Coca-Cola Company - Sponsorship Efforts at the 2012 London Olympics - Essay Example

COCA-COLA: Sponsorship efforts at the London Olympics EXECUTIVE SUMMARY Coca-Cola’s Open Happiness campaign is driving the firm’s globalmarketing efforts to reinvigorate the brand and also to establish an identity for the 21st Century (Zmuda, 2009). The markets attending the 2012 London Olympics will be domestic citizens and international citizens of varying demographics and lifestyles. This concept of creating global harmony through Coca-Cola products will be a proper fit among a theme involving ecology and green business as well as diversity found prevalent at the Games. Coca-Cola requires adjustment to this strategy to include its historical foundation of success by using images spanning their advertising history, as well as providing incentives for choosing Coke products. 2. ENVIRONMENTAL ANALYSIS Coca-Cola’s major competition at the Games will be McDonalds and Cadbury, two of the largest foods supporters of the event. In terms of sales competition, these companies are the one to outperform. Smaller competitors will include domestic eateries offering food selections at the Games, however their contribution to competitive success is negligible. 2.1 Swot Analysis Strengths : A well-known global brand with years of awareness and loyalty in multiple consumer segments. Experience in viral marketing and digital marketing using social networks (Benjamin, 2009). Partnership and sponsorship experience with ecology-focused organisations such as World Wide Fund for Nature to promote greener business (Hargrave-Silk, 2008). Multi-segment targeting experience for diverse beverage consumers Weaknesses: Difficult to differentiate beverage products in very competitive environment. Sub-brand marketing strategy for product line marketing. Parent brand focus should be in effect for Olympics. Not much focus on psychographics – High focus on demographic segmentation. Opportunities: Use of celebrity endorsement in Games advertising. Large acceptance by Asian customers (Blecken, 2009). Score more green credentials through promotion More advertising focus on low-calorie beverage products to meet global demand for healthier eating. Threats: Risk of McDonald’s becoming exclusive foods sponsor at Games (Magnay, 2010; sports-city.org, 2010). Games coordinators criticizing fast-food and sugary beverage producers for not providing a plan for healthier eating (foodmagazine.org.uk, 2010; telegraph.co.uk, 2008). Coca-Cola’s designated, physical position amidst different marketers during the Games presentations. The SWOT analysis provides a breakdown of the most important marketing situations affecting Coca-Cola at the 2012 Olympics. 2.2 PEST analysis Political: Criticism stemming from local regulators about business practices with the Games foods sponsors creates new advertising needs, such as reflecting greener business practices or diverse foods offerings. This has forced Coca-Cola to invest considerable funds into different partnerships to reflect their eco-diversity efforts. The administrators of the Games use pressure to coerce new marketing activities to meet perceived social demands. Less administrative control over companies and their marketing efforts, such as new ability to place corporate logos into the 2012 Olympics emblem designed by olympics committees (brandsizzle.com, 2007). Economic: The economic climate is favourable for Coca-Cola, as the Games will support international customers with the tangible resources needed to be part of the events. Coca-Cola products are affordable for any market, in virtually any economic condition. Social: Multiple market groups with a social consciousness toward healthy eating and lower-calorie food trends. They need to be supported and represented. Environmentally-conscious consumer groups “People are passionate about the Olympics and that gives (Coca-Cola) the change to connect with them on a personal, emotional level” (marketinguk.co.uk, 2010, p.1). Intense demand for Olympics represents opportunities to flex new targeting strategies. Technological: The high global use of mobile technologies allows for social networking to occur real-time (such as through Twitter) to report on their experiences at the Games. This technological ability gives Coca-Cola more exposure in online social networking sites. The items identified through PEST analysis reveals the most important factors that might impede marketing success or enhance Coca-Cola’s flexibility related to the Games. 