Coca-Cola

The Price Variable

Coca-Cola Amatil implement several pricing strategies in attempt to attract its target market and convey certain messages about their products. In order to remain competitive within the market Coca-Cola Amatil tend to avoid using just one pricing strategy. As the majority of Coca-Cola sales come through retail outlets such as supermarkets, convenience stores, and fast-food restraunts, Coca-Cola Amatil doesn’t have entire control over the final consumer price, although there are certain pricing strategies implemented by Coca-Cola Amatil used to entice its target market. Discounting, price skimming and price lining are all pricing strategies commonly used in conjunction with their ‘headline’ beverage, Coca-Cola. Coca-Cola can be found in a number of bottled and canned forms, with fairly competitive prices that have now become an industry standard (see figure 1,2 and 3).

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An example of a pricing strategy used for the Coca-Cola product is price skimming. Price skimming involves charging the highest price possible for innovative products. Price skimming is usually used for a new product on the market. When competitors enter the market this strategy is usually dropped. Coca-Cola Amatil combine an approach of discounting certain lines each week (whether it be 375ml can, 600ml, 1.25L, or 3L bottles) with price skimming, particularly at convenience stores such as service stations. Coca-Cola products are never part of loss leader strategies, where a product is deliberately sold below its cost price to attract customers into the store. Eg: Fast food stores sell inexpensive burgers hoping that customers will buy other products. By charging a premium yet affordable price, this value is an attempt to reflect the quality of the Coca-Cola product. Because they are market leaders in several fields there is