marketing management - coke

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A Project ReportA Project Report

On

MARKETINGMARKETINGMANAGEMENTMANAGEMENT

OFOF

SUBMITTED BY:

ARCHIT SHANKAR

74/BBA/JIMSG/2000

BBA (H) - SEMESTER VII


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Coca Cola

JAGANNATH INTERNATIONAL MANAGEMENTSCHOOL

Associated Beverages Pvt. Ltd.2


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CONTENTS

TOPICS PAGES

Chapter One Introduction1.1 Background and History of the Coca Cola

System

5

1.1.1 Coca Cola in India 101.1.2 Present profile of Coca Cola and its future

plans in India

11

1.1.3 The 3 As Strategy 141.1.4 The Manufacturing Process of Coca Cola

Brands

15

1.1.5 Objectives of the Project 171.1.6 Need of the Project and its Significance 181.1.7 Scope of the Project - Extent and Limitations 20Chapter Two Research Methodology2.1 Research Design 212.2 Data Collection Sources 212.3 Data Collection Methods and Instruments 222.4 Sampling Plan 24Chapter Three Findings and Analysis3.1.1 Findings from Questionnaire 263.1.2 General Findings from the Market 33

3.1.3 Analysis 36Chapter Four Conclusions and

Recommendations4.1 Conclusions4.2 Recommendations 40

BibliographyAppendixQuestionnaire for Consumers of Soft Drinks 42Slogans Used to Advertise Coca Cola over the Years 45



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Fun-facts 46LIST OF TABLES AND GRAPHS

TablesField Work Schedule

Favourite Soft Drink according to Age Group and

GenderCoca Colas Bottling Plants All over IndiaGraphsFavourite Soft DrinkFavourite Soft Drink according to Age Group and

GenderMost Preferred form of PackagingSecond Favourite Soft DrinkAdvertisements Play a Major Role in the Buying

ProcessSales (in cases) in 2001 2002

ACKNOWLEDGMENT

I would like to acknowledge my sincere thanks to Prof. A.K Sengupta and

Commander Sethand feel highly obliged to them for their expert guidance.



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I would also like to extend my heartfelt gratitude towards the helpful staff at Coca-

Cola India.

Through this project I have not only come across with the complexities of the

corporate world but also realized that how smartly these people work. Working for

this project has familiarized me with how the market works and the inherent

importance of advertising and research.

The project was a great source of learning and value addition for me. It has

opened me to the world of realities.

ARCHIT SHANKAR

Jagannath International Management School

Guru Govind Singh Indraprastha University



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1.1 BACKGROUND AND HISTORY OF THE COCA COLA

SYSTEM:

Coca Cola stands today as the second most widely understood term in

the world after Okay. ( Richard Tedlow, New and Improved : The

Story of Mass marketing in America). The Coca-Cola Company has

come a long way since Dr. John Styth Pemberton invented it in 1886 to

being the worlds most recognised brand. It was Mr. Robert W.

Woodruff, as president of the Coca-Cola Company, who brought Coca-

Cola to the international market, He had set three goals for the

company viz.,

Trained Personnel

Customer Service

Quality Product.

Even after 80 years these three goals are still part of the formula for

success. Mr. Robert W. Woodruff also had a vision i.e. To place Coca

Cola within an arms reach of desire. This literally means to make

Coca-Cola products available to consumers whenever and wherever

they might desire a drink.



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The Coca-Cola company is a truly global beverage company in the

sense that it advertises in more than 650 dialects, conducts business in

46 currencies and pays taxes to more than 195 national governments.

Coca-Cola has even been on the moon!

The Coca Cola Company is organised into two business sector:

The International Business Sector

The North American Business sector.

The International Business Sector is divided into four groups:

The Africa Groups

The Greater Europe Group

The Latin America Group

The Middle and Far East Group

Coca-Cola India comes under the Middle and Far East Group. Each

group within the International Business sector has its unique challenges

and opportunities. While business may seem different in the different

regions, the same basic rules for achievement apply. Quality products,

superior customer service and aggressive marketing hold the key to

success.

The core competence of the Coca-Cola company lies in the basic

understanding of the properties of thirst. They believe that there are

5.8 billion people in the world, and each and every person gets thirsty



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for one time or the other. Each and every time they do, Coca-Cola has

an opportunity. It stands to fulfill the unquenchable desire of different

people all over the world and in doing so, translate thirst into tangible

results.

