cmt3324 strategic information system use of information … · in aligning its overall business...

THE USE OF IT/IS IN BRAND MANAGEMENT

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CMT3324 – STRATEGIC INFORMATION SYSTEM

USE OF INFORMATION TECHNOLOGY AND INFORMATION

SYSTEM IN BRAND MANAGEMENT

A case study of Coca-Cola


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CONTENTS

1. Abstract ............................................................................................................................... 4

2. Introduction ........................................................................................................................ 5

3. Rationale ............................................................................................................................. 6

4. Company Profile ................................................................................................................. 7

5. Organizational structure ................................................................................................... 10

6. Information System .......................................................................................................... 12

6.1. Information gathering ................................................................................................ 12

6.1.1. Ways of gathering information .......................................................................... 13

6.2. Information distribution process ............................................................................ 18

6.2.1. Model of distribution ......................................................................................... 20

6.3. Evaluation of information ......................................................................................... 23

7. Information Technology and Branding ............................................................................ 25

7.1. Use of information technology in branding .............................................................. 25

7.2. Use of information technology in information processing ........................................ 28

8. The role of strategic manager in brand management ....................................................... 31

9. Strategic framework in brand management and IT .......................................................... 32

10. Tools used in achieving competitive advantage ........................................................... 36


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11. The Brand...................................................................................................................... 40

11.1. Overview of brand management ............................................................................ 40

11.2. Coca-Cola Brand Management ............................................................................. 40

11.2.1. Brand Identity .................................................................................................... 41

11.2.2. Brand Equity ...................................................................................................... 41

11.2.3. Brand positioning ............................................................................................... 42

11.2.4. Brand Loyalty .................................................................................................... 43

11.2.5. Power of Branding ............................................................................................. 44

11.2.6. Coca-Cola brand strategy ................................................................................... 46

12. Recommendations ......................................................................................................... 48

13. Conclusion .................................................................................................................... 49

14. Reference ...................................................................................................................... 50

15. Appendix ....................................................................................................................... 54


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1. ABSTRACT

“We got it all right because we put it in a bottle”. This still would not have been an easy

statement by Coca-Cola. But “We got it right because we created it with you”, will be easier.

This report aims at how, where and what Coca-Cola has done right and wrong strategically,

in aligning its overall business objective with its strategic brand management.

In this write up, our attention is focused on how information system has evolved to aid brand

management, what strategic framework has been used to support branding and where tools

and techniques have been utilized to gain competitive advantage.


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2. INTRODUCTION

The Coca-Cola Company is a beverage company based in Atlanta, U.S.A. It manufactures,

distributes and market non-alcoholic beverages, concentrates and syrups. The company was

founded in 1886 and its best known for its flagship products: Coca-Cola.

In this report, we have researched and detailed the use of information technology and

information system in branding. We have also taken a critical look at what branding is and

the effort Coca-Cola is making in using information technology to build an even bigger

brand.

We also gave an overview of Coca-Cola’s brand strategy and the way the organisation is

using IT/IS in managing their brands and achieving consistent growth. Furthermore, we will

explore other applications of information technology within Coca-Cola including distribution,

logistics, ecommerce and information gathering.

Finally, we hope this report serves as an information base on how the Coca-Cola branding

system works in collaboration with IT/IS and how it can be improved using the technology

that exists today.


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3. RATIONALE

Coca-Cola has been listed as the number one brand in the beverage industry over the past

decades (Business Insider, 2013). The company has been and is still doing well in terms of

strategic positioning, in order to maintain their position in the industry. As a very big

company, they have well-coordinated strategies in which they always work on, to make sure

that their customers are satisfied.

The research conducted for this report was taken from the global perspective of the company.

Several reports, books and articles written on the Coca-Cola Company were reviewed to

make this report.

The Coca-Cola Company has penetrated every part of the globe. As such, there is need for

them to make sure that they maintain their number one position in terms of customer

satisfaction and preference. The Coca-Cola’s brand identity is one of their most important

assets. If there is any major negative change in customer perception to the brand, the

company risks losing its position to competitors like Pepsi.

Information system/Information Technology has a lot of impact on businesses nowadays.

Due to the strong advancement in the IT/IS sector, companies now have to make ensure they

have the best software and up-to-date solutions in order to compete effectively. The report

focuses on how IT/IS helps the Coca-Cola company position itself as the number one brand

in the world. It elaborates on the proper use of information system components by the Coca-

Cola Company to support its business.

Lack of adequate information can lead to the failure of any organization. This report widens

its spotlight on how the Coca-Cola Company generates information within and outside the

company in order to sustain its market leadership. It also elaborates on how the information is

being distributed through the right channels to the strategic managers.

Furthermore, IT/IS and Information, requires a strong strategic plan to succeed. The Coca-

Cola Company has a strong team of strategic managers that constantly requires access to the

right information. These strategic managers are supported by other management levels with

information they need require to create strategic management and leadership.


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4. COMPANY PROFILE

Established in the year 1886, the Coca-Cola Company operates in over 200 countries

worldwide and markets more than 3,500 beverage products. (Coca-Cola, 2012)

These products include both sparkling and still beverages, such as: Waters, juices and juice

drinks, teas, coffees, sport drinks and energy drinks. Coca-Cola controls four of the world’s

top five non-alcoholic beverage brands. These include Coca-Cola, Diet Coke, Sprite and

Fanta.

Figure 1 - Coca-Cola Product Line

The scope of the Coca-Cola Company’s covers most countries in the world and it is spread

across all geographical area including North America, South America, Europe, Pacific and

Africa. These operations include corporate offices and bottling plants (Coca-Cola, 2012).

Coca-Cola has also been involved in rapid expansion by acquiring beverage companies in

across the globe. In the month of December 2011, it acquired Great Plains Coca-Cola

Bottling Company (Great Plains) and Honest Tea in the United States (Coca-Cola, 2012). In

Japan, Coca-Cola acquired an additional minority interest in Coca-Cola Central Japan

Company (Central Japan). In September 2012, it also acquired approximately 50% stake in

Aujan Industries’ beverage business. (Coca-Cola, 2012)

MISSION

To refresh the world in body, mind and spirit

To inspire moments of optimism through our brands and actions

To create value and make a difference everywhere we go (Coca-Cola, 2012)

The Coca Cola Company Global Workforce is about 90,500


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Figure 2 - Coca-Cola Global Workforce Distribution

Geographical Area Main Staff Bottling Investments

North America 12,500 1,300

Latin America 3,300 10,400

European Union 2,500 14,200

Africa 1,300 10,600

Pacific 2,900 21,500

Eurasia 900 9,100

Table 1- Coca-Cola Global Workforce Distribution

THE COCA-COLA SYSTEM

These Coca-Cola systems consist of the company and more than 300 bottling partners

worldwide. Coca-Cola primary function is to manufacture and sell concentrates as well as

beverage base syrups to bottling companies around the world. The bottling companies will

then use the concentrates to produce a wide array of Coca-Cola beverages (Coca-Cola, 2012).


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In all the countries that it operates, Coca-Cola is responsible for all consumers marketing and

branding activities since it owns the brand.

