Sample Essay on PESTEL Analysis on Coca Cola
PESTEL analysis on Coca Cola identifies market changes that are caused by political, economical, social as well as technological factors. Coca cola is a company that engages in the manufacture and distribution of over 300 brands of beverages. It offers its services in over 200 countries worldwide. This company has been ranked among the Fortune 500 companies for having the best strategies in marketing.
PESTEL analysis on Coca Cola Company is important because it helps in identifying and analyzing actions that are necessary and important to activate the company immediately. The current environment is changing continuously. Competition and advancement in technology are among the factors that force this company to think strategically so that it can make instant and quick decisions.
There are governments such as the Chinese government that have regulations that all companies operating in their countries must meet in terms of the products they supply. As such, starting to distribute or supply Coca Cola products in this country requires the company to meet these standards. This way, Coca Cola can avoid conflict with the government.
In addition, before entering a new market, Coca Cola must consider the beliefs that people in the region have. For instance, before Coca Cola started distributing its beverages in Malaysia, the Muslim symbol had to be incorporated as a Halal stamp in the products. Changes in regulations and laws, changes in international political regulations and civil wars are among the common political factors that affect the operations of Coca Cola Company.
Economic factors in different countries affect the price at which it sells its products. For instance, if inflation hit a country like China, the company has to reduce price at which it sells its products. Price of the products of the Coca Cola Company was also affected by recession that hit America in 2001.
Lifestyles of consumers change frequently in the contemporary world with most consumers becoming aware of health issues that are brought by the products that they consume. People in the contemporary world tend to drink less carbonated beverages because they fear that they cause diseases such as diabetes. This has reduced the demand for the carbonated beverages of the Coca Cola Company and subsequently reducing its income. Coca Cola has countered this by producing non-carbonated beverages such as sport drinks and juices.
To produce and market its products, Coca Cola embraces modern technologies. Over the years, the company has relied on social media and other online platforms to advertise and sell its products. The management of the company noted that in 2012, technology was one of the factors that enhanced its sales.
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