But how did Coca-cola achieve such great heights with such a simple

philosophy? This question can be best answered by the five enduring

realities. They are as follows:

They sell a universal product that meets a fundamental human

need: They sell a product with physical attributes that the human

palate enjoys, cutting across all barriers of culture, gender, age,

race and religion. Coca-Cola is associated with food, fun and

conversation which help create an atmosphere in which people

take a break and socializes. The average human body requires at

least 64 ounce of liquid everyday just to survive and Coca-Cola

accounts for not even 2 ounces. For every person on this planet

consuming 64 ounces is not an option, but choosing where these

come from, is

They are rapidly strengthening the worlds strongest brand:

By brand strength, Coca-Cola means the brands ability to deliver

value in the market place; to inspire people to pay more for it.



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Pushing relentlessly for building relevant value into Coca-Cola are

the three Ps...................

Pervasive penetration in the market place

Price Relative to value

Preferred beverage everywhere

Their financial fundamentals are superior and reliable:

Three factors contribute to their ability to generate superior cash flow.

First, their capital requirements are very low for a business of their

size. Secondly, their business is not at all labour intensive; they

employ just 32,000 people worldwide. And third, unlike products

such as wine, Coca-Cola can go from production to consumption in

a matter of hours.

Coca Cola provides value to everyone who touches:

Coca Cola believes that everybody should get value from it-the bottling

partners, customers and ultimately people who buy and drink their

product. They strive very hard to ensure that they are different.

They do this in four ways - one, by investing heavily to ensure that

the Coca Cola is always within easy reach, virtually anywhere in

the world; two, by offering consumers a wide variety of packaging

choices; three, by consistently delivering beverages of the highest



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quality; and four, by linking the brand with one-of-a- kind events

and activities, such as the Olympic games, World Cup Cricket

(1996) etc.



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They know how to find opportunity other cannot see :

People at Coca Cola, whenever they walk into an environment, do

not see Coca Cola; they see where Coca Cola is not. They see an

infinite universe and they see those 64 ounces of opportunity.



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1.1.2COCA COLA IN INDIA:

Coca Cola returned to India on the 24th October, 1993 after 16 years of

absence. The city of Agra, the home of the Taj Mahal and for many the

most enduring image of India, was chosen as the symbolic location for

the re-launch.

In India almost 96% of the soft drinks market is controlled by Coca Cola

and Pepsi. Coca Cola has a share of 47.8% and Pepsi 47.3% of the

Rs. 3,000 crore Indian soft drinks market. Between Coke and Pepsi

Rs. 120 crore is spent annually on advertisements and promotions.



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1.1.3PRESENT PROFILE OF COCA COLA AND ITS FUTURE

PLANS IN INDIA:

Coca-Cola claims to have sold 60 million cases of its products between

1st January and 31st May which is a 30% jump in volumes over the

same period last year. Individually also Coca Cola has grown by 48%,

Thums Up has gone up by 33%, Limca has risen by 23%, and Fanta

volumes have swelled by an unbelievable 70%. On the other hand the

rival Cola giant Pepsi has grown by an impressive 42%. At this pace

Coca Cola hopes to close the year with around 128 million cases while

Pepsi hopes to do 105 million cases.

Also an ORG - MARG survey conducted for Coca-Cola shows that the

top - of - the - mind awareness gap between Pepsi and Coke is

narrowing down every month. In August, 2002, only 19.4% of a sample

soft drinks consumer population recalled seeing a coke advertisement

while 37% remembered Pepsi instantly. By November, the same year

the figures were - 21.6% were aware of Coke and 33.7% knew about

Pepsi, In March 1998, the gap had filled further with 32% aware of

Pepsi and 30.4% appraised of Coke.



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Between 1993, when Coca Cola acquired the Parle Soft Drinks

Division, and 1997, its overall market share had dropped from a

comfortable 69% to 51% while Pepsi zoomed from a paltry 17% to 40%

during the same period. Pepsis gains came from market growth and a

large chunk of it was at the expense of Coke.

In India Coca Cola has an established bottling infrastructure comprising

of 52 bottling plants and a portfolio of eight strong brands. Each of

these brands has a character of its own. Thumbs Up has the macho

image targeted towards the 20-29 year olds; Fanta is the fun drink the

first love of 13-19 year olds and Limca has the take it easy image. The

brands Coca Cola, Thums Up, Limca and Fanta have been identified as

national brands in India.

Coca Cola is now planning to set up four down stream bottling

companies and the franchisee bottler is being given two options to

either join hands or sell out . Of the 52 bottlers in India only 12 have

formed joint ventures so far and that two mainly in the south. Another

ten bottlers are sitting on the fence.

