product launch by Coca Cola.
product launch by Coca Cola.
1) Explain clearly (and in your own words) the NEED (S) that Coca Cola is addressing with
its new product.
2) What is the intended TARGET MARKET? How (if at all) does if differ from Coca
Colas traditional target market?
3) Analyze some of the key (macro and/or micro) ENVIRONMENTAL FACTORS that
resulted in Coca Cola launching this new product. Note: for this, you will need to read
the chapter that deals with the marketing environment.
4) What kind of growth strategy does this new product launch represent? (Note: Relate to
discussion in class about growth strategies: Market Penetration, Market Development,
Product development, Diversification). Clearly explain your choice(s).
5) Analyze both ADVANTAGES and DISADVANTAGES (risks) of pursuing this strategy.
You may conduct additional research. If you do, please include in Works Cited page.
Coke gets into moo juice with premium-price
Bruce Horovitz, USA TODAY February 3, 2015
People already buy premium water, juice and coffee, but will consumers fork over more money for premium milk? Coke is
coming out with a milk that has more protein and less sugar than regular milk. (Feb. 3) AP
Coca-Cola, the kingpin of carbonation, is about to get a milk mustache.
The beverage giant announced on Tuesday that its Minute Made division is beginning to sell a
premium-priced, protein-boosted milk under the Fairlife label.
It will be available nationally next month when a national ad campaign breaks.
Coke says the milk — priced about $3.98 to $4.20 for a half gallon — is specially cold-filtered so
that it has 50% more protein, 50% less sugar and 30% more calcium than conventional milk.
It’s also lactose free and sold cold, in the dairy case. The line will offer whole milk, reduced fat,
fat-free and chocolate versions.
The move comes as carbonated drink sales continue to decline in the U.S. It also comes at a time
many consumers are infatuated with all things protein. Some 71% of consumers say they want
more of it in their diet says the research firm NPD Group.
In a phone interview, Steve Jones, CEO of Fairlife, strongly insisted that while Coca-Cola is
distributing the milk, it is playing no role in the milk’s actual production and has nothing to do
with what takes place on the dairy farms. “People keep referring to this as ‘Coke Milk’ and it’s
not,” he says.
Coke’s sole job, he says, “is to distribute the milk and make sure it gets on the shelf.”
“Coke is not making any milk here,” concurs Mike McCloskey, co-founder of Fairlife and CEO
of the dairy farm co-op Select Milk Producers. Coke and Fairlife will jointly bring the product to
market, though Fairlife will oversee the advertising.
Just as consumers are willing to pay big for premium coffees, they will pay big for premium
milk, says Jones.
Over time, Coke and Fairlife executives hope the brand will grow as big — Jones told USA
TODAY, “I hope it’s Coke’s next billion dollar brand.”
That may take a while. Due to competition from other beverages, retail volume sales of
fresh/pasteurized milk fell 3% in 2014 after dropping by 2% in 2013, reports Euromonitor
But Jones says Fairlife’s real competition is from premium, value-added, growth areas of milk,
such as organic, soy and lactose-free offerings.
The milk is chilled to 34 degrees after it comes from the cow, then put though a cold filtration
system that removes lactose and much of the sugar and protein is added. Because of the way it’s
pasteurized, the Fairlife milk lasts 90 days in the cooler vs. 15 days of conventional milk.
Jones says Fairlife focused on the chilled product, but would consider a shelf-stable milk “in the
One beverage industry expert says it’s a smart move. “I think getting into beverages which
supply protein makes sense for the big beverage companies,” says John Sicher, editor and
publisher of the trade magazine Beverage Digest.
But one nutritionist is unimpressed. “Milk is already an excellent nutritious beverage that does
not require any engineering,” says Rebecca Solomon, director of clinical nutrition at Mount Sinai
Beth Israel in New York City. “I fail to see why milk needs to be improved upon by the soda