Founded in 1886 in Atlanta, Coca-Cola Company is the world’s leading manufacturer, marketer and distributor of nonalcoholic beverage concentrates and syrups, used to produce more than 230 beverage brands. It is also the world’s most inclusive brand and company.
It has already ventured regionally out of Atlanta to other states of United States since the late 19th century and its signature contour bottle was first manufactured in the early 20th century to distinguish itself and assuring the genuine Coca-Cola. Though the company grew rapidly and roared into some European countries during the 1900s, its presence worldwide grew swiftly only after World War II.
Prices start at $12
Prices start at $11
Prices start at $12
Year after year, the company has been discovering new foreign markets to bring higher profits to fulfill its ultimate obligation to provide consistently attractive returns to the owners of the company and to enlarge its customer base in order to achieve economics of scale. Due to strong competition with Pepsi-Cola, Coca-Cola wants to reduce its dependence on the United States market, which is their similar domestic market, to reduce its risk and increase its global market share by going international. Presently, the company has already reached six billion consumers in nearly two hundred countries.
Coca-Cola Company has been very successful in the international marketing efforts. Aggressive advertising, branding and market segmentation have played an important part in the success. It has portrayed itself as fun, playfulness, freedom, lifestyle and the international appeal of Coca-Cola was embodied by a 1971 commercial, where a group of young people from all over the world to a hilltop in Italy to sing “I’ll like to buy the world a Coke”.
The company has been sponsoring big events, like Olympics, Sea Games, FIFA Cup, International Film Festivals all over the world to create awareness, credibility and to brand itself as a world-class company. It also makes big donations to organizations, charities and involvement in the communities. These activities have aided Coca-Cola in creating a positive image and consumers’ perception of the company.
Though the company makes the world its target market, segmenting by diverse consumer preferences would still be required to help Coca-Cola to serve the consumers better. As different segments of different countries have various preferences or cultures, Coca-Cola tried to expand with new flavours, brands and even reduced the sugar contents in its Coke, to suit all the different segments. This often increases the acceptance of new drinks that are specially designed for them.
Coca-Cola entered foreign markets in various ways. The most common modes of entry are direct exporting, licensing and franchising.
Besides beverages and their special syrups, Coca-Cola also directly exports its merchandise to overseas distributors and companies. Other than exporting, the company markets internationally by licensing bottlers around the world and supplying them with the syrup needed to produce the product.
There are different types of franchising. The type that is used by Coca-Cola Company is the manufacturer-sponsored wholesaler franchise system. It is very comparable to licensing but the only difference is that the finished products are sold to the retailers in the local market.
Foreign environment factors have influenced Coca-Cola’s strategies in international marketing. Culture has a tremendous effect on people’s preferences and perceptions. Language is one of the aspects of culture that marketers must take care of, in terms of translating product names, slogans and promotional messages so as not to convey the wrong meaning. Coca-Cola did not look much into this aspect when entering into the markets of countries like China and Taiwan as the literal translation of Coca-Cola in Chinese characters means, “bite the wax tadpole”.
Political structure and legal considerations also have impinged on Coco-Cola Company’s strategies. Governments of some Arab nations boycotted Coca-Cola’s products due to a political dispute and discontented with the company for maintaining distributors in Israel.
Changes are necessary for international marketing for consumer products, as it is important that the products suit one’s taste, preferences and fulfill one’s needs. Coca-Cola has continued changing, improving and developing new drinks to appeal to local tastes.
After discovering that Coke did not appeal as much to Japanese consumers, Coca-Cola developed over 30 new drinks for the Japanese market, which inclusive of Asian tea, English tea, coffee and fermented-milk drink.
In China, Coca-Cola has also begun a similar strategy of introducing beverages developed for the taste buds of the local market. It launched a fruit juice drink called Tian Yu Di (Heaven and Earth) specifically for the Chinese market with the planning of introducing the market with a Chinese iced tea and soy milk drink.
Being flexible and willing to change to satisfy consumers’ needs, has enabled Coca-Cola to exploit the economies of scale that was gained by its global marketing and at the same time making its products appeal to local taste, which has earned the company enormous profits quarterly.
As Coca-Cola has expanded over the decades or even nearly a century, the company has benefited from the various cultural insights and perspectives of the societies in which business is done. No doubt of the remarkable experience it has, it is still very committed to local markets, to paying attention to what people from different cultures and backgrounds like to drink, and where and how they like to drink it, to remain competitive and to develop more new drinks to satisfy its markets.
Now, the estimated brand equity of Coca-Cola is $84billion, a market share of more than 50 percent in the beverage industry globally and about 70 percent of its income comes from countries outside the United States. Every 10 seconds, 126,000 people in the whole world, choose to reach out for one of The Coca-Cola Company brands, and it is the company’s mission to make that choice exciting and satisfying, every single time.
Not only to make great drinks, but Coca-Cola is also determined to contribute to communities around the world through its commitments to education, health, wellness, and diversity and consistently shaping its business decisions to improve the quality of life in the communities in which the company does business.
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