The backbone of success of Coca-Cola has been the bottler, the

franchisee in partnership and the local operating unit of the Coca-Cola

system.



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The Coca Cola company works with bottler partners all around the

world to create effective operating units at the local levels. The ties that

bottlers have with local customers, consumers, governments, banks,

entrepreneurs, charities and sports organisation are critical to the

success of the Coca Cola system.



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1.1.4THE 3 AS STRATEGY

The 3 As, namely, availability, affordability and acceptability has itsfocus on the customers and consumers. It is basically a strategy to

reach increasing number of consumers.

Availability : The main challenge of Coca Cola is to place its

products within an arms reach of desire. This it

plans to do with improved or innovative new

packaging, dispensing systems, distributionsystems and marketing programs.

Affordability : Coca Cola addresses this aspect by making the

products available at a price affordable to the

consumer. This is done by continually focussing on

making the production and distribution system more

efficient and cost effective.

Acceptability : Acceptability requires the product to be of the

highest quality. Also acceptability can be effected

through advertising, sponsorships, promotions

community programs etc.



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1.1.5THE MANUFACTURING PROCESS OF COCA COLA

BRANDS

Coca Cola products reach the consumer through a variety of different

beverage systems, including bottles, cans and fountain drinks. The

exact steps in the process differ depending on the beverage system

used.

For the bottle or can beverage system, the ingredients are pre-mixed

and the beverage is ready to drink. This beverage system includes

returnable glass bottles of 300 ml (RGB) and cans. The glass bottles

are cleaned and rinsed.

The fountain beverage system is also called the post-mix beverage

system. It involves dispensing systems where syrup and carbonated

water are mixed together. The syrup for post-mix is store in stainless

steel tanks or Bag-in- Box containers in a near by storage area and

piped to the dispensing system. A carbonator is located in the

dispenser cabinet and mixes carbon-dioxide with locally supplied water.

The syrup and carbonated water are cooled and mixed by the

dispensing system in a specific proportion to get the ultimate product.

For the pre-mix beverage system carbonation is the final step. It is

done after the mixing of the syrup and water. To protect the unique

flavours that are associated with the products of the Coca Cola

concentrate and beverage bases are kept secret.



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Moreover water treatment is given special emphasis. Since water

quality and character varies from place to place, a treatment process is

utilized to create water, which meets an exacting standard. Uniformity

of water is critical to ensure that every Coca Cola beverage, no matter

wherever it served, will taste exactly the same. The treatment usually

requires chemical treatment followed by filteration through a series of

sand and activated carbon filters. The treatment process varies in each

area because it is specifically designed for local water condition.

All through the production process, quality control personnel take

samples of the product on a regular basis. These samples are taken to

a specially equipped lab where they are tested for quality and to ensure

the correct proportion of ingredients.



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1.1.6 OBJECTIVES OF THE PROJECT:

The soft drink business in India is worth more than Rs. 3,000 crores.

Between April and July almost 50% of the annual sales take place. In

the northeast of India almost 60% of the sales take place in these four

months of the year. Also, Guwahati, the gateway to the northeast, is

solely responsible for 60% of the annual sales of Associated Beverages

Private Limited.

One of the values of the Coca Cola system is presence - that Coca

Cola should exist everywhere and should be available to anyone who

wants a drink, whenever and wherever, on this planet. To fulfill this

goal just producing high quality products is not sufficient. An effective

distribution system holds the key to this ultimate goal. Distribution

includes the activities of sales delivery, merchandising and local

account management.

The main objective of this project is to study the distribution network of

Coca Cola in Delhi and find out the various drawbacks and

shortcomings of it. This project also aims to provide suggestions to

remedify the flaws in the distribution system. Also this project tries to

study the behaviour of consumers towards their preferred brand of soft

drink and what they desire from the company.



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1.1.7NEED OF THE PROJECT AND ITS SIGNIFICANCE

Approximately 70% of Coca Cola beverage purchases are impulse

purchases. This means that when the consumer enters a retail outlet

he did not have any intention in mind of purchasing, but on impulse he

made the purchase. To promote impulse purchasing two factors is very

critical. They are :

Availability

Visibility

Availability means that the products should be available to the

consumer wherever he is and whenever he demands it. Visibility

means that the products or its trademark should be very much

prominent and visible to the consumer so as to promote impulse

purchase.

But the very first factor of availability is a major problem in the Delhi

market. But this is not the case in all parts of the city. During the peak

summer season parts of the city simply go dry and remain so for days

together. At the same time other parts of the city has ample stock.

