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IQRA UNIVERSITY
Assignment on
SUBMITTED TO
Prepared by
S.MUJTABA.A.AZAM
SAQIB MALIK
FAIZAN SALEEM
WAQAS ARSHAD
HIRA ARSHAD
IQRA UNIVERSITY
REPORT ON RC COLA
ACNOWLEDGEMENTS
We would like to express our whole hearted thanks to Almighty Allah by whose grace &
blessings we have the knowledge, insight and opportunity to complete this report.
We are great to our teacher Mr. Ishaq Shaikh for giving us a chance to make this report.
We have learned a lot through our experience of visiting Continental Beverages Ltd. and
gathering information for our report. Not only this, we have become more familiar with
the concepts of marketing and how these concepts, which we learned in the marketing
course, are being applied in the practical world.
We are also very thankful to Mr. Fasyyal Iqbal Khan (Executive Director of Continental
Beverages Ltd.) for his time and guidance without which our report would not have been
completed.
We would also like to thank all the people who guided us in making this report. We are
sure that this experience and activity will prove beneficial for us in the future.
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REPORT ON RC COLA
OBJECTIVE
We were given the task of revitalizing a product which has not been successful to occupy
its desired place in the market. We selected RC Cola to revitalize. Actually, it is not a
failure product. It was failed to occupy a desired place in the market just because of the
companys financial problems.
Our aim is to help Continental Beverages by giving our opinion about their marketing
strategies. We have disused the segmentation, targeting and Marketing Mix for RC Cola
and also gave suggestion along with it.
We want to introduce RC Cola with a new packaging and image in the market. We try our
best to give some promotional ideas and hope that prove to be beneficial for the company.
IQRA UNIVERSITY
REPORT ON RC COLA
Since its launch in 1905, RC Cola has been a soft drink that embodies individuality and
entrepreneurial spirit. RC's crisp, clean taste distinguishes it from other colas, and has
become a favorite of cola drinkers throughout America.
RC originated in Columbus, Ga., when a young pharmacist named Claud A. Hatcher
decided to supply his family's grocery store with drinks that he produced and bottled.
Hatcher called his first line of beverages "Royal Crown," and the first cola product
"Chero-Cola." Other early products included Royal Crown Ginger Ale, Royal Crown
Strawberry and Royal Crown Root Beer.
Sales grew steadily and in 1912 Hatcher's basement bottling activities grew into the
Chero-Cola Co. Sixteen years later, he renamed the company Nehi Corporation, after the
successful line of fruity beverages he had developed.
After Hatcher's death in 1933, Vice President H.R. Mott took control of the company and
quickly streamlined operations to make the company debt-free within the year. Part of
Mott's plan was the reformulation of the classic Chero-Cola into a more refreshing
beverage. Chemist Rufas Kamm was given the responsibility of coming up with the new
flavor, which took six months to perfect. The new cola was released to the public with
the name of Hatcher's original line of beverages: Royal Crown.
Royal Crown Cola was an instant sensation. RC Cola, as it is now called, was such a
success that the company was eventually renamed Royal Crown Cola Co. By 1940, RC
products were available in 47 of the 48 states.
As RC continued to grow, it stayed true to its independent personality by producing
innovation after innovation. In 1954, the company became the first to nationally
distribute soft drinks in cans. Four years later, the company introduced the 16-ounce
bottle.
In terms of beverages, RC produced the first low-calorie diet cola (Diet Rite), the first
caffeine-free diet cola (RC 100) and the first diet cherry cola (Diet Cherry RC). Other
RC innovations include the all-aluminum beverage can and Royal Crown Draft cola, a
premium cola made with pure sugar cane.
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REPORT ON RC COLA
In 1998, RC was relaunched with new packaging, a dynamic logo, and a new tagline:
"Be Free, Drink RC." RC also introduced RC Edge, the first maximum-power cola
containing a synergistic blend of Indian ginseng, taurine and caffeine.
What's in a name? RC Cola received its name from the people who matter the most: its
consumers. When the reformulated product was released in 1934, the manufacturer
named it "Royal Crown Cola." As the soft drink became increasingly successful,
consumers affectionately abbreviated the name to "RC."
