Market Assessment of Coca Cola Company
This report will analyze the marketing environment of Coca-Cola brand looking into both the external and internal strategy of the brand both in the global and the Kenyan market. A situational and evaluative analysis will be conducted and different marketing challenges that Coca-Cola faces will be analyzed. 1. 1 Background of the Study Recognized in 1886, The Coca-Cola Company operated in more than 200 countries, and built markets of approximately 500 different brands and more than 3,000 beverage products around the world.
These products include sparkling (carbonated soft drinks) and still beverages, such as waters, juices and juice drinks, packet and bottled teas, coffees, sports and energy drinks. In Africa alone, Coca-Cola is identified to operate in all the territories around the continent. It is known as a global business that functions on a local scale in every community where Coca-Cola is identified to do business.
In each of the operated country, the Coca-Cola company employs local people, source local ingredients and produce and sell products locally, thereby directly and indirectly creating a high number of employment opportunities, investments and economic opportunities (Global Village Encyclopedia; Coca-Cola, Kenya). Coca-Cola Sabco’s Kenyan plant in Embakasi, Nairobi, employs approximately 1,000 people. It is one of the biggest bottling plants in the group. This state-of- the-art facility was officially opened by the former Kenyan president Mwai Kibaki in 2005 (Coca-Cola Sabco; Latest News 2013 – Kenya).
The establishment of the Embakasi plant was made possible by the tremendous success of its predecessors, Nairobi Bottlers Ltd (NBL) and Flamingo Bottlers Ltd in Nakuru, which together contributed to almost 50% of the country’s total volume. The two joined forces with East Kenya Bottlers Limited (EKBL) in 2002 and, in 2003, entered an exciting joint venture that is the Beverage Services Kenya Ltd (BSK) to boost their business further (Kenya News, 2013). Coca-Cola Sabco’s achievements in Kenya include the following: • In 1995, NBL received the ‘Highest Quality Award’ and was named Kenya’s ‘Bottler of the Year’.
• In 2003, EKBL was identified as the ‘Bottler of the Year’. • In 2007, NBL won two awards in the prestigious Company of the Year Awards for Kenyan companies and organizations. • In 2008, NBL won the first runner-up award in the prestigious ‘Company of the Year’ Award in Kenya. • In 2009, NBL won the Marketing award in the prestigious Company of the Years Award in Kenya. • Kenyans enjoy a wide range of beverages, including Coca-Cola, Coke Light, Sprite, Stoney, Dasani and those from the Krest, Schweppes and Sparletta groups. 1. 2 Purpose of the Study
The purpose of this study conducted is to identify the marketing strategies of the Coca-Cola Company and the marketing challenges it faces in the Kenyan market. To conduct a situational and evaluative analysis and identify its market segmentations and positioning strategies and provide recommendation on the challenges faced. The study also identifies its open opportunites and threats analyzing the external environment on the Kenyan market also putting into considerations its internal analysis of the company on its strengths and weaknesses (SWOT).
1. 3 Scope of the Study The study covers different marketing concepts and strategies in analyzing the situational analysis of the Coca-Cola Company in Kenya. Understanding the mission statement of the Coca-Cola company, a SWOT analysis is conducted to understand is its internal and external environment in terms of both negativity and positivity of its existence in the market. A market trend is also analyzed in terms of its technological and socio-cultural aspects of the customers.
A competitor’s analysis is conducted to identify the marketing challenges that Coca-Cola faces and later identifying its core competences that assists Coca-Cola raise up-heighted from its competitors. Market analysis for the Coca-Cola Company would also include the study on the Ansoff’s Matrix. Product analysis is then conducted with the help of the BCG matrix to further determine the market position of the Coca-Cola Company in Kenya. 2. 0 MISSION STATEMENT OF THE COCA-COLA COMPANY One of The Coca-Cola Company’s greatest strength lies in the ability to conduct business on a global scale while maintaining a local approach.
In order for the company to achieve its objectives and maximizing its stakeholder’s value, the company is known to be creating value by implementing comprehensive business strategies guided by its key actions and decisions (Awais, 2011). These include: • To refresh the world, the customers around them by refreshing beverages • To inspire moments of optimism and happiness by non-alcoholic beverages • To create value and make a difference in the beverage industry. 3. 0 SITUATION ANALYSIS 3. 1 Market Trends With the growing use of the internet and other electronic technologies, global communications is rapidly increasing.
