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| Source: LinkedIn |
Coca-Cola is one of the most recognizable brands. Cola’s brand equity is one of the strongest in the world. Brand loyalty of Coca-Cola and its quality reinforce the image of The Coca-Cola brand. The company has remained in its position for more than a century. Even though the packaging and corporate identity of Coca-Cola have changed over time, the lineage remains strong. Here we will identify how Coca-Cola has maintained its presence with SWOT analysis.
Strengths
1. Huge Distribution Network: The company’s huge distribution network allows it to reach more customers. Its wide audience helps in increasing brand awareness and easily introducing new products.
2. Brand Recognition: Coca-Cola can influence consumers’ buying decisions through its enormous brand recognition. Its marketing campaigns get endorsed by celebrities such as Aamir Khan, Priyanka Chopra, and Akashya Kapoor.
3. Huge Portfolio: Coca-Cola India has one of the most extensive beverage portfolios. The company offers beverages in 7 beverage categories:
1. Carbonated Soft Drinks
2. Bottled Water
3. Juice & Juice Drinks
4. Sports Drinks
5. Tea & Coffee
6. Energy Drinks & Shots
7. Alternative Drinks
As a result, the company depends on lesson one or two of its beverages to generate the majority of its revenue. There are various beverage drinks in different flavors. They easily satisfy every consumer's tastes. Also, Diet Coke has been a great bonus for the brand.
Source: Medium
4. Power over Suppliers: Coca-Cola exercises market power over suppliers by lowering their prices. It uses its size to affect the competition by underpricing some of its items.
5. Franchise: Coca-Cola has 27 wholly-owned bottling operations. It is Supplemented by 17 franchisee-owned bottling operations. A Network of 29 contract packers is used to manufacture a range of products for the company.
6. Loyal Customer base: Coca-Cola has built customers who remain loyal to the brand. Products like Coca-Cola and Fanta are among people's favorites. Since Coca-Cola has a unique taste that cannot be replicated, there are no alternatives for it.
Weakness
1. Carbonated drink: Coca-Cola is the biggest Carbonated Beverage producer. Carbonated drinks are the biggest source of sugar intake. It results in grave health issues such as obesity and diabetes. The business environment is changing and people are taking action to make sure they don’t get obese. So, people might prefer healthier alternatives.
2. Global Warming: Coca-Cola is one of the world’s largest consumer brands that contributes immensely to global warming. Carbon emissions by using throwaway plastic bottles cause harm to the environment.
3. Competitor Pepsi: Pepsi for Coca-Cola has been a pain in the flesh. Coca-Cola would have been the strong market leader if there was no Pepsi. The rivalry between these two brands is always intense and strong. Pepsi has diversified into the snacks segment with products such as Lays and Kurkure. It gets strong revenue for Pepsi. Coca-Cola hasn't.
4. Water problems: Coca-Cola has been getting flak in the past because of its water control problems. Several groups raised lawsuits in the name of Coca-Cola due to their vast water consumption in water-scarce regions. At the same time, people also blamed Coca-Cola for mixing pesticides to clear contaminants in the water.
5. Negative publicity: The largest Coca-Cola plant in Kerala is accused of putting thousands of farmers out of work by draining the water. This water feeds their wells, and the company is poisoning the land with their waste. This is causing negative publicity for the brand.
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| Source: Adweek |
Opportunities and Threats
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| Source: SlidePlayer |
Opportunities
1. New Products: Coca-Cola has the opportunity to introduce new products to diversify its segments. It can enter the food and snacks segment like Pepsi to increase its revenue. This will help the brand to stand out from carbonated drinks. Coca-Cola owns several packaged drinking water brands such as Kinley. It can expand in this segment by adding healthy drinks for the consumers.
2. Developing Nations: Coca-Cola can increase its presence in developing countries. Countries with hot climates have a high consumption level of cold drinks. Increasing its presence in emerging markets such as the Middle Eastern and Africa will be beneficial.
3. Distribution: Coca-Cola’s business is dependent upon logistics and supply chain. Fuel prices and Trans[portation costs are always on the rise. There is an opportunity for the brand to introduce improved systems for its distribution process.
4. Expanding through Acquisition: Quick entry into the markets provides a challenge for global brands. Coca-Cola has recently acquired Costa Coffee. This has driven the growth of the brand.
Threats
1. Water Usage: Coca-Cola has consistently been facing criticism over its water management. People believe the company is exploiting the water-scarce regions by polluting the water with pesticides.
2. Plastic Pollution: Coca-Cola is singled out for misleading the public about single-use plastic bottles. A lawsuit was filed against the company bringing negative publicity.
3. Competition: The brand faces both direct and indirect competition from its competitors. Pepsi is the top competitor while Starbucks, Nescafe, and Lipton juices are indirect competitors. These combined can be a threat to the brand's position in the market.
4. Pandemic: Covid has negatively affected the business. Economic uncertainty has been caused over the last two years. Coca-Cola's revenue declined drastically because restaurants and theaters contribute half of its revenue.
5. Health Consciousness: There is an increase in the healthy lifestyle around the globe. People are becoming more health-conscious and are going for healthy drinks. This might be a big threat for Coca-Cola in the future as consumers are migrating to healthier options.
Closure
Coca-Cola has managed to create strong brand recognition for itself. With its innovative marketing campaigns, Coca-Cola has acquired a huge geographical consumer base. Hopefully, it can satisfy their thirst in the future.
Written by Garima Jain
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