Sales Promotion and Public Relations - Case Study Example

MARKETING COMMUNICATION Student’s Name: Code + Course name Professor’s name University City, State Date Executive Summary The Coca cola Company has portrayed market dominance in the soft drinks industry ever since its establishment in 1886. At the time of its establishment, the company manufactured, bottled and distributed sugar carbonated soft drinks. Towards the end of the 20th century, the company encountered numerous health concerns associated with the consumption of the Coke product. Health organisations attributed the product to obesity and negative effect on the teeth of children thereby necessitating the urge of manufacturing “healthy” drinks. The launch of the “Diet Coke” brand in 1982 was the major milestone of the company in responding to the changing consumer preferences regarding soft drinks. The introduction of the “Coca Cola Life” product was the firm’s major milestone in developing a healthy coke product having a green packaging to appeal to the “green” consumer. The company has launched and marketed the product in the UK and US (2014) and New Zealand (2015) to satisfy the needs of health-conscious consumers that prefer the refreshing taste of coke products to its competitors. Table of Contents Executive Summary 2 Introduction 4 The Coca-Cola Life Brand 4 Segmentation 5 Targeting 5 Position 6 The Marketing Communication Plan for the New Product 6 The Marketing Communication Tools for the Coca-Cola Life Brand 8 The Budget 14 Conclusion 14 Reference List 15 Appendices 16 Introduction The Coca Cola Company is one of the largest manufacturers of soft drinks in the world (Bell 2004). Besides being a manufacturer of the non-alcoholic beverages, the company also distributes and markets its products. The Coca-Cola is the flagship brand of the company. As a strategy of maintaining competitive advantage in the industry, the company has decided to launch a marketing campaign for the Coca Cola Life brand after conducting a pilot test on the product in Argentina and Chile in 2013. The ‘healthy soda’ uses stevia, a natural sweetener to achieve a 36% reduction in the product’s calorie content. It turns out to be one of the healthiest brands in the Diet Coke range (Dunn 2015). The report provides a critical review of the initial marketing campaigns associated with the “Coca Cola Life” brand. The second section of the report recommends the most feasible marketing communication techniques that the company can utilise in creating awareness about the new product. Finally, the report provide an agency brief that details the future campaign of the brand. The Coca Cola Life Brand The launch of any new product in the market necessitates substantial marketing communication efforts to create awareness about the product to the target audience. In March, 2015, the company introduced another brand in the Diet Coke line of products known as the Coca Cola Life. The product contains Stevia, a sweetener obtained from plants that has enabled it to achieve a 35% reduction in the sugar concentration of the conventional Coke products. This time around, the company endeavoured to design a universal product appeal that would attract both male and female customers. The Coca Cola Life is one of the products in the Diet Coke line of products. Segmentation It is evident that the company has segmented the coca Cola Life product on the bases of demographics, geography and psychographics. The demographic segmentation of the Coca Cola Life product emanates from the decision of the company to target health-conscious consumers aged between 35 and 55 years. Apparently, obesity presents itself to the age cohorts to a much greater extent as compared to the younger population. Geographically, the decision of the company to start the marketing campaign of the product in Chile and Argentina, followed by the UK, Australia and the USA reveal that the firm has also segmented the product on the basis of geography. Apparently, the countries have reported higher cases of obesity thereby necessitating the need for the company to introduce the life product to cater for their needs of a naturally-sweetened Coca Cola product. On the basis of psychographics, it is evident that brand –conscious consumers would still prefer to consume drinks from trusted companies such as Coca Cola rather than opt for health drinks from other firms. Therefore, keeping the trend in mind, Coca Cola introduced the life product to avail the health product in its product portfolio so as to enable its brand-loyal consumers to continue using its product. Targeting The Coca Cola Life brand targets health-conscious consumers aged between 35 and 55 years that are on the lookout for naturally sweetened lower-calorie cola (IBD 2014). The strategic targeting is evidenced by the fact that the company has already introduced the product in Argentina and Chile, countries that exhibit the highest cases of obesity incidences. Therefore, the company intends to lure the health-conscious consumers of the other health-conscious consumers into opting for the Coca Cola Life as their ultimate choice of a beverage as they endeavour on developing bottles entirely made