IQRA UNIVERSITY
REPORT ON RC COLA
Karachi
Kotri (Hyderabad)
Multan
Lahore and
Islamabad
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REPORT ON RC COLA
their empty bottles from the market and stocking them in their godowns or warehouses.
Due to the shortage of the empty bottles, they had to buy new bottles from Baluchistan
Glass Bottles manufacturers, and had to pay a large amount. They are already financially
unstable and this unethical action also affected their production capacity. Continental
beverages stopped their production for 2 years, between 2002-2004. In this period
some people in the interior areas of Sindh started hand re-filling of RC Cola and were
selling these fake bottles in the lower market, because the empty bottles were easily
available. When the company stopped their production in the period between 2002-2004,
it did not announce officially that they stopped their production because they want to relaunch their product. Due to this some people were misunderstanding that the drink was
available in the market but cater to very lower class.
Finally, they re-launched RC Cola on 15th Feb05 and also introduced some new products
along with RC Cola.
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REPORT ON RC COLA
Main reason for failure of RC Cola was their distribution network. Initially in 1981
company started with their own distribution network and capturing the market very
well but after 1986 company was unable to carry out its own distribution network as
they were financially unstable so decline in the sales started which lead to failure in
unavailability of product at outlets.
As a part of publicity other companies like Coke and Pepsi were giving vesicular to
the retailer for storing product, but RC Cola were reluctant to do so as a result of
which retailers were start keeping competitors product.
If we analyze all the reason for failure, we concluded that their product was not have
any problem but reason for failure was financially unstable and presence of tiger
competitors like Coke and Pepsi, as a result of which they left the market for 2 years.
IQRA UNIVERSITY
REPORT ON RC COLA
SWOT ANALYSIS
The analysis of the internal and external environment is integral for determining the
companys strategic standpoint and potential for success regarding the product.
STRENGTH
Continental beverages served the Karachi market since 1985.At that time RC Cola
hold a very handsome share in the market and people used to drink it.
After 1986 the company was unable to serve their customers because of the
distribution network as well as they were also unable to get hold of other customers
because of lack of advertisement. But still people remember and know that there
existed one Cola drink by the name of RC Cola.
Their prices are relatively lower than their competitors. It is strength for the
company.
The Karachi franchise is a small plant (area is 0.34 acres). It is very easy to over
head or look after the plant. It reduces the levels of managers in the hierarchy. A
single manager looks after more than one department like, production, sales etc.
WEAKNESS
Just because of the financial problems and unavailability of loans from banks, the
company was unable to increase their market share and advertise or promote their
products as compare to their competitors in the past. Because of these problems the
Company was closed for 2 years.
The current financial instability is a weakness for the company. Because of the
financial problems in the past RC Cola was failed to hold a strong market share.
As in the case of Pepsi, it has 14 franchises and Coca-Cola has 13 franchises all over
Pakistan. If any international beverage company has more than 10 franchises in Pakistan
IQRA UNIVERSITY
REPORT ON RC COLA
than the Parent company of that franchise give funds and provide financial assistance for
advertisements and promotions. That is why Pepsi and Coca-Cola are lucky because they
contribute just 25% for advertisement and the remaining 75% are contributed by their
parent companies.
RC Cola has only 5 franchises in Pakistan. That is why their parent company
(ROYAL CROWN COLA COMPANY) does not contribute in their promotional
activities.
OPPORTUNITY
As you know that RC Cola re-launched on Feb 15 th 05. This is the best time for any
beverage company to launch a soft drink because the period between April-July is the
most suitable period because the sales of soft drinks are at peek in Karachi. That is why
continental beverages re-launched RC Cola in this period to attract more customers by
offering their soft drinks at a lower price as compare to their competitors.
The summer season is an opportunity for RC Cola to attract more customers.
THREAT
In the beverages industry, there are already very strong competitors like Pepsi and CocaCola are present. They hold a very strong market share. It is very difficult for RC Cola or
any other beverage company to stand and hold a smart market share in this industry.
The strong market leaders are a threat for RC Cola.
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REPORT ON RC COLA
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REPORT ON RC COLA
BCG MATRIX
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REPORT ON RC COLA
lack of investment at that stage, when there was a high growth in the market it became a
dog and gone away from the market.
