SWOT ANALYSIS OF

COCA-COLA
S
TW
O
T

A
N
A
L
Y
S
I
S
Fig 2.1 SWOT ANALYSIS OF COCA-COLA

STRENGTHES:
WORLDS LEADING BRAND
Coca-Cola has strong brand recognition across the globe. The company has a leading brand
value and a strong brand portfolio. Business-Week and Inter-brand, a branding consultancy,
recognize. Coca-Cola as one of the leading brands in their top 100 global brands ranking in
2006.The Business Week-Inter-brand valued Coca-Cola at $67,000 million in 2006. CocaCola ranks well ahead of its close competitor Pepsi which has a ranking of 22 having a brand
value of $12,690 million Furthermore; Coca-Cola owns a large portfolio of product brands.

The company owns four of the top five soft drink brands in the world: Coca-Cola, Diet Coke,
Sprite and Fanta.
Strong brands allow the company to introduce brand extensions such as Vanilla Coke, Cherry
Coke and Coke with Lemon. Over the years, the company has made large investments in
brand promotions. Consequently, Coca-cola is one of the best recognized global brands. The
companys strong brand value facilitates customer recall and allows Coca-Cola to penetrate
new markets and consolidate existing ones.

LARGE SCALE OF OPERATIONS

With revenues in excess of $24 billion Coca-Cola has a large scale of operation. Coca-Cola is
the largest manufacturer, distributor and marketer of non-alcoholic beverage concentrates and
syrups in the world. Coco-Cola is selling trademarked beverage products since the year 1886
in the US. The company currently sells its products in more than 200 countries. Of the
approximately 52 billion beverage servings of all types consumed worldwide every day,
beverages bearing trademarks owned by or licensed to Coca-Cola account for more than 1.4
billion.
The companys operations are supported by a strong infrastructure across the world. CocaCola owns and operates 32 principal beverage concentrates and/or syrup manufacturing
plants located throughout the world.
In addition, it owns or has interest in 37 operations with 95 principal beverage bottling and
canning plants located outside the US. The company also owns bottled water production and
still beverage facilities as well as a facility that manufactures juice concentrates. The
companys large scale of operation allows it to feed upcoming markets with relative ease and
enhances its revenue generation capacity.

ROBUST REVENUE GROWTH IN 3 SEGMENTS

Coca-Colas revenues recorded a double digit growth, in three operating segments. These
three segments are Latin America, East, South Asia, and Pacific Rim and Bottling
investments. Revenues from Latin America grew by 20.4% during fiscal 2006, over 2005.

During the same period, revenues from East, South Asia, and Pacific Rim grew by 10.6%
while revenues from the bottling investments segment by 19.9%.
Together, the three segments of Latin America, East, South Asia and Pacific Rim
bottling investments, accounted for 34.8% of total revenues during fiscal 2006. Robust
revenues growth rates in these segments contributed to top-line growth for Coca-Cola during
2006.

WEAKNESS:
NEGATIVE PUBLICITY
The Coca-Cola Company has been involved in a number of controversies and lawsuits related
to its relationship with human rights violations and other perceived unethical practices. There
have been continuing criticisms regarding the Coca-Cola Company's relation to the Middle
East and U.S. foreign policy. The company received negative publicity in India during
September 2006.The company was accused by the Centre for Science and Environment
(CSE) of selling products containing pesticide residues. Coca-Cola products sold in and
around the Indian national capital region contained a hazardous pesticide residue.

On 10 December 2008, the US Food and Drug Administration (FDA) wrote to Mr. Muhtar
Kent, President and Chief Executive Officer, to warn him that the FDA had concluded that
Coca-Cola's product Diet Coke Plus 20 FL OZ was is in violation of the Federal Food, Drug,
and Cosmetic Act.
In January 2009, the US consumer group the Centre for Science in the Public Interest filed a
class-action lawsuit against Coca-Cola. The lawsuit was in regards to claims made, along
with the company's flavours, of Vitamin Water. Claims say that the 33 grams of sugar are
more harmful than the vitamins and other additives are helpful.

