Coca-Cola is a multinational company with many of its renowned brands it has been serving the world for a long period. Coca-cola is the largest non-alcoholic beverage company in the world serving its different type of brand for more than 100 past years. It has been serving more than 200 countries with 550 of its brands including orange juice, tea, carbonated drinks, and sports energy drink.
Coca-cola was founded by Dr Johns Pemberton in Atlanta, in the year 1886. He was also the inventor of that product. Also, Coca-cola operates franchises in which coca-cola sells the syrup and sold to the franchisees.
SWOT Analysis of Coca-Cola
This Analysis of Coca Cola will elaborate on the internal and external analysis of Coca-Cola.
Strengths of Coca-Cola
Strengths of Coca-Cola tells that what is brand is good at based on its strategies, market share, resources etc. These indicate the internal factors of a brand.
Brand Value
Coca-Cola has a strong brand positioning and a vast portion of market share. It has a profit margin of approximately 6-8 million dollars every year. Because of its worldwide recognition and brand equity, this brand is one of the leading companies like Google, Microsoft, and Facebook etc. around the world. From its logo to packaging, everything has a distinct identity. Its branding and marketing have made its logo and name recognizable to people from children to elders.
Loyal Customer Base
This brand has a huge loyal and stable consumer base around the world on the beverage industry. Many beverage brands have come and go, but there wasn’t a bit alteration of Coca-Cola’s consumer base; instead, it’s increasing day by day. People of every age groom generation to generation are fond of Coca-Cola’s drinks.
Global Presence
This brand, with its large and sophisticated distribution channel, operating itself among 200 countries worldwide. It’s serving approximately 1.9 billion people every day through the world. It has made itself always available on every market with its extensive supply chain management network. Every corner of the world, either privileged or underprivileged, is having the taste of Coca-Cola.
Branding & Promotion
The marketing campaigns of this brand is always unique and fresh than any other brands. Coca-Cola’s promotions are considered as the world’s best ones! People consider Coca-Cola as a storyteller with which they feel connected. With each promotional act, this brand reaches a milestone of popularity.
Large Product Portfolio
The broad product portfolio is one of its biggest strength. It has more than 500 product lines includes mineral water, energy drinks, soft drinks etc. It is also constantly working on new product development for different target market globally. And each of them is equally popular among people of every age.
Related Reading: SWOT Analysis of PepsiCo
Weaknesses of Coca-Cola
The weaknesses of Coca-Cola indicates the lacking it has inside the company, which is hindering its growth in the market.
Water Management
The production of this brand uses a tremendous amount of water without any proper management, which has led to mass criticism and legal consequences. People of many countries have also protested against it that has led to some unfavorable promotion in the market. Also, as water is a primary ingredient for Coca-Cola, it had to face many difficulties in production management and still facing it.
Health Issue
Nowadays, people are getting more health-conscious. As a result, they’re criticizing high sugar carbonated beverages which is affecting Coca-Cola a lot because its main product lines are dependent on those ingredients. And it is fount that those used ingredients are unhealthy and are one of the main reasons for causing obesity and diabetes. As a result, the sales margin is being affected.
Lack of Product Diversification
Though this brand has an extensive product portfolio, it lacks diversification. Coca-Cola is more concentrated on drinks, where it’s competitions like Pepsi is enjoying a massive reach by entering into snacks products. As a result, the competition is getting higher, Coca-Cola is losing its market share.
Related Reading:
Opportunities for Coca-Cola
Opportunities are the scope for Coca-Cola to spread its wings more and to get into a higher level. It can grab those chances and overcome the obstacles.
New & Healthy Products
Coca-Cola can enter into the snack industry with new and diversified products to capture a new market, instead of focusing only on drink related products, and increase its sales and profit margin. Also, it can start to produce healthier product lines with less sugar and calorie ingredients so that people don’t get the chance to boycott its drink for health reasons.
Entering into Developing Countries
Coca-Cola has a huge potential in developing countries because of its growing standard of living and environment. Although it are already available there but establishing production plants there will help to reduce the operating and promotional cost and capture the market on a broader level.
Partnership & Acquisition
Coca-Cola is already operating globally, but if it starts to do partnership and acquisition with other companies, it’ll get more advantages and efficiency in distribution, promotion and manufacturing. Such as, Starbucks and Nestle has built a partnership which led to more popularity, quality improvement and increase sales.
Promoting Less Popular Products
Coca-Cola has some product lines which didn’t get much popularity initially and now is wholly ignored. But this brand can introduce those products in a trendy way with new packaging and value propositions. Many brands are following this strategy and getting successful. And it won’t be difficult for a brand like Coca-Cola to retargeting its less popular products.
Threats for Coca-Cola
Threats are the factors which can affect Coca-Cola in the future. These things are not visible yet but can happen anytime soon, which can cause a crisis for a brand.
Higher Competition
Though Coca-Cola is one of the leading companies in beverage industries, the competition is getting higher and sometimes this brand it getting behind of others. Pepsi is getting string with its product diversification, the partnership of Nestle and Starbucks, etc. are giving Coca-Cola an alarming rise of competition that can cause it to lose its market share.
Government Regulations
Government regulations and taxation policies are getting highly imposed on Coca-Cola, both directly and indirectly. As this country is operating though more than 200 countries and each state differ in regulations, a sudden change can cause enormous harm to this company. Recently the UK has imposed new tax rule on sugar, and many countries are thinking to restrict water usage, and these are not a good sign for Coca-Cola.
Reduction in Demand for Carbonated Drinks
Now people are more health-conscious than ever. It won’t be surprising if people around the world start to reduce the consumption of carbonated drinks because of high sugar and calorie ingredients. As, Coca-Cola lacks product diversity and mainly dependent on its drinks related products, that potential change can devastate this brand.
Final Verdict
In this SWOT analysis of Coca-Cola, we have found a good number of strengths that helped the company to achieve great competitive advantages over its competitors. Besides, we have found several weaknesses as well. These can be improved by utilizing their strengths to improve its business.
Related Reading: How does PayPal Make Money?
“Fahmina has been actively contributing here with her writing skills. Fahmina has always had a way with her words, and now she is focused on channelling that knack for writing towards a more professional line of work. She is currently an undergrad, majoring in Marketing from the University of Dhaka. Her interests include writing engaging and insightful pieces related to Business Strategy Formulation, Business Analysis, Strategy Ideation, Market Analysis as well as Market Research.”