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2、t a complete record of the discussion.Discussion documentDecember Coke Case Study Winning in Japan 日本市场可乐产品分析报告英文第1页FINGERPRINT COKEHighLow2NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第2页COKE IN JAPAN CapabilitiesLocalizes physical assets;bottling and distribution managed through alliances;bottling al
3、liances are typically inclusive 17 bottlers in JapanCreates direct distribution system to stores through bottlersOffers marketing,manufacturing,and investment support to partners,when neededHas supply alliances with McDonaldsSpends huge resources on influencer relationshipsPartners with local agenci
4、es for marketing capabilities(e.g.,Dentsu)Customer pull demand in product push Japan Uses segment marketing to understand customer behaviorOrganizationStrong community feel to CokeHolds conventions for bottlersDistributes bottlers magazineCompensation is competitive attracts graduates from top schoo
5、lsAlmost 10%of Japan office is foreigners some degree of tension with local staff;still has“ugly American”syndrome;senior Japanese experience glass ceilingJapan seen as strong progression path CEO used to head JapanProductAdapts products to local marketsAlmost 10%of revenue comes from Japan-specific
6、 productsBrands include Georgia Coffee,Sokenbicha,and AquariusBottlers guided Coke into developing localized products“Fast follower”strategy quickly followed lead of smaller local players to enter tea and coffee drinksCoke maintains full control over product content Launches new types of products in
7、 Japan(e.g.,canned soup drink)Middle Far EastEuropeNorth AmericaSales$Billions1993199519971999Performance/backgroundLevers for successOtherMarket informationMarket is very competitive more than 7,000 soft drinks are sold in Japan by 500 manufacturersVending machines account for 50%of soft drink sale
8、s Company informationCoke is the market leader in JapanJapan is a very profitable market for Coke(potentially the most profitable)Maintains 900,000 vending machines,2x the number of competitors ProductsCoffee drinks,green tea,black tea,milk/yogurt drinkCoke offers 5 brands with 60 flavors;75%of bran
9、ds are JapaneseCompetitors:Kirin,Ito En,SuntoryCST DCSEric Friberg*,Todd Guild*,Mark Loch,Hirokazu Yamanachi*14.018.018.919.833322114231533293429221525233814CAGR 9%*Has worked on Japan studies3NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第3页CONTENTS Company overviewJapan market entry strategyProductsCa
10、pabilitiesOrganization4NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第4页COKE COMPANY BACKGROUND Founded 1886 in Atlanta,USANumber of global employees:37,400CEO:Douglas N.Daft(Australian)Most senior manager for Japan:Mary Minic(President,Japan)Key products:carbonated and sports drinks,juices,tea,coffeeMa
11、rket cap:$151 billion(as of November 13,)Key industry focus:beveragesNo.1 soft drink company globally50%global market shareOwns two of top three global brands(No.1 Coca-Cola classic,No.3 Diet Coke)Market leader in soft drinks in Japan56%market share;competes with 500 manufactures selling over 7,000
12、drinksGlobal competitors:PepsiCo,Cadbury Schweppes,NestleCompetitors in Japan:Kirin,Ito En,SuntoryOwns 40%stake in Coca-Cola Enterprises(worlds largest bottler)5NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第5页COMPANY EVOLUTION Coke has been an international company since the start of the century,but WW
13、II made it a true multinational.Coke entered the bottling business in the mid-eighties.Recently,the company has seen strong profits from financial reengineering in its bottling segment.1800sInvented in 1886 in Atlanta,USA,as a headache,indigestion,and exhaustion remedyMajor advertising started in 18
14、92;by 1895 Coke was sold in every U.S.state 1900s-1920sCoke sells in Cuba,Jamaica,Bermuda,the Philippines,Puerto Rico,and Europe by 1916First bottling franchise established in 1901Repositions Coke as non-medicinal productCoke bottle invented in 1916Devotes personnel to maintaining good relations wit
15、h bottlers in 1922Establishes pioneering market research agency 1930s-1960sAdvertising targets minorities starting in 1950sWorld War II catapults Coke into world market,creating first U.S.multinationalFanta innovated by Coke in Germany,driven by ingredient constraints during WWIIOpens 15-20 plants w