This is allowing firms to collaborate within the country and international market. It has driven competition greatly as companies strive to be first-movers. Specifically, the global soft drink market’s compound annual growth rate is expected to expand to 3. 6% from 2004 – 2009 (Datamonitor, 2005). Taking note of the growing trends societal concerns, attitudes, and lifestyles are important to consumers. For instance, in Kenya now known as one of the developed countries in East Africa, people are becoming more concerned with a healthy lifestyle.
Consumer’s awareness of health issues such as obesity and inactive lifestyles represent a serious risk to the carbonated drinks sector. The trend is causing the industry’s business environment to change, as firms are differentiating their products in order to increase sales in a stagnant market. The low growth rates are of concern for soft drink companies, and several are creating new strategies to battle on with the new rates. Buyers want innovation with the products they buy (Datamonitor, 2005). In today’s globalizing society, being plain is not good enough to survive in a market.
In that manner, Coca-Cola company product line was expanded with varieties of different products suitable to the different target markets. Coca-Cola products would include, Coca-Cola, Diet Coke, Diet cherry Coke, cherry Coke, Coca-Cola with Lime, Coca-Cola with lemons and the product that the Coca-Cola Company introduced in its Juice sector, Minute-maid, Dasanimineral water, and many more (Leithwood, 2000). 3. 1. 1 PESTEL analysis for Coca-Cola The Coca Cola Company has its own weaknesses and strengths that can both affect the future performance of their respective business.
Analyzing the future constraints is an advantage for the companies since they can identify the possible factors that tend to leave an impact on their business. PESTLE analysis is a popular method that focuses in the external factors of the business and the environment where it operates. PESTLE stands for Political, Economic, Sociological, Technological, Legal, and Environmental. All of them examine the changes in the marketplace (Kotler, 2003). Political Analysis Political analysis examines the current and potential influences from political pressures.
Since Coca-Cola falls in the category under the FDA (Food and Drug Administration) and the government plays a role within the operation of manufacturing these products. In terms of regulations, the government has the power to set potential fines for the companies that did not meet their standard law requirement (Quinsy 2011). Other than that, the changes in the nature of business as non-alcoholic beverages can gain competitive product and pricing pressures and the ability to improve or maintain the share in sales in global market as a result of action by competitors.
Coca Cola however continuously monitors the policies and regulations set by the government. Nevertheless, it had faced a political issue when coke was noted to contain more than allowed content of sugar hence inviting other sociological concerns (Khansam 2011). Economic Analysis Economic analysis examines the local, national and world economy impact which also includes the issue of recession and inflation rates. The Coca-Cola Company has high sales in countries outside the U. S.
According to the Standard and Poor’s Industry surveys, “For major soft drink companies, there has been economic improvement in many major international markets, such as Japan, Brazil, and Africa. ” These markets will continue to play a major role in the success and stable growth for a majority of the non-alcoholic beverage industry. There is a low growth in the market for carbonated drinks, especially in Coca Cola’s main market, North America. The market growth recorded at only 1% in 2004 for North America (Hanna, 2012). Sociological Analysis
This analyzes the ways in which changes in society affect the organization such as changing in lifestyles and attitudes of the market. Consumers from the ages of 37 to 55 are also increasingly concerned with nutrition. There is a large population of the age range known as the baby boomers. Since many are reaching an older age in life they are becoming more concerned with increasing their longevity. This will continue to affect the non-alcoholic beverage industry by increasing the demand overall and in the healthier beverages.
The demand for carbonated drinks decreases and this pulled down the revenues of Coca Cola (Hanna, 2012). Technological Analysis Technology is the main focus of the analysis where the introduction and the emerging technological techniques are valued. This creates opportunities for new products and product improvements in terms of marketing and production. As the technology advances, new products are introduced into the market. The advancement in technology has led to the creation of cherry coke in 1985 but consumers still prefers the traditional taste of the original coke (Khansam 2011).
Legal Analysis Legal aspect focuses on the effect of the national and world legislation. The Coca Cola Company receives all the rights applicable in the nature of their business and every inventions and product developments are always going into the patented process. (Khansam 2011). Environmental Analysis Environmental analysis examines the local, national and world environmental issues. According to the data of the Coca Cola Company, all of the facilities are strictly monitored according to the environmental laws imposed by the government (Khansam 2011). 3.
