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In 1888, John Pemberton sold his interests to Within an industry sector it is possible to When diet Coke was first

When diet Coke was first launched in 1982

Coca-Cola - The Beginning Asa Chandler. Chandler formed The Coca-Cola plot the position of several similar Launch of diet Coke no one could have predicted the huge impact it
Company in 1892 and by 1895 Coca-Cola products on a product life cycle diagram. was to have on the marketplace. The initial
The history of Coca-Cola goes back to was being drunk in every state across For example, the diagram below shows the Another way to extend a product through its advertising campaign was carefully planned,
1886 when it was invented by Dr John America. As demand for the product grew, different types of drives that have been lifecycle is to adapt it as consumers’ needs with no expense spared – the introductory
Pemberton, in Atlanta, Georgia, USA. change. The example below illustrates how sixty-second commercial cost $2.5 million to
production was increased and it was made used in computers since the 1970s. You
According to legend, Dr Pemberton was computer drives were developed to adapt to make. By 1986 diet Coke was being sold in 61
available in bottles rather than just through may not have heard of the 5” drive but that countries with 60 million drinks sold everyday.
trying to develop a revitalising tonic and the soda fountain. The opening of bottling is because it is not available in most more technically advanced equipment. For
produced a thick brown syrup that he It was a phenomenal success.
plants in 1909 meant that all the elements computers today. At the other end of the scale diet Coke it was quite similar. It began in the
carried down the street in a jug to
were in place to launch a global brand. Little is a question mark because no one is quite 1970s when market research indicated that
Jacob’s pharmacy. It was sampled with
did Pemberton know the impact his mixture sure what new drives will be launched next. consumers’ attitudes to their diet and their
Brand Extension Strategy
carbonated water, pronounced ‘delicious
was to have on the soft drinks industry.
and refreshing’ and placed on sale for When companies with existing brands
five cents a glass as a soda fountain introduce new products under those brand
drink. In trying to develop the new Today Coca-Cola is located all over the names to the marketplace, this is known as a
product, Dr Pemberton’s partner and world. In Ireland they have concentrate brand extension strategy. A brand extension
bookkeeper, Frank M. Robinson, suggested factories in Drogheda and Ballina, and strategy offers a number of advantages. A
that two ‘c’s would look good in bottling plants in Dublin and Belfast. Here popular brand name gives the new product
advertising and penned the now famous the concentrate is mixed with carbonated instant recognition and immediate acceptance.
trademark ‘Coca-Cola’ in his unique water, bottled and sold. These businesses However, brand extension is not without risk. If
script. The first newspaper advertisement work hard to quench the thirst of the Celtic the brand extension does not live up to the
for Coca-Cola appeared in the Atlanta Tiger so much so that Coca-Cola holds a existing brand’s reputation then it could
Journal and invited thirsty citizens to 54% market share of the Carbonated Soft damage its image.
sample the new refreshing soda fountain Drinks (CSD) business in Ireland. Diet Coke is an example of a successful brand
drink. During the first year sales averaged extension because it has grown and established

Just a modest nine drinks a day! A total of 910 people are employed in
Coca-Cola businesses in Ireland. The
payroll to these employees is in the region
itself within its own right. Within a year of its
launch it was the biggest selling diet soft drink
in America and by 1987 it was the third largest
of £15m each year. But this is only a selling soft drink of any kind in the world.
fraction of the money that Coca-Cola
What is happening here is that new products health were changing. Coca-Cola conducted Diet Coke is now the world’s leading low-

for the contributes to the Irish economy. In

addition to wages, Coca-Cola spends
£50m on Irish raw materials and £25m on
Irish services, such as marketing and
are created as the technology improves.

What about the Coca-Cola brand? It has

careful and extensive research and as a
result identified an opportunity to develop a
product that would meet these changing
calorie soft drink, sold in a total of 149
countries with most of the sales being in the
USA, Britain, Germany, Canada and Australia.
Northern Ireland has the second highest per
transport. That represents £90m ploughed been around for over 100 years. How has it consumer needs. The identification by The capita consumption of diet Coke in the world.
back into the economy by Coca-Cola each maintained its leadership position even Coca-Cola Company of this unmet need with This is second only to the Cayman Island

taste year.

This case study will focus on the second key

brand in The Coca-Cola Company, diet Coke.
though the product has not changed in over
100 years? The answer is that Coca-Cola
are constantly developing the brand image
and reinforcing the core product benefits
consumers and the unique opportunity it
represented heralded the launch of diet Coke.
where the consumption of diet Coke is driven
by the high tourist industry.

It will examine how diet Coke was developed, of taste and refreshment to ensure that the
positioned in the marketplace and how the brand grows instead of declining.

