2016 was a challenging year for the carbonated soft drinks (CSD) market in the US which has declined for nine straight years, largely due to a decline in soda sales, part of a long-term trend that has seen total sales and volume of sugary sodas consumed decline for 11 consecutive years, as consumer worries over use of high calorie sugars and artificial sweeteners escalate. Even sales for diet sodas, supposed to be the industry saviours, continue to dip primarily due to increased scepticism of artificial sweeteners such as aspartame, a controversial artificial sweetener often used in diet colas. Diet sodas sold by both The Coca-Cola Company and rival Pepsico posted steep volume declines last year as consumers opted for healthier options. 2016 sales for Diet Coke fell by 4.3% from the previous year while Diet Pepsi was down by 9.2%. With carbonated drinks losing market share to non-carbonated drinks especially bottled mineral water, Coca-Cola is seeking to remake its portfolio under new CEO James Quincey, with strategic emphasis being placed on what American consumers are actually drinking such as bottled water or very small mini soda cans. In the following report, we will identify the major drivers of change behind Coca Cola’s external environment looking at the general trends driving the soft drinks industry in general. This will help us understand how The Coca Cola Company can utilise its brand competencies so as to take advantage of macro environmental opportunities while at the same time neutralising emerging threats that are chipping away at its success.
Coca Cola Business Strategy Case Study
Key Learning Outcomes
- Understand the broad macro-environment of Coca Cola and the global food and beverage industry in terms of political, economic, social, technological, environmental and legal factors (PESTEL/PEST/STEEPLE).
- Use our swot analysis example to gain an overall understanding of Coca Cola's strengths and weaknesses and strategic options arising from the opportunities and threats that have been identified from the Pestle analysis example on it's business environment.
- To apply strategy business models and frameworks such as Pestle/Pest/Steeple, Swot etc to real company cases.
Analyse the internal and external environment of Coca Cola using SWOT, PORTERS FIVE FORCES, BCG & PESTLE
The Coca-Cola Company is an American based multinational corporation that is engaged in the manufacture, retailing and marketing of more than 500 non-alcoholic beverage brands including the iconic Coca Cola. Founded in 1892, the company is headquartered in Atlanta, Georgia overseeing a franchised business model where it makes the famed Coca Cola syrup concentrate which it then sells to more than 300 bottling partners located around the world. Revenue for the year ended 31st December 2016 was US$41.863billion on operating income (before tax) of US$8.136billion. Of the more than 500 brands The Coca-Cola Company owns, 21 generate annual retail revenue in excess of US$1billion (Annual Review 2016). Interbrand, the global brand consultancy ranked the Coca Cola brand 3rd in the 2016 rankings for “Best Global Brands” after Apple and Google assigning it a brand value of US$73billion (Interband 2016).
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