Marketing Management (Coca Cola)

MARKETING MANAGEMENT TERM PROJECT ON

TABLE OF CONTENTS  Executive 

Summary

Objective of the Study

 Methodology  Industrial

Profile



Coca-Cola Profile



Coca-Cola Strategies

 How

did Coke Get into Mess



Consumer Behavior



The 4P’s and 3A’s



SWOT Analysis

 Analysis

of the Study



Sales Promotion of Coca Cola



Conclusion



Questionnaire

TABLE OF CONTENTS  Executive 

Summary

Objective of the Study

 Methodology  Industrial

Profile



Coca-Cola Profile



Coca-Cola Strategies

 How

did Coke Get into Mess



Consumer Behavior



The 4P’s and 3A’s



SWOT Analysis

 Analysis

of the Study



Sales Promotion of Coca Cola



Conclusion



Questionnaire

EXECUTIVE SUMMARY The consumers buying behavior is dynamic and unique in nature and each company through its sales promotional efforts tries to have a positive impact on them. Being the worlds most ambitious brand CocaCola wants to increase its market share in India and to achieve this it has undertaken aggressive sales promotional strategies in the past few years. Through our project we have made an attempt to understand how successful Coca-Cola is in influencing the mind set of the consumer through various promotional activities it has undertaken and their short comings. Our endeavor in this project was to understand the soft drink industry and the functioning of Coca-Cola. The effect of Sales Promotional strategy on buying behavior was understood through the questionnaire method of survey and informal interview with retailers and consumers. The questionnaires were analyzed and the results showed that these strategies had a direct and positive correlation with the consumption pattern. The communication channels at all levels are another key factor that has played a critical role in bringing about these changes.

Even with a number of constraints, we have been able to get a fair picture as to how Sales Promotion schemes work on the mind of the consumer and help the company in achieving its goals. Recent Sales Promotional activities undertaken by Coca-Cola : In order to come close to the typical Indian consumer who are inclined towards movies, sports and other entertainment activities, Coke has initiated aggressive campaigns in this regard. This was largely to cater to a larger population as well as getting an edge over its rival brand. The following are some of the recent activities sponsored by coke.



To cash in on the latest Aamir, Sonali megahit “Sarfarosh”, a  promotion „Sar -fresh ho jaao‟, was organised in Aurangabad. This

was well published in the leading newspapers and as many as 65 banners were placed at strategic points.



Coca-Cola sponsored „Johnny Lever Nite‟ and „Phalguni Pathak   Nite‟ were held at Nasik. Both the events were well publicised

through banners, posters, hand bills and ads in local dailies.



Thums Up sponsored „Gurdaas Maan Nite‟ at Aurangabad. To

publicise truck backs were painted with event detail. A trade

redemption scheme of 100 tickets ran wherein consumers got a ticket for a PET bottle.



Urs known as „Jarjari Baba Baksh Dulhemiurs‟ is a popular festival

held at Kultabad in Aurangabad district. This gave Coke an excellent opportunity to connect with the rural consumer. They put up special banners welcoming pilgrims at key intersections, outlets were elaborately merchandised and several discount schemes were made. Around two lakhs people are estimated to visit every year.



The up country town Hassan in Karnataka now boasts of the countrys

first „Coke pub‟. This outlet solely stocks and sells

only coke products and offers discounts and other scheme.



Coke Channel [V] Live Show was held at Pune with an audience of  20,000 plus. A trade redemption scheme ran wherein consumers could exchange 3 Coke crowns with a ticket of the show. People wearing Red or having Coke at particular outlets were given free passes. The show featured Parikrama, Aryans, Jassi, Pentagram and Channel [V] V.J‟s.



Coca-Cola organised a series of musical shows featuring the latest sensation in Punjabi music, Hans Raj Hans. The shows were held in

Hoshiyarpur, Phagwara, Mohali, Patiala, Bhatinda and Amritsar. Each show was attended by about 30,000 people.



As schools and colleges opened up for the new academic session at Hydreabad and Secundrabad, the students were given a refreshing welcome by Coca-Cola. On the opening day the products were made available to students at a special price of Rs.4/-. The „Back to School‟ activity was conducted in 63 schools and college across the

twin cities.



Malahar a restaurant at Taj Residency, Indore, had a specially designed cricket bat shaped Coca-Cola menu card.



A basic computer awareness program was organised at Ahmedabad for children in order to teach them fundamental of computers and various games. Students were also awarded with certificate and momento.



Coca-Cola has always associated itself with cricket by hosting various tournaments both at national and international levels.



Coke came up with certain promotional schemes at Diwali like „Do Wali Dhamaka‟ in association with bowling alleys like Magic

Planet, Little paradise etc. in Delhi. It also hosted the Diwali

Carnival at the Bristol Hotel with the main attraction being the pop singer Jassi.



The most successful campaign for Coke in recent times has been its association with movies, particularly the latest blockbuster „Hum Saath Saath Hain‟. The unique feature of this campaign was that all

the banners of the movie featured the name Coca-Cola. The above mentioned campaigns are just a indicator of the vast and aggressive promotions planned on part of Coke. Their campaigns are aimed at publicizing Coke throughout India both rural and urban and focusing on their slogan „Always getting closer to within arms reach‟.