Furthermore, the bottling companies in addition to manufacturing the final branded beverages

are also responsible for merchandising and distribution .They work closely with retail stores,

restaurants, cafes, street vendors, movie theatres, and parks and so on (Coca-Cola, 2012). All

these collaboration helps in bringing Coca-Cola daily beverages consumption to about 1.5

billion servings. (Coca-Cola, 2012)

Coca-Cola Enterprises Inc. (CCE)

CCE is the world’s largest marketer, producer and distributor of Coca-Cola beverages. CCE

operates in over 36 states in the US and Canada, and is the exclusive bottler of Coca-Cola in

six European countries. (Coca-Cola, 2012)

Coca-Cola FEMSA

Coca-Cola FEMSA is the third-largest bottler in the world; they operate in Mexico, as well as

in eight countries in Central America and South America. (Coca-Cola, 2012)

Coca-Cola Hellenic Bottling Company S.A

The fourth largest bottlers of Coca-Cola beverages, operates in 27 countries in Europe and in

Nigeria- with a total population of more than 550 million. (Coca-Cola, 2012)

Coca-Cola Amatil Limited

This is the largest independent Coca-Cola bottler in the pacific region and one is also one of

the world’s top six Coca-Cola bottlers. (Coca-Cola, 2012)


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5. ORGANIZATIONAL STRUCTURE

Organizational structure in a business or company consists of several functions. These

functions are human resources, operations, finance, and marketing. The global company of

Coca-Cola has a structure that accommodates many functions that form such a successful

organization. This structure is an international area structure that keeps their headquarters in

the United States (Bloomberg, 2010).

To sustain its market leadership it requires a solid organisational structure to keep itself

function at a superior level and to maintain its status as a top brand in the global market.

Coca-Cola functions in an organised format that allows for integration of all departments in

order to continually create successful products (Coca-Cola, 2012).

Varying Organizational Structures

The management structure that Coca-Cola uses is divisional because it structures, “…units

around products, consumers, or geographic regions” (Bateman & Snell, 2009, p. 303).

Coca-Cola worldwide operation is made up of six operating groups; these are Eurasia and

Africa, Europe, Latin America, North America, Pacific and Bottling Investment, and

Corporate. These operating groups consist of multiple divisions that have its own director

(The Coca-Cola Company, 2011). The divisional structure is different from other structures

such as functional and network structures.

A functional structure is different from Coca-Cola’s divisional structure in that a functional

structure is only two layers, containing one chief operating officer and multiple, lateral

departments designated by activities and duties (Bateman & Snell, 2009). This type of

structure would not work for a company as large and diverse as Coca-Cola. Coca-Cola needs

to have multiple levels that consolidate into each operating group in order to be effective.

The success of The Coca-Cola Company revolves around five main factors:

A unique and recognized brand - Coca-Cola is among the most recognized trademarks

and brands around the globe.

Quality – The Coca-Cola Company has been consistent, in offering consumers

products of the highest quality at various locations.

Marketing - Delivering creative and innovative marketing programs worldwide.

Example of this is Coca-Cola’s My Coke Reward program

Global availability - Coca-Cola products are bottled and distributed worldwide, even

to remote areas of different regions and countries


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Constant innovation – Providing consumers continually with innovative products at

affordable prices as offerings e.g. Diet Coke (1982), Coca-Cola Vanilla (2002).

(Coca-Cola, 2012)

Although Coca-Cola is a global product with universal appeal, the Company actually

operates in local environments around the world, with each country having its own unique

needs and requirements and that makes Coca-Cola marketing service unique for having to

distribute products to remote areas which are mostly heard of with greater ease.

While Coca-Cola is probably the only product in the world that is universally relevant in

every corner of the globe, the Company feels that its responsibility is to ensure that with

every single can or bottle of Coca-Cola sold and enjoyed, individual connections are made

with their consumer. That can only be achieved at a local level.

The challenge facing The Coca-Cola Company today is therefore to continue to build a

perfect organizational structure that will deliver a global and local strategy, but with a fast

growing brand like Coca-Cola, creating an organizational structure that suits both the

company and consumers is what the company is here to deliver.


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6. INFORMATION SYSTEM

Information system is a necessity for every organization nowadays. Due to the size of Coca-

Cola and the complex nature of its business it is very important for it to create a sufficient

information system to supports its production and operation. The Coca-Cola Company uses a

sophisticated combination of hardware, software and technical know-how and in order to

keep up production and serve its ever growing consumer base.

The Coca-Cola Company has several partners worldwide, mostly controlled by different

bottling companies. These bottling companies however, are constantly working towards

lining their business goals to that of the entire organization in whole. As such, most bottling

companies under the Coca-Cola company use Microsoft’s Enterprise Project Management

software (Orgel, 2002) and Servigistics’s Marketing Information System which are specially

designed for consumer and industrial product manufacturers (Marketing and

Communications Integration, 2009). Also, they constantly consult these companies in order

to make sure that their staffs have the best knowledge of these business support software.

In this way, the Coca-Cola Company always make sure that they have the best in terms of

information system in order to help them position themselves on ahead of their competitors.

6.1. INFORMATION GATHERING

The Coca-Cola Company, like any other big firm, gathers information in order to study the

business environment and come up with ways to improve on its brand. The process of

information gathering is not an easy task. Information gathered has to be accurate and

relevant to the field it’s been applied to. If there are mistakes, omission and or inconsistencies

in the information gathered, there tend to be a problem in decision making, which leads to

bumps in business growth. These have been a case in the early 1980's when the Coca-Cola

Company made a huge mistake of changing its whole formula and gave its product a whole

new name.

This shows how important it is to make sure that the information gathered is accurate to a

greater extent. In order to achieve all that, the Coca-Cola Company uses a number of ways to

collect information that helps it in making decisions. Even though the company has reached a

global level, it still has different information system in each and every branch across the

globe.

Some of the offices and partners use the Microsoft Office Enterprise Project Management to

collect relevant data and analyzes it to help in making decisions (Microsoft Case Studies,

2009). While other Bottlers use different types of Information system to automate their


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information gathering process. In the next section, we will discuss the major ways Coca-Cola

Company uses to collect data and processes it into meaningful information for decision

making.

Figure 3 - The Information System

6.1.1. WAYS OF GATHERING INFORMATION

Three ways of gathering information

Internal data

Marketing intelligence

Marketing research

Internal Data


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Use of retailers and the internet

Coca-Cola has always been the giant in beverage industry. The company gathers a

tremendous amount of data. This huge amount of data needs techniques and knowledge to be

converted into useful information. The Coca-Cola Company has different ways of gathering

information. Also, they have different ways of processing this data into useful information in

order to help the company make more profit. In this section, we will discuss how Coca-Cola

gathers information and use it help their company stay on top in the beverage business.

The Coca-Cola Company partners with retail stores, shopping malls and eateries in order to

gather information about the purchasing patterns of customers [Orgel, 2012]. All these

channels helps Coca-Cola gather useful data about their customers and it also helps the

partners to understand their customers well and increase their profit. Information is gathered

through various means, some of this includes checkout scanners, frequent buyer programs

and observations made by the staff of the partner store. The result of all these partnership and

information helps Coca-Cola to better understand their customers and the market they operate

in. This makes it easier for Coca-Cola to promote its products.

The type of information gathered varies across different stores. As mentioned above,

information gathered by scanners in the checkout counter produces a universal code and other

properties like price, time, location, quantity and so on. Transaction to specific households

and monitoring purchase pattern is being done with the help of frequent shopper programs.

Observations usually result in providing information such as; how the customer gets to

choose the product? Did they ask for any other thing before taking the product? Did they

browse through before other products before deciding on the product? Did they go straight to

it? When do coke products sell high? Where do coke products sell high when placed in front

or at the back of store? Which product sells better when placed with coke product? etc.