This non-availability reflects very poorly on the worlds most recognised

brands image, not to say the effect it has on the sales of the company.



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Moreover, Coca Cola is not facing much of a competition from its

traditional arch rival Pepsi. This is because the only bottling plant of

Pepsi in the northeast of India is in Dimapur, Nagaland and its capacity

is very less to cater to the whole of this region. It caters to the

population of Nagaland and parts of upper Assam bordering Nagaland.

this is the only reason why Pepsi has no visible presence in Delhi and

why it has not been able to penetrate into the strong Coca Cola market.

But now Pepsi is setting up a bottling plant in Rani, very close to Delhi

which will have the same capacity as the Coca Cola plant. This bottling

plant which is due to start operations in September 1998, will then cater

to the whole population of the northeast. Now, if the glaring

deficiencies of Coca-Cola in its distribution network are not remedied

than Pepsi will certainly succeed in eating into a sizable chunk of the

Coca-Cola market.

For these above reasons this project is significant to Associated

Beverages Private Limited so that they do not lose out its strong hold

on the Delhi market when their arch rival Pepsi enters the battle field.

For me also this project is of great significant, as after having chosen

marketing as a career this project has given me an opportunity to get

an insiders view of operations of one of the worlds most recognised

brands.



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1.1.8 SCOPE OF THE PROJECT - EXTENT AND

LIMITATIONS

This project is limited only to the Delhi market of Coca Cola and studies

only the distribution network within the city. It does not study any other

market to its distribution. But Delhi being itself responsible for 60% of

the total annual sales of the company this project is of some

significance and can be said to be somewhat representative of the

whole northeast of India.

Moreover, this study relates only to the urban consumer and as such

has no relevance to the psyche of the rural consumer. As such this

project is limited only to the urban market of Coca Cola.

Also, one of the brands of the company viz. Bisleri Club Soda does not

come under the scope of this project as its target market is totally

different from the soft drinks market.

This project covers all the twelve distributors and the retail outlets under

the company within Delhi city.



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2.3 DATA COLLECTION METHODS AND INSTRUMENTS

The data collection method for this project begins with finding a sample

of the population. The population for this project was the entire Delhi

and finding a fairly representative sample of this population can never

be perfect.

At the very beginning the whole market was divided into twelve zones

each having one distributor of Coca Cola and samples proportionate to

the number of retailers the distributor caters to are taken. Again from

each distributor zone the sample taken was at random. There was no

set pattern to select a sample. Moreover, there may be a bias in the

findings, since a majority chunk of the sample were consumers at the

point-of-purchase in market places, parks, cinema halls etc. The

distributors all over the Delhi has 7920 retailers under them, which

include pan-Wallas, school canteens, institutional or office canteens

etc. The distributors do not serve equal number of retailers individually.

Keeping this in mind the sample size taken from each distributor zone

is proportionate to the number of retailers in each zone.

The instrument for data collection was a structured questionnaire

targeted towards soft drinks consumers. This questionnaire was to

know the tastes and preferences of consumers of soft drinks.



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As far as interacting with distributors and retailers of Coca Cola

products there was no fixed structure. The mode of communication

was informal and friendly conversation, which does not limit discussion

within a well-defined boundary. This helps in listening to the distributor

and retailers what they have to say, because prime importance needs

to be given to this, as they are the people who stay in the market the

whole day.

Informal and friendly conversation also allows the mask, that one wears

when doing business, to be dropped to accommodate free flow of

thoughts and ideas. By going to the market and just watching how a

consumer buys a Coca Cola and how a retailer sells it, one can get a

good idea of the operations of the market also.



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2.4 SAMPLING PLAN

The sampling plan was basically random. The sample size chosen was

450 consumers of soft drinks from all over the Delhi city. This sample

size was divided into twelve distributor zones, each zone being the

allotted area to be covered by a distributor. Since, the distributors

within their respective zones serve different number of retailers the

division of samples to the twelve zones cannot be equal. the number of

samples out of the 450 samples to be chosen from each distributor

zone is proportionate to the number of retailers within the parameter of

each zone. All the distributor zones have a total of 7920 retailers.

Similarly for distributor zones having around 1000 retail outlets the

number of respondents chosen was 55 and so on. This way each

distributor zone was represented in a fairly representative manner. But

even then, a bias will be there as the number of consumers being

served by all the retailers are not equal and in some cases there are

vast differences. Due to the non availability of the figures of the exact

consumer size covered by each retailer this bias is inevitable.

Also the respondents chosen were mostly near points-of -purchase with

a soft drink bottle in one hand. These respondents were chosen at

random from parks and recreation centres such as cinema halls etc.