OBJECTIVE OF THE STUDY The present soft drink industry in India has two major giants in CocaCola and Pepsi Co. Coke has a market share of 53% and Pepsi lags behind marginally. Thus both these companies adopt aggressive strategies to gain an edge over the other. Our objective has been to study the effect of sales promotion strategies adopted by Coca-Cola and the effect these have on the consumer buying behavior. The aim of this project is to understand how successful Coca-Cola has been in creating an impact on the minds of the consumer through its campaigns and thereby increasing its brand loyalty and market share.

METHODOLOGY The study was conducted through a questionnaire survey of consumers. The sample size was 50 which was randomly chosen and importance was given to the heterogeneity in the sample. The questionnaire stressed on the role that sales promotion strategies play on the mind of  the consumer and whether they induce a customer to change preferences. It measures the effect of these schemes on the purchase decision and the brand image. The consumers were also interviewed to get an in-depth knowledge of their preferences and how a company works on their psyche through Sales Promotion strategies. The knowledge of the retailers was gauged by the interview method. The interview helped us to know what strategies he adopts on behalf of  the company to push the product to the end consumer.

SALES PROMOTION

CONSUMERS

INTERVIEWS

RETAILERS

UESTIONAIRRE

INTERVIEWS

INDUSTRY PROFILE Since the entry of PepsiCo to India in 1987, the soft drink industry has undergone a radical change. When Pepsi entered, Parle was the leader with Thums Up being its flagship brand. Other product offerings by Parle were Limca and Gold Spot. Another upcoming player in the market was the erstwhile bottler of Coca-Cola, Pure Drinks. Its offering included Campa Cola, Campa Lemon and Campa Orange. With the re entry of Coca-Cola in the Indian market, Pepsi had to go in for more aggressive marketing to sustain its market share. The chronology of the initial phase of the „Cola Wars‟ started in 1977

when refusing to dilute its equity stake Coca-Cola wound up its operations in the country. Parle launched Thums Up and Pure drinks launched Campa Cola. In 1990 Pepsi Cola and Seven Up were launched in limited markets in north India. At the same time the Pepsi project was cleared by the government and there was a change in the brand name to Lehar Pepsi. Simultaneously the Coca-Cola application was rejected. Citra from Parle hit the market in May 1990. In 1991 Pepsi extended its reach on a national scale with products being launched in Delhi and Bombay. By 1993 Pepsi launched Teem and

Slice and captured about 25-30% of the soft drinks market in about 2 years. The fact that the fight for market share in Cola segment is referred to as Cola wars signifies the intense competition prevailing in the industry. Although Parle had complete dominance in the drinks market it opted out of the competition. Both Coke and Pepsi have reowned brands, and financial and marketing power to support them.

THE COCA-COLA PROFILE The product that has given the world its best known taste was born in Atlanta, Georgia on May 8, 1886. "Delicious and Refreshing" a theme that continues to echo today wherever Coca-Cola is enjoyed. Dr. John Styth Pemberton, a local pharmacist, produced the syrup for CocaCola. The trademark Coca-Cola, used in the marketplace since 1886, was registered in USA patent office on January 31, 1893. The now familiar shape was granted registration as a trademark by the US patent office in 1977. The bottle joined the trademarks "Coca Cola" registered in 1893 and Coke registered in 1945. Ernest Woodruff was the person who gave Coke to the entire world. The company pioneered the innovative six-bottle carton in the early 1920's for e.g. making it easier for the consumer to take Coca-Cola home. The Coca-Cola Company were also the pioneers of fountain dispensers and the metal can. During the World War 2. Coke distributed 5 billion for the military service personnel during the war. As the world emerged from a time of conflict, Coca-Cola emerged as a worldwide symbol of friendship and refreshment. In 1955, the CocaCola company marketed its first soft drink other than Coke :- an

orange flavored soft drink introduced in Naples, Italy. Fanta is now the number 5 soft drink worldwide. Also in the late 1950's company developed a citrus flavored drink. The short, sharp and memorable sound of  Sprite made it an ideal name for the new product. Minute Maid is another of the company's popular trademarks. In 1982, Coke

created history by introducing Diet Coke - a top low calorie soft drink. In 1988, Coca-Cola was confirmed as the most admired and best known trademark in the world.

THE BRAND - COKE The product Coke falls in the low involvement product category. A high involvement product category includes products like washing machine which one buys after lot of exploring and research. On the other hand a low involvement product involves more of instant buying e.g. centerfresh, coke, Pepsi, etc. For such a product the advertisements are a must as it is through ads the brand can be made a "top of the mind" brand. The advertisement of Coke are as a matter of fact large in number, since it is these ads which actually leave an impact on the audiences mind. Worldwide, Coke as such has had a very serious image. It has been the older generation that has been its target audience, as it has maintained

a very official image. But, in India, Coke was not being successful with its image since the concepts of consuming aerated drinks is common among the youngsters. The older generation prefers tea or coffee to soft drinks. Therefore, Coke has now shifted its target to the young generation. Now the ads include young stars like Karisma Kapoor, Twinkle Khanna, Aamir Khan etc. Even when we see the Coca-Cola ads we can see that it maintains its serious/official image. It never comes up with counter ads like Pepsi does. For instance, when Coke became the official sponsor of the World Cup, Pepsi came up with its adline- "Nothing official about it". The main competitor of Coke is Pepsi and there are very few others. Looking at the competition one can say that the market structure that the company is operating in is Oligopolistic. The competitiveness between Coke and Pepsi is evident through the advertisements and the price changes from time to time. The price of the two products remain always the same as one can be bought easily in place of the other. So to say, when the price of one falls, the other immediately follows. Globally Coke is more in demand, but in India it is marginally ahead of Pepsi with 53% share falling from initially 67% share.

