ⓘ The Coca-Cola Company

                                     

ⓘ The Coca-Cola Company

The Coca-Cola Company is an American multinational corporation, and manufacturer, retailer, and marketer of nonalcoholic beverage concentrates and syrups. The company produces Coca-Cola, invented in 1886 by pharmacist John Stith Pemberton in Atlanta, Georgia. In 1889 the formula and brand were sold for.300 to Asa Griggs Candler, who incorporated The Coca-Cola Company in Atlanta in 1892. The Coca-Cola Company is the single largest plastic polluter in the world, producing over 3 million tons of plastic packaging each year including 110 billion plastic bottles.

The company - headquartered in Atlanta, Georgia, but incorporated in Delaware - has operated a franchised distribution system since 1889: the Company largely produces syrup concentrate, which is then sold to various bottlers throughout the world who hold exclusive territories. The company owns its anchor bottler in North America, Coca-Cola Refreshments. The companys stock is listed on the NYSE and is part of DJIA and the S&P 500 and S&P 100 indexes.

                                     

1. History

In 1886, pharmacist John Pemberton from Columbus, Georgia invented the original Coca-Cola drink and sold it as a medicinal beverage. Pembertons bookkeeper, Frank M. Robinson, is credited with naming the product and creating its logo. Robinson chose the name Coca-Cola because of its two main ingredients coca leaves and kola nuts and because it sounded like an alliteration. John Pemberton had taken a break and left Robinson to make and promote, as well as sell Coca-Cola on his own. He promoted the drink with the limited budget that he had and succeeded.

In 1889, American businessman Asa G. Candler completed his purchase of the Coca-Cola formula and brand from Pembertons heirs. In 1892, the Coca-Cola Company was formally founded in Atlanta by Candler. By 1895, Coca-Cola was being sold in every state in the union. In 1919, the company was sold to Ernest Woodruffs Trust Company of Georgia.

Coca-Colas first ad read "Coca Cola. Delicious! Refreshing! Exhilarating! Invigorating!" Candler was one of the first businessmen to use merchandising in his advertising strategy. As of 1948, Coca-Cola had claimed about 60% of its market share. By 1984, The Coca-Cola Companys market share decreased to 21.8% due to new competitors, namely Pepsi.

                                     

1.1. History Acquisitions

The company has a long history of acquisitions. Coca-Cola acquired Minute Maid in 1960 and in 1982, it acquired the movie studio Columbia Pictures for $692 million but Columbia was sold to Sony for $3 billion in 1989. It acquired the Indian cola brand Thums Up in 1993, and Barqs in 1995. In 2001, it acquired the Odwalla brand of fruit juices, smoothies, and bars for $181 million. In 2007, it acquired Fuze Beverage from founder Lance Collins and Castanea Partners for an estimated $250 million.

The companys 2009 bid to buy Chinese juice maker Huiyuan Juice Group ended when China rejected its $2.4 billion bid, on the grounds the resulting company would be a virtual monopoly. Nationalism was also thought to be a reason for aborting the deal.

In 2011, it acquired the remaining stake in Honest Tea, having bought a 40% stake in 2008 for $43m. In 2013, it finalized its purchase of ZICO, a coconut water company. In August 2014, it acquired a 16.7% currently 18.5% due to stock buy backs stake in Monster Beverage for $2.15 billion with an option to increase it to 25%, as part of a long-term strategic partnership that includes marketing and distribution alliance, and product line swap. In 2015, the company took a minority stake ownership in the cold pressed juice manufacturer, Suja Life LLC. In December 2016, it bought many of the former SABMillers Coca-Cola operations. The Coca-Cola Company owns a 68.3% stake in Coca-Cola Bottlers Africa. Coca-Cola Bottlers Africas headquarters located in Port Elizabeth South Africa.

In 2017, The Coca-Cola Company acquired Mexican sparkling water brand Topo Chico.

On August 31, 2018, it agreed to acquire Costa Coffee from Whitbread for £3.9bn. The acquisition closed on 3 January 2019.

The Coca-Cola Company acquired a 40% stake in Chi Ltd on January 30, 2016. The Coca-Cola Company acquired the remaining 60% stake in Chi Ltd on January 30, 2019.

