COCA-COLA
In 1886, John Pemberton, a Civil War veteran and Atlanta pharmacist, found a
fragrant,caramel-colored liquid which was combined with carbonated water and John
Pemberton’s bookkeeper, Frank Robinson named this mixture, Coca-Cola.
In its first year, the company sold about 9 glasses of Coca-Cola a day. A century later,
The Coca-Cola Company has produced over 10 billion gallons of syrup. 1888-1891,
Pemberton sold the company to Atlanta businessman, Asa Griggs Candler, for a total of about
$2300. Candler would become the company's first president, and the first to bring real vision
to the business and the brand.
By 1895, Candler had built syrup plants in Chicago, Dallas and Los Angeles. In 1894,
a Mississippi businessman named Joseph Biedenharn became the first to put the drink in
bottles. In 1916, the Root Glass Company of Terre Haute, Indiana, began manufacturing the
famous contour bottle. As the country roared into the new century, The Coca-Cola Company
grew rapidly, moving into Cuba, Puerto Rico, France, and other countries and U.S. territories.
In 1900, there were two bottlers of Coca-Cola, by 1920, there would be about 1,000.
Coca-Cola traveled with the U.S. team to the 1928 Amsterdam Olympics, the logo was
emblazoned on racing dog sleds in Canada and the walls of bullfighting arenas in Spain.
After 75 years of amazing success with brand Coca-Cola, the company decided to
expand with new flavors: Sprite® in 1961, TAB® in 1963 and Fresca® in 1966.
The Company's presence worldwide was growing rapidly, and year after year, Coca-Cola
found a home in more and more places: Cambodia, Montserrat, Paraguay, Macau, Turkey and
more.
In 1978, The Coca-Cola Company was selected as the only company allowed to sell
packaged cold drinks in the People's Republic of China
In1985, diet Coke® is found that is the very first extension of the Coca-Cola
trademark -- within two years, it had become the top low-calorie drink in the world, second in
success only to Coca-Cola.
NEW MARKETS AND BRANDS
The 1990s were a time of continued growth for The Coca-Cola Company. The
Company's long association with sports was strengthened during this decade, with ongoing
support of the Olympic Games, FIFA World Cup football (soccer), Rugby World Cup and the
National Basketball Association. Coca-Cola classic became the Official Soft Drink of
NASCAR racing, connecting the brand with one of the world's fastest growing and most
popular spectator sports.
And 1993 saw the introduction of the popular "Always Coca-Cola" advertising
campaign, and the world met the lovable Coca-Cola Polar Bear for the first time.
New markets opened up as Coca-Cola products were sold in East Germany in 1990 and
returned to India in 1993. New beverages joined the Company's line-up, including Powerade
sports drink, Qoo children's fruit drink and Dasani bottled water. The Company's family of
brands further expanded through acquisitions, including Limca, Maaza and Thums Up in
India, Barq's root beer in the U.S., Inca Kola in Peru, and Cadbury Schweppes' beverage
brands in more than 120 countries around the world.
By 1997, the Company already sold 1 billion servings of its products every day, yet
knew that opportunity for growth was still around every corner.
1
COCA-COLA NOW
In 1886, Coca-Cola brought refreshment to patrons of a small Atlanta pharmacy.
Now well into its second century, the Company's goal is to provide magic every
time someone drinks one of its nearly 400 brands. Coca-Cola has customers
from Boston to Budapest to Bahrain, drinking brands such as Ambasa,
Vegitabeta and Frescolita. In the remotest comers of the globe, you can still find
Coca-Cola.
Coca-Cola is committed to local markets, paying attention to what people from
different cultures and backgrounds like to drink, and where and how they want to
drink it. With its bottling partners, the Company reaches out to the local
communities it serves, believing that Coca-Cola exists to benefit and refresh
everyone it touches.
From the early beginnings when just nine drinks a day were served, Coca-Cola
has grown to the world’s most ubiquitous brand, with approximately 1.3 billion
beverage servings sold each day. When people choose to reach for one of The
Coca-Cola Company brands, the Company wants that choice to be exciting and
satisfying, every single time.
Today, The Coca-Cola Company is the largest beverage company with the most
extensive distribution system in the world. But they are so much more. Their vision spans
across five areas:
People


The Coca-Cola Company, including the bottling entities they own, employs
approximately 55,000 people. More than 44,000 of those employees work for the
Company outside of the United States.
They are the largest private-sector employer across all of Africa. And in the country of
South Africa, for every one job created by the Coca-Cola system, 16 jobs are created in the
informal retail sector.
Planet



Working with their Brazilian partners, the Company has launched a program to reduce
greenhouse gas emissions by using alternative fuels. Their bottling partner in Sao Paulo
has a fleet of approximately 140 trucks running on 5 percent biodiesel (made form castor
beans and soybeans).
The Coca-Cola Scholars Foundation has awarded more than $26 million in highereducation scholarships to 3,250 students in the United States since its inception in 1986.
The Coca-Cola system has a comprehensive HIV/AIDS health care program in Africa,
covering nearly 60,000 employees, their spouses and their children
Portfolio

