The Coca-Cola Company: Maintaining Relevance and Competitive Benefit in Business despite Criticism and Competition

The Coca-Cola Company: Maintaining Relevance and Competitive Benefit in Business despite Criticism and Competition

The Coca-Cola Company began in Atlanta, Georgia and mainly deals in carbonated soft drinks, particularly, Coca-cola – simply referred to as Coke. The marketing approaches of the Coca-Cola Company made the company dominate the world soft-drink market in the course of the twentieth century. The name of the company emanated from its initial ingredients, the coca leaves, and kola nuts (Pendergrast, 2013). Currently, the Coca-Cola Company operates in more than 200 nations across the globe, with customers taking over one billion liters of the beverage every day. Anchored in the ranking of the most excellent international products, Coca-Cola is currently the third most cherished brand across the world (Archer, Hand, & Blair, 2013).
Coca-Cola has taken a leading position for a long period though Google and Apple have recently overtaken it (Handayati, Simatupang, & Sridharan, 2011). One reason for its reducing performance is the intensifying criticism and competition. For instance, the US first lady, Michelle Obama, has been campaigning in fight against obesity, persuading the American residents to take more water, which plays a crucial role in reducing the number of American consumers. Moreover, the former mayor of New York, Michael Bloomberg, attempted to outlaw the sales of the enormous-size sugar soft drinks (Stuckler, McKee, Ebrahim, & Basu, 2012). Furthermore, the Food and Drug Administration has sought the use of new food labels that could more outstandingly show the grams of the used sugar, encompassing the high-fructose corn syrup employed in the Coca-Cola brands.
With strong support from its stakeholders and implementation of successful strategies, Coca-Cola Company could ensure that its final value of the stock generates constant returns in both excellent and terrible times, create a broad customer base, achieve competitive benefit, and triumph over criticism and competition. The failure of the necessary support and policies has led to deterioration of sales in its major market in North America and poor sales performance around the world, in addition to the dissatisfaction of investors. Recently the shares of the company have decreased by almost 7%, which is disastrous for the company’s reputation (Sievenpiper et al., 2012). This has been caused by obesity and health concerns that are challenging and are becoming stronger (Kent & Ignatius, 2011).
The issues of criticism, competition, and deteriorating performance do not just affect the Coca-Cola Company but even largely some of its competitors such as Pepsi (Karnani, 2014). Nonetheless, the Coca-Cola Company is exceptionally susceptible since close to 60% of its income is generated from the sales of the carbonated soft drinks. Coke is the company’s mother brand, and since it has been greatly criticized, the entire company is affected and has to put efforts in ending erosion in the US to prevent it from cascading the world over. The executives of the company ought to come up with suitable ideas and seek advice from outstanding branding and marketing professionals for knowledge on the best means of solving the problems of the company (Cozma et al., 2012). The reality that the Coca-Cola Company could be losing its grip is astounding as the company has been performing excellently for more than 127 years, over and above surviving innumerable health-related furore, partly since its major products have both sugar and caffeine, which could make it addictive.
Some of the strategies that the company could embark on to salvage its reputation and performance encompass enhancing media expenses by about one billion dollars in support of its brands and introducing more healthy products (Ha et al., 2012). Every professional concurs that the Coca-Cola Company is at a critical juncture and that the leading soft drink companies, including Coca-Cola, are facing critical crises (Nair & Selover, 2012). It is evident that there is no simple resolution to the problem, and successful policies have to be implemented as the company is encountering deep-rooted difficulties that have been developing for more than a decade. What can Coca-Cola Company do to maintaining its relevance and competitive benefit in business despite criticism and competition?

Statement of the Problem
The Coca-Cola Company is amid the most excellent internationally and has for a long time taken the leading position of the global soft drink sector (Habib & Aslam, 2014). From the moment it became baffled by its recurrent market-share scuffle with Pepsi, Coca-Cola has been compelled to deal with diminishing consumption of carbonated soft drinks, forcing it to venture in the sale of juices, water, and sports drinks. Though it has made great strides in cultivating a benign picture, Coca-Cola has as well encountered global pressure battles on matters varying from labor performances in Colombia to the sale of water in India. In the US, Coca-Cola has experienced the challenges of racism, allegations that its marketing endeavors resulted in the national obesity challenges, and condemnation due to the environmental influence of its venture in the bottle water trade.

Theoretical Framework
After a consideration of the models of consumer buying patterns, this study established that the rationale behind the consumers buying a given product is entrenched in their minds. In this regard, the consumers cannot evidently tell what influences their choice of a given product over another similar one since the deliberation and the emotions that drive the purchases to happen in the unconscious mind devoid of one’s alertness. This could lead to a given age group or culture going for a given product. That is why, while the older generation prefers taking the carbonated drinks from the Coca-Cola Company, the youthful cohorts want more healthy products as they are more concerned with their well-being (Kapferer, 2012). The comprehensive model below demonstrates the connection between different models thus preferring the term buyer to the consumer.