of plant material. Position The need for natural drinks explains the decision of the Coca cola Company to introduce the Coca Cola Life mid-calorie product in response to the launch of a similar brand by Pepsi in 2012. The company understands that there has been a decline in the demand for soft drinks in the American market as a result of the increasing cases of obesity. For instance, the demand was 201 litres per individual in 1998 as compared to the 167 litres per person demand currently. People have resorted to water as their favourite drink in the market. As a result, the introduction of the Coca cola Life brand implied that the company had shifted on the trend rather than the brand since its brand operates on the principle of energy, refreshment and enjoyment as opposed to being healthy. Therefore, a green brand image for the Coca Cola Life is an indicator that the product is fresh in nature. It is very nice to see a green wooden crate containing a few bottles of Coca Cola Life beverages with a haze of green grass in the background (Maandag 2015). The decision of the company to choose the name “Life” implies that the firm saw the need of making the mid-calorie product to be the most preferred product in the market since nothing can beat “Life”. The health-conscious consumers prefer life drinks to the other conventional beverages. Therefore, the use of Stevia, a natural sweetener in the manufacture of the Coca Cola Life brand targeted to position the mid-calorie brand above its competitors especially Pepsi. In essence, it is proper to state that the introduction of the Coca Cola Life brand signified a total change in the direction of the firm’s product portfolio (Maandag 2015). The Marketing Communication Plan for the New Product The company launched the marketing campaign for the Coca Cola Life product in Britain in 2014 and has since endeavoured to launch the product in other countries as well. Therefore, widening the market of the brand through the adoption of proper product marketing tools is the major objective of the communication campaign. The other objectives of the marketing campaign encompass To develop a global approach of marketing the product to both men and women. To communicate the health benefits associated with the utility of the product During the launch of the product in the UK, the company utilised a huge marketing campaign that consisted of OOH, experiential, digital and print support as the tools of the campaign. The primary rationale of the company targeted creating the awareness of the green Cola product to its British market. The new diet product turns out to be the best option available to health-conscious consumers in matters pertaining diet products. The marketing of the new product targeted adults that intended to utilise a lower calorie option while consuming soft drinks. The marketing campaign used a media campaign that had a mass appeal with the intention of creating brand awareness to many people with immediate effect. The eye-catching campaign highlighted the fact that the product consisted of a sweetener sourced from natural resources to attain lower levels of calorie as required by the health-conscious individuals in the market. Figure 1 in the appendix shows the Coca Cola Life advert comprising of both the green packaging and additional information about the product. The firm also used a green packaging to achieve a positive appeal to customers that have exhibited preference towards consuming green products rather than using unhealthy ones. The blend of the stevia leaf extract and sugar that forms the Coca cola Life brand resulted in the reduction of the calorie content by one third. In the UK, the multimillion marketing campaign ran from September until the end of October. The campaign also used outdoor advertising that emphasised on proximity. As a result, the firm used computer and iconic digital screens, buses, 6 sheets and 48 sheets. The company used digital and print media to support the campaign. Creating the awareness of the product also utilised shopper market activities and commuter hub sampling. The campaign focused on three main objectives: trying out the new product in the British market, creating awareness of the product and informing consumers about the product intrinsic that encompassed informing consumers that the new product contained natural sweetener and had lower calorie as compared to its predecessors. The OOH campaign encompassed over 7,000 sites including underground, train and bus stations and roadside campaigns. The campaign also activated target digital panels on specific train commuting spots and roads with the intention of creating awareness regarding the diet product. The initial marketing campaign targeted to lure customers into trying out the new product as an alternative to the rival brands; particularly Diet Pepsi. The sensitivity exhibited by consumers pertaining the reduction in calorie content and the use of recyclable and organic materials in the development of the packaging material compelled Coca Cola Great Britain to avail information about the sensitive aspects during the launch of the product. For instance, the packs used by the company are 100% recyclable. In