During August 2018 The Coca-Cola Company acquired Moxie for an undisclosed amount.

On September 19, 2018 The Coca-Cola Company acquired Organic & Raw Trading Co. Pty Ltd the manufacturer of MOJO Kombucha in Willunga, Australia.

On August 14, 2018 The Coca-Cola Company announced a minority interest in Body Armor.

On October 5, 2018 The Coca-Cola Company acquired a 22.5% stake in MADE Group from Luke Marget, Matt Dennis and Brad Wilson the companys 3 founders. The Coca-Cola Company owns a 30.8% stake in Coca-Cola Amatil ltd, therefore The Coca-Cola Company owns a further 6.93% stake in MADE Group through its ownership stake in Coca-Cola Amatil ltd.

                                     

2. Revenue and sales

According to The Coca-Cola Companys 2005 Annual Report, the firm at that time sold beverage products in more than 200 countries. The 2005 report further states that of the more than 50 billion beverage servings of all types consumed worldwide, daily, beverages bearing the trademarks owned by or licensed to Coca-Cola account for approximately $1.5 billion. Of these, beverages bearing the trademark "Coca-Cola" or "Coke" accounted for approximately 78% of the companys total gallon sales.

In 2010, it was announced that Coca-Cola had become the first brand to top £1 billion in annual UK grocery sales. In 2017, Coke sales were down 11% from a year earlier due to consumer tastes shifting away from sugary drinks and health risks associated with artificial sweeteners in diet drinks.

                                     

3. Stock

Since 1919, Coca-Cola has been a publicly traded company. Its stock is listed on the New York Stock Exchange under the ticker symbol "KO". One share of stock purchased in 1919 for $40, with all dividends reinvested, would have been worth $9.8 million in 2012, a 10.7% annual increase adjusted for inflation. A predecessor bank of SunTrust received $100.000 for underwriting Coca-Colas 1919 public offering; the bank sold that stock for over $2 billion in 2012. In 1987, Coca-Cola once again became one of the 30 stocks which makes up the Dow Jones Industrial Average, which is commonly referenced as a proxy for stock market performance; it had previously been a Dow stock from 1932 to 1935. Coca-Cola has paid a dividend since 1920 and as of 2019 has increased it each year for 57 years. Stock is available from a direct purchase program, through Computershare Trust Company, but unlike many programs, has investment fees.

                                     

4. Bottlers

In general, The Coca-Cola Company and its subsidiaries only produce syrup concentrate, which is then sold to various bottlers throughout the world who hold a local Coca-Cola franchise. Coca-Cola bottlers, who hold territorially exclusive contracts with the company, produce the finished product in cans and bottles from the concentrate, in combination with filtered water and sweeteners. The bottlers then sell, distribute, and merchandise the resulting Coca-Cola product to retail stores, vending machines, restaurants, and food service distributors. Outside the United States, these bottlers also control the fountain business.

Since the early 1980s, the company has actively encouraged the consolidation of bottlers, with the company often owning a share of these "anchor bottlers".

Outside North America

The companys largest bottlers outside North America are:

  • Arca Continental, also based in Mexico parts of Mexico and Latin America and in US under Coca-Cola Southwest Beverages LLC in the state of Texas and parts of New Mexico, Oklahoma and Arkansas independent
  • Coca-Cola Bottlers Philippines, Inc., based in the Philippines Fully owned subsidiary of The Coca-Cola Company
  • Coca-Cola Japan Holdings Company owns 16.3%
  • Coca-Cola Beverages Africa, based in Port Elizabeth, South Africa southern and eastern Africa company owns 68.3%
  • Kirin Company, based in Japan independent
  • Embotelladora Andina S.A, based in Chile southern South America Company owns 14.7% of series A common stock outstanding & 14.7% of series B common stock outstanding
  • International Beverages Pvt. Ltd., based in Bangladesh Fully owned subsidiary of The Coca-Cola Company
  • Coca-Cola Icecek Based in Turkey Company owns 20.1%
  • Swire Group, based in Hong Kong independent
  • Coca-Cola FEMSA, based in Mexico parts of Mexico and Latin America Company owns 27.8%
  • Coca-Cola European Partners PLC, based in the United Kingdom western Europe Company owns 18.1%
  • Coca-Cola Korea, based in South Korea independent
  • Coca-Cola HBC AG, originally based in Greece but now located in Switzerland Company owns 23.2%
  • Coca-Cola Bottling Shqiperia, based in Albania
  • PT Coca-Cola Bottling Indonesia Company owns 29.4% Coca-Cola Amatil ltd owns 70.6%
  • Coca-Cola Amatil, based in Australia Company owns 30.8%
In the United States

In the United States, the company bypasses bottlers and is responsible for the manufacture and sale of fountain syrups directly to authorized fountain wholesalers and some fountain retailers.

