Coca Cola Market Research Assignment In UAE - Tutors India

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COCA COLA MARKETING IN UAE
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TABLE OF CONTENTS
1. INTRODUCTION 3
2. TASK- I 3
2.1 COCA-COLA IN THE UNITED ARAB EMIRATES- AN ANALYSIS 3
2.2 PESTLE ANALYSIS 4
3. TASK- II 6
3.1 AN OVERVIEW OF COCA-COLA- VISION, MISSION AND COMPANY VALUES 6
4. TASK- III 7
4.1 CORPORATE SOCIAL RESPONSIBILITY 7
5. TASK- IV 9
6. TASK- V 10
6.1 ANALYSIS OF INTERNAL ORGANISATIONAL STRENGTHS- SWOT ANALYSIS 10
7. TASK- VI 11
8. RECOMMENDATIONS 13
REFERENCES 15

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1. Introduction
Global marketing and internalisation of products could be a challenging task for an
organisation since various differences are predominant in different countries which are
attributed to the cultural, political and economic stances of the country. In addition, there
are regulations and domestic laws pertaining to the specific country for which a product or
brand needs to be familiarised. Though serious challenges may pose probabilities of failure,
when properly marketed and administered in a new market, numerous benefits and oppor-
tunities could be witnessed (Wintranslation, 2016). One among the key challenges faced by
authorities in an organisation in the context of marketing products or services overseas is
the act of either standardise the product/ service or adapt to the situations of the new
market (Loukakou & Membe, 2012). These inferences become the essence of the present
essay in analysing the market strategies of a specific company (‘Coca-Cola’) in UAE. Special
emphasis will be laid upon analysing the operations of the organisation in the selected geo-
graphical location; the mission, vision and objectives of the selected organisation; the social
responsibility and marketing ethical issues of the company in the selected country; the key
competitors and the critical factors of the selected organisation towards success.
2. Task- I
2.1 Coca-Cola in the United Arab Emirates- an analysis
There is one name that is phenomenal in the sector of food and beverages all over the
world. The ‘Coca-Cola’ company is one among the world’s leading manufacturers of
soft-drinks and is termed to be the most successful brand of all time.With its inception in the
year 1886, the soft-drink maker sells around 400 different non-alcoholic soft-drinks with
different names and its operation is widespread across 200 different countries worldwide.
The company sustained even at tough times for more than a century witnessing war, peace,
economic prosperity, depression and so on (Ki et al., 2011). During the late 1990s, the com-
pany was declared one of the most regarded firms in the world and supposed to win any
marketing situation with its dedicated management team. However, due to internal and
external threats, the company had been witnessing challenges since the beginning of 1998
till date. This led us to conduct an analysis of the company’s existence in UAE considering the

macro-economic factors affecting the organisation. In this context, PESTEL analysis is per-
formed.
2.2 PESTLE analysis
Several approaches exist for the investigation of the business environment in which
an organisation functions. They are PEST (political, economic, socio-cultural, technological),
PESTEL (political, economic, socio-cultural, technological, environmental (or ecological),
legal), PESTLIED (political, economic, socio-cultural, technological, legal, international, envi-
ronmental (or ecological), demographic) and STEEPLE (socio-cultural, technological, envi-
ronmental (or ecological), economic, political, legal, ethical) (Cadle et al., 2010). In the cur-
rent context, PESTEL analysis is selected to study the political, economic, socio-cultural, tech-
nological, environmental (or ecological), legal factors of an environment which affect the
operations of an organisation. The environmental pressures on an organisation will be cov-
ered and examined using the PESTLE approach.
Political analysis:
Countries all over the world adapt some form of procedure in regulating the manufacture of
food and beverages. This is compliance with the regulations of Food and Drug Administra-
tion (FDA). Companies which fail to adhere to the norms of the government are fined by the
respective governments of the country. In this context, Coca-Cola should adhere to the laws
and regulations of the UAE and some of the factors influencing the operations at Coca-Cola
are as follows:
a) Changing laws and regulations of the country
b) Political condition, such as government changes and conflicts within the nation
For Coca-Cola:
There has been a serious threat for American companies since many Muslim countries have
boycotted Americana products. When political stances change, it ultimately influences the
organisation. Several middle-east companies boycotted American goods to a large extent.
The war stance of America upon various Muslim countries may affect the Coca-Cola market-
ing and sales in UAE (Choudhury, 2016).
