...COKE CASE STUDY: ISSUES IN THE GLOBAL SECTOR BY COREY J. GRIFFIN Coke is a major product brand that has grown from 1886 to becoming the number 1 brand in the world according to Interbrand’s Global Scorecard in 2003. All this success has not come with a little hardship, due to the fact that Coke is a global brand. Just as it was seen in the Nike case study, when a company becomes globalized it is hard to monitor and maintain every sector of the product name. On August 5, 2003 the CSE (Center for Science and Environment) released a critical press release that name 12 soft drinks brands, Coke brand included, that were sold in and around Delhi to have contain a deadly pesticide residues (CSE Press Release, “Hard Truths about Soft Drinks, 5 Aug 2003). CSE claimed that these dangerous pesticides were known to cause cancer, cause failure of the nervous and reproductive systems, birth defects, and damage to the immune system. Along with the hazardous chemicals found by CSE, there were very limited regulations in place for this industry to follow. These soft drink companies were receiving exemptions for the industrial licensing under the Industries (Development and Regulation) Act of 1951 that would have probably had a chance to take notice to these soft drink contamination events (CSE Press Release, 5 Aug 2003). In response to these very strong allegations from the Center for Science and Environment, Coke Enterprise of India launched their own internal investigation...
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...PEST CASE STUDY: COCA COLA PEST analysis examines changes in a marketplace caused by Political, Economical, Social and Technological factors. Look at the following statements abstracted from various sources, and group them under the following headings: Political; Economic; Social; Technological After the shock of the attacks on September 11, 2001, and despite the debilitating effect of the Iraq War, the USA’s economy had returned to sustained growth by 2006. However, things have changed quite dramatically recently; following the sub-prime loan catastrophe in the housing market, the economy is again in trouble. Most economists are now predicting a severe recession (negative growth for a year or more), and some predict depression (prolonged recession and contraction of the economy by more than 10 per cent). There have been recent major government interventions around the world, most notably in the banking sector, in an attempt to prevent the world economy from following the USA in a downwards spiral; it is too early to tell if, how and when these efforts will be successful. The recent election of Barack Obama as president is seen by many as a glimmer of hope, but it is recognised that once he takes office on January 20th 2009 he will be inundated with a whole sheaf of major internal problems that will take time, ingenuity and cash to sort out. Internationally, the range of political instabilities, civil unrest, military posturing, protectionism, economic distress, and other...
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...Chapter Eight Case Study - Coke Zero Coke Zero Coca Cola has been the leader in the soft drink market for decades, consistently besting their nearest competitor, Pepsi. The struggle for the top spot has been on-going for over one hundred years, and at times has been fairly interesting. Both companies have been trying new strategies, flavors; can designs and even recipe changes in order to gain market share, niche competitive advantage as well as a sustainable competitive advantage. (Lamb, Hair Jr., & McDaniel, 2013, p. 26) Both companies constantly change their products and their marketing techniques in order to secure an advantage over one another. Coca Cola over the years has used common good business practices in order to evaluate their business, so they would know which direction to take it, next. Sometimes their choices were effective, other times they were not. A Coca-Cola marketing situation comes to mind going back to 1985, when seemingly out of the blue, Coke changed their formula. The onslaught of public outcry then began, forcing Coca Cola to re-think their strategy and into damage control mode. It was either a brilliant strategy designed to be a publicity stunt, or one of the worse blunders ever in corporate America. The answer is still not clear to this day, however the results were interesting and have been fodder for Marketing classes ever since. News about the “New Coke” dominated the airwaves for weeks on end, and people rushed out to try it. Most did...
