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Coca Cola’s International Marketing Strategy Syed Hassan Raza
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Abstract This paper covers the global marketing strategies of Coca Cola Company, It provides information how different strategies of coke failed and how coke learned to customize it strategies and creating a blend of o f two strategies which help coke gain its market share back from its long term rival Pepsi. The introduction gives understanding about what global marketing is and what are two main strategies used in global marketing. Then it main body follows it by telling us how and when coke used different strategies. Finally, conclusion tells how global marketing strategies can’t be rigid and how coke c oke is still same even with different marketing mix in different countries.
Introduction When domestic markets become mature many companies start to expand their operations to other countries to achieve growth. New technologies, better ways of communication and faster transport has turned this world into a global village, making international markets more accessible, and businesses pursuing a global position get the benefits of increase in brand awareness and cost effectiveness. All these developments created a new concept global marketing (Mughal, 2005). Global marketing cover two main strategies for promoting products across country,
Standardization Companies using standardization strategy use centralized management system, they use same marketing mix plan which they are using in home country. This leads to achieve
3 greater economies of scale by discounts through bulk purchases and by sharing some functions like product development and marketing.
Adoption In this strategy a customized marketing mix is created for every country and region. Following this strategy may cost more then standardization but it gives the benefit of consumer diversity.
Coca Cola’s Global Marketing Strategy Coca cola, being the world’s largest manufacturer of non-alcoholic beverages, is certainly well aware of global marketing. It operates in 200 countries and is one of the most recognizable brands throughout whole world. Coca cola has changed it global marketing strategy from times to times in last 15 years. In 1996 coke adopted standardization strategy and was very rigid about it. The company wanted to take same flavour of coke to all countiers across the world while keeping all elements of marketing mix same, as coke’s CEO that time, Roberto Goizueta said, “The labels ‘international’ and ‘domestic’…no longer apply.”(Press realese, 1996). In those times coke’s strategy was represented by tagline “think global, act global.” Goizueta’s strategy proved successful for the time being as coke earned 67% of its total revenues and 77% of its total profit outside North America. But soon due to currency cu rrency crisis in asian countries led this strategy to failure and when Daft took charge of the company in the end of 1999, its stock had gone down to one third of its value. After facing the loss of around $70 dollors Daft decided to change strategy in
4 completely opposite way. He said that, “no on drink globally. Local people get thirsty and they but a local made cola(Press realese, 1999) But unfoutunately for coca cola this strategy didn’t proved much successful. After 2 years of repeating mantra of “think local, act local”, marketing was once again took over by head office in Atlanta in 2002. In 2002 coca cola adopted a unique strategy, in this new strategy local marketers were guided by the marketers form head office. This new strategy was a less rigid and customized form of standardzation strategy. Under this strategy coke made little changes in market mix for every country like in some countries it used sugar and in some countries it used corn syrup, it aslo droped its universal tag line “life tastes good” in many countries and replaced it with more local tag lines. This strategy is still in use by coke and is proving to much more successful then previous strategies. It kept coke’s branding but allowed others elements product, price, placement and promotion customize according to the local market.
Conclusion: When serving in global market global efficiency should be achived by integrating and cooridinating operations across the world, but at the same time remaining responsive to the local market. That’s exactly what coca cola is doing since 2002. Its different in every country but its still the same old coke you are used to. Its brand is recognized through the whole world with same favor.
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