coca-cola-swot-analysis

Coca-Cola SWOT Analysis In A Nutshell

Coca-Cola is the market leader in the soft drink industry. It is also the most widely recognized brand, with a Business Insider study revealing that a staggering 94% of the world population recognizes the red and white logo. However, Coca-Cola faces significant challenges with increasingly health-conscious consumers and less access to water resources.

This SWOT analysis will detail how the company might navigate this uncertain future.

Strengths

  1. High brand equity – in a market dominated by products that look largely the same, Coca-Cola enjoys high brand equity. In 2011, it won Interbrand’s highest brand equity award. More recently, it won the 2019 Effie Index award for the most effective global brand.
  2. Global presence – the Coca-Cola Company has either a product or manufacturing presence in most of the world’s 196 countries. It is the most widely distributed North American product, eclipsing the likes of McDonald’s and Subway.
  3. Economies of scale – of the 60 billion beverages served worldwide every day, Coca-Cola serves 3.2% or 1.9 billion of them. This allows the company to spread its costs over billions of servings across hundreds of brands, making each drink extremely cheap to produce.
  4. Diversified product portfolio – while many associate Coca-Cola with soft drink, the company also owns and distributes over 500 different beverages in markets such as bottled water, fruit juice, sports drinks, and tea and coffee.

Weaknesses

  1. Competition – as successful as Coca-Cola has been, PepsiCo enjoys a similar market share and brand equity. The two companies have been involved in several acrimonious disputes over the years, resulting in negative press and a decrease in brand equity for each.
  2. Soft-drink reliance – although highly diversified, Coca-Cola still relies on soft drinks to drive most of its sales. In fact, sales of “Coke” accounted for 78% of total revenue. This reliance may drive profits down as consumers shift to healthier beverages.
  3. Water management – beverage-centric companies such as Coca-Cola are heavily reliant on water as the main ingredient in their products. Water security and water quality are contentious issues, particularly in the third world. Thus, the company may face challenges in securing enough water to meet demand.

Opportunities

  1. Diversification – with a clear shift away from carbonated drinks, Cola-Cola needs to diversify to maintain revenue. The company has invested heavily in Keurig Green Mountain, a coffee brand, and energy drink Monster. Developing countries with a need for clean drinking water as well as tea and coffee also represent an opportunity for Coca-Cola to diversify.
  2. Supply chain improvement – as a global brand, Coca-Cola’s supply chain is subject to increased transportation and distribution costs. The company has the opportunity to leverage existing soft drink networks to instead move products with a higher profit margin.
  3. Sustainability – as one of the largest manufactures of beverages, Coca-Cola has to accept some responsibility for the pollution arising from single-use plastics. There is scope for Coca-Cola to position themselves as environmentally friendly with innovative, recyclable packaging.

Threats

  1. Competition – as Coca-Cola focuses on distribution and brand visibility, its main competitor PepsiCo is prioritizing an eCommerce presence with a focus on premium products. There is the potential that Coca-Cola has a competitive disadvantage as consumer buying preferences change.
  2. Regulation – healthcare professionals are becoming more vocal about the dangers of sugar-laden drinks and their potential to cause diabetes and heart disease. This, in turn, has led to discussions in government about the introduction of sugar taxes on the soft drinks which are a staple of Coca-Cola’s product range.
  3. Modernization – because of Coca-Cola’s global footprint, they are more susceptible to economic changes in developing countries. In such countries, employees are demanding higher rates of pay as others leave to chase better pay elsewhere. This leaves Coca-Cola understaffed and vulnerable to productivity loss. To some extent, Coca-Cola is also reliant on favorable exchange rates and the cheap and plentiful supply of raw materials to make a profit.

