IMPROVING THE SALES OF COCA COLA DIET PRODUCTS IN NIGERIA USING PAID MEDIA SPACE
CHAPTER 1
1.1 THE COCA COLA COMPANY
The Coca-Cola Company is a beverage, manufacturer, distributor, and marketer of non-alcoholic beverage concentrates and syrups. The company is best known for its flagship product Coca-Cola, invented by pharmacist John Smith Pemberton in 1886. The Coca-Cola Company (TCCC) owns four of the top five soft-drink brands (Coca-Cola, Diet Coke, Fanta, and Sprite). Its other brands include Minute Maid, Powerade, and Dasani water. In North America it sells Groupe Danone’s Evian; it also sells brands from Dr Pepper Snapple Group (Crush, Dr Pepper, and Schweppes) outside Australia, Europe, and North America. The firm makes or licenses more than 3,000 drinks under 500 brand names in some 200 nations. Although it does no bottling itself, Coke owns 34% of the world’s number one Coke bottler, Coca-Cola Enterprises (CCE); 32% of Mexico’s bottler Coca-Cola FEMSA; and 23% of European bottler Coca-Cola Hellenic Bottling.
1.2 KEY PRODUCTS
The sales of Trademark Coca-Cola, which includes Coca-Cola, Coca-Cola Zero and Diet Coke®/ Coca-Cola light®, are what fuel the business of Coca cola Company. The growth and success of Trademark Coca-Cola enables the Coca-Cola system to further invest in programs, marketing and innovation. Over the past 20 years, Trademark Coca-Cola has sold an incremental 5.8 billion unit cases. This incremental unit case growth spans every operating group, with the largest growth in Latin America, Europe, and Eurasia and Africa. While a significant amount of this growth is attributed to emerging and developing markets, Trademark Coca-Cola continues to also grow in developed markets.
1.3 COCA COLA IN NIGERIA—NIGERIA BOTTLING COMPANY (NBC)
Nigerian Bottling Company Plc is the authorized bottler of Coca – Cola products and the leading producer and largest bottler of Alcohol-Free beverages in Nigeria with a workforce of over 5,000 people. Nigerian Bottling Company has its operations dated back to 22nd November 1951 when it was incorporated as a subsidiary of A.G. Leventis Group and was given the franchise to bottle and sell Coca cola products in Nigeria. In 1972, it became a public company with its shares listed on the Stock Exchange. NBC kicked off as a family business and has metamorphosed into a large soft drinks company. It is a subsidiary of Coca cola Hellenic Bottling Company (CCHBC), the emerging company in the merger of Hellenic Bottling Company and Coca cola Beverage Company Plc in 2000. The range of Coca-Cola beverages available in Nigeria includes:
- Coca-Cola: (Classic, Light and Vanilla)
- Fanta: Orange, Lemon, Pineapple, Blackcurrant and Apple
- Schweppes: Bitter Lemon, Club Soda, Tonic Water (these “Mixers” were previously bottled under the Krest brand. NBC re-acquired the Schweppes franchise in August 2001) and Pineapple.
NBC products are also bottled in glass that can be recycled and are manufactured locally, as well as PET bottles (Coca-Cola, Fanta, and Sprite)
- Eva Table water in PET bottles
- Five Alive fruit juice (Citrus Burst, Tropical Hit, Berry Blast, Pineapple Punch, and Apple Splash)
1.4 PERFORMANCE OF NBC IN 2009
The unaudited First Securities Discount House Limited (FSDH) Securities Q3 2009 result of Nigerian Bottling Company Plc (NBC) for the period that ended on 30 September, 2009 showed that its Turnover (TO) grew by 14.60% an equivalent of N64.74bn, compared with N56.47bn in the corresponding period of 2008. Profit before Tax (PBT) increased significantly by 106.8% between 2008 and 2009 an equivalent of N2.75bn from N1.33bn in the corresponding period of 2008. The tax provision moved up significantly, increasing by 309.5% between 2008 and 2009 an equivalent of N1.46bn from N357mn bringing the Profit after Tax (PAT) to N2.29bn as against N974mn in 2008. This represents a significant growth of 135.2%.
Figure 1.0 NBC Progress in Nigerian Stock Exchange [Source: FSDH Securities Equity Research Report for NBC].