fact, Coca cola Britain used recycled materials consisting of 22.5% plant materials. The campaign also revealed that the product contained 36% less calories resulting in an equivalent reduction in the sugar intake. The company also revealed that it had used 46% recycled aluminium to make the 330ml cans. The Marketing Communication Tools for the Coca Cola Life Brand Advertising Advertising is still appropriate for the new brand of the company. However, the company can decide to borrow from the “Tort” advert in the quest to make the product appeal to both men and women. Adopting the right forms of advertising would promote the new product by creating its awareness in the market. The different forms of advertising that the coca cola Enterprise can use to communicate its new product to consumers encompass a) Billboards The major advantages of the billboard would be the guarantee of high reception, large and conspicuous presence in the selected areas. Moreover, placing a “powerful” ad on a billboard would guarantee attention from all passers-by thus guaranteeing the communication of the message. It is also difficult to ignore ads placed on billboards (Gulmez, Karaca & Kitapci 2010). However, it is important to observe that the technique dates back to olden days. Therefore, consumers have devised ways of ignoring the adverts posted on billboards. It is worth noting that the company has utilised billboards before in its advertising strategies using neon displays. Moreover, the firm has utilised 3D billboards in the USA. b) TV Adverts Apparently, the adverts are a good communication approach since the company can target to air them before and during specific programmes. Consequently, the firm will be in a position of reaching a large audience comprising of both men and women. The firm can integrate the advert in its Christmas adverts to ascertain that consumers consider the healthy drink as their mainstream choice in their New Year resolutions. c) Newspaper/Magazine The ability of newspapers and magazines to target specific populations is the greatest advantage associated with the use of the form of advertising. Moreover, the readers of the adverts placed on newspapers and magazines are highly receptive (CARIMAC 2011). It is proper for the company to integrate the captivating advert in the health sections of newspapers and magazines so as to catch the attention of health-conscious individual. d) Public/Street Furniture The ability of street furniture to target a large audience is the main advantage attached to the utility of the form of advertising (Warner 2003). Therefore, the positioning of the adverts in specific places and events plays a pivotal role in marketing the brand of the company. Apparently, the company exhibits utmost devotion to social responsibility by holding football leagues and sponsoring major tournaments such as the Olympics. Consequently, it can place the advert of the new product on the streets and furniture in the regions that host the major tournaments. e) Online advertising Online adverts are effective in targeting specific websites that host many users. The company can modify the “Tort” advert to depict individuals that have benefited from consuming the Coca Cola Life product as compared to those that maintained the consumption of the regular sugar carbonated drinks. Moreover, online adverts require fewer finances and stand out as good communication channels (Bruneau 2011). Personal Selling Personal selling necessitates constant communication between the distribution channels and the existing workforce of the company. It is evident that the Coca-cola Enterprise distributes vending units and cooler fridges to shops, sports halls and community centres. The firm also targets to introduce the liquid dispensing vending unit that the distributors will use on board their trucks (Popoya 2010). However, it is worth noting that the company should introduce additional incentives to lure its customers and distributors into remaining loyal to its products. Sales Promotion The different forms of sales promotion encompass price deals, loyalty rewards programmes, coupons, online interactive promotional games, online couponing and contests. i. Price deals They refer to deals between the enterprise and its customers and/or distributors that target to reduce the price that the company charges for its concentrates or final products. The decision of the company to offer price deals to customers that intend to purchase the Coca Cola Life product is paramount to the success of the advertising campaign. The major advantage associated with the use of price deals include the great response from the consumers in areas where the company does not have guaranteed customer loyalty (Palazon & Delgado‐Ballester 2009). ii. Loyalty Rewards Programme The company may implement a programme that allows consumers to collect credit, milestones and points whenever they make purchases of the company’s products. The customers can redeem the points for other rewards offered by the company. The main merit of the strategy heightening the brand loyalty of consumers and customers to the product so as to benefit from the rewards (Gedenk, Neslin & Ailawadi 