2 Competitors Analysis VENTURES AFRICA – Global soft drinks giant, Coca-Cola, is set to face major a threat on its supremacy in the Kenyan market, as its rival PepsiCo, begins production at its new 2. 4 billion shilling ($28. 3 million ) plant in Kenya (Kenya News, 2013). PepsiCo exited the Kenyan market in the 1970s but made a re-entry in 2010 importing most of its products. The firm which recently advertised position for middle level employees is however expected to begin production of Pepsi Diet, Pepsi Cola, Seven Up, Everess, Mirinda and Soda Water later in the year.
Though Coca-Cola has easily brushed off smaller competitors in the Kenyan market, PepsiCo, which is the the world’s second largest food and beverage firm, has enough financial muscle to wrestle Coca- Cola (Business, Retail & Manufacturing, Strategies & Solutions, 2012). SABMiller, is also planning to enter the soft drinks market through its Kenyan subsidiary Crown Foods Ltd. Coca-Cola is also facing competition from Del Monte Kenya Ltd. which has dominated the ready to drink juice market with its Minute Maid brand, at a time Kenya’s middle class is becoming more health conscious and aware of health risks associated with soda.
A report was released by a US consumer watchdog that said Coca-Cola’s Coke brand contains cancer causing chemicals. The Centre for Science in the Public Interest said the Coke sold in Kenya had the second highest level of 4 methylimidizole (4-MI) in nine countries sampled. Though Coca-Cola’s general manager for East Africa Peter Njonjo termed the report as malicious (Kenya News, 2013). In a strategic move, Coca-Cola is also investing 5 billion shillings ($59 million) over the next three years to expand its production capacity and diversify into the juice market.
Other than competition, reduced consumer purchasing power caused by inflation, high interest rates and bad weather early in the year, are also a concern for Coca-Cola (Kenya News, 2013). 3. 2. 1 Porters Competitive Forces – Coca-Cola Company The soft drink industry is very competitive. The companies have to think about the pressures that are from the rival sellers within the industry, new entrants to the industry, substitute products, suppliers and buyers bargaining power. Coca-Cola’s largest competitors in this soft drink industry come from Pepsi Co. and the Cadbury Schweppes.
As they are also globally established, they create a greater amount of competition. Though Coca-Cola owns four of the top five soft drink brands (Coca-Cola, Diet Coke, Fanta and Sprite), it had lower sales in 2005 than did Pepsi Co. (Murray 2006). However, Coca-Cola has higher sales in the global market than Pepsi Co. In 2004, Pepsi Co. dominated North America with sales of $22 billion, whereas Coca-Cola only had about $6. 6 billion, with more of their sales coming from the overseas. PepsiCo. is the main competitor for Coca-Cola and these two brands have been in a power struggle for years (Murray 2006).
Brand name loyalty is another competitive pressure. Diet Pepsi ranked 17th and Diet Coke ranked 36th as having the most loyal customers to their brands. The new competition between rival sellers is to create new varieties of soft drinks, such as Cherry Coke and Vanilla Coke, in order to keep increasing sales and enticing new customers. New Entrants: New Entrants are not known to be a strong competitive pressure on Coca-Cola as for the soft drink industry. Coca-Cola apparently dominates the industry with their strong brand name and large distribution channels. Furthermore, the soft drink industry is fully saturated and growth is small.
This makes it very difficult for the new and unknown entrants to start competing against the existing firms (Deichart, 2006). Another barrier to entry is high fixed costs for warehouse, trucks and labor, and economies of scale. New entrants cannot compete in price without economies of scale. These high capital requirements and market saturation make it extremely difficult for companies to enter the soft drink industry; therefore new entrants are not a strong competitive force (Ellenbecker, 2007). Substitute Products: Substitute product are those competitors that are not in the soft drink industry.
Such substitutes for Coca-Cola products are bottled water, sports drinks, coffee and tea. Bottled water and sports and energy drinks are increasing popular with the trend to be a more health conscious consumer. There are progressively more varieties in the water and sports drinks that appeal to different consumer’s tastes, but also appear healthier than soft drinks. In addition, coffee and tea are competitive substitutes product because they provide caffeine. For consumers to switch for substitute product, Coca-Cola also has its own bottled water, Diet Coke, Coke Zero counters for such products.
It is also very cheap for consumers to switch to these substitutes making the threat of substitute product very strong (Datamonitor, 2005). Suppliers: Suppliers for the soft drink industry do not hold much competitive pressure. CocaCola is bottling equipment manufacturers and secondary packaging suppliers. Although CocaCola does not do any bottling, the company owns about 36% of Coca-Cola Enterprises which is the largest Coke bottler in the world. (Murray 2006) Since Coca-Cola owns the majority of the bottler, that particular supplier does not hold much bargaining power.
