Coca-Cola Company: Consumer Behavior

Introduction

This paper consists of a series of answers which are related to Coca cola Company in relation to its most popular product; the coca cola soft drink. Basically, the paper will analyze consumer behavior in the light of the soft drink. By examining a number of incidents that have already taken place in the context of the soft drink mentioned above, this paper seeks to shade more light on consumer behavior and how such a behavior determines the popularity of a product. In the process of making such an examination, timely insights and recommendations are made on what can be done to increase and popularize the company products.

Define motivation in relation to consumer behavior

Basically to motivate is to create an urge in somebody so that something is accomplished. It can be argued that motivation will push someone into accomplishing a given task within some given time frame. It has been argued that motivation is a force that stimulates human behavior (Tyagi and Kumar 1); it can be both negative and positive. Positive motivation is that which induces consumers to buy coca-cola; positive motivation are the needs, wants and the desires that have a net effect of making someone have the urge to use a given product in this context use drink coca cola.

Therefore, it can be argued that positive motivation, in the context of this paper, is the summation of all those urges that will have the net effect of directing a person into acquiring the coca cola for the purpose of consumption. It has been pointed out that positive motivation is enhanced by spirited sales promotion and advertisement though there are other factors which also play roles and will be covered later in this article.

On the other hand, there is a negative motivation which is associated with a collection of feelings that have a net amount effect of directing away the urge to consume a product in this context the product being coca cola. Some of the feelings that have the tendency to drive away the urge to use consume a product include fears and aversion.

Positive motivation forces like the need and desire drive consumers to buying coca-cola, consumers need the drink to satisfy their thirsty, consumers also desire coca-cola as a pleasure drink. Since one is motivated by a need, a need only becomes a motive when it is aroused to a particular level; a motive or drive is a need that is extremely pressing as to force individuals to find satisfaction for that need.

Theories that explain why consumers buy coca-cola

Individuals are motivated by the desire to have many needs as possible at a particular time. Needs can be biogenic and psychogenic; Biogenic needs are psychogenic in form and include forms of tension like hunger, thirst and discomfort. Psychogenic needs are those that emanate from psychological states of nature like the need for esteem, recognition or belonging. All these needs play a role in the creation of positive motivation. It should be noted that marketing strategies are often aimed at creating an arousal of such needs on a short term as well as long term basis.

There are several theories that have been formulated to explain why consumers opt for coca-cola drink to quench their thirsty instead of water. These theories are; Freud’s psycho analytic theory, Maslow’s hierarchy of needs and Fredrick Herzberg’s two option theory.

Freud’s psycho-analytic theory

This theory thrives on the assumption that the psychological forces that shape individual behaviors are unconscious. Freud argued that when an individual grows up, he/she suppresses several urges while accepting the social rules in the society and it only happens that these urges are not completely eliminated as they appear in dreams or through the slip of the tongue. This theory postulates that no individual understands the origin of his drive.

Consumers for example might purport to buy coca-cola drink and explain that the drive for purchasing it is to quench thirst and at the deep inside, the main purpose is actually to demonstrate an economic social class since coca-cola as opposed to water makes an individual appear modern and potent. This, therefore, is a clear indication that the drinking of coca-cola is conscious act and to trigger an emotion and to stimulate the consumers, the company must create an impact on its production, marketing and packaging of the coca-cola drink.

Consequently, Ernest Ditcher who is the principle advocate of Freudian motivation theory and who has widely interpreted buying situations and products preference, concluded in his work called motivational research that drive happens in line with the fundamental unconscious motives.

Maslow’s hierarchy of needs

This theory was formulated by Abraham Maslow. He postulated in his book Motivation and Personality the reasons why consumers are obsessed with different needs at particular times. Maslow organized the human needs in hierarchy from the most burning needs to the least burning ones as seen in the Maslow’s hierarchy of needs below.

According to Maslow, an individual will try to satisfy the vital needs first and when he achieves it, such needs, at that level, stop being a motivator and the individual is motivated by the desire to seek the most important need in the next level. As in the case of coca-cola, quenching the thirst is the fundamental thing and the most basic drive, satisfying it using water is primary as compared to using coca-cola which is expensive and it is only fit for those who have satisfied their psychological and social needs. The desire for coca-cola is primarily due to a need for self esteem and status. According to Abraham Maslow, an individual must first satisfy his biogenic needs before the psychogenic ones. Biogenic needs include love, belonging and self actualization.

