Coca Cola IM

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International

MarketingIndividual Assignment

12/19/2009

Submitted toMs. Rekha

Submitted byAnupam Singh

BLR 0903031002



International Marketing

Bangalore Management Academy

Table of contents:

1. Introduction………………………………………………………………3

2. Problem Formulation……………………………………………………..4

3. Political barriers………………………………………………………..…6

4. Languages barriers ..............................................................................…...7

5. Argument in Support…………………………………………………..….7

6. Conclusion …………………………………………………………..……9

7. Bibliography…………………………………………………………..….10





Introduction:

This report is based on the international businesses which is established for become entrepreneur.

In international business, it require to know how carry out its business across the world. It is the

planning of any business to set up the pricing, promotion, place and distribution services in terms

of to make sure that they satisfying the need of the consumers. Therefore, the report is about

analysis of the coca cola company as an international brand along with its experience in the

Indian beverage industry. This report will also tell about the several barriers such as legal,

political, culture, languages and social factors which influences the business. Coca cola which

has enough experiences in terms of make sure that what the need is for to do business in Indian

market. The company had been faced many problems when it entered in the Indian market but

later on it adopted the Indian culture to do good business here. Today it has most successful

brand in Indian market and easily understands the customers demand based on couples of decade

experience of Indian beverage market. Now is has become one of the leading brands in beverage

market along with several other flavor brands such as Limka, Sprit and Thoum up. In started

when coca cola entered into Indian beverage market then it had faced political barriers and had to

move out for couple of decades.





Problem Formulation:

Coca cola is one of the leading brands in all over the world which was created in 1886 by Johan

Pemberton in Atlanta. Firstly it has started only as beverage products but later on in many other

countries it has also started non beverages products also through which become brand valued

Company in the world. Coca cola first opened its first international bottling plant in 1906 in

Canada. Later on around 1920 it was started in twenty seven countries throughout the world and

valuable in fifty one more countries. It entered in Indian market around in 1970 but due to the

some political factors it had to move out from Indian market but earlier in 1993 again entered

and become success in the Indian beverage market. In 2003 Sanjeev Gupta took over the charge

as a CEO of coca cola in India and saw the sales dropped where no one was ready to sale coca

cola brand in Indian market but later on Gupta considered the problems and came with right

conclusion through company has increased the sales. (External Influences 4: Coca-Cola -

Activity)

Firstly when it entered in the International market it faced several problems in terms of to reach

the brand value was low, quality contradictory, ineffective advertising in different languages

which was vital task for the company and other factors were different cultures and governments

regulation were huge barriers. Therefore, when first time coca cola entered into Indian beverage

industry around in 1973 it had faced various problems such as due to the change in center

government coca cola had to move out from Indian marketing. Because new government came

and applied business regulation vice versa then congress did before came to other government

and first the made rules to out the foreign companies. However, in 1991 after globalization again

coca cola came to India but they faced several problems in terms of culture, language and legal

barriers. Therefore, India is a land of different cultures where there are several languages are





spoken in which around thirty percent people can speak English in this situation they have been

facing various problems to communicate the target audiences.

Furthermore, it is required for any entrepreneur can expend successfully and grow their business

by taking responsibility of legal in any country. It is necessary to follow such types of law and

regulation in terms of keep people healthy and proficient. Therefore, in India there is one most

important law which legalizes all the foreign exchange transactions along with investment

abroad through foreign exchange management act (FEMA). In India it has been authorized under

the act of reserve bank of India (RBI) through applied various rules, norms and regulations

consulting with the central government of India.

Therefore, they have to have faced various problems such as legal and social factors. For

example, several years before in Varanasi people marched against the coca cola to demanding

shut down its bottling plant from the village because it creates severe water shortages and

polluting the ground water and land. They blamed that coca cola bottling plant for water crises

through heavily extraction of the water from the ground water sources through polluting ground

water. Later on the utter Pradesh state pollution board sent a legal notice to coca cola in that

regards (India: Major Protest Demands Coca-Cola Shut Down Plant, 2008). Even though coca

cola had been operating illegally for at least eight months and government immediate took step

to shut down the bottling plant. Same as they have to face other problems in terms of pollution

air, water and natural sources. So being in business in India they have to make sure that they

must follow all the legal and cultural regulations. In India culture and specially languages have a

vital impact on the coca cola in terms of advertising campaign. Because of the difference in

languages coca cola is not able to reach more and more customers. Therefore, to operate these

types of strategy in Indian market they have to look at in different prospective based on the





languages such as in south India they need to implement different strategy vice versa then north

India. However, coca cola has gained lots of experiences through many controversies against

itself in couples of years. Later on when first entered that time it had not enough experiences to

understand Indian market in terms of cultures, languages, legal and political barriers but after

globalization and heaving couples of decade experience helped them to better understanding

Indian in every conditions. However, coca cola in some plants is not able to produce documents

to the panchayath that company has license issued under the factories of the state pollution

control. The panchayath has objection that company has wasted around five lakhs litter ground

water in thirty four acre land of areas in 2005 (Stolegeneration:PANCHAYATH REFUSES TO

RENEW LICENCE OF COKE PLANT, 2005). Same as it has also been facing lots of problems

in Colombia in terms of spoiled ground water and also is not able to understand the human’s

right through that company is not able to make better reputation in the public of Colombia.

