The Environmental and SWOT Analysis

 

Dawn Lawrence

MKT 574

October 18, 2020

 

Environmental and SWOT Analysis

Company description

The coca-cola company is the largest company responsible for beverages. The company makes branded beverages available to the consumers globally; this is done successfully through the partners, distributors, wholesalers, and retailers. The company operates in various groups: Europe, North, and Latin America, as well as the Asia Pacific. The company’s mission is to refresh the world and develop values and make a change globally. The vision of the company is the specialization of the brands and preference of drinks that people cherish to freshen them in the body and spirit. This is done in various ways that make a business sustainable and better-shared future, bringing a difference in people’s lives, our planet, and communities. The company is made of seven types of drinks for the world, for instance, first energy drinks, sports drinks, and juices(Schweppes, 2014).

Environmental analysis

Coca-cola company is a company refreshing the world with its drinks should ensure that the surrounding is well maintained. The various mechanisms used in the production of the products should be well followed to minimize pollution to the environment. The environmental laws are adhered to in the manufacturing of the products, and if there is a shortage of some elements, it may affect distribution and production. The bottles should be well maintained for recycling to avoid the environmental effect. Besides, the company takes advantage of the humid conditions that would enjoy the company’s drinks in the process of cooling down.

Competitive forces

Coca-cola company is the primary producer of beverages, and it is known globally. The major competitor of coca-cola company is Pepsi. Various forces affect the company. The power of bargaining of the suppliers is weak; this is due to the rising number of suppliers, which can make the company difficult to switch to another supplier, which can be expensive. The company can face threats from the incoming industries. The new entrants will be challenging to face the well-established industries because they may require capital for recruiting well-trained employees. Also, customer loyalty is crucial for the company, which is also time-consuming. The bargaining power of the customers is too low. The products produced by Pepsi and coca-cola have some similar features.

In contrast, the two companies’ switching prices are not high; hence, the two brands enjoy loyalty. The threat from the substitutes is very high when comparing coca-cola and Pepsi. The high number of substitutes of products is high from the coca-cola company. There is also a competitive rivalry between Pepsi and coca-cola since they have similar products and strategies. There is no difference between products made from coca-cola and Pepsi; this makes the price competition high. The coca-cola company has come up with various products such as drinks with less sugar for those who have diabetes; this makes the company remain competitive.

Economic and Political forces

Coca-cola is the largest producer of beverages globally, where every customer can access the product. Political factors of the country can affect the production of the company’s products hence can affect profitability. For a company to succeed in a political country, it has to follow a given country’s rules and regulations, for instance, paying taxes. Also, the company should produce products that are best for human health. Besides, being the election year, many political strikes can affect the profitability of the company. COVID 19 has affected the economy of the country at large. For instance, high unemployment rates where most employees are used to provide labor for the production process have been minimized; this will affect the economic process. The high unemployment rate can lead to high prices in the production process; this can lead to high prices of goods, and later the company can receive less profit. Also, the pandemic has led to a reduction in incomes, later leading to a decrease in the country’s tax collection.

Legal, Regulatory, and Ethical Issues

The coca-cola company ensures that the legal regulations have adhered to it. The company ensures that various individuals are responsible for ensuring the company follows the regulations. The company ensures the code of ethics is followed by allowing supervisors to ensure the ethics and regulations are followed. Being the largest beverage company, it struggles with ethical issues, such as racial discrimination or terminating the distributors’ contracts. Ethics goes hand in hand with legal issues. If the company ensures that the company’s morals are adhered to, then the company is in a good position of avoiding legal issues. For instance, if the company ensures the surrounding is well maintained by reducing pollution, the company adheres to the government laws.

Technological forces

Coca-cola company has the main objective of ensuring customers can access the products globally. The company invests more in technology; for instance, the company manufactures various shapes and sizes of the bottles presented to various customers by using advanced technology. Besides, the company creates an online platform for selling the goods where every customer can access the products globally. Transportation of coca-cola products has been promoted by using the new technology whereby various taxis are used to transport goods from one point to another; this has made the distribution of coca-cola products efficient.

Social forces

Society’s norms and the methods of carrying out their activities can affect a company’s culture in the surrounding. The community’s beliefs and attitudes will demonstrate how the marketers of the company will understand the customers in a particular market and the process they will create marketing messages for beverages. For instance, in the Muslim community, during the Ramadhan period for a month, most Muslims are advised to take only water in that period. Therefore, the company cannot carry out promotional campaigns in this period, which will be against the Muslims; this can affect the brand of the company.

Current Target Market and Marketing

The company faces various challenges in terms of promotion. Most adverts are targeted at youth and healthy consumers. The company’s demographics show that under the age of 24 years consumers are more followed by those above the age of 65years; in line with this, more consumers prefer Sprite, followed by Fanta. The drinks of the company are mostly preferred in the afternoon hours. Besides, most coca-cola shoppers prefer doing their shopping in dollars than clubs, and the purchase of the products is above 21 items.  The company’s marketing plans are based on the 4P’s. In product strategy, the company produces various types of drinks globally, including Sprite, Coca Cola, and many others. The uniqueness of the bottle, logo pricing mechanisms helps in marketing. The company can also advertise products on social media platforms such as Facebook and Twitter to reach more customers. The company is also regarded as one of the best sponsors, for instance, sponsoring Olympic games.

SWOT Analysis

Strengths

  • Has the highest brand equity
  • It is available globally
  • There is customer loyalty
  • Has a wide range of products
  • Has the most significant distribution channels
  • Supreme in terms of market share
  • Stable financially

Weaknesses

  • Issues concerning water handling
  • Stiff competition with other companies such as Pepsi
  • Nonexistence of healthy beverages globally
  • The diversity of products is minimal

Opportunities

  • Product promotion of unknown products
  • Application of modernized technology
  • Develop supply chain strategies to minimize costs
  • Product diversification in new areas

Threats

  • Shortage of water supply
  • Indirect competitors
  • The economic and political fluctuation of a country

The organization should develop strategies to minimize competition with Pepsi, for instance, advance in technology; besides, this will develop mechanisms to increase water supply in the company. In this process, the company should enhance product diversification globally. Being financially stable should motivate the company to penetrate areas that do not have access to beverages; this will make the company known globally. Hence, the market share will be large(Hill, 1997).

Marketing objectives

The decisions made by every company are crucial in any business. The objectives of a company will lead the company in the right direction. The company’s main objective is to ensure the company is known globally in their business and perform their duties responsibly; this will enhance the development of the company that will operate in the future. When the company, coca-cola has this objective, it will make the decision process faster (Simmons, 2006).

 

 

References

Cola, C., & Schweppes, C. (2014). The Coca Cola Company. Human Rights Policy.

Hill, T., & Westbrook, R. (1997). SWOT analysis: it’s time for a product recall. Long-range planning, 30(1), 46-52.

Simmons, C. J., & Becker-Olsen, K. L. (2006). Achieving marketing objectives through social sponsorships. Journal of Marketing, 70(4), 154-169.

 


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