HOW DID COKE GET INTO A MESS IN INDIA ?

The answer to that question is the story of how Coca-Cola -- which ran up nearly $2.5 billion in net earnings in 1999 -- has made a mess of its first nine years of its second coming in India. The country is one of the largest of the nearly 200 markets it operates in. By the end of this year, Coke would have pumped in $800 million in India, $700 million of it in the last three years alone. That is more than the investment it has made in any other emerging market ever, and more than twice the investment that Pepsi has made in India. By internal assessments, Coke can't even begin to make profits on that investment within the next 18 years. But the most embarrassing part is this: after all these years, India is the only market in which Coke trails as the third cola brand -- after Thums Up and Pepsi. Alex von Behr, the new Coke India chief is now here to control the operations. Coke is hoping that von Behr's past will help him in the current job. "His must be the second-most Herculean job in the Coke world to that of Douglas Daft (Coca-Cola Inc.'s just-appointed new CEO)," says a Coke insider. To understand why, visit Coke's headquarters at Gurgaon, outside Delhi. Since September -- when a team from Atlanta arrived to comb through Coca-Cola India's

operations to find out where the excesses have piled up -- executives have dreaded walking down the corridors for one reason. The office has too many dark rooms, too many empty chairs, and squeaky clean desks. Of the group of 300-odd who would keep the office buzzing at all hours last summer, no more than 198 are left at the Coca-Cola India headquarters. Among those who have left are top-notchers like Damindra Dias, vice-president (finance), Cynthia D'Souza, vicepresident (human resources), and George Samuel, chief of franchiseeowned bottling operations. They didn't leave as others do -- others are routinely transferred overseas. They simply left the company. The period will go down in the company's history as payback time, for the mess that it got into in the 1990s. As Coke prepares for a fightback, within the company there is a bold and open admission of the things that went wrong. Three major strands have emerged in its mistakes. It never managed its infrastructure, it never managed its crate of 10 brands, and it never managed its people. Today, Coke is working at full speed to rectify precisely those three mistakes. Coke has a huge distance to cover before it can put the mistakes of its past behind. As it wound its way through the decade, every one of its chief executive officers faltered on each of these counts. The story begins from 1993,

the year Coke returned to India after 16 years, riding on a big bang deal. Wrong cue?

Remember the basic facts of the time? Jaydev Raja, young, spunky CEO, moves in on the country's largest soft drink operation, owned by the tough-talking Ramesh Chauhan. Raja proceeds to buy out the brands (which enjoyed an aggregate market share of 60%) -- the market leader Thums Up, Gold Spot, Limca (and later, Maaza). More vital to him is the network of 56 bottlers that comes with the deal. From day one, Coke the company begins with a bang. Pepsi is running scared.Raja, in asking Chauhan for his network, had butted into a similar conversation between him and Pepsi. Industry sources say that Pepsi had got KPMG to value the operations, and that the total valuation of the brands and the distribution agreements that would have to be inked with the bottlers came to around $73 million. Coke, it is believed, paid out no less than $100 million in pipping Pepsi to the post (of which a straight payment of $40 million was made to Chauhan for the brands). Did Coke overpay? It is difficult to answer that question, but a comparison should help -- after losing out to Coke, Pepsi invested over $400 million in its own bottling operations. That

slowed it down somewhat but also ensured that it did not have to grapple with a culture problem that became Coke's worst nightmare a few years later. The Chauhan deal also included a couple of little clauses that would return to haunt Coke. Chauhan tried to ensure three future roles. He was to be consultant to Coke, he would have first right of refusal for a mega bottling plant for the Pune-Bangalore corridor, and as bottlers in the two biggest markets Delhi and Mumbai, he and his brother would have a powerful say in Coke's future. Getting the marketing and distribution act together had proven beyond him. To be fair to Raja, the weaknesses in the bottling system were almost insurmountable. Territories were like fiefdoms. The plants were low-tech affairs with an average capacity of 200 bottles per minute (Coke's global standards are between 1,200 and 1,600 bpm). Bottlers had to deal with a corporate system that kept them at arm's length. They were invited to 5-star hotels for half-day workshops on Coke's market plans. But the flow of ideas was one way -- no inputs were taken from bottlers. Coke on its part had to struggle to convince bottlers that they needed trucks which would have back doors that could be locked. Investment of every extra cent had to be forced down the bottlers' throat. Chauhan's bungalow at Santiniketan, New Delhi,

