Coca Cola’s environment has been changing over time and there was increased competition from other beverage companies and local brands around the world. With the ever-changing world, people were no longer satisfied with the norm and required new drinks that satisfied their needs. The environment that Coke was in changed right in front of their eyes and in an attempt to deal with the changing environment Coke’s strategy had to change. Coke shifted their strategy of focusing on just carbonated drinks to introducing different beverages that catered to the needs of people. They changed their philosophy to think local and act local. The company decentralized the operational and marketing functions and gave local managers more authority. The new structure gave local managers the responsibility for local market analysis, new product development, and management of the local brand portfolio. With the new structure, Coke was able to introduce new products faster and tailored their products to the needs of their customers.
Coke’s strategy before Daft was focused on the carbonated drink sector and expanding its brand in emerging countries such as Russia, China, and India. In addition Coke would try to acquire businesses in emerging countries and take advantage of the distribution networks to push the Coke brand. Coke centralized its concentrate production business and marketing and these aspects of the business would be run from Atlanta. Independent bottlers in various different regions around the world handled the bottling and distribution. The independent bottlers would execute the strategy and handle all the heavy lifting.
Some of the strengths in this strategy are that Coca Cola was able to “concentrate on concentrate” and this allowed them to focus on marketing campaigns and expanding in emerging countries. Also, bottlers would incur all the expensive costs associated with bottling and distribution while Coke maintained a clean balance sheet and focused on...
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