Information gathered from these varying sources is collated, formatted and processed using

proprietary analysis software from Coca-Cola. This software then processes all the

information to generate important data. This data are critical for Coca-Cola marketing and

growth efforts. Although the application was mainly developed to be used by retailers, it has

assisted Coca-Cola in enhancing its own operations and business (Orgel, 2012).

Coca-Cola is also constantly interacting and monitoring their activities on various social

networking sites. Social media has become a major source of information and customer

interaction for Coca-Cola (Lardi, 2012). Fans on Facebook are constantly posting comments

on the site and Coca-Cola has being able to use Facebook and other social media sites to

gather a huge amount of information about their customer (Lardi, 2012). Information

gathered from these networks is then processed into knowledge through several software

applications and this helps Coca-Cola in making strategic decisions.


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The processed and analyzed information is used by Coca-Cola to market its products to its

target consumer. The company use this information to determine product placement in store,

target markets and optimal price products. Coca-Cola can continually make calculated

strategic decision based on the data gotten.

Marketing Research

In this type of Information gathering, the Coca-Cola Company conducts a series of activities

through the following five phases:

Category segmentation

Market research

Product development

Develop range

Launch evaluation

Category Segmentation

Category segmentation involves the identifying of different set of consumers and formulating

the best way to meet their specific needs. Segmentation is achieved through the conduct of

various tests and demographic analysis of consumers across several locations. For example, a

research conducted by the Coca-Cola Great Britain (The Times 100, 2004) showed that in

bars, restaurants and parties, the best target products are the original Coca-Cola bottle, while

the appropriate size for a standard household is the 1.25L share size. Through these test and

analysis, it becomes easy to see that through appropriate information gathering, Coca-Cola

Company can better understand their customer and server them better.

Market Research

Market research involves the process of gathering, storing and analyzing market data in an

organised way (The Times 100, 2004). There are two ways in which market research is

carried out; these are primary and secondary ways. The primary way is made up of

information gathered in the fields through house-to-house or street surveys. Secondary way,

on the other hand comprises of the usage of pre-existing information source such as article,

journals, reports and so on (The Times 100, 2004).

There are two approaches to the primary way of market research, these are; Qualitative and

Quantitative.


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Qualitative research: Information from this research method involves collection of data

from a large amount of people by conducting all-encompassing surveys (Cheverton, 2004).

This helps Coca-Cola in the creation of new product or the expansion of existing ones.

Quantitative research: This research method with a small set of consumers. For example a

taste test research could be carried out to determine the consumer’s preference in terms of

taste. This is used to get specific information and insight about the test and a greater insight

on why people think what they think (Cheverton, 2004). Result from this kind of research can

help Coca-Cola in developing the right marketing campaign for its products.

Product Development

In this phase, the Coca-Cola Company makes use of Ansoff’s Matrix in order to examine

their products’ range (The Times 100, 2004). This helps them compare alternatives of

developing new products and new markets.

Ansoff’s Matrix is a product/market expansion grid is a framework for identifying growth

within an organization. (Dransfield, 2004)

According to Dransfield (2004), this phase gives them four main options at the end:

3. Market Penetration: This refers to selling of more of the same product to the same

group of consumers. Example of this includes the continued increase in Diet Coke sales.

4. Product development: This deals with the building of existing relationships with

consumers and the ability to develop new products suited to consumer needs. Example of

this is the development of the Fanta Icy Lemon flavour, which was developed based on

feedback from consumers.

5. Market development: Developing existing products for emerging markets. Example of

this is the marketing of Coca-Cola’s Burn energy drink in Africa.

6. Diversification: Developing new products for new markets. Examples include the

Toddler’s Juice called Winnie the Poo Roo Juice and Powerade.

Existing Product New Product

Existing Market Market Penetration:

Diet Coke

Product Development:

Coca-Cola Vanilla

Fanta Icy Lemon

New Market Market Development:

Coca-Cola Share size 2 litre

Bottle

Diversification:

Winnie the Poo Roo Juice

Powerade


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Table 2 – Ansoff’s Matrix with Coca-Cola

Developing Range

The Coca-Cola Company uses this way to develop the range of their existing or new products

in order to diversify its availability globally or to some parts that it needs. For example, when

a new product is being developed in the United States and it receives high demand from

customers, the Coca-Cola Company will then use a pilot way of deployment to test it in other

parts of the globe to see how acceptable it can be (The Times 100, 2004). If there is a

recorded success, the product range development is said to be successful. This has happened

when the Coca-Cola Company decided to introduce a new flavour in the United States after

several decades. They launched the Coca-Cola vanilla and they recorded success in the

United States, this made the company to tastes its potential in the Great Britain (The Times

100, 2004).

Launch Evaluation

This refers to evaluation techniques the Coca-Cola company uses whenever they introduce a

new product in the market. The main purpose is to evaluate its success in order to help them

in the near or far future. The company looks specifically at the various elements of the

launching activity which includes; distribution, advertising, packaging and product taste. The

data is collected through Marketing research organizations, company’s care-line, various

bottlers and consumer tracker report that measure consumers’ awareness of the brand (The

Times 100, 2004).

Marketing Intelligence

This is an extensive marketing research conducted by the Coca-Cola Company in order to

come up with ways to retain their market value and position as the best in the beverage

industry. This method deals mainly with external factors, all information gathered are from

external sources. It mainly deals with the business environment. Example of this is the Coca-

Cola blunder in the 1980’s where the company came up with a totally new formula for its

product to replace the old ones. This resulted in Pepsi taking their market position and setting

pace ahead of them in terms of sales and consumer preference (Snopes, 1985).


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Figure 4 - 'New Coke' and Coca-Cola Classic

The Coca-Cola Company invested billions of dollars and came up with a new formula called

‘The New Coke’. They conducted a ‘taste test’ for 200,000 consumers and to their surprise;

the new coke was the most preferred Leaf S. (2004). This made the company satisfied that the

new coke will be the game changer and so, they started selling it as their core product

replacing the old one. Soon the company started recording decline in sales and people were

already revolting on the product (new coke). After conducting several meetings, they had to

make decision of bringing back the old formula and renamed the product to classic coke.

They continued selling it side by side with the new coke. But after a while, the new coke has

to be removed off the shelf because of its unpopularity among the customers.

The problem with Coca-Cola at that moment was that there marketing research was not

extensive. The taste tests they made, thinking it can cater for the whole population was one of

the biggest mistakes they made. In a taste test, usually participants will prepare the tastiest

drink in a few sips. But it is a different case when it comes to finishing a whole can or bottle.

Another problem was that they did not pilot the new coke in places where they were losing

market in order to see how it performs. Instead, they replaced the whole Coca-Cola product

with the new one from every angle at the same time.

6.2. INFORMATION DISTRIBUTION PROCESS

The Coca-Cola Company understand the fact that they need to be ready to meet the demand

of their dynamic and evolving customers. This is the major reason why Coca-Cola in the


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nineties began to push for the decentralization of their organizational structures and the effort

continues even till date.

There are two main operating groups in Coca-Cola these are Corporate and Bottling

Investments. The operating groups are divided based on geographical region such as: North

America, European Union, Euro Asia, Africa, Latin America and Pacific. These geographical

regions are further divided into sub regions thus allowing for better and faster decision

making at a local level (Aswathappa, 2010).

Some divisions within Coca-Cola such as human resources, finance, marketing, innovation,

strategy are planning are located centrally within the company’s corporate division. Some of

these divisions functions at lower level in different regions and sub regions, however most

critical decisions are at the top of the hierarchy. For instance, when Coca-Cola decided to

host the world cup in 2002, the decision was made at headquarters in Atlanta, but advertising

and creative decision could be made at the local division and tailored to individual market.