was becoming the centre of growing discontent. Bottlers dropped in, told Chauhan of their problems with Raja's set-up. Chauhan himself  started telling people that Coke was not doing enough to promote Thums Up. Coke was not consulting him on any move, making a mockery of his "consultant" status. Finally, the action shifted to Chauhan's lawyer's home at Vasant Vihar, where Chauhan spelt out why he felt cheated. He brought up the clause on his consultant status, on fees that he thought should still be paid to him, and on the fact that Coke did not want to give him the right to set up the bottling plant for the Pune-Bangalore corridor. On condition of anonymity, those within Coke who weathered that storm will tell you another story. Coke found that more Thums Up was being sold in northern Indian markets than it had supplied concentrate for. Where did the extra concentrate come from? Coke suspected the man who had till recently owned the Thums Up formula. Whatever be the truth, what came into the open was the fact that Coke India and its biggest bottler were fighting a bitter battle. Baring its teeth

The headquarters felt that the man to replace Raja should be one who could strike bulk deals with hotel chains and big restaurant chains such as McDonald's. They picked Richard Nicholas, skilled at selling Coke

to big institutional buyers. Coke, through its massive initial purchase, had actually bought into a bit of a mess. It needed someone who could manage the excesses: both of bottlers and of brands.Nicholas was hardly the man for the job. Old timers among bottlers still remember the tone with which Coke spoke to them. Without prior consultations, Coca-Cola sent across formats for joint venture agreements to the bottlers -- they were being asked to give up ownership, part or whole, so that Coke could grow. The impression quickly gained ground that Coke wanted to grow at the expense of the bottlers. The gist of Coke's offer was: expand from 250 bpm to no less than 1,200 or 1,600 bpm, or simply sell out. There were those who never thought of selling out of  their businesses, some who set great store by being Coke bottlers, and others who felt that with the kind of money needed for the expansion, they would much rather set up four or five plants in new areas rather than expand so dramatically at their existing plant. Coke did not provide soft loans (such as those offered by Pepsi to its few franchisee bottlers) -- although it made huge capacity demands. New Delhi-based Mansarovar Bottling had to go public in the mid-nineties to finance growth. Several bottlers spent upto Rs 16 crore each in upgrading capacity from 200 to 400 bpm, when the margin on a bottle of Coke, for the bottler, was no more than a puny 5%. They mostly refused

Coke's ultimatum. Some bottlers started walking across to Pepsi (a migration by Pinakin Shah, Coke's Ahmedabad-based bottler, led to a court case). Once again, Ramesh Chauhan took up cudgels for his erstwhile bottlers, and it all hit the headlines. Brand stranded

Even as Nicholas put the big deals in place, Coke volumes were still not moving off the shelves into consumer homes.Coke ran its global ads to show off its worldwide leader status. One, called "Orchestra", showed people in a beach setting, playing the coke jingle on tin drums, bottles, and other make-shift musical instruments -- communication which worked elsewhere, but sank like a stone in India. In its three years in India, Coke went through three marketing heads -- Abraham Ninan, Nitin Dalvi, Ninan again. The ad-spend on Thums Up was negligible, but Coke was still failing to replace it, as planned. Thums Up's market share was being taken by Pepsi -- Pepsi Cola's share was around 30%, almost thrice Coke's. The dream of Coke-red India was fast turning to dust. You just had to take a look at Coke's 10-brand portfolio to see that. You call that a portfolio. There are three orange (Gold Spot, Crush and

Fanta) and two clear lemon drinks (Sprite, Limca) in there. But the central issue was bigger. Could Coke ever kill an asset like the Thums Up brand, when it could risk losing a substantial percentage of  its market share lead to Pepsi? Nicholas, his predecessor and his successors have not been able to make up their mind until recently. Now, the Thums Up ad budget has been stepped up, clearly to help it develop an identity. Nobody got it as wrong as Nicholas. Critics still underline the fact that when Coke's World Cup of Cricket campaign in 1996 got thrashed by Pepsi's spunky "Nothing official about it" splash, the sporty Thums Up was missing completely. Coke finally unleashed a big bungee jumping campaign for Thums Up in 1996, but withdrew it quickly after some children started trying to emulate the trained young man

who

tries

out

the

dangerous

sport

in

the

ad.

Mr Nice Guy

Nicholas' successor Donald Short came to India with one brief: to get the infrastructure issue resolved. And he came with a blank cheque. He realised early that the face Coke presented to India was too threatening, too rough, and too foreign. He changed things within the office, and concentrated on winning back the bottlers. Gradually, rather than through dramatic confrontation, he got them around to talking about

selling out. One by one, 38 bottlers agreed to sell, and the deals were settled amicably. The total bill, as mentioned before, came to $700 million. But some in the industry say that the price of cold beverages capacity should not go beyond Rs 3 per case, whereas Coke ended up paying between Rs 5 and Rs 7 per case. They say that made a huge difference. Short did manage to present a better face of Coke to the bottlers and employees. The prices paid for the plants included goodwill for market development for the last four years, and also compensated sellers for loss of earnings for a few years. Children of former owners were given  jobs (their understanding of the business would land some of them general managers' slots). He hiked salaries, a major factor in snaring more than 20 Pepsi employees, which prompted Pepsi to drag Coke to court. But again, overspending was an issue. When Short arrived in 1997, Coke had 60 employees in India. By the last quarter of 1999, that number had risen to well over 300 at the Gurgaon headquarters alone, even if you don't take into account the massive bottling workforce. Coke's big problem has recently been to rationalise its workforce at headquarters.

