Bcg Matrix For Coca Cola

AssignmentPrinciples Of ManagementSubmitted to Mr. Ghulam Ahmad Rana ByWajid AliRoll No.3335MBA 1st Semester

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Assignment Principles Of Management Submitted to lớn Mr. Ghulam Ahmad Rana By Wajid Ali Roll No.3335 MBA 1st Semester 1 Page Assignment Principles of Management Boston Consulting Group Matrix (BCG) on Coca-Cola. Introduction of Coca-Cola: Coca-Cola (also known as Coke) is a popular carbonated soft drink sold in stores, restaurants & vending machines in over two hundred countries. It is produced by The CocaCola Company, which is also occasionally referred to lớn as Coca-Cola or Coke. It is one of the world’s most recognizable and widely sold commercial brands. Coke"s major rival is Pepsi. Although Coke has been the target of urban legends decrying the drink for its supposedly copious amounts of “acid”, or the "life-threatening" effects of its carbonated water but still it is the most in-style soft drink. About its safety và the ethics of the company that produces it, it is widely accepted as the most dominant soft drink in the world today. Originally intended as a patent medicine when it was invented in the late 19th century, Coca-Cola was bought out by shrewd businessman Asa Griggs Candler, whose aggressive marketing tactics led Coke to lớn its dominance of the world soft drink market throughout the 20th century. Although faced with accusations of perverse side-effects on the health of consumers and monopolistic practices by its producing company, Coca- Cola has remained a popular soft drink well into the first decade of the 21st century. Mission Statement: Our Roadmap starts with our mission, which is enduring. It declares our purpose as a company & serves as the standard against which we weigh our actions và decisions. • to refresh the world. • to lớn inspire moments of optimism and happiness • khổng lồ create value and make a difference BCG Growth Matrix Analysis The BCG matrix approach is based on the product life cycle concepts which can be utilized to identify what priorities should be given in the product portfolio of a business level. Lớn make sure that the company is creating long-term value, an industry should have a portfolio of products which contains both high-growth products in need of cash inputs as well as low-growth products which establishes a lot of profit or cash. BCG matrix relies on 2 dimensions: market growth và market share. The basic notion behind it is that the higher the market nội dung of a specific hàng hóa has or the faster the product’s marketability grows, the better it is for the industry. Placing appropriate products in the BCG matrix, results in 4 categories, in the business portfolio of an industry. The four categories include the Stars, cash cows, dogs, question marks. 2 Page Assignment Principles of Management STARS: HIGH GROWTH, HIGH MARKET mô tả • Stars are leaders in business. • They require heavy investment khổng lồ maintain its large market share. • It leads to lớn a large amount of cash consumption & cash generation. • Attempts should be made khổng lồ hold the market chia sẻ otherwise the star will become a cash cow. The star products of Coca-Cola are Thumbs up, Maaza, Kinley CASH COWS: LOW GROWTH, HIGH MARKET mô tả • They are foundation of the company and often the stars of yesterday. • They generate more cash than required. • They extract the profits by investing as little cash as possible. • They are located in an industry that is mature, not growing or declining. The products which are Cash cows are Limca, Coca Cola QUESTION MARKS: 3 Page Assignment Principles of Management HIGH GROWTH, LOW MARKET nội dung • Most businesses start of as question marks. • They will absorb great amounts of cash if the market mô tả remains unchanged • Question marks have potential to lớn become star và eventually cash cow but can also become a dog. • Investments should be high for question marks. The question marked products of Coca-Cola are Fanta, sprite DOGS: LOW GROWTH, LOW MARKET nội dung • Dogs are the cash traps. • Dogs vày not have potential to bring in much cash. • Business is situated at a declining stage. The products which are at Dogs are Diet Coke, Minute maid Conclusion • Star Strategy: Invest profits for future growth và for earning more of market share & profits. • Cash Cow Strategy: Use profits khổng lồ finance new products và growth elsewhere. • Question Mark Strategy: Either invest heavily in order lớn push the products lớn star status, or divest in order to lớn avoid it becoming a Dog. • Dog Strategy: Either invest lớn earn market tóm tắt or consider disinvesting. Thus the BCG matrix is the best way for a business portfolio analysis. The strategies recommended after BCG analysis help the firm