Académique Documents
Professionnel Documents
Culture Documents
Abdul Monem Ltd. (AML) is the only official bottler of Coca-Cola, Sprite, Fanta Orange and
Fanta Lemon in Bangladesh authorized by the Coca Cola International headquarter located in
Atlanta, USA. Through three bottling plants located in Dhaka, Comilla and Chittagong and with
a devoted distribution channel spread all around the country, AML has well established its strong
and dominant presence in beverage industry of Bangladesh. Coca-Cola gives 1700 people
working facility in Bangladesh.
The Coca-Cola company is the worlds largest beverage company and is the leading producer
and marketer of soft drinks. However Coca-Cola is not the sort of company to live in its past
glories instead it looks to the future as a challenge and constantly seeks new markets and ways of
increasing its market share in areas where it currently has a strong presence. It is the worlds
largest producer and distributer of syrups and concentrates for soft drinks.
As we all know, the Coca is todays one of the biggest corporation that offers different
refreshment in form of a soft-drink. But aside from their historical success, the Coca Cola
Company is still a typical business that is affected and at the same time affecting the different
type of communities.
For generations, the simple pleasure of drinking Coca-Cola has been associated with special
times, special places and timeless moments but also with the satisfying experience of everyday
life. That is the magic of Coke. Coca-Cola, the brandis the heart of our company. It has always
been and always will be. Coca-Cola, Fanta and Sprite create the magic to provide consumers
1 | Coca-Cola
with special moments. Consumers of all ages want great tasting beverages that also provide
nutrients for healthy growth and to make them feel their best.
There are two important things. The company have to do
1. Enhance the Coca-Cola trademark
2. Satisfy the Customer needs and expectations
The Customer is always right
Coca-Cola committed to
2 | Coca-Cola
General environment Analysis of
Coca-Cola
The Coca Cola Company and other organizations have their own weaknesses
and strengths that can both affect the future performance of their respective
business in the external environment. Analyzing the external environment in
Bangladesh constraints is an advantage for the companies since they can
identify the possible factors that tend to leave an impact on their business.
These six external environment factors are discuss below
Political/Legal Environment:
The legal factors include discrimination law, customer law, antitrust law,
employment law and health and safety law. In Coca-Cola the business is
subjected to various laws and regulation in the numerous countries in which
they do the business, the laws include competition, product safety,
advertising and labelling, container deposits, environment protection, and
labor practices.
3 | Coca-Cola
In Bangladesh, the products of the company is subjected to various acts like
Drug and Cosmetic Act, Occupation Safety and Health Act, various
environment related acts and regulations, the production, distribution, sale
and advertising of all the products are subjected to various laws and
regulations. Changes in these laws could result in increased costs and capital
expenditures, which affects the company profitability and also the
production and distribution of the products.
4 | Coca-Cola
The political conditions of the country are also basis of the study, especially
in internal markets and other governmental changes that affects their ability
to penetrate the developing and emerging markets that involves the political
and economic conditions. However, Coca-Cola continuously monitoring the
policies and regulations set by the government.
Coca Cola has to make sure that they have written price, manufacturing date, expiry date,
batch no, nutritional facts are written on the packed product. Ministry of Labor makes
the laws for proper employment in the country.
5 | Coca-Cola
They have stipulated norms on employing people from the country and getting
expatriates in the company as well. Coca Cola has made sure that female employees are
treated with respect and given equal importance at the work place. Every field of work
has got its own wage, these are to meet the norms and laws set by the labor ministry of
Bangladesh. When employing anyone, Coca Cola doesnt discriminate on social, regional
or any racists basis.
Economic Environment:
The economic factors analyze the potential areas where the firm can grow and expand. It
includes the economic growth of the country, interest rates, exchange rates, inflation
rates, wage rates and unemployment rate in the country.
14 November 2014 Inflation continued its descent in October, coming down to 6.6
percent. In recent days Coca-Colas inflation grows 7.5%. In Bangladesh 45%-55%
charges for their disposal income as corporate rule and charges 25% as individual rule.
Economic environment examines the local, national and world economy impact which is
also includes the issue of recession and inflation rates. The non-alcoholic beverage
industry like Bangladesh has high sales in countries outside the U.S because here alcohol
is strongly prohibited from religious perspective.
6 | Coca-Cola
According to the Standard and Poor's Industry surveys, "For major soft drink
companies, there has been economic improvement in many major
international markets, These markets will continue to play a major role in the
success and stable growth for a majority of the non-alcoholic beverage
industry like Bangladesh. There is a low growth in the market for carbonated
or soft drinks, especially in Coca Colas main market.
