International Marketing And Business Management
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This report considers international marketing activity of Coca-Cola. It is a US based multinational beverage company and produce that offers over 500 brands in nearly 200 nations, apart from its namesake Coca-Cola soft drink.
The management of Coca-Cola in overseas market. CUBA can be selected as target market because of the fact that Coca Cola products are not yet sold to this country. In this regards, organization selects young age people of Cuba as the target consumers (Efrat and Shoham, 2012). On the basis of needs and interest of young age people, business entity formulates all marketing strategies.
In the process of international marketing, determination of market goals as well as selection business strategies are playing significant role in success of organization. Thus, Coca Cola is also required to set its goal for both marketing as well as overall business operations with an appropriate manner for generating good return from target market of Cuba (Dief and Font, 2010). One of the company’s marketing campaign known as “Share Happiness” has been running in more than 50 countries now across the globe. With reference to corporate vision of firm, SMART objectives provide a basis to managers of Coca Cola for managing various business operations management plans related to marketing of products. With the help of SMART objective, company would get reliable information about performance of company in market Cuba (Stafford, 2012). It assists organization for comparing outcomes and sale performance organization. This goal of the company can be established and discussed in accordance with the objective of running it successfully in Cuba and this is explained as under through SMART framework:
On the basis of above SMART objectives, the management of Coca Cola schedules wide range of operational plans and management practices that could assist organization to attain long and short term goals of company.
Specific: The major emphasis of Coca Cola's marketing plan is to increase market share by 10% till 2016 and sales by 20% in next two yers in Cuba, Coca Cola needs to organize a very aggressive marketing plan that could attract target consumers or segment (Paliwoda and Thomas, 2013).
Measurable: Company can measure performance of and outcomes by analyzing the growth in demand as well as sales of organization. The overall success of Coca Cola can be measured with its profitability objectives in which the company desires to achieve a 5% growth in profit in ever year (Rouillard, 2003). Through this, the success possibilities of Coca Cola can be ascertained.
Achievable: In order to attain these objectives, business entity should have to introduce wide range of products along with attractive pricing. All these factors play very significant role for generating good return of company. Organization can turn these objectives into reality with the help systematic marketing plan. In this, company can uses T-shirts and jerseys for promotion of product with unique test flavors (Choi, 2014).
Realistic: Organization can achieve its objectives related to reduction of operational expenditures by 10% through proper application of latest technologies, assessing various new low cost marketing tools that could reduce overall expenditures of company (Griffith, 2010). In addition to that other sales and profit objectives can be realized with proper market and product planning.
Time: The company is extremely concerned about timescale in which it sets time limits for all objectives. Organization could achieve all the targets within 2 years. For achieving all types of goals and objectives within predetermined time frame, management of Coca Cola needs to subtracts targets of company into various small sub activities. By scheduling time-frame along with arranging resources for each activity, business entity can attain goals on the basis predetermined schedule (Eck, 2013).
Marketing mix is very significant tool that can be used by Coca Cola for managing marketing related operations in Cuba. With the help of elements of marketing mix, business entity can examine various elements that could increase effectiveness of promotional operations (Powers and Loyka, 2010). In this process, company evaluates price, features products, distribution channels and promotional tools.
A product can defined as idea, method, goods as well as services that is developed to meet requirement of an people. It can be considered as combination and of tangible and intangible goods and services (Griffith, 2010). As the likes and lifestyles of people of Cuba, the management of Coca Cola introduces its product Twist as an existing carbonated lemon flavored drink which is the product of Coca Cola can be promoted in Cuba. This product of Coca Cola has gained well reputation in different markets of the world. The soft drink is developed from Carbonated water, sugar, citric acid, stabilzers, preservative (sodium benzoate), flavouring and colourants (tartrazine and green S) (Marse, 2013).
This product contains zero fat, unique tastes, colors and appearance that will greatly encourage target consumers of Cuba (Baines and Fill, 2014). This product of Coca Cola has gained well reputation of market position in different part of world. It has developed a special image of company for managing competition with local as well as international market players in Cuba. In order to get competitive edge over other firm, organization would offer some other flavors such Granadilla, Mango and Naartjie in near future (Gilbert, 2008). All the practices and some unique specification and great test strengthens marketing and promotion related operations. It will develop distinct image of Coca Cola in Cuba along with its soft drinks.
