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Coca Cola

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Li Chen

on 16 January 2015

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Transcript of Coca Cola

Final Summative Assignment
By: Li Chen
International Business
"Open Happiness!"
Created by a curious Atlanta pharmacist, Dr. John S. Pemberton, in 1886
Started of as a syrup that was added to carbonated water
Was sampled and approved by John's collegue, Frank M. Robinson, who later on created the name of the drink and it's distinct style of font, still used in the brand logo today
After the death of Dr. Pemberton, the Coca Cola soft drink became the #1 selling sparkling beverage and was popular in countries all over the world, which was due to the fact that the product was now being bottled

The Coca Cola product can either be a need or want depending on the situation you are in
Situation in which Coca Cola
is a
When you are at a theme park and the sun is beating down on you. You are trying to find a way to cool yourself down and decide to buy a cold cup of Coca Cola
Situation in which Coca Cola
is a
When you have not drunk anything for a whole day and is very thirsty. You may on the verge of fainting due to lack of hydration.
Good or Service
What is Coca Cola?
Coca Cola is a good. You can tell this due to the fact that Coca Cola is a beverage that can be seen or touched which is the requirement of a good.
Producer, Consumer or Customer?
The Coca Cola Company can either be in either of these positions depending on the situation
The Coca facotries where the ingredients are mixed together to make the infamous beverage which is then bottled to be sold in various venues.
Situation in which Coca Cola
is a

Situation in which Coca Cola
is a
When the Coca Cola factories use the bottling machines or other capital resources that the company had bought for them to use
Situation in which Coca Cola
is a
When the Coca Cola Company buys the ingredients needed to make the actual drink
When Coca Cola needs to buy ingredients from
other companies in order to make their product it is called
1.7 billion servings of Coca Cola are sold every day to customers all over the world
Coca Cola is partnered with big name organizations to provide worldwide aid, such as providing clean drinking water, jobs for developing countries and money to help with flood devasted countries. These organizations include:
World Wildlife Fund
Partners For A New Beginning
Inter-American Development Bank
Bill & Melinda Gates Foundation
International Federation Of Red Cross And Red Crescent Societies
Provides ingredients packaging and machinery
Must follow the Coca Cola Company's Supplier Guiding Principles which encourages the importance of responsible workplace and environmental policies and practices.
Satisfies the biological/physiological need in Malsow's Hierarchy of Needs
Economic Resources
Natural Resources
Human Resources
Capital Resources
Water, Sugar, Carbon Dioxide gas and other ingredients used to make Coca Cola
92,400 employees from all over the world
900 Coca Cola plants/factories
all over the world
Bottling machines, vending machines, conveyors and other machines used to bottle and make Coca Cola
When customers are buying Coca Cola products
the amount they buy is also considered
1.7 billion servings of Coca Cola is able to be sold
due to the company's
Change in Quantity Demanded
Change in Demand graphs
When the price of a 12 pack of Coca Cola goes
down by $5
This leads to a decrease in price, increase in quantity demaded and decrease in quantity supplied
When the price of one can of coke goes up by $2
This leads to a increase in price, decrease in quantity demaded and increase in quantity supplied
When the news says that Coca Cola rots your teeth
and increases diabetes
This causes the price of Coca Cola to go down and the quantity to go down as well
When BBC says that Coca Cola helps
you to relax and get your work done
This causes the price of Coca Cola to go up and the quantity to go up as well
Change in Supply/Quantity Supplied graphs
Price of sugar increases
This causes the price of Coca Cola to go up and the quantity to go down
Price of aluminum goes down
This causes the price of Coca Cola to go down and the quantity to go up
If the Board of Directors of Coca Cola or the Government decide to put a price ceiling, which prevents a price from going higher than a specific price, there would be more demand for the product than the company can supply. This means there will be a shortage of the product.
Price Ceiling
In this graph, you can tell that the quantity demanded is far greater than the quantity supplied which means that more people are demanding for the product than the company is supplying.
If the Board of Directors of Coca Cola or the Government decide to put a price floor, which prevents a price from going lower than a specific price, there would be less demand for the product than the company is actually supplying. This means there will be a surplus of the product.
In this graph, you can tell that the quantity supplied is far greater than the quantity demanded which means that more of the product is being produced than is actually being sold.
The higher demand for the Coca Cola product will cause an increase for derived goods as well as for complementary goods. The higher demand for Coca Cola will also lead to less demand for substitue goods like apple juice or lemonade.
Revenue - Cost= Profit
The price of a single serving of Coca Cola started of at 5 cents in 1886 and has risen to $1 as of now.
The price of a single serving of Coca Cola has risen by 95 cents which is a 1900% increase .
Percent increase calculated by
Consumer Price Index Equation
Revenue= How much the company sells one can at
Cost= How much comany spend to produce the can of Coca Cola