RC Cola re-launched on Feb'05 the situation in the market is same as in the past and
again RC Coal re-introduced as a question mark.
SUGGESTIONS
In order to gain 10-15% share in the cola market in coming years, it requires a lot of cash
infusion. If it would not be happen it will be very difficult for RC Cola to sustain in the
market.
Still it will be a very big achievement for RC Cola if it will become a star in the presence
of two market leaders. Because RC has the potential to become a star if it became
financially stable. It is very very difficult for any soft drink, to become a cow in this
competitive environment.
CUSTOMER PREFERENCES
In customer preferences, we will analyze some of the questions of our survey research.
Because this analysis will help us to understand the customer preferences.
What content would you prefer in your drink?
CONTENTS
31%
38%
Fuzziness
Concentration
Sw eetness
31%
According to the data collected by our survey, it was found that 38% people prefer
fuzziness, 31% concentration and 31% people prefer sweetness in their drinks.
The analysis shows that majority of the people prefer fuzziness in their drinks.
The percent age of the sweetness and concentration is same.
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REPORT ON RC COLA
Our next question, which of the bottle do you want in 250ml? (Options are glass bottle,
can, disposable bottles, and plastic bottles.)
BOTTLES
Glass bottles
13%
33%
Can
Disposible bottles
34%
20%
Plastic bottles
According to this graph 34% of them prefer cans, 33% of the people prefer plastic
bottles, 20% of them prefer disposable bottles and 13% prefer glass bottles.
This analysis shows that either cans or plastic bottles should replace the glass
bottles.
Next question is what price range would you prefer? (For 250ml). And the answers we
received for this question were as follow:
PRICE
7%
20%
6--8
8--10
10--12
73%
IQRA UNIVERSITY
REPORT ON RC COLA
According to this graph, 73% of the people prefer price between Rs.8-10, 20% of
them prefer price between Rs.6-8, and 7% of them prefer between Rs.10-12.
This analysis shows that approximately 73% people are satisfied with the existing
price range of the 250ml cola drinks in the market.
SUGGESTIONS
According to the results of customer preferences:
People want fuzziness in their drinks, If Continental Beverages increase the level of
fuzziness in RC Cola, the customers want to drink it. Because when we asked
different people about the improvement that they want in RC Cola, most of the
people give suggestion that they must increase fuzziness in RC Cola if they want to
satisfy the customers.
As far as the price is concerned the company gives RC Cola to the distributors and
retailers at a price of Rs.8/ 250ml bottle. But some retailers sell it on the price of
Rs.9 or 10 to the customers. If the company controls this change in the prices from
retailer to customer, then the customer will definitely prefer a quality drink at a
lower price as compare to their competitors.
The company is working to introduce its products in 250ml or 330ml pet bottles in
the coming years. If they introduce RC Cola in cans then it will be attractive offer
for the customers.
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REPORT ON RC COLA
CUSTOMER SATISFACTION
We had a question in our questionnaire related to customer satisfaction, in order to find
out their satisfaction for RC Cola before re-launch. The question was:
Tell me how much you liked the RC cola by pointing to the face that best shows how
much you liked it.
*0%
*40%
*80%
0% (dissatisfied)
40% (somewhat satisfied)
80% (satisfied)
100% (fully satisfied)
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*100%
REPORT ON RC COLA
SATISFACTION
13%
7%
40%
0%(dissatified)
40%(somew hat
satisfied)
80%(satisfied)
100%(fully satisfied)
40%
According to this graph, 40% of them were somewhat satisfied; 40% of them were
dissatisfied, 13% of them were satisfied and 7% of them were fully satisfied.
The satisfaction of the customers is based on their preferences. If the manufacturers of
RC Cola provide them what they want then customers are automatically satisfied from
RC Cola.
REPORT ON RC COLA
Punjab is longer and hotter than in Karachi and Hyderabad. Thats way the three
franchises are in Punjab.
