. Young pharmacist from Colombia by the name John Stith Pemberton stated the Coca Cola Company in 1886. Since then, the company has steadily grown to attain global presence with its soft drink products being consumed in almost every country across the globe. The company is best known and recognized across many countries by its flagship product Coca-Cola that has become very popular across many cultures.

Since its establishment in 1886, the Coca Cola Company has achieved amazing milestone in its brand awareness, productivity, and sales. According to an annual financial reported issued by the company in 2015, it sells soft drink products to more than 200 countries consumed by more than 1.5 billion people worldwide daily. Even though the company produces a wide range of soft drink products, the flagship product, the ‘Coca-Cola’ also known as ‘Coke’ accounts for more than 80% of its product sales by volume. According to statistic by Zarrella (87), 43% of the coca cola products are sold in United States while 37% to Europe, Asia, and North America while the remaining 20% are distributed to the rest of the world.

  • Culture

The Coca Cola Company has established a winning organizational culture, which essentially defines its behavior and overall attitudes. The organizational culture at the Coca Cola Company is best summarized as all-inclusive and is defined by seven core values namely integrity, collaboration, passion, diversity, leadership, quality, and accountability. The culture that has established a strong team spirit, positive behaviors, and values enables the company to continue refreshing the world in body, mind, and spirit. The culture has enabled the company to understand, embrace, as well as operate its business successfully in a multicultural world.

  • Vision

The Coca Cola Company has a primary vision of “creating a great place for people to work, bringing a portfolio of quality beverage to the world, nurturing a winning network of customers and suppliers, building and supporting sustainable communities, maximizing long-term return to shareholders, as well as increasing productivity through efficiency, lean production and fast-moving organization”. The company’s vision was designed to serve as a roadmap that guides every aspect of its business towards achieving sustainable and quality growth.

  • Mission

As started in their website, the mission of Coca Cola Company is to “inspire moments of optimism and happiness, create value and make a difference, refresh the world, and inspire moments of optimism and happiness”. The mission statement was designed to help the company be enduring. In addition, it declares coca cola as a company and serves as a standard against which the company weighs its actions and decision-making.

Company Resources

  • Industry

The coca cola company is operating in the soft drink industry that consists of two major manufacturing systems that brings beverages into the global market – the two manufacturing systems consists of (1) soft drink manufacturing and (2) flavoring syrup manufacturing (Tuten and Michael 34). In the soft drink industry, majority of bottled beverages follow a similar product life cycle that move directly from syrup producers to bottlers, distributors, merchant, and consumers respectively. The major product lines within the soft drink industry are bottled water, fruit beverages, carbonated drinks, as well as functional beverages such as ready-to-drink coffees/teas and energy drinks. The major brands in this industry are Coke, Pepsi, Snapple, and Gatorade among others.

Once one the soft drink is produced and bottled, they are distributed through two major channels to the end consumers. The first distribution channel through which companies reach the end market is by selling finished bottled products to distributors and retailers. The second method is by selling the finished beverage concentrates and syrups to bottling partners to make the final product. In this method, the authorized bottling partners then mix the concentrate with carbonated water, sweeteners, and other ingredients to make the final product.

The global soft drink industry, as whole is facing some serious challenges. Apart from the slumping global economy and changes in consumption patterns, sugary soft drink is under fire from public health concerns. As explained by Shankar and Gregory (65), over the past few years, governments and media have launched dedicated public campaigns over sugar contents of soft drinks as a major outcry for increased obesity. As a result, the sugar content of soft drink has, over the past few years, received increased scrutiny over overall health and wellness of the people.

  • Market

According to a recent statistic by word bank, the global market size of soft drink was 891.9 billion US dollars in 2015 – this consisted of different products including carbonates, fruit juice, vegetable juice, bottled water, energy drink, sport drink, concentrates, and ready-to-drink tea. The report further indicates that carbonates contribute the greatest market size of $348 billion in 2015 followed by bottled water and juice with market size of $201 billion and $158 billion respectively.

