specific case study :• case debriefing :® set B u s i n e s s F i n a n c e

specific case study :• case debriefing :® set B u s i n e s s F i n a n c e

CASE STUDY: Please read through the following case and answer all questions.

Case 1: Coca Cola

The beverage industry is getting to competitive while it transforms due to the changing habits and behavior of the consumer market. The hot and cold beverages industry is a multi-category market with a $1.6 trillion base.

This diversity in addition to our relatively low share amount in the majority of markets and categories outside of sparkling allows for many compelling growth opportunities for our company.

As diverse as the beverages industry is, it has been outpacing the growth in other consumer product categories over the last three years and we anticipate this growth trajectory will continue into the future.

One component that makes the beverages industry especially attractive is that it is diversified across multiple channels with strong pricing power both in the developing and developed world.

The Coca-Cola Company the beverage giant managed to have seen an ongoing diversification of their portfolio over the last several years. Going

from a predominantly sparkling soft drink company to offering a diverse array of products across categories.

Today, sparkling soft drinks represents a little over half of their revenues. Although Coca-Cola is in pursuit of becoming an even more,

consumer-centric total beverage company, Coca-Cola are building on solid foundations. Today, Coca-Cola have a strong global position in all category

clusters in global nonalcoholic ready-to-drink (NARTD) beverages. However, outside of sparkling, our strong global position is

primarily due to a solid presence in only a handful of markets. Therefore, Coca-Cola have a long runway in the majority of markets to gain leadership

positions outside of sparkling.

The strategy is stated for the company as they continue through their journey as a total beverage company, disciplined portfolio growth plays

an integral role in that journey. Disciplined portfolio growth through a constant focus on innovation, revenue growth management and improved execution – all supported by integrated brand-building. Coca-Cola believe executing and improving upon these initiatives forms the foundation to deliver strong results today and, in the years, ahead. “A balanced focus on brands while responding to emerging consumer trends”, as stated by the company is the strategy for the coming period, their brand-building capabilities center around enduring principles such as human centricity, focusing on the basics, including being clear on the occasion, brand, price, pack and channel are executed against, and finally, capitalizing on new engagement models by creating experiences from points of interruption. The ultimate goal being to increase weekly drinkers of our

products.

At the Coca-Cola Company, they continuously leverage insights gained from innovation centers based in various regions of the world to offer

more personalized product solutions for consumers, such as tailored formulations and ingredients to match consumer tastes and lifestyles, broader

packaging options and more. Coca-Cola have refined their approach to innovation through a fixed number of ten innovation spaces in order to understand where the consumer is going not only today but years into the future. They have taken several steps in the ongoing evolution of their

revenue growth management (RGM) agenda. RGM is a key commercial capability that answers critical business questions of ‘Within the priority categories, where is the revenue? Which pack? Which price tier? Which channel? Which customer? Which competitor?’ It focuses on identifying revenue pools (where to play) and revenue growth strategies (how to win). RGM is a capability with different markets being at different points of the journey and adjusts based on the business objective and changing landscape. Digital is beginning to play an integral role in Coca-Cola RGM

strategy in order to drive their competitive advantage in making better, more informed decisions faster by translating data into insights into actions.

Digital is improving our insights both at the consumer experience level in addition to driving improved execution with our bottlers.

RGM is iterative and infinite. Thus, we believe we have a long runway ahead of us.

Questions:

1. In light of the above mentioned in the case, please explain Coca-Cola new Positioning strategy for their beverage business and how they may

apply this on the full marketing mix for their brands.

2. Please Explain in full details how Coca-Cola is applying the right approach to compete in a highly competitive marketplace and still maintain growth in revenues, which shall facilitate the achievement of their own goals as stated in the case.

Case 2: KFC Turnaround

New management today is incredibly deliberate about making the KFC brand relevant again. There’s two big ways for doing that, in the context of this industry: and that is through bold marketing activations and bold menu innovation. It’s all about making the brand and the product really relevant to emerging and quickly changing consumer taste. They will do this in a way that’s grounded in how the brand is currently positioned, yet it has to be dynamic enough to push out those boundaries. The new assigned CMO is finding ways to take what’s iconic about the brand to where their customers are to show up in unexpected way that ultimately make those experiences better for them. Looking out for trends and trying to be there in the moment when those trends are happening, willing to go outside of what is comfortable. You need to research trends and insert your brand into them. To

be relevant is much harder, and it starts with really knowing who you are, as a brand. KFC began working in 2014 and that was really the start of the turnaround. Spent months going through the archives and to realize that when KFC had been at their best as a brand, it was led by the heartbeat of our brand, Colonel Sanders. The new assigned CMO also chose to put all those evocative, iconic signifiers – the Red & White Bucket, the Colonel tie – back into the front and center of the brand. Once re-grounded on who the brand was, they looked for new ways to show up and express that. KFC wants to create experiences that people want to be a part of that elevate what people are already doing. Also like to find micro-cultures and experiment around how we can embed into them. Fundamentally, you want to be a brand that people want to be a part of. It’s that simple. You don’t want to be slapping your logo onto things; you want to create experiences that people want to get involved with.