There are various kinds of pricing used by management of Coca Cola such penetrating, market skimming, and neutral pricing. On the basis of profit and sales goals, Coca Cola adopts two kinds of pricing approach on the basis of target consumers. Pricing of company creates huge impact on sales of firm along with goodwill (Vasudeva, 2006). On the basis of demographic, psychographic and geographic segmentation of customers, pricing can be set which must reflect overall marketing strategy of company (Paul, 2008). The drink can be launched in a segment of Cuba that has consumers with middle level income and are scattered in close proximity with one another.
In this aspect, Coca Cola can consider penetrating pricing strategy use for this segment in which product price of product will be offered 44 cents for 200ml plastic bottle It is because of the fact that keeping price low will encourage customers to buy it and cherish its benefits towards health. The price of local Tukola brand in Cuba market for a similar drink is 48 cents. Thus offering a price of 44 cents with a difference of taste will definitely attract the customers in Cuba market (TuKola Cuban Coca Cola, 2015). Strategy for a rich class consumer segment can adopt market skimming with slight modifications in product with the packaging of Aluminum Can. This type of positioning reflects purpose of adjusting higher level pricing for the drink. For rich segment customers, price will be 48 cents and this can be with an aim to encourage them buy a product that appeals their lifestyles (Petty, 2012).
There can be several distribution channels to be used to sell this new product of Coca Cola as it is a convenient to carry product and can involve a number of levels to reach consumers (Dobson, Starke and Richards, 2004). Coca Cola can use both two level and three level distribution channels in Cuba involving agents, manufacturer, wholesalers and retailer. For arrangement of proper distribution network, the management of Coca Cola should have to joint partnerships with various supper market chains, retail stores and departmental stores (Hebblethwaite, 2012). In this process, company can use existing network of big domestic distributor to make available products of Coca Cola in each shop.
Coca Cola considers young age people of Cuba as the target consumers. For meeting of requirement of young people at different places, management of Coca Cola develops various strategies. In this regards, business entity develops contract with canteens of schools and colleges (Smith, 2013). This approach increases sales of company and price of new Twist product will attract more target consumers. With the help of this method, company can improve its customer base. In addition to that marketing managers also offers its soft drink in restaurants by developing contract or joint agreements with nation and international retail food chains along with domestic restaurants. By following this strategy, business entity can reach to each consumer belongs from different market segments (Marse, 2013). Organization also offers special discounts and offers at supermarket and departmental stores of Cuba at various soft drink products that could attract target consumers.
Promotion plan is to be created and implemented when pricing level and strategy as well as distribution channels are adopted for Coca Cola’s Twist. This plan will be a part of overall corporate objectives of company which will involve a detailed list of actions and costs required to make it successful in targeted country (Choi, 2014). Coca Cola should consider using AIDAS’ model to have effective marketing and promotion of Twist in Cuba. The model is discussed as under:
Attention of consumers is on the most important aspect of marketing operation. The success of marketing activities of Coca Cola is greatly depending on attention of consumer. For Twist as the product of Coca Cola, company can run its promotional campaign which is targeted to young consumers to initially promote the product in Cuba. In this regards, Coca Cola can gain by participating in The International Havana Jazz Festival. In this process, company can present a marketing song of with the performance of various Jazz stars (Dost, 2006). In addition to that firm can use banners on highways and streets where mass of travelers can be found. This should be followed by developing of attractive messages that generates curiosity among viewers. The messages can be such as “Share a Coke” or even some interrogative type statements that develop responsiveness among customers (AIDAS theory of selling, n.d). In addition to that business entity can use various other strategies such as sponsoring sports events, social youth parties, musical shows and other related functions that can be a compliment to the brand image of company. Musical events will certainly aid in developing effective attention among young consumers.
Next stage is to develop interest among viewers and this can also be skillful as it requires a strategy that makes observers to find something of worth in it. Once the attention is gained, it is very important that interest is to be maintained as it is one of the most crucial parts of sales process (Paul, 2008). For this, Coca Cola must consider using its trump card in terms of celebrity endorsement, or even an offer for instant promotion. In this aspect, Coca Cola can use The Pepe Trova Festival and The Low-Budget Film Festival along with celebrity endorsement in order to promote new products and services. With the help of these event, organization can maintain interests of customers within marketing operations and drink products of Coca Cola (Gulati and Ahmed, 2013). In this way, this stage must be implemented to prepare well for the next one as Desire.