3. SEGMENTING, TARGETING AND POSITIONING Unlike many companies that have diverse products for specific market segments, Coca-Cola’s products are affordable for any market and therefore have more mass-focused strategies than individual group segmentation. Coca-Cola products, their sub-brands, have value to consumers of virtually any socio-economic status and are conveniently priced to have mass group appeal. Demographic segmentation is usually the strategy of choice based on regional ages, incomes, and cultural lifestyles. There is no need for geographic, purchase occasion, or benefit segmentation since sales of Coca-Cola products will be conducted with the audience available during the Games presentations. Psychographic concepts should be included into the segmentation strategy to identify with diverse cultures from Asia, North America, Australia, and Africa. A common consumer need in this environment is thirst, with specific brand selections being the only distinction between what items sell in high volumes. “A soft drink, especially a carbonated one, is a frivolous purchase” (Thomas, 2010, p.17). This categorises soft drinks as convenience products that are there to fill a specific refreshment need with multiple target audiences. Because of the reality of this product in relation to consumer needs, excessive targeting strategies would likely defeat the purpose of gaining consumer attention and also strain the marketing budget for ongoing, separate promotional materials. Therefore, targeting involves creating a singular strategy that will have mass group appeal and can be promoted to diverse audiences of various socio-economic backgrounds. It should have appeal for the older consumer market which is a growing segment in soft drink marketing. Offers Coca-Cola, “To target aging and affluent consumers globally, we are actively exploring new ingredients, new functionality and new occasions” (Stroud, 2009, p.1). Since there will be a fair volume of affluent clients at the Games, all targeted promotional content should be geared around this group’s inclusion. The need for a unified strategy that is relevant for diverse consumers is necessary to achieve competitive or sales success during the Games. Positioning is defined as owning a place in the consumers’ minds, much like a bookmark (Trout, 2008, p.5). Coca-Cola has a very rich history of sales success built on years of targeting and promotion. The key is to position this specific marketing effort to give Coca-Cola a distinct image among competition and also satisfy mass consumer needs. Positioning Coca-Cola as a dedicated company working toward environmental protection, with a twist of historical influence in society, and further blending healthy eating should be an inclusive campaign to position the company as one focused strictly on consumer needs. This option is favourable for this particular venue due to diverse consumer profiles, pressures from external regulators and committees, and a global trend toward ecology that is noticeable on all continents. There is no need to position based on quality, price, or other factors used by competition since these are, in actuality, convenience products difficult to differentiate. Coca-Cola is already developing a hospitality theme for its 2012 sponsorship, considering issues of logistics, pricing, and their own flexibility to deliver on hospitality promises (Bell, 2009). On the back of campaigns such as Open happiness, Coca-Cola can use environmentalism, its own history of advertising images, and alternative beverage offerings (aside from high sugar carbonated drinks), to accomplish a positioning strategy of total corporate diversity. To achieve this positioning, there is less emphasis on product from the marketing mix. With only a few pounds or pennies difference between Coca-Cola beverage brands, product only serves as a refreshment tool and not a competitive beverage. Other companies will be highlighting their own drink offerings with their own positioning strategy to ensure higher sales. Coca-Cola should focus less on this aspect of the marketing mix. Pricing should not be very transparent to buyers either, as to emphasize price gives the perception that this is not a convenience product but has become a high-involvement decision. The diverse consumer segments should be selecting Coca-Cola based on its name, not its price tag. The company now boasts 3,000 different beverages (Coca-Cola, 2008). Place is highly important as the company needs enough physical space to ensure high consumer traffic and should be displayed prominently on all vendors offering Coca-Cola beverages. Ensuring less consumer line-ups at various booths will also ensure a positive perception of the brand for convenience focus, thus a need for strategically-placed vending systems. Promotion is the key element to success in this venture. The following section describes a promotional programme to build higher consumer interest and outperform other foods offerings. 