What Distinguishes Coca-Cola from Its Competitors - Essay Example

Coca-Cola In the world of business there are very few images that are as well recognizable as the Coca-Cola brand. It is known in the furthest locations of the globe and marketers today look to that brand as a model of their marketing power. Through years of its image, Coca Cola has vanished borders and cultural barriers and reached almost every person on earth. One can only assume how this company became such an ubiquitous image (Zurn, n.d.). The following paper will examine the fantastic popularity of Coca Cola beverage, its history, controversies surrounding the brand and the factors that successfully differ the company from its competitors. How did the company start? The history of Coca Cola brand starts in 1886 when it President John Pemberton travelled across the country in order to introduce pharmacists to the drink. At that time, the beverage was considered a medicinal substance which aim was to relieve headaches and other minor health issues. Since that time the brand penetrated further the world, continuing bottling in the submitted standard size bottle, the so called Hobbleskirt Bottle.  Since the brand continuing to expand into such countries as Cuba and France, its world dominance gradually grew. Today the Coca Cola owns and manages more than five hundred nonalcoholic beverage brands, both sparkling and still beverages, juices and juice drinks, ready-to-drink teas and coffees and also energy and sports drinks. These are the Coca-Cola, Diet Coke, Fanta and Sprite which are spread across Africa, Europe, Latin and North Americas. Its Sacramento Bottling Company, Fresh Trading Ltd and ZICO Beverages LLC were also acquired by the Coca Cola Company (Coca-Cola Company, n.d.). The controversies surrounding Coca Cola Despite the popularity of the world brand, Coca Cola has also faced much criticism from different groups, mostly concerning health effects issues, environmental problems and numerous business practices. Thus, in 2014 a brominated vegetable oil was found in Cocal Cola fruit and sports drinks, particularly in Fanta and Powerade. The Mayo clinic researchers reported that excessive use of BVO can impact negatively to the health, causing memory loss and skin and nerve problems. However, the company management stated that the level of BVO used in its drinks did not exceed the limits and was not harmful for the consumers. Along with it, public pressure and online petition to remove the BVO from the company’s drink was growing. The mass protests were heard and the BVO component was removed from the drinks. Another issue that the company faced with concerned a new program that Coca Cola aimed bring to certain parks in UK as free fitness classes. It was challenged by the health campaigners. The controversy with the new plans to give twenty millions anti- obesity fitness drive obtained certain criticism, because the campaigners accused the Coca Cola in the indecent attempt to distract people from the fact that Coca Cola was fuelling UK with obesity problems (Donelly, 2014). The report by Public Health England claimed that soft drinks and fruit juices produced by the Coca Cola provided the biggest amount of sugar for its consumers and some cardiologists stated that the company was trying to distract attention from its part in creating the obesity situation in the country. However, the Coca Cola appealed that its new drinks were aimed to help tackle obesity in UK and its sales were involving a zero calorie version of drinks. People sponsored by Coca Cola With the billions of drinks that Coca Cola sells every day, it also spends more than two billions dollars a year for advertising its products along with the another five billion dollars for marketing and promotion (Just Chew It: Coca-Cola, 2014). It is a Gold Sponsor of Cricket Australia, it gives money to the Rugby League and AFL clubs. Being a major partner of AFL and NRL, Coca Cola spends millions of dollars for AFL stars Chris Judd and Israel Folau, NRL star Timana Tahu . While Pepsi has Beyonce , the Coca Cola’ Coke will spend certain amount of money for involving Taylor Swift, a singer, to its promotional campaigns. She is a brand ambassador with the partnership in a simply thirty second TV spots. Taylor Swift places the high rate in the list of 2012's top Money Makers, competing with Adele and Lady Gaga. Her deal with Coca Cola to represent Diet Coke follows a profitable contract with Cover Girl. For the company it is a great opportunity to be represented by such a celebrity (Zmuda, Parekh, 2013). IN the modern world of technologies, there appear bigger opportunities for the companies to raise their popularity through involving numerous celebrities into helping the companies to promote their products. Thus, famous people promote this or that company by adding different posts and comments on social networks, such as Twitter and Facebook providing their support to the