Place –a success element of Coca Cola

According to official statistics of Coca Cola, we found that about 1.9 billion products are sold all over the world every day. The main mode of distribution is that distributors offer products to convenience stores, restaurants and retailers.

The company offers its Cola to bottling operations, wholesalers and distributors. Then distributors provide products to restaurants, milk bar, stores and newsagents. Therefore, Coca Cola is available every corner of the world. The points of sales of Coca-Cola can be divided into are

(1) Distributors or Wholesalers

(2) Corner stores, retail, groceries or supermarkets

(3) Night clubs, cafés or restaurants

(4)Petrol stations1

(5)Automated teller machines

 

The types of marketing channels and its functions

The Coca-Cola Company is a global company that operates on a local scale, in every area where we do business (News,2016)

For Coca-Cola Company, the type of marketing channels is intensive distribution. Intensive distribution refers to its products widely distributed around the world (Gassenheimer, 2013). The intensive distribution is used by inexpensive, simple and transported products. Coca Cola build a huge distribution network around the world (News,)

Its distribution network is the most factors to develop in competitive food market.

It is affect customers behaviour successfully.

Coca Cola is well-recognized by customers, which makes wholesalers, retailers and store are very interested in its product. The company have achieved their target because of its high availability and visibility. Their product is available in every corner of the world, even in some remote places.

The issues involved in managing appropriate channels

The most important issue considered in managing appropriate channels is customers demand. Focusing customers enable develop business successfully. If a firm meets the demands of customers, it will attract customers’ attention and increase sales (News, 2008).

Customers always would like to buy some drinks in a convenient place. Another issue considered is its product is cheap, simple and transported products. The intensive distribution of Coca Cola will enable customers easy to buy.

Channel conflict and solution

One of channel conflict is a conflict among channel members. The Coca Cola Company want to provide a discount on its bottles and cans in order to increase its sales and enlarge its market (Hunt&Nevin,2005). However, some retailers believe that the profits of products will be reduced by offering discounts. Some retailers will discounts Coca Cola provided. Moreover, Coca Cola sell to Costco at cheaper price in order to increase sales, but its full service retailers will be dissatisfied with that. There are lots of solutions to solve this problem, but these solutions are not perfect. One of effective solution is to share information. It will enable to build trust between Coca Cola and retailers, however, it will take much money in sharing information and lead to the information being available to its competitors.

Another conflict is commotion in price. In order to increase their profits, some distributors try to attract customers by lowering their price. It will result in retailers buy the products at different price, thus leading to customers are dissatisfied with price of products. It will have a bad influence on sale of products. The coca Cola company should establish a same standard of price. In the contract signed by the distributor, the company needs to make clear the recommended retail price. In addition, the company needs to make contributor understand common interests.

The need for effectiveness and efficiency considerations of distribution channel

The Coca Cola Company mainly use pull strategy. It helps Coca Cola promote directly to end customers through this kind of channel. Customer will be encouraged to buy its products anywhere and anytime.

In the soft drink industry, distribution is a significance point of success. Coca Cola Company has a huge distribution. That is why Coca Cola is increasingly becoming popular beverage in the world (News,2016).

 

Written by: Yuchen Pang

Deakin email address:yuchenp@deakin.edu.au

ID: 216039596

 

References:

Gassenheimer, J. B., Sterling, J. U., & Robicheaux, R. A. (2013). Long‐term channel member relationships. International Journal of Physical Distribution & Logistics Management.

Hunt, S. D., & Nevin, J. R. (2005). Power in a channel of distribution: sources and consequences. Journal of marketing Research, 186-193.

News. (2008).Is Coca Cola it? from

http://www.bbc.co.uk/blogs/ipm/2008/05/is_cocacola_it.shtml

New. (2019), Monster’s 1Q16 Sales Benefit from Strategic Deal with Coca-Cola from

http://finance.yahoo.com/news/monster-1q16-sales-benefit-strategic-170451952.html;_ylt=AwrC1CjvvTlXJWYADjnQtDMD;_ylu=X3oDMTByOHZyb21tBGNvbG8DYmYxBHBvcwMxBHZ0aWQDBHNlYwNzcg–

 

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