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Monday, June 14, 2010

Market Analysis Coca Cola

Market Size
Coca Cola is one of the leading beverage companies in Pakistan. It covers the large market segment. From the facts it is revealed that the market for coca cola as mentioned in the SWOT analysis segment is encouraging. It is the second largest usage in Pakistan. Still it has a great potential in Pakistan market. It focusers on it deficiencies and try to over come it than it will definitely grow more than any other beverage company in Pakistan. So it has a large margin for growth.

Growth rate Coca Cola
In Pakistan market the growth rate is 22% which is a significant rate. Similarly In Asia region the amount of revenues which company earn is 5052 dollar.

Market Share
Coca cola has doubled its market share in Pakistan, in recent years its market share was 16% but in 2007 its market share increased up to 36%, on the other hand its competitors share is going down day by day.
Coca Cola is world leader in beverages, and is on the way to success in Pakistan and has crossed the Pepsi last year..

Major factors influencing the level of demand of the product
There are a lot of factors that affect the demand of the product. The list of these factors is given below
·         Price
Price is the major factor that affects the demand of the product. If the price Is not suitable to the consumers or customers than they will switch of the product.
·         Quality
If a company provides the quality services or products than the demand of the product also increases. In the quality of the product the consistency in the performance of the product is very important.
·         Supply
Supply and the demand of the product are the market forces and played the main role in the product demand. If the supply of the product decreased than in some cases the demand of the product increase as well as the price f the product can also increased. 
·         Taste
Taste of product is the major factor that affects the demand of the product. Like if the product is of good taste than the future demand of the product will increase and vise versa. If customers don’t find the taste of product according to their taste, than they will not buy that product in future.
·         Number of users
If the number of users increase in the market than the demand of the product also increases.
·         Income
Income level of the customers had a great impact on the demand of the product. It directly relates to the purchasing power of the customer. If customer has a purchasing power than definitely he can buy the product which he/she demand.
·         Competitors
Competitors are the biggest threat to the demand of product. If competitors offer the same products as the company offers than the customers got more alternatives. So increased alternatives, increases the bargaining power of the customers and they can switch of to more suitable product.

Can the market be broken down in to segments?
The coca Cola has a wide range of consumer. Though its market is very large and almost all are f its customers regardless of age and gender but the youngsters are it’s the largest most favorable target audiences. This is the reason they choose youngster in their advertisement as well.
Company can also largely focus on youngsters to set the target market. But their current strategy is most suitable because customers regardless of age factor like Coca Cola as soft drink. 

Product Life Cycle
Products go through various steps throughout their useful lives.  They are introduced, grow, mature and eventually decline.  In the introduction phase of the life cycle, start-up expenses are high and sales are low.  This is the stage in which the product in placed in the market for consumer use.  Sales begin to increase and expenses tend to decrease during the growth phase.  This is the point in which the product becomes more known in the market and consumers begin purchasing.  During the mature phase of the product life cycle, the company must re-examine the product and determine new ways to make it marketable.  Consumers begin to take the product for granted and no longer necessarily choose it first.  If a new product comes in at this point with new, more attractive features, it can force the product into the decline stage.  Eventually sales will begin to decline and the company must decide whether to continue with production or to part ways with the product.
Coca-Cola has been in the industry since the nineteenth century, so if they continue with the same marketing strategy, then they will send themselves irrevocably into the decline stage. Coca-Cola (Coke) is in maturity stage but gradually moving towards the declining stage of the product life cycle. Management has to pay special attention to products during this stage of the product life-cycle. The company must now determine whether they will stop producing Coca-Cola, change the soda, find new uses for it, seek new markets for the soft drink or if they will maintain their current strategy (Peter, 2006).  At the moment, the soft drink company is attempting to effectively seek new markets.  Coke’s core product, Coca-Cola, has received many criticisms because of the health issues that arise from its use of caffeine and high fructose corn syrup.
Coke knows that they must begin to acknowledge the shift in consumer tastes in order to remain competitive.  They have done this successfully many times in the past, as can be seen with the introduction of their popular Diet Coke brand.  Coke must break into the non-carbonated drink market in order to acknowledge consumer’s new interest in healthy drinks
During the maturity stage, products usually go through a slowdown in sales growth. According to Coca-Cola’s 2001 annual report, sales have increased by 1.02% compared to last year. This percentage has no comparison to the high level of growth Coca-Cola enjoyed during its growth stage.

Fluctuation in demand with cyclical factors
Nothing is in isolation in this world. The brands also have personality and thus also affected by the different situations like weather, occasions, events, economical factors etc.
Demand of the product doesn’t remain consistent because it exists in the real world which is gradually changing. Coca Cola advertisement has a great affect in its demand. Its advertisement removes the risk of no use of brands on different extreme weathers like in winters. Its ads stimulate its purchase regardless of weather or cyclic factors.
Similarly on different events the buying patterns also changes. Company has a great strategy that they use those events as their strengths and advertise their product on right time which results in increase sale. 


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