ANALYSIS AND SUGGESTION
As we know that the Continental Beverages has became the franchise bottlers for
province of Baluchistan and will also start their distribution in Sukkur. It is a great
achievement for company, because there is no franchise of RC Cola in Baluchistan. And
we think that it is the only franchise of RC Cola in Pakistan that has became the franchise
bottlers for two provinces. This helps them to increase the market share of RC Cola and
generate cash.
As they are catering the Karachi city and will also cater the Sukkar city of Sindh in
the coming year, they should try their best to capture as many as cities of Sindh as
possible, like:
Hyderabad
Nawab Shah
Larkana etc.
Where the people are still using unbranded soft drinks and fake soft drinks of Pepsi
and Coke. This is the best market to cater and create awareness about RC Cola. The
climatic conditions of these cities are also very attractive for the beverages industry.
DEMOGRAPHIC
Demographically the market is segmented on the basis of:
Age
Gender
Family size
Income
TARGET
Currently, Continental beverages is catering the age group of 13-26 years. Its main
focus on school and college going children and young adults. But some of the products of
Continental beverages are especially for women and children like:
PAKISTA (a green drink like Pakola)
ROYAL LEMONADE and
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REPORT ON RC COLA
ROYAL ORANGE
Specially, Pakista which is very famous among women.
Now the Continental Beverages Ltd. introduces new 1.5lit pet bottles. These are economy
size bottles for families. In Pakistan most of the people prefer economy size bottles
because the average family size is 5-6 people and these pet bottles are suitable for the
families. Thats way they introduce 1.5liter bottles for all of their brands because of the
customer preference.
According to them their products are for average income people (income between
Rs.5000-8000) and they also cater their products to lower income people in the interior
areas of Sindh in order to grab larger market share. Because Pepsi and Coke are firmly
establish in the urban areas and they do not cater the lower lowers. Thats why the
Continental Beverages Ltd. captures low-income people in rural areas.
After 9/11 some new soft drinks enter in the cola market like:
Amrit cola
Mecca cola
Zam zam cola
In which two are local brands and one is Irani brand. They boycott franchise soft drinks
and forces people to use Islamic and local products. After the 9/11 uptil now they did not
face any problem related to religion. But the franchise bottlers always give importance to
the norms, beliefs, and attitudes of the target market.
PSYCHOGRAPHIC
In psychographic segmentation, Continental Beverages consider only one factor, which
is social class.
TARGET
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REPORT ON RC COLA
Their target social classes are middle class and lower class. In past they were catering to
these classes. But they face some problems in catering to these social classes. In the view
of Executive Director of Continental beverages,
In Pakistan the rich has became richer and poor has became poorer and the
middle class is almost ended or converted into lower class in Pakistan. It is very
difficult to stick to the same social classes and caters them.
That is why they make changes in their strategies and decided that they continue to cater
the middle and lower class and also try to cater the upper class. In order to attract upper
class they gave free samples to people at Park towers (Clifton) on 18th, 19th and 23rd of
this march. They also introduced UTC (under the crown) scheme between April till
March this year, in which they gave prizes to children. The company will recently
introduce DIET RC COLA in order to attract health conscious people. They will also
launch pure clear drinking water by the name of KENNY. According to their view it
will be a premium clear drinking water but not mineral water. Because in mineral water
sodium is present in a reasonable high quantity which is dangerous for the people in
Pakistan because in Pakistan the people are not facing the problem of sweating like in
Saudia and Kuwait, where the sweating rate is much higher than in Pakistan. That is why
their body requires minerals. But if these minerals are given to the people in Pakistan, it
causes stomach problems. They decided to create awareness among people about the
Drinking water and also try to grab the attention of educated people.
BEHAVIOURAL SEGMENTATION
Considering variables:
Occasions
Benefits
User status
Attitude toward product
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REPORT ON RC COLA
TARGET
In behavioral segmentation Continental Beverages grouped the people on the basis of
their responses and usage of the product.
They considered that the consumption of soft drinks does not remain the same through
out the year. In summers (April-July) it sales increases but in winter it sales decreases. In
summers the people used it on almost regular basis. But in winter they use it occasionally,
or use it when they go out (on premises). In order to increase the sales in winter season
they influence people by their tagline:
Be Free, Drink RC.
By this tagline they want to promote RC Cola as a cool and refreshing drink. That can be
use at anytime.