2006). However, it is imperative that the company should advertise about the scheme to create awareness among in the consumers and customers. iii. Coupons Even though it is an outdated form of sales promotion, the company can still use the strategy to lure consumers to make purchases in the local distribution stores. They are effective in sales promotion since they motivate consumers to purchase a product that they did not have before. The failure of the strategy to guarantee brand loyalty is the major weakness associated with coupons (Cuellar-Healey 2013). iv. Online Interactive Games The Coca cola Enterprise can develop online interactive games that entail the consumer playing an online game about the promoted product. The major merit of the form entails its ability to keep a customer on the website thus guaranteeing customer loyalty. Moreover, the customer can inform another friend about the game thus reaching a wider target. However, the option only applies to a specific market audience since not all customers can play online games. v. Online Couponing The company can also avail coupons online thereby requiring consumers to print them and take them to the physical stores. The merits of the form of sales promotion concerns its exclusiveness as compared to in-store coupons. Moreover, it encourages a customer to stay on a website thus yielding brand loyalty. However, the strategy requires cooperation between the company and the distributor for its effectiveness. vi. Contests and Games The firm can enrol consumers into the contest whenever they purchase the healthy product. In order to encourage repeat purchases, the company can attach good prizes to the products. However, consumers believe that large brands such as Coca cola have many consumers. Consequently, the chances of winning are slim on the part of the contending consumer. With the understanding in mind, consumers may shy away from taking part in such events. Direct Marketing The simplicity associated with measuring the effectiveness of direct marketing suffices to be the main advantage associated with the strategy. For instance, the company can determine the number of successful adverts from the number of adverts that it sends out to potential consumers. Direct marketing also enables a company to maintain a track of its online promotions thus providing an easy platform for the determination of the degree of attainment of the firm’s objectives (Burnett 2012; Mai 1997). Recommendations A combination of the company’s adverts on healthier drinks and its social responsibility in sponsoring major sporting events will heighten the reputation and image of the Coca Cola Life brand. In the case of online advertising, the company should require consumers to subscribe to email alerts before sending emails about the new product. The company can also upload the TV adverts on YouTube to target a larger group. It is also proper to consider price deals and the loyalty rewards programme in the marketing communication plan as they will serve to encourage consumers and customers to purchase the product. The company can combine online coupons with the Coke’s Digital Music Store to gain customer and brand loyalty. It is also proper for the company to use interactive online ads to create awareness of its diet products and encourage consumers to make purchases. This may include creating a Facebook page that will allow consumers to post their feedback regarding the company’s products. Consumers can also post recommendations on Twitter, fourscore platform, Facebook and the company’s website that may be pivotal towards marketing its new products especially the Coca Cola Life. In order to enhance the experience of users with the new vending game, the company can use a flash game. Furthermore, the company should hold contests encompassing all companies associated with the Coca cola Enterprise and competitions for winning tickets to major sporting events sponsored by the company. It is also imperative that the company should respond to the Child Labour accusations released by Channel 4. The response may entail producing a broadsheet paper article about the sustainable diet product. The article should detail the reusable packaging and sustainable production and materials used in the new product and the dedication of the company towards reducing the carbon footprint. As a response to the press release concerning the contribution of its drinks to child obesity, the company should develop another article of the new product that details the health and fitness aspects associated with the consumption of the new product. The Budget The expenditure of the Coca cola Enterprise in marketing and advertising in 2012, 2013 and 2014 was $3.342, $3.266 and $3.499 billion (The Coca cola Company: Form 10K). Since the company targets to realise more than half its sales from the sale of its diet products, it will spend approximately half of the marketing in the new product. Therefore, the expected budget for the marketing communication plan is $600 million. Table 1 in the appendix shows the advertising expenditure of the company. Conclusion The Coca cola Company intends to market its Coca Cola Life product in the 2015 