Coca-Cola’s real secret formula? Distribution!

coca-cola-business-strategy
Coca-Cola follows a business strategy (implemented since 2006) where through its operating arm – the Bottling Investment Group – it invests initially in bottling partners’ operations. As they take off, Coca-Cola divests its equity stakes, and it establishes a franchising model, as long-term growth and distribution strategy.
what-does-coca-cola-own
The Coca-Cola Company is an American multinational beverage corporation founded in 1892 by pharmacist Asa Griggs Candler. Many consumers associate the company with its signature soda in a red can or bottle. In truth, however, The Coca-Cola Company owns a plethora of soft drink, juice, tea, coffee, and other beverage brands. 
coca-cola-vision-statement-mission-statement
Coca-Cola’s Purpose is to “refresh the world. make a difference.” Its vision and mission are to “craft the brands and choice of drinks that people love, to refresh them in body & spirit. And done in ways that create a more sustainable business and better-shared future that makes a difference in people’s lives, communities, and our planet.”
coca-cola-competitors
The Coca-Cola Company has 21 different billion-dollar brands or brands that generate more than $1 billion or more in revenue each year.  The company also sells its products in nearly every country in the world, with Cuba and North Korea the only two countries where it is not sold officially. What’s more, the Coca-Cola brand is worth $87.6 billion, making it one of the most valuable among all companies. Though these figures allow Coca-Cola to enjoy market dominance in many countries, the company is nevertheless subject to intense competition.

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Samsung SWOT Analysis

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Samsung was founded in South Korea in 1938 by Lee Byung-Chul. Originally a trading company, it took Samsung 22 years to become the fully-fledged electronics company that most people recognize today. Indeed, the company is a leader in technological innovation through telecommunications, electronics, and home appliances.

Costco SWOT Analysis

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Costco is a large American multinational corporation with a focus on low-cost, membership-only retail warehouse clubs. Costco is the 4th largest retail operator in the world, operating 785 warehouses in 10 different countries. Indeed, it has enjoyed rapid success growing from zero to $3 billion in sales within six years.

Walmart SWOT Analysis

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From humble beginnings just over 50 years ago, Walmart has grown to become the world’s largest retail company. A single small discount store in Arkansas has now expanded to over 11,000 stores in 28 countries. Some reports suggest that the company now makes $1.8 million of profit every hour.

Uber SWOT Analysis

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Disney SWOT Analysis

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It would be hard to argue the case for a more recognizable entertainment brand than Disney. Disney is of course synonymous with Walt Disney, but it was Walt and his brother Roy who started the company in 1923 in Burbank, California. Disney content is now broadcast on over 100 channels in 34 different languages across the globe.

Coca-Cola SWOT Analysis

coca-cola-swot-analysis
Coca-Cola is the market leader of the soft drink industry. It is also the most widely recognized brand, with a Business Insider study revealing that a staggering 94% of the world population recognizes the red and white logo. However, Coca-Cola faces significant challenges with increasingly health-conscious consumers and less access to water resources.

Ford SWOT Analysis

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Founded in 1903 by Henry Ford and is the fifth-largest family-owned company in the world. Ford is a globally recognized brand in the automotive industry for a couple of reasons. First, Henry Ford is well-known as the inventor of the production line and thus the modern automobile industry. Today, Ford has also maintained relevance as the seventh-largest car manufacturer worldwide, selling a range of passenger cars, trucks, and vans.

Tesco SWOT Analysis

tesco-swot-analysis
Tesco was founded in 1919 by Jack Cohen, as a small group of market stalls. After rapid expansion in the following years, the company became the largest retailer in the UK and is now the second-largest in the world. To put their dominance into perspective, consider that Tesco serves around 66 shoppers per second across 7000 retails stores, delivering approximately $180,000 worth of sales every minute.

Nestlé SWOT Analysis

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Nestlé is a large multinational food and beverage manufacturer with more than 2000 brands spread across 197 countries. Some of Nestlé’s well-known brands include Nescafe, Kit-Kat, Purina, Aero, Butterfinger, Maggi, and Haagen-Dazs. Originally a producer of infant food in 1867, it is now considered to be the world’s largest food manufacturer.

Amazon SWOT Analysis

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Amazon is among the most diversified business model in the tech industry. The company is well-positioned to dominate e-commerce further. And while its online stores have tight profit margins, Amazon still unlocks cash for growth, while consolidating its dominance in the cloud and grabbing new opportunities like voice.

Facebook SWOT Analysis

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Netflix SWOT Analysis

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Apple SWOT Analysis

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Google SWOT Analysis

google-swot-analysis
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Read Next: SWOT Analysis, Personal SWOT Analysis.

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