In 2004, in order to deal with an extremely low growth rate, the former CEO Neville Isdell

created a solution to the organization’s pressing information distribution challenge. First he

mandated regular face-to-face meeting at local divisions to ensure employees where kept

informed of things happening within the organization. Furthermore, the company’s intranet

was overhauled to facilitate real-time sharing of information.

The ability to share critical information in real-time is critical for effective decision making

and Coca-Cola is continually refining their information delivery process. To ensure that

employees follow the organizational process, a code of conduct guidebook was designed and

disciplinary actions were taken should any employee act inappropriately. As a result of these

changes, there has been a significant change in employee’s productivity and they feel a lot

more engaged. This has also led to an increase in growth rates and better return on

investments for shareholders.

The balance and flexibility of information distribution gives Coca-Cola constant and

predictable information flow within the organisation. Coca-Cola information structure is a

hybrid of traditional and organic models that allows for a responsive system. The use of an

intranet is an example of an organic structure while examples of traditional models include

the use of surveys and interview. Interviews and surveys allow for information flow from the

bottom up while the intranet allows for a lateral information distribution flow. For a hybrid

system to be successful, centralisation and high standardisation is critical.

This hybrid system is ideal for Coca-Cola; the flexibility allows the company to reach a huge

amount of independent market while maintaining an efficient production process. The


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centralisation of the system also allows for easier global coordination and overall alignment

of task and activities with organisation goals.

With the increase in information flow, strategic manager can now access information quickly

and more efficiently thereby contributing to Coca-Cola’s flexibility and responsiveness.

6.2.1. MODEL OF DISTRIBUTION

Manual Distribution Centres (MDC)

Coca-Cola has an innovative program in Africa called the Manual Distribution Centres

(MDC). The main aim of this model is to increase Coca-Cola’s business goals while

promoting its international development agenda.

This approach seeks to improve Coca-Cola's distribution model in remote urban and

suburban areas in Africa by using small businesses to manually deliver Coca-Cola products

to local and small-scale retailers. Manual Distribution Centres currently account for over 80

per cent of the company's sales in East Africa and it is also creating jobs and improving

small-business ownership opportunities for a growing amount of entrepreneurs and women.

From inception till date, 2500 MDCs employing 12,000 people has been created in Africa by

the Coca-Cola system and it has generated over USD $500 million in annual revenues (Berry,

2010).

Manual distribution centres are the most viable for reaching rural and remote areas with

Coca-Cola products all around the globe. These MDCs are independently owned businesses

that are link to their local bottler. The bottlers may provide technical support such as, sales

training and others form of general support to the MDCs. The MDCs own the bottles and

crates, there only advertise Coca Cola liquid and that goes to MDCs first time customers,

there have to buy their own bottles and crates as well.

Beyond coca Cola lorry reach, the product can as well transported by bicycle, image credit

there may be unknown owner, that is why it possible to find coca Cola product in the Country

where the company is not presence and the typical parts of the world. However, it is not all

these distributors that are major reasons for Coca Cola to go all that far but the taste of the

product (Berry, 2010).


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Figure 5 - Coca-Cola Distribution

Direct Distribution

In direct distribution, they supply their products in shops by using their own transports. They

have so many vehicles to supply their products in each Country all around the world in order

to reach out to their customers (Management Paradise, 2012).

Figure 6 - Coca-Cola Trucks for Distribution

Indirect Distribution

They have their whole distribution agencies to cover all area. Because it is very difficult for

Coca- Cola and it’s bottler’s to cover all area by their own so they have so many whole sale

distribution agencies to assure their customers for availability of coca cola products.

(Management Paradise, 2012). For providing and distributing their product in good manner

company has provided infrastructure for her customers these include: Freezers, display racks

and free empty bottles and shells for bottles (Berry, 2010).

Distribution channel of Coca Cola is a tool in which the product gets to the final consumers,

therefore to achieve this objective there should be a proper and planned research for data

collection and the platform for analysis in order to attain the objectives. Data collection may


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be carry out by observation, interviews and questionnaires, so as to give room for

recommendation and conclusion the research and finding strategy of Coca cola (Management

Paradise, 2012).

Inventory barcode software

Coca Cola uses "Barcode Software, Inc" inventory software as a source for asset and

inventory management system (Md, 2009). They are able to track each of their products and

vending machines through a tracking system which allows them to track product availability

across all the vending machines in the United State. The actual system itself is called "Track-

it", and it can access all the information on all vending machines from Coca Cola. Track-it is

made up of specialized software that pulls the information from Coke’s mainframe database

and transfers it to handheld terminals with built-in laser scanners. Printed barcode labels are

generated and placed on every machine, old and new. The bar code indicates the machine’s

special asset number, as assigned by Coke.

When it is time to perform a physical inventory, Track-it pulls information on existing

inventory from Coke’s mainframe using “queries” and “ODBC” drivers. This process

generates a record on each piece of machinery with all pertinent information.

Next, this information is transferred from the PC in its entirety to each handheld scanning

terminal using Track, its specialized software. Multiple terminals are used simultaneously to

scan the barcodes on each machine throughout Coke’s remanufacturing facilities. As each

vending machine’s barcode is scanned, the asset number is compared to each number on the

list that had been downloaded from Track It. A report listing those assets found and not found

is then displayed on the handheld terminal’s display. The new information is then transferred

from all of the portable terminals back to Track It, and the database on the PC is

automatically updated. Reconciliation inquiries and reports are now available at the click of a

mouse (Md, 2009).


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6.3. EVALUATION OF INFORMATION

Critical evaluation of information is very essential in any organization, if they must remain

active in the market. At Coca-Cola, there are two forms of information evaluation they are;

Internal and External Information Evaluation.

Internal Information Evaluation

Internal evaluation of information within Coca-Cola is majorly carried out with Information

System. The proper use of information system is critical to Coca-Cola to ensure that they

remain competitive and allow for efficient flow of information within the organization.

External Information Evaluation

One of the tools used to evaluate external information is PEST analysis. PEST is an acronym

for "Political, Economic, Social, and Technological analysis" and it is a framework that is

used to measure various macro-environmental factors in order to make important strategic

decisions. Coca-Cola uses PEST analysis to ensure consistency with the environments in

which they operate. Why PEST analysis is used for a number of reasons such as;

Good use of PEST Analysis helps you avoid taking action that is condemned to failure for

reasons beyond your control. Failure to keep being on top is not an option for Coca-Cola at

this point in time due to many major reasons such as Employee Factors, Brand Factors, and

Investor Factors among other factors.

PEST is useful when you start operating in a new country or region. Use of PEST Analysis

helps you break free of unconscious assumptions, and helps you quickly adapt to the realities

of the new environment. Coca-Cola’s main strategic pattern is to break into consumers heart

as being to produce there world famous drink locally. So, this being there main point of reach

requires that there use of PEST analysis is a must for them

The Coca-Cola brand is indeed a global brand but it must be relevant locally and to effective

carry out this clear task of keeping it relevant. It extends is its use to information system to

properly identify information needed for the continuous growth of the company.

The Company estimate the growth of its product from the time in which it utilizes

Information System such as Television, Magazines to properly understand exactly what type

of new consumers and which area this consumers being spots out from. They are able to

properly evaluate this information within time range and also via market analysis of how their

product consummation has increased or decreased during the time in which there advert


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campaign is rolled out. Coca-Cola uses quantitative research rather than qualitative research

in properly evaluation the information about the growth of its organization externally.