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...Case Study – Coke in India Adapted by Lesley Fleischman from: Hills, Jonathan and Welford, Richard. Corporate Social Responsibility and Environmental Management. 12, 168–177 (2005) August 2003 • • • • • October 2003 • • Coke has 44 wholly owned and franchise owned bottling plants in India Indian NGO finds that Coke and Pepsi products bottled in India contain pesticides. Immediate impact on Coke stock price. Coke threatened legal action over allegations. Indian government tests confirm findings. Coke hires PR firm, develops strategy to deflect media attention away Escalating community protests at bottling plants, demonstrations, hunger strikes, etc. December 2003 February 2004 March 2004 • • • • • • • • June 2004 • • • September 2004 • • October 2004 • • • February 2005 • • April 2005 • • May 2005 • • Ordered by Indian court to stop drawing groundwater for its bottling plant in Plachimada, Kerala Judge ruled that no power to allow a private party to extract such a huge quantity of groundwater Protesters claim that Coke water use was reducing agricultural yields Coke cited lack of rainfall, not their operations, as cause of crop declines Parliamentary committee finds high amounts of pesticide residue in Coke and Pepsi products bottled in India Not illegal, Indian safety standards weak Coke application for new bottling plant in Plachimada denied by local authorities because...
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...Case Study: Coke Zero I highly agree with the statement that “companies should develop products what will bring new customers into market rather than just creating variants on the old” (Lamb et al. 289) because when old products failed, it is an opportunity for the company to invest in different market segments— “a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs” (Lamb et al. 261)—that could potentially increase additional consumers. For instance, Coke Cherry has been the “dog”— a “poor performer [and]it has only a small share of a slow-growth market” (Draft 213)— product line compared to other successful drinks such as Diet Coke, Coke Zero, and regular Coke. Thus, managers must foresee the concept: why continuing to invest in older products that do not produce profits and lose additional money in the investment; hence, why not take the risk of manufacturing new products that could be the “cash cow”—the “dominant business in the industry, with a large market share” (Daft 213)—in the market? Diet Coke and Coke Zero are the “star”, which have “additional growth potential” (Daft 213) and “will generate profits and a positive cash flow” (Daft 213). Both Diet Coke and Coke Zero are concentrating on the demographic segmentation—“segmenting markets by age, gender, income, ethic background, and family life cycle” (Lamb et al. 265)—by particularly age; therefore, the target market of Diet Coke and Coke...
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...envision, from a broader perspective, the operation of an organization and the market one serves. You must learn to think, act, speak, and process from the “management mind.” This capstone course draws from all functional areas of an enterprise to provide strategic direction to an organization. It also provides engineers with a management perspective as a complement to the engineering orientation, which they currently possess. Strategies are offered to ensure not only success in a competitive “for profit” environment, but the sustainability of success throughout the economic cycle. A framework is developed to understand the interrelation of accounting, finance, operations, engineering, and marketing. Class format will be lecture, case study analysis, open discussion, guest speakers, and student presentation. Student Notice: As a...
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...Nike Case Study Tracy Weispfenning Nike Case Study #1 MGMT 310 Jason Cussler January 31, 2014 Nike Falters in Ethical Practices Nike has faced many ethical dilemmas such as human rights abuses, labor violations, and negative impact on the environment where manufacturing plants are located. Their responses have varied from improving labor standards in each facility to implementing a recycling program for worn out shoes for the consumer, and creating a no waste recycling program at all levels of the Nike operations. In my opinion, Nike is on the right track but could do more in their response to these ethical challenges. Nike has responded to these ethical dilemmas in various ways. They’ve done a good job in anticipating the potential consequences, yet they have not involved enough people in the decision making process. For example, Nike did not take the allegations of human rights abuses and labor violations seriously in their overseas manufacturing plants until nongovernment organizations like Life magazine and The New York Times published articles on these violations. These articles created public awareness and exposed the lack of oversight and policies to ensure the human rights and labor guidelines were fair and enforced. After these articles were published, Nike obtained and implemented a new course of action for protecting workers rights, safety, and competitive wages. Nike should have been aware of these practices, monitoring and reviewing their...
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...5) How can Pepsi and Coke confront the issues of water use in the manufacture of their products? How can they defuse further boycotts or demonstrations against their products? How effective are activist groups like the one that launched the campaign in California? Should Coke address the group directly or just let the furor subside? Pepsi and Coke should have responded faster to the concerns of the general public. The companies formed committees within India and the United States to work on legal and public relations issues. They commissioned their own laboratories to conduct tests and waited until the results came through before commenting in detail. Their approaches backfired. Their reluctance to give details fanned consumer suspicion. If the companies acted faster to the situation when it first came to light, the could have spared a lot of grief. Pepsi and Coke can defuse further boycotts by speaking directly to the cause of the boycott/demonstration or by allowing demonstrators to investigate their product themselves. The activists groups have proven to be very effective in their efforts. Fear campaigns (like the ones assembled in California) can do a great deal of damage to the brand. They are even more effective when the people targeted are not in the country being referred to as in this case (America/India). They are unable to use their own judgement to dismiss the campaign. Moreover, Coke should address the group directly in order to sort out any misunderstandings as...