4. ADVERTISING CAMPAIGN Coca-Cola should embrace its historical successes by taking various advertising images from 1912 through 2012 to show its 100 + years legacy as a convenience-oriented company. With only £10,000 pounds, the majority of this budget will be put toward on-site promotional materials (print, banners, use of monitors). Illustrating the traditional flapper from the 1920’s, along with consumers wearing clothing from the 1950’s, and a modern illustration of the Asian consumer for 2012 can be placed on banners bearing the Coca-Cola name to show their evolution through history. The most modern picture can have a prominently displayed recycling graphic next to the image to reinforce commitment to environment. Along with these materials should be more focus on Diet Coke and other diet soft drinks or low-calorie beverages that fulfills consumer demand for healthier eating and need for energy. Vendor usage of monitors displaying a corporately-produced montage of Diet Coke advertisements will reinforce its social value while waiting in line for Coca-Cola products. Using historical celebrity endorsements to fit in the positioning theme negates the need for added budget for new celebrity usage. These old advertisements using celebrity (or other actors) will remind consumers of the company’s longevity as a social organisation. A “Find the Flapper” contest should be included on specially-marked Coca-Cola drinks that offers a suitable prize (collected on-site by the winner). A batch run of drink cups with a pull-down tab in search of a 1920’s flapper actor will reinforce longevity and build interest in buying more Coca-Cola products. The per-activity cost of producing these materials will not over-run the 10,000 budget. Gantt chart for timeline Action Month/2010 May Jun Jul Aug Sep Oct Nov Dec Coordinate Banner Ads Coordinate Flapper Batch Run Compile Coke Advertisement Social Networking Presence Publish Booth Ads Coordinate Press Agent Finalize agreements with Olympics Committee Leaflets printed Audit of printed campaign materials References: Bell, L. 2009, Coca-Cola on…its Olympics events plan. http://www.citmagazine.com/news/rss/886432/Coca-Cola-on-its-Olympics-events-plan/ (accessed April 9, 2010). Benjamin, K. 2009, Battle of the brands, Revolution, London. November, pp.51-54. Blecken, D. 2009, Coke’s impresario set to build on music platform, Media, Hong Kong. November 5, p.13. Coca-Cola. 2008, The Coca-Cola Company 2008 Annual Review. Buy. Drink. Smile, p.24. http://www.thecoca-colacompany.com/investors/pdfs/2008_annual_review/2008_annual_review.pdf (accessed April 7, 2010). Hargrave-Silk, A. 2008, Can a brand grow and be green at the same time?, Media, Hong Kong. November 13, p.23. Magnay, J. 2010, London 2012: Food-growing on the menu for Olympic site. http://www.telegraph.co.uk/sport/othersports/olympics/london2012/7583221/London-2012-Food-growing-on-the-menu-for-Olympic-site.html (accessed April 7, 2010). Sports-city.org. 2010, McDonald’s could be the exclusive 2012 Olympics food brand. http://www.sports-city.org/news_details.php?news_id=9021&idCategory=1 (accessed April 10, 2010). Stroud, D. 2009, 50-plus marketing: Coca-Cola is targeting just about everybody. http://20plus30.blogspot.com/2009/11/coca-cola-is-targeting-just-about.html (accessed April 8, 2010). Telegraph.co.uk. 2008, Olympics minister under fire for criticising junk food sponsors of 2012 London Games. http://www.telegraph.co.uk/sport/3546502/Olympics-minister-under-fire-for-criticising-junk-food-sponsors-of-2012-London-Games.html (accessed April 8, 2010). Thomas, J. 2010, Diet Coke’s split personality, Marketing, London. February 24, p.17. Trout, J. 2008, The new positioning: the latest on the world’s #1 business strategy, Genii Group. http://www.genii-group.com/pdf/Book_Review_The_New_Positioning.pdf (accessed April 8, 2010). Zmuda, N. 2009, Pepsi, Coke try to outdo each other with rays of sunshine, Advertising Age, 80(2), p.6. Read More