This concept can be considered as third aspect of AIDAS approach. This concept involves creating desires among viewers to buy a product or service. It can be created by providing positive motivators as well as by element of fear. For this, Coca Cola could use sales personnel which are trained enough to showcase the product in a manner that certainly develops a thought in the mind of customers regarding buying the same (Eck, 2013). In this aspect, organization can use small temporary stalls at malls in Cuba, sports of festival events such as Havana International Guitar Festival as well as push carts at a number of places in Cuban markets. In this regards, Sales personnel plays significant role in order to generate desire for customers. In this process, sales personal can influence desire of young age people of Cuba by providing detail description of quality and taste of new soft drink Twist to end users (Gilbert, 2008). The communication and presentation skills of sales person greatly encourage desires of young age people. Furthermore, distribution of sample of drink can boost up desires of target consumers.
There can be a situation when customers want to buy a product as a result of their desires but yet they might not buy it. In this aspect, it becomes difficult for a company to increase sales (Kleindl, 2006). Thus, Coca Cola can induce Cuban customers using a number of ways such as handling unreasonable demands, complaints and by using colorful language. In order to attract more consumers, Coca Cola offers a new lemon drink Twist which is based on interest of people in beverages such as herbal elements. In addition to that management also offers its soft drink in low cost as compared to domestically popular drink Tukola that could attract more consumers. The management of also use of e-commerce will be sound and beneficial for this stage as it will provide customers with both time and place utility (Stafford, 2012).
This stage comes when once the product is sold to customers. Coca Cola may use a number of strategies to generate an element of trust such as TV ads, posters and magazine articles to provide promotional information regarding benefits of consuming Twist, the lemon flavored carbonated drink as a product to boost health (Smith, 2013). In addition to that management of Coca Cola also follows all food and quality standards determined by government of Cuba that can increase satisfaction of consumers. The pricing of new drink and facilitation of best services to consumers at retail outlets of firm boost up satisfaction of buyers. Organization also presents laboratory testing reports in front of consumers for boosting confidence level of people (Petty, 2012). In this process, organization also manages regular conversation through emails, mobile calls, social media and website of company to assess reviews and feedback of buyers.
As per the SMART objectives of Coca Cola, the management wants to increase sales of company by 20% till 2016. In this regards, business entity manages marketing campaign for two years that will run throughout a year with a number of activities involved in promotion (Efrat and Shoham, 2012). With reference to SMART objectives, Coca Cola wants to increase 10% market share in next two years. In this regards, business entity will apply Guerrilla marketing in all four quarters of first year. This approach will increase awareness among people about product of Coca-cola. It will be becomes of the most expensive marketing strategies as well as a promotional activity for company. This approach will increase sales of company.
In next session, company use outdoor media between period of 2nd quarter of 2015 to 1st quarter of 2016 such as banners, posters etc (Moran, 2012). All these tools can be used on highways and roads of Cuban cities in order generate desire among young people about new Twist lemon drink. In next stage, Coca-cola can present special image of by sponsoring the various festivals and musical events within 3rd quarter of 2015 to 2nd quarter 2016 during festival seasons such as Havana International Guitar Festival, The Pepe Trova Festival, The Low-Budget Film Festival and The International Havana Jazz Festival This is also a good approach to promotion (Choi, 2014). It is a very effective approach in order to increase goodwill of firm as well as to attain stable growth rate in profit of firm. This is to be followed by Social media promotion that will be actively managed between the period of 4th quarter of 2015 to 3rd quarter of 2016. Social media can be cheap and effective for meeting almost all marketing objectives of a firm.
Between the period of 4th quarter of 2015 to 3rd quarter, organization uses Celebrity endorsement in order to attract more young age consumers that will boost up the sales of firm. The more happening and famous the event appears to be, more will be its cost and publicity. At last (Paul, 2008). Coca Cola uses various newspaper and magazine to connect with huge number of customers in the country. It will prove to be a cheaper source for promotion for long duration and organization can reduce its expenditures.
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