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The questionnaire was targeted at individuals and not households.

This was because every individual is a consumer or potential

consumer. A household may contain more than one consumer and

sometimes it so happens that the tastes and preferences of family

members may not be alike.



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3.1.1 FINDINGS FROM THE QUESTIONNAIRE:

Favourite soft drinks

Out of the 450 soft drink consumers surveyed 121 voted Thums Up

as their favourite soft drink, which is 26,8%

110 respondents voted Coca Cola as their favourite soft drink, which

is 24.4%

59 respondents preferred Pepsi as their favourite soft drink i.e.13.1%

Fanta and Mirinda were very close to each other with 54 (12%) and

52 (11.5%) of the respondents respectively naming these two

brands as their favourite

Limca finds itself at the bottom of the market with just 42

respondents (9.3%) voting for it

12 of the respondents 92.6%) voted for other brands such as frooti,

onjus etc.



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FAVOURITE SOFT DRINK

Coca-Cola

24.4%

Pepsi

13.1%

Thums-Up

26.8%

Fanta

12%

Mirinda

11.5%

Limca

9.3%

Others

2.6%

Males FemalesAge Group

(in years)

less than 20 20-40 above 40 Less than 20 20-40 above 40

Coca Cola 31 23 10 21 17 8

Pepsi 16 12 5 11 9 6

Thums Up 34 25 11 22 19 10

Fanta 15 11 5 10 8 5

Mirinda 14 11 5 9 9 4

Limca 12 9 4 8 7 2

Others 3 3 1 3 2 0

Total 125 94 41 84 71 35



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FAVOURITE SOFT DRINK ACCORDING TO AGE GROUP

(MALES)

Co ca-Cola Peps i Thu ms -Up Fan ta Mir ind a L imc a Oth ers

0

5

10

15

20

25

30

35

Co ca-Cola Peps i Thu ms -Up Fan ta Mir ind a L imc a Oth ers

Males less than

Males 20 -40

Males abov e 40

FAVOURITE SOFT DRINK ACCORDING TO AGE GROUP

(FEMALES)



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Co c a -Co la Pe ps i Th ums -Up Fa nta Mir in da L im ca O th ers

0

5

1 0

1 5

2 0

2 5

Co c a -Co la Pe ps i Th ums -Up Fa nta Mir in da L im ca O th ers

Fem ales les s tha

Females 20-40

Females a bov e 4



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Preferred form of packaging

292 out of 450 respondents (64.8%) preferred the returnable glass

bottle (RGB) form of packaging

81 respondents (18%) voted for cans as their form of packaging

65 respondents (14.4%) preferred the one and a half litre carry away

PET bottles to other forms of packaging.

MOST PREFERRED FORM OF PACKAGING

Returnable

glass

bottles

Pet bolltles Can

0

50

100

150

200

250

300

Returnable

glass

bottles

Pet bolltles Cans



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Criteria for being the favourite drink

204 respondents preferred their favourite soft drinks for its taste /

flavour (45.3%)

Brand Image is the second most important criteria for being the

favourite as 136 respondents (30.2%) have to say

64 respondents (14.2%) have cited advertisements/promotions as

being the criteria for being the favourite soft drink

Price came third as a criteria for purchasing a soft drink with 32

respondents (7.1%) voting for it

Availability was a criterion for only 14 respondents (3%) for being

the favourite soft drink.

182 respondents questioned do not buy any other available soft

drink if their favourite soft drink is not available. The rest 268 go for

other available soft drinks.



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The second choice in case the favourite soft drinks is not

available is as below :

66 respondents each prefer Coca Cola and Pepsi respectively

Thums Up came in second with 54 respondents voting for it

Fanta scored 36 votes as second preference

25 respondents prefer Limca in case of non-availability of their

favourite soft drinks

Mirinda comes in at the bottom with only 21 respondents answering

to it as their second preference

SECOND FAVOURITE SOFT DRINK

Coca-Cola

24.6%

Pepsi

24.6%Thums-Up20.1%

Fanta

13.4%

Mirinda

7.8%

Limca9.3%



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To the statement whether television advertisements play a major

role in the buying process of soft drinks, the response was

somewhat like this :

