International Marketing Mix
Since 1900, Coca-Cola already moves into Europe market, when 1970 Coca-Cola moves to international market, it already 39 years ago until 2009. After 39 year, Coca-Cola has modified their product to international marketing and they used marketing strategy to build up their market. (http://heritage.coca-cola.com/) Nowadays ,Coca-Cola which already operating in many country as a multinational company.
Marketing mix is the key element of Coca-Cola to set up business in international market, and the marketing mix include four pices was product, price, place and promotion.
In international market, Coca-Cola major focuse to using marketing mix to built their business, however,Coca-Cola also have using certain part of “PEST” startegy to their marketing mix startegy. PEST is a external analysia theory to mention about the general enviorment influences to firm and how the firm to resist it.
The Introduction of Core Product of Coca-Cola
Coca-Cola product planner need to think about the product of the three basic level. From the graph shows that, the core product of Coca-Cola, which is how the product satisfied their consumer. The second level of actual product of Coca-Cola is how Coca-Cola to develop the product and services features, brand name and packaging. The last level of argument product of Coca-Cola is around the core product by offering additional consumer services and benefit, (author Gary Armstrong& Philip Kotler (pg232).
The Currently Ways of Coca-Cola Using In International Marketing Mix -Product
The first marketing strategy of Coca-Cola using in Malaysia is product. Coca-Cola is a famous soft drink product in Malaysia market, their packing outlook, is easy to attract consumer. Nowadays Coca-Cola beverages drink on the current markets has varieties of choices (Refer to appendix 1), that are selling in Malaysia (http://www.thecoca- colacompany.com/brands/index.html). Coca-Cola using three strategy to built up their product image, it was product branding, packaging and labeling, (Gary Armstrong& Philip Kotler 2007,pp238, 239).
Branding which is a key element of Coca-Cola, to build up relationship with their consumer. Brand was representing Coca-Cola to give the first impressions to their consumer perceptions and feeling about their product, so, it was an important part to build Coca-Cola product. (Gary Armstrong& Philip Kotler(pg242) In addition, the constituents of branding which include both tangible benefit such as quality and reliability, moreover, intangible benefit may bring out whole range of feeling like status being fashionable or possessing good judgment by purchasing a particular brand. (Isobel Doole and Robin Lowe) Therefore, this is the reason why Coca-Cola emphasis on branding that helps to Creates “brand awareness” among the consumers and brings out the feeling of possessing good judgment so that the brand is very successful in Malaysia market.
The packaging of Coca-Cola using in Malaysia market, is light red in color to be on the surface of product, they using aluminum tin to be soft drink material and plastic bottle. (http://www.thecoca-colacompany.com/brands/index.html).
Labeling was a range from simple tags attached to product complex graphic that be a part of the package, and where the product made and how to use it are safety .( Gary Armstrong& Philip Kotler (pg239) The labeling of Coca-Cola using in Malaysia market, was to identify the product using material and ingredient.
Furthermore, the labeling show that Coca-Cola to confirm as a ‘Halal’ drink product at Malaysia cultural refer to (appendix 1.2), it base on an external analysis theory of Michael Porter ‘PEST’ social strategy (Stuart Wall &Bronwen Rees2004).
As mentioned above, the reason is Malaysia as a Muslim country the government control food or drink production very serious, therefore; the labeling of ‘Halal’ is very important in Malaysia market.
The Currently Ways of Coca-Cola Using In International Marketing Mix-Price
The second marketing strategy of Coca-Cola using in Malaysia is Price. Price is the element in which of Coca-Cola Company use and it was the amount of money charge for the product. (Gary Armstrong& Philip Kotler pg 291) Coca-Cola set up the pricing in Malaysia market, which is using normal and fair pricing to attract Malaysia consumer, refer to (appendix 1.3) show that the four types Coca-Cola selling price on Malaysia market. The way of the price that affects demand of Coca-Cola is influence by some factor like elastic demand and inelastic demand.
Refer to graph (1) show that elastic demand of the price was sensitive; so, the sales volume increase significantly as price is reducing. (Isobel Doole and Robin Lowe pg386) Otherwise, refer to graph (2) inelastic demand mean the product is under have no increase, decrease correspondingly with a fall, or rise in the price. (http://www.businessdictionary.com/definition/inelastic-demand.html )
Graph (1.1) Elastic Demand Graph (1.2) Inelastic Demand
As a result, refer to graph (1.1) Coca- Cola was under elastic demand product, so they set the price are base on Malaysia market direction. Before Coca-Cola set up the price, they need to determined suitable for pricing in international market and consider the options available in setting individual prices.
