Having a presence in 200+ countries, coke has been the no.1 choice for millions of consumers all these years when it comes to choosing a carbonated soft drink. In case of Coca-Cola life, the brand has not been able to gain expected level of market share. Coca-Cola Marketing Mix The marketing mix of Coca cola has been changing over time with more and more products being added such that today it has 500+ products, and many different ways of advertising all those products. Products or business units of the company that are still in the nascent stage of their product lifecycle and can either become a revenue generator by taking the position of a Star or can become a loss-making machine for the company in the future. Moreover, the future outlook of these products is also bleak, necessitating the evaluation of the viability of continuing business operations in this domain. How Coca-Cola is fighting against a US public losing the taste for it. The company has been around for decades, and its products get consumed worldwide. [online] October 12 Available at: http://www.news.com.au/finance/business/other-industries/spork-life-dysfunction-at-the-heart-of-cocacola/news-story/e02d21493c23b58c4ff48bb96cbb3de7 [Accessed 12 September 2016]. Next is BCG matrix which has four quadrants: Star, Cash Cow, Question Mark and Dog. For carrying out industrial analysis, The Five Force Model presented by Michael Porter in 1979 is being used as the de facto framework since the time of its introduction. The BCG Growth-Share Matrix The BCG Growth-Share Matrix is a portfolio planning model developed by Bruce Henderson of the Boston Consulting Group in the early 1970's. The reason for this classification is that the mineral water industry is still viewed as a gradually evolving segment on an international scale. For the BCG (Learning Exercise 6C) Use the information in the Learning Exercise in your text to prepare a BCG matrix for the Coca-Cola Company locating each division where you believe it represents its position relative to market share and growth. BCG Matrix Example: BCG Matrix of Coca Cola. Ife and Efe Matrix Sm. Diet Coke. Founded in 1892, the company is headquartered in Atlanta, Georgia overseeing a franchised business model where it makes the famed Coca Cola syrup concentrate which it then sells … They are the star products or businesses of the company. Learn the BCG Matrix of Samsung and understand different business units which fall under different quadrants. These products have the potential of being positioned as cash cows in the future owing to the industry growth prospects. Coca-Cola is a multinational company that has been operating for over a century. I. But because of this Coca cola is … The Coca-Cola Company is the manufacturer of a variety of non-alcoholic beverages. Another issue that raises question about the feasibility of these business units or products for the company is that they do not offer significant revenues to the organization. Coca-Cola as a beverage has been operating as a cash cow for the Coca-Cola Company, as the brand is sold across 200 countries in a mature beverage industry. An industry example of a ‘Cash Cow’ product would be the original Coca-Cola … Its Cola is popular worldwide & is liked by people … Worlds leading ready-to-drink beverage company, Coca Cola company has more than 500 soft drink brands, from Fuse Tea to Oasis to Lilt to Poweradeorlds, but none of them is anywhere close to coke brand in awareness, revenue, and profit. These two dimensions reveal likely profitability of the business portfolio in terms of cash needed to support that unit and ca… It is a growth share 2×2 matrix. Available at: https://www.theguardian.com/news/datablog/2015/feb/13/coca-cola-us-public-losing-taste [Accessed 12 September 2016]. Coca-Cola Company is the worlds largest selling soft drink. SWOT ANALYSIS AND BCG MATRIX 2 Introduction The Coca-Cola Company is a beverage corporation with its main headquarters in Atlanta, Georgia. Both of these business units are stars for the Coca-Cola Company as the rising need of bottled water opens up growth opportunities in the industry (Estrel, 2015). Save my name, email, and website in this browser for the next time I comment. Nevertheless, an important consideration for the management is to ensure that the bottled water brands remain a source of significant sales as decline in sales can reduce the revenues. The market has growth opportunities, but these products have not been able to take benefit of these opportunities in an effective manner. The company has to spend millions of dollars on brand awareness and promotional activities in order to maintain its market share. Figure 3: BCG Matrix for Coca Cola Company (Source: Ahmad et al 2007) Porter’s Five Force Model for Coca Cola. 2015. Since the industry is mature, the company needs to invest little effort to keep the sales high as the business unit has captured a large market to generate cash. The corporation's primary roles are to manufacture, retail, and the marketing of beverage syrups and concentrates. Stars: Honey Nut Cheerios, the leading product in the category of breakfast cereal in the USA is a great example of a star product from General Mills. Available at:
