Assignment:
Prepare a 1,400-1,750-word paper in which you describe market trends that your selected organization/industry will face. Explain your conclusions. In your paper address how each of the following will change or will not change, and why:
Intro:
a. Market structure
b. Impact of new companies entering the market
c. Prices
d. Technology
e. Productivity (consider the law of diminishing marginal productivity)
f. Cost structure
1) Wages and benefits
2) Fixed and variable costs
g. Price elasticity of demand
h. Competitors
i. Supply and demand analysis
j. Impact of government regulations
Market Trends: Coca-Cola Company
Market Structure:
Since Coca Cola exist in a duopoly type oligopoly market changes in current market trend can be managed between the market leaders as to ensure market success. With Coca Cola being the most widely sold and distributed carbonated drink throughout the world, sales and marketing trends of the product can be analyzed and operations can be reformatted to meet the current trends. Since 2008, Coca Cola has increased their worldwide unit case volume by five percent for the year which has led to continue growth in unit case volume for products sold around the world. The increase of case volume sold has impacted global gains in volume and value share towards the overall growth that is in line with the firm’s long-term revenue and profit goals. With the current economic environment the trend with consumers consuming carbonated beverages has increased which has led to financial success of the company.
Impact of new companies entering the market
“By 2012, it's estimated that an average 84.5 liters of soft drinks will be consumed per person per year globally, with consumption rates in the global health and wellness drinks market rising rapidly. (Bharat Book Bureau, 2007 )” To compete against Coca Cola and Pepsi Company in the duopoly market structure, any new company entering the market will have to excel in products that are healthier then soft drinks and reports overall wellness with consumer consumption. For Coca-Cola to maintain market share against new competitors entering the market the company must ensure products such as drinks like Vitamin water meets the requirement of consumer with taste and health to compete in a more heath driven society.
Prices
The market trends and people are forever changing is it important for businesses to know what, when, where those changes take place. Featherstone, K.(2009) states “ In today’s economy, where we find that shoppers are more fickle than ever, its increasingly important for manufacturers and retailers to have access to the right insights in order to build, more shopper- centric solutions” (p.1). As market trends continue to change, businesses must adapt to these changes in order to compete and survive in the market industry. One of the main reasons the Coca- Cola Company has dominated the soft drink industry and has upheld its repetition as the Beverage King is because of its ability to keep up with the changing market trends of the consumers. It has strived and succeeded in maintaining quality service to its consumers as well as developing tasty and healthy products.
Technology:
Though the changes of new technology the Coca- Cola Company has created many technological innovations in the marketplace. Checkout. (2008) states “the 2008 Top 100 suggests that for all the changes in the marketplace, more has stayed the same than changed. The big brands - Coca-Cola, Jacob's, Avonmore, Lucozade, Denny et al- remain firmly ensconced in the top ranks of the Top 100, with the same names remaining consistent though out the years” (p.42). Even though Coca – Cola Company has been successful in marketing its soft drinks it has shifted its market strategies in other directions such as in the noncarbonated products. For instance, to compete against PepsiCo energy drink Amp and Red Bull GmbH’s Red Bull; Coca- Cola has launched the energy drink Monster. However, to make its product more marketable Coca-Cola has created a 3oz energy shot size. Hein, K. (2009) states “Monster, which helped reinvent the category by rolling out the larger size can, is hoping to do it again. Only this time it is looking to go smaller by focusing on a 3-oz energy shot” (p.7). Its success in profits and technology has kept its product prices competitive with its competitors. As part of Coca- Cola market strategy the company is constantly seeking new ideas and developing new products to satisfy the changing taste of consumers. Though out the changes of technology the Coca- Cola Company has continued to change with the market trends in which it has kept it as the top competitor in the beverage industry.
Productivity:
Coca-Cola offers a market of one of the largest widely distributed products for beverages, which reaching across the globe. Coca-Cola’s market trends are so popular that it contributes in the market of approximately 3 million people and offers over 3,000 varieties of flavored drinks keeping with the market trends. Production system includes, soda, water, juice, tea and sport drinks. Productivity includes the system with fixed and variable inputs, including the manufacturing the branding, the bottling operation, marketing activities, which include the television commercials, online programs, retails store displays, sponsorships and of course one of the most important is the packaging. These market trends change with time as the changing needs, and desires of the consumers change. Productivity meets the desires and roles of the contribution of that produces the output of one of the largest, yet ever-changing beverage company-Coca-Cola.
Wages and benefits:
Fixed and variable costs:
Price elasticity of demand:
Market trends impact many parts of an organization. It is important that Coca-Cola’s Corporation addressing the price elasticity of demand, and how consumers react based on certain trends. Coca-cola’s corporation makes important decisions as to if it will impact the company and its market trends.
Pepsi and Coca-Cola have always been two dominant competitors who thrive for market power. Analyzing the pricing patterns and trends in the market, Coca-Cola attempts the dominance through different measures such as advertising strategies, factoring price affects, reviewing income changes in consumer, and sensitivity to price as compared to the market trends with competitors.
Competitors
Supply and demand analysis
Impact of government regulations
References:
Bharat Book Bureau. (2007). Global market review of functional health soft drinks-forecasts to 2012. Retrieved August 2, 2009, from https://www.bharatbook.com/Market-Research-Reports/Global-market-review-of-functional-health-soft-drinks-%E2%80%93-forecasts-to-2012.html
Featherston, K. (2009). The Last Mile of Marketing. Adweek, 50(18), 1.
Hein, K. (2009). Monster Goes Small While Amp Goes Big.Brandweek. 50(7), 7.
Checkout. (2008). Top of the Charts. Checkout, 34(8), 42-85.