Type of Information System use in Evaluating Information within the Coca-Cola

Company

Coca-Cola uses several information systems to integrate both internal and external

management information across their entire organization (Wallace, 2001). Example of such

system is SAP R/3 ERP systems from IBM (IBM, 2012). The ERP system simplifies the flow

of information between all organization’s departments and manages the connections to

outside stakeholders. These solutions enables the organisation to process information faster

and thus aid better decision making whilst reducing the costs of operation. The ERP system

also allows for faster and easier access to sales data. It also reduces inventory levels through

improvements in production, scheduling and forecasting.


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7. INFORMATION TECHNOLOGY AND BRANDING

Information processing refers to the processes taken by a computer program and other digital

electronic equipment, to manipulate digitized information known as information technology

(IT). The process involves recording, analyzing, sorting, summarizing, calculating,

disseminating and storing data. Information processing systems comprise business software,

operating systems, computers, networks. Whenever data needs to be transferred or operated

upon in some way, this is referred to as information processing disseminate.

7.1. USE OF INFORMATION TECHNOLOGY IN BRANDING

Coca-Cola is constantly using IT to change, rebrand and advertise its products in order to

increase revenue and brand recognition.

With the advent of social media and mobile applications development, Coca-Cola has taken

the lead to constantly harness all emerging information technologies in order to continually

promote its brand.

While it's mainly thought of as a simple soft drink company, other businesses could take a

page from the Coca-Cola handbook when it comes to using technology for innovation. As a

company, Coca-Cola constantly changes, rebrands, advertises for and presents their products

in order to keep sales consistently high. Since the dawn of social networking, the green

movement and the ability to stay constant connected to the Internet, Coca-Cola has

continually harnessed new technology in a variety of ways to further the brand.

Websites

Coca-Cola website was launched in 1995 and it was the first online venture by the company.

Currently, the company official website (http://www.coca-colacompany.com/) attracts about

1.2 million unique visitors monthly (Nytimes, 2012). The site was redesign in 2012 and

restructured to be an online magazine that will provide information constant editorial style

content for consumers, stakeholders and investors (Nytimes, 2012).

Social Networking

Coca-Cola maintains a visible appearance on Facebook and other social networking sites

such as Twitter, LinkedIn and YouTube. With over 56 million fans as of 2012, Coca-Cola

harnesses the power of social networking to spread the word concerning new products, test

advertorial campaigns, invite users to play games and associate Coca-Cola products with

http://www.coca-colacompany.com/


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positive feelings. Using social networking technology enables a brand to stay young, fresh

and current.

Figure 7 - Coca-Cola Social Media Information

Figure 8 - Coca-Cola Fans on Facebook

Online Advertising

Coca-Cola has always been strong in what is known as above the line advertising, this

includes radio, TV and newspaper adverts. With the advent of the internet, there has been a

rise of online advertisement and Coca-Cola is constantly using this medium to reach out to its

consumer.

By utilizing the power of the internet, Coca-Cola can run directed and subtle advertisement to

its audience. For example, If a user is browsing or searching for an eatery online, adverts for

Coca-Cola can popup next to the result. Or Coca-Cola’s adverts can be displayed anytime

certain keywords are used in a search result or web page. Example of such keywords can

include happiness, refreshments and Coca-Cola uses subtle yet effective online advertising to

make you feel like you want its products.

Targeted advertisements on websites mean that Coca-Cola has greater control over who sees

their ads and when they see them. For instance, when you're perusing the online menu of a

local eatery, Coke ads may appear, making you associate that restaurant with a tall, icy glass.

Or, when you're researching local beaches, you may see an ad for Coca-Cola products,

thereby associating heat with the refreshment of Coke.


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Mobile Applications and Websites

Coca-Cola also makes use of mobile apps and website to reach out to consumers. An example

of such is a recent Apple iAd campaign that allows users to win prizes by playing a mobile

game. The mobile game was use to promote Coca-Cola’s 12.5 oz. bottles and it encourages

users to play and win Apple’s App Store credits.

Figure 9 - Coca-Cola Handheld Game

Freestyle Dispensers

In late 2010, Coca-Cola began installing beverage vending machines known as freestyle

dispenser. This dispenser allows a buyer to create their own beverage based on the

combination of over 125 drinks (Fast Company, 2009). It uses a small computer to mix the

drinks and provide information about the consumer’s choice. The data from this dispenser are

sent back to Coca-Cola for market research.


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Figure 10 - Coca-Cola Freestyle Dispenser

7.2. USE OF INFORMATION TECHNOLOGY IN INFORMATION

PROCESSING

Coca-Cola uses several forms of data from different sources; one of the major sources of

information used by Coca-Cola is demographic data. Demographic data contains information

such as name, gender, date of birth, postal address, telephone, mobile number and email

address. Some of the information is provided by customers when they access Coca-Cola’s

website, contact customer service or interact with other online or offline services that Coca-

Cola uses.

All these personally identifiable information collected by Coca-Cola are be used legally for

several purposes including processing your transaction, creating personalize information as

well as for analytical purposes including tracking which part of the company site that users

are interested in. The personally identifiable information can also be shared by Coca-Cola to

their subsidiaries, partners or affiliations (Khosrow-Pour, 2003). One of the main purposes

using this information is to create advertising/promotional materials from some of their

advertising and strategic partners. They also used this information to analyze product usage,

customer’s behavioural patterns in order to create better and more exciting product may also

be uses for business purposes such as analyzing and managing of their business.

There are several ways in which Coca-Cola Company sort out data from a several sources

and turn it into useful information by using data mining technology. This information is


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normally used to increase revenue and reduce operating cost in certain area. Data-mining

applications can identify and extract patterns from a given data set (Khosrow-Pour, 2003).

With respect to the information technology that is used for information processing, the Coca-

Cola Company makes use an automated wireless system to interact with its bottlers. The

largest bottler of Coca-Cola outside of the USA makes use of mobile data capture and

delivery equipment produced by Motorola Solutions and equipped 3,000 sales people with

custom wireless handheld devices (Khosrow-Pour, 2003).

These devices from Motorola Solutions have made it very easy for salespeople on the field to

wirelessly receive the list of which clients or customers to visit. Other important details can

also be shared; these include availability of customers and specific task to be accomplished at

the customer’s site. This improves efficiency because the sales officer can get information

has it is needed on the moved and activity report can also be done automatically. This also

reduces the dependences on paper and manual processing.

Coca-Cola makes use of Microsoft Online Services. This is a business-class communication

and collaboration software delivered on a subscription based system on a Software as a

Service (SaaS) Model (Microsoft, 2012) Software as a Service (SaaS) model makes it easy

for Coca-Cola to have access to the latest software upgrade and it can easily be upgraded and

expanded as demand increases.

The service also reduces the need to perform routine maintenance such as updates, patches

and installation by IT staff. The importance of this is that it allows IT staff to focus on

innovation and initiative that can improve the efficiency of their service and move the

business forward.

There is a database manager whose is responsible for the database. The responsibility of the

database manager includes provision of read/write access to users, report generation and

analyzing usage of data.


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Figure 11 - Coca-Cola Information System Architecture

The report generated from the application can be passed on to strategic, tactical or operational

manager through Performance Reporting Management system. There are two types of report,

these includes performance report and system configuration report.

Performance report is mostly used to track changes in numerical data over a period of time. A

system configuration report in contrast provides data that are specific to the state or

configuration of a server.