Fig 1: Comprehensive model

This study utilizes the prescriptive models, specifically the theory of reasoned action. The analytical models offer a structure of the major components that discuss the behavior of consumers as they establish a scope of influencing aspects with respect to consumer decision making. Similarly, the prescriptive models provide a structure for the organization of the manner in which consumer behavior is structured. In this regard, they prove to be significant to researchers when it comes to the measurement of the stimuli that ought to be changed or emphasized to draw a given consumer reaction. In line with the perception of subjective norm, the theory of reasoned action demonstrates the power of other individuals (for instance, the youthful or older generations) in controlling the purchasing behavior. On this note, the theory acknowledges the inclination of consumers towards a given behavior and is moderated by the degree to which the customers are encouraged to adhere to such viewpoints.

Fig 2: Theory of Reasoned Action

Sub-research Questions
• How can the Coca-Cola Company maintain relevance in business?
• What should the company do to regain competitive benefit?
• How can the company successfully handle criticism and competition?

Literature Review
There has been a severe attack on soft drink companies such as Coca-Cola and its major competitor, Pepsi, in the course of the recent years (Aaker & Joachimsthaler, 2012). The majority of people across the globe are greatly worried of the effects of carbonate drinks on their health and the welfare of their children. Some government authorities in numerous countries have even increased the taxes on the soft drink companies as a means of discouraging people from using them, and this has negatively affected the profitability of the Coca-Cola Company in such countries. On this note, what are the companies supposed to do to cushion the impact of such endeavors? The companies have to create effective strategies that will help the consumers balance their activities, drinks, and food while offering healthy options. Going by the current happenings, it is evident that the impact of the rising criticism, inspection, and competition is to influence the soft drink companies’ image and reputation negatively, which would destroy their business.

Remaining Relevant in Business
Irrespective of the brands that the Coca-Cola Company sells and the manner in which it is perceived, it must keep on positioning the value to its consumers in an approach that they retain their loyalty. By their measures to counter criticism, Coca-Cola, Dr. Pepper, Pepsi, and other soft drink companies are not in any way showing that their products are less valuable. Instead, they are endeavoring to add value to it through devising the means of assisting the consumers ensure balance and health (Andini & Simatupang, 2014). In its part, Coca-Cola is demonstrating that in such a balancing action, they are caring for the health of the consumers. The company is expressing to its customers that it treasures them more than its profitability; this is a kind of conscious marketing.
Strangely, the approach of conscious marketing offers some consumers the capacity to purchase other products as it goes from a thing that can be viewed in a fairly depressing light and reshapes it. On this note, there is a high chance that the products of the Coca-Cola Company are encountering this form of criticism and scrutiny (Hofer, Cantor, & Dai, 2012). Therefore, it is not about discovering a means of response to negative pressure but the manner in which the company generates added value for the consumers and its marketing in an attempt to stay relevant in the industry. Added value at all times denotes the things that matter to the consumers. It is not what the company believes to be valuable but instead what the consumers consider to be precious. On this note, the company ought to take premeditated focused moment to mull over who its target is and their needs and requirements. Another worthy stride is the determination of the way the products assists the company to realize the needs of the clients or resolve their needs.
The moment the company gets successful responses to such inquiries, it should communicate its intended value efficiently through its choice of products (Tóthová et al., 2013). The company has to make sure that the consumers are aware of the value it has for them and how the different products meet their needs. The company has to make it clear that its objective is to offer the consumers value for their money. On this note, it is vital that its value proclamation seem sensible and is associated with the products in the market. That is, the company cannot just take hold of anything that appears like the modern inclination and integrate it in its offering; it has to relate. For the company to be notable in the competition, achieve competitive advantage, stay relevant in business, and generate a strong affiliation with its consumers, it has to look at its products from a developed perspective. Moreover, the company has to establish the manner in which it can create value for its products for the sake of its consumers and let them know about it. In this regard, the company will develop the form of loyalty and longevity it is seeking.
The reasons behind the progressive poor performance of the Coca-Cola Company are varied and intricate (Powell & Gard, 2014). For instance, the average loyal customer for the company’s soft drink is 56 years of age as they get a feeling that they are young when they consume the products. On the contrary, the young generation is increasingly shifting to energy drinks and do not like the highly carbonated drinks. The competition also plays a key role. For example, the soft drinks offered by the Coca-Cola Company are more carbonated when compared to those of Pepsi, and are nearly twofold as carbonated as energy drinks such as Red Bull, which is progressively attaining a greater market share, particularly amid the youthful cohorts.
The rising demand for dark chocolate and coffee products, particularly in Japan and the United Kingdom, has altered the flavor fondness away from the sweet and towards the bitter (Sen, Johnson, Bhattacharya, & Wang, 2015). Furthermore, the parents that were in earlier cohorts normally introducing their children to the products of Coca-Cola, characteristically when they were between six and eight years old, have been hesitating, mainly due to health concerns. Taking the first Coke was a landmark and was entrenched in the community. Although such childhood recollections linger for a lifetime, the generational hand over is going kaput, and parents are becoming comfortable about it. The company ought to embark on more fundamental strides by standing out to regain the trust of the consumers by making new products and ensuring that the consumers will happily purchase products that have nothing to do with causing obesity and other health concerns.
If the company chooses to defend its state of affairs and volume, it will not be guarding its customers and their needs and dreams (Kleiman, Ng, & Popkin, 2012). This emphasizes the need for new and healthy products. Engaging in internal politics will only seek to worsen the performance of the company. The company should make use of a team to assess the requirements of the consumers with the objective of developing new products that meet their needs. Moreover, Coca-Cola ought to diversify by competing in groups traditionally considered as niche. This could call for the company merging with others in the industry to leverage their relevance by making products that make people healthier.