SLUGGISH PERFORMANCE IN NORTH AMERICA

Coca-Colas performance in North America was far from robust. North America is CocaColas core market generating about 30% of total revenues during fiscal 2006. Therefore, a
strong performance in North America is important for the company.

In North America the sale of unit cases did not record any growth. Unit case retail volume in
North America decreased 1% primarily due to weak sparkling beverage trends in the second
half of 2006 and decline in the warehouse-delivered water and juice businesses. Moreover,
the company also expects performance in North America to be weak during 2007. Sluggish
performance in North America could impact the companys future growth prospects and
prevent Coca-Cola from recording a more robust top-line growth.

DECLINE IN CASH FROM OPERATING ACTIVITIES

The companys cash flow from operating activities declined during fiscal 2006. Cash flows
from operating activities decreased 7% in 2006 compared to 2005. Net cash provided by
operating activities reached $5,957 million in 2006, from $6,423 million in 2005. CocaColas cash flows from operating activities in 2006 also decreased compared with 2005 as a
result of a contribution of approximately $216 million to a tax-qualified trust to fund retiree
medical benefits.
The decrease was also the result of certain marketing accruals recorded in 2005.Decline in
cash from operating activities reduces availability of funds for the companys investing and
financing activities, which, in turn, increases the companys exposure to debt markets and
fluctuating interest rates.

OPPORTUNITIES:
ACQUISITIONS
During 2006, its acquisitions included Kerry Beverages, (KBL), which was subsequently,
reappointed Coca-Cola China Industries (CCCIL). Coca-Cola acquired a controlling
shareholding in KBL, its bottling joint venture with the Kerry Group, in Hong Kong.
The acquisition extended Coca-Colas control over manufacturing and distribution joint
ventures in nine Chinese provinces.

In Germany the company acquired Apollinaris which sells sparkling and still mineral water.
Coca-Cola has also acquired a 100% interest in TJC Holdings, a bottling company in South
Africa. Coca-Cola also made acquisitions in Australia and New Zealand during 2006. These
acquisitions strengthened Coca-Colas international operations.
These also give Coca- Cola an opportunity for growth, through new product launch or greater
penetration of existing markets. Stronger international operations increase the companys
capacity to penetrate international markets and also gives it an opportunity to diversity its
revenue stream. On 25 February 2010, Coco cola confirms to acquire the Coca cola
enterprises (CCE) one the biggest bottler in North America. This strategy of coca cola
strengthens its operations internationally.

GROWING BOTTLED WATER MARKET

Bottled water is one of the fastest-growing segments in the worlds food and beverage market
owing to increasing health concerns. The market for bottled water in the US generated
revenues of about $15.6 billion in 2006.
Market consumption volumes were estimated to be 30 billion litres in 2006. The market's
consumption volume is expected to rise to 38.6 billion units by the end of 2010. This
represents a CAGR of 6.9% during 2005-2010.
In terms of value, the bottled water market is forecast to reach $19.3 billion by the end of
2010. In the bottled water market, the revenue of flavoured water (water-based, slightly
sweetened refreshment drink) segment is growing by about $10 billion annually. The
companys Dasani brand water is the third best-selling bottled water in the US. Coca-Cola
could leverage its strong position in the bottled water segment to take advantage of growing
demand for flavoured water.

GROWING HISPANIC POPULATION IN U.S

Hispanics are growing rapidly both in number and economic power. As a result, they have
become more important to marketers than ever before. In 2006, about 11.6 million US
households were estimated to be Hispanic. This translates into a Hispanic population of about
42 million.

