Coca Cola Case Study - Part 2
1- Discuss the attitude and related beliefs towards Coca-Cola of intensely brand-loyal consumers (perhaps like those who were upset by the new Coke in 1985). How might their attitude and beliefs differ from those of less involved, less loyal consumers? What marketing implications would these differences have? Answer: For those types of consumers they have a strong positive attitude toward the Coca-Cola brand.
And this can surpass what the company can imagine to even reach the level of having a highly emotional and self relevant to the brand; it became associated with consumer’s lifestyles and self-image. Because consumers want to be satisfied, they get satisfied based on past buying experience, brand connotation, the firm’s promotions, the price …etc. ll these were available for Coca-Cola’s consumers which made them more than satisfied with it, more over they reached the level that they couldn’t live without it, as it has been a part of their lives. Those attitudes and others made people cross the known limits for being loyal and even go out protesting against the company for its decision to stop producing the old Coca-Cola and replace it with a new one with a different taste. How might their attitude and beliefs differ from those of less involved, less loyal consumers?
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No doubt there will be big differences between loyal customers and those less loyal ones in terms of their attitudes and beliefs towards Coca-Cola, people who are less involved will not react in the same way as those loyal consumers when the company announced that it will stop the main brand of Coca-Cola, they might be ready to try new types of Coca-Cola and they could easily switch to other brands, because they don’t feel that there is a bond between them and the product, while we can see how loyal consumers feels that Coca-Cola is part of their life, those who are less loyal would not mind trying anything else even if it means not drinking soft drinks and going to other products. For example, when boycott campaigns happen against Coca-Cola, u will find that its loyal consumers find it difficult to boycott it, and will even try to defend it and justify their continuous buying for it while those who are less loyal will boycott in real, and may not purchase it again. What marketing implications would these differences have?
It’s obvious that marketing implications would be so different, with loyal consumers than those less loyal ones. With loyal consumers the company will have to focus more on maintaining the relationship with them by giving them the feeling of communication with them through giving them hard and soft benefits and having loyalty programs. With loyal consumers the company has to be careful in considering consumers feeling towards the product and making the product associated with a positive memories such as associating it with holidays, parties, graduation, playing a sport with a friend, a first date, or seeing a movie, and having it implemented on their promotion plans.
While with less loyal consumers the company will implicate different ways of marketing strategies such as giving them different offers for the product and changing the remaining strategy from time to time in order to gain their loyalty by time “as Coca-Cola did with its loyal consumers” 2- Do you think it possible for consumers to be loyal to more than one brand of soft drink? What about more than one brand of Cola? Discuss the pros and cons of having several brands in a product category (as do Coca-Cola and Pepsi in the cola category). Compare the strategy of line extension to that of creating completely distinct brands for these products. What factors should marketers consider in making this important decision? Answer: I don’t think it is possible because the word loyal refers to being involved with one only thing and giving all attention to that thing, let’s say in the case of when Coca-Cola decided to stop producing the old Coca-Cola on 1985 and to come out with the new Coke as it planned, and we had one consumer who was loyal to Coca-Cola and Pepsi at the same time, and he was disappointed from this decision and was one of those who even protested against Coca-Cola for taking this decision, then Pepsi did the same thing, his reaction wouldn’t be the same with Pepsi, and his reaction wouldn’t reach that level that it was with Coca-Cola, which explains why I think that consumers can’t be loyal to both brands at the same time.
Simply consumers’ emotions and bonds wouldn’t be the same for both products; it’s either to be with this or with that. What about more than one brand of Cola? I think it’s possible to be loyal to more than a brand of Cola in cases where each brand has its moment, for example someone may be loyal to a specific brand when its bond to a specific memory such as going to a movie while in different occasion where he is used to see the other brand always accompanying him there, let’s say a sport occasion or a party. In this case he may be loyal to both brands but each has its moment. Discuss the pros and cons of having several brands in a product category (as do Coca-Cola and Pepsi in the cola category).
The main pro of having several brands in a product category is that it gives the company the chance to win a bigger share in the market as Coca-Cola did when it 1st introduced its new Diet Cola and later had it taking the 3rd place after the main Coca-Cola and Pepsi, but I think this should only be applied when there is a real need for a new product and when it’s possible for a 3rd competitor to come in the market, so instead of loosing that and having a 3rd party sharing with them a market they could be this third party. But such a step has to be a careful step because the main cons of this is that if the company keeps in coming out with new brands more and more without having any limit for that step they might have their loyal consumers lose their fond memory by time when they keep on seeing all of these new brands that holds Coke brand logo on their packages, Coca-Cola understand that basically memory is the main reason they had brand equity to Coca-Cola. Compare the strategy of line extension to that of creating completely distinct brands for these products.
The main point when having a line extension is that this new brand is designed to compete in the category without damaging the existing item’s market share and this happens by targeting a total different group of consumers. So with a line extension the company will have to be careful not to affect its existing consumers, it will have its promotion plans based on the main product which is supposedly strong in the market. While with a completely distinct brand the company will target a bigger range of consumers and try to take over those consumers of other brands and have heavy promotion to gain as much consumers as possible. What factors should marketers consider in making this important decision?