Different people want different mixes of benefits from the products they buy.
Continental beverages introduce 1.5lit pet bottle because people want economy size
bottle. In this way they want some thing new in the drink like change in flavor. That is
why the company will introduce RC Cola with Cherry flavor and Diet RC Cola in the
coming year on the basis of consumer demand.
Currently, the company tries to regain its ex-users. In past their target markets were the
middle and lower classes. They were also catering the interior areas of Sindh. After relaunching, they have the same future strategies but they want to increase the market share
thats why they decided to cater the upper class in order to convert the non-users into
regular users. Continental Beverages tries to gain a positive attitude toward RC Cola by
giving a good quality product at a lower price as compare to their competitors and make
sure that their product in available at almost all places in Karachi.
MARKET POSITIONING
Continental beverages Ltd. is working to occupy a very distinctive position in the mind of
customers by giving them superior quality products. The emphasis on the careful
delivery of their products. They ensure that RC Cola reaches to customers in the same
condition in which it was made. In this way they attract customers towards the quality
maintenance of their product.
Secondly, they want to hold the position of RC Cola in the mind of the customers as a
cool and refreshing drink by using this tagline:
Be free, drink RC
Means that you can drink RC any time to refresh yourself.
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REPORT ON RC COLA
MARKETING MIX
Marketing mix consist of every thing that the firm can do to influence the demand for its
products.
Here we will be discussing the 4 Ps of RC Cola.
PRODUCT
Products are the goods of the company that they offer to their target market. Currently,
Continental Beverages have four products:
RC Cola
Royal Orange
Royal Lemonade
Pakista
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REPORT ON RC COLA
and RC Cola and if there is no logo present on the bottle, a buyer of soft drink easily
recognizes Coke just because of the bottle design.
EXISTING BOTTLE DESIGN
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Introduce RC Cherry
in the same design
Also introduce RC
Cola in cans and
disposable bottles
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REPORT ON RC COLA
PRICE
RC Cola is available in two packaging:
250ml glass bottle
1.5lit pet bottle
LIST PRICES
A crate of 250ml-bottle of RC Cola contains 2dozen (24) 250ml regular bottles; the cost
of the carat is Rs.192. It means that the cost of each 250ml bottle is Rs.8.
The crate of 1.5lit pet bottle contains 6 bottles. Each bottle cost Rs.40, means that the cost
of the crate is Rs.240.
RETAILERS
The distributor gives 4 bottles free of 250ml to the retailer on each crate. It means that the
retailer gets a discount of Rs.32 on each crate. The company set a price for 250ml bottle
is Rs.8, but some retailers sell it on the price of Rs.8 to Rs.10 to the final consumer. In
this way they get an additional profit.
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REPORT ON RC COLA
In the case on 1.5lit pet bottles, the discount of the retailers based on the distributor
because sometimes they give discounts to retailer or sometimes not.
PLACE
Continental Beverages uses 25 direct routes (means their own vans) and 35 indirect
routes (different distributors work for them) to distribute their products in the market.
This franchise has two warehouses one in the site area (behind the manufacturing plant)
and another in the Clifton area. Currently, they are working to expand their distribution
network. Thats why on April 10, 2005 (Sunday), they gave an ad in Newspaper JUNG
by the heading of Distributors Are Required
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ANALYSIS
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REPORT ON RC COLA
They are working to improve and expand their distribution network in more than 40 areas
of Karachi by hiring more distributors.
PROMOTION
Currently, Continental Beverages give more importance to the availability of the product
than to advertise it.
According to the view of Mr. Fayysal Iqbal:
If your distribution is strong/good and your product is easily available in the
market. After the availability of the product in the market then you advertise your
product, in this way you satisfied your customer in a good way. But if you first
advertise your product on a large scale but your distribution is not good enough,
means that your product is not easily available in the nearer stores or in the market.
Example if the customers go to the nearer retailers shop and asked about the
product which he/she saw in the TV or hear on Radio but if his/her desired product
is not available in the market then it definitely dissatisfied your customer.
That is why they are currently not advertising their product. But they are doing some
promotional activities like on March 18th, 19th and 23rd they gave free samples of soft
drinks to people on Park Towers and distributed free gifts among children.
