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TOPIC:
BCG MATRIX OF
COCa-COLA
COMPANY

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Credits

SR.N NAMES ROLL NO’S


O

1 NIRAJ BHAGAT 3

2 HARDIK PANCHAL 16

3 DHAIRYA PAREKH 20

4 RISHI PARMAR 21

5 CHIRAG RANA 27

6 NIKUNJ SHAH 36

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Acknowledgement
Any accomplishments requires the
efforts of many people and this work is
no different.The completion of the
project not only brings an appreciated
respite from many months of
demanding effort, but also provides a
welcome opportunity to acknowledge in
writing the soul who helped all along
the way, Miss Sweta who is our
STRATEGIC MGMT MAM who
provided overall guidence regarding the
project.Her help was willingly and
expertly given at the time of great
pressure and need, so we am greatly
thankful to her.
And, we thank all those who have
directly or indirectly helped us in
presenting the project.

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Index
Sr.n Particulars Pg.N
o o
1 About Coca-Cola Company 7

2 Products and Brands 8

3 Various Products World-wide 9

4 Brands Names Of Coca Cola 10


Products In India

5 PRODUCT THAT SELL MORE IN 11


MARKET ACCORDING TO
DISTRIBUTORS

6 BCG Matrix 12

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7 The BCG Matrix and the “one 16
size fits all strategies” notion

8 BCG Matrix of Coca Cola 18


Company

9 Other Uses and Benefits of 19


the BCG Matrix

10 Limitations of the BCG Matrix 20

11 Conclusion 21

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About Coca-Cola
Company

Atlanta, Georgia. Its stock is listed on the NYSE and is


part of DJIA and S&P 500. Its current president and
CEO is Muhtar Kent.

The Coca-Cola Company is the world's largest


beverage company, largest manufacturer, distributor
and marketer of non-alcoholic beverage concentrates
and syrups in the world and is one of the largest
corporations in the United States. The company is
best known for its flagship product Coca-Cola,
invented by pharmacist John Stith Pemberton in
1886. The Coca-Cola formula and brand was bought
in 1889 by Asa Candler who incorporated The Coca-
Cola Company in 1892. Besides its namesake Coca-
Cola beverage, Coca-Cola currently offers nearly 400
brands in over 200 countries or territories and serves
1.5 billion servings each day.

The company operates a franchised distribution


system dating from 1889 where The Coca-Cola
Company only produces syrup concentrate which is
then sold to various bottlers throughout the world
who hold an exclusive territory.

The Coca-Cola Company is headquartered in Atlanta,


Georgia. Its stock is listed on the NYSE and is part of
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DJIA and S&P 500. Its current president and CEO is
Muhtar Kent.

Products and Brands

The Coca-Cola Company offers nearly 400 brands in


over 200 countries, besides its namesake Coca-Cola
beverage. This includes other varieties of Coca-Cola
such as:

• Diet Coke (introduced in 1982), which uses


aspartame, a synthetic phenylalanine-based
artificial sweetener in place of sugar
• Diet Coke Caffeine-Free
• Cherry Coke (1985)
• Diet Cherry Coke (1986)
• Coke with Lemon (2001)
• Diet Coke with Lemon (2001)
• Vanilla Coke (2002)
• Diet Vanilla Coke (2002)
• Coca-Cola C2 (2004)
• Coke with Lime (2004)
• Aquarius Mineral Water (2004)
• Diet Coke with Lime (2004)
• Diet Coke Sweetened with Splenda (2005)
• Coca-Cola Zero (2005)
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• Coca-Cola Black Cherry Vanilla (2006)
• Diet Coca-Cola Black Cherry Vanilla (2006)
• Coca-Cola BlāK (2006)
• Diet Coke Plus (2007)
• Coca-Cola Orange (2007)
• Diet Coca-Cola with Citrus Extract (2008)

Various Products
World-wide

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Brands Names Of
Coca Cola Products
In India

• COCA-COLA

• THUMS UP

• SPRITE

• FANTA

• LIMCA

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• MINUTE MAID PULPY ORANGE

• MAAZA

• KINLEY

PRODUCT THAT SELL MORE


IN MARKET ACCORDING TO
DISTRIBUTORS

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9
8
7 8
6
SELL IN MARKET

5 6
4 5
3
2 3
1 2
1
0
T H U M S - S P R IT E C O K E M A A ZA F A N T A L IM C A
UP
P RODUCTS

BCG Matrix
The BCG Matrix method is the most well-known
portfolio management tool. It is based on product life
cycle theory. It was developed in the early 70s by the
Boston Consulting Group. The BCG Matrix can be
used to determine what priorities should be given in
the product portfolio of a business unit.

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To ensure long-term value creation, a company
should have a portfolio of products that contains both
high-growth products in need of cash inputs and low-
growth products that generate a lot of cash. The
Boston Consulting Group Matrix has 2 dimensions:
market share and market growth. The basic idea
behind it is: if a product has a bigger market share,
or if the product's market grows faster, it is better for
the company.

There are four segments of the BCG Matrix


(presented above) where the various products

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are placed in the portfolio of the company.
These are:-
1)Question Marks (high growth, low market share)

o Question Marks have the worst cash


characteristics of all, because they have high
cash demands and generate low returns,
because of their low market share.

o If the market share remains unchanged,


Question Marks will simply absorb great
amounts of cash.

o These products are in growing markets but


have low market share.

o Question marks are essentially new products


where buyers
have yet to
discover them.

o The marketing
strategy is to get markets to adopt these
products so as to convert them to Stars for the
company.