After purchasing the North American assets of Coca-Cola Enterprises, as of 2014 the company directly owns 100% of Coca-Cola Refreshments, the anchor bottler of Coca-Cola products in North America, representing about 90% of Canada and 80% of the United States.

Other major bottlers in the United States are:

  • Coca-Cola Bottling Co. Consolidated, based in Charlotte, North Carolina company owns 34.8%
  • Swire Coca-Cola USA, based in Salt Lake City, Utah and owned by Swire Group
  • Coca-Cola Beverages Northeast based in Bedford, New Hampshire and owned by Kirin Company
  • Coca-Cola Bottling Company United, based in Birmingham, Alabama independent

In September 2015, the company announced the sale of several production plants and territories to Swire, Consolidated, and United, and creation of the Coca-Cola National Product Supply System which controls 95% of the territory in the United States.



                                     

5. Consumer relations and civic involvement

After Martin Luther King, Jr. won the 1964 Nobel Peace Prize, plans for an interracial celebratory dinner in still-segregated Atlanta were not initially well supported by the citys business elite until Coca-Cola intervened.

J. Paul Austin, the chairman and CEO of Coca-Cola, and Mayor Ivan Allen summoned key Atlanta business leaders to the Commerce Clubs eighteenth floor dining room, where Austin told them flatly, It is embarrassing for Coca-Cola to be located in a city that refuses to honor its Nobel Prize winner. We are an international business. The Coca-Cola Company does not need Atlanta. You all need to decide whether Atlanta needs the Coca-Cola Company. Within two hours of the end of that meeting, every ticket to the dinner was sold.

Throughout 2012, Coca-Cola contributed $1.700.500 to a $46 million political campaign known as "The Coalition Against The Costly Food Labeling Proposition, sponsored by Farmers and Food Producers". This organization was set up to oppose a citizens initiative, known as Proposition 37, demanding mandatory labeling of foods containing genetically modified ingredients.

In 2012, Coca-Cola was listed as a partner of the RED campaign, together with other brands such as Nike, Girl, American Express, and Converse. The campaigns mission is to prevent the transmission of the HIV virus from mother to child by 2015 the campaigns byline is "Fighting for an AIDS Free Generation".



                                     

6. Plastic production and waste

The Coca-Cola Company is the single largest plastic polluter in the world, for two years in a row producing over 3 million tonnes of plastic packaging each year including 110 billion plastic bottles. The companys global chief executive has admitted that Coca-Cola has no plans to reduce its use of plastic bottles; in fact, the company has "quietly fought efforts" to reduce the amount of plastic waste it creates, partly by opposing bottle bill legislation. The head of sustainability Bea Perez has said they will continue to use plastic, claiming "customers like them because they reseal and are lightweight". There are studies which show that 80% of customers are aiming to reduce their contribution to plastic waste, 69% are willing to pay more for eco-friendly packaging, and most support a ban on harmful plastic packaging.

                                     

7. Criticism

Since the early 2000s, the criticisms over the use of Coca-Cola products as well as the company itself, escalated with concerns over health effects, environmental issues, animal testing, economic business practices and employee issues. The Coca-Cola Company has been faced with multiple lawsuits concerning these various criticisms.

                                     

8. Advertising

Coca-Cola advertising has "been among the most prolific in marketing history", with a notable and major impact on popular culture and society as a whole.

The logo, bottle design, and brand image are internationally recognizable. Their product is ranked the number one soft drink, repeatedly, internationally, and has notoriety as the first soft drink consumed by astronauts in space. Coca-Cola employs a diverse range of integrated marketing communications to advertise through direct marketing, web based media, social media, and sales promotions Stringer, 2015.