Herzberg’s two factor theory

This theory was formulated by Fredrick Herzberg. Herzberg sought to differentiate between those factors that cause dissatisfaction and those that cause satisfaction, he referred to them as dissatisfies and satisfiers respectively. The case of coca-cola can be classified as satisfier. This is largely due to its taste and coloring which give coca-cola a distinct and sweet taste that makes it appealing as compared to water which is tasteless and colorless.

The Herzberg’s theory operates on two fundamental principles; first the seller should be in a position to produce good quality goods to prevent dissatisfaction that is prompted by factors like poor quality of products. This is evident when the coca-cola experienced low sales and customer dissatisfaction that was brought about by the change in formula to the New Coke. Secondly, the manufacturer, in this case Coca-Cola Company should identify satisfiers which may be factors like advertisement or packaging. This is because; a motivated person can also be influenced by perception. This brings out the idea that people prefer coca-cola to water because of perception.

What do consumers buy when they purchase a product?

Coke drinks are soft drinks that reduce thirst. The habit of using coca-cola to quench thirst has been associated with a social class because it has been argued that water can equally quench thirst. People in developed countries often take cola to satisfy their thirsty whereas in the developing world people satisfy their thirsty by taking water, this is a clear indication that coca-cola is a want and a need at the same time.

People need coca-cola to satisfy utilitarian need which is thirst. Taking of coca-coal is viewed to be refreshing. The following are some of the attributes that consumers want in a product.

Functional benefits

Functional benefits may be both direct and indirect; direct benefits are those that are resourceful and beneficial to the consumer. These direct benefits are as a result of the taste and nutritional value, they include quenching their thirst, and cola also boosts sugar and caffeine quantity in the body.

The indirect functional benefits

Consumers want convenience: consumers desire goods that are well organized and attractively displayed since this will facilitate convenient shopping. Coca-cola vendors should display the good in an attractive place as a persuasive measure.

Price and value: pricing is a factor that is necessary and often consumers consider it in buying coca-cola or/and other substitute or the competitive product.

Advertising: This is also an indirect benefit that consumers consider in determining their wants. Aggressive advertising may result in increase in volume of sales since consumers will be persuaded into buying the product.

Packaging: Good or attractive packaging is likely to lure consumers into buying the product.

Psychological benefits

Among the psychological factors are the lifestyle of the consumers, product differentiation and buyers’ experience. Consumers often buy a product due to the desire of creating an impression of modern and affluent lifestyle. On product differentiation, consumers often look for a unique product in the market and hence coca-cola should create an identity in their products.

On differentiation of the product, coca-cola has effected this through brand name, packaging and advertising. On the name, coca-cola have developed a short name which has been instrumental since a short name is catchy, easy to pronounce and memorable.

On packaging, coca-cola have packaged their products in different sizes and in feminine and appealing bottle, this is instrumental in winning the customer’s consciousness and also to foster product differentiation.

On advertising, coca-cola has embraced on brand awareness to introduce their brand into the market.

Critically evaluate the buying behavior of consumers to explain why Coca-Cola had a higher share of the cola drinks market than Pepsi even though the taste tests showed that more consumers preferred the taste of Pepsi

Consumer behavior implies the analysis of when, why, where and how trend in the ability of buyers to purchase a particular product. It is an analysis of the consumer decision in the buying process together with the characteristics of individual and group consumers. The following are the factors that influence consumer decision

Loyalty

This is described as the tendency of consumers to stick to one particular product. When there is a strong loyalty base, there is a minimal change in the number of consumers that are willing to buy that particular product. Customers who lack loyalty have the tendency of buying any good that they come across and they exhibit dynamism in their purchasing behavior; such customers are also vulnerable to forces of swaying by factors like sales promotion and advertising. One conspicuous model of loyalty is the memory effect which concerns consumers’ ability to return to a particular product after trying the competitive product and failing.

Rigorous advertising, several brands and having been in the market earlier than Pepsi are the factors that put coca-cola ahead of Pepsi in customer loyalty leading to the high volume of sales by coca-cola.

Sociology

Sociology explains how a consumer behavior of individuals can be influenced by other consumers. When some individuals get to purchase similar product of a similar brand, there is always a tendency of getting locked-in with a particular product however much that good can be identical to the substitute or the competitive product or regardless of whether the competitive product sells at similar price. Among the social factors those influence consumer behaviors are:

Group

People who interact and coexist together seem to have similar goals, an individual’s decision are always influenced by that of his group or close associates. These groups can be secondary or primary; secondary groups are formal institutions like school and occupation while primary groups include family, neighbors and co-workers. The geographical and the globalized market of coca-cola is what are largely associated with the ability of consumers to interact and influence each other about the product.