Coca-Cola also needs data warehouse to store data electronically. To achieve this Coca-Cola

uses Teradata enterprise data warehouse system. With this system, Coca-Cola is able to

increase its information processing power and allow for better and faster decision making

based on the actionable information.

Information technology (IT) solutions can be inefficient without the right hardware.

Microsoft relies heavily on IBM to provide hardware solutions to manage its extensive data

processing needs and also provide optimal collaborative tool across the various department in

Coca-Cola (IBM, 2012)


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8. THE ROLE OF STRATEGIC MANAGER IN BRAND MANAGEMENT

In a world with so many alternatives of products, market and industries it is important for a

need of a well-managed brand that can result into competitive advantage and tactical

direction. It is important to see the Strategic manager’s role from the angle of the effect the

brand will have on its customers, consumers or even suppliers. This can be classified more as

cause of brand strength, resulting in cases such as:

The customer would pay more, even if there are cheaper options in the market

The customer would wait longer just for the brand's own version of a particular product

The customer is willing to walk the extra mile to get a product of a particular brand

All the above and more are the causal factors of what a Strategic Manager is expected to bring

into actualisation with branding.

The Strategic Manager is expected to focus on several areas of the company that will aid brand

management such as marketing, operational activities among others.

Role of the Strategic Manager in Coca-Cola Branding

Coca-Cola is indeed one of the most recognized brands around the globe. Having

successfully been able to keep this brand and lovers of the brand to it, has been a very

fascinating piece of information that is insightful to know.

Part of the major key success of Coca-Cola’s success can be certainly attributed to its

branding tactics. Having been able to achieve impressive brand loyalty through re-invention

of its brand, brand enhancement and brand attribution consistency, Coca-Cola is without

doubt, the leading non-alcoholic beverage provider company around the world.

The Strategic manager at Coca-Cola is involved in several major decision making processes

that take place in aiding brand development, brand sustainability, brand growth and as a

result leading into a customer being able to perform one or more activities that the effect of

branding causes such as:

Paying more for a Coca-Cola product even when there are cheaper options in the

market

Going the extra mile to get a Coca-Cola product even in cases where it is barely

available

Waiting for longer time for Coca-Cola’s own version of a product to be released

before enjoying the benefit of the product


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The main roles therefore of a Strategic Manager in any organization or Coca-Cola are

carrying out the brand related strategies that will aid the organization in achieving its main

mission and vision.

9. STRATEGIC FRAMEWORK IN BRAND MANAGEMENT AND IT

In an October 2011 Harvard Business Review interview, Muhtar Kent current CEO of Coca-

Cola talked about what the Coca-Cola brand is about. He said Coca-Cola is much more than a

product, it is about universal refreshments and moments of happiness (Ignatius, 2011).

Coca-Cola’s Strategic goal for 2020 is to double the size of their business, develop new

products to meet the ever-changing consumer preference and to make a positive difference in

the communities and countries in which they operate. (Coca-Cola, 2012)

Coca-Cola needed to formulate a strategic framework to sustain their brand Equity in the long

term. Coca-Cola wants to maintain this culture and brand position has they set to achieve

their strategic goals for 2020. The focus of Coca-Cola’s brand over the next eight years will

involve the following:

Building Community Trust

Increasing consumer relevance

Increase customer preference

Effective cost leadership

Key enablers in achieving their strategic objective are the use of unparalleled talent and a

high performance mind-set among staff and stakeholders.


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Figure 12 - Showing Coca-Cola Strategic Framework

Community trust

To create sustainable growth and achieve the Vision for 2020, Coca-Cola needs to develop

and build a reputation as a trusted and dependable partner for positive change in all the

communities where they operate.

There is a growing need for companies to foster and champion a greener environment. It is

essential for Coca-Cola to work with communities to foster a better environment and create

better and improve living conditions.

The eventual aim is to build trust: in the brands and products that Coca-Cola offers. And also

create a more open and transparent future that the consumers can continually rely on.

Our aim is to work with communities to continue to build trust: trust in our brands and

products, trust in our actions as citizens and trust in the future. To do this we strive to be

open, transparent and collaborative in all our actions and communications.


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Consumer relevance

For a brand to be successful, it must put the consumer’s first. This is a task Coca-Cola has

continually worked on to achieve. Coca-Cola is continually anticipating and meeting

consumers’ ever-changing tastes and desires.

The key goal is to continuously create and execute a consumer-first strategy to boost

relevance and growth and also capture new and emerging markets.

Customer preference

There is a constant and rapid growth in the beverage retail industry. The growth is tending

towards a more organised and large-scale format. By putting the consumer preference into

consideration, Coca-Cola is able to create sustainable partnership and value for their business,

customers and stakeholders across all

The retail environment for beverages continues to transform rapidly, with the trend towards

organised, large-scale and discount retail formats expanding to more of our markets. Our

response has been to make ‘customer preference’ a core value of our business. This means

building true collaboration and partnerships that create sustainable value and profitable

growth for our business and our customers across all crucial channels.

By continually working with bottling plants, partners and retail channels, Coca-Cola has been

able to design an extensive set of customer centric initiatives and ensure

By finding new ways to win together in the marketplace, we aim to be the preferred supplier

to all of our customers. To achieve this, we have adopted a comprehensive set of initiatives

designed to build collaborative customer relationships and ensure superior product delivery.

Cost leadership

Effective cost management is very important aspect of Coca-Cola’s long-term strategy to

sustain their market leadership and foster growth within the industry. To create effective cost

leadership, Coca-Cola has been able to craft out a lean, effective and borderless organisation

that will be dynamic enough to take advantage of future growth opportunities with full

adeptness.

Cost leadership is achieved by optimisation of production, logistics and distribution

framework. This will help create a strong cash flow and increase market leadership in the

long term.


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10. TOOLS USED IN ACHIEVING COMPETITIVE ADVANTAGE

They key purpose for achieving competitive advantage is to maximize growth, profitability

and create value for shareholders. Some of the techniques used by Coca-Cola to achieve this

are:

Strategic Alliance

Due to the size of its operation, Coca-Cola is able to create strategic alliance with suppliers,

technology firms and retail outlets. This alliance makes production and marketing of the

product easier and more efficient. Example of such alliance is with McDonald, this ensures

that only Coca-Cola products are sold at McDonald’s 33,000 outlets worldwide

(Mcdonalds.ca, 2013). This partnership creates a steady stream of profit for both brands.

McDonald’s gets a huge discount on the products it sells and Coca-Cola is assured sales from

the millions of McDonald’s customers (The Economist, 1998).

Figure 13 - Coca-Cola and McDonald's Strategic Alliance

Channel Marketing


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Even with an extensive distribution power and bottlers around the world, Coca-Cola still

manages their marketing and sales strategy. One other major marketing channel is the Coke

Vending machines. These vending machines allows Coca-Cola to sell directly to consumers

and also experiments with distribution method and flavour. Example of this is the freestyle

dispensers that allow consumers to mix their own drinks (Cokesolutions.com, n.d.).

Strong Brand Presence

A strong brand presence is a one of Coca-Cola’s strongest edge. The brand name is what

keeps consumers aware and loyal to the product.

Collaborative Customer Relations

By allowing direct communication with consumers, Coca-Cola is able to ensure that it can act

on the direct feedback. One of the advantages of this is with the creation of new product or

feedback on existing product. One major example is a direct response by Coca-Cola on the

company’s main website.