The company first analyzes the economic condition of the country before
venturing into that country. When there is an economic growth in the
country, the purchasing power among people increasing. It gives the
company or the marketer a good chance to market the product. Coca-Cola, in
the past identified this correctly and rightly started its distribution across
Bangladesh.
Interest rates are the rate which is imposed on the company for the money
they have borrowed from government. When there is an increase in the
interest rates, it may determine the company in further investment as the
cost for borrowing is higher. Coca-Cola uses derivative financial instruments
to cope up with the fluctuating interest rates. Inflation and wage rate go
hand in hand, when there is an increase in the inflation the employee
demand for a higher wage rate to cope up with the cost of living.
This comes as additional cost for the company which cannot be reflected in
the price of the final product as the competition and risk in this segment is
higher. This is a threat in the external environment faced by the company.
From the above explanation it is clearly seen that the economic factors
involves a major impact in the behavior of the company during various
economic situations.
Social-Cultural Environment:
7 | Coca-Cola
Social factors are mainly the culture aspects and attitude, health
consciousness among people, population growth with age distribution,
emphasis on safety. The company cannot change the social factors but the
company has to adjust itself to the changing the society. The company
adapts various management strategies to adapt these social trends.
Population growth rate and the age distribution is another social factor to be
considered. It is very important because non-alcoholic markets have most of
its share from the children and youngsters. Adults used to celebrate mostly
with alcohol. The age distribution of the country becomes important for the
success of the product in this country.
8 | Coca-Cola
Initially, it struggled to find acceptance as there were already other brands.
Coca-Cola had earlier focused more on the American way of life in their
advertising campaigns, which the Bangladeshi consumers could not identify
with. Also, they did not focus on competition from other alternatives.
However, things were brought under control when they gave more attention
on their marketing mix. With the lowering of their prices by almost 15-20%,
more investment in market research and focusing on the target group of 18-
24 year olds of our country, they were able to increase their market share
and build brand loyalty.
Coca Cola today, has made significant investments to build its business in
Bangladesh. It has also generated employment for lots of people in related
industry through its procurement, supply and distribution cycles in our
country.
The soft drink industry today is growing steadily due to the economy,
strengthened middle class and low per capita consumption. With the
increase in health consciousness among the urban consumers, the company
has introduced newer products such as Diet Coke, which contain lesser
calories than ordinary Coca-Cola. This is also responsible for the company
shifting focus from carbonated drinks to Fruit Drinks / Juices and bottled
water.
Technological Environment:
9 | Coca-Cola
Technology plays a varied role in the soft drinks industry. The manufacturing
and distribution of the products in our country is relatively a Low-Tech
business, although the creation of a new product with the perfect blend and
taste is a science (an art in itself).
Technology is the main focus of the analysis where the introduction and the
emerging technological techniques are valued. This creates opportunities for
new products and product improvements in our country in terms of
marketing and production. As the technology advances, new products are
introduced into the Bangladeshi market. The advancement in technology has
led to the creation of cherry coke but consumers still prefers the traditional
taste of the original coke in our country and all over the world.
Global Environment:
10 | Coca-Cola
Coca Cola has earned a title of environment friendly company and Coca Cola
Bangladesh too has followed in the footsteps. Coca-Colas Corporate is an
initiative that prioritizes many global issues; one of them being water
conservation. They support many community based rainwater harvesting
projects and help lending conservation education. Globalization is a way of
eliminating different countries continent and economy so as to make it easier
to trade and transections within and between other countries. Increase in
economic can be seen to be on the major benefit gain from globalization.
11 | Coca-Cola
From our analysis, we have found some challenges that Coca-Cola Company
is facing here in Bangladesh. The Challenges are as follows-
In Bangladesh, Coke Diet and Zero is not that much available. They are
having production and problem.
Demographic Environment:
The company should target the age group that consumes most of its brand
and customizes the promotional and marketing strategies that suits their
behaviors. Age is a factor that is relevant as the organization has to obey by
certain laws and regulations for example by advertising to children, it is
considered unconventional and morally wrong. Coca-Cola have stated that
they will not advertise their products to children and will not show them on
children TV channels as they contain high quantity of sugar and are
unhealthy.
12 | Coca-Cola
Coca-Cola produce different product for different region. Thus, marketers
need to form more precise age-specific segments within each group. Defining
people by their birth date may be less effective than segmenting them by
their lifestyle, life stage, or the common value they seek in the product they
buy. So Coca-Cola as a soft drink it target the youth and old people while the
other products under Coca-Cola.
According to the survey conducted by an international firm, Bangladeshi people like little
bit sweeter cola drink. So for this coca cola company should produce their product according
to the local demand.
Marketing team should try to increase the availability of Coke in rural areas.
They should also focus on the old people.