Political barriers:

In 1977, when the Janata Party came in power, Indian government forced coca cola to move out

from the country but in 1993 again it returns in India and now it has around fifty two factories in

India. Coca cola set up its plant for produce Fanta, Limka, Sprit and Thums up in Kerala in 2000

where people found that it has affected the water and also affected people health. So the village’s

panchyath had put the conditions of heaving licenses for open plant

(Stolegeneration:PANCHAYATH REFUSES TO RENEW LICENCE OF COKE PLANT,

2005).





Languages barriers:

Languages are the major part of every communication and some time it has also become as a

barrier for an organization to setup their business (Cateora, 2008). In India there are many

different language occur which known as a land of several different languages. Therefore, coca

cola has an experience to remove these barriers such as for Tamil Nadu coca cola has different

brand ambusher and other is Rani Mukherjee. They also use different strategy in terms of

languages such as in Hindi they use different punch line than in south India. After been spending

long time in Indian market they came to know in better way how much they need to spend for

various languages and religions because they analysis the market demand and based on that they

advertise the brand.

Argument in Support:

Coca cola has become instant success in south as well as in north India through made its entry in

north Indian states such as Haryana, Punjab and Himachal Pradesh. Firstly when it entered in the

Indian market its targeted was only for young adults which were unmatched taste experience and

the right product such as the 1.25 liter bottle which cost was twenty five rupees. But later on it

fulfill the needs of consumers on a regular basis through producing various different other

beverage such as orange beverage along real plump which designed to extend the company’s

market share in terms of leader of beverage industry in India. Earlier they came up with the

different test flavor in terms of south and north zone based on the culture and perception of the

people (Minute Maid Pulpy Orange enters the markets of North India).





To establish the branding into the international market it is necessity to understanding the

political, legal, languages and culture factors. In fact being an international company that has to

preserve its joined standards where there they can make good relation in every condition.

However, it is normal thing that most of the businesses have to consider towards the activities

which they were doing. They have the problem by the local residence towards spread the

pollutions in terms of under water sources along with health problem. Coca cola had faced the

challenges in Kerala where the government banned on the production and selling the product of

coca cola because couples of controversies. The laboratory had claimed on product of coca cola

that was harmful for the people but the state government went beyond the high court took favor

of company. However in Kerala people claimed that they have been affecting since the company

set up its plant there. On the other side coca cola said that the water problems are happening due

to the lack of raining they even helping the local community to selling the water tanker in the

particular area. However, a large numbers of people have against the company for shut down the

plant because they claimed that the plant is harmful in many condi tions for the villager’s health

(India: Major Protest Demands Coca-Cola Shut Down Plant, 2008). However, people have

negative bias towards the company that it is not able to adopt Indian culture but on the other side

company also become very ethic in terms of doing social works in many places. Through that

they have also gained value ethic in its brand image. One of the major things through company

become leader in its beverage segments that it has become flexible and has ability to handle the

command respect through enough knowledge about the country. However, if the company could

have relationship with other local players then it did not have to face such types of problems

which it had faced later on.





Conclusion:

Hence, we have seen that the company entered in India around in 1970 but after few years due to

the changes in political conditions they had to move out from India. But later on after

globalization in India again came even though it had been facing many problems because of

languages, culture and legal barriers. After heaving experience of Indian market it has become

huge success which is one of the leading beverages brand. However, we also seen that in the

term of international business coca cola have been facing several difficulties for people health

and spoil the environment. Coca cola also has several causes against of it somewhere for water

crises and for other issues also. Finally, coca cola has gained lots of experiences of Indian market

and came to know the importance of legal, languages, cultures and other related barriers. But

now company has good reputation in terms of every aspect and running as a successful brand in

the major potential beverage markets in India.




Bangalore Management Academy Page

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Bibliography

Cateora, P. G. (2008). International Marketing (13th ed.). New Delhi: Tata McGraw-Hill

Publishing Company Limited.

External Influences 4: Coca-Cola - Activity. (n.d.). Retrieved december 16, 2009, from bized:

http://www.bized.co.uk/educators/16-19/business/external/activity/ethics.htm

India: Major Protest Demands Coca-Cola Shut Down Plant . (2008, April 08). Retrieved

December 15, 2009, from globalreseargh:

http://www.globalresearch.ca/index.php?context=va&aid=8591

Kotler, P. &. (2009). Marketing Management (13th ed.). New Delhi: PHI Learning Private

Limited.

Minute Maid Pulpy Orange enters the markets of North India. (n.d.). Retrieved december 16,

2009, from coca-colaindia: http://www.coca-

colaindia.com/corporate_citizenship/corporate_citizenship_action_detail.aspx?cid=125

Stolegeneration:PANCHAYATH REFUSES TO RENEW LICENCE OF COKE PLANT . (2005,

April 27). Retrieved December 16, 2009, from

http://community.livejournal.com/stolngeneration/15476.html#cutid1

The South is an important market but there aren’t many big marketers there. (2009, August 13).

Retrieved December 16, 2009, from thehindubusinessline:

http://www.thehindubusinessline.com/catalyst/2009/08/13/stories/2009081350080300.htm

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