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Economic factors:
The soft drinks industry in the middle-east countries is booming. For the next 5 years from
2014, the industry is supposed to grow phenomenally. The large market size and viable
regional standards aid the progress of soft-drinks Company in Saudi-Arabia, the UAE and
Qatar (BMI Research, 2016). Hence, the economic factors are supportive to Coca-Cola for the
company to flourish in the UAE.
Social factors:
A report by the UAE healthcare sector revealed that 90 per cent of deaths in the nation are
caused by diseases due to the growing fast-food culture, use of tobacco and so on. It is also
stated that the UAE is a nation with high prevalence of diseases such as diabetes, cardio-vas-
cular disorders and obesity. The nation is striving to curb chronic food and lifestyle induced
diseases and is campaigning to mitigate the number of fast-food consumers (USUAE Busi-
ness Council, 2014). This may affect the behaviour of people consuming high-carbonated
and high-caloried soft-drinks like Coca-cola.
Technological factors:
An interview with his highness Shaikh Mohammed bin Rashid Al Maktoum, the vice-Presi-
dent, Prime minister and the Ruler of Dubai, UAE on September 2014 revealed that UAE is
emerging as an hotspot of technology and is the platform of many technological interven-
tions (Khaleej Times, 2014). Since people in Dubai and UAE had adopted new technologies,
new changes in advertising and marketing need to be implemented for a product to attain
success. Coca-Cola maintains excellent marketing strategies opting technology in every
operation of the country.
Environmental factors:
The Government of UAE is stringent in maintaining environmental harmony in addition to its
economic diversification policies. Environmental maintenance forms the basis of Industrial
growth in UAE and the values of the Government are so keen in maintaining the same (PKF,
2009). Coca-Cola initiated the ‘Every drop matters’ programme in the UAE which is a joint
initiative of the company with the UNDP and the Emirates Environmental Group (EEG).
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In this manner Coca-Cola supports water conservation in the nation which further strength-
ens the relationship between the company and the country.
Legal factors:
The legal laws in UAE include customer law, health and safety law, employment law and so
on. Any drastic changes in the aforementioned laws will have serious effects on the
company.
3. Task- II
3.1 An overview of Coca-Cola- Vision, mission and company values
‘Coca-Cola’has been a successful brand for a century and more. A quick glance at the
company’s website revealed the mission, vision and objectives of the company to move
forward. The perceptions of the company are towards driving the popular brand to reach
new peaks within the next 10 years by preparing themselves for the phenomenal change.
The declaration of the vision and mission statements is the reflection of the views of both
the company and the individuals operating the soft-drink maker. The mission of the compa-
ny is to refresh all the senses: the mind, the soul and the physique, inspire optimism and
joyousness through the brand and creating a difference that is more accountable than its
fellow competitors. The company envisions achieving the mission statements through the
aid of people, portfolio of products, their partners and the entire world that consumes its
products. Maintaining these will result in increased profits and productivity. The values of
the company include leadership, integrity, quality, accountability, diversity, and collabora-
tion (Stafff, 2016).
However, the current market scenario of the soft-drink brand is not in line with the
expectations of the top management authorities. Athavaley (2015) revealed that the chief
executive of the company politely refused the approval of $2.5 million bonus in the year
2014 while employees belonging to the top-level received very low compensation rather
than the expected. The reason cited is the struggle faced by the company in generating rev-
enues as the demand for the soft-drinks has declined in the last few years. These decisions
were termed as the steps to steer sales.The brand is more responsible in marketing products
to customers with special emphasis laid upon the healthy lifestyle of its consumers.The mar-
keting principles of the brand include different choice of products ranging from low calories
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to high calorie options. The marketing policies impart honesty in all activities even in speci-
fying the accurate nutritional value of the company’s products in the label of the product.
Further, no marketing campaigns or advertisements market the carbonated products to
children below 12 years of age (Coca-cola, 2016).
Segmentation is the key factor of success for Coca-cola.The concept aids in marketing
the product to customers based on the desire of the customers. There is no specific target
group for Coca-Cola but the products cater the needs of wide population. In the competitive
world, Coca-Cola uses different marketing strategies with the development and release of
new products into the market. While Cola products are loved by most of the people, for diet
conscious population ‘diet coke’ becomes the optimal solution. In this way, the company
positions itself in the global market amidst the other competitors (Coca-cola, 2016).