Psychology

Psychology concerns on how and what an item on the shelves of supermarkets and malls can influence the choice of consumers, this has the tendency of influencing consumers to purchase a good different from his previous brand. Advertisement can be a sociological as well as psychological. It is sociological when it takes the form of sales promotions and road show campaigns and also when the advertising takes the form of product advertisement and when sales agents are used. The psychological factors are motivation, perception, beliefs and attitude. It is psychological when it is media or digital advertisement crafted in a tendency that will capture the attention of the individual. Psychological influences can take the following models:

Minimize anticipated regret

This explains a situation where two products are identical on quality and price. This can present a challenge to the consumer who might confuse one product to be superior to the other. In this case the first product becomes the best choice for the consumer which is coca-cola in this case.

Attribute change

This explains a situation where the introduction of a new product may change the perception of consumers concerning an established product in the market. This might introduce the issue of quality which might have earlier been ignored. The introduction of Pepsi motivated coca-cola to up its quality which was evident in their shift from coca-cola to new coke and later to classic coke; this was mainly aimed at building their attribute.

Outlier avoidance

When a number of products in the market are very similar, consumers have the behavior of abandoning the brand they deem strange and the one that is quite different from the rest of the products. In this case, consumers can choose the one that sells at moderate price. The pricing of coca-cola makes it sell more when compared to Pepsi. This is further explained below:

1. Decision process change: consumer often experience easy time when it come to making a choice between two products since they can base their comparison on two main factors; size and price (Patel and Schlijper 4).
2. Internal influences: there are several internal factors that can influence the ability of the consumers to choose a particular product. These factors include demographic, personality and motivations.
3. Cultural factors: cultural factors include the sets of values, perceptions, norms and behaviors which influence wants and behavior of a consumer these factors are culture, sub-culture and social class. The social structure in the society also influence the values and interests of an individual (MBA Notes 1)
4. Personal factors: these factors include age, life cycle and occupation

What impact did age have on the behavior of consumers purchasing cola?

Age is a dynamic factor and often has direct relationship with the ability of an individual to think, as such people of similar age often undergo the same experiences in life and hence this makes them share similar needs, values, experiences, symbols and memories which directly translate to similar consumption patterns, consumers’ needs and their interests often vary with age. Age in relation to consumer behavior is categorized as follows; the young generations often admire leisurely and pleasurable goods and purchase different goods than the old generation.

The old consumers have tendency of brand loyalty and more often they exercise caution when making their purchase. There are some commodities that diminish with age like sugary and fatty foods. A detailed discussion in relation to age and consumption in the context of coca cola is carried out below:

The teens and the generation x

This is always the active age in the society and hence has a greater degree of influence on the purchase of household goods. The social factors that characterize modern societies like the increase in career parents and the surge in cases of single parentages is a clear indication that in the modern world the teens and the generation x age shop for themselves. The main sources of information about the products in the market are their friends and also discussions on blogs, short messages and the social networking facilities such as facebook and twitter. This category of generation also loves fun and trendy lifestyle, and fun comes at an expense.

This has a lot of implications on market products like coca-cola. The coca-cola company should devise new modes of advertisement and particular digital adverts which can capture the young generation in order to win in the area of brand loyalty and to be in good market position. The pleasure that is associated with cola and how it depicts a higher social standing in the society makes it appealing to the youth and the younger generations in general hence the high volume of sales (Hoyer and Macinnis 301).

Generation X

This is the generation in their late thirties and forties and are a loyal group and are cautious in making their purchases. Marketers experience changes with the old generation when they want to launch a new product since they want to stick to the product that existed during the time they were young. An increase in age leads to the decrease in appetite, old people also seem to be selective in the foods they take. The sugary taste of cola makes it less popular with the older generation. Since cola is served in restaurants and hotels is an indication that the old are not the main target market since old age is less prone to travelling and eating in hotels (Noel 78)

What impact might this have had on the marketing activities of Coca-Cola and Pepsi-Cola?

The coca-cola company used a type of marketing called undifferentiated marketing. This style of marketing is also referred as scattergun approach. This is because Coca-Cola Company had one line of product and they tried to pursue one approach in order to appeal to people of all ages and personalities (Blythe 383).

The coca-cola company often uses the demographic gathering of data as an instrument to find out the consumer group that use their products most. This data is gathered based on the following variables; age, sex, country and other personal and motivating factors.