The US Census estimates that by 2020, the Hispanic population will reach 60 million or
almost 18% of the total US population. The economic influence of Hispanics is growing even
faster than their population. Nielsen Media Research estimates that the buying power of
Hispanics will exceed $1 trillion by 2008- a 55% increase over 2003 levels.
Coca-Cola has extensive operations and an extensive product portfolio in the US. The
company can benefit from an expanding Hispanic population in the US, which would
translate into higher consumption of Coca-Cola products and higher revenues for the
company.

THREATS:
INTENSE COMPETITION
Coca-Cola competes in the non-alcoholic beverages segment of the commercial beverages
industry. The company faces intense competition in various markets from regional as well as
global players. Also, the company faces competition from various non-alcoholic sparkling
beverages including juices and nectars and fruit drinks. In many of the countries in which
Coca-Cola operates, including the US, PepsiCo is one of the companys primary competitors.
Other significant competitors include Nestle, Cadbury Schweppes, Groupe DANONE and
Kraft Foods.
Competitive factors impacting the companys business include pricing, advertising, sales
promotion programs, product innovation, and brand and trademark development and
protection. Intense competition could impact Coca-Colas market share and revenue growth
rates.

DEPENDENCE ON BOTTLING PARTNERS

Coca-Cola generates most of its revenues by selling concentrates and syrups to bottlers in
whom it doesnt have any ownership interest or in which it has no controlling ownership
interest. In 2006, approximately 83% of its worldwide unit case volumes were produced and
distributed by bottling partners in which the company did not have any controlling interests.
As independent companies, its bottling partners, some of whom are publicly traded
companies, make their own business decisions that may not always be in line with the

companys interests. In addition, many of its bottling partners have the right to manufacture
or distribute their own products or certain products of other beverage companies.
If Coca-Cola is unable to provide an appropriate mix of incentives to its bottling partners,
then the partners may take actions that, while maximizing their own short-term profits, may
be detrimental to Coca-Cola. These bottlers may devote more resources to business
opportunities or products other than those beneficial for Coca-Cola. Such actions could, in
the long run, have an adverse effect on Coca-Colas profitability.
In addition, loss of one or more of its major customers by any one of its major bottling
partners could indirectly affect Coca-Colas business results. Such dependence on third
parties is a weak link in Coca-Colas operations and increases the companys business risks.

SLIGGISH GROWTH OF CARBONATED BEVERAGES

US consumers have started to look for greater variety in their drinks and are becoming
increasingly health conscious. This has led to a decrease in the consumption of carbonated
and other sweetened beverages in the US. The US carbonated soft drinks market generated
total revenues of $63.9 billion in 2005, this representing a compound annual growth rate
(CAGR) of only 0.2% for the five-year period spanning 2001-2005. The performance of the
market is forecast to decelerate, with an anticipated compound annual rate of change (CAGR)
of -0.3% for the five-year period 2005-2010 expected to drive the market to a value of $62.9
billion by the end of 2010.
Moreover in the recent years, beverage companies such as Coca-Cola have been criticized for
selling carbonated beverages with high amounts of sugar and unacceptable levels of
dangerous chemical content, and have been implicated for facilitating poor diet and
increasing childhood obesity. Moreover, the US is the companys core market. Coca-Cola
already expects its performance in the region to be sluggish during 2007. Coca-Colas
revenues could be adversely affected by a slowdown in the US carbonated beverage market.

RESEARCH
METHODOLOGY

OBJECTIVES OF THE STUDY

The main objective of the project is to analyze and study in efficient way the current
position of Coca- Cola Company.
To perform PESTLE and SWOT analysis of Coca-cola globally as well as locally.
This would help us identify areas of potential growth.
The study was aimed to perform Market Analysis of Coca-Cola Company & find out
different factors effecting the growth of Coca-Cola.
Another objective of the study was to perform Competitive analysis between CocaCola and its competitors.
To understand the reasons behind the purchase of Coca-Cola products.