For example, if KFC was concerned with staying conventional, they could hire a few Instagram influencers and get them eating and talking about KFC. And that would be just fine. Instead, they looked at the trend for Influencers and asked how to embed the brand in that trend in a way

that would invite people in. So, KFC used Colonel into a virtual influencer and he struck a chord with the public. People really began to follow him, engage with him, to such an extent that, ultimately, we were paid by brands like Dr Pepper, Casper, and Old Spice to promote their products. In the end, a quarter of KFC media spend on this campaign was paid for by other brands. And the virtual Colonel was out there influencing on behalf of other brands. You don’t get any more relevant than when other brands are paying you to make their brands relevant.

Fast food customers have a lot of choice and are not very loyal, so spending a lot of time building an innovation program that is highly

craveable to customers, so that they want to come to the brand. There was a time that the KFC brand risked becoming irrelevant, so committing to becoming a brand that is relevant across generations was the only option. Reconnected with heritage to understand what of core anchors emotionally to customers, and then looked at how we could innovate and push boundaries to drive our relevance and deliver this kind of growth.

Menu innovation needs to be exciting and really make people want to come to KFC to try it. The appearance of this menu innovation program was Chicken & Waffle that launched in the fall. Waffles are a huge food trend, that most people have heard of but haven’t tried, either because they couldn’t find it or they couldn’t afford it. By bringing in a delicious waffle that could serve hot at over 4,000 restaurants around the country, at a price point that people could afford, that allowed them to be a part of this huge food trend. It’s delivered through a product that is at the core of our business, our

world-famous fried chicken, so we can do it in a way that’s grounded in who we are – but pushes into a trend that’s happening out in the world.

Questions:

1. Many Companies sometimes choose to return to their roots to recapture lost brand positions. Please explain how KFC used this strategy to

recapture their roots and develop their competitive ability on all relevant elements of their marketing program.

2. Market leaders may sometimes use a flank defense strategy to help protect themselves from growing competition. Please discuss in regard to what was mentioned in the case how KFC is using this strategy as part of their approach forward. And how it may reflect on their marketing program.

Appendix:

How to Deal with a Case

A case study analysis requires you to investigate a business problem, examine the alternative

solutions, and propose the most effective solution or extract a key learning, using the

supporting evidence presented in the case.

Before you begin writing, follow these guidelines to help you prepare and understand the case

better:

• Read the case well and take notes, or highlights to relevant facts and try to underline key

issues

• Define the central issues in the case (Problem Statement)

® You may refer here to the respective question it may be of help

• Often it makes sense to Organize the problem statement in a hierarchical way:

® Identify the single most Over-Riding Issues

® Then spot any additional sub-issues, subsidiary to the main over-riding one

® When dealing with them deal with the most important first

• Identify Possible Root-Causes for the information provided

• You need to figure out and define the Firm’s strategic goals and objectives

• Now you may be able to identify key external & internal constraints

• Try to list all Possible Relevant Alternatives that apply within the constraints

• Select the Best relevant alternative and state why it is the Best

• Sketch an implementation plan (Action Steps) for this Best Alternative

Once you have drafted all necessary information, and requirements a structured report of your

analysis should include the following general sections, but these may differ depending on your

assignment directions or your specific case study:

• Case Debriefing:

® Set the scene: background information, relevant facts, and the most important issues.

® Demonstrate that you have researched the problems in the case study.

® Evaluate these pieces by discussing what is working and what is not working.

® State why these parts of the case study are or are not working well.

• Problem Statement:

® Outline the various pieces of the case study that you are focusing on.

• Identify Alternatives:

® Provide specific and realistic solution(s) or changes needed.

® Explain why this solution was chosen.

® Support this solution with solid evidence, such as: Key concepts from course (text readings,

discussions, lectures) or even outside research

• Recommend Best Alternative and Justify your recommendation

• Implementation Recommended Alternative – (How to do it?)

® Determine and discuss specific strategies for accomplishing the proposed solution.

® Recommend action steps needed to assure and consider key issues for implementation.

® What should be done and who should do it?