They are working to organize a function at PAF Museum on 1 st May 2005 to promote RC
Cola.
PROMOTIONAL SUGGESTIONS
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Television
Cinema
Magazine
Newspaper
Radio
Outdoor advertisement
Promotional activities
TELEVISION
Television has the consistency high viewership among the target market. It provides
maximum coverage as most of the youngsters watch television regularly.
Among them Indus Music and Ary Digital must be selected because youngsters mostly
view these channels, because these channels provide a lot of entertainment program for
them. PTV World and PTV Network have wide coverage and are the channels that are
viewed by the masses. Ten sports has emerged as a channel that comes cricket related
events of Pakistan and thus viewers ship mostly consistency teenagers and young adults.
CINEMA
The company should put banners in cinemas like Nishat , Capri and other popular
cinemas in Saddar. This will promote RC cola among the lower and middle class. Also,
they should put large bulletin boards in the Saddar area to attract consumers towards the
drink.
MAGAZINES
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REPORT ON RC COLA
RADIO
Radio advertisement can be used to enhance the message and communication.
FM 100
(Transmission schedule)
5:00 am
7:00 am
10:00 am
12:00 pm
3:00 pm
6:00 pm
10:00 pm
12:00 am
7:00 am
10:00 am
12:00 pm
3:00 pm
6:00 pm
10:00 pm
12:00 am
5:00 am
Holy Quran
Wake Up show
Morning drive time show
Lunch time special
Competition time
Drive show
Rock time (English music)
Ghazal time
FM 100: In this they can advertise, during 10:00 pm to 11:00 pm, when English songs
are on air because this is the time when their target audience especially young teenagers
tune into the channel.
FM 101: In this they can advertise during 11:00 pm to 12:00 am, when English programs
are aired. This is also a convenient time for the target audience.
NEWSPAPER
Dawn
Jung
The News
Jung is the most widely read newspaper in Pakistan with a publication of over 750,000.
Dawn and the news also cater those people prefer reading in English.
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Sea view
Delton road
Zam zama road
National stadium road
Nipa round about
Baharabad area
Liquat-a-Bad BRIDGE
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Area 51
3.0
Zubaida's)
MUSICAL CONCERT
Musical concerts held on and off through out the year. Only those concerts are arranged
which will give an opportunity to have maximum coverage of target audience.
PROMOTIONAL ACTIVITIES
Promotion will be done at outside popular grocery stores. Free samples of RC Cola, and
handbills will be given out. Promotion might be done outside:
Aghas supermarket
Imtiaz supermarket
Naheed store
Time medico
Murad medico
Dolman mall
And other local outlets
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REPORT ON RC COLA
Aghas supermarket has been selected to cater the target market of Clifton and defense
area. Dolman mall, time and Murad medicos will help in reaching the target market that
resides in the areas of Gulshan-e-Iqbal, PECHS, Bahadurabad etc.
In these promotional ideas, we have tried our best to suggest as many as creative ideas.
Some ideas are to attract the upper class and some ideas are only to attract the middle
and lower classes. Through these ideas all the classes are easily attracted toward RC
Cola.
RECOMMENDATION:
After completing the report, following things can be recommended:
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REPORT ON RC COLA
QUESTIONAIRE
Please mark the circles and give rates (where written) that best reflect your response to
each question.
1. Which of the following soft drink have you used?
o Pepsi
o Coca Cola
o Double Cola
o Amrit Cola
o Mecca Cola
2. How often do you drink a soft drink?
o Once in a day
o Twice a day
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REPORT ON RC COLA
Packaging
Price
Easy availability
Taste
Advertisement
6. Where do you drink soft drink?
o At home
o At office
o Anywhere
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o Can
o Disposable bottle
o Plastic bottle.
8. Does price matter in your consumption?
o Very likely
o Very unlikely
o Somewhat likely
o Somewhat unlikely
b. What price range would your prefer? (For 250 ml.)
o 6-8
o 8-10
o 10-12
9. What contents would you prefer in your soft drink? (give rates)
Fuzziness
Concentration
Sweetness
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40%
80%
100%
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*others__________.
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