SCOPE OF THE STUDY:This study basically tries to discover the current position of Coca-cola in the market. It
also tries to discover the preferences of the customers when posed with a choice between
Coca-Cola and Pepsi. It is primarily directed to the general public but was done only in
North delhi,

RESEARCH DESIGN

A research design is the specification of methods and procedures for acquiring the needed
information. It is overall operational pattern or framework of the project that stipulates what
information is to be collected from which source by what procedure.
There are three types of objectives in a marketing research project:

Exploratory Research.
Descriptive Research.
Casual Research.

1. Exploratory Research:The objective of exploratory research is to gather preliminary information that will help
define problems and suggest hypothesis.

2. Descriptive Research:The objective of descriptive research is to describe things, such as the market potential for
a product or the demographics and attitudes of consumers who buy the product.

3. Casual Research:The objective of casual research is to test hypothesis about casual and effect relationships.

Based on the above definitions it can be established that this study is a Descriptive Research
as the attitudes of the customers who buy the products have been stated. Through this study
we are trying to analyze the various factors that may be responsible for the preference of
Coca-Cola products.

SOURCES OF DATA
The data has been collected from both primary as well as secondary sources.

SECONDARY DATA:It is defined as the data collected earlier for a purpose other than one currently being pursued.
As a researcher I have scanned lot of sources to get an access to secondary data which have
formed a reference base to compare the research findings. Secondary data in this study has
provided an insight and forms an outline for the core objectives established.

The various sources of secondary data used for this study are:

News papers.
Magazines.
Text books.
Marketing reports of the company.
Internet.

PRIMARY DATA:The primary data has been collected simultaneously along with secondary data for
meeting the established objectives to provide the solution for the problem identified in
this study.
The methods that have been used to collect the primary data are: Questionnaire.
Personal Interview.

RESEARCH MEASURING TOOLS & TECHNIQUES

The primary tool for the data collection used in this study is the respondents response to the
questionnaire given to them. The various research measuring tools used are:

Questionnaire.
Personal interview.
Tables.
Percentages.
Pie-charts.
Bar-charts.
Column charts.

SAMPLING DESIGN
An integral component of a research design is the sampling plan. Especially it addresses three
questions: Whom to survey (sample Unit), how many to survey (Sample Size) and how to
select them (sampling Procedure). Making the census study of the entire universe will be

impossible on the account of limitations of time and money. Hence sampling becomes
inevitable. A sample is only his portion of population. Properly done, sampling produces
representative data of the entire population.

FIELD WORK:The study was conducted in North delhi, Noida and .

The questionnaires were given to the respondents to fill in order to get their feedback.
Questions were read out to the respondents and the answers were noted.

LIMITATIONS OF THE STUDY:The main purpose of this study is get idea about the preference of the customers towards
various Coca-Cola products. But there are certain factors which affects this study they are as
follow:
Since the sampling procedure was judgmental, the sample selected may not be true
representative of the population.
Economic and market conditions are very unpredictable (Present and future).
The project duration is limited to 4 weeks so it limits the area of study.
The study was confined to North delhi, Noida and due to which the result cannot be
applied universally.

DATA ANALYSIS

Respondents based on age group

180
160
140
120
100
80
60
Number of respondents
40
20
0

Fig 2.4

Respondents based on gender

37%

Male
63%

Female

Fig 2.5

AGE GROUP & GENDER:

From Fig 2.4, we can comprehend that 90% of total respondents belong to the age group of
20-30. This is because most of the consumers that prefer or consume Coca-Cola products
belong to this age group. About 6% belong to age group below 20 and 3% belong to age
group of 30-40.Form Fig 2.5, we come to know that the gender ratio of the total respondents
is almost 2:1 (male: female).