certain beverage or drink. The Coca Cola company enlists stars from the variety of profession, evolving sportsmen, such Michelle Kwan, a figure skater, Ted Ligety, the Olympic skiing and Jessica Long, the Paralympic swimmer to support its products. Besides, there are such musicians ad Maroon 5 band, Ryan Seacrest, the TV personality, Ken Jeong, the comedian, that also were involved to promote Coca Cola’s products in the certain period of time. What distinguishes Coca Cola from its competitors? The Coca-Cola Company owns the unrivalled distribution network that operates in two hundred countries across the globe. Although the infrastructure is extremely difficult and costly, it does not prevent the company to acquire a sustainable competitive advantage. One of such advantages of the company over its rivals is its 2020 Vision which concerns the commencing implementation of a 21st century beverage partnership model in the U.S. This model represents the company and five other U.S bottlers to agree a principle to create a stronger U.S business model by granting new territories. These are the Coca-Cola Bottling Co. Consolidated, the Coca-Cola Bottling Company United Inc., Swire Coca-Cola USA, Coca-Cola Bottling Company High Country and Corinth Coca-Cola Bottling Works Inc. The model will enable the company operate more rational in the contiguous operating territories; it will establish a grant of exclusive territory rights  and distribution assets and cold drink equipment; n improved and more integrated information technology platform will be used by the company; a new beverage agreement will support the evolving operating model. Besides, the company aimed at reducing customers’ costs and risks creating value and sources of competitive advantage for its consumer. However, if consider the situation with the purchasing of a can of Coca-Cola in a supermarket with the price for a can in about twenty five cents as a part of the 24-pack, then in a hot summer day the same consumer will have to pay two dollars for a chilled can of the same Coke. This price premium is attributable not to a different product, however it means than a consumer will be more likely to buy the 24-pack saving one’s money (Bicle, 2011). What is cokes most lucrative product? Unlike its nearest competitor, Pepsi, the Coca Cola did not diversify its food products but continued to develop beverages owning the four world’s biggest beverage products. With more than one billion gallons of the company products consumed every day in the world, there are the most popular. The Fuse, a billion-dollar brand of fruit juices, non-carbo-hydrated drink and vitamin-fortified beverage is recognized in Asia. A new brand acquired by the Coca-Cola Company, Del Valle, a line of natural fruit juices and extracts, which is now one of the company’s billion-dollar ones. Its biggest sales are now in Mexico, Venezuela and Brazil. Minute Maid, a line of concentrates and carbonated drinks mixed in with fruit juice has a great popularity in Europe and is the biggest distributor of fruit juices in the world with two billion dollars of global sales. The line of sport drinks, a Powerade contains a mix of electrolytes and carbohydrates that replace chemicals lost when individual is sweating. Designed to compete Gatorade, it currently holds seventy- five percent of the U.S. market and is growing creating a considerable advantage for the Coca Cola Company. The other Coca Cola representative, Coca-Cola Zero, which was released in 2004, now competes the online and real-life marketing. Originally, this beverage was aimed to be more masculine version of Diet Coke. However, now it is the most loved drink as by men as women. A fruit carbonated drink Fanta is the family brand that promotes fun, health and tasty flavor. This is the second largest brand of Coca Cola outside the United States. Sprite is considered the most refreshing drink with lemon and lime that composes the eight percent of the beverage market of the company. Introduced in the 1960’s, Sprite’s popularity has overcome Pepsi’s 7-Up. The list of Coca-Cola most popular products would be incomplete without Dr. Pepper, which pulls in a considerable amount of money for the Coca Cola Company. Dr. Pepper fans state that the distinct flavor of this beverage cannot match any other soda. Seventeen percent of the market share is given to the Diet Coke. And of course the Classic Coca-Cola, the largest and most recognizable brand in the world, the best- selling product that captured the hearts of millions of soda drinkers and is available in all countries in the world. It makes up eighty percent of the company’s beverage market having no rivals at all (Said, 2013). Future plans and goals for Coca Cola The Coca-Cola Company produces more than three thousand beverage products across the globe. It for sure faces numerous challenges regarding health and the preserving of the environment. Along with these issues, the growing concerns