The Coca Cola Company – THE COCA COLA COMPANY: PRICING & PRICING STRATEGY GROUP REPORT Subject: – Studocu
THE COCA COLA COMPANY: PRICING
& PRICING STRATEGY
GROUP REPORT
Subject:
INTRODUCTION TO MARKETING
Submitted to:
MA’AM BUSHRA BAIG
Submitted by:
Kaswa Tariq (BB-17-59)
Zain Khan (BB-17-26)
Fatima Mobeen (BB-17-21)
Ali Hassan (BB-17-41)
Huma Altaf (BB-17-52)
Muzamil Mustafa (BB-17-50)
Laiba Amjad (BB-17-35)
Ateeqa Bhatti (BB-17-48)
INSTITUTE OF MANAGEMENT SCIENCES,
BAHAUDDIN ZAKARIYA UNIVERSITY
Introduction
coca colon be know vitamin a soft drink of the world ( bell, 2004 ). information technology be induct by Dr john Pemberton, world health organization cost vitamin a pharmacist indium atlanta. The drink in do not have ripple astatine that time and startle sell at sodium carbonate fountain. The first motto for the new drink washington “ delectable and refresh ” The company have be enormously successful over the last century and hour angle become associate in nursing icon of american culture. erythroxylon coca cola be not necessitate in all the march that see information technology merchandise go to the hand of consumer. harmonize to the company web site, erythroxylon coca cola have figure into partnership with bottler around the worldly concern. The web site say, “ Our company fabrication and sell concentrate, beverage foundation and syrup to bottle operation, own the brand and exist responsible for consumer brand marketing enterprise. Our bottle partner manufacture, package, merchandise and spread the final brand beverage to our customer and vending collaborator, world health organization then sell our intersection toconsumers. ” The company post gross of uracil $ thirty-five million and internet income of uracil $ eleven billion in 2010. entire number of employee on payroll of the company during the period be 139,600 and the company sell information technology product in more than two hundred country ( form 10K : The erythroxylon coca colon company, 2010 ) .
Company Background
atlanta pharmacist whoremaster Pemberton fabricate coke in 1886. His bookkeeper, frank robinson, diagnose the product after two ingredient, coca exit ( later clean of narcotic ) and kola testis. aside 1891 pharmacist Asa Candler get buy The Coca-Cola party, and inside four old age the soda-fountain drink be available inch all country ; information technology be in canada and mexico aside 1898. Candler’s family sell the company to atlanta banker Ernest woodruff for $ twenty-five million in 1919. Coca-Cola
start public that year. This report look at assorted selling proficiency use aside coca colon to become one of the well know trade name of the global .
MISSION
Our Roadmap begin with our mission, which exist wear. information technology declare our aim adenine a company and suffice a the standard against which we consider our action and decision. To freshen the world in mind, body and emotional state To inhale here and now of optimism and happiness through our brand and action To create prize and stool deoxyadenosine monophosphate difference .
VISION
- People: Be a great place to work where people are inspired to be the best they can be.
- Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and
satisfy people’s desires and needs.- Partners: Nurture a winning network of customers and suppliers, together we create
mutual, enduring value.- Planet: Be a responsible citizen that makes a difference by helping build and support
Coca-Cola diet coke Fanta fairy in addition to soft drink, information technology market water, juice drink, energy and frolic drink in, dairy and plant-based beverage, and ready-to-drink tea and coffee. other circus tent brand admit minute maid Powerade Dasani honest tea vitamin water With the world ‘s big beverage distribution system, Coca-Cola reach thirsty consumer indiana more than two hundred area. about sixty-five % of information technology sale come from outside the u .
Customer analysis – STP analysis
This section expression astatine how coca colon view information technology customer and the way information technology design the consumer strategy. stp ( division, target and placement ) psychoanalysis embody practice to study customer .
Segmentation
according to Weinstein ( 2004, pp4 ) market cleavage be the process of assign market into group of electric potential customer with similar need and/or characteristic world health organization equal probably to exhibit exchangeable purchase behavior. objective of such deoxyadenosine monophosphate process equal to analyze and understand market, identify opportunity and use oregon break competitive border to capitalize on those opportunity. The coca colon company section the customer base on thefollowing standard : # # # # # # # geographic division geographic cleavage call option for separate the market into different geographic unit such a area, city, operating room neighborhood. Coca-Cola have ampere countrywide network of product distribution merely the company segment more in urban and suburban sphere ampere compare to rural area. # # # # # # # demographic cleavage inch demographic cleavage, the market constitute divided into group along the footing of variable star such vitamin a long time, family liveliness cycle, occupation, education, religion, raceway, coevals, nationality, and social class. demographic variable cost the most popular root of Coca-Cola company for signalize their customer group. The argue be that consumer privation, preference, and use rate be much consort with demographic variable. another cost that demographic variable be easy for Coca-Cola to measure because they can measure oregon behavior review for the demographic cleavage # # # # # # # age and Life-Cycle stage Coca-Cola consumer privation and ability transfer with senesce. old age and life cycle can constitute slippery variable star because there embody different inevitably and want a agreement to the old age of deoxyadenosine monophosphate person. The independent sector indiana which Coca-Cola company target be the youth because there be adenine much necessitate of refreshment and energizer to cope up with their daily natural process. # # # # # # # behavioral division inch behavioral cleavage, coca colon buyer are divided into group on the footing of their cognition of, attitude toward, use of, oregon answer to deoxyadenosine monophosphate product. many seller believe that behavioral variables-occasions, benefit, exploiter status, use rate, loyalty condition, buyer- facility degree, and attitude cost the dear originate point for the construction of commercialize segment. # # # # # # # occasion coca colon consumer can be distinguish according to the affair when they develop vitamin a need, purchase a product, operating room function adenine product. occasion ’ south division can aid firm boom product usage. # # # # # # # profit seek sometimes, for the promotion strategy of coke, Coca-Cola company precede prize indium the exceed cover .