The company carefully considers all touch points a consumer or prospective consumer has with the brand as potential delivery channels for the brands message, and makes use of all relevant communication systems. This well established, long-standing, consistent approach has created a longing for the product that by far "superseded the desire for that typically associated with a drink to quench ones thirst" Dudovskiy, 2015.

Direct marketing

They have exclusive vendor company partnerships, which eliminates competition, e.g. cinemas and restaurants only serving Coca-Cola over Pepsi. At sponsored sporting events, they again eliminate competition by attaining sole sale rights as well as VIP sales opportunities to important clients, for example, baseball fields.

Viral marketing

The company also markets via mobile marketing in text messages, e.g. viral marketing campaigns Stringer, 2015.

Web and social media

They set the industry benchmark as the brand so universally recognized that audience building is unnecessary. Their fan engagement spans 86 million globally across social media channels. They deliver a consistently unified message whether it be through new products, online interaction, and social, cultural, or sporting events Stringer, 2015.

Sales and promotions

In the retail setting, direct store beverage delivery trucks mobile advertising as well as point of sale coolers and vending machines have bright red logo blazoned branding. In terms of food service, Coca-Cola is a food pairing suggestion that is now ingrained as a food match, e.g., for popcorn, burgers, fries, and hot dog combos Stringer, 2015.



                                     

9. Products and brands

The Coca-Cola Company offers more than 350 brands in over 200 countries, aside from its namesake Coca-Cola beverage.

Green tea

The company announced a new "negative calorie" green tea drink, Enviga, in 2006, along with trying coffee retail concepts Far Coast and Chaqwa.

Glaceau

On May 25, 2007, Coca-Cola announced it would purchase Glaceau, a maker of flavored vitamin-enhanced drinks vitamin water, flavored waters, and Burn energy drinks, for $4.1 billion in cash.

                                     

9.1. Products and brands Columbia Pictures no longer owned

Coca-Cola bought Columbia Pictures in 1982, owing to the low monetary value of the studio. The film company was the first and only studio ever owned by Coca-Cola. During its ownership of the studio, Columbia released many popular films including Ghostbusters, Stripes, The Karate Kid, and some others. However, two years after the critical and commercial failure of the 1987 film Ishtar, Columbia was spun-off and then sold to Tokyo-based Sony in 1989.

                                     

9.2. Products and brands World of Coca-Cola

Coca-Cola operates a soft drink themed tourist attraction in Atlanta, Georgia; the World of Coca-Cola is a multi-storied exhibition. It features flavor sampling and a history museum, with locations in Las Vegas, Nevada and Lake Buena Vista, Florida.



                                     

9.3. Products and brands Other soft drinks

The Coca-Cola Company also produces a number of other soft drinks including Fanta introduced circa 1941 and Sprite. Fantas origins date back to World War II during a trade embargo against Germany on cola syrup, making it impossible to sell Coca-Cola in Germany. Max Keith, the head of Coca-Colas German office during the war, decided to create a new product for the German market, made only from products available in Germany at the time, which they named Fanta. The drink proved to be a hit, and when Coke took over again after the war, it adopted the Fanta brand as well. Fanta was originally an orange flavored soft drink which can come in plastic bottles or cans. It has become available in many different flavors now such as grape, peach, grapefruit, apple, pineapple, and strawberry.

In 1961, Coca-Cola introduced Sprite, a lemon-lime soft drink, and another of the companys bestsellers and its response to 7 Up.

Tab was Coca-Colas first attempt to develop a diet soft drink, using saccharin as a sugar substitute. Introduced in 1963, the product is still sold today, although its sales have dwindled since the introduction of Diet Coke.

Coca-Cola South Africa also released Valpre Bottled "still" and "sparkling" water.

In 1969, the company released Simba, which was a take on Mountain Dew, and had packaging that was African desert themed, replete with an African Lion as the symbol of the brand. The tagline was "Simba – It Cures the African Thirst."

Also in 1969, the company released a line of products under the name of Santiba, which was targeted for mixing cocktails and party usage, products including Quinine water and Ginger Ale. Like the above-mentioned Simba, the Santiba line of products was short lived in the marketplace.