about obesity attack the company in some markets, because of the excessive consumption of sugar. This means that to address these issues, the company should think over significant changes in its use of water, energy, plastics and other resources in the products. It has already developed a broad sustainability strategy, a Live Positively that has integrated with the company’s entire business strategy. It deals with the environmental, workplace and societal initiatives. A sustainability strategy evolves supplier partnership as well. The company realizes that sustainability is vital to the business continuity and survival, because of the growing of world populations and consumption of natural resources. That is why the Coke has already set goals of returning as much water to the world as it uses, reducing absolute carbon footprint for manufacturing operations and recovering all its packaging. To achieve these targets, the Coca Cola should go beyond cost-saving operational improvements and increase its products, engaging its stakeholders in rebuild environmental innovation culture (Shapiro, 2010). Moreover, investing five billion dollars in other countries, particularly in India by 2020, the Coca Cola aims to raise its presence this fastest-growing emerging market. It sets goals to spend the money for enhancing the capacity of Indian bottling unit along with the bottling franchisees, expanding distribution and brand building (Gulati & Ahmed, 2012). What is Coca Cola doing to address obesity? As statistics state, two-thirds of the U.S. adults are overweight or suffer obesity (Tinker, 2013). The Coca Cola Company has also recognized that huge problem of people. It has paid its attention to this problem by reinforcing its efforts to collaborate for the well- being of the American community along with the business and government leaders in order to search the solutions to such challenge as obesity. It launched a campaign “Coming together” that states that the company brings people together around the issue called obesity. The launched video offers 180 low and no calorie beverages out of its main beverages. Besides, the new campaign was about beating obesity, basing on one simple statement that all calories count no matter where they come from. Of course, there was a severe critique over the commercials that Coca Cola created, however, this is the way the company shows how it help to deal with the obesity. How does the company go about which people and events to sponsor? While corporations create marketing agreements with different organizations and companies, there are also those who choose individual athletes, celebrities or events to push their products or services. These sponsorships are cheaper and provide an opportunity for companies to link their brand with the personality and her or his accomplishments. While different events and people have special places in the global consciousness, it gives the businesses an opportunity to promote their products using the most successful and the most expected people and events for them. Thus, the Coca Cola is the official sponsor of the American Idol show, Apple iTunes, BET Network, NASCAR, NBA and Olympic Games. References Bicle, M., 2011. What Makes Coca-Cola a World-Wide Phenomenon? Forbes, Available from http://www.forbes.com/sites/prospernow/2011/08/01/what-makes-coca-cola-a-world-wide-phenomenon/ Donelly,L., 2014. Available from Coca Cola in controversy over £20m 'anti-obesity' drive http://www.telegraph.co.uk/health/healthnews/10855425/Coca-Cola-in-controversy-over-20m-anti-obesity-drive.html Gulati & Ahmed, 2012. India Has 1.2 Billion People but Not Enough Drink Coke, The Wall Street Journal, Available from http://online.wsj.com/articles/SB10001424052702304870304577490092413939410 History of Bottling, n.d. The Coca Cola official web site, Available from http://www.coca-colacompany.com/our-company/history-of-bottling Just Chew It: Coca-Cola, 2014. Crikey, the independent media, Available from http://www.crikey.com.au/coca-cola-just-chew-it/ Said, S., 2013. Top 10 Most Popular Coca-Cola Products, The Richest, Available from http://www.therichest.com/rich-list/most-popular/top-10-most-popular-coca-cola-products/ Shapiro, A., 2010. Coca-Cola Goes Green, The Forbes, Available from http://www.forbes.com/2010/01/29/muhtar-kent-coca-cola-leadership-citizenship-sustainability.html Tinker, B., 2013. Coca-Cola weighs in on obesity fight, The CNN, Available from http://edition.cnn.com/2013/01/14/health/coke-obesity/ Zmuda, N. & Parekh, R., 2013. Coca-Cola's Answer to Pepsi's Beyonce? Pop Country Songstress Taylor Swift, The Advertising Age, Available from http://adage.com/article/news/diet-coke-signs-taylor-swift-brand-ambassador/239418/ Zurn, B., n.d. Coca-Cola: The Power Of A Brand, Experience, Available from https://cosd.experience.com/alumnus/article?channel_id=advertising_marketing_pr&source_page=additional_articles&article_id=article_1172770548217 Read More