The primary consumers of soft drink products consist of Hispanic, millennial and teens. The Hispanic community in the United States of America including people of Mexican, Cuban, Puerto Rican, and Central American descent constitutes the greatest market for soft drink products especially the Coca Cola. Millennial, a generation of people born between 1981 and 1996 also consume soft drink in great amount (Dickson and James 45). In essence, the market for soft drink products is largely constituted by the growing middle class, teens as well as the elderly people. Apart from United States of America where it is largely consumed, soft drink products also have significant market in Asian content, Middle East, Europe and Africa.

  • Environment

The coca cola company is operating in highly competitive and rapidly changing environment. There are many companies such as Pepsi that produce a wide range of soft drink products, competing with the coca cola for the limited consumers. However, the industry does not face threats from new entrants simply because the two major companies have established extensive bottling and distribution networks.

Problem Identification – Issue & Motives

We are in a changing business world and the impact can be felt far and wide. New challenges come and business develops new strategies on dealing with such issues and challenges. The health and wellness concern is very real and its impacts can be seen in the soft drink industry as companies change their strategies and products to meet the new guidelines. The biggest health debate, which now greatly affects products in the soft drink industry, is the consumption of high calorie products and its impacts on health and contribution to increased obesity incidence. Most governments including United States of America have come up with new guidelines for sugar products. In addition, governments and media have put forward dedicated public awareness campaigns against consumption of sugar product.

With clear understanding of the health issues at hand, the coca cola company came up with a new strategy of producing low-calorie soft drink products. These products are developed to use limited amount of sugar of not none. In the meantime, the company offers a wider range of low- and no-calorie beverages such as Fanta Zero, Sprite Zero, Diet Coke, Fresca, and Coke Zero. In the initial plan, these products were developed targeting United States and Canada and ultimately the global market. The company has been producing these products alongside their primary calorie soft drinks.

Even though they are meant to reduce consumption of sugar products that have become a great problem to the world, they have not significantly increased in popularity in the global market. Over the past years, the Coca Cola Company has struggled to market is low calorie products to consumers. Even though these new low calorie products are ranked top brands, their overall consumption is still anemic in United States and other countries. Julia (44) argues that the problem lies with the coca cola’s strategy for marketing the new products. In the increasingly competitive market where many companies have started producing a wide range of low calorie soft drinks, the company needs a new marketing strategy and communication approach that would change mindset of the consumers and bring them onboard.

Being a century-old brand, it is apparently harder for the coca cola company to excite consumers if they continue using the same marketing strategy. The question that is being asked is whether the coca cola can increase the awareness of its low calorie products through social media marketing. The issue at hand, which has greatly contributed to low consumption of coca cola’s low calorie soft drinks, is lack of awareness. Since the company started producing low calorie soft drink, they have not put forward dedicate marketing strategy that would increase awareness of the product. As noted by Ruzzier, Mitja and Robert (32), the company has continued marketing its traditional products through TV, newspaper and online advertisement at the expense of low calorie cola products – there are few advertisements and campaigns about these healthful products.

The motive, therefore, is to find a method of increasing the awareness of coca cola’s low calorie products. If awareness of the products is increased, their popularity and consumption will subsequently increase because the world is greatly awareness of the health problems associated with high calorie products.

The Proposed Solution

The problem of low awareness of coca cola’s low calorie products can be solved through dedicated social media marketing and communication. Social is a great tool that the company can use to communicate and market is new low calorie products and let them reach millions and millions of consumers across the globe without any limitation. The beauty of this strategy is that majority of the middle class and teens, which are the greatest consumers of coca cola’s products, are in social media and can be reached by just a single press of a computer button. Communicating and marketing coca cola’s low calorie drinks is essential attracting new consumers as well as increasing sales volume and profitability. In addition, this strategy would enable existing customers to attract new consumers from across the world.

The beauty of social media marketing is that it is not restricted to any part of the world or region – anybody can access the communication easily anywhere anytime. Social media marketing is growing and continuously transforming the way business is communicated across the world – it can be used to communicate the product both externally and internally.

Julia (44) defined social media as the use of various social media platforms such as Facebook, Twitter, Google Plus, and LinkedIn among others for promoting products and services. In addition to these three, other social media platforms provide their own built-in analytics. The coca cola company can use a combination of these social media platforms to promote the awareness of their new low calorie products in the market. In addition, by using Facebook, Twitter, Google Plus, and LinkedIn, the company interacts with consumers and shares the experience of the low calorie products. This way, the company would greatly increase the awareness of these products and successfully market them to a wide class of consumers.

