Coca Cola

Case Study Coca Cola Closing Case Chapter 12 Done By Desyani Rosadi National University June 14, 2011 Q&A 1. Why do you think that Roberto Goizueta switched from a strategy that emphasized localization towards one that emphasized global standardization? what were the benefits of such a strategy localization is the process of adapting a product or service to a particular language, culture, and desired local “look-and-feel. ” Ideally, a product or service is developed so that localization is relatively easy to achieve. Global Standardization is the process to push a international company / brand to become more centralized in management. think Roberto Goizueta switched Coca cola strategy from localization to global standardization in order to pushed Coke to become a global company, by centralizing a great deal of management and marketing activities at the corporate headquarters in Atlanta, focusing on core brands, and taking equity stakes in foreign bottlers so the company could exert more strategic control over them. This one-size-fits-all strategy was built around standardization and the realization of economies of scale by, for example, using the same advertising message worldwide. 2. hat were the limitations of Goizueta’s strategy that persuaded his successor, Daft, to shift away from it? What was Daft trying to achieve? Daft’s strategy also did not produce the desired results. Why do you think this was the case? The limitations of Goizueta’s strategy was in the very 1990s is when Coke failing to hit the financial targets for the first time because  the one-size-fits-all strategy was running out of steam, as smaller, more nimble local competitors marketing local  beverages began to halt the Coke business development. So that, Daft shift away the strategy to be more localization.

Daft was trying belief that Coke  needed to put more power back in the hands of local country managers. He thought that strategy, product development, and marketing should be tailored to local needs. Dafts was so influenced by the Coke in Japan that localization for coke company in Japan is very successful, but the thing is every country different, and not all will do as succeed as Coke in Japan. 3. How would you characterize the strategy Coke is now pursuing? what is the enterprise trying to do? how is this different from the strategies of boy Goizueta and Daft?

What are the benefits? What are the potential costs and risk? Now coke strategy is pursuing their markets by reviews and guides local marketing and product development, but has adopted the belief that strategy, including pricing, product offerings, and marketing message should be varied from market to market to match local conditions. the differences from Goizueta and Daft strategy is the now CEO combine both strategy of localization and global standardization, and He has stressed the importance of leveraging good ideas across nations. 4.

What does the evolution of Coke’s strategy tell you about the convergence of consumer tastes and preference in today’s global economy? As back to the different culture in every nation, we need to localization the brand, but as an international brand, we have to do the global standardization as well. the success of Neville Isdell, Coke CEO in 2004, who make a new breakthrough of marketing strategy by pull out the middle point between localization and global standardization. The evolution of Coke’s strategy tell me about consumer tastes in every nation is different. for instant, when coke subsidiary in China developed a low-cost oncarbonated orange drink that has rapidly become one of the best selling in that nation and also popular in Thailand, while in Japan, the Georgia coffee is the huge hit. Essay INTRODUCTION It is very common to see a mature domestic brand or company start expanding their operations to other countries to achieve growth. Better ways of communication, Developed technologies, and a fast transport has turned this world into a one spot global, making International markets more accessible, and business pursuing a global position get the benefits of increase in brand awareness and cost effectiveness.

All these develoments created a new concept of Global standardization (Mughal, 2005)  Coca Cola, an International American soda maker, has long been among the most International enterprises. The company made its first move outside the United States in 1902, when it entered Cuba. by 1929, Coke was marketed in 76 countries around the world. In World War II, coke struck a deal to supply the U. S military with Coca cola, wherever in the world it went. During this era, the company built 63 bottling plants aroudn the world.

Its global oush contunued after the war, fueled in part of the belief that the U. S market would eventually rech maturity and by the perception that huge growth opportunities lay overseas. Today more that 59,999 of the company’s 71,000 employees are located in 200 countries outside of the United States and over 70 percent of Coke’s case volume is in International markets. Until the 1980’s, coke’s strategy was one of considerable localization. Local operations were granted a high degree of independence to manage their own operations as they saw fit.

This a;; changed in the 1980s and 1990s under the leadership of Roberto Goizuetta, a talented Cuba immigrant who became the CEO of Coke in 1981. Goizueta placed renewd emphasis on Coke’s flagsip brands, which were ectended with the introduction of Diet COke, Cherry Coke, and the like. His prime belief was that the main difference between the United States and international markets was the lower level of penetration in the latter, where consumption per capita of colas was only ten to fifteen percent of U. S consumption.

Goizueta pushed Coke to become a global company, centralizing a great deal of management and marketing activities at the corporate headquarters in Atlanta, focusing on core brands, and taking equity stakes in foreign bottlers so the company could exert more strategic control over the,. This one-size-fits-all strategy was built around standardization and the realization of economic of scale by, for example, using the same advertisement message worldwide. Widespreade, consistent exposure also helps create a global brand such as Coca cola because it forges a strong, unified image all over the world.

You can see Coca cola signs are visible on billboards in London and on metal roofs deep in the forests of Thailand. In contrast, those in favor of localization feel that the world is not that small, but still Coke still need to tailor products and promotional messages to local environments. Goizueta’s global strategy was adopted by his successor, Douglas Ivester, but the late 1990s the drive towards a one-size-fits all strategy was running out of steam, as smaller, more numble local competitors