Frequency of soft drink consumption

50
45
40
35
30
25
20
15
10
5
0

Fig 2.6

Weekly expenditure of coca-cola products (INR)

12%

50-100

4%3%

100-150
150-200
81%

Above 200

Fig 2.7

SOFT DRINK CONSUMPTION & EXPENDITURE:

From Fig 2.6, we interpret that about 48% of the total respondents consume soft drinks rarely
or once a week. About 35% respondents consume soft drinks twice or thrice a week and only
18% consumes soft drinks every day.
From Fig 2.7, we interpret that about 81% of the respondents spend only Rs. 50-100 a week
on Coca-Cola products, which is very low as compared to the global scenario. This creates a
potential growth market for Coca-Cola India. About 12% spends from 100-150 a week & 7%
spend above 150.

Purchasing Portal Preference

120
100
80
60
40
20
0

Fig 2.8

PURCHASING PORTAL PREFERENCE:

From the above data, we have ascertained that preferred portal for purchase of Coca-Cola
products is the retail shops i.e. 58%. This is probably because not all communities in India
have supermarkets and other purchasing channels present nearby, whereas, we can find retail
shops in every corner.19% prefer to purchase from Supermarkets and Vendor machines. 23%
prefer to purchase from Pubs, Restaurants and Multiplexes.

Occasions/Reasons for consumption

Just like that

Parties

Cinemas

Picnics

Festivals
0

20

40

60

80

100

120

Number of respondents

Fig 2.9

REASON FOR CONSUMPTION:

From this graph, we infer that there is no specific occasion why people purchase Coca-Cola
products. Although some of the advertising campaigns target special occasion or festivals.
From Fig 2.9 it is concluded that 59% respondents purchase Coca-Cola without any specific
reason. About 23% purchase for the purpose of parties, 15% purchase while watching movies
in the cinemas and only about 4% purchase during festivals and for picnic purposes.

Soft drink preference

80
70
60
50
40
30
Number of responses

20
10
0

Fig 2.10

SOFT DRINK PREFERENCE:

From the above graph we interpret that about 70% of the respondents, prefer consuming
Coca-Cola product over Pepsi and other drinks. This clearly states why Coca-Cola is market
leader with almost 60% of market share. 23% prefer Pepsi Products and only 75 prefer other
drinks.

Opnion About Coca-Cola Products

Bad
Below Satisfactory
Satisfactory
Good
Excellent
0

20

40

60

80

100

120

NO. OF RESPONDENTS

Fig 2.11

Products expected by consumers from Coca-Cola

Fizzy drinks

Fruit drinks

20%

Energy drinks

Alcoholic drinks

14%

27%

40%

Fig 2.12

OPINION ABOUT COCA-COLA PRODUCTS

& PRODUCTS EXPECTED BY CONSUMERS:
From Fig 2.11, we infer that though the respondents are more than satisfied by the Coca-Cola
product range they would still like the company to introduce new drinks. From Fig 2.12, we
conclude that about 40% would like to see a new fruit drink being added to the product
basket, 26% want energy drinks, 20% alcoholic drinks and only 14% want another fizzy
drink. Majority of the people wanting to see a fruit drink is mainly because people are more
health conscious now and want to manage their calorie intake.

Quantity preference
90
80
70
60
50
40
30
Number of responses

20
10
0

Fig 2.13

QUANTITY PREFERENCE:
From Fig 2.13, we infer that about 47% of respondents prefer to purchase PET bottle of
Coca-Cola Products. About 27% prefer to purchase glass bottles, 19% prefer Can of 300ml
and only 8% prefer 1 & 2 litre bottles of Coca-Cola.

Branding
Pepsi products

Coca-Cola products

20

40

60

80

100

120

NO. OF RESPONDENTS

Fig 2.14

Pricing
120
100
80
60
40
20
0

Coca-Cola products

Pepsi products

Fig 2.15

BRANDING & PRICING:

From Fig 2.14, it is concluded that respondents find Coca-Cola products better than that of
Pepsi products. About 62% respondents said that they find Coca-cola products better than
Pepsi and only 38% supported Pepsi products.
From Fig 2.15, we infer that about 62% of the respondent considers the pricing of Coca-Cola
much more reliable than that of Pepsi. About 38% respondents think that Pepsi have better
pricing than that of Coca-Cola.

