This Coca Cola SWOT analysis reveals how the company controlling one
of the most iconic brands of all time used its competitive advantages
to become the world’s second largest beverage manufacturer.
It identifies all the key strengths, weaknesses, opportunities and
threats that affect the company the most. If you want to find out more
about the SWOT of Coca Cola, you’re in the right place.
For more information on how to do a SWOT analysis please refer to our article.
Company Background
Name: The Coca-Cola Company
Founded: May 8, 1886
Logo: Coca Cola swot analysis logo
Industries served: Beverage
Geographic areas served Worldwide (more than 200 countries)
Headquarters Atlanta, Georgia, United States
Current CEO: James Quincey
Revenue (US$): 35.410 billion (2017) 15.4% decrease over 41.863 billion (2016)
Profit (US$) : 1.182 billion (2017) 81.9% decrease over 6.527 billion (2016)
Employees: 61,800 (2018)
Main Competitors: PepsiCo Inc., Dr Pepper Snapple Group, Inc.,
Unilever Group, Mondelez International, Inc., Groupe Danone, Kraft
Foods Inc., Nestlé S.A. and many other companies in the beverage
industry.
The Company’s business overview from financial report:
“The Coca-Cola Company is the world’s largest beverage company. It own
or license and market more than 500 nonalcoholic beverage brands,
primarily sparkling beverages but also a variety of still beverages
such as waters, enhanced waters, juices and juice drinks,
ready-to-drink teas and coffees, and energy and sports drinks.
It owns and market four of the world’s top five nonalcoholic sparkling
beverage brands: Coca-Cola, Diet Coke, Fanta and Sprite. Finished
beverage products bearing our trademarks, sold in the United States
since 1886, are now sold in more than 200 countries.
It makes its branded beverage products available to consumers
throughout the world through its network of Company-owned or
-controlled bottling and distribution operations as well as
independent bottling partners, distributors, wholesalers and retailers
— the world’s largest beverage distribution system.
Beverages bearing trademarks owned by or licensed to the company
account for 1.9 billion of the approximately 60 billion beverage
servings of all types consumed worldwide every day.
The Company believes its success depends on the ability to connect
with consumers by providing them with a wide variety of choices to
meet their desires, needs and lifestyle choices. Its success further
depends on the ability of people to execute effectively, every day.
Our goal is to use Company’s assets brands, financial strength,
unrivaled distribution system, global reach, and the talent and strong
commitment of its management and associates — to become more
competitive and to accelerate growth in a manner that creates value
for our share owners.”
SWOT analysis
Strengths
1. Dominant market share in the beverage industry
The Coca-Cola Company is the largest non-alcoholic beverage company in
the world. It serves 1.9 billion or 3.2% of the total 60 billion
beverage servings of all types consumed worldwide every day.[1] The
company owns, distributes and sells over 500 various non-alcoholic
beverage brands in over 200 countries.
Largest beverage companies in the world in 2017 Rank
Name 2017 revenue (in US$ billions) Beverage segment
1 Anheuser-Busch In Bev – 56.444 Alcoholic
2 The Coca-Cola Company – 35.410 Non-alcoholic
3 PepsiCo Inc. 29.857 Non-alcoholic
4 Nestlé S.A. 29.109 Non-alcoholic
5 Suntory Holdings Limited – 22.057 – Alcoholic
6 Heineken N.V. 21.888 – Alcoholic
7 Starbucks Corporation 17.650 – Non-alcoholic
8 Diageo plc 17.078 – Alcoholic
9 Pernod Ricard S.A. 11.132 – Alcoholic
10 Molson Coors Brewing Co. 11.002 – Alcoholic
Only PepsiCo and Nestlé can compare to The Coca-Cola Company’s sheer
size and the market share in the non-alcoholic beverage segment. Being
large and having dominant market share has a few advantages over
competitors:
Economies of scale allow the company to share its fixed costs over
hundreds of brands and billions of servings, making each drink as
cheap as possible.
Market power over suppliers and competitors. Due to its size, The
Coca-Cola Company can exercise its market power over suppliers by
requiring lower prices from them. The company can also use its size to
affect the competition by underpricing some of its items, acquiring
the smaller competitors or saturating the market with many of its own
products.
Power over the buyers.
Unlike some of its smaller competitors, the Coca-Cola brand and the
company’s other signature drinks have an enormous brand recognition
all over the world. The company can influence consumers’ buying
decisions through its brand power and massive marketing campaigns more
easily than most of its smaller rivals.
Wide audience reach. The Coca-Cola Company’s distribution network
allows the chain to reach more customers than most of its rivals could
reach. According to the company, the company serves 1.9 billion
servings a day, more than any other competitor in the world.
Wide audience reach does not only help the company to target more
customers and increase brand awareness, but also to introduce new
products more easily.
2. Diversified product portfolio with 21 billion-dollar brand
The Coca-Cola Company owns and distributes over 500 different brands,
which is the most extensive beverage brand portfolio in the whole
industry. The company offers beverages for every taste in 7 beverage
categories:
Carbonated Soft Drinks; Bottled Water; Juice & Juice Drinks; Sports
Drinks; Tea & Coffee; Energy Drinks & Shots; Alternative Drinks.
The Coca-Cola Company’s and its rivals beverage rband portfolios.
Coca-Cola owns 648 brands, PepsiCo owns 56 brands, Dr Pepple Snapple
Group owns 62 brands and Nestle owns 10 brands.
The most popular company’s drink is Coca-Cola. Coca-Cola trademark
(includes Diet Coke and Coca-Cola Zero) earned around 40% of the
company’s total revenue.[1] While Coca-Cola is the most important
product, it is only one of the 21 billion-dollar brands that the
business owns. The company’s billion-dollar brands include:
The company also owns 13 other brands that each annually earn at least
US$1 billion:[6]
Coca-Cola; Fanta; Sprite; Diet Coke/Coca-Cola Light; Coca-Cola Zero;
Minute Maid; Georgia Coffee; Powerade; Del Valle; Schweppes; Aquarius;
Minute Maid Pulpy; Dasani; Simply; Vitaminwater; Gold Peak; Fuze Tea;
Ice Dew; Smartwater; I LOHAS; Ayataka.
No other business in the beverage industry owns as many billion-dollar
brands as The Coca-Cola Company.
What does a diversified portfolio provide for the company? First, The
Coca Cola Company depends less on one or two of its beverages to
generate the majority of its revenue.
Second, with so many beverage drinks in so many flavors, the business
can satisfy every consumer’s needs and tastes.
Third, if the demand for one of the company’s beverages falls sharply
(as it is now with Coca-Cola) the business can rely on other beverages
to generate higher sales.
Few of The Coca Cola Company’s rivals can enjoy such a diversified
brand portfolio, which provides strong competitive advantage over the
rivals.