The "Make Every Drop Count" campaign, launched in North America, is designed to
help increase awareness of the benefits of the Company's broad beverage portfolio and its
commitment to consumers.
2

Bonaqua Bonactive launched in Hong Kong in April 2005 and is the first electrolyte
replenishment and rehydration casual sports drink released under the Bonaqua trademark
Profit


Approximately 72 percent of their unit case volume is from operations outside of
North America.
In 2005, they had double-digit unit case volume growth in Pakistan, China, Egypt and
Russia.
Partners

In partnership with the Italian Ministry of Education and the Italian National Olympic
Committee, they have created the "Schools in Motion" program in Italy to encourage
physical activity. More than 130,000 students from 1,200 schools have participated
ECONOMIC IMPACT
The Coca-Cola business is essentially a local one. With their bottling partners, they produce
their products in more than 800 plants around the world. In those plants and other facilities,
they employ local people, pay taxes to governments, pay suppliers for goods, services and
capital equipment, and support community investment programs.
They support socioeconomic development in developing and emerging markets through
economic opportunities and wealth creation as well as technology and knowledge transfer;
local entrepreneurship; and other international investment.
COKE’S PRIMARY GOAL
Coca-Cola company’s primary goal is taking control of the European market. The
average American consumes almost 291 12-ounce servings of Coke annually, while in Iceland
consumptions is a whopping 333 servings. On the other hand, many Europeans are not big
Coca-Cola drinkers. The average annual number of 12-ounce servings in Germany, Spain,
Belgium and Austria is 166; in Great Britain, Ireland and Switzerland it is about 110; France,
Italy and Portugal lag behind with consumption at an average of 65. However all of this is in
the process of changing. Coke has undertaken a powerfull campaign to dramatically increase
consumption in Europe.
One of the first strategic steps has been to replace local franchisers who had become
too complacent and turn their franchises over to more active, market-driven sellers. For
example Pernod company in France.
In England, Coke’s national bottlers turned over to Cadbury Schweppes which took
Coke sales tripled in the first three years.
In Germany, Coca-Cola invested in distributıon networks to package and sell Coke
locally. As a result Germany is now Coca-Cola’s largest and most profitable market in Europe
and the company has the largest soft-drink market share in every country in Eastern Europe.
Some government agencies and companies are concerned about the way in which
Coca-Cola is pushing aside those who are unable to lower cost and generate more business.
3
The European Union’s DG-IV Competition Department, based in Brussels, is investigating
possible anti-competitiveness in Coke’s bid to purchase CCSB, a British bottler. In Britain
British Monopolies and Mergers Commissions investigated Coke on its joint venture with
Schweppes; and San Pellegrino, the mineral water company, filed a complaint with the
Commission of the European Communities, contending that Coca-Cola has abused its
dominant position by giving discounts to Italian retailers who promised to stock only Coke.
As the European Union eliminates all internal tariffs, it wil be possible for a chain
store with operations in France, Germany, Italy and the Netherlands to buy soft-drinks from
the lowest cost supplier in the continent and not have to worry about paying import duties for
shipping them to the retail stores. So low cost and rapid delivery are going to be key strategic
success factors in what is likely to a major “cola war”. Coke believes that its current strategy
puts it in an ideal position to win the war.
COMMENTS
The Coca-Cola Company is an international business.The impetus of strategic focus is
shown on Axis A. First, The Coca-Cola Company is established to response to domestic
needs. And they frequently think only of domestic opportunities until a foreign opportunity
presents itself to them. Then in 1920’s Coca-Cola move from passive to active expansion with
4
aspects of their business and the company start to interact with Cuba, Puerto Rico, France,
and other countries and U.S. territories.
Internal versus external handling of foreign operations shown on Axis B. At the
beginning Coca-Cola uses intermediaries to handle foreign operations during early stages of
international expansion. But by growing the company usually handle the operations with its
own staff. They produce their products in more than 800 plants around the world and in those
plants and other facilities, they employ local people. Ayşen’s opinion is that by this way
Coca-Cola company aims to minimize the operation risk.
In Germany, Coca-Cola invested in distributıon networks to package and sell Coke
locally. As a result Germany is now Coca-Cola’s largest and most profitable market in
Europe.
Axis C shows that importing or exporting is usually the first mode a company
undertakes in becoming international. The Coca-Cola company is having extensive
production abroad with foreign direct investment and all functions like exporting and
importing and also franchasing. For example in Turkey Coca-Cola gives first franchising to
IMSA(Has Group) in 1964. Coke is making FDI in order to improve its market position
especially in Europe. The company do this in three ways. First, the construction of new
bottling plants is helping the company produce a low cost product. Second, marketing