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o Question marks have high demands and low
returns due to low market share.

o These products need to increase their market


share quickly or they become dogs.

o The best way to handle Question marks is to


either invest heavily in them to gain market
share or to sell them.

2)Stars (high growth, high market share)

o Stars are defined by having high market share


in a growing market.

o Stars are using large amounts of cash. Stars


are leaders in the business. Therefore they
should also generate large amounts of cash.

o Stars are frequently roughly in balance on net


cash flow.

o Stars are the leaders in the business but still


need a lot of support for promotion
and placement.

o If market share is kept, Stars are


likely to grow into cash cows.

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3)Cash Cows (low growth, high market share)

o Cash cows are in a position of high market


share in a mature market.

o If competitive advantage has been achieved,


cash cows have high profit margins and
generate a lot of cash flow.

o Because of the low growth, promotion and


placement investments are low.

o Investments into supporting infrastructure can


improve efficiency and increase cash flow more.

o Cash cows are the products that businesses


strive for.

o Cash Cows are often the stars of yesterday


and they are the foundation of a company.

4)Dogs (low growth, low


market share)

o Dogs are in low growth


markets and have low
market share.

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o Dogs should be avoided and minimized.

o Expensive turn-around plans usually do not


help.

o Dogs must deliver cash, otherwise they must


be liquidated.

The BCG Matrix and


the “one size fits all
strategies” notion
The BCG Matrix method can help to understand a
frequently made strategy mistake: having a one size
that fits all strategy approach, such as a generic
growth target (9 percent per year) or a generic
return on capital of 9.5% for an entire corporation.

In such a scenario:

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• Cash Cows Business Units will reach their profit
target easily. Their management have an easy
job. The executives are often praised anyhow.
Even worse, they are often allowed to reinvest
substantial cash amounts in their mature
businesses.

• Dogs Business Units are fighting an impossible


battle and, even worse, now and then
investments are made. These are hopeless
attempts to "turn the business around".

• As a result all Question Marks and Stars receive


only mediocre investment funds. In this way
they can never become Cash Cows.

These inadequate invested sums of money are a


waste of money. Either these SBUs (Small Business
Units) should receive enough investment funds to
enable them to achieve a real market dominance and
become Cash Cows (or Stars), or otherwise
companies are advised to disinvest. They can then
try to get any possible cash from the Question Marks
that were not selected.

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BCG Matrix of Coca
Cola Company
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The BCG
C

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Other Uses and
Benefits of the BCG
Matrix
• BCG matrix helps a company to use the
experience curve to its advantage, it enables the
company to manufacture and sell new products
at a price that is low enough to get early market
share leadership. Once it becomes a star, it is
destined to be profitable.

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• BCG model is helpful for managers to evaluate
balance in the firm’s current portfolio of Stars,
Cash Cows, Question Marks and Dogs.

• BCG method is applicable to large companies


that seek volume and experience effects.

• The model is simple and easy to understand.

• It provides a base for management to decide


and prepare for future actions.

Limitations of the
BCG Matrix
Some limitations of the Boston Consulting
Group Matrix include:

• It neglects the effects of synergy between


business units.

• Market growth is not the only indicator for


attractiveness of a market.

• Sometimes Dogs can earn more cash than Cash


Cows.

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• The problems of getting data on the market
share and market growth.

• There is no clear definition of what constitutes a


"market".

• A high market share does not necessarily lead to


profitability all the time.

• The model uses only two dimensions – market


share and growth rate. This may tempt
management to emphasize a particular product,
or to divest prematurely.

• A business with a low market share can be


profitable too.

• The model neglects small competitors that have


fast growing market shares.

Thus, basically the BCG Matrix is useful for a


company to achieve balance between the four
categories of products a company produces. As a
particular industry matures and its growth slows, all
business units become either cash cows or dogs.

The overall goal of this ranking is to help corporate


analysts decide which of their business units to fund,
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and how much; and which units to sell. Managers are
supposed to gain perspective from this analysis that
allowed them to plan with confidence to use money
generated by the cash cows to fund the stars and,
possibly, the question marks.

Conclusion
Any strategic decision making exercise cannot be
successful unless the fact situation and the figures
have been taken account of and the taken
accordingly. The present attempt also follows the
trend. In a field exercise, pertinent data has been
collected as regards the different brands of Coca
Cola as being offered in India and based on the facts
collected, specific suggestions has been made for the
promotion of the brands which are not performing
well and also those which have already become the
power brands. The aim of the exercise was not to
highlight on the BCG matrix as such but to use BCG
matrix as a tool towards analysis of Coca Cola India
as an organization with all its products in particular

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as well as on a whole. Thus the suggestion generated
are all brand specific and pertain to the factors
behind each brand which contribute to its growth or
lead to its fall. Also, one important fact has been
witnessed by this study. It is not that organization
name which is all for a product. This is to say that
though Coca Cola is the leader is beverage products
in the world and has dominating brands in India as
well yet, its name is not sufficient to make all brands
a success even though they may be related to the
beverage business and thus within the core
competency of Coca Cola. It is essentially only
account of the fact that the present day consumers
are changing. The colonial concept of a big name
hides all has changed and unless the brand in
particular comes up to the expectation in the
subjective satisfaction of the consumer, it will not
succeed, not matter how big the name of the
organization is. Thus Coca Cola has to refocus on not
so well performing brands and taking each of them in
particular, in accordance with the plan of action as
well the highlighted technique, decide to reposition
its brands in the market. Escaping from the

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cumbersome task of repeating the observations
made herein, it is only advisable to state that the
present study has really come out with some glaring
defects in the strategy followed in some of the
products and Coca Cola has to revisit its plan of
action in order to convert its dogs and question
marks into stars.

Bibliography

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