In terms of equipment manufacturers, the suppliers are generally providing the same products. The number of equipment suppliers in not in short supply, then it becomes fairly easy for a company to switch suppliers. This takes away much of supplier’s bargaining power. The buyers of the Coca-Cola and other soft drinks are mainly large grocers, discounts stores and restaurants. The soft drink companies distribute the beverages to these stores for resale to the consumer (Ellenbecker, 2007). Buyers’ bargaining power: The bargaining power of the buyers is very evident and strong.
Large grocers and discount stores buy large volumes of the soft drinks, all owing them to buy at lower prices. Restaurants have less bargaining power because they do not order a large volume. However, with the number of people who are drinking less soft drink, the bargaining power of the buyers could start increasing due to decreasing buyer demand. (Datamonitor, 2005) 3. 3 SWOT Analysis of Coca-Cola Company The SWOT analysis of Coca-Cola – this is a simple analysis used to identify and evaluate the external and internal analysis of Coca-Cola Company with the Strengths, Weaknesses, Opportunities and Threats.
WEAKNESSES STRENGTHS • Strong leading brands with high levels • Financial market volatility impacting of consumer acceptance – this allows the company to extend its product to position of the company (Victian, attract new customers. (Bazil, 2013) • pension assets and in turn the liquidity 2011) Large scale of operations – Coca-Cola • Big slow decision making can give products have already sold in over 200 competitive advantage to the countries. In addition, it records its competitors, specifically to Pepsi Co. revenues in millions of dollars making by being the first to introduce a certain
it the largest manufacturer in the product for example (Bazil, 2013). industry (Bazil, 2013) • Leading market position – the brand is about 5% ahead of its main competitor, i. e. Pepsi Co. in the market (Vitian, 2011) • Strong cash flows from operations – the brand is capable of creating over $50 million a day (Bazil 2013) OPPORTUNITIES • Global growth in the non-alcoholic read THREATS • Economic climate – countries from all to-drink beverage industry – this trend over the world have felt the impacts of is set to generate retail sale in the the current recession. This may be
industry to more than $1 trillion by problem for Coke, which derives 2020 (Bobby 2003). approximately 75% of its sales from outside Africa (Vitian, 2011) • Growing global bottle water market with intense competition (Bobby 2003). • Health and wellness had created concern for carbonated products • Booming global functional drinks especially in the developed countries market; e. g. energy drinks (Vitian, like Kenya and other westernized ares 2011) • like the USA and Europe (Bobby 2003). Target the ageing customers and the young and more environmental concerned people (Vitian, 2011) •
Over – dependencies on bottling partners (Vitian, 2011) • Intense competition – either in local or global markets, or both (Bobby 2003). 4. 0 EVALUATIVE ANALYSIS Kenya’s brand terrain is littered with many brands. Some are as old as Kenya while others are relatively new having made it to the scene in the 21st Century. Amongst these brands, there are those that boast of having a special place in the hearts and minds of Kenyan consumers. CocaCola is one of these brands having been in existence for the last 125 years and still very fresh, funky, cool, warm and an exciting brand that has remained ‘young’.
Studies have shown that Coca-Cola is among the most-admired and best-known trademarks in the world. In fact, it is documented that “Coca-Cola” is the second-most widely understood term in the world, after “okay. ” 4. 1 Marketing Mix of Coca – Cola Coca cola is the brand with the highest brand equity. No doubt it has gone through the ups and downs of business to reach that position. The marketing mix of Coca cola has been changing over time with more and more products being added such that today it has 3300 products. However the 4 P’s that is the Product, Price, Place and Promotion, have be analyzed as below.
Product The Coca-Cola Company has the widest portfolio in beverage industry comprising of 3300 products. Beverages are divided into diet category, 100% fruit juices, fruit drinks, water, energy drinks, tea and coffee etc. As per Nielson’s data, Coca cola is the No. 1 brand in sparkling beverages, juice, and retail packaged water in 2010. Coca cola has its market presence around 200 countries. Coca cola brands in Kenya are Fanta, Maaza, Sprite, Thums up, Minute Maid, Nested iced tea etc. Figure 1 below identifies Coca-Cola’s share in beverage categories (Sharma, 2013)
Figure 1: Coca-Cola’s share in beverage categories (Spencer, 2011) Product-life cycle: To be able to market its product properly, a business must be aware of the product life cycle of its product. The standard product life cycle tends to have five phases: Development, Introduction, Growth, Maturity and Decline. Coca-Cola is currently in the maturity stage, which is evidenced primarily by the fact that they have a large, loyal group of stable customers. Furthermore, cost management, product differentiation and marketing have become more important as growth slows and market share becomes the key determinant of profitability.