Figure 14 - Direct Collaboration on Coca-Cola's corporate website

Multi-Segmentation


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Coca-Cola has about 500 brands and servicing about 3,500 products. All products are created

to attract a certain market segment and are created to appeal to a certain audience. Examples

of these products are Diet Coke which is directed at women and Cola-Zero which is directed

at the younger generation. All these products allow Coca-Cola to created products that will fit

the need of a specific audience without having to rely on profits from generic products alone.

Figure 15 - Fanta Flavours

Go to Market strategies

A case study reported by BTS shows Coca-Cola Company implements a new go-to-market

strategy called “Customer Excellence”. Coca-Cola Company successfully carries out this

strategy by shifting merchandisers to call centres. Various sales and performance tools were

created to support the new roles and existing roles that the strategy had caused.

They also make sure that they communicate to all there about 30,000 agents in the North

America for successful execution of this strategy this strategy is also extended to their agents

outside of the North America also, thereby spending so much resource on making sure that

competitive advantage is secured. (BTS)


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For organisations to grow, they most create strategies that ensure that they are maximizing

profits, minimizing losses and increasing operational efficiency. There are several factors that

allows for organisational growth and market leadership. These factors are called competitive

advantage and every organisation requires it to succeed in the marketplace.

Coca-Cola’s competitive advantage ensures that they would sustain their market leadership

and increase unit sales as well. Increasing market share is a top priority for Coca-Cola (Coca-

Cola, 2012), higher economies of scale is achieved. Greater market shares will reduce the

average production cost per unit and guarantee greater profit for the company. The reduced

cost of production could ensure lower and more competitive pricing to attract new customers

and as a result demand also increases.

Due to the Coca-Cola’s strong brand identity and recognition, the bargaining power of the

consumer is low. This is due to the customer’s loyalty to the brand and Coca-Cola’s

competitive pricing strategy ensures that the unit cost of the product remain affordable. The

distribution of the product also ensures that customers can get the product whenever they

need to without having to consider any other competing product.

Coca-Cola’s competitive advantage can also be attributed to innovation, relationship and

reputation

As a result of its brand name, any new product introduced by Coca-Cola will have a

considerable number of people who are ready to test it out. This creates a strong advantage

for Coca-Cola and it allows them to continually test new products in smaller market and then

replicate its success in the bigger market. Coca-Cola constantly uses these strategies to create

highly successful products and build a considerable market share before the competition can

respond with their own product.

People tend to build relationships with brands and loyal customers will guarantee sales of

products. Through the years, Coca-Cola has built generations of loyal customers and they

continually ensure and guarantee sales for Coca-Cola products. Coca-Cola understands the

importance of customer’s loyalty and created a way to reward

their loyal customers.

My Coke Reward is the marketing program created by Coca-

Cola in 2006 and it allows customers to earn virtual points by

entering codes found on some Coca-Cola’s product on their website or via text messages. The

customers can then win prizes based on the number of “points” that they have acquired

(MyCokeReward, n.d.).


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Coca-Cola is also investing a lot in its reputation management. The company wants to be

seen as an “environmentally friendly” brand and it is investing a

lot to ensure that they reduce their carbon footprint and also

introduce greener initiatives to ensure sustainability (Coca-Cola,

2012).

Every year Coca-Cola creates a sustainability report and they outline all the programs and

initiative they are involved in to create a better environment. This includes greener plant-

based packaging, energy efficiency and product safety (Coca-Cola, 2012).

A large amount of Coca-Cola’s plastic bottles are recycled every year and they are

continually creating more avenues to allow people recycle their bottles. The company is also

reducing CO2 emissions and waste by using methane processing. All this process saves about

U.S. $577,000 per year on waste disposals (Coke Recycling, 2012).

All these initiative helps portray the organisation has a brand that seeks to make the

environment better and are making constant effort in ensuring that they create healthier and

more bio-friendly products.

Tools used in achieving competitive advantage

11. THE BRAND

11.1. OVERVIEW OF BRAND MANAGEMENT

Most companies continually seek to improve the strength and visibility of their brands. But a

common mistake company’s make is to seek to improve their brands without having a brand

strategy.

It is very difficult or even impossible for a brand to succeed in the market without a proper

brand strategy. Brand strategy gives focus and direction to a brand and it allows the brand

and strategic managers gain traction and consistent brand activities (Temporal, 2010).

An effective strategy comes from deep consumer insights. And has proven by Coca-Cola,

with the effective utilisation of consumer insights and brand management, it becomes easier

for companies to achieve their strategic goals and dominate the industry in which they

operate in.

11.2. COCA-COLA BRAND MANAGEMENT

Figure 16 - My Coke Rewards Logo


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A brand is a name, term, signal, sign, symbol or design, or combination of them, intended to

identify the goods or services of one seller or group of sellers, and to differentiate them from

those of competitors - (American Marketing Association)

As one of the most valuable and most recognisable brand in the world, Coca-Cola has a

powerful brand to protect and preserve. Coca-Cola’s current brand equity is valued at more

than Seventy Billion Dollars ($70 Billion USD) (Bloomberg, 2012). The company is

constantly investing in its brand with marketing campaigns spread across all media type and

format.

11.2.1. BRAND IDENTITY

A company success rides a lot in their brand. A strong and consistent brand identity can make

a company a market leader. Brand Identity refers to the outward expression of a brand and it

include things like its name, logo, colour and other visual appearance. (Neumeier 2004, pp20)

There are few companies in the world in the last two hundred years that can boast the history

and heritage of Coca-Cola's brand. The patented Coca-Cola logo, name and the curve of their

bottles is the most recognised in the world.

Figure 17 - The Coca-Cola logo - Image Courtesy of the Coca-Cola Company

Such a powerful identity has been one of the key to Coca-Cola's success in the beverage

industry.

11.2.2. BRAND EQUITY

Brand Equity deals with the valuation of a company's brand. It is the cumulative of a

company's market share, recognition and consumer loyalty. The more valuable a company's

brand equity, the easier it is for the company to enjoy increased and favourable performance


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over the long run. According to (Aaker, 2010), there are four distinct categories for

measuring brand equity these are:

brand awareness

brand loyalty

perceived quality

brand associations

There are several ways of measuring brand equity; one of the most popular is from the

international organisation called Interbrand. Interbrand uses several indexes including sales,

year-on-year market growth and market share to determine the equity of brands. When a

company’s health of an organisation is been measured, brand equity could form part of the

evaluation criteria.

In the non-alcoholic beverage segment, Coca-Cola owns four of the top five brands: Coca-

Cola, Diet Coke, Fanta and Sprite. With a brand valuation of more than 70billion USD, It is

currently the most valuable brand in the world and it is trailed closely by Apple (Interbrand,

2012).

Figure 18 - Interbrand’s 2012 Top 10 Best Global Brands

(http://www.interbrand.com/en/news-room/press-releases/2012-10-02-7543da7.aspx)

11.2.3. BRAND POSITIONING

Coca-Cola seeks to reflect and position itself as an integrate part of its consumer's everyday

life. The relationship between Coca-Cola's and its consumer leads to a strong brand loyalty

and makes it easier for consumer to choose Coca-Cola over other brands.


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All Coca-Cola's advertisements and marketing operations seeks to communicate this

personality with a lot of its unique selling proposition. Below are the lists of Coca-Cola's pay-

off line in the last ten years:

2000 - Enjoy.

2001 - Life tastes good.

2003 - Real.

2005 - Make It Real.

2006 - The Coke Side of Life

2007 - Live on the Coke Side of Life

2008 - Love it light

2009 - Open Happiness

2010 - Twist the Cap to Refreshment

2011 - Life Begins Here

2012 - Enjoy Coca Cola

(Coca-Cola, 2012)

From the pay-off lines above, Coca-Cola wants to constantly associate its brands with

happiness, joy, fun and enjoyment.