156 respondents Strongly agreed to it

206 respondents simply agreed to it

65 respondents were neutral to this statement

19 respondents disagreed to this statement

4 respondents strongly disagreed to this statement

ADVERTISEMENTS PLAY A MAJOR ROLE IN THE BUYING

PROCESS

S t r ong l y

a g r e e

A g r e e Ne u tr a l D is a gr e e S tr o ng ly

d i s ag r ee

0

5 0

1 0 0

1 5 0

2 0 0

2 5 0

S t r ong l y

a g r e e

A g r e e Ne u tr a l D is a gr e e S tr o ng ly

d i s ag r ee



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3.1.2 : GENERAL FINDINGS FROM THE MARKET

The sales figures (in number of cases) for Delhi for 2001 2002 are

as follows :

Sales (in cases) 2001 2002

Target 2,79,000 2,86,000

Actual 2,85,000 3,10,000

SALES (IN CASES) IN 2001 2002


2001 2002260000

265000

270000

275000

280000

285000

290000

295000

300000

305000

310000


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The rate of visibility of Coca Cola products in comparison to its

traditional rivals Pepsi was very high .

Pepsi products were found only in a few outlets whereas Coca Cola

products had its presence all over the city.

But at the same time Coca Cola products sometimes were visible

only as empty cases in parts of the city with stock running out while

other parts of the city had ample stock. This condition of parts of the

city going dry while other parts were amply stocked sometimes

continued for a week.

The most common answer to this problem given by the retail outlets

to the consumers was no supply . This means that the company

has not been able to produce and supply as per the existing demand

of the market.

The Burnihat bottling plant had a capacity of filling 120 bottles per

minute which was doubled in 2001 to 240 bottles per minute.

Beside this plant, there is one more bottling plant of Coca Cola

products in Jorhat, in upper Assam. But, it does not have bottling

facilities for Coca Cola and Fanta. It caters only to Jorhat district and

parts of Nagaland bordering Assam.



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Pepsis virtual absence in Delhi can be attributed to the fact that in

the whole northeastern region it has only one bottling plant in

Dimapur, Nagaland that is of lesser capacity than the Coca-Cola

Burnihat plant. This plant caters to the states of Nagaland, Mizoram,

Tripura and parts of upper Assam bordering Nagaland. In Delhi most

of the Pepsi stock comes all the way from Pune.

The distribution of Coca Cola products in Delhi is not very complex.

Mostly it is a matter of few hours between production to

consumption. After production, the products are distributed,

according to the requirements, to the twelve distributors within the

city. These distributors then redistribute the products to the retail

outlets present in their operational territory.

The raw materials for productions such as the concentrate, sugar

and carbon dioxide all come from Calcutta. This is done to maintain

the standard level of purity of sugar and carbon dioxide all over the

world.

The most important piece of news for Coca-Cola in Delhi is that its

archrival Pepsi is setting up a bottling plant at Rani, in the outskirts of

Delhi with a capacity equivalent to the Burnihat plant. This plant at

Rani, which is planned for commencement of operations from

September/October 1998, will then cater to the whole soft drinks

market of the Northeast. The competition after commencement of

operations of the Pepsi plant is bound to get heated up.



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3.1.3ANALYSIS

The population of Delhi as of now is approximately 18,50,000 and ifwe relate this to the sales figure of 2002 we will get a rough estimate

of the per capita consumption of soft drinks in the city. The sales

figure for 2002 was 3,10,000 cases i.e. (31,10,000 x 24) bottles

which is 74,40,000 bottles. This way the per capita consumption

comes to 74,40,000 / 18,50,000 = 4.02 bottles. This means that

every individual consumer consumes approximately 4 bottles of soft

drinks annually.

Now by the year 2000 population is expected to rise to around

19,17,000 which will be an increase of around 3.62%. If it is

considered that the per capita consumption remains constant, then

the demand will also increase like wise i.e. 11,222 cases bringing it

to around 3,21,222 cases. Now, this figure of 3,10,000 cases

achieved in 2002 is not the demand, but supply. And in Delhi

demand is always more than supply (figures from : Statistical Hand

book; Govt. of Assam, 1995)



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Data collected from the questionnaire ranks Thums Up as the mostpreferred soft drink followed by Coca Cola, Pepsi, Fanta, Mirinda,

Limca and others respectively in that order. The other soft drinks

mainly include tetrapack fruit juice beverages such as Frooti, Onjus

etc.

Thums Up 26.8%Coca Cola 24.4%Pepsi 13.1%Fanta 12%Mirinda 11.5%

Limca 9.3%Others 2.6%

The popularity of Thums Up can be attributed to the fact that it already

had a strong market presence even during the times it was with the

Parle soft drinks division before Coca Cola made its entry into India.

But even after five years of its existence in India, Coca Cola has not

been able to overtake its sister brand in terms of market share in Delhi

city.