By contrast, Coca-Cola setting their price which to base on stabiles the competitive position within the market, to penetrate the the market by adopting an aggressive strategy to increase market share, to reflect differences in the perceived value and performance of competitive product and prevent or discourage new entrants in the market, according Isobel Doole and Robin Lowe (2008). As mentioned above, graph (1.1) show that Coca-Cola is sensitive of price changes in Malaysia market. Because Malaysia market has several of the soft drink competitors refer to( appendix 1.4) , and their product price which under RM1-RM2 in Malaysia market; hence, if Coca-Cola set up their price above from competitor, the consumer can easily substitute to other product, so that Coca-Cola has to set the price around competitor price in Malaysia market.
The Currently Ways of Coca-Cola Using In International Marketing Mix- Place
The third marketing strategy of Coca-Cola using in Malaysia is Place. Place, which is important section area of Coca-Cola to operating their market. Due to place is concerned with various methods of transporting, storing goods, and then making the product available for the customer, hence it getting product to the right place at the right time involves the distribution system. Furthermore, the choice of distribution method will depend on a variety of circumstances and be more convenient for some manufacture to sell to wholesalers who then sell to retailers, while others will prefer to sell directly to retailers or customers. (http://www.thetimes100.co.uk/theory/theory–marketing-mix-(price-place-promotion-product)–243.php )
Coca-Cola was using the transporting system to sending their product to the selling place in Malaysia market. Otherwise, Coca-Cola also set up some soft drink machine around the bus station to let consumer easy to get there product. Because Coca-Cola set up soft machine around public places; so, it may let Malaysia consumer easy to find their product.
Coca-Cola corporate with F&N Company, become F&N Coca-Cola (Malaysia) Sdn Bhd to set up factory to manufactures and distributes soft drinks in Malaysia. (http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=6464014 ) In addition, Coca-Cola that is using 7-11 stores, hypermarket and retail supermarket etc, to distribute product. Because Coca-Cola corporate with Malaysia businessperson to selling Coca-Cola, so, the businessperson may also indirectly let Coca-Cola, have place to sell their product in whole Malaysia. Otherwise, Coca-Cola may also using Cinema and restaurant being places to selling their product in Malaysia market. Due to Coca-Cola using hypermarket store and restaurant to promote their product, hence, it was a best place to sell their product in Malaysia market.
The Currently Ways of Coca-Cola Using In International Marketing Mix- Promotion
The last marketing strategy of Coca-Cola using in Malaysia is promotion. Promotion is an important element to helping Coca-Cola set up operating in Malaysia. Promotion major function, that is to promote and communicating with the public and to influencing consumer toward buying products or services. (http://sbinfocanada.about.com/cs/marketing/g/promotion.htm) According to Gary Armstrong& Philip Kotler, claim that promotion as a promotion mix that include advertising, sales promotion, public relation, push and pull strategy.
Firstly, the promotion mix of advertising that was any paid from of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor. In addition, advertising can reach of geographically disperses buyers at low cost per exposure, and it enable the seller to repeat a message many times (Gary Armstrong& Philip Kotler 2007pp387). Coca-Cola was successfully to promote their advertising in Malaysia, because they using television media, newspaper, magazine and internet media to publish their product and repeat many time to consumer, so, Coca-Cola to establish a good promotion by advertising. Such as, Coca-Cola will using Malaysia culture and lifestyle to be advertisement title to showing Coca-Cola have good relationship with Malaysian. In under developing country Coca-Cola practice radio and newspaper to advertising their product. The reason is under develop country was poverty, hence, Coca-Cola using radio and newspaper to promote their product. Coca-Cola except using radio and newspaper to promote their product in under developing country, they also can use signboard to advertise Coca-Cola.
Secondly, the promotion mix that of sales promotion that mean short-term incentive to encourage the purchases or sale of a product. Otherwise, sales promotion that was include a wide assortment of tools such as coupons, contest, cents-off deals, premiums and other which have many unique qualities. Because of sales promotion are attract consumer to attention offer strong incentive to purchases; therefore, it can increase the sale volume. (Gary Armstrong& Philip Kotler) Malaysia is multiple nations and the Malaysian has different culture festival to celebrate, so; the best period of Coca-Cola to use sale promotion strategy in Malaysia market is when they celebrate their festival.