Coketales

Coke's bottling fiascos are legend. Here is one. One fine morning, the Timblose family that owned Coke's Goa bottling plant in India decided to defect (some say it was due to a marriage into the family of the Pepsi bottler). What did the soft drinks company do? Coca-Cola bought out Timblose truckers -- at four times what they were getting paid. Since it did not have a local bottling plant, these truckers had to then bring in supplies from neighbouring Karnataka at much greater cost. The company tried setting up a plant, but ran into environmental hassles. Chief minister after chief minister stalled the plan, while Pepsi, which by then had funded Timblose's new trucking line, made merry. The Coca-Cola plant has finally only just gone on stream. Pepsi has often aimed jibes at Coke in its Indian ads, most memorably through the "Nothing Official About It" campaign during the 1996 Cricket World Cup. Coke is retaliating through Sprite, its clear lemon brand. The ads poke fun at Pepsi's millennium commercials and other celebrity-oriented campaigns. Some in the ad industry think this isn't too clever -- taking on a drink that owns 60% of the most popular cola market with a minor label in the clear lemon segment, which itself  accounts for about 2% of the total cold beverages market. Coke doesn't

think so: it has traditionally royally ignored Pepsi, and is happy using extras to fight its battles. The hero it will save to fight another day. From a disaster case to a model which could earn more revenues for coke could be quite a transition. Watch out for that.

COCA-COLA’S STRATEGY Coca-Cola has adopted aggregation segmentation. This means that Coca-Cola is in effect not segmenting the market because its drinks are targeted at all people of all ages. Since the days it was launched in the country, Coke has not been able to take a distinct position in the market. It came in with the „We‟re glad

to  be back‟ nostalgia position for those Indians who had been consumers of Coke before it had left the country  –  primarily an elderly age group by now. Thereafter, it tried to position itself as the drink for all ethnic races (through advertisements showing people of different races and color dancing together), as the drink for young Indians (with the animated cricket advertisements during the World Cup) and as the drink for the Urban as well as the Semi-Urban Indians (with the „Zindagi ek josh hai‟ advertise ments showing semi-urban background).

Thus, it tried to be too many things to too many people and never occupied a distinct position in the mind of the Indian consumer (It‟s

current USP-Always Coca Cola almost gets lost in the entire ad sequence). With its nostalgia and the Zindagi ek josh ads, it also missed the big market comprising young city Indians who could not

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1958

The cold, crisp taste of Coke

1959

Be really refreshed

1963

Things go better with Coke

1970

It's the real thing

1971

I'd like to buy the world a Coke

1975

Look up America

1976

Coke adds life

1979

Have a Coke and smile

1982

Coke is it!

1985

We've got a taste for you (Coca-Cola and Coca-Cola Classic) America's real choice

1986

Catch the wave ( Coca Cola) Red white & you (Coca Cola Classic)

1989

Can't beat the feeling

1990

Can't beat the real thing

1992

Always Coca-Cola

1993…

Eat Cricket, Sleep Cricket, Drink only Coca-Cola

1999

Hum saath saath hai

2000

Jo chaho ho jaye coca cola enjoy

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The different types of Sales Promotion include 

Discounts

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Freebies

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Contests

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Exhibition

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Event Marketing

 Point of Purchase Material

PRODUCT RELATED STRATEGY To establish and reinforce Coca-Cola as the standard for product integrity amongst all beverages, Coca-Cola has adopted. The following measures

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Consistent delivery, wholesome product quality in line with established brand standards.

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In immediate consumption segments, always ensure ice-cold availability.

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Communication product integrity through a single brand

name

Coca-Cola unique product formulation and paralleled product integrity make Coca-Cola the beverage that delivers real Coca taste and refreshes the body mind and spirit. Key Components of Strategy Product Formulation Consistent delivery on key attributes of Cola taste, flavour, sweeteners, carbonation, body and colour.

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No chargers to current formulation

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No consumer taste test

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Full compliance‟s with product policy

 Product Delivery

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Ice-cold availability in “imm ediate-consumption” segments

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Communication of ice- cold consumption in “future consumption” segments through packaging graphics.

 Branding

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Single brand name-Coca-Cola

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Brand used in conjunction with English

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Logo in spencerian script as per ensuing

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CHANNEL MANAGEMENT Coca-Cola conflicts with its bottlers have finally settled down to a pattern that it‟s global experience understand. Coca -Cola India

is

floating two subsidiaries, Bharat Coca-Cola and Hindustan Coca-Cola, which will act as holding companies for most of its bottling operations, thus giving the transactional ownership and control over this company had made the mistake of demanding huge investments from its bottlers without worrying about the will to sustain losses as long as Coca-Cola did. In the process, it had alienated the former Parle franchises so much that they refused to give off their best. If Short can now adopt Pepsi method of transferring the translation‟s expertise to the bottlers, his

brands will benefit. Distribution and Bottling System

Virtually all the goods and services required to produce and market Coca-Cola locally are made in India. Wherever needed, assistance is  provided to local suppliers, enabling them to meet the Company‟s

regorous quality standards. In this way, CCI contributes not only to the development of the soft drink industry, but also to the development of  related industries and to the whole economy.