Now young generation has a trend to drink a coke 2 regular bottle at same time, so providing
more satisfaction to them company should introduce liter disposable bottle.
As, in Bangladesh, having a good number of demand, Coke Diet and Zero is not that much
available, so they should emphasize on the supply of these two brands.
SWOT Analysis:
13 | Coca-Cola
The alphabets in the word SWOT sands for Strength, Weakness, Opportunity and Threats. In
SWOT analysis, we basically going to discuss about the strength, weakness, opportunity and
threats of Coca-Cola Company. So, here goes the SWOT analysis of Coca Cola Company.
Strength:
The best global brand in the world in terms of value: According to Interbrand, The Coca
Cola Company is the most valued ($77,839 billion) brand in the world.
Worlds largest market share in beverage: Coca Cola holds the largest beverage market
share in the world (about 40%).
Strong marketing and advertising: Coca Cola advertising expenses accounted for more
than $3 billion in 2012 and increased firms sales and brand recognition.
Most extensive beverage distribution channel: Coca Cola serves more than 200 countries
and more than 1.7 billion servings a day.
14 | Coca-Cola
Customer loyalty: The firm enjoys having one of the most loyal
consumer groups.
Bargaining power over suppliers: The Coca Cola Company is the
largest beverage producer in the world and exerts significant power over
its suppliers to receive the lowest price available from them.
Corporate Social Responsibility (CSR): Coca Cola is increasingly
focusing on CSR programs, such as recycling/packaging, energy
conservation/climate change, active healthy living, water stewardship and
many others, which boosts companys social image and result in
competitive advantage over competitors.
Weaknesses:
15 | Coca-Cola
Brand failures or many brands with insignificant amount
of revenues: Coca Cola currently sells more than 500 brands but only
few of the brands result in more than $1 billion sales. Plus, the firms
success of introducing new drinks is weak. Many of its introduction result
in failures, for example, C2 drink.
Opportunities:
Bottled water consumption growth: Consumption of bottled water is
expected to grow both in US and the rest of the world.
Increasing demand for healthy food and beverages: Due to many
programs to fight obesity, demand for healthy food and beverages has
increased drastically. The Coca Cola Company has an opportunity to
further expand its product range with drinks that have low amount of
sugar and calories.
Growing beverages consumption in emerging markets:
Consumption of soft drinks is still significantly growing in emerging
markets, especially BRIC countries, where Coca Cola could increase and
maintain its beverages market share.
Growth through acquisitions: Coca Cola will find it hard to keep
current growth levels and will find it hard to penetrate new markets with
its existing product portfolio. All this can be done more easily through
acquiring other companies.
Threats:
16 | Coca-Cola
Changes in Consumer Tastes: Consumers around the world
become more health conscious and reduce their consumption of
carbonated drinks, drinks that have large amounts of sugar, calories and
fat. This is the most serious threat as Coca Cola is mainly serving
carbonated drinks.
Water Scarcity: Water is becoming scarcer around the world and
increases both in cost and criticism for Coca Cola over the large amounts
of water used in production.
Strong Dollar: More than 60% of The Coca Cola Company income is from
outside US. Due to strong dollar performance against other currencies
firms overall income may fall.
Legal Requirements to Disclose Negative Information on Product
Labels: Some Coca Colas carbonated drinks have adverse health
consequences. For this reason, many governments consider to pass
legislation that requires disclosing such information on product labels.
Products containing such information may be perceived negatively and
lose its customers.
Decreasing Gross Profit and Net Profit Margins: Coca Colas gross
profit and net profit margin was decreasing over the past few years and
may continue to decrease due to higher water and other raw material
costs.
Competition from PepsiCo. : PepsiCo is fiercely competing with Coca
Cola over market share in BRIC countries, especially India.
Saturated Carbonated Drinks Market: The business significantly relies
on the carbonated drinks sales, which is a threat for the Coca Cola as the
market of carbonated drinks is not growing or even declining in the world.
Conclusion
17 | Coca-Cola
After thorough research, we come to the conclusion that the marketing
strategy of Coca Cola is working for them and the product is gaining
popularity among youth day by day.
References:
Reference:
http://www.coca-colacompany.com/
http://en.wikipedia.org/wiki/The_Coca-Cola_Company
http://ivythesis.typepad.com/term_paper_topics/2009/12/pestle-
analysis-on-cocacola.html
http://annasurname.hubpages.com/hub/PEST-Analysis-Coca-Cola
http://smallbecomesgiant.wordpress.com/2013/04/04/pest-analysis-of-
coca-colacompany/
http://www.strategicmanagementinsight.com/swot-analyses/coca-cola-
swotanalysis.html
The End
18 | Coca-Cola