In foreign markets the product life cycle is in more of a growth trend Coke’s advantage in this area is mainly due to its establishment strong branding and it is now able to use this area of stable profitability to subsidize the domestic Cola Wars. Figure 2 below indicates a diagram of product life cycle curve for better understanding (Shriam, 2009). Figure 2: Product Life Cycle Curve (Shriam, 2009) Price Due to the availability of wide range products the pricing is done according to the market and geographic segment. Each sub-brand of coca cola has different pricing strategy.
Their pricing strategy is based on the competitors pricing, Pepsi is the direct competitor to coke. Beverage market is said to be a oligopoly market (few sellers and large buyers), hence they form into cartel contract to ensure a mutual balance in pricing between the sellers (Sandeep, 2003). Place Coca cola is the world’s most favorite brand and is available all over the world. The distribution system of coca cola follows the FMCG distribution pattern. The effective distribution network of coke has almost eroded the small and middle level players in the market.
In Kenya they have captured even the rural market by extensive distribution and have eroded the market share of Nairobi, Nakuru, Mombasa, etc (Shriam, 2009). Promotion Coca cola adopts various advertising and promotional strategies to create an increased demand in the market by associating with life style and behaviour and mainly targeting value based advertising. A coke advertisement is most likely to be seen individualized for a particular festival or in with a general positive message. Coca cola uses corporate social responsibility (CSR) as its marketing tool to gain emotional benefits in consumers mind.
The current promotions through CSR include “Support my school” campaign with NDTV – India. It has many brand ambassadors like Shahrukh khan, Hrithik Roshan, South Indian Actor Vijay and Trisha , Hollywood actor Tom Cruise, Brad Pitt, Angelina Jolie, Julia Roberts, Indian cricketer Ghambir, etc. It allows price discounts and allowances to distributors and retailers in order to push more products into the market. It employs both push strategy through promotions and pull strategy through advertisements and campaigns (Sandeep, 2003). 4. 1.
1 Distribution Strategy for Coca Cola The Coca-Cola company operates a franchised distribution system dating from 1889 where The Coca-Cola Company only produced syrup concentrate which is then sold to various bottlers throughout the world who hold an exclusive territory. The Coca-Cola Company owns its anchor bottler in North America, Coca-Cola Refreshments. (Upadhyay, 2007) The company is headquartered in Atlanta, Georgia. However, in the all countries that Coca-Cola has attained its brand usually makes two types of selling (George, 2009): •
Direct selling: In direct selling they supply their products in shops by using their own transports. They have a number of vehicles to supply their bottles. In this type of selling company have more profit margin. • Indirect selling: They have their whole sellers and agencies to cover all area. Because it is very difficult for them to cover all area in a country by their own so they have so many whole sellers and agencies to assure their customers for availability of coca cola products. 4. 1. 2 Ansoff’s Matrix for Coca-Cola Company
Ansoff’s matrix is a useful tool for examining a company’s product range. This compares the alternatives of developing new products and new markets (Awais, 2003). There are four main options: 1. Market penetration: selling more of the same types of product to the same types of people. 2. Product development: building on existing relationships with consumers and on a creative ability to develop new products suited to consumer wants. 3. Market development: developing an existing product to cater for emerging markets. 4. Diversification: developing new products for new markets.
Coca-Cola Great Britain | Using market research to develop a product range (Awais, 2003) Information about some of the products produced by Coca Cola is given below. 1. Market Penetration: Diet Coke Since being introduced in 1982 as a result of a growing trend towards dieting and healthier living, Diet Coke has been a highly successful product for the Coca Cola company, selling millions of units per year. Throughout this time, Coca Cola has constantly adapted aspects of the marketing mix for Diet Coke in order to continually match customer trends and fashions (Haiban, 2012).
2. Market Development: Coca-Cola Share size Desk research showed Coca Cola that a growing number of households contained 1-2 people, which led them to believe that a smaller version of the 2 litre family sized bottle would sell well to these groups. In launching this product (simply sell existing brands such as Coca Cola, Diet Coke etc) (Michaele, 2004) 3. Product Development: Fanta Icy Lemon; Coca-Cola Cherry Having had a successful launch in Africa, Coca Cola decided to launch it’s new Cherry flavored version in the East Africa.