The factors have to be considered are customer segmentation, consumer desires, pricing breath and flexibility, excess capacity, competitive intensity, trade pressure, and short term sales gain. Kapferer (1992). 3- Many marketers made a distinction between customers and consumers. For instance, Coca-Cola sells cola syrup directly to its customer, the operators of bottling plants. The bottlers sell bottled Coke products to retailers, vending machines operators, restaurants, airlines, and so forth. Those organizations, in turn, sell Coca-Cola products to individual consumers who drink it. Discuss how the salient beliefs about Coke products might differ for customers and consumers. How might their attitude toward Coke differ? Who should Coca-Cola pay more attention to – its customers or the consumer? Why? Answer: Customers beliefs would totally differ from consumers, for customers their demand for Coke is based on consumers’ demand, they might have a certain attitude towards the product but it want be as strong as consumers, because their demand relate directly to consumers demand.
Who should Coca-Cola pay more attention to – its customers or the consumer? Why? Of course Coca-Cola has to give more attention to its consumers, because they are the ones who are making the final purchase, if consumers purchase less while in terms of customers they will actually demand Coca-Cola when they find that more consumers are asking for it. For this the real positive attitude towards the products and the high emotion comes from consumers whom Coca-Cola becomes more associated with their lifestyle and self image, not the customers. – Discuss Coca-Cola’s various strategies for managing brand equity of its many products. For instance, what are the pros and cons of borrowing versus creating brand equity? Analyze Coke’s attempt to “revive” brand equity by reintroducing the contour bottle around the world. Answer: Coca-Cola has different strategies for managing brand equity, for example they have strategies in term of designing their product, and they have strategies in terms of sales, cost efficiencies and even decline in its carbon footprint. “It’s about connecting the value we can create for our business,” said Butler. “We have a lot of very clear objectives around sustainability and productivity for our company.
Coca-Cola is also has so many brand strategies, they do it by raising consumers reinvention of its brand and focusing on brand enhancement. Coca-Cola’s brand strategies focus on the changing market realities and consumer sophistication that needs different approach and brand redesigning. For example, in the early years, the company focused on making the brand affordable, available and acceptable in the aim of establishing a brand that would be instantly recognizable and highly appreciated in consumers’ minds. Over the years, and in an effort to adjust its branding strategies to the new consumer demands, Coca-Cola focused on building brand identity by offering value for price, differentiation to meet consumer preferences, and pervasive penetration.
Today, by testing at least 20 different brands on a monthly basis on a sample of 4,000 consumers, Coca-Cola is a corporation with strong brand identity and brand image. For instance, what are the pros and cons of borrowing versus creating brand equity? The pros of borrowing brand equity is that it makes the mission of delivering the message much easier depending mainly on the top brand that its taking the title from, it’s also efficient because it costs less. But we have to understand that it’s not as easy and simple as it seems. Borrowing can be risky because you are using the equity of other brands to promote yours, and any negative perception of that brand can affect your brand, and any failure in your brand can affect the top brand.
In Coca-Cola’s case it was so successful in borrowing brand equity, for example, when the company sponsored the 1996 Olympics it did that to promote for Sprite. Due to the high reputation of Coca-Cola it was a major success for the company. Analyze Coke’s attempt to “revive” brand equity be introducing the contour bottle around the world. The first contour bottle of Coca-Cola was born on 1916 when bottlers of the company worried that the straight-sided bottle for Coca-Cola was easily confused with imitators. So they asked glass manufacturers to offer ideas for a distinctive bottle. The Root Glass Company of Terre Haute won by introducing the contour bottle, which became one of the few packages that have granted trademarks status by the U. S After several years Coca-Cola made several changes in the design but at the end it had to go back to its old design after it understood its consumers more and how they are connected to the product more, giving back its old design shows how consumers of Coca-Cola have a strong emotion towards it, and how it keeps on giving back memories of their days with Coca-Cola, there is no other product in the world that has been part of peoples life as Coca-Cola. It is indeed an old friend to them.
5- What is your opinion about the effects on consumer attitudes and intentions of Coca-Cola proliferation of choice alternatives? Why do you think so? Answer: Even though the study case indicates that consumers want variety in their soft drinks and attributes the decline in overall soft drink sales to consumers boredom with the current offerings on the shelf, and that if consumers are asked if they want more Coke choices that most would respond yes. I think having a big variety of Coke products in the shelf is not effective. Simply because Coke is not other products, and that people desire continuous designs of cars doesn’t mean that their behavior would be same towards Coke. This case study has been talking a lot about how people behave towards Coke and specifically Coca-Cola. It’s simply a unique product that what is implemented with other products can’t be implemented with it.
When it comes to Coke people simply like Coca-Cola because it is Coca-cola. There is no mind of having some additional products such as Coke diet and Sprite. But having so many products under Coke makes it looks like these products are forgetting the main reason of their existence which is to compete with any other product that may be against the main brand, and to cover the gap that might exist in the market such as when they came out with Coke-Diet, and at the end this big number of line extensions make them start to fight against each other in the market and brings confusion to customers who will be faced with many choices and end up not being loyal to any.