                                     

9.4. Products and brands BreakMate

No longer manufactured, the Coca-Cola BreakMate was a three-flavor dispenser introduced by Coca-Cola and Siemens in 1988. Intended for use in offices with five to fifty people, its refrigerated compartment held three individual one-litre plastic containers of soda syrup and a CO 2 tank. Like a soda fountain, it mixed syrup in a 1:5 ratio with carbonated water. In North America, Coca-Cola discontinued spare BreakMate parts in 2007 and stopped distributing the syrup in 2010.

                                     

9.5. Products and brands Healthy beverages

During the 1990s, the company responded to the growing consumer interest in healthy beverages by introducing several new non-carbonated beverage brands. These included Minute Maid Juices to Go, Powerade sports beverage, flavored tea Nestea in a joint venture with Nestle, Fruitopia fruit drink, and Dasani water, among others. In 2001, the Minute Maid division launched the Simply Orange brand of juices including orange juice. In 2016, Coca-Cola India introduced Vio to enter into the value-added dairy category. The product lays the foundation for Coca-Colas new segment after carbonated beverages, water and juices.

In 2004, perhaps in response to the burgeoning popularity of low-carbohydrate diets such as the Atkins diet, Coca-Cola announced its intention to develop and sell a low-carbohydrate alternative to Coke Classic, dubbed C2 Cola. C2 contains a mix of high fructose corn syrup, aspartame, sucralose, and Acesulfame potassium. C2 is designed to more closely emulate the taste of Coca-Cola Classic. Even with less than half of the food energy and carbohydrates of standard soft drinks, C2 is not a replacement for zero-calorie soft drinks such as Diet Coke. C2 went on sale in the U.S. on June 11, 2004, and in Canada in August 2004. C2s future is uncertain due to disappointing sales.

Starting in 2009, The Coca-Cola Company invested in Innocent Drinks, first with a minor stake, increasing to 90% in the first quarter of 2013.

It was in May 2014 when Finley, a sparkling fruit-flavored drink, was launched in France. It was launched in other countries later, including Belgium and Luxembourg in September 2014. Coca-Cola first started developing the drink in Belgium in 2001. As of 2014, the drink is targeted for adults, and is low in sugar with four flavors.

                                     

9.6. Products and brands Best selling

Coca-Cola is the best-selling soft drink in most countries, and was recognized as the number one global brand in 2010. While the Middle East is one of the only regions in the world where Coca-Cola is not the number one soda drink, Coca-Cola nonetheless holds almost 25% market share to Pepsis 75% and had double-digit growth in 2003. Similarly, in Scotland, where the locally produced Irn-Bru was once more popular, 2005 figures show that both Coca-Cola and Diet Coke now outsell Irn-Bru. In Peru, the native Inca Kola has been more popular than Coca-Cola, which prompted Coca-Cola to enter in negotiations with the soft drinks company and buy 50% of its stakes. In Japan, the best selling soft drink is not cola, as canned tea and coffee are more popular. As such, The Coca-Cola Companys best selling brand there is not Coca-Cola, but Georgia. In May 2016, The Coca-Cola Company temporarily halted production of its signature drink in Venezuela due to sugar shortages. Since then, The Coca-Cola Company has been using "minimum inventories of raw material" to make their signature drinks at two production plants in Venezuela.

                                     

9.7. Products and brands Information

On July 6, 2006, a Coca-Cola employee and two other people were arrested and charged with trying to sell trade secret information to the soft drink makers competitor PepsiCo for $1.5 million. The recipe for Coca-Cola, perhaps the companys most closely guarded secret, was never in jeopardy; instead, the information was related to a new beverage in development. Coca-Cola executives verified that the trade secret documents in question were genuine and proprietary to the company. At least one glass vial containing a sample of a new drink was offered for sale, court documents said. The conspiracy was revealed by PepsiCo, which notified authorities when it was approached by the conspirators.

                                     

9.8. Products and brands Green tea

The company announced a new "negative calorie" green tea drink, Enviga, in 2006, along with trying coffee retail concepts Far Coast and Chaqwa.