However, when compared to the rest of Africa and Eurasia, NBC still has room for improvement given the progress of India and South Africa.
Table 1.0 2009 Unit Case Volume for Eurasia and Africa [Source: 2009 OPERATING GROUP HIGHLIGHTS FOR THE COCA COLA COMPANY].
S/A
LOCATION
UNIT CASE VOLUME
A
SOUTH AFRICA
14%
B
EAST AND CENTRAL AFRICA
12%
C
INDIA
12%
D
TURKEY
12%
E
RUSSIA
9%
F
MIDDLE EAST
7%
G
SOUTHERN EURASIA
7%
H
NIGERIA
5%
I
OTHER
22%
Figure 2.0 2009 Unit Case Volume by Geography [Source: 2009 OPERATING GROUP HIGHLIGHTS FOR THE COCA COLA COMPANY].
CHAPTER 2
2.1 EARNED, OWNED AND PAID MEDIA
The terms “earned, owned and paid (aka bought) media” have become very popular in the interactive marketing space today. In fact, taken together they can be applied as a simple way for interactive marketers to categorize and ultimately prioritize all of the media options they have today. Nokia was an early pioneer in this space. They now categorize all of their global interactive media as earned, owned or bought. Many agencies, including R/GA, Critical Mass, Sapient and Isobar also use the model to help develop digital strategies.
Yet as popular as these themes have become, they’re often loosely applied across the industry and essentially no one is speaking the same language. Here’s a summary of how to define each type of media and their roles:
Table 2.0 Comparing the three forms of media. (Source: Forrester Research, Inc.)
Ultimately these types of media work best together but making the hard choices of what to include and what not to include is crucial – especially when budgets are tight. Many people are predicting the end of paid media (aka advertising). However, that prediction may be premature as no other type of media can guarantee the immediacy and scale that paid media can. However, paid media is shifting away from the foundation and evolving into a catalyst that is needed at key periods to drive more engagement.
2.2 COCA COLA USAGE OF PAID MEDIA
According to the Coca cola Company 2009 Annual Review, in developing markets, Coca cola is focused on growing annual consumption of their beverage products. Their growth strategy in developed markets is to maximize value and profit. They work to grow their brands and product offerings while delivering more value to consumers who in turn purchase these products at a premium price. Coca cola usually starts with products that have been successful in developed markets and then innovates products specifically targeted for a market while growing their consumer base. They also strengthen their marketing in the region through media advertisements, billboards in high-traffic areas and connecting with consumers through mobile phone marketing and newly established loyalty programs. In the paid media space, Coca cola have spent more than 120 years purchasing media and using it to build their global brands. Today, Coca cola is focused on driving innovation and productivity across paid advertising investments. This approach increases consumer engagement, while also driving effectiveness and efficiency for Coca Cola marketing programs.
2.3 APPLYING PAID MEDIA — LIVE POSITIVELY™
LIVE POSITIVELY™ is Coca Cola’s commitment to making a positive difference in the world by redesigning the way people work and live so that sustainability is part of everything they do. It is important to note that consumers make purchasing decisions about beverage brands based on the great taste and quality of the products as well as considerations about nutrition and health and how the product will impact their world. People want to interact with brands and companies that share their values and are doing their part to protect and enhance people’s lives, communities and the world. By engaging in sustainable business practices and helping to improve the lives of people in the communities Coca Cola calls home, they earn the social license to operate and the opportunity to thrive.
LIVE POSITIVELY is a way for Coca Cola to think holistically and globally about sustainability efforts throughout the Coca-Cola system. It includes goals, metrics and principles for their work across seven core areas key to our business sustainability: Beverage Benefits; Active Healthy Living; Community; Sustainable Packaging; Water Stewardship; Energy Management and Climate Protection; and Workplace. NBC can apply the principle of “Paid media space” by sponsoring a program that falls under the Coca Cola “Live positively” scheme. By affecting the lives of Nigerians positively, NBC can also gain more patronage for their products which will significantly improve profitability.
