The Coca-Cola Company (TCCC) is one of the world\'s largest global brands. Soft
ID: 420437 • Letter: T
Question
The Coca-Cola Company (TCCC) is one of the world's largest global brands. Soft drink consumption has been on the decline for over 10 years. Responding to consumption and social trends, TCCC has purchased Honest Tea, 50% of Green Mountain Brewing - Keurig and Fairlife Milk. Fairlife Milk and Honest Tea have extended TCCC's product mix into two growing segments, Ready-to-Drink Tea and Premium Milk. What are the benefits sought by consumers in both of these categories that differ from soft drink consumption? Do you believe either of these brands can command a large share of their category like Coke has in the soft drink market? Why or why not?
Explanation / Answer
The benefits sought by consumers in both of the categories i.e. Green Tea and Milk based drinks are benefits related to health and overall well-being of body. As we know in this modern era which is dominated by internet and technology consumers have become health conscious and even the most common people have come to know that Cola drinks may or may not be harmful for them but they do not provide any health benefits as well.
We must ask a question why people buy cola drinks. The answer is to quench their thirst and to have a different taste. As we have seen in the history that the taste and preference of consumers change over time and that is what happening with TCCC, people now have other options to quench their thirst change their taste and the drink also provides them with some health benefits.
I doubt that either of these brands that is Honest Tea and Fairlife Milk can command a large share of their category as Coke has in the soft drink market because Coke because such a big brand because it had the first mover advantage in the market, TCCC made a product, introduced it into the market and ruled the market for decades. No one in the world was able to compete with TCCC and it did business on its own terms. The situation now has changed and there are multiple players who doing business in the category of tea and milk based drinks and they are equally able to compete with coke. Number of players in the global market has first mover advantage and the chances of TCCC's brand ruling the market share of that category is less.