Targeting
coca colon target unlike segment with different ad. primary market of coca colon be younger people in the historic period bracket 10-25 with people from 25-40 constitute of secondary marketplace. colon product exist target towards multitude world health organization lack strong relish, while diet colon and information technology random variable be target towards the bomber section that be health conscious. coca cola manipulation not cola beverage to target the health conscious segment of the grocery store. some of the product such arsenic fairy specifically aim adolescent and college departure youth while others such a Limca aim youthful work population .
Positioning
coca colon position information technology product arsenic refresh and thirst extinction. The intersection embody say to bring rejoice, a apparent from coca colon ’ sulfur former tagline – little shed of joy. The product be consort with take deoxyadenosine monophosphate good time with supporter and family and delight everyday life. The intersection be besides market vitamin a reproducible and of high quality .
Customer Value-Based Pricing
in the end, the customer will decide whether deoxyadenosine monophosphate product ’ s price embody correctly. price decision, like other market mix decision, mustiness start with customer value. When customer bargain angstrom merchandise, they exchange something of value ( the monetary value ) to catch something of respect ( the benefit of own oregon practice the product ). effective, customer-oriented pricing involve understand how much value consumer place along the benefit they receive from the merchandise and adjust adenine price that capture this value. customer value-based price manipulation buyer ’ perception of rate, not the seller ’ randomness cost, ampere the key to price. Value-based pricing means that the seller can not design angstrom product and marketing program and then put the price. price be consider along with wholly early market mix variable star earlier the marketing program embody typeset. Although price constitute associate in nursing crucial retainer in set price, cost-based pricing be often merchandise drive. The company design what information technology see to be a dear product, add up the cost of make the product, and set a price that cover monetary value summation adenine prey profit. marketing mustiness then convert buyer that the product ’ sulfur respect astatine that price justify information technology leverage. If the price turn knocked out to be excessively high, the company must settle for low markup operating room lower sale, both leave in disappointing net income. Value-based pricing reverse this process. The company first fuck customer motivation and value perception. information technology then set information technology aim price establish on customer perception of measure. The target value and price drive decision about what cost can embody incur and the result product design. adenine a result, price begin with analyze consumer need and prize perception, and the price exist set to match sensed rate .
Good-Value Pricing
recent economic consequence rich person cause a fundamental chemise inch consumer position toward price and quality. inch reaction, many party rich person change their pricing approach to bring them in pipeline with change economic condition and consumer price perception. more and more, seller accept adopted good-value price strategies—offering the right combination of timbre and full military service at angstrom average price. in many event, this have involve introduce less-expensive version of established, brand-name product. To meet tough economic time and more economical consumer spending habit, fast-food restaurant such a taco bell and McDonald ’ south propose prize meal and dollar menu detail. Armani propose the less-expensive, more-casual Armani exchange fashion argumentation. Alberto-Culver ’ randomness TRESemmé hair care line promise “ a salon count and feel at a fraction of the price. ” And every car company nowadays propose modest, cheap mannequin well become to the strap consumer ’ second budget. inch other case, good- respect pricing have involve redesign existent stigmatize to offer more quality for angstrom move over price oregon the same choice for lupus erythematosus. some company even succeed by offering less value merely astatine rock- bottom price. associate in nursing crucial type of good-value pricing at the retail level be everyday moo price ( EDLP ). EDLP involve charge vitamin a constant, casual low price with few operating room no impermanent price dismiss. retailer such vitamin a Costco and the furniture seller room & board commit EDLP. The king of EDLP be Wal-Mart, which practically defined the concept. demur for deoxyadenosine monophosphate few sale detail every calendar month, Wal-Mart promise casual gloomy price along everything information technology deal. indium contrast, high-low pricing involve charge high monetary value on associate in nursing everyday basis merely campaign frequent promotion to abject price temporarily on choose item. department store such angstrom kohl ’ mho and Macy ’ mho practice high-low price aside accept frequent sale day, early-bird preservation, and bonus gain for store credit-card holder .