                                     

9.9. Products and brands Huiyuan Juice

On September 3, 2008, Coca-Cola announced its intention to make cash offers to purchase China Huiyuan Juice Group Limited which had a 42% share of the Chinese pure fruit juice market for US$2.4bn HK$12.20 per share. Chinas ministry of commerce blocked the deal on March 18, 2009, arguing that the deal would hurt small local juice companies, could have pushed up juice market prices, and limited consumers choices.

                                     

9.10. Products and brands Coke Mini can

In October 2009, Coca-Cola revealed its new 90-calorie mini can that holds 7.5 fluid ounces. The mini can is often sold in 8 packs. Despite costing nearly 30 percent more per ounce, the mini cans have been met with positive sales figures.

                                     

9.11. Products and brands Holiday can

In November 2011, Coca-Cola revealed a seasonal design for their regular Coke cans as part of a partnership with the World Wildlife Fund. However it was withdrawn only a month after release due to consumer complaints about the similar look to the silver cans commonly used for Diet Coke. There were also complaints about deviating from traditional red as the color of Coca-Cola cans previously.

                                     

9.12. Products and brands Stake in Monster Beverage

It was announced on August 14, 2014, that Coca-Cola Co is making a cash payment of $2.15 billion for a 16.7 percent stake in Monster Beverage Corp to expand its market for energy drinks. Cokes ownership in Full Throttle and Burn will be transferred to Monster. In return, Monster will transfer its ownership in Hansens Natural Sodas and Peace Iced Tea and Blue Sky Soda to The Coca-Cola Company. Muhtar Kent, Cokes former chief executive officer, stated that the company has the option to increase its stake to 25 percent but cannot exceed that percentage in the next four years. Due to share buy backs by the board of directors of Monster Beverage Corporation, The Coca-Cola Companys stake has since increased to 18.5%.

                                     

10.1. Sponsorship Sports

Coca-Cola sponsored the English Football League from the beginning of the 2004–05 season beginning August 2004 to the start of 2010/11 season, when the Football League replaced it with NPower. Along with this, Coca-Cola sponsored the Coca-Cola Football Camp, that took place in Pretoria, South Africa during the 2010 FIFA World Cup, during which hundreds of teenagers from around the world were able to come together and share their love of the game, partly due to Best Buys efforts through their 15 program.

Other major sponsorships include the AFL, NHRA, NASCAR, the PGA Tour, NCAA Championships, the Olympic Games, the NRL, the FIFA World Cups and the UEFA European Championships. The company partnered with Panini to produce the first virtual sticker album for the 2006 FIFA World Cup, and they have collaborated for every World Cup since. Each fall, Coca-Cola is the sponsor of the TOUR Championship by Coca-Cola held at the East Lake Golf Club in Atlanta, Georgia. The Tour Championship is the season ending tournament of the PGA Tour. In the Philippines, it has a team in the Philippine Basketball Association, the Powerade Tigers.

Since the season of 2019 is the title sponsor of the Uzbekistan Super League in football, and this league is officially called Coca-Cola Uzbekistan Super League. Coca-Cola has also sponsored the Overwatch league since season two. They also sponsor all major Overwatch tournaments such as the world cup. In February 2020, Coca-Cola became the title sponsor for the eNASCAR iRacing series.

                                     

10.2. Sponsorship Television

The company sponsored the popular Fox singing-competition series American Idol from 2002 until 2014.

Coca-Cola was a sponsor of the nightly talk show on PBS, Charlie Rose in the US.

Coca-Cola is also executive producers of Coke Studio Pakistan. It was a franchising that started in Brazil, broadcast by MTV Brasil and there are various adaptations of Coke Studio such as Coke Studio India and Coke Studio Africa.

                                     

10.3. Sponsorship Theme parks

While not necessarily having naming rights to anything in all locations, the company does sponsor and provide beverages in many theme parks, usually in an exclusive capacity. This includes the Walt Disney Parks and Resorts, Merlin Entertainment, Universal Parks & Resorts, Six Flags, Cedar Fair, and SeaWorld Entertainment which are six of the nine largest theme park operators worldwide.

The company also directly sponsors, with naming rights, the Coca-Cola London Eye and the Coca-Cola Orlando Eye.

The company also operates "Coca-Cola" visitor centers in Israel, Belgium and Turkey.