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...successful, especially Coke and Pepsi. Coke started as a “potion for mental and physical disorders,” sold by a pharmacist named John Pemberton. The Coke business evolved quickly and reached franchises by 1910. The concentrate business and the bottling business, though closely related have very different economic dynamics. The profitability of concentrate producers was much more successful than bottler’s. Even though the profitability of concentrate producers is higher than bottler’s they are still inter-reliant; they share cost in things such as marketing and production. There are many reasons why concentrate was financially successful; using Porter’s five forces we can noticeably see how each force plays an intrical role in profitability. Bottlers and concentrate businesses deal with the same buyers and suppliers. There were many suppliers that could provide raw material to concentrate business owners; therefore suppliers could not ask a premium and their power was low. Bottling businesses, much like suppliers were dependent on concentrate businesses. In reference to the five forces model, concentrate producers supplied bottlers with raw material necessary to make soft drinks. Concentrate businesses took management roles in product development and even negotiated with bottlers. Therefore, it is evident that concentrate business had control in the industry. In addition, there was a high volume of suppliers so that made negotiations impossible. Both Coke and Pepsi made strategic...
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...Managerial Economics Coke vs. Pepsi: An Economic Analysis Rebecca Simmons Managerial Economics Dr Sol Drescher December 4, 2012 Executive Summary In this case study we will do an economic analysis of two major competitors; Coke® and Pepsi®. We will look at the history of these to competitive giants and discuss how they have evolved over the years to become rivals in the 21st Century. In this case study we will also look at the supply and demand of each company’s products. Coke and Pepsi are not only in the beverage business they have branched out into other arenas to continue being the leaders in their market. Both companies do business all over the world; we will also look at how they size up internationally as well as nationally. We will look at production and cost in the short run and long run by analyzing each company economically. Each company has foreta where they will be financially in the 21st Century and in this analysis we will calculate if they have forecasted close to where they are today. Management is a big part of the success of large firms such as Coke and Pepsi so we will look at the management styles of each one. By looking at management will analyze the strategic decision making of each firm and note any issues they have had in the past or present with upper management. Finally strategic decisions in oligopoly markets with regards to profit maximization is vital to the...
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...gain new customers. 2. How would you evaluate the crisis? On a scale from 1-10 ten being the worst I would say it’s about an 8. No company that is involved in the food and beverage industry she be able to get away with what Coca-Cola did. Findings and statistics don’t lie, so on paper it seems as though Coca-Cola was purposefully taking advantage of the less enforced rules and regulations that they had to follow in India, most likely to save a couple of bucks though it was not violating any laws. 3. How well prepared was Coke India to deal with the CSE’s allegations? In terms of the amount of time it took them to respond to the media I think they did a great job. They denied the allegations and also made a promise to show data that proves the safety of their manufacturing and products. Both Coke and Pepsi attacked the CSE by questioning their credibility. Coke India also threatened legal action against the CSE which made it look as if Coke had the upper hand. 4. What is your recommendation for Coke’s communication strategy? Who are the key constituents? If I were Gupta I would continue handling the situation as he did right from the beginning. By questioning the credibility of the CSE and showing the public findings that their products are safe and made in a...
