Coca Cola External Environmental Factors

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External Environmental Forces

During the strategic marketing management process, there are many external forces that any company must be aware of in order to be profitable. These very important factors to be considered come in the form of technology trends, economic and government trends, consumer trends and innovations. It is very important to become aware of all of the potential opportunities and threats that may arise from these trends. I believe that for Coca-Cola, there are external forces in all of these areas that they must be aware of and incorporate into their planning if they are to continue to be successful.

When it comes to technology, in recent years there are many emerging trends that I feel that Coca-Cola could use to their advantage. The popularity of services such as Twitter and Facebook may give Coca-Cola the opportunity to spread the word about their products to territories that haven’t yet been reached by their competitors. Since the majority of people use these services all over the world, we feel that it is a great place for them to advertise. While it is still very important to have advertisements on television, more and more people are using the internet, and we feel that by collaborating with internet companies, they would be able to increase their profits. In addition to the increased use of the internet, another technology trend that Coca-Cola should be aware of is the production of bio-degradable bottles. Today’s plastic bottles are very bad for the environment and people are aware of this. Until recently, there was only technology to produce plastic that was made from petroleum. Now though, in the year 2010, there is technology to produce plastic that is made from plants. This plastic, also known as PLA or polylactide, emits fewer greenhouse gases, uses less energy than other plastic bottles and is also recyclable and compostable. We believe that since the environment is such a high priority in everyone’s minds, they should take advantage of this technological development.

Economic and Government trends are an extremely important part of the external environment. Since consumers are directly affected by the status of an economy, a company should always be aware of the economic conditions in the countries in which they operate. Currently, all over the world, we are dealing with a recession. The unemployment rate is very high, and as a result, consumers have decreased buying power. When consumers have less income, the first thing that they stop buying are luxury goods. In my opinion, Coke is a luxury item and not a necessity. I feel that if Coca-Cola wants to continue to be successful in the current economic conditions, they must begin to produce goods that people must buy. An example of such a product would be dairy products, like milk. While a consumer who has a strict budget may skip purchasing Coke, they will not skip on purchasing milk.

While technological and economic factors are extremely important to Coca-Cola, we feel that currently, the most important factor that needs to be addressed are changing consumer trends. Today, consumers are becoming more and more health conscious. When people purchase a food or drink, we think that they would ideally prefer something that has some health benefits to it. Coke has always been criticized for being bad for your health due to the food coloring, carbonation and high-fructose corn syrup. While we don’t believe that it is likely that Coca-Cola will lose much business to other cola competitors such as Pepsi, I do feel that they will lose business to companies that are producing healthy alternatives to cola, such as fruit drinks. I feel that Coca-Cola should be innovative and possibly consider changing some of the ingredients in Coke, such as using natural sugar instead of corn syrup and natural sources of food coloring rather than chemicals. Another very important consumer trend that should be noticed by Coca-Cola is the increasing...
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