Quality
140
120
100
80
60
40
20
0

Coca-Cola products

Pepsi products

Fig 2.16

TASTE

Pepsi products

Coca-Cola products
0

20

40

60

80

100

120

140

NO. OF RESPONDENTS

Fig 2.17

QUALITY & TASTE:

From Fig 2.16 & 2.17, its clear that Coca-Cola products have better taste and quality than
that of Pepsi. About 73% respondents consider that Coca-Cola products have very good
quality and taste. 27% respondents consider Pepsi products have better taste and quality.

Availability
Pepsi products

Coca-Cola products

85.5 86 86.5 87 87.5 88 88.5 89 89.5 90

Number of respondents

Fig 2.18

Satisfaction

Pepsi products

Coca-Cola products

20

40

60

80

100

120

140

Fig 2.19

AVAILABILITY & SATISFACTION:

From Fig 2.18, its clear that there is slight difference between the availability of products of
Coca-Cola and Pepsi. About 51% respondents think that Coca-Cola products are much easily
available in the market.49% consider that availability of Pepsi products is more in the market.
About 70% of respondents are satisfied with the Coca-Cola products while as 30%
respondents are satisfied with the Pepsi products as shown in Fig 2.19.

SUGGESTIONS
AND
CONCLUSION

SUGGESTIONS
The suggestions made in this section are based on the market study conducted as part of
Coca-Cola India. The suggestions are arranged in order of priority, highest first.
Perform a detail demand survey at regular interval to know about the unique needs
and requirements of the customer.
The company should make hindrance free arrangement for its customers/retailers to
make any feedback or suggestions as and when they feel.
The company should focus to bring some more flavors like health drinks and other
low-calorie offerings. Coca-Cola India can also introduce some fruit based drinks, as
it has already entered the energy drink arena with Burn.
Coca-Colas distribution channel is mostly through retail. Whereas the competitors
also concentrates more on the multiplexes, pubs and restaurants. Coca-Cola should try
to increase their distribution in these areas.
The company must keep a watch on its primary competitors in market in order to be
able to compete with them.
The company should use new attractive system of word of mouth advertisement to
keep alive the general awareness in the whole market as a whole.
The company should be always in a position to receive continuous feedback and
suggestions from its customers/ consumers as well as from the market and try to
solve it without any delay to establish its own good credibility.
A strong watch should be kept on distributors so that the goodwill of the BRAND
doesnt get affected.

CONCLUSION
Though there were certain limitations in the study that was conducted. The sample allowed
for some conclusions to be drawn on the basis of analysis that was done on the data collected.

The data has clearly indicated that Coca-Cola products are more popular than the products
of Pepsi mainly because of its TASTE, BRAND NAME, INNOVATIVENESS and
AVAILABILITY, thus it should focus on good taste so that it can capture the major part of
the market. The study also indicated that the consumers are satisfied with the Coca-Cola
products and purchase them without any specific occasions.
In todays scenario, customer is the king because he has got various choices around him. If
you are not capable of providing him the desired result he will definitely switch over to the
other provider. Therefore to survive in this cutthroat competition, you need to be the best.
Customer is no more loyal in todays scenario, so you need to be always on your toes.

About the Project

The fourty days internship project at Moon Beverages Private
Limited involved survey on consumer buying preferences of
beverages perceived by retailers in Delhi and RTM

processes(Road
satisfaction.

to

market),

thereby

The following observations

delivery route visits:

were

improving

made

customer

during

the

Total number of outlets visited (across 5 routes): 80

Average time spent per outlet: 15 min (avg)
Range of outlets covered per day for order taking: 10 to 24
Range of start time for daily order taking activity: 8 am 10
am
Range of end time for daily order taking activity: 5 pm to 7
pm