[Accessed 12 September 2016]. Murphy (2015) has mentioned that in an effort to keep the market share of the leading brand of coke (which is cash cow for the organization), coke life was presented to the market. To cater to different customer segments and their needs, coke is looking out at launching different variants of bottled water EG: Apart from just simple bottled water, Coke also offers Kinley and Dasani sparkling water (just to cater to affluent customers). BCG Matrix of The Coca Cola Company. It was established in 1886. The products that are viewed as stars are defined by the key feature of having a high market share as compared to the other products which have a lower share in the market. Carousel Previous Carousel Next. The BCG Matrix for Coca-Cola is as follows: Cash cows are those business products which are a significant source of income for a business entity and generate enough sales to obtain a significant market share in the local or global industry. Ferdos Chowdhuri. (adsbygoogle = window.adsbygoogle || []).push({}); Designed by Elegant Themes | Powered by WordPress, https://www.theguardian.com/news/datablog/2015/feb/13/coca-cola-us-public-losing-taste, http://www.wsj.com/articles/coke-profits-jump-20-despite-dollar-impact-1437565369, http://www.wsj.com/articles/coke-begins-to-win-back-investors-1460799004, http://fortune.com/2015/10/23/diet-coke-sales-plunge/, http://www.news.com.au/finance/business/other-industries/spork-life-dysfunction-at-the-heart-of-cocacola/news-story/e02d21493c23b58c4ff48bb96cbb3de7, http://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/investors/2015-annual-report-on-form-10-k.pdf. Mushtar Hossain. With an aim to cater to the changing needs of consumers to zero calories and no sugar drinks, Coca-cola company has launched a number of products/brands to cater the same. As indicated by Kell (2015) the brand has received relatively favourable response in the past, however recent data shows that the brand is losing its popularity. The rising number of people increases the need to produce more bottled water to fulfil the needs of the expanding population. Then, prepare a SWOT Matrix for the Coca-Cola Company. These are low growth or low market share products and have very few chances of showing any growth. 3 reasons why Diet Coke sales will keep plunging. The Boston Consulting Group (BCG) matrix was used to … The products in this segment can either grow and become stars or cash cows for the company or can turn into a bad investment. It was invented in 1886 by a pharmacist John Stith Pemberton. Let’s check out the BCG Matrix of Coca Cola and what products of the company fall under what Quadrant. Cash cows are those business products which are a significant source of income for a business entity and generate enough sales to obtain a significant market share in the local or global industry. Arnett, G., 2015. Cash Cow examples: iPods of Apple, Coca-Cola Classic of Coca-Cola, Procter and Gamble which . Kinley and Dasani: Kinley and Dasani are still bottled water brands owned by Coca-Cola and offered in different countries in markets. Cashcows are the products that have a high market share in a market that has low growth. These products are the money churners for the company and require very low investments to sustain their leadership and profitability in the market. Here is a gist of points that we covered about the 4 different quadrants of the BCG Matrix. Coca-Cola as a beverage … on BCG Matrix on Coca-Cola Names of Group Members. A star in Coca Cola Company is its Let’s check out the BCG Matrix of Coca Cola and what products of the company fall under what Quadrant. BCG matrix is a framework created by Boston Consulting Group to evaluate the strategic position of the business brand portfolio and its potential. Even though the company faces competition from other bottled water producers, the growing market offers it significant opportunities to attain a large market share and expand it further in future. BCG Matrix - Boston consulting group group analysis of companies SBU, product lines, products and services. Growing healthier lifestyle trends and emerging markets have prompted the brand to invest a large amount of capital in healthier beverages in order to differentiate itself from competitors and grow brand awareness and market share. BCG MATRIX. These quadrants are made according to the market share and growth rate of products. Here are a few examples to help you understand the quadrants of the concept even better. It consists of a 2×2 matrix with four categories apparently named by a 3-year-old: If you've taken business class or familiar with management consulting strategies, you've probably come across this tool called a BCG Matrix. Products which are market leaders in their specific industry and their industry is not expected to see any major growth in the future are considered as Cash Cows. As a result, companies are interested to invest in developing these units further to gain a larger market share and attain a stronger position in the market. In Europe and Asian regions, Kinley is being sold while Dasani bottled water is targeting the US and UK market. Coke Begins to Win Back Investors. To demonstrate usefulness of Ansoff matrix, we have applied it to Coca-Cola. If your market is extremely fragmented, however, you can use absolute market share instead, according to the Strategic Thinker blog.Next, you can either draw a matrix or find a BCG chart program online. The best way to understand BCG Matrix is to look at some examples of BCG Matrix and start drawing your own. The market is at a mature stage for these products, nevertheless, these products continue to generate cash for the organization. It is available in almost every country and has a history of more than 100 years. Bcg Matrix Of Coca Cola. Even though in some regions minute maid has been able to obtain a generous sales volume of $ 1 billion, the brand has not been able to gain widespread popularity as the coke (Arnett, 2015). The health conscious consumers formulate a significant part of the industry, suggesting the growth potential, but diet coke has not been able to tap this market potential to gain sustainable revenues. Let’s see what are these 4 different quadrants of BCG Matrix: These are the products with low growth or market share. The market is at a mature stage for these products, nevertheless, these products continue to generate cash