Otherwise, Coca-Cola corporate with MacDonald to sell the soft drinks with its popular burgers and fries, and the handshake still covers the Coca-Cola “contract” with McDonald, therefore; Coca-Cola are indirectly to promote their product to Malaysia consumer. (http://www.marketwatch.com/story/mcdonalds-shakes-up-coke-tries-new-drinks )
Thirdly, the promotion mix of public relationship means the public relationship is very believable like news stories, features, sponsorship, event it seems more real and believable to readers. Otherwise, public relationship may also be able to reach many prospects that avoid salespeople and advertisements, as the message gets to the buyers as “news” rather than as a sale- directed communication. (Gary Armstrong& Philip Kotler) Coca-Cola was using new story and sponsorship to promote their product in Malaysia market. When there is any sport game competitions, Coca-Cola will be a sponsorship to sponsor the sport team. In addition, Coca-Cola may also create news stories to let Malaysian know well they product.
On the other hand, marketer can choose from the two basic of promotion mix to be ‘push’ and ‘pull’ strategy on promotion. The relationship emphasis on the specific promotion tools differs for push and pulls strategies. Push strategy that include pushing the product through marketing channels to final consumer and the producer directs its marketing activities like primarily personal selling and trade promotion, however; pull strategy was make the producer directs its marketing activities like primarily advertising and consumer promotion toward final consumers to include them to buy the product. (Gary Armstrong& Philip Kotler 388)
Coca-Cola was choosing the advertising and public relationship to practice in push and pull strategy in Malaysia market. In advertising Coca-Cola was using pull strategy, like television media, magazine to promote their product. Due to pull strategy are make Coca-Cola successfully directs marketing to primarily advertising in Malaysia market, hence, it attract consumer to buy their product (Gary Armstrong& Philip Kotler). Because Malaysia is developing country and the Malaysia consumer have economic power to purchases television, so Coca-Cola pull strategy of using television media to advertise their product is benefit affect to Coca-Cola.
By contrast, Coca-Cola using push strategy in public relationship, of sponsorship to sport game competition or charity activity to promote their product. Because of push strategy was include pushing the product in marketing channels to final consumer and Coca-Cola can directs to do marketing activities in Malaysia market, like primarily personal selling and trade promotion; so, push strategy may help Coca-Cola achieve more promotion result. (Gary Armstrong& Philip Kotler) Due to Coca-Cola was using push strategy of public relationship to do charity activity and event to attract Malaysia consumer ,so, Coca-Cola can more easy to promote their product in those activity.
Suggest Any Changes of Coca-Cola that Might Make to the International Marketing Mix over the Next Few Years
The first suggestion in international marketing strategy of product using Coca-Cola in Malaysia market for the coming years is where Coca-Cola may focus in the changes of “Green issue” of the packaging material. Because nowadays some producer is practicing “Green issue” in their operation; so, Coca-Cola may also practice green issue in the packaging of the product. Coca-Cola can promote the green issue knowledge to Malaysia consumer and sending the message that Coca-Cola product is advocate in green issue and their product can be recycles. In addition, Coca-Cola can use rewards method to attract consumer to join green issue activities in Malaysia market where if any consumers who join the recycle activities, they can get one free Coca-Cola by recycling ten empty aluminum tin of Coca-Cola. Furthermore, Coca-Cola also can corporate with hypermarket to promote, reclaim the soft drink plastic bottle and aluminum tin.
The second suggestion in international marketing strategy for price of Coca-Cola in Malaysia market for the coming years where, Coca-Cola can produce low calorie of Coca-Cola to attract consumer and the price is same as original Coca-Cola. In addition, Coca-Cola also can produce mini size Coke to consumer and set the price under RM0.50 in Malaysia market to attract their customer.
The third suggestion in international marketing strategy for place of Coca-Cola in Malaysia market for the coming years where Coca-Cola can put more soft drink machine around the public places to let consumer easy to find and buy it there product, like put at college, shopping complex and taxi station.
The last suggestion in international marketing strategy for promotion of Coca-Cola in Malaysia market for the coming years, where Coca-Cola can using discount voucher to attract consumer buy more their product, for example purchase 12 bottle get 2 free Coke. Otherwise, Coca-Cola may able to using gift to be focal promotion to attract consumer to purchase their product, for example buy one boxes of Coca-Cola can get Coca-Cola limited edition gift. Coca-Cola can corporate with Malaysia hypermarket to conduct lucky draw activities and event to attract Malaysia consumer to purchase their product. For example, when consumer purchases Coca-Cola they may have chances to join the lucky draw competition to win cash or expensive gift.
As a conclusion, Coco-Cola is a high potential product in Malaysia market and they were successful to using currently marketing mix to apply in their product. Otherwise, for the coming year Coca-Cola add on the future change marketing mix strategy to their product it may decline to high level position and the Coca-Cola sales revenue may also increase more in Malaysia market.