Coca-Cola has strived to remain innovative during its 126 years of operation. The market for soda and other beverages is constantly changing, and Coca-Cola must keep up with these changes to remain profitable. Coca-Cola must invest in new products and technology to remain innovative. There are many motives to maintain a high level of innovation, including sustainable development, competitors, social awareness, new needs of its customers, and changing and shifting demographics. Addressing these motives will help Coca-Cola remain competitive and innovative in a changing marketplace.
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Sustainability is an important aspect of Coca-Cola’s operations. Coca-Cola has developed packaging for its products that are environmentally friendly and it continues to research and develop new technology for sustainable products. For example, Coca-Cola developed PlantBottle technology in 2009. PlantBottle is the first bottle made from partially from plants that are fully recyclable. Coca-Cola’s sustainability report highlights the benefits of implementing PlantBottle technology (Coca-Cola, 2014): “In addition to eliminating the equivalent of approximately 140,000 metric tons of CO2 emissions from the company’s PET plastic bottles, to date, the innovation has boosted sales of key brands like Dasani. PlantBottle also has strengthened Coke’s competitive advantage with key customers, racked up headlines and sustainable and innovation awards, and caught the collective eye of the supply chain and investor community.” By continuing to invest in environmental sustainability Coca-Cola will achieve a higher level of innovation.
Coca-Cola must strive to remain competitive in a changing market. The sales and consumption of soda has decreased over the past few years, so it is
important for Coca-Cola to develop new products to increase sales. Coca-Cola should research the sales and trends of its competitors to determine how they are performing and review its sales figures. Coca-Cola should determine how to improve its current products and provide new and improved products to generate new revenue. This will help Coca-Cola remain competitive and innovative.
Coca-Cola is focused on social awareness as their brand evolves to the changing needs of their business. Coca-Cola has invested in many organizations and charities to support causes that focus on community improvement. For example, Coca-Cola is currently running a campaign called Empowering Women: 5by20. This is Coca-Cola’s global commitment to enable the economic empowerment of 5 million women entrepreneurs across the company’s value chain by 2020 (Coca-Cola, 2014). Coca-Cola’s goal is to address common barriers women face when trying to succeed in business. This initiative offers women access to business skills training courses, financial services and connections with peers or mentors (Coca-Cola, 2014). This type of campaign can help Coca-Cola receive support from consumers and companies that may not already purchase Coca-Cola products. This also shows that Coca-Cola is interested in improving communities and supporting small businesses.
Customer Needs and Changing Demographics
Consumers are becoming more aware of health risks associated with sugary beverages and soda consumption has declined in recent years (Berr, 2013). As consumers are changing habits Coca-Cola must develop new products to match consumer wants. Coca-Cola has started focusing on the millennial generation and their consumer’s tastes for beverages. By focusing on this age bracket Coca-Cola can develop products and possibly increase future sales.
There are a few obstacles Coca-Cola must overcome to achieve its goal of becoming more innovative. This includes the project itself, risk, uncertainty, the company itself, and its internal and external environment. When companies choose to change or implement a new process it is normal to experience hesitation involved with development. Risk is high with developing new products because the outcomes of risk and development are uncertain (Jones, 2010). The risk and uncertainty of developing a new product that is not successful should not prevent Coca-Cola from researching options because consumer’s consumption of sugary beverages is declining. The company itself has evolved throughout its 126 years of existence, and it must continue to evolve if it intends to remain competitive. Coca-Cola’s external environment is a major reason for becoming more innovative as the market changes. Coca-Cola’s internal environment must support these changes so the company can remain successful and profitable.
Coca-Cola must push innovation to a higher level to remain competitive. Coca-Cola will stay successful by developing new products that cater to the market’s changing expectations. If Coca-Cola does not promote innovation its sales will suffer and current product consumption will continue to decrease. Coca-Cola should develop a process to evaluate various ideas and determine which to support. This will ensure Coca-Cola is focusing its efforts on one strong idea instead of spreading its resources across many ideas. Coca-Cola can implement an innovative culture by encouraging employees to submit ideas for new products and marketing. If an employee’s idea is chosen to market he or she could win some type of prize determined by the company. This will show that Coca-Cola is interested in feedback from employees at all levels of operation. In the first stage of development established project managers should develop as many new ideas as possible. This can include feedback from current employees as well. A team of managers will investigate each idea and decide which will move on to the second stage of development. During the second stage, the project manager will determine strategic and financial objectives, an analysis of market potential, a list of desired product features, a list of technological requirements, a list of financial and human resource requirements, a detailed development budget, and a timeline that contains specific milestones (Jones, 2010). This information will help the company’s managers decide which project fits its needs. The third stage is the development phase. This process can take six months to ten years.
Coca-Cola must continue to invest in new products and technology to remain innovative. Coca-Cola can create a business culture that remains innovative by encouraging innovation in its daily operations. There are various motives and risks associated with investing in higher innovation. By researching market trends and determining how Coca-Cola can adjust to these changes the company can develop new and improved products and technology.
Berr, J. (2013). Soda consumption fizzles to 26-year low. Retrieved from: http://money.msn.com/now/post.aspx?post=d2bfc3cd-35b5-4e44-8434-bc9d442811c1 Coca-Cola. (2014). Our Company. Retrieved from: http://www.coca-colacompany.com/ Jones, G. R. (2010). Organizational theory, design and change (6th ed.). Upper Saddle River, NJ: Prentice Hall