4. Task- III
4.1 Corporate Social Responsibility
Corporate Social Responsibility (CSR) is the term that relates to addressing the ethical
and moral issues which has impacts on the organisational behaviour and corporate decision
making perceptions. The concept of CSR relates to the extension of business contribution to
social context. Globalisation however becomes the birth-place for CSR operations wherein
the introduction of challenges and new opportunities due to economic, environmental and
social roles of the business is the result of globalisation. This further discerns the fact that
business operations should contribute to some extent for social causes. One main purpose
of CSR activity in an organisation is to make sure stakeholders are accounted by the firms
(Carroll & Shabana, 2010; Kemper et al., 2013).
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Figure 1: Pyramid of Corporate Social Responsibility
Source: Adopted from Carroll (1991)
Philanthropic responsibilities of Coca-Cola:
Since its inception, Coca-Cola has been delivering reasonable support to the local
communities in the countries in which it operates. The company is one responsible member
sharing the hardships of local community people and aids in providing a part of its revenue
to the society. The Coca-Cola Foundation was founded in the year 1984 as a philanthropic
organization and had partnered with various NGOs and Governments to aid in the develop-
ment of community people in four main areas: health and lifestyle, recycle and reuse, educa-
tion and water stewardship. Fund raisers were even conducted to provide relief to those
facing perilous situations during the time of disaster. The goal of the organisation is to sup-
port people with at least 1 per cent of the company’s income. The foundation has even
invested $76 million in 257 community organizations around the world
(Coca-cola Company, 2012).
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Ethical responsibilities of Coca-Cola:
The company strives to maintain consistency in all its actions. It maintains code of business
conduct to guide its employees to establish the values of the companies. In addition, any-
where the company establishes business, it adopts the rules and regulations of the nation
and the code of conduct of the company helps deliver standard operation across the globe
(Coca-Cola Company, 2016).
Legal responsibilities of Coca-Cola:
When a business organisation is required to operate in a country, it should comply with the
laws and regulations of the governing nation. This responsibility implies fair operation of
the business organisation (Fadun, 2014).
Economic responsibilities of Coca-Cola:
While the main motive of firms is to maximise the profit it earns, it should also be noted
that excessive accumulation of financial performance will not enthuse the stakeholders
(Fadun, 2014). Coca-Cola is stringent in maximising its revenue which is evident from the
crucial decisions it made to increase sales (Athavaley, 2015).
5. Task- IV
Coca-Cola was found to have contributed less to the soft-drink market during the recession
and even recovered very slowly in its home country. However, the company is expanding
its territories to new nations with the aid of low calorie carbonated drinks that become the
part of the brand. In the Middle East and Africa, the acquisition of Aujan aided the Coca-co-
la Company to take over the soft-drink market again. A comparison of the company with
its long term rival‘PepsiCo’revealed certain facts which are strengths to the rival company
and ‘Coca-Cola’ should strengthen its stance in the soft-drink market through innovative
products.
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The strategy of both‘PepsiCo’and‘Coca-Cola’are emphasising more on the health side
of its Aconsumers. In a country like UAE where the prevalence of diabetes and
cardio-vascular diseases is high, there is a need for diet-conscious products to be intro-
duced in the market. While‘Coca-Cola’focuses on increasing the coverage on non-car-
bonated non-alcoholic beverages, ‘PepsiCo’ had established ‘NutritionCo’ to integrate
nutritious food items such as snacks and dairy products as a part of the brand. In this
regard, PepsiCo invested large amount of capital to prove their dominance. This is in
specific shows the strengths of the rival organisation. In addition the market share of
sports and energy drinks of Pepsico is greater than that of ‘Coca-cola’ (Euromonitor
International, 2013).
6. Task- V
6.1 Analysis of Internal organisational strengths- SWOT analysis
Several factors drive the success of Coca-Cola in the Middle East countries, especially in
the context of the UAE. With the purview of analysing the critical factors of success
within the organisation and identifying its strengths and weaknesses, the SWOT analy-
sis is performed.
The SWOT analysis (Strengths, Weakness, Operations and Threats) is a business analysis
approach that is used to analyse the organisational performance in terms of business
operations performed on each of its deliverables (products/ services). This is an
approach of analysing the best way to achieve growth in the future (Team FME, 2013).
Figure 2: SWOT Analysis
Source: Adopted from Team FME (2013)

7. Task- VI
The residents of the UAE consume around 103 litres of carbonated drinks in a
year. It is also revealed that the UAE is the fifth highest consumer of soft drinks in the
world (Catchpole Communications Fz Llc, 2013). The predominant soft drinks that are
sold in the country are Coca-Cola, Pepsi and ZamZam.While the international soft-drink
giants are fighting for their position in the country, a local soft-drink company,
Strengths
1 The‘Coca-cola’company possesses strong financial capabilities to fund for marketing which is crucial for any
business operation. The company is valued to be around 80.3 billion U.S dollars in 2016 (Statista, 2016).