expenditures are helping the company to gain the product recognition needed for growth.
Third, direct investments in facilities closer to the market are reducing delivery time and
eliminating import duties.
In Tugçe’s opinion Coca-Cola company wants to continue its international operations
by expanding its trade to new markets or complements them with new types of business
activities.For example; In England, Coke’s national bottlers turned over to Cadbury
Schweppes which took Coke sales tripled in the first three years.
The Coca-Cola company is doing business in 140 foreign countries. As we see on the
Axis D, Coke is would be at the point that”many”. In all of these countries 5.8 billion people
drinking these delicious soft-drink. In every seconds 8000 bottles of Coke is consumed by
people in the world. Coca-Cola has grown to the world’s most ubiquitous brand, with
approximately 1.3 billion beverage servings sold each day. Approximately 94 percent of the
world population know the name of Coca-Cola. These results shows how the Coca-Cola
spreads all over the world and it continues this fast growth with new brands, new products,
and new markets.
The Axis E considers to similarity or dissimilarity between foreign and domestic
countries. If we examine the company structure of Coca-Cola we can easily see that there is a
large dissimilarity between countries the Coke company operates in. Coca-Cola is committed
to local markets, paying attention to what people from different cultures and backgrounds like
to drink, and where and how they want to drink it.
On our figure there is three stage of internationalization, high, medium, low. The
Coca-Cola company is would be on the stage “high”.
According to our opinion Coke is an multinational enterprise because it conducts
production and distribution activities in nations other than its home country. In terms of
strategy and management orientation, the firm does three things that illustrates its
multinational nature. First, Coca-Cola adjusts its operations to meet local needs. The firm
markets on a country-by-country basis. Second, Coke has international partners who help to
run the operation and do not report directly to the company on day-to-day matters.
Third, the organization relies heavily on team work by all involved parties and service more
as a coordinator and leader for the product than as an on-site manager.
5
NEGATIVE REACTIONS OF OTHER COUNTRIES TO
COCA-COLA
In the process of internationalization,Coca-Cola is exposed to lots of challenges from
countries which Coca-Cola interacts with.
One of them is obesity of children.Some people give complaints about the negative
effects of drinking Coke. But CEO of Coca-Cola Turkey, Muhtar Kent, gived responses to
these complaints recently. He clarified that drinking Coke is not a reason of obesity. The
children obesity is caused by not doing sportive exercises and staying on chair in front of the
computer for a long time.And he continues that Diet Coke is not unhealthy for children.
When the Coca-Cola go on abroad, it comes face to face with local competitors. For
example in England the local brand of Mecca Cola and in Turkey Cola Turka.But Coke has a
strong position towards these brands because of brand loyalty.
Some groups in Islam society argue that The Coke is giving support for Jewishs’
capital. But this assertions stay as rumour because up to now there is no clear evidence.Also
some Muslim people and Palestinians argue that Coca-Cola giving assistance to Israel army in
the Palestine-Israel war.Because of this sales of the company is a little decreased.
At 23.08.2006 El Ezher University, Assembly of Islamic Issues, asserts that drinking
Coke is forbidden by Islam religion because, by the investigations in Jordan they conclude
that Coca-Cola has additives which made by pork.
In August 2006, in India Coca-Cola is pronhibited because of the poisonous additives
Coke includes.
Some groups of people and members of religous orders bring forward that when
looking reversly to the brand name of Coca-Cola, in Arabic language it means that there is no
Muhammed and there is no Mecca.Thus they proposed not drinking Coke for all people who
believe in God.
As we see in these examples, negative reactions the Coca-Cola company encountered
is decreasing the company sales and damaging the brand esteem of Coke.We suppose that
some of these rumors are arised from the marketing strategy of local rivals.
COKE’S COMPETITIVE ADVANTAGE
Coke faces strong competations in European countries. Europeans do not drink as
much as Coke as do Americans; drinks like coffee and tea are more popular. Coke is using
this situations to help formulate its strategy. This includes new bottling plants that are driving
down costs and making Coke more price competitive, and marketing campaigns designed to
drow customers away from competitive products. The firm is also entering into joint ventures
with local partners. And these groups are helping the firm to understand national tastes and
how to formulate local response strategies.
6
BIBLIOGRAPHY

RUGMAN Alan M. & HODGETTS Richard M., International Bussiness a Strategic
Managment Approach, Prentice Hall, second edition, 2000

DANIELS John & RADEBAUGH Lee H. , International Business Environments and
Operations, Addison Wesley, sixth edition, 1991

DANIELS John & RADEBAUGH Lee H. , International Business Environments and
Operations, Addison Wesley, ninth edition, 2003







www.basinkonseyi.org.tr
www.cci.com.tr
www.cocacola.com.tr
www.hürriyetim.com.tr
www.ishbul.com
www.islamiforum.com
www.thecoca-colacompany.com
7