16、orldwide during 1950sMerges with Minute Maid in 1960Merges with Duncan Foods in 1964Acquires Belmont Springs Water Co.in 1969Expands product line in response to PepsiCo competition in 1960sFanta in U.S.in 1960Sprite,Tab,Fresca introducedDiet versions introduced 1970s-1980sAcquires Aqua-Chem(desaltin
17、g machines)in 1970Acquires Taylor Wines and other wineries in 1977Introduces Coke in Russia and China in 1970sAcquires Columbia Pictures in 1982 for$750 millionReformulates Coke in 1985;unfavorable customer reaction Divests entertainment business in 1987Focuses on core,profitable business and double
18、s net income to$1 billion in 1988Enters bottling business in mid 1980s1990sLaunches“Always Coca-Cola”theme in 1993CEO articulates priorities in 1993 creation of stock holder value,brand building long-term focus Top 16 markets account for 80%of volume;the markets comprise 20%of world populationBottli
19、ng business plays important role in profitability Invention Repositioning and marketing Expansion,acquisitions,and diversification Diversification and rationalization MarketingSource:International Directory for Company Histories 6NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第6页Source:Annual report;Stan
20、dard&Poors RegistarNameRoleJapan experienceDouglas N.DaftCEO and ChairmanSENIOR MANAGEMENTPresident and COOJames E.ChestnutEVP,Operations SupportCharles E.FrenetteGary P.FayardSVP and CFOJoseph R.GladdenEVP and General CounselCarl WareEVP,Head of Global Public Affairs and AdministrationSVP,Chief Mar
21、keting OfficerStephen C.JonesCoke has a diversified team of senior managers.Used to head JapanJack L.StahlEVP,President of Greater EuropeUsed to run marketing in Japan7NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第7页COKE STOCK PRICE COMPARISON U.S.Coca-Cola Co.Beverages(non-alcoholic)S&P 500 Comp Ltd.C
22、oke dramatically outperformed the market as well as its competition,especially when it started divesting non-core businesses to focus on its profitable segment.Coca-Cola Co.Beverages index(non-alcoholic)S&P 500 index8NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第8页COKE SALES BY REGION$Billions Coke has
23、 an estimated 56 percent market share in Japan and has been growing its Japanese contribution to total sales.199319951997199914.018.018.919.8OtherMiddle and Far EastEuropeNorth America CAGR=9%142132332933231514222935382326139NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第9页Source:Company web-siteCOKES S
24、ALES BY BRAND In 1999,63 percent of Cokes total gallon sales came from products bearing“Coke”trademark.CokeOther10NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第10页Coke has historically made equity investments in selected bottlers with the intention of financial reengineering,but is now moving away from
25、 this strategy.The company has realized that“big is not always better”and is trying to get out of anchor bottlers in Brazil and the Philippines.Source:Annual reports;McKinsey analysisHIGHLIGHTS OF COKES BOTTLING BUSINESS Breakdown of worldwide unit case volume produced/distributedBottlers owned and
26、controlled by CokeIndependently owned bottlersBottlers in who Coke has non-controlling ownershipPercentHistorically,Coke invested in undervalued bottlers worldwide,provided financial and managerial support,and improved operating efficiencies which generated increased sales;Coke benefited from growth
27、,improved cash flows and increased owner value;at times,Coke sold these bottlers after turning them around,for sound profits11NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第11页SELECTED LOCATIONSCoke is headquartered in Atlanta,Georgia in the U.S.,but has subsidiaries located over a wide geography.NOT EX
28、HAUSTIVE12NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第12页CONTENTS Company overviewJapan market entry strategyProductsCapabilitiesOrganization13NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第13页STORYLINE In order to enter and succeed in Japan,Coke realized that it needed to adopt a partnering strategy.Cok
29、e allied with 17 locally owned and managed bottlers and leveraged these relationships to set up a direct distribution channel as well as gain manufacturing and marketing capabilitiesIt followed its bottlers advice and expanded its product offerings to include specialized beverages(e.g.,milk-based dr