2 The Company is known to be one of the costliest brands in the world and holds the highest brand equity. It has
been awarded the highest brand equity by the Interbrand in 2011 (Interbrand, 2011) and the third highest brand
equity in 2015 (Interbrand, 2015).
3 Global presence- with around 200 + countries of operation.
4 Marketing strategies- targeting all age groups while its rival‘Pepsi’focuses only on youngsters.
5 Large distribution network worldwide
6 Even in times of downturn in specific regions of operation, revenue from other countries supports the company
balancing its income.
Weaknesses
1 Low product diversification- The Company highly relies upon carbonated drinks while its competitors are
growing in a slow but significant pace to establish predominance in the global market with different products.
The products of Coca-Cola are converged only within the soft drink industry while its competitor‘Pepsi’has new
wings: snacks, health-based foods and so on (Baah & Bohaker, 2015).
2 Water management issues- The Company faces lot of issues with water management. People in different coun
tries protest against the company’s vast consumption of water, leaving water scarce regions to drought
(Rogers et al., n.d.).
Opportunities
1 The company could emerge with new products that focus more on nutritional context. In UAE, diet and nutri
tion is gaining attention.
2 Focus of the company should be more upon developing countries. Developed countries are slowly moving
towards healthy drinks.
Threats
1 The competition between the rival companies is increasing day by day.
2 There are more products of the same brand‘Coca-Cola’with different names sold on the low-calorie range. This
leads to internal cannibalisation within the company (Euromonitor International, 2013).
3 Brands such as Café coffee day and Starbucks (UW Business School, 2003) are increasing day by day even in
developing countries. People are looking for alternative beverages other than soft-drinks. Health and energy
drinks market is inclining which may indirectly affect the market share of Coca-Cola.
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‘ZamZam Refreshment’ emerged in the year 2002 (ZamZam Refreshment, 2006) and
began expanding their boundaries all over the nation. The local pride of the country
used the opportunity of consumers boycotting U.S. based products and is now another
product in the soft-drink market of UAE.
An analysis of the top three soft drinks brands in UAE revealed the following positioning
map:
Figure 3: Positioning Map of soft-drinks in UAE
Source: Author (2016)
The positioning map reveals the company’s (Coca-Cola) position in the market with
other competitors. The products of Coca-Cola are sold at a relatively nominal price and
the quality in terms of taste is higher than that of PepsiCo and ZamZam products. How-
ever, the perceptual map of the products of the soft drink companies reveals a different
scenario.
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High quality
Low price High price
Low quality

Figure 4: Perceptual Map of soft-drinks in UAE
Source: Author (2016)
While the focus of Coca-Cola is majorly on carbonated and non-alcoholic bever-
ages, PepsiCo is expanding its operations to other wings of the food sector such as
snacks and energy drinks. There are diversified products sold by PepsiCo while the same
is lacking with Coca-Cola.
8. Recommendations
In the context of Coca-Cola and its perception to target the local population in
UAE, several changes should be considerably made to define its role in the target
market. Though the company suffers from serious threats with regard to the market
competition, the organisation is still in its peak at selling carbonated products. However,
the company’s strategies were focussed upon low-calorie beverages since UAE is now
focussing more on mitigating health issues arising out of high calorie foods such as dia-
betes and cardio-vascular problems. The rival company is striving hard to improve its
product portfolio with nutritional food items which is lacking in the case of Coca-Cola.
Increased choice of products
Junk
consumables
Health
conscious
products
Limited product choice
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Hence, the strategies of the company should be changed to increase the number of
healthy food products to increase the overall market sales of the company.
In UAE, there is an emerging trend of health all over the country. The country has
been idealised in several fields such as technology, infrastructure and so on. With the
ever-growing technology and the growth pace of the nation, chronic diseases are rising
which is due to reasons such as uncertain fast food habits. The products of Coca-cola
are mostly high carbonated drinks which are not a healthy diet. Strong recommenda-
tions are provided for the company to develop and market health conscious products
of the same brand.
However, marketing the products of a company plays a vital role for the product
to acquire market success. Though Coca-Cola adopts excellent marketing strategies to
attract consumers of all age, in a country like UAE which is turning more health con-
scious should look for marketing diet based products. Coca-Cola has a variety of diet
cola products. Marketing such products may increase sales. Further recommendations
such as introducing energy drinks, dairy products and health beverages may increase
the profit of the company. However, marketing should be done crucially taking into
account the health aspects of the country.
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