Taste/flavour and brand image are the two most important factorswhy Coca Cola products are purchased with 45.3% and 30.2%

respondents voting for it.



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Coca-Colas multi local approach to marketing is designed to meetthe needs of the local consumers. It approaches marketing in a

global sense, but works with each area on a local basis, through a

joint partnership between the Coca Cola Company and the bottlers,

which in Delhi is Associated Beverages Private Limited.

The distribution of Coca-Cola products includes the activities ofsales, delivery, and merchandising and local account management.

In the conventional sales system the demand of all retail outlets on

a particular route are estimated and a truck is loaded accordingly.

The route sales person discusses with the customers his actual

needs at the business location and unloads the product, stocks the

shelves and merchandises accordingly. The sales person is also

responsible for local account management, which involves

managing the financial part of the transaction, developing and

maintaining rapport with the retailer and looking for additional sales

opportunities.

By looking for new sales opportunities, the sales person can help

the retailer improve his business. For example, the salesperson

might identify opportunities for the retailer to sell more products or

consider what additional product consumers may want.

Another type of sales technique is called the Advance sell or Pre-

sell system. In this system, a sales person calls on each retailer

with the specific purpose of making a sales call, but does not

actually deliver the products. The sales person establishes rapport

with the retailer, discusses new sales opportunities and



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merchandises the products ordered, usually the following day and

does additional merchandising.

The above two systems were direct distribution system. The other

form of distribution system wherein an organisation which is not

part of Coca Cola system i.e. the distributor, has control over the

elements of distribution viz. delivery, merchandising and local

account management

In Delhi there are twelve authorised distributors who control the

four vital elements of distribution. Each of these distributors is

allotted a fixed number of empties (i.e. cases with empty bottles).

Suppose a distributor is allotted 1000 empties. The distributor may

return say 500 empties and get them filled up. These filled cases

are then sent to the retail outlets within the distributors zone of

operations. Till the time these cases come back as empties the

other 500 empties are filled up by the bottler and in this way the

cycle goes on.

The distributor gets Rs. 10 as commission per case. Moreover,

each distributor is given a target to achieve and if it succeeds in

achieving the target he is given an additional Rs. 2 as incentive on

the total sales. For example, if the distributor is given a target of

15,000 cases to be sold and he achieves 16,000 cases, then his

total commission will be Rs. 12 x 16,000 = Rs. 1,92,000. But if he

achieves a sales of 14,000 cases then his commission will be Rs.

10 X 14,000 = Rs. 1,40,000.



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4.1 RECOMMENDATIONS

To rectify the above deficiencies the following suggestions may be

helpful to the company.

The capacity of the bottling plant needs to be increased. But thismay not be feasible keeping in mind the constraints of the companys

financial strength. In that case, the company should go in for a joint

venture with Coca-Cola India, which will go a long way in facilitating

an increase in the plant capacity or setting up another plant.

The operations of the distributors should be more closely scrutinizedso that they cannot encroach on others territory. For this a watertight

map of the distributor zones should be made. The distributors

should be made accountable for any deficiency in their respective

areas of operation. This will go a long-way in ensuring that no area

goes dry for days together and will also promote more product

visibility.

Suppliers of carbon dioxide and sugar can be appointed within thestate after strict quality control tests and constant monitoring

thereafter. This will go a long way in cutting down transportation

costs and the hassles involved will be eliminated. Also, this will

generate employment for the local masses and the company can

earn goodwill of the public, which in turn will inevitably promote

sales.



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Lapses in communication can be very crucial as in this industry theaverage time period from production to consumption can be just a

few hours. When a concentrate of Coca-Cola is needed and

concentrate for Thums Up comes in, it may result in Coca-Cola

vanishing from the market for one day or two. As such this type of

communication lapses has to be avoided at any cost.

It is now high time for the company to chalk out a strategy to battlePepsi because all this time Pepsi did not offer any sort of

competition to Coca Cola. The company now need to pull up itssocks and start setting its house in order, as Pepsi is about to make

a big entry into the Delhi market.



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QUESTIONNAIRE FOR CONSUMERS OF SOFT DRINKS

Respondents Name

Sex: Age: Occupation:

Please tick your choice or answer wherever necessary:

1. Which is your favourite soft drink?

(a) Coca-Cola (e) Mirinda

(b) Pepsi (f) Limca

(c) Thums Up (g) Others (please specify)

(d) Fanta

2. What makes this soft drink your favourite ?

(a) Taste/Flavour (d) Easy Availability

(b) Price (e) Advertisement/promotions

(c) Brand image (f) Others (please specify)

3. What form of packaging do your buy most?

(a) 1 1/2 Litres carry away per bottle

(b) 300 ml bottle

(c) 330 ml Can

4. Do you buy your soft drinks daily?

Yes/No

5. How much do you consume daily?

(a) 1 bottle (c) 4/5 bottles(b) 2/3 bottles (d) more than 5 bottles



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6. In case you do not find your favourite soft drink with your retailer

do you buy any other alternative?