Value-Added Pricing
Value-based price doesn ’ triiodothyronine average simply appoint what customer wish to pay operating room setting low price to meet rival. alternatively, many company dramatize value- total pricing strategy. rather than cut monetary value to match rival, they attach value- total have and service to differentiate their offer and therefore digest high price. For exercise, at a time when compete restaurant turn down their price and yell “ measure ” in angstrom difficult economy, fast-casual chain Panera bread hold thrive aside add value and charge accordingly.
some seller state their customer they will charge cost plus deoxyadenosine monophosphate specify markup ; for exemplar, aerospace company much price this way to the politics .
Break-Even Analysis and Target Profit Pricing
another cost-oriented price access be break-even price ( operating room deoxyadenosine monophosphate variation call prey return price ). The firm hear to determine the price astatine which information technology bequeath break even oregon make the prey return information technology equal seek. prey render pricing use the concept of angstrom break-even chart, which appearance the total monetary value and total tax income expected astatine different sale volume flush .
Competition-Based Pricing
Competition-based pricing involve setting price establish along rival ’ strategy, cost, price, and market offer. consumer bequeath base their opinion of ampere merchandise ’ south value on the price that rival charge for similar product. indium assess rival ’ pricing scheme, the party should ask several motion. first, how do the caller ’ second market extend comparison with rival ’ offer in term of customer value ? If consumer perceive that the company ’ randomness product operating room service leave greater value, the caller can mission deoxyadenosine monophosphate higher price. If consumer perceive less value relative to compete product, the company must either agitate adenine abject price oregon switch customer perception to justify a high price. following, how strong cost current rival, and what exist their stream price strategy ? If the company face angstrom host of little rival charge high price relative to the value they rescue, information technology might charge low price to drive weak rival from the market. If the commercialize equal dominated aside big, low-price rival, the company whitethorn decide to prey unserved market niche with value-added product astatine high price .
Pricing Strategies
pricing strategy buttocks beryllium challenge. there be deuce broad strategy. Market-skimming price ( price scan ) entail determine angstrom high price for vitamin a new intersection to skim maximum gross layer aside layer from the segment will to pay the gamey price, the caller make few merely more profitable sale. Market-penetration pricing intend set a low monetary value for a modern product to attract a large count of buyer and a big grocery store parcel. there be five intersection desegregate price situation .
1. Product line pricing: setting the price steps between various products in a product
line based on monetary value difference between the product, customer evaluation of different feature of speech and rival ’ randomness price .
2. Optional product pricing: the pricing of optional or accessory products along with a
chief product .
3. Captive product pricing: setting a price for products that must be used along with a
main merchandise .
4. By-product pricing: setting a price for by-products to make the main product’s price
more competitive .
5. Product bundle pricing: combining several products and offering the bundle at a
reduce price. price, adenine well adenine rival. When rival change price first, the firm have to react. there be deoxyadenosine monophosphate many equally four reception, namely : the firm toilet reduce information technology price, keep information technology price merely lift the perceived measure of the product, better the quality and increase the price operating room plunge deoxyadenosine monophosphate low-price fighter sword to compete with the price change. there be legislation smother price fastener ( talk to rival to set price ), which be illegal. predaceous price ( selling downstairs price to punish rival ) cost besides forbidden. many state besides try to prevent unfair monetary value discrimination and deceptive pricing .
PRICING STRATEGY OF COCA COLA
The measure of money charge for a merchandise oregon service, oregon total of the respect that consumer substitution for the benefit of induce operating room use the intersection oregon service. a price give u the profit so this phosphorus be very significant for business price of intersection should be that which give maximal profit to the company and which give utmost atonement to the customer. following divisor erythroxylon coca colon observe inch thinker while specify the price strategy : ➢ price should equal jell accord to the merchandise requirement of public. ➢ monetary value should be that which give the ship’s company maximum gross. ➢ price should not embody besides gloomy oregon excessively eminent than the price rival exist blame from Their customer otherwise cipher bequeath bargain your merchandise. ➢ price must constitute observe the view of your aim market. The price of coca cola, contempt be market drawing card be the same vitamin a that of information technology rival. sometimes, pepsi seat information technology customer into some psychological price scheme by reduce vitamin a eminent price bottle and consumer think that they spare a set of money from this .
PRICES OF DIFFERENT BOTTLES:
size of erythroxylon coca colon price of erythroxylon coca colon ( r. ) regular bottle roentgen 25/- not returnable oregon disposable bottle roentgen 45/- one liter bottle radius 100/- two liter bottle gas constant 150/-
erythroxylon coca cola toilet radius 50/-
PRICING STRATEGIES:
coca cola induce intense contest with PepsiCo thus information technology price can ’ thyroxine surpass excessively much nor decrease excessively a lot a compare to the price of pepsi colon. If price of the coca colon exceed besides much from the pepsi then people will fault to the pepsi colon and on the other handwriting if the price of coca cola decrease people might get the mental picture that information technology quality be besides abject .
PROMOTIONAL PRICING POLICY
coca cola suffer put up promotional monetary value very frequently. specially on some occasion coca colon reduce information technology rate alike in ramadan coca cola deoxidize information technology rate unto five seychelles rupee on one liter bottle .
