Marketing

Marketing

Read Case Study 14-1: Promoting Coke in South Africa and answer the following questions in an essay format.

1. Evaluate Coke’s market position in South Africa relative to other competitors and other businesses.

2. Evaluate the different types of consumer promotions used in South Africa to increase sales for Coca-Cola South Africa. Are there any types of sales promotions that should not have been used in a country characterized by a wealth gap, with a substantial proportion of the population below the poverty line? Explain.

Your answers must include content and cite reference materials where appropriate. To assist in this requirement, a good rule of thumb is that each answer should be approximately 200 to 250 words in length.

Chapter 14 International Publicity, Public Relations, and Sales Promotion Strategies 417

Case 14-1 Promoting Coke

in South Africa

Coca-Cola just moved its operating group headquarters

from the United Kingdom to Johannesburg,

South Africa, to be closer to target consumers.

Coca-Cola is the largest consumer goods provider

in Africa. To date, the company has grown through

close collaboration with its bottling and retail partners.

Company headquarters have an aggressive

growth plan for the African continent and for

South Africa in particular: With a large percentage

of the population young and dynamic, this market

should be carefully courted.

As part of its efforts to reach this population,

Coke set up the Coca-Cola Africa Foundation, in

which the company partners with other organizations

to build sustainable communities on the continent.

To reach young South Africans in particular,

the company hired South African artists that would

appeal to this segment of the population to participate

in a remix of the ‘‘I’d Like to Buy the World a

Coke’’ theme song as a musical montage of reggae,

Kwaito, rap, hip-hop, and hard rock. The ad was

part of the ‘‘Coke Side of Life’’ campaign, and

the theme song was so popular that radio stations

added it to their playlists.

South Africa was Coca-Cola’s first stop on the

African continent in 1928. The company set up

the first bottling and distribution plant in Johannesburg

and has expanded its business in the

country ever since, employing more than 10,000

people. The company’s presence in South Africa

created many more jobs in the country: For

every job created by the production and marketing

of Coke products, 10 additional jobs, on average,

were created in South Africa in related

industries.

The Coca-Cola Company sells numerous nonalcoholic

brands to South African consumers.

Among them are Coca-Cola (with its Light and

Vanilla Coke versions), Fanta (with its Orange,

Grape, and Pineapple versions), Sprite, Tab, Sparletta,

Lemon Twist, Schweppes, Mixers, Fresca,

Minute Maid, Powerade, Bibo, Milo, Krest,

Splash, Bonaqua, and Vitango. Its product mix

in South Africa is more extensive than in the

United States because, in South Africa, the company

also bought out a number of popular regional

competitors.

During its time in Africa, Coca-Cola ran a few

successful promotions. First, in 2002, it hired Riverside

Technologies in Wilton, Connecticut, to

provide ideas on technologic modifications that

would set the brand apart. Riverside came up

with modules that could be inserted into the packaging;

these modules would sing and announce

the winner of a Coke promotion. Consumers

who purchased the winning cans were instant winners

of Panasonic stereo equipment. The winning

cans were filled with carbon dioxide and water,

to replicate the weight and feel of a real can, and

were assembled into the Coke can by Schmalbach-

Lubeca Continental Can in Bonn, Germany.

Fifty talking cans were produced for the promotion

and were distributed nationally. In just the

first month of the promotion, sales of Coke cans

rose by 3.2 percent, Diet Coke cans by 18.6 percent,

and Fanta by 3.8 percent compared with

the previous year. This was in line with the

theme of the promotion, ‘‘This summer only

Coca-Cola talks,’’ literally—and figuratively, in

terms of sales.

Since 2002, Coca-Cola did not have many promotions

that had a similar impact. In the spring of

2004, for example, the company coordinated with

its advertising agencies another promotion that

was not as popular with South African consumers.

The promotion asked them to nominate the most

inspiring person they knew to carry the Olympic

Flame in Cape Town. Distributors were unhappy

that they were not involved in the promotion, and

generally, it was felt that a more aggressive and creative

approach was needed to resuscitate Coke

sales again.

In early 2006, Coke hired Conceptualise,

South Africa’s leading promotional marketing

specialist, whose area of expertise is the development

and implementation of promotional competitions

and games. The company developed

the Coca-Cola Mega Millions game for the

South African market, which has captivated

South African consumers. Mega Millions had a

game-show format, and it was broadcast live during

prime time on one of South Africa’s top network

channels, SABC 1. In the game, contestants

interacted live to win cars and large cash prizes.

To enter the game, individuals had to purchase

Coca-Cola carbonated drinks, check the label,

and find out if they won a prize. Their number

also qualified them to enter into a pool of candidates

to become a contestant on the live show—a

contestant was drawn during each show from the

pool of potential contestants. The Mega Millions

game was hugely successful, with 22 million

entries over a 4-month period.
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