marketing communication plan. The manufacture of the product arises from the increasing health concern of the conventional Coke product of the company. It is evident that the Coke product has impacted on the teeth of the children besides contributing to child obesity. The company intends to utilise advertising forms such as TV adverts, street and furniture advertising, online advertising and newspapers and magazines in advertising the new product. It is also appropriate for the company to use price deals, loyalty rewards programmes, online coupons, contests and interactive ads to market the new product. Finally, the company should use public relations, direct marketing and personal selling to communicate its healthier products to consumers. Reference List Bell, L 2004, ‘The Story of Coca cola’, Mankato: Smart Apple Media. Bruneau, E A 2011, ‘Advertising’, Marketing Series. Burnett, J 2012, ‘Sales Promotion and Public Relations’, Communicating to mass markets. CARIMAC 2011, ‘Developing Communication Strategy: Advantages and Disadvantages of different types of media’. Cuellar-Healey, S 2013, ‘Marketing Module 8: Promotion’, Marketing Modules Series. Curd, M 2015, ‘Marketing Plan: Coca-Cola in 2015’.I Dunn, S 2015, ‘The Coca-cola Company has launched its first new product since Coke Zero’, The Register Retail Intelligence. Available from: http://theregister.co.nz/news/2015/04/coca-cola-company-has-launched-its-first-new-product-coke-zero Gedenk, K, Neslin, S A & Ailawadi, K L 2006, Sales promotion, In Retailing in the 21st Century (pp. 345-359), Springer Berlin Heidelberg. Gulmez, M, Karaca, S & Kitapci, O 2010, ‘The effects of outdoor advertisements on consumers: a case study’. Healing Eating and Drinking (HED) 2007, ‘UK Consumer Goods Intelligence.’ Investor Business Daily 2014, ‘New Coca-Cola Life Targets Health-Conscious Crowd’. Available from: http://www.nasdaq.com/article/new-coca-cola-life-to-target-more-health-conscious-crowd-cm363756 Maandag, M 2015, ‘Coca-Cola Life: The Start of a New Life’. Available from: http://www.thebrandbite.com/2015/01/18/coca-cola-life-positioning/ Mai, L W 1997, ‘Direct marketing: an analysis of consumers' characteristics and their perceptions of and attitudes to mail-order specialty food in the UK’. Palazon, M & Delgado‐Ballester, E 2009, ‘Effectiveness of price discounts and premium promotions’, Psychology and Marketing, vol. 26, pp. 1108-1129. Popoya, D 2010, ‘Taking Advantage of Words’. The Coca cola Company Form 10K 2014, ‘The Annual Financial Report’. The Guardian 2004, ‘Things get worse with Coke’. Available from: http://www.theguardian.com/business/2004/mar/20/medicineandhealth.lifeandhealth Warner, C 2003, ‘Media selling’, Iowa State Press. Appendix The Coca Cola Life Marketing Design Figure 1: Coca Cola Life marketing design. The Agency Brief CONSUMER Most consumers aged 35 to 55 years are worried about their health. There is no confidence among the consumers when it comes to consuming high-calorie products. Consumers have a negative perception about consuming the other health drinks offered by other companies. Individuals suffering from obesity BRAND INSIGHT Coca Cola understands the obesity problem that people face when they consume high-calorie carbonated drinks. Coca cola intends to ensure that consumers feel satisfied with the new product thus build a strong confidence level. Coca Cola intends to ascertain that health-conscious consumers can still be healthy and live a healthy life when they consume the Coca Cola Life product. BIG IDEA: Life comes from the consumption of the naturally sweetened Coca Cola Life product TASK: To create the target population for the company i.e. individuals aged 35 to 55 years. To reach out to health-conscious men and women around the world. To create awareness among the individuals concerning the “coca Cola Life” campaign. To build the confidence of health-conscious consumers so that they can consume the product without any worries. WHERE AND WHEN? Coca Cola intends to use the social media as the main tool for the marketing campaign. Health magazines. Major sporting events. TV adverts YouTube Adverts. Places where obesity patients visit for medical care and advice such as hospitals. Figure: The Agency Creative Brief The Budget TV Magazines Outdoor Radio Internet Newspapers Unmeasured 235 40 30 15 20 10 250 Figure 3: The Budget in $million The Timing Plan Start Date Completion Date Action and Comments Launch of the Diet Coke Plus in 2015 (ASAP) 1-2 months following the release of the product TV adverts focused on group tests to guarantee the attainment of user requirements Launch of the Diet Coke Plus in 2015 1-2 months after the release of the product Sales promotion to reduce the initial price and increase market share Launch of the Diet Coke Plus in 2015 (ASAP) 1-2 months after the release of the product Sales promotion at the purchase of the product for instant competition Launch of reusable packaging material 2-3 months after release Press release to cover the details of the renewable packaging ASAP NA Press release to cover the company’s new strategy towards ‘green products’ and enhanced brand social responsibility Figure 4: The Timing Schedule Read More