Introduction
This report is based on the Coca-Cola company to analyze the E-business strategy. The company was founded in 1886 by Dr. John Pemberton. Coca-Cola is one of the largest companies in the beverages industry and operates in more than 200 countries & territories. The organization owns over 500 brands, including Fanta, Sprite, and Diet Coke with a vast distribution network. Coca-Cola’s products & services such as the production and distribution of energy drinks, bottled water, soft drinks, and teas. Some products include Diet Coke, Fanta, Sprite, Dasani, Sports drinks, and Costa Coffee.
The company’s business model is business-to-consumer (B2C) but they also sell to businesses (B2B). Coca-Cola sells its products to wholesalers & retailers, who then sell to customers. The organization also sells directly to restaurants, call centers, and small stores. In terms of digitalization, it impacts the beverage industry and as a market leader, the company has adapted to these changes. With the help of PESTLE analysis, the