Coca-Cola Brazil - Tubainas War

1329 words 6 pages
1. Briefly summarize the major characteristics of the Brazilian soft drink market.
• There were more than 3500 brands of soft drink in Brazil, manufactured in more than 700 plants in 2004. From 1986 to 2003 nonalcoholic drink consumption lead to 11.6 billion liters with average year to year growth of 13.92%.
• Post economic stabilization in Brazil, per capita consumption of soft drinks shot up 60% from 1994 to 1999.
• According to Brazilian Market Research Association classification of five social classes, class C accounts for 28% of the total national consumption of soft drinks and these class C people favor price affordability at comparable quality.
• Per Capita Consumption of Soft Drink in Brazil is increasing by average rate of
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|costing. |
|Coca Cola’s financial leverage allowing buyback of franchise operations. |Frequently changing leadership in Brazil. |
|Increasing promotional activities to improve image and goodwill. |Ambiguous strategic vision in the top management towards market share and |
| |profitability. |
|Opportunities |Threats |
|Per capita consumption of soft drink in Brazil increasing drastically |Pepsi Ambev alliance for producing & distribute Pepsi product in Brazil. Its |
|Class C consumed 28% of total national consumption & whose buying |result in Pepsi sales grew by 28%- ‘03 |
|decisions are influence by quality of product. This can help Coca Cola to |Low price small local brand Tubainas with 32% Market share in 2003 |
|overcome on local brands. |Local Non Tax payers’ soft drink manufactures who don’t have legal existence |
|Socio economic conditions in Brazil were similar to that in Mexico, which |Very low Brand loyalty & price