Research Design
This study will undertake the primary way of data collection where the data will be garnered from the Coca-Cola bottling branch located in Elmsford, New-York City.The nature of the research design will be qualitative. In the research, the dependent variables will be customer loyalty, relevance in business, and competitive benefit whilst the independent variables will be criticism and competition, and the demographic variables will cover racial and cultural background, the level of earnings, family size, age, level of education, and sex. A survey will be carried out with the chosen participants (Raja & Kumar, 2014).

The population for the research will be the consumers of the Coca-Cola bottling branch located in Elmsford. An appeal for the selection of the sample to interview will be made to the managing director of the branch. The non-probability sampling strategy will be utilized in this research. The approach of getting the most relevant participants according to the demographic variables will be reached following a discussion with the executives of the branch after which they will then issue 36 (to 20 male and 16 female clients) requests to take part in the interview. The thirty-six requests will constitute the expected final sample for the interview. This is a well representative sample as it uses an appropriate number of both genders (Button et al., 2013).

Data Collection
After the interviewees confirm their participation, open-ended questions will be prepared (See Appendix 2). Before letting the interviewees respond to the questionnaire, the interviewer will shed light on what the process entails and emphasize on the confidentiality of the given information and the autonomy of participation. The participants will be notified of the utilization of a tape recorder to facilitate precision of the data and enhance the permanence of the record. The recorded data will be transcribed to certify the safekeeping of the information for future reference.

It is vital for Coca-Cola to put more efforts in the development of natural, low-calorie, and healthy products and advertisement of its new products. For the company to recover brand significance, it must satisfy the changing aims of the consumers. Innovation is one approach that could be successful and necessitates detailed knowledge of the preferences of the consumers and taking offense instead of defense regarding the highly carbonated drinks. The Coca-Cola Company has to employ innovation to regain a leading position and ensure that it maintains a modern view by offsetting health issued that have been articulated by both its customers and critics. In this manner, the company should seek products that are part of the resolution to obesity challenges by providing the customers a mix of natural zero-calorie and sugar sweeteners (White, Oliffe, & Bottorff, 2014).

Tasks and Sub-tasks
Activity Expected Durations
Year 2015 Year 2016

Proposal writing
Data gathering and
data analysis

Project report writing
Report submission

The researcher believes that the entire task has the following approximated durations:
Optimistic (a) = 10 weeks (2 ½ months)
Most likely (m) = 13 weeks (3 ¼ months)
Pessimistic (b) = 25 weeks (6 ¼ months)
On this note, the anticipated time (µ) is 15 weeks
Figure 3 below demonstrates the beta distribution of the above three-point approximated durations.
Figure 3: PERT chart

For this study, the standard deviation is 2.5 days

Anchored in the progression of tasks in Figure 1, the anticipated time is 15 weeks. The standard deviation is 2.5 days. Employing the confidence intervals, the researcher can establish that, at a 95% confidence level, the likely project period can be anticipated to be between 10 and 20 days.

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Appendix 1: Calculations for the Planning Chapter
Optimistic (a) = 10 weeks
Most likely (m) = 13 weeks
Pessimistic (b) = 25 weeks
On this note, the anticipated time (µ) is:
µ = a + 4m + b/ 6
µ = 10 + (4 x 13) + 25
µ = 14.5 weeks (rounded off to 15 weeks)
Since variance is a squared figure, it is hard to construe. To determine this complexity, it is easy to work with the square root of σ2, referred to as the standard deviation (σ). The standard deviation is 2.5 days (σ = the square root of 6.25).

σ2 = 6.25
The anticipated time is 15 weeks. The standard deviation is 2.5 days (σ2= 6.25). At a 95% confidence level, the likely project time is between 10 and 20 days [15 + (2 x 2.5)].

Appendix 2: Questionnaire
Interview Questions
Your contribution in this study is highly appreciated. All the information that you give as your response in this study will be treated with strict confidentiality. Kindly give your answers to the personal details and questions below in the attached blank sheet.
Personal Details
Age: Race: Income level:
Family size: Educational level: Gender:
1. How do can you describe your satisfaction with the products of the Coca-Cola Company?
2. What keeps you to keep buying its products?
3. For how long have you been buying the products of Coca-Cola and how frequently do you purchase them?
4. What changes would you advise the company to implement?
5. What should the company do to remain relevant in business?
6. How can the Coca-Cola Company regain its leading position in the market?
7. In what ways should the company address the issues of criticism?
8. Explain the strategies that could help the company keep doing better than its competitors.