7. How does your retailer explain the non-availability of your

favourite soft drink?

8. Which is your favourite soft drink advertisement?

Please specify where you saw it?

9. Television advertisements play a major role in the buying

process of soft drinks?

(a) Strongly agree (b) Agree (c) Neutral (d) Disagree

(e) Strongly disagree

10. Can you suggest improvements to make your favourite soft

drinks even better?

(Thanks for your cooperation)



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COCA COLAS BOTTLING PLANTS ALL OVER INDIA

LOCATION BOTTLING

PLANTS

LOCATION BOTTLING

PLANTSAhmedabad Britco Foods Kanpur Jahind BottlingAmritsar Amritsar Beverages Khamama Sri Saravaraya

SugarsAurangabad Waluj Beverages Kurnool Bharat Cottling

South EastBangalore Brindavan

Beverages

Lucknow Brindavan Bottlers

Bareilly Hindustan Bottling Ludhina Ludhina BeveragesBhopal Vishal Beverages Madurai Madurai Soft DrinksBhubhaneshw

ar

Manna Drinks Mangalore Souparnaca

BeveragesBilaspur Narmada Drinks Mumbai Parle BeveragesCalicut Madurai Soft Drinks Nagpur Superior DrinksChandigarh Kandhari Beverages Najibabad Hindustan BottlingChennai Chennai Bottling Nasik Nasik BeveragesDankuni Black Diamond

Beverages

Nellore Pinakini Beverages

Delhi Delhi Bottling Patalganga Parle BottlingFaizabad Amrit Bottlers Patna Orient BeveragesGanganagar Ganganagar

Bottling

Pune Orient Beverages

Ghaziabad Moon Beverages Rohtak Haryana DrinksGuntur Model Bottling Sahibabad Coolade BeveragesGurgaon Enrich Agro Food

Products

Surat Surat Beverages

Guwahati Associated

Beverages

Tarapur Dobule Cola

BeveragesHathras Brindavan Agro Taratala Black Diamond

BeveragesHyderabad Bharat Bottling

South East

Trivandrum Hind. Bottling South

WestIndore Indore Bottling Udaipur Mewar Bottling

Jaipur Jaipur Bottling Varanasi Varanasi Bottling Jammu Jammu Bottling Vemagiri Sri Saravaraya

BottlingJamshedpur Jamshedpur

Bottling

Vijaywada Vijaywada Bottling

Jodhpur United soft Drinks Visakhapatna

m

V.B.C. Industries



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4.2: CONCLUSION

The Rs. 3,000 crore soft drink businesses in India score its biggest hit-

almost 50% of all soft drink sales - between April and June. And it is

during this period that the Delhi market goes dry from time to time.

70% of soft drink sales is through impulsive buying i.e. the consumer

comes to the retail outlet without any intention to buy but on impulse

actually purchase a soft drink. To promote these purchasing two

factors are very important. They are :

Availability

Visibility

If even one of these factors is lacking then a big chunk of sales can be

lost. In Delhi the following deficiencies need to be rectified by Coca-

Cola to retain and increase its present market share:

The capacity of the bottling plant, inspite of being doubled to 240

bottles per minute is still not sufficient to meet the huge of the

market.

The distributors, inspite of having areas of operation do not stick to

them but try to grab markets of each other to increase their sales.



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The basic ingredients like sugar and carbon dioxide is brought all

the way from Calcutta and the flow of goods is not smooth because

of the volatile political and highly militant atmosphere of the

northeastern region.

The communication gap between the supplier and bottler can prove

costly if its frequency increases during the peak season.



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BIBLIOGRAPHY

Business India

India Today

Marketing Management

By Philip Kotler

Marketing Research - Text and Cases

By H.W. Boyd, R. Westfall and S.F. Stasch

Research Methodology

By C.R. Kothari

Statistical handbook; Govt. of Assam, 1995.

The Times of India



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PREFACE

This is to certify that Archit Shankar has

completed his project report under the guidance

of ____________________ on the topic Marketing

Management of Coca Cola India, as a pre-

requisite of B.B.A. (H) Semester 7th.

Signature

marketing management - coke

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