Prior to doing so, Coca Cola carried out taste tests and developed the graphical ‘look’ of the Diet Coke brand. When they did this, they took great care to incorporate aspects of the Coca Cola brand, but still differentiating it so consumers would see it as an alternative to Coke (Michaele, 2004). The development of a new flavour sparkling drink by Coca Cola was as a direct result of listening to consumers who called the company’s Care line telephone service. The business conducted taste tests prior to the 2001 launch.
This build an image in the consumers mind on a new product that coca-cola has launched (Michaele, 2004). 4. Diversification: Power-rade; Winnie the Pooh Roo Juice by Coca Cola Coca-Cola was mainly known of its carbonated drinks. When its target market was more of seen to becoming health conscious and careful, Coca-Cola diversified its market to produce juice and energy drinks which had better health benefits to serve its market with in order to stay into firm competitions with its other base competitors such as Del Monte manufacturing Minute Maid juice most preferable by the health conscious market (Haiban, 2012).
4. 1. 3 BCG Matrix for Coca-Cola Company Organizations with a broader range of products and services or in general superior organizations usually find it difficult to analyze in what percentage their resources should be allocated with different business units. Any organization is known to hit a success level if it concentrates on its strengths and remain keen on not to touch its weaknesses, as well as to further explore its conspicuous opportunities that will invite in a maximum benefit for the organization (Jagwani, 2009)
Boston Consulting Group matrix (BCG Matrix) provides a basic understanding on the interrelation between the market share value of a certain commodity and its market growth. It is known to be a two-dimensional analysis on the management of Small business unit (SBU) (David A. Aaker; Strategic Market Management; Forth Edition). Nevertheless it is also known to be a proportional analysis of business potentials and the examination of it market environment. The Small Business Units in the BCG matrix are categorized into four groups, that is, The Stars, The Cash Cows, The Question mark and The Dogs.
Figure 3: BCG Matrix for Coca-Cola Company For the case of Coca-Cola Company, it is one of the world largest and famous brands in the beverages industry and it is well renowned worldwide for the variety of beverage products; over 3500 products worldwide that it offers and its thick investments on research and development providing constant product innovation. Since Coca-Cola offer a variety of product, it may be difficult to analyze its market position according to the BCG matrix.
Nevertheless, below is the BCG matrix analysis for the Coca-Cola Company (Gyamfi, 2012). Stars These are the business units that lead their rivals in the market place having larger market share value and with higher opportunities in the market for growth. The businesses in this category usually require high investments to constantly survive in the market (Stern, 2012). For the case of Coca-Cola, Thumbs-Up, Maaza and the Mineral water bottle, Kinsley and Dasani can be grouped under this category.
This is due to the fact that all of these product yet require continuous investments on improvements on preferable tastes and that there are also bigger opportunities accessible in the market for growth (Jagwani, 2009). There are however other rivals such as those products offered b Pepsi Co, providing similar competition. However Coca-Cola is known to be ahead of Pepsi Co. in terms of share value on these star products. All business organizations require Stars that shall with time become cash cows that prove critical for future improvement of cash flows.
Cash Cows These are products with which an organization enjoys the leading market share value but does not have any further market growth. The products in these category are matured enough in the market and hence do not require further investment (Stern, 2012). For the case of Coca-Cola, its lead product Coke and Limca can be categorized into this section with approximately 70% (plus) market share value with its closest rival Pepsi Co. (with 20% of relative market share) on its core pepsi product.
In this case, the core product of Coca-Cola, the Coke, has apparently won over all its rivals in the market segment (Jagwani, 2009). This therefore indicates that Coke is now a matured product and its stable enough to survive the market, hence it requires no further investments on product innovation. The cash flow that is generated under the sales of Coke, Limca and some of its other star products that are likely to lead to becoming cash cows may therefore be enough to invest on question mark products.
Question Marks These are usually the products that have a low market share but have high growth opportunities. If further investments are placed on such products, there are chances for the product to acquire higher market share. Organization managements usually face rick analytic questions on which products to invest on and which shall require further priorities. If products in this category are not taken into appropriate consideration, there are most likely to fall into the Dogs category (Stern, 2012).
The Coca-Cola products, Fanta and Sprite are to be categorized in the Question Mark category. The Fanta and Sprite relatively acquire a very minimum market share, but has growth opportunities with investments on its different flavors. However, the decision on the investment of Fanta and Sprite apparently becomes difficult due to its preference level being low in the market. If more product innovation in terms of taste and preference is placed on these Coca-Cola products, than it does have an opportunity to grow (Jagwani, 2