11.2.4. BRAND LOYALTY

When a brand identity is effectively communicated and positioned well it becomes easy for

customers to create a bond with it and see the brand as part of who they are and they will

eventually become loyal to it (Ehrenberg, 1988).

Keeping consumers coming for more of your product is the central point of a brand's

marketing effort. In a recent 2012 ClickFox Brand Loyalty Survey, The food and beverages

industries was reported to have the most loyal consumer and Coca-Cola ranked the second

after Apple in brand consumer loyalty (ClickFox, 2012)


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Figure 19 - 2012 ClickFox Brand Loyalty Survey

11.2.5. POWER OF BRANDING

The beverage industry is a very competitive one and Coca-Cola’s success is based mostly on

its brand in a survey by Johnson (2008) Without the brand name 51% of participants

preferred Pepsi versus 44% for Coke. With the brand names 23% preferred Pepsi versus 65%

that preferred Coke.


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Figure 20 - Coca-Cola versus Pepsi Survey without brand name - (Johnson, 2008)

53%43%

4% Coke vs Pepsi without Brand Name

Pepsi

Coca-Cola

Can't Say


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Figure 22 - 2012 ClickFox Brand Loyalty Survey - (Johnson, 2008)

The report above proves to the power of the Coca-Cola brand and why it is crucial to the

company’s success.

11.2.6. COCA-COLA BRAND STRATEGY

23%

65%

12%

Coke vs Pepsi with Brand Name

Pepsi

Coca-Cola

Can't Say

Figure 21 - Coca-Cola versus Pepsi Survey with brand name - (Johnson, 2008)


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Brand strategy focuses at Coca-Cola is majorly on ‘Changing Market Strategies’, ‘Customer

Sophistication’ and ‘Brand redesigning every time’. Early in Coca-Cola strategy was focused

on making affordable brand or brand affordable, available and acceptable all for the goal of

making the brand easily recognizable and making customer’s happy in the process (Pomoni,

2010).

Another main strategy used by Coca-Cola in branding is in building a very good employee

relations, customer relation management and also in getting and retaining human capital

effort for longer periods which over the years have had a tremendous effect on Coca-Cola as

a brand in production of product and seeding it all around the places where it needs to be

reached.

Coca-Cola also places heavy importance on getting their product more into very local places

where no competition has reached, enabling them the opportunity of relating to new

customers and consumers that have not been tapped before, which does in return result into

bigger brand name, better sales outcome among others.

The stronger the brands image the more likely the brand loyalty. Coca-Cola has also recently

extended its marketing strategy from just selling to major resellers to fast food joints leading

into Strategic Alliances between Coca-Cola and top firms in the fast food business. Also, by

extending its reach in the sport arena, gaming industries among others just to guarantee them

a continuously respectable brand.

In conclusion, Coca-Cola brand is successful due to it utilizing every possible mix of

marketing strategy and even going the extra mile in relationship with its customers, human

resource among others.

According to (Coca-Cola, 2012) Coca Cola’s brand building strategies and development is

constantly reviewed to align with the ever changing mind-set of its consumers. Below is the

essence of Coca-Cola’s brand strategy:

BEFORE: 3As

o Affordability: Retail price of Coca-Cola should be low and affordable

o Availability: It should be available when consumers want it.

o Acceptability: Make consumer happy to buy and drink the product

NOW: 3Ps

o Price to Value: Consumers should be able to afford it and it should be at the best

value

o Preference: Consumer should like, prefer and be partial to Coca-Cola’s product

o Pervasive Penetration: It should be available everywhere and at anytime


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Creating Brand Appeal through advertising campaigns that represents Happiness, Family,

Culture, Sports and Music

Meet Consumers level of sophistication

Over 55 Million Facebook Fans versus 9 Million Pepsi (Coca-Cola, 2012)

12. RECOMMENDATIONS

The uses of information technology can never be over emphasised in this 21st century, as a

result of the changing nature of today’s technology.

Therefore, it will be a strategic alignment for any organization that wish to succeed in today’s

business world, to adapt the use of Information System to their system flow and to support

there already in place strategies.

For Coca-Cola to maintain their market leadership and effectively use information

technology to build their brands, we recommend the following:

Develop a Product Management System. This system will gather and sort feedback from

direct channels, retails stores, marketers and consumers to a central location. This will

provide a holistic data point for Coca-Cola to track sales and effectively respond to

market demands.

Coca-Cola requires more aggressive marketing strategies has this could help Coca-Cola

maintain market leadership them stands in the beverages industries.

Coca-Cola should create more strategic alliance with retail stores, fast-food chains,

cinemas and other consumer oriented companies. Creating this alliance will help Coca-

Cola lock in more clients and guarantee profits. These alliances will require less

consumer marketing effort from Coca-Cola and it will help undecided consumers choose

their brand over existing competition.

Radio-Frequency Identification (RFID) technology can also be implemented to assist in a

semi-automated system. This will allow large volume of goods to be tracked through

various warehouses and it will help automate inventory and logistics system. This

technology will increase efficiency of Coca-Cola’s distribution system and also

inefficiency that might occur has a result of human error.


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13. CONCLUSION

The use of information technology is changing the way every aspects of business is been

carried out and branding is not an exception. Information System and Technology is helping

thousands of companies create better strategic plan and become more competitive.

From this report it is clear that for a company survive in the 21st century, they need to be

proactive in their use of technology tools.


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15. APPENDIX

Figure 1 - Coca-Cola Product Line ............................................................................................ 7

Figure 2 - Coca-Cola Global Workforce Distribution ............................................................... 8

Figure 3 - The Information System .......................................................................................... 13

Figure 4 - 'New Coke' and Coca-Cola Classic ......................................................................... 18

Figure 5 - Coca-Cola Distribution ........................................................................................... 21

Figure 6 - Coca-Cola Trucks for Distribution.......................................................................... 21

Figure 7 - Coca-Cola Social Media Information ..................................................................... 26

Figure 8 - Coca-Cola Fans on Facebook .................................................................................. 26

Figure 9 - Coca-Cola Handheld Game ..................................................................................... 27

Figure 10 - Coca-Cola Freestyle Dispenser ............................................................................. 28

Figure 11 - Coca-Cola Information System Architecture ........................................................ 30

Figure 12 - Showing Coca-Cola Strategic Framework ............................................................ 33

Figure 13 - Coca-Cola and McDonald's Strategic Alliance ..................................................... 36

Figure 14 - Direct Collaboration on Coca-Cola's corporate website ....................................... 37

Figure 15 - Fanta Flavours ....................................................................................................... 38

Figure 16 - My Coke Rewards Logo ....................................................................................... 40

Figure 17 - The Coca-Cola logo - Image Courtesy of the Coca-Cola Company ..................... 41


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Figure 18 - Interbrand’s 2012 Top 10 Best Global Brands ..................................................... 42

Figure 19 - 2012 ClickFox Brand Loyalty Survey .................................................................. 44

Figure 20 - Coca-Cola versus Pepsi Survey without brand name - (Johnson, 2008) .............. 45

Figure 21 - Coca-Cola versus Pepsi Survey with brand name - (Johnson, 2008) ................... 46

Figure 22 - 2012 ClickFox Brand Loyalty Survey - (Johnson, 2008) ..................................... 46

cmt3324 strategic information system use of information … · in aligning its overall business...

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