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developed indigenously by Coca-Cola India. The company was awarded the patent for the technology from the government of India, in January, 1998. The pouring junction is seeking worldwide registration through its Atlanta – based parent, the Coca-Cola Company. The pouring junction‟s distinctions are as follows:

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It‟s low – cost technology which offers mobility in vending

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Doesn‟t need electricity to operate

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Offers flexibility in dispensing amounts

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Ensure that the soft drink comes out chilled at the correct temperature and carbonation without any direct contact with contaminated ice for water.

The Pouring junction also promises to shake up soft-drink pricing. A chilled 200 ml will cost just Rs. 5 when dispensed from a pouring  junction, compared to Rs. 8 for 300ml dispensed from a fountain. The cooling system is deceptively simple, relying on a base loaded with crushed ice.

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streamlined distribution system, it on one hand suffers because of the turbulent relations that is has with its bottlers. Secondly, Pepsi has exclusive tie-ups with most of the restaurants, hotels, clubs, movie halls etc. thus raising the entry barriers for Coke in these captive markets. Coke is following suit but at the moment lags far behind Pepsi in this respect.

PACKAGE SIZES In 1993 the standard industry package was the 250ml returnable glass bottle. This was being retailed at Rs. 5 CCI introduced 300 ml Returnable Glass Glass Bottles, (RGB), while while maintaining the price at Rs. 5.00. The rest of the industry was forced to follow CCI‟s example and

upgrade to 300 ml from 250 ml. The focus of CCI was to offer consumers better value for price, and this has remained the cornerstone of CCI‟s strategy i n India. At present, CCI‟s brands are available in a host of package sizes.

These includes 200 ml RGB, 300 ml RGB, 500 ml RGB, 1 Litre RGB, 1.5 Litre Litre PET PET and 330 ml ml Cans. The 200-ml package was introduced in March 1996, and was positioned positioned to capitalise capitalise the potential of the rural and semi-urban markets of India. Coca-Cola India was the first first soft drink company in the country to launch cans. Coca-Cola and Fanta marked the beginning of the can revolution in India. These brands were launched in cans just before the World Cup Cricket in January 1996. Thum Up and Limca cans were introduced in May 1996. These launches brought India on par with international packaging standards in the soft drink industry. For the

first time Indian consumers had a convenient, mobile, single serve consumption package. Consumers benefited from 11 more brand package combinations, led by the successful, first ever launch of 1.5 litres PET bottles and the subsequent introductions of 500 ml and 1Litre RGBs. This came with the superior tamper-evident, leakage-proof Plastic Closures. This was a technological leap over the metal closures then used by the rest of the soft drink industry. All the four national brands, i.e. Coca-Cola, Fanta, ThumsUp and Limca are available in all of the above package sizes. Latest Development  Mobile Coke-easier to carry, more than can- around 500 ml  Mini Coke -Those who cannot consume 300 ml and for those who find

300ml-a bit expensive. Packaging Objective



To motivate brand purchase and maximize enjoyment of the consumption experience



To create a distinct identity for Coca-Cola in the mind of the consumer.

Overall



Differentiate brand Coca-Cola by the use of the contour package, icons and unique graphics.



Leverage packaging- as a communication vehicle of core CocaCola values.



Gain availability of consumer relevant package types and sizes for usage occasions and channels.

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Opportunity

Weakness

1. Marketing programmes

1. Distribution system needs to be upgraded as main goal is to

2. Product sampling

make it always available  –  3. Indian - rural

market has a

great potential -this sector is

within

an

arm‟s

reach

of 

desire.

 basically “Real Market” for its

products-intense

Research

should be done and a no. of  strategies should be evolved.

2. Per capita consumption is very low 3. Market regulation

Brand Positioning

Positioning of the different brands in the Indian soft - drink market can be analysed by the way the various brands have been advertised by their companies and the manner in which they are perceived by the consumers. Some of the key positioning based used by some of the leading brands are indicated bellow.

Youthfulness



Pepsi : "Generation Next", "Right Choice" Youthfulness fun with a

distinctly American connotation.



Coke : "Eat Cricket" Sleep Cricket, Drink only Coca - Cola"

Suggesting youthful drink.



ThumsUp : "Taste the Thunder", indicates adventure with all its

related connotations. Health



Limca : "With Isotonic Sales" - positioned as a balanced health

drink 



Slice : Aims at freshness of fruits and health

Fashionable



Fanta : Anything is possible



Campa-Cola : "The taste of the times"



Gold spot : "The Zin Thing" Placed as the “in drink” of the day



Mirinda : Miranda - a-a-a suggests light humour.

