The case exemplifies the effective strategy
of marketing independence through creating a second or third level of marketing
subsidiary or franchisee. Through
franchising, Coca Cola International can maximize the knowledge distinctly
evolving inside a certain market segment or geographical region.
The case further mentioned the barriers of
International laws being considered as the common conflicting aspect when it
comes to legal documentations and cross border rights. As such, the international business laws
abided by certain group of countries such as the EU Japan and Asia, and the
Americas must be synchronized in their customs policies to avoid “bottle necks”
across the supply chain.
Coca-Cola on the other hand rely its cost minimization through the
implementation of FDI (Foreign Direct Investments). One incident during the prime time of their
market dominance in Europe, Coca Cola try to abuse their market dominance
through the scheme of giving discounts for commissions around Europe if a given
distributor will solely distribute Coca-Cola products.
The complaint reaches to the Commission of
the European Communities. Furthermore,
as Tariffs within Europe is eliminated due to the EU treaties; Coca-Cola
distributors can gain more profit and marketing dominance across the
region.
Another aspect that coca cola is
doing in Europe to acquire local citizen’s trust and product loyalty is through
the concept of operating their marketing as thinking locally and acting locally
in terms of marketing strategy. As the
event of the case is stating the positive response of the local community in
Europe towards the company, eliminating the popularity of local beverage
products eventually come to reality.
However, the local market operation of coca-cola is successful through
the partnership of a European company Beecham and Grand Metropolitan who also
take over the Cadbury Schweppes in England.
The strong marketing influence of Beecham and Grand Metropolitan in
Europe drives Coca-Cola company more acceptable in the local market.
The migration of Coca-cola further reaches
to other countries in Europe such as Germany, France, Italy, and
Netherlands. The versatility of
coca-cola’s marketing strategy drives its world dominance when it comes to
beverage business.
PROBLEMS:
1 One of the problems of Coca-Cola operating in other countries is the
FDI agreements with partner companies abroad.
Granting that customs laws and protocols drives the industry’s day-to-day
operation, variety of customs practices from different countries will affect
the overall or global marketing system and supply chain.
2 How can Coca-Cola improve their market and PR dominance in Europe.
Given, that Coca-Cola is not a local brand of Europe… customer’s sympathy is
generally towards the local brand offerings of Europe. With this, Coca-Cola marketing and the PR
team together with the Beecham and Grand Metropolitan Company in Europe must
create a Marketing and PR program that can penetrate the local market taste.
3 Local rivalries is also an added problem of Coca-Cola and the local
partner company. Those local companies
who will try to create a rivalry with Coca-Cola will create a PR stance and
image to capture the attention not only to the existing consumers of the local
beverage product but also the international beverages consumers who doesn’t
have any idea of the local product.
4. The credibility of Coca-Cola around the world as the accepted
beverage manufacturing company is always subject to the local performance of
any given local market in the world. As
to the case of Europe, the negative impact of Coca-Cola market performance in
Europe will resonate throughout the International Market.
THEORY:
The combination of the Theory of Porter and the Regional Triad Strategies
and Concepts will answer to the complexity of the market diversity behavior
around the globe in terms of the Coca-Cola Company Case.
Porter’s determinant as a system portrays the
dependence of the visiting company towards the local company moving its
marketing operations in a manner of local approach. As such, modifying the International product
towards the local taste modification applied to the product will add appeal to
coca-cola product sold in the local market.
CONCLUSION:
Considering the theories given and the problem viewed by the writer,
the following solutions towards the problem will answer academically based from
the logical inferences of the writer.
Considering problem 1, FDI problem can be concluded by the application
of Porter’s determinant system and the regional triad concept of integrating
and collaborating marketing activities that will eventually set the subconscious
minds of the general public.
Moreover, problem 2 can also be regulated by applying the concept of
Porter and the Triad integration of International marketing. By domestic clustering of consumer market in
Europe, Coca-Cola can have a focus and precise consumer behavior integration.
However, the local company rivalries will have a fair and equal local
market competition if Coca-Cola will act and think locally applying the
concepts of Porter and the Triad integrations of customs policies and
laws.
Finally, the last problem that can
be covered by the theory of porter and the triad concept is the overall
Coca-Cola International credibility as a globally accepted beverage
manufacturing company. The versatility
of Coca-Cola marketers will prove through the ages that the company’s tested
localized marketing strategy using Porter’s theory and the Triad concepts is inevitable.
REFERENCES:
- Beamish, Paul W. and Calof, Jonathan L. “International Business Education: A Corporate View,” Journal of International Business Studies, vol. 20, no. 3 (Fall 1989).
- Becker, Fred G. “International Business and Governments: Issues and Institutions,”Management International Review, vol. 32, no. 4 (Fourth Quarter 1992).
- Caves, Richard E. “Research on International Business: Problems and Prospects,” Journal of International Business Studies, vol. 29, no. 1 (First Quarter 1998).
- Daniels, John D. “Relevance in International Business Research: A Need for More Linkages,” Journal of International Business Studies, vol. 22, no. 2 (Second Quarter 1991).
- Dunning, John H. “The Study of International Business: A Plea for a More Interdisciplinary Approach,” Journal of International Business Studies, vol. 20, no. 3 (Fall 1989).
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