Age is also fundamental in analyzing demand management which is a key marketing formula; demand management involve taking steps that might result in the company either raising or lowering the demand for its products or to create product adaptability which might result in the upward rise in the demand for its products to the target consumers and target market.

Age will also allow the coca-cola company to develop product positioning. Product positioning involves the way with which the consumers define the product based on various attributes or rather the place of the product on the mind of the consumer. Age therefore is a critical factor that that will determine the mode and system of marketing their products, age furthermore is important in determine which kind of advertisement to apply as a marketing strategy.

Critically evaluate the factors that contributed to the failure of New Coke

New packaging

This isolated the new brand from it consumers, when they branded it new coke, they had already missed the point since the world by then was associated with Pepsi which had just entered the market and was the favorite of the youth. The old coke was considered a legacy soft drink and an important part of the American culture hence the branding and the change of formula affected the loyalists of the earlier brand who found it difficult to associate with the new coke.

Sentimental value

The introduction of the new coke led to the erosion of sentimental value that was associated with the product. The launching of the new coke was more oriented towards the product and not the brand and this strategy backfired.

Limited research is also a key factor that contributed to the loss of appeal in the new coke.

What research into consumer behavior could Coca-Cola have conducted to reduce the risks of their new product failing?

Coca-Cola could have employed the Implicit Association Test (IAT). This is a mode of computer based measurement that seeks to relate concepts and memory. This system of research analyses cognitive process like attitude, advert response and the link between brand and consumer self-concept. IAT can predict consumer behavior (Perkins 1).

Coca-Cola ignored the Strength, Weakness, Opportunities and Threats (SWOT) analysis in its quest to analyze its position in the market. Undertaking a SWOT analysis exercise is very significant for effectiveness of any project in hand.

Strengths and weaknesses of the above research methods

Reliability

IAT has a certain degree of consistency in its calculation and has what is called test-retest reliability issue which confirms the exactness of measurement.

Fakability

The reports of IAT are fakable as compared to the normal and the commonly explicit self-reports. Fakability has the capacity to alter the rank order of the participant in the tests. Fakability also brings to fore such domain as human attitude, the self-concept and the stereotype factor than is instrumental; in analyzing the consumers desire.

Among the weaknesses of the IAT is that multiple behaviors very and hence may be difficult in the compilation of the results. This is because it can be affected by factors like social judgment.

Critically evaluate the buying behavior of cola consumers after the re-launch of Coke Classic and discuss possible reasons why sales of Coke Classic were higher after the re-launch than before the withdrawal of the product.

The buying behavior of the cola consumers after the re-launch from the new coke to the classic coke influenced by demographic, psychological and more so social cultural factors. As in the case of coca-cola, consumers’ behavior that characterized the market of the classic coke is: The availability of the product, the preference of the consumers, the brand awareness and the individual income of the consumers. The increase of the sales of the new coke was due the fact that there were still consumers who liked the flavor.

The bottling of the coke classic was one of the factors that appealed to the consumers since people associated with the emotional red color. The rigorous advertising campaign is also linked to the influencing of the c9nsumers toward the brand. The fact that cola classic regained a lot of ground in the marked and that it surpassed the Pepsi can be largely is attributed to the brand loyalty that was strong among the consumers. Economic and business commentators considered the re-launch of the product as a shrewd move that was aimed at letting the consumers understand how coca-cola is willing to meet the consumers demand, this however was not to be the case but they wanted to display how they could regain their lost ground and to prove that they are the best in the market as compared to the Pepsi brand.

Consumers of the coca-cola brand as analyzed from the case study are driven by loyalty. This is evident when the southerners who hosted the factory complained and largely opposed the re-branding merely due to the fact that they largely associated with the product. The media criticism of the branding influenced the consumers into believing that indeed the new coke was not good.

Works Cited

Blythe, Jim. Consumer Behavior. New York: Cengage Learning, 2008. Print.

Hoyer, Wayne and Macinnis, Debora. Consumer Behavior. New York: Cengage Learning, 2009. Print.

MBA Notes. Factors influencing consumer behavior. MBA Notes, n.d. Web.

Noel, Hayden. Consumer Behavior. New York: AVA Publishers, 2008. Print.

Patel, Shail and Schliper, Antoine. Models of Consumer Behavior Problem. Maths in Industry, 2011. Web.

Perkins, Andrew. Measuring the Non-conscious: Implicit Social Cognition on Consumer Behavior. Marketing, 2011. Web.

Tyagi, Clayton and Kumar, Arun. Consumer Behavior. New York: Atlantic Publishers, 2010. Print.