CHAPTER 3
3.1 ULTIMATE BODY “LOSE TO WIN” WEIGHT LOSS CHALLENGE
NBC can apply the Coca-Cola “Live positively” scheme by being a part of the Ultimate Body “Lose to win” challenge, a program conceptualized by Ultimate Body Limited. This initiative will help Nigerians regain their health, confidence and self-esteem. The program reaches out to the obese, overweight, unhealthy and the general public, who are enthusiastic about their wellbeing. The competition was created with the intention of building a better Nigeria. Some people have poor health and others just gobble down anything in sight. There is a need to educate and inform the public on the consequences of obesity, improper eating habits, and disregard for health conditions and health hazards.
The competition itself will be conducted within the duration of 12 weeks. It would require people that are visibly overweight to compete. The competition requires them to upload their “before” pictures on the competition website, go through the 12-week exercise training and dietary plan provided still on the website and then upload their “after” pictures at the end of the competition. The most transformed contestants would be up for gifts and cash prizes. In accordance with the Ultimate Body Weight Loss Timeline (Figure 3.0), the “Lose to win” challenge is the fastest way to attain an ultimate body shape. NBC will make a positive difference in the lives of Nigerians; create an interactive medium with old and new consumers while improving sales of related products.
3.2 REASONS FOR SPONSORING WEIGHT LOSS PROGRAMS
Today it is estimated that as many as 1.7 billion adults and children around the world are overweight or obese, a condition that increases the risk for chronic, non-communicable diseases such as cardiovascular disease and Type 2 diabetes. Obesity is a complex global problem influenced by many factors, including genetics, eating behaviors, physical activity patterns, psychological issues, cultural aspects and social frameworks. However, the fundamental underlying factor is an imbalance between calories consumed and calories expended through basic metabolic processes and physical activity.
3.2.1 ADOPTING COCA COLA PHYSICAL ACTIVITY PROGRAMS
Coca cola has shown commitment to developing and creating programs that support active, healthy living, in particular through physical activity and nutrition education programs in collaboration with governmental agencies and health experts. Millions of young people and adults have participated in Coca cola-sponsored activities in their communities.
In June 2007, Coca cola committed $2.5 million over five years to several national parks in the United States. This support is in partnership with the National Park Foundation and is assisting
with trail creation, enhancement and restoration. Additionally, it is now community and youth engagement in the stewardship and health benefits of national parks in the United States.
Many Coca-Cola programs in Latin America focus on inspiring young people to learn and incorporate healthy choices, including exercise, into their lives. Coca-Cola Mexico, in partnership with the Public Education Secretary and CONADE (Sports and Physical Culture National Commission of Mexico), fosters the well-being of 1.5 million Mexican students through “Zafo no jugar” (translated to “Unite to play”), a program that encourages physical activity in elementary schools throughout Mexico. Currently, the program operates in more than 700 schools in 14 Mexican states.
3.2.2 EMULATING THE PEPSI HEALTH AND WELLNESS APPROACH
In 2009, Pepsi announced 11 ambitious global goals and commitments to guide their work to help improve the well-being of people in both developed and developing countries. They are focusing their work on the products they make and on key policies and partnerships to help them address global nutrition challenges. With respect to “Community”, Pepsi works with the three goals stated below.
- Invest in Pepsi business and research and development to expand their offerings of more affordable, nutritionally relevant products for underserved and lower-income communities.
- Expand PepsiCo Foundation and PepsiCo Contributions initiatives to promote healthier communities, including enhancing diet and physical activity programs.
- Integrate Pepsi policies and actions on human health, agriculture and the environment to ensure they support each other.
3.2.3 GAINING INTERNATIONAL RECOGNITION
Advertising is one of the many marketing tools that are used to attract attention of prospective customers to a business or its products or services. The more effective an advertising campaign, more the customers it draws, and with greater frequency. Advertising is part of the overall marketing strategy of a business, which includes public relations, promotional programs, signage, incentives, newsletters, and word of mouth, among other strategies. The aim of a marketing strategy is to use advertising, along with these other tools, for maximum impact. These benefits are encapsulated in the Ultimate Body “Lose to win” package. Ultimate Body also intends to prepare a five minute daily program for twelve weeks both on local and international media informing the public on exercise and dieting tips.