30、inks,coffee drinks,teas).In addition,Coke introduced new product categories(e.g.,canned soups,Coo,a flavored juice product)and new flavors in existing brands(e.g.,Fanta Golden Pineapple)to increase its market share in trend-oriented JapanThe company was also innovative in its alliance strategy(e.g.,
31、supply alliance with McDonalds),its marketing techniques(e.g.,introduced reclosable PET bottles),and its acquisitions(e.g.,acquisition of Kanebos vending machine operations).Cokes sales channel(930,000 vending machines,over twice as many as its nearest competitor)is a distinct competitive advantage
32、in Japan where vending machines are the most popular sales channelCoke realized that it needed top talent to compete effectively in Japan and sent strong managers like Doug Daft(current CEO)and Stephen Jones(current Chief of Marketing),to Japan in leadership roles.Thus,Japan was seen as a progressio
33、n path to top positions in the companyCoke is currently the market leader in Japans soft drink segment with a 56%market share.Coke owns the number 1 local brand Georgia(coffee drink).However,the company has been a slow mover in exploiting new opportunities(e.g.water and sports drinks)In the future,C
34、oke faces the challenge of expanding its low market share penetration(20%)in the Japans most rapidly growing segment of specialized beverages 14NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第14页CONTENTS Company overviewJapan market entry strategyProductsCapabilitiesOrganization15NJ-262408.756/001117Nbge
35、oHR1日本市场可乐产品分析报告英文第15页PRODUCT STRATEGY Coke understands the importance of offering products that appeal to the local market,in addition to its existing,classic products.16NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第16页COKES JAPANESE PRODUCTS Coke has consistently rolled-out new products tailored for
36、the Japanese market.Source:Company website Georgia(coffee drink)Ambasa(non-carbonated lactic soft drink)Real Gold(carbonated herb mix flavored drink)Vegitabeta(fruity drink with multiple nutrients)Ko Cha Ka Den(blended tea Royal Milk,Fine Aroma Straight,Garden Lemon)Saryusaisai(non-sugar Oolong tea)
37、Saryusaisai Sokenbicha(special branded tea)Seiryusabo(Green and Barley teas)Shipla(“functional”,stress flavored drink with mulivitamins)Lactia(lactic,non-carbonated drink;promotes healthy digestion)Calo(“functional”soft drink;helps build healthy bones)Perfect Water(mineral water)17NJ-262408.756/0011
38、17NbgeoHR1日本市场可乐产品分析报告英文第17页CONTENTS Company overviewJapan market entry strategyProductsCapabilitiesOrganization18NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第18页COKE CAPABILITIES IN JAPAN Coke leverages local alliances to gain capabilities.The company also offers marketing,manufacturing,and investmen
39、t support to partners when needed.19NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第19页Japan is Cokes most profitable market after the U.S.Coke derives about 17-20%of its overall profit from Japan.Source:Wall Street Journal,January 14,1999JapanROWPercentJAPAN CONTRIBUTION TO COKES PROFITS IN 199920NJ-262
40、408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第20页CONTENTSCompany overviewJapan market entry strategyProductsCapabilitiesOrganization21NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第21页StructureDecision-rightsTalentCultureORGANIZATIONAL LEVERS Realignment of organization in January Increases focus on local busine
41、ss unitsRedefines roles and responsibilitiesIncreased autonomyTransfer of responsibility from corporate to local business unitsCorporate only responsible for overall company policy and strategyPerformance and results driven culture;aggressive approach to finance and marketing Compensation is competi
42、tiveJapan is seen as strong progression path and top talent is sent thereCEO used to head JapanChief of Marketing used to run marketing in JapanLack rotation of top Japanese peopleStill has“ugly American”syndromeSenior Japanese feel out of place,experience glass ceiling and do not get high positions
43、 in AtlantaStrong community feel to CokeHolds conventions for bottlersDistributed bottlers magazineSome degree of tension with local staffAlmost 10%of Japan office is foreignersCulture not“appropriate”but effectively translatedWinners allowed to be aggressive22NJ-262408.756/001117NbgeoHR1日本市场可乐产品分析报告英文第22页