$1 - $0.50= $0.50 in profit
Profit will change due to changes in derived products and how far the can of coke is being shipped.
Business/Poduct Life Cycle
As of right now, Coca Cola is in the maturity stage, but at any time now the company may start going into a recession, as more people, all around the world, are becoming aware of it's effect on teeth and it's ability to cause weight gain.
Where Coca Cola is as of 2015
Gross National Product
Gross Domestic Product
Influenced by
Influenced by
All things made by Canadians
All things made in Canada
Any of the 6,300 people who work in one of the seven Coca Cola production facilities or other 43 facilities in Canada
Coca Cola produced by
Coca Cola produced by
Any Canadian living in a different country who works at a Coca Cola facility
Medium of Exchange
Standard of Value
Store of Value
(Using Coca Cola as a form of money would not be a good choice)
1.7 billion servings of Coca Cola is sold everday which means that it is not that scarce. This also means it does not ensure value.
Cans of Coca Cola are somewhat durable, but if dropped it may cause gases in the can to build up in pressure. This may eventually cause the can to burst open. Also, if you drop a coke can it will get bent and dented.
Coca Cola cans are not very portable as they are quite big and only one can could possibly fit in your pocket. Also, if you were to bring a lot of Coca Cola cans around with you, you would need a backpack or bag to carry all of them and even still there might not be enough room to fit them all in. Carrying a lot of Coca Cola cans is real heavy as well.
If you were to try and divide a Coca Cola can, you can't give half or a fifth of the can to pay for a product, as there would be no way of knowing how much is actually a half or fifth of a can and you can't slice it up or the drink will spill out onto the floor.
There is no way to determine how much a good costs by using Coca Cola cans. For example, if you were trying to buy a bicycle with Coca Cola cans, would you give 20 cans or 100 cans.
Coca Cola cans have no store of value because if you were to keep it to use later on, the can of Coca Cola would have gone flat, not carbonated anymore. Also if you were to keep Coca Cola cans for a long time, it would expire and it would no longer be drinkable.
Economic Systems
Coca Cola is a Market System
Decisions are made by the consumer and the business itself, such as the decision to make different flavoured cokes. The government has nothing to do with the desicions made within the company.
Produces whatever the consumer wants, like more tropical Coca Cola flavours or not. What consumers want changes from country to country.
Market Research
4 P's of Marketing
The Coca Cola Company uses Sun Trust banks to handle their accounts.
The Sun Trust bank is a schedule two bank as it is owned by the United States of America
The Coca Cola bottle has changed over time and has become easier to make, due to the updated/new machines.
Coca Cola dispensing machines have become more advanced and now have touch screens and can now hold more types of Coca Cola drinks you can choose from.
Using modern technology, Coca Cola is able to create different flavoured Coca Cola products.
Balance Sheet
Income Statement
Core Product
Actual Product
Augmented Products
Quenches a person's thirst
A sweet carbonated beverage
Brand Name
Coca Cola
Logo is neither a monogram, visual symbol or abstract symbol. The logo is just the Coca Cola name spelled out in a unique text type.
Coca Cola's slogan changes over time.
Some famous slogans are "Open Happiness" and "Catch the Wave".
Used to determine the next flavour of coke
Was used to create Coca Cola Zero, a healthier version of the famous product, as more customers were not buying their product as they realised it contained too much sugar.
Everyone buys Coca Cola no matter what age or gender they are.
People buy Coca Cola not only to quench their thirst but to get a taste of all the different types of Coca Cola they have out there.
More people by 12 packs of Coca Cola than one single can of it as it ends up being a lot cheaper.
Pepsi is not doing as well as Coca Cola in terms of sale, but it is trying to keep up with the Coca Cola company by introducing innovations of their product, such as Pepsi Next.
Better to do social media advertising or advertising on phones as more people are using phones or are constantly on social media.
Product is a red can of Coca Cola sometimes with different pictures on it such as polar bears, the Olympic events or the World Cup
The product is designed to hold a specific amount of Coca Cola whether it range from 355 mL to 2L
Shows the product size, which ranges from 355 mL to 2 L or even 12x 355 mL, depending on what you are buying.
Labelling on all Coca Cola products include the nutritional facts and ingredients.
Has increased from $0.05 to $1 due to the demand for Coca Cola over the years.
Price does not change over the holidays, stays the same as the price is already relatively cheap.
Can is shaped like a cylinder so it is easier to stack on top of each other. Can also helps keep all of the liquid together so that it doesn't spill and is easier to move around.
Nutritional Information
Features promoting the website
Protects liquid inside from getting polluted with dirt, germs and open air which would cause the Coca Cola to taste bad, make you sick or become flat
Brand Identification
The glass bottle the Coca Colais sold in and the red colour is proprietary design.
Helped influence the modern day image of Santa Claus.
Gave out coupons to get a discount off a Six Flags Park Admissions Ticket
Sponsor a lot of events, teams or shows, like American Idol or the Olympic Games
Coca Cola advertises on billboards, transit, bus stops and other public gathering places.
Coca Cola advertises on television in the form of commercials throughout the year. Their commercials are mostly seen during a major event or when they introduce a new flavour.
Some major events Coca Cola has advertised
during is a sports event called the Super Bowl
A popular Coca Cola commercial that was not
influenced by any major event took the form of a song
Coca Cola did start off advertising on the radio, but as technology rapidly evolved, they switched to advertising on television commercials. The visual aspect of advertising has a better effect as it makes your mouth water when you see the sweet bubbling liquid. Radio ads cannot give you this feeling as all you here is splashing.
One of the rarely heard Coca Cola radio ads
Coca Cola did start off with direct-to-home advertising, but as their popularity grew they no longer needed to send ads. People were telling each other about the great taste of Coca Cola which was faster and cheaper than printing and mailing ads
Coca Cola does occassionally put ads in newspapers and magazines but since more people have moved toward electronics. They have mainly focused on advertising online in the form of banner ads and in social media.
Coca Cola sells in wholesalers and retailers. Don't need to sell in importers as they have factories in all countries and can be found anywhere.
Coca Cola beverages are sold in vending machines all over the world.
Coca Cola makes both International and Domestic Transactions
Coca Cola has to deal with France's sugary soft drink tax which is 1 euro cent per can as France wants to lower their obesity rates.
Coca Cola sells it's products in all countries over the world.
Coca Cola subsidiaries include:
Mellow Yellow
Minute Maid
Pibb Xtra
and countless others
Total shareowners equity= 2,280,000,000
Has risen from 2012's shareowner's equity of 2,693,000,000
Important Points:
Important Points:
Income Statement is for year ended December 31 2013