decide on the right line of kích hoạt and help them implement the same. Porter’s Five Forces Model: Sample Analysis of Coca-Cola Since its introduction in 1979, Michael Porter’s Five Forces has become the de facto framework for industry analysis. The five forces measure the competitiveness of the market deriving its attractiveness. The analyst uses conclusions derived from the analysis khổng lồ determine the company’s risk from in its industry (current or potential). The five forces are (1) Threat of New Entrants, (2) Threat of Substitute Products or Services, (3) Bargaining power nguồn of Buyers, (4) Bargaining power of Suppliers, (5) Competitive Rivalry Among Existing Firms. The following is a Five Forces analysis of The Coca-Cola Company in relationship khổng lồ its CocaCola brand. 4 Page Assignment Principles of Management Threat of New Entrants/Potential Competitors: Median Pressure   Entry barriers are relatively low for beverage industry: there is almost 0 consumer switching cost & very low capital requirement. There are more và more new brands appearing in the market with usually lower price than Coke products However Coca-Cola is seen not only as a beverage but also as a brand. It has a very significant market nói qua for a long time and loyal customers are not very likely to lớn try a new brand beverage. Threat of Substitute Products: Median lớn high pressure  There are many kinds of energy drink và soda products in the market. Coca-cola doesn’t really have a special flavor. In a blind taste test, people couldn’t tell the difference between Coca-Cola coke và Pepsi coke. The Bargaining power nguồn of Buyers: Low pressure       The individual buyer has little lớn no pressure on Coca-Cola The main competitor, Pepsi is priced almost the same as Coca-Cola. Consumer could buy those new and less popular beverages with lower price but the flavor is different & the quality is not guaranteed. Large retailers, like Wal-Mart, have bargaining power nguồn because of the large order quantity, but the bargaining nguồn is lessened because of the kết thúc consumer brand loyalty. There are many kinds of energy drink and soda products in the market. Coca-cola doesn’t really have a special flavor. In a blind taste test, people couldn’t tell the difference between Coca-Cola coke và Pepsi coke. People are getting concerns of negative effects of carbonated beverages. Increasing number of consumers begin khổng lồ drink fruit juice, lemonade and tea instead of soda products. 5 Page Assignment Principles of Management The Bargaining power nguồn of Suppliers: Low pressure   The main ingredients for soft drink include carbonated water, phosphoric acid, sweetener, & caffeine. The suppliers are not concentrated or differentiated. Any supplier would not want to lose a huge customer like Coca-Cola. Rivalry Among Existing Firms: High Pressure   Currently, the main competitor is Pepsi which also has a wide range of beverage products under its brand. Both Coca-Cola and Pepsi are the predominant carbonated beverages và commit heavily lớn sponsoring outdoor festivals and activities. As Coca-Cola has a longer history, it is advertised in a more classical approach while Pepsi tried to lớn attract younger generation by using pop stars as brand ambassadors. Currently Coca-Cola slightly topped Pepsi as the possessor of the most U.S market share. There are other soda brands in the market that become popular, lượt thích Dr. Pepper, because of their chất lượng flavors. PORTER’S GENERIC STRATEGIES Michael Porter is a professor in the Harvard Business School & also the president of the Institute for Strategy & Competitiveness. His simple diagram of competitive strategy became very popular in the 1980s, and it is even more popular in today’s competitive world. They outline the three main strategic options xuất hiện to organization that wish khổng lồ achieve a sustainable competitive advantage. Each of the three options is considered within the context of two aspects of the competitive environment: Sources of competitive advantage - are the products differentiated in any way, or are they the lowest cost producer in an industry? Competitive scope of the market - does the company target a wide market, or does it focus on a very narrow, niche market? The generic strategies are: 1. Cost leadership, 2. Differentiation, and 3. Focus. 6 Page Assignment Principles of Management Strategy adopted by Coca-Cola: Altough this company’ products does not have a lower cost compared khổng lồ other companies, this uses another strategy from the Porter’s Diagram, which is Differentiation. Branding is what makes people to lớn recognize the products of this company. The hand writing of Coca Cola is of the brilliantly chosen logo. Wajid Ali 7 Page Assignment Principles of Management