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Concepts of Marketing Principles Oz Assignments
The marketing principles to provide a discussion on the marketing principles by providing an insight into the macro environment analysis of Coca Cola. This involves the analysis of the political, business economic, social, technological and environmental factors.
The report aims at providing an overview of marketing principles by undertaking a macro environment analysis of Coca Cola (coca-cola.com, 2018). The discussion in the report therefore revolves around the political, economic, social, technological, environmental and legal factors .
The macro environment represents the PESTEL analysis where the acronym stands for the political, economic, social, technological, environmental and legal.
Political Factors: Coco Cola employs direct advocacy and trade associations to carry out political lobbying. Therefore, changes in established law such as internal marketing and labor laws might prevent the smooth operation of the company (Gillespie & Riddle, 2015). Besides, Coca Cola represents a nonalcoholic beverage company whose product requires certification from the Food and Drug Administration (FDA), a government department. The FDA plays the role of certifying and checking the entire manufacturing process within firm. Thus, changes in governmental policies related to the accounting standards and the taxes influences the operation of a firm. The company should therefore have adaptable strategic management process for withstanding the changes in the political factors.
Economic Factors: The revenue of Coca Cola stands at $9.702 billion instead of $9.652 billion. This proves beneficial for the firm provided the prediction of the global recession and uncertainty due to Trump administrations and Brexit have a positive impact on the firm’s operation. Besides, the supply and the demand conditions are determined by economic factors like the unemployment rates, disposable income, interest rates, gross domestic product, the retail price index and the exchange rates. The increase in price of the raw materials and packaging are adjusted through an increase in price of the soft drinks.
Social Factors: The social and the cultural factors includes the fashions, customs, traditions, level of the education, religious values, distribution of the income and the consumer consciousness. These factors directly or indirectly have an impact on the demands of the product. The increase in the level of education have enhanced people’s health awareness on obesity due to consumption of a sugar sweetened carbonated soft drink. Coca Cola promotes a sugar free and healthier version of the product thereby acting proactive in response to curbing the epidemic of obesity.
Technological Factors: The changes in the technology offer both threats and possibilities of the business. Coca Cola thus adapts to technologically efficient stands by employing a Bridge program that allows the company in adopting newer technologies faster in comparison to the competitors. Thus, Coca Cola believes in following long term strategic approach towards the changing technological aspects and thereby maintains competitive advantage over rivals.
Environmental Factors: Coca Cola has adopted smarter schemes for boosting the recycled materials for packaging and a sustainable production (Sempels & Hoffmann, 2013). Coca Cola also planned to tackle the largest environmental change through increasing the recycled used of plastic in bottle by just 50% thereby signifying the firm’s lack of contribution in tackling the business environmental management challenges. The company should strongly adhere to the environmental laws in manufacturing their products. Non compliance with the laws will not only impact product distribution but also lead to a complete stoppage in production.
Legal Factors: Coca Cola found itself in a legal dispute with claims of deceiving customers about heath risk in using sugar sweetened beverages (Sepkowitz, 2013). The company however makes political contributions through compliance with regulations, laws and the legal requirements for the purpose of reporting. Political contributions are also made in compliance with the decisions of the senior government leaders and the legal counsel leaders responsible for approving and reviewing the political contributions.
On a concluding note, it can said that despite one of the leading beverage brands of the industry, Coca Cola is not immune to the impacts of the macro economic factors.
1. coca-cola.com (2018). [online] Available at: https://us.coca-cola.com/ [Accessed 28 Sep. 2018].
2. Gillespie, K., & Riddle, L. (2015). Global marketing. Routledge.
3. Sempels, C., & Hoffmann, J. (2013). Sustainable innovation strategy: creating value in a world of finite resources. Springer.
4. Sepkowitz, K. A. (2013). Energy drinks and caffeine-related adverse effects. Jama, 309(3), 243-244.