for the organization. The Boston Consulting Group (BCG) Matrix is a portfolio management tool created in 1970 by Bruce Henderson. The Cola market, as a specific part of the beverage industry has matured over the years, becoming concentrated by various companies selling their own brand of cola. While Kinley is quite a popular bottled water brand in European and Asian countries, Dasani has a quite a stronghold in US market. The products that are included in the category of dogs are a part of mature industry, thus the chances of further growth are limited. Coke – Declining demand for carbonated soft drinks due to increasing demand for low calorie and healthy beverages and snacks is what is attributing the diminishing sales of Coke brand. That’s not it, these also come in different flavors giving the customers a wide range of options to choose from. They operate in a high growth industry and have a high market share and for this reason, they require high cash investment to maintain its market share. The flagship product of the company is Coca-Cola and was the first product the company launched. Highest brand equity – Coca-Cola is undoubtedly one of the most renowned brands with the highest brand equity. Coca Cola is market leader, as a result of which the relative market share of Pepsi is always smaller than 1. Portfolio Analysis for Coca-Cola company using GE Matrix stratigy Documents Similar To Coca Cola Bcg Matrix. The next part of the BCG matrix for Coca Cola deals with Stars. … The article ‘What is Ansoff Growth Matrix’ offers more insights into the matrix. These are the products which are in high growth markets with a high market share. Ife Matrix Efe Matrix Bcg Matrix Swot Analysis Of Coca Cola. We have analyzed the products of Coca Cola according to the BCG matrix and we found that Star products of Coca Cola are Thumps Up and Maaza. These businesses have a high market share in a low growth industry that is mature not declining nor growing. These are the products which are in low growth markets with high market share. Coca-Cola Boosted by Sales of Tea, Bottled Water. It is your reliability asset. Mumin Sheikh. It classifies business portfolio into four categories based on industry attractiveness (growth rate of that industry) and competitive position (relative market share). What is Marketing Mix of Apple and how it’s helping in creating worlds most valuable brand? The stars are said to, “Generate large amounts of cash because of their strong relative market share, but also consume large amounts of cash because of their high growth rate,” according to netmba.com. STARS HIGH GROWTH RATE, HIGH MARKET SHARE CASH COWS LOW GROWTH,HIGH MARKET SHARE QUESTION MARKS HIGH GROWTH,LOW MARKET SHARE DOGS LOW GROWTH,LOW MARKET SHARE. A slowdown in sales has been a temporary setback for the organization, however adjusting the business strategy has helped the management to regain its firm hold in the industry (Estrel, 2016). Segmentation helps the brand to define the appropriate products for specific customer group; Coca Cola doesn’t target a specific segment but adapts its marketing strategy by developing new products.Similarly it uses mix of undifferentiated & mass marketing strategies as well as niche marketing for certain products in order to drive sales in the competitive market. Boston matrix (BCG matrix) At the end of the 1960s, Bruce Henderson, founder of the Boston Consulting Group, BCG, developed his portfolio matrix. Learn more about the 4ps of Marketing Mix, Your email address will not be published. Md. Failure to deliver the expected results makes the product a source of loss for the organization, propelling the management to withdraw future investment in the venture. The market share, potential for growth and annual sales are taken into consideration. Required fields are marked *. It supplies its products to hundreds of countries worldwide. Strong brand identity – Coca-Cola is a highly popular brand with a unique brand identity.Its soft drinks are the most-selling drinks in history. The candy seems have a loyal customer base. It has low growth, but generates good cash flow. However, it was not readily accepted by the targeted market, leading to low sales of the new brand. It has been developed using the blend of coke and diet version of coke to offer the consumers a comparatively healthier beverage option in terms of calories consumption. The products that are categorized as questions marks seem to have a dubious outlook for the future development. The Boston Consulting Group (BCG) Matrix is used in analyzing the various products being sold by manufacturers. You can now modify the BCG Matrix example below using Visual Paradigm's online BCG Matrix tool. It was also awarded ‘highest brand equity award’ in 2011 by Interbrand. The market is still in the phase of development, therefore, the stars have the likelihood of further adding to the existing market share and create a steady source of revenue for a business entity. So, according to the BCG matrix, this candy is your ‘Cash Cow ’- the steady cash flow commodity. Minute maid is one such example where the business units can be seen as a question mark. Coca-Cola: Ansoff Matrix. The Boston Consulting Group Matrix (BCG Matrix) can be used to analyze the different products being sold by the company in terms of their market share, sales generated on an annual basis and the potential for growth. The small market share obtained by the organization makes the future outlook for the product uncertain, therefore investing in such domains is seen as a high-risk decision. Form 10-K. The Coca-Cola Company. You can practice doing it for companies that are well known, like Samsung, Nestle, ITC, Coca-Cola, Apple, etc. Over the years, Pepsi has faced stiff competition from Coca-Cola and has also seen its market share take