Coca Cola has a gross profit of $2,862,000,000 which is less than the previous year ($2,900,000,000)

Coca Cola has a Net Income of $667,000,000
Autocratic Leadership
Coca Cola uses this type of leadership on the factory floor where the employees are controlled by their managers and need to follow the procedures made by the Coca Cola company.
Laissez-faire Leadership
Coca Cola uses this type of leadership if all their workers are meeting their Key Business Indicators, expecatations. If this occurs then the managers and directors can take this type of leadership style.
Democratic Leadership
This leadership style is used in the Coca Cola company when manager's at Coca Cola's bottling system provide vital information about the system. The company can then use this information and incorporate it into their strategy so that they can be more successful.
Category of Industry:
Coca Cola is a secondary industry as they are the ones who create the drink which is then sold at retailers and other channels of distribution.
Inventions & Innovations
Coca Cola
Coca Cola Cherry
Vanilla Coca Cola
Coca Cola Lime
Coca Cola Lemon
Coca Cola Zero
Diet Coca Cola
Orange Coca Cola
Rasberry Coca Cola

Fanta Orange
Fanta Fruit Punch
Fanta Grape
Fanta Lime
Fanta Strawberry
Fanta Peach
Fanta Raspberry
Fanta Cherry
Fanta Orange Zero
Sprite with Cherry
Sprite with Grape
Sprite with Peach
Sprite with Orange
Sprite with Vanilla
Sprite Zero
There are 127 innovations of Coca Cola's subsidiaries including diet versions as well.
To see all the innovations go to:
Business Ownership
Coca Cola is a public corporation
Coca Cola stocks are listed on the Stock Exchange
Which means ownership is as follows
Owners (shareholders)
Board of Directors
Muhtar Kent
Herbert A. Allen
Ronald W. Allen
Ana Botin
Howard G. Buffett
Richard M. Daley
Barry Diller
Helene D. Gayle
Evan G. Greenberg
Alexis M. Herman
Robert A. Kotick
Maria Elena Lagomasino
Sam Nunn
James D. Robinson III
Peter V. Ueberroth
CEO= Muhtar Kent
Beverage Industry
Coca Cola's competition in this industry is Pepsi
Coca Cola stock info:
Listed as KO
52 week low= $36.89
52 week high= $45.00
Stock cost= $42.63 (Wed. January, 2015)
Latest dividend was paid on December 15, 2014 and was a cash amount of 0.305
3 Year Summary
5 Year Summary
Both summaries show a gradual upward trend.
The Coca Cola Company lays of 2,000 employees
This causes the price of Coca Cola to go up and the quantity to go down
Focus Groups
Coca Cola should create a focus group concerning the different flavours/variations of their product. Since there are so many variations, Coca Cola should get their customer's opinion on each of them. If there is one flavour that no one likes, then Coca Cola could stop wasting money on that product and then start using it on getting new technology or maybe starting a new variation, like maybe pear coke or mango coke.
Influenced by
Revenue= $35.119 billion
Full transcript