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...from end of case 1. Diet Coke: It seems to be common that only women drink diet coke since it has less calories, low sodium, and low carbs than the original Coke. There are only a few males that drink diet coke compared to the large amount of females that drink it. Diet coke would be based on gender segmentation. Coke Zero: This product is more of a young male drink. Although it doesn’t have sugar and the calories people tend to like the artificial sweetener, which makes it drinkable. I personally don’t see a difference in drinking Coke Zero or Diet Coke, both tastes the same to me. Males didn’t want to be seen drinking Diet Coke so they prefer drinking Coke Zero. This product would fall under gender and age segmentation. Diet Coke Plus: Diet Coke Plus would also be considered a female drink since its part of the Diet Coke family. This product is for the females who are concerned about health and nutrition as well as losing weight. Diet Coke Plus would be considered gender segmentation. Coca-Cola Blak: This product is especially for older Males and Females who are more sophisticated and are willing to pay a little extra. Coca-Cola Blak would be age, gender, and income segmentation. Full Throttle Blue Dragon: This energy drink is an attraction for young Hispanic males who want a little kick to the energy drink. This product would categorize under age, gender, and ethnic segmentation. 2. Coke Zero is most likely to affect sales of Coke and Diet Coke with selling...
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...Lauren Wang MKTG 211 002 Response 6 My biggest takeaway from this lecture was that given the number of times we use heuristics to make both everyday and large decisions, and how many errors we make when using heuristics, us as consumers must make many mistakes when using peripheral routes of processing. For example, using frequency heuristics is often inaccurate and highly subjective based on the person and the information available to them. This is definitely apparent to me when making minor decisions such as where to eat for dinner. When thinking about risk, incidences that are more interesting or shocking to consumers are a lot more known and have a lot more prevalence in media, creating the availability bias that these incidences occur more than they do. This could be hazardous for risks that are less “sexy” and that people do not think a lot about. For example, in the example of estimates of deaths from accident vs. diabetes, the actual result where diabetes is four times more likely to occur than an accident is frightening. Consumers should be more cautious of preventing diabetes. Without this awareness due to selective media coverage, consumers are focusing on the wrong things that could be detrimental to their health or wellbeing. I have learnt about the law of large numbers from my statistics classes, but learning about the law of small numbers showed me how people tend to exaggerate the degree to which a small sample will resemble...
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...Barnes & Noble Vs. Amazon To attain a competitive advantage over Amazon.com, Barnes & Noble needs to develop a proper strategy and implement a successful marketing plan. SITUATION ANALYSIS Barnes & Noble first must consider the issues and problems facing their company, and then perform an opportunity analysis to determine their strengths and weaknesses in relation to their customers, competitors, and company capabilities. In regards to the main concerns of Barnes & Noble, the company needs to worry about the uncertainties associated with the expected rapid growth of the Internet, the changing profile of Internet users, increased competition and indeterminate future developments in electronic retailing from publishers, wholesalers, and retailers, and intense price competition. By 2000, more than 80 million users will be on the World Wide Web, with an increase in females and a broader spectrum of education levels and age, changing the market demographics. Additionally, some book publishers, namely Simon & Schuster and Bertelsmann, have expanded online, while the national leading wholesaler, Ingram, is developing a website where wholesalers could ship directly to consumers. In the meantime, small publishers and universities have started to publish directly on the Web, avoiding print versions completely and thereby challenging the posterity of conventional books. Within the Barnes & Noble Corporation, their smaller traditional bookstores such...
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...Mr. Marchionne will attempt to integrate Fiat and Chrysler by developing Fiat’s newer models with Chrysler for a number of brands, as well as sharing parts, platforms and plants to become a more efficient manufacturer. Another attempt by Mr. Marchionne is to take advantage of Chrysler's dealership network in the U.S. to sell its own cars and reduce its exposure to Europe. The integration of Fiat and Chrysler will augment its economies of scale to have an advantage in competing against their rivals in the global market. Mr. Durban's reputation is known for being savvy with technology. This reputation was given to him because of his deal to take Dell private. If it becomes approved by Dell shareholders, it would be the largest corporation privatization since the financial crisis. Mr. Durban works for Sliver Lake Partners, a private-equity firm which focuses on investing exclusively in the tech industry, saw value in Dell's software and services operations, which allows him to gain knowledge about technologies. Another reputation that Mr. Durban is known for is being a “deal junkie”. He invested in companies, such as Zynga, Groupon, and Skype and all have turned out successful. Mr. Durban urges all investors to make calculated financial decisions rather than emotional ones. The approach is Alcatel-Lucent taking to stabilizing the organization is by pursuing a plan called, “Project Secular”, which allows the company to buy time by mortgaging key assets. This plan raised the...
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