CHAPTER 4
4.1 PRODUCTS OF INTEREST
Over the past few years, people all over the world have become conscious of the fact that excessive weight contributes to ill-health and social prejudice. Painstaking efforts are being made to control weight gain through dieting and exercise. Dietary products are being manufactured at an increasing rate, to complement dietary plans. Even companies that produce high-calorie and high sugar content products have started manufacturing low-sugar/ low-calorie substitutes. Due to the fact that these products are low in sugar and calorie, they pose no threat to dietary plans, matter of fact, they help maintain weight.
4.1.1 COCA COLA LIGHT AND EVA TABLE WATER
Ultimate Body Limited proposes to use NBC Coca Cola Light and Eva table water as key products which are useful for sustainable weight control and maintenance. These products will be incorporated into the dietary plans of the competitors and publicized as a major factor for attaining the ultimate body shape. Coca cola light which is low in calories can help dieters maintain their weight and still remain refreshed. The question really is “What does Eva table water have to do with weight loss?”
4.1.1.1 WATER AND WEIGHT LOSS
Initial weight loss is largely due to loss of water, and an obese person needs to drink an adequate amount of water in order to avoid dehydration. The process of burning calories requires an adequate supply of water in order to function efficiently; dehydration slows down the fat-burning process. Burning calories creates toxins and water plays a vital role in flushing them out of the body. Dehydration causes a reduction in blood volume; a reduction in blood volume causes a reduction in the supply of oxygen to muscles; and a reduction in the supply of oxygen to muscles can make a person feel tired.
Water helps maintain muscle tone by assisting muscles in their ability to contract, and it lubricates body joints. Proper hydration can help reduce muscle and joint soreness when exercising. A healthy (weight loss) diet includes a good amount of fiber. But while fiber is normally helpful to the digestive system, without adequate fluids it can cause constipation instead of helping to eliminate it. Drinking water with a meal may make obese people feel full sooner and therefore satisfied eating less.
Water is essential for nutrient absorption and many chemical reactions in the body, including proper brain function and improvements in memory. Although water does not provide energy in the same way carbohydrates and fat do, it plays a very important role in energy transformation. Proper hydration is especially important during exercise. Adequate fluid intake for athletes is essential to comfort, performance and safety.
4.1.2 COCA COLA LIGHT PLUS AND COCA COLA ZERO
Coca cola Light Plus is a product NBC should consider for production because though it has the same formulation as Coca cola Light; it is fortified with vitamins and minerals. We believe that this product will, not only help in the maintenance of weight but also provide the essential vitamins and minerals that the body requires for optimal functioning. Coca cola Zero or Coke Zero should also be considered for production. It is a diet variation of Coca-Cola. It is marketed as having zero sugar, except in the United States, Canada, and Taiwan, where it is marketed as having zero calories. Coke Zero’s formulation is intended to be a calorie-free alternative to Coca-Cola Classic.
CHAPTER 5
5.1 CONCLUSION
Many a small thing has been made large by the right kind of advertising. NBC can improve the sales of its diet products by embarking on health and wellness campaigns. One medium to achieve this is the use of paid media. The content on display is the Ultimate Body “Lose to win” challenge while the products for sale are NBC diet drinks. A business is successful to the extent that it provides a product or service that contributes to happiness in all of its forms. By being a part of the Ultimate Body “Lose to win” challenge, NBC will make a positive difference in the lives of Nigerians while creating an interactive medium with old and new consumers. This off course will lead to improved sales of its diet products.
REFERENCES
1.) 2009 COCA COLA COMPANY ANNUAL REVIEW
2.) FSDH SECURITIES EQUITY RESEARCH REPORT FOR NBC, Q-3 DECEMBER 2009
Note
N-Forecast signifies the new turnover forecast when the sales of coke zero and coca cola light plus has been included.
About the Author
Mr. Etaje Darlington obtained B. Sc in Petroleum and Gas Engineering, University of Lagos in 2010. A two time silver position inventor in the “TREM new discovery scheme—Project Forte”, he is the Head of Concepts of Sui Generis Entertainment Company: A dance, music and modeling embassy that bring art into tangible forms of impression, expression and passion. He has published several papers that are currently helping the oil and gas industry solve unique gas production problems. Currently, he is the Director of Concepts and Special Projects at the Ultimate Body Limited Nigeria.
email: silver4darlington@yahoo.com
Phone number: 234018284425, 2347062430937
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