a hit. BCG matrix was a framework originally devised by Boston Consulting Group to strategically measure the potential growth rate of a company within its industry versus its relative market share. These business units or products are cash traps and therefore are not seen as a useful source of earning. Uploaded by. The corporation receives guidance from the well … The investment strategy for these products has to be very well thought through by the management as there are chances that these businesses might not yield any profit for the organization. The Wall Street Journal, [online] April 16 Available at: [Accessed 12 September 2016]. Therefore, The Boston Consulting Group designed product portfolio matrix (BCG matrix) or growth-share matrix to help business with long-term strategic planning. Mohammad Sajjad Hossain. Fortune, [online] October 23 Available at: [Accessed 12 September 2016]. Coca-Cola is one of the most well-known brands in the world. Spork Life: Dysfunction at the heart of Coca-Cola. The Cola market, as a specific part of the beverage industry has matured over the years, becoming concentrated by various companies selling their own brand of cola. The purpose of the BCG Matrix (or growth-share matrix) is to enable companies to ensure long-term revenues by balancing products requiring investment with products that should be managed for remaining profits.. Introduction Coca Cola is the most famous company that makes soft drinks, not only that but other products also, in this work we’re going to see a history of the company, the BCG Matrix and the SWOT of coca cola, which we’re going to talk about the major strengths and weaknesses and threats and opportunity which set and make coca cola stand out and step ahead to be the market leader. The Wall Street Journal, [online] July 22 Available at: [Accessed 12 September 2016]. Smartwater, Honest Tea, Sparkling water, Minute Maid are few brands/products which fall under the Question Mark quadrant. The bottled water produced by the Coca-Cola Company can be categorized as a star for the organization. Read about the Brand Positioning of Samsung and understand its Segmentation, Targetting and Positioning, Learn about the Positioning of Apple and understand its Segmentation, Targetting and Positioning. Dogs are those products that were perceived to have the potential to grow but however failed to create magic due to the slow market growth. The Coca-Cola Company is an American based multinational corporation that is engaged in the manufacture, retailing and marketing of more than 500 non-alcoholic beverage brands including the iconic Coca Cola. Ali Laeeq. ← BCG Matrix of Pepsi | BCG Matrix analysis of Pepsi, Marketing Mix of Red Bull | 4Ps of Marketing Mix of Red Bull →, These business units or products require high capital investment, They can either become Stars and then Cashcows or and turn in Dogs as well, These are the businesses or products which are in the declining stage. Estrel, M., 2015. The Guardian, [online] February 13. The BCG model, when put into the BCG matrix template, can be varied in nature. Worlds leading ready-to-drink beverage company, Coca Cola company has more than 500 soft drink brands, from Fuse Tea to Oasis to Lilt to Poweradeorlds, but none of them is anywhere close to coke brand in awareness, revenue, and profit. The beverage industry is at an inflection point and is undergoing a major transformation. They are cash traps – Getting a return on investment from these businesses or products is next to impossible. Despite the efforts to target this segment of the market, the brand has not been able to perform well as depicted through the declining sales of this business unit. Ξ In the case of Pepsico, Pepsi falls in the Star quadrant of the BCG Matrix of Pepsi. Coca-Cola Strengths – Internal Strategic Factors. When the relative market share is smaller than 1, you will be at the right-hand side of the matrix. The soda industry has matured over the years, limiting the growth prospects for new products. The BCG Growth-Share Matrix The BCG Growth-Share Matrix is a portfolio planning model developed by Bruce Henderson of the Boston Consulting Group in the early 1970's. The current headquarters are […] Example: Coca Cola and Pepsi. 2349. It spreads its business in India in 1993. Coke brand which is currently regarded as a cash cow for the company will eventually fall in quadrant qaudrant in the future due to all these factors. Md. 1422. A larger segment of the operations is based on finished products (including sparkling and still beverages) manufactured by the company, constituting 63% of the operations in 2015 (The Coca-Cola Company, 2015). Your email address will not be published. The BCG matrix applies the criteria of market growth rate and market share to analyze brand portfolios and allocate financial resources. The Boston Consulting Group (BCG) is a renowned organization. This is a simple example of a BCG Matrix application for google. to better your skills and practice as the information is widely available in public domain. Owing to the growing demand for low calorie and healthy drinks, the bottle watered industry is currently under an evolution phase. Every business needs strategic planning to rule in the industry. by adamkasi | Oct 8, 2016 | BCG Matrix Analysis. The company is investing a lot of capital to create awareness about these brands. There are products that formulate a part of the industry that is still in the phase of development and the organization is trying to create a significant position in the industry. Below are few products which have been the cash cow for the company for all these years: Coke: Coke for years has been a market leader in carbonated soft drink segment and a major cash generator for the company.
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