Analysis & Evaluation of the Solution

In the contemporary business, majority of companies have shifted to social media marketing because it is fast and has ability to reach out to many potential consumers. In addition, this strategy would offer coca cola company huge benefits in terms of maintaining positive public relations in addition to marketing its new products. The company would directly communicate with its audience worldwide in many different ways through the internet either by using computers or their mobile handsets. Social media platforms have tools which the company can use to its potential customers, existing clients as well as employees and stakeholders thus enabling easy and quick communication.

Most social media marketing platforms are based on two-way communication thus allowing the company and customer to interact at a personal level. The company can use Facebook, Twitter, Google Plus, and LinkedIn to post useful information about their products and users will see thus facilitating increased awareness. Another way through which the coca cola company can increase awareness for its new low calorie drinks on social media is to create social content that online users can view and read. Furthermore, it can use the social media platform to run marketing campaigns that would significantly increase the global awareness of the new products.

The potential of social media marketing in increasing awareness of the new products is very great. For instance, as explained by Shankar and Gregory (65), the strategy would play great role in helping the company increase its market share value. In addition, it would help solve the company’s problem by growing the sales volume and company turnover as many consumer start purchasing the new low calorie cola products. The company will not only reach out to online consumers but also remote purchasers through sharing and referrals.

The use of social media marketing strategy would help the Coca Cola Company enhance and strengthens its brands. In addition to strengthen the coca cola brand, this strategy would help create customers who are loyal to the company because they understand the value of products they are purchasing. Lastly, social media marketing is cost and is effective in increasing awareness since majority of consumers are now available online through their mobile handsets or personal computers.

Alternative Solutions

Apart from social media marketing, the coca cola company can increase the awareness of its new low calorie product through traditional marketing such as TV and newspaper advertisement. These two alternative approaches come very close to social media because the company is able to reach millions of consumers through television and newspapers. However, the only disadvantage of these alternative solutions is that they are costly – the company would have to spend millions of dollars on TV and newspaper advertisement.

Conclusion

Social media has become a very popular tool for marketing in the contemporary business environment. This case study shows that the coca cola company can successfully use social media marketing to increase the awareness of its new low calorie products. The result of the study shows that the low calorie cola products are currently not popular in the market due to lack of awareness. This has directly reduced the profitability of the company due to low sales volume from low-calorie products. However, the company can turn this around by using social media to increase awareness of the products. The Coca Cola Company can use a wide range of social media providers such as Twitter, Facebook, and LinkedIn to communicate and increase awareness of the products.

Over the past few years, the coca cola company introduced a wide range of low calorie drinks such as Fanta Zero, Sprite Zero, Diet Coke, Fresca, and Coke Zero among others. However, since introduction in the market, the company has not managed to achieve the recommended sales level. In addition, these products are not highly consumed as compared to the other products. It is for the reasons, alongside the health risk of sugar consumption that we recommend the coca cola company to use social media marketing to increase the awareness of these products. The main problem of low consumption associated with Cola’s low calorie product is lack of awareness.

Work Cited

Dickson, Peter R., and James L. Ginter. “Market segmentation, product differentiation, and marketing strategy.” The Journal of Marketing (2008): 1-10.

Julia, Anders. Coca-Cola’s “Marketing Strategy: An Analysis of Price, Product and Communication”. 2013. GRIN Verlag. Print.

Ruzzier, Maja K, Mitja Ruzzier, and Robert D. Hisrich. Marketing for Entrepreneurs and Smes: A Global Perspective. Cheltenham: Edward Elgar Pub. Ltd, 2013. Print.

Shankar, Venkatesh, and Gregory S. Carpenter. Handbook of Marketing Strategy. Cheltenham, UK: Edward Elgar Pub, 2012. Print.

Tuten, Tracy L, and Michael R. Solomon. Social Media Marketing. 2014. Print.

Zarrella, Dan. The Social Media Marketing Book. Beijing: O’Reilly, 2010. Print.