of it advertising for diet Coke has developed as the

brand has evolved. One way Coca-Cola does this is to make the
product more accessible, ensuring that it is
always there to meet changing consumer
Product Life Cycle needs. For example, you would probably
never have tasted Coca-Cola if it had
The Coca-Cola formula has always been a remained available only over the counter from
well-kept secret and has not changed a soda fountain. Once the decision was made
through the years. In other respects, however, to bottle the drink then it became possible to
Coca-Cola has been constantly developing. This sell the product outside the main cities and
has been important in maintaining the brand indeed outside America. Years later the 330ml
in its number one position. It is quite natural can continued the growth and development of
for products to go into decline, at some stage, the brand. The 1990s saw the introduction of
after being introduced into a market. This is the 500ml screw cap bottle and the 2 litre
known as the product life cycle. The trick is contour bottle was launched in February
to delay this decline by constantly developing 1999. The lifecycle of the brand has certainly
the product and or the brand, to extend its been extended by making Coca-Cola more
Business 2000 lifecycle. accessible through new package forms.
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the key elements to be included in the for example, the new advertisement for Between 1990 and 1992 celebrities Researchers are able to imagine what diet
Positioning diet Coke advertisement that will appeal to potential
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were used to endorse the brand. Demi Coke would be like if diet Coke was a TASKS AND ACTIVITIES
consumers eg, music, humour, etc. Moore, Whitney Houston and Rod person. This type of character and
During a product’s life, a company will re-
Stewart all appeared in diet Coke personality definition is important when
formulate its marketing strategy many ■ Target Audience Describe the importance of the The
times in order to retain and drive
commercials during this time. making an advertisement and helps 1 Coca-Cola Company to the Irish
determine lots of things from the type of
consumer interest. Not only do economic Diet Coke advertisements target both men economy.
actors used, the music, the setting and the
conditions change but there are also new and women. In the years immediately after whole focus of the advertisement.
products being introduced by competitors. the launch women in their twenties were
The product will also pass through Draw a product life cycle diagram and
different stages of buyer and consumer
targeted but once the brand was well
Diet Coke 2 show where you would place each of
established the age range was extended to
interest and advertisers must respond to females between 18 and 35 years of age. Brand Personality the following electrical goods:
this. The male audiences for the campaigns are (a) black and white television
usually over 25 years of age. If diet Coke were a person, that person (b) colour television
A new product like diet Coke presents a (c) digital television
would be:
particular challenge to the advertising ■ fun (d) computer monitor
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department of Coca-Cola: How is it possible ■ independent (e) digital camera.
to position diet Coke so that existing sales of ■ sociable
Coca-Cola are not affected and new growth Archive Image
■ confident
is achieved? Outline the brand extension strategy
■ lively 3 for any other brand you know.
1994 saw the launch of the first “Break” ■ unafraid to show emotions.
The answer was to position diet Coke as the
style commercial. Both men and women
only soft drink that can give you great Cola
feature prominently in the commercial
taste with just one calorie. Previous diet and enjoying a break from their routine Positioning a product in the marketplace
low calorie drinks were only aimed at Summary 4 is very important. Describe how Coca-Cola
with a great tasting, low calorie
women but diet Coke emphasised the unique refreshment. met the challenge of introducing diet Coke
and refreshing taste benefits of diet Coke In 1897 The Coca-Cola Company’s main onto the world market.
right from the beginning and this appealed to In addition diet Coke commercials drink was Coca-Cola and it was not until
both men and women. The catchy theme focus on contemporary lifestyle and 1982 that the company extended the brand
song proclaimed that “you’re gonna drink it feature adults who are full of energy with the launch of diet Coke. Other brands From your reading of this study,
just for the taste of it.” and vitality and are living their life to in the Coca-Cola portfolio include Lilt,
5 demonstrate how Coca-Cola uses
the full. The advertisement illustrates Fanta, Sprite and their diet counterparts. both qualitative and quantitative market
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the good feeling one gets from research.
drinking diet Coke. Worldwide diet Coke has grown to be the
third largest brand in The Coca-Cola
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Company. The introduction of diet Coke Look at a recent diet Coke or Coca-Cola
strengthened the position of Coca-Cola as
6 advertisement and write a short note
the leading supplier of soft drinks in about the character and personality of the
Ireland. Over two-thirds of people who brands.
want a non-alcoholic drink choose a
■ Advertising Aim a few hours. Quantitative research is
carbonated soft drink (CSD) and over half
on a much larger scale and uses a
questionnaire to ask specific questions of those that choose a CSD select a Coca-Cola
The main aim of diet Coke advertising is
and in this way keep track of trends. brand. Quite often they choose diet Coke –
to communicate the unique product
Sometimes the researchers can get a just for the taste of it.
benefits of refreshing Cola taste with just
one calorie. However, the advertisement surprise.
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Advertising Campaigns must also communicate and portray other
elements such as the brand image, brand
■ Advertisements
The main objective of advertising is to name, people who drink the product, etc. As a result of continuously using market
project and communicate the brand image, research and understanding how consumers
drive awareness of the availability of the ■ Market Research attitudes towards products change this
product and in turn target and appeal to Character and Personality
information has helped diet Coke
potential customers. Advertising should Coca-Cola uses both qualitative and advertisements to evolve and develop
also create consumer interest in the brand quantitative research to judge and Companies very often give their products
over the years.
and persuade the potential customer to measure lots of different things from brand personalities in order to identify and
purchase. Market Research is an essential market share to consumers’ reactions Prior to 1990 the diet Coke commercials personify the personality of the consumer.
part of product development but also plays to different advertising campaigns. focused on adults enjoying the unique Over the years, diet Coke advertisements While every effort has been made to ensure the accuracy of
an essential role in the development of Qualitative research involves getting a and refreshing taste of diet Coke as have ensured that the brand has established information contained in this case study, no liability shall attach
to either The Irish Times Ltd or Woodgrange Consultants Ltd for
advertising in order to identify what are focus group of 2 – 8 people to discuss, part of their lifestyle. its own unique character and personality. any errors or omissions in this case study.

Business 2000