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User Status : Most consumers perceive soft drinks as a Thirst -

Quencher. A few segments can be defined based on the purpose behind the consumption.  Normal : The group of consumers who consume soft drinks as a thirst

quenching medium Select : The group of consumers who consume soft drinks as a diluting

medium for alcoholic beverages.  Elite : The group of consumers who prefer soft drinks to water. They

also offer soft drinks to guests Social : This group comprises of individual and institution who serve

soft drinks during social functions. This segment has emerged as the most rapidly growing market. The market strategy of Coca-Cola Revolves around



 Acceptability



 Availability



 Affordability

The emphasis is on these three fronts. Firstly they focus on distribution, their objective is to be

within arm’s reach of desire of 

every consumer, meaning than they should continue to implement

aggressive distribution strategies so as to former increase their reach to the millions in India. Secondly, building on acceptability and affordability, they aggressively continue to add value to the entire experience of drinking their products, enabling them to draw ever so closer to their consumer. Their focus is not on more market numbers but on the fluid intake. Internationally they consider their growth potential infinite, and India is the epitome of their growth potential infinite, Currently in India, the primary emphasis is to enhance their production and distribution systems to bring them to international levels. This will enable them to provide a choice from their brands to every potential consumer in any part of India. They are highly consumer driven company, and their objective is to drive volumes through advertisements. For e.g., their volumes increased by 64% in the 1st quarter of 196 as a result of their World cup Cricket initiatives. For the 1999 Cricketing season they launched an

innovative series of advertisements named “Experts”. Their strategy

was to further enhance their emotive association with the game of  cricket in general and Cricket fans in particular. This reinforces that whenever and wherever there is Cricket there is Always Coca -Cola. In 1993 Coca-Cola bought out Parle Exports: This was a sound

strategic decision on their part since it enabled them to obtain both, very strong brands and an excellent distribution network. However, at this point in time, Coca-Cola committed a strategic mistake. It overestimated the brand equity of Coca-Cola. However, in the 16 years that Coke was away. India saw a whole new generation growing up on other Colas. Millions of teenagers (probably a sizeable if not the biggest chunk of the Cola consumers) did not identify with Coca-Cola nor were they enamoured by Coke simply because of it being a global brand. The biggest mistake Coke did was to take the Indian consumer for granted. The company believed that it name alone coupled with global ad campaigns would be sufficient to tempt the Indian consumer to guzzle coke by the gallon. Coca-Cola, in love with the mother brand, neglected the star Indian brand Thums Up. Moreover, Coke employed its global positioning strategy of targeting at consumers from 8 to 80.

Coke was positioned as a thirst-quenching refreshing ice cold drink for all occasions. It also stuck on to its global strategy of high value advertising. It also used the same international advertising used globally instead of coming out with an Indianized version of the same. The culture of Coca-Cola keeps a straight face, the jacket and necktie types, remains tight – lipped is more American than Indian. Coca-Cola was restricted by its Atlanta-centric attitude. Previously all policy decisions had to be approved by Atlanta. The organizational culture was so restrictive that even an advertisement copy had to be sent to Atlanta for their approval. However, post 1997, when Donald Short replaced Richard P. Nicholas III, Coca-Cola India has seen a revolution of sorts. The new CEO of Coca-Cola International, Douglas Ivester has given Short a free hand with his mandate being to do whatever was right to drive up market share in India. This is responsible for Coca-Cola‟s recent change of image and its more aggressive marketing policies which are also being referred to as “Pepsization of Coke”. “Do the Right Thing”  Today it‟s a mission statement for Coca -Cola

India.

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Why study Consumer Behavior ? Understanding consumers and the consumption process brings a no of  benefits, among them the ability to assist managers in their decision making, provide marketing researchers with a knowledge base from which to analyze consumers, help legislators and regulators create laws and regulations concerning the purchase and sale of goods and services, and assist the average consumer in making better purchase decisions. Moreover, studying consumer behavior will enhance your understanding of the psychological, sociological and economic factors that influence all human behaviors. 1. Consumer analysis should be the foundation of marketing management. It assists managers to :

Design the marketing mix.



Segment the market place.



Position and differentiate products.



Perform an environmental analysis.



Develop market research studies.

2. Consumer behavior should play an important role in the development of public policy. 3. The study of consumer behavior will enable one to be a more effective consumer. 4. Consumer analysis provide 3 types of information :

Consumer orientation.



Facts about human behavior.



Theories to guide the thinking process.

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there was not much of taste difference between the two brands, for them a Cola remained a Cola. CONSUMERS REACTION

To know the consumers reaction towards the sales promotional activities undertaken by a company and whether it induces the consumer to switch brands, our survey indicated that 50% of the people are brand loyal, for them the taste of the drink was most important and they were not ready to change to another drink because of Sales promotional activities. Whereas 48% can change preferences if given attractive offers. They perceived these offers to be attractive enough for them to change brand. The rest 2% were undecided as it depended a lot to them as to what the offer was. An attractive offer could make them switch. MOST ATTRACTIVE SALES PROMOTIONAL ACTIVITIES

Amongst the different sales promotional activities undertaken, most people found Great Savers, Movie campaigns and Event Marketing as most attractive and widely accepted. Great Savers were perceived as convenient, because they are available to the consumer at their doorstep.

Movie campaign and Event marketing were equally preferred as Indians associate themselves most with movies and other forms of  entertainment. The Point of Purchase material displayed by the retailers influenced the consumer to alter his last minute decisions in favor of Coke. MAJOR RECENT CAMPAIGNS BY COKE

The Sales Promotion campaigns by Coke were divided into two main segments -- Movie campaigns Event campaigns. It was found that in the past 6 months among the Movie campaigns Hum Saath Saath Hai has been Coke's most successful strategy of 

promoting Coke. This was mainly due to the fact that the timing of the campaign was appropriate, with people associating Coke with the festive season Diwali and family togetherness which was the highlight of the movie Hum Saath Saath Hai. Next Movie campaign which was most remembered and liked was Taal, as Coke was very prominently displayed during the movie.

Among the events, Coke was most associated with the Coca-Cola Trophy, as cricket is part of an average Indian household. There was a wide coverage of the event and Coke advertised at strategic points on the field. One must also not forget the huge success of the coke gift packs during the

festive season of

Diwali

which were available in attractive

packaging targetting the kids. EFFECTS OF THE RECENT CAMPAIGNS

Based on our survey of Sales Promotion effectiveness of Coke we found that 69% of the respondents did not switch over to Coke or those who were already consuming did not consume more of it although they were quite popular and attractive. PERSONALITY MOST ASSOCIATED WITH COKE

The respondents were given six choices to choose from which were as follows :- Karisma Kapoor, Aamir Khan, Twinkle Khanna, Daler Mehndi, Saurav Ganguly and Javagal Srinath. This was to know whether the celebrity endorsements are successful and people identify with them and to see its effect on consumption patterns. Karisma Kapoor being one of the leading actress was the most associated with

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RECOMMENDATIONS TO THE COMPANY 1. Coke should carry on their celebrity endorsements with Karisma Kapoor and Aamir Khan as they have been highly successful, as they add aspirational value for the respondents. Coke should try and rope in popular teenage idols such as Aishwaria Rai and Salman Khan to cash in on their popularity. 2. Coke should increase their event marketing. Sponsoring college rock shows, road shows, international events and holidays will have positive effect on consumers as judged by the responses of the respondents through our questionnaire. 3. Viewing the increasing public awareness on social issues such as blood donation camps, aids awareness, environmental issues, Coke should try and start social awareness campaigns, which will be targeted both at youth and middle aged people. 4. More popular sports personalities should be targeted as has been the strategy of Pepsi.

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CONCLUSION This study has given a brief overview of the importance of Sales Promotion of Coca-Cola on Consumer Behavior. The responses received has shown clearly that the Sales Promotional strategies of the company seem to have clicked and have had a positive effect on its consumers. The major success in the recent time has been the personality endorsement specifically by Hritik Roshan,Aishwarya Rai,Aamir Khan Karisma Kapoor, its tie up with restaurant and movies like Hum Saath Saath Hai, the discount it gives in the form of Great Savers and the Coca-Cola trophy (Cricket). The reason behind all these successes could be attributed to the fact that Coke targets the typical Indian family, the Cricket freaks and the effect of Bollywood charisma on the typical Indian consumer. We have also tried to come up with certain recommendations through our analysis of the questionnaire which we feel will help the company in the long run.

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Coca-Cola provides retailers specific contests which allow them to be eligible to win prizes. Such schemes motivate the retailers to sell more of Coke products. According to the capabilities of the retailers, Coke managers set targets for them and if those are met the retailers are given gift upto the extent of free refrigerators etc. These schemes keep the retailers happy and in turn keep the sales high. The retailers are given billboards for their shops to be displayed which have the shops name and Coca-Cola endorses on it.

How Retailers help Coke : Every company wants that shopkeepers stock their and only their products. All manufacturers want this but the retailers are unable to do so because of space constraints. Coke loyal retailers, mostly motivated, display more of Coke than any other soft drink. They keep more of  Coke glow signs and posters and even try to influence consumers of  other soft drinks to consume Coke. This is solely due to the fact that Coke takes utmost care of it's retailers by giving them incentives, gifts and special offers. The relationship between them is such that both the parties mutually benefit.

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ASSUMPTIONS 1. Although Coca-Cola India has a large number of brands under its umbrella, like Fanta, Sprite, Thums-Up, Limca, Diet coke and Maaza but I have stressed only on t heir flagship brand “COKE” in order to avoid complications in the study. Most of the sales promotional strategies undertaken by the company have been endorsed through the brand COKE. 2. Coca-Cola has always given due importance to promotional activities so as to position itself as the top brand. Among all the strategies, we have taken only the last six months into consideration as these would be the freshest in the minds of the consumers.

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QUESTIONNAIRE NAME___________________ AGE ___ OCCUPATION ____________ 1. Do you drink soft drinks? Yes____

No____

2 How often do you drink? Daily___

Twice in 3 days_____

4Times in a week _____

Can‟t say_____ 

3 Which brand do you prefer ? Pepsi _______ Sprite ______ Mirinda _____ Fanta_______ Limca ______ Coke______

Seven up ______ Any other______

4 Which of the following reasons make you prefer the above chosen brand of soft drink? Price

______

Brand image_______ Taste

_______

Impulse _______ Can‟t say/other reason (please specify)_________  5 Do you recall any of the coke ads? Yes(please specify which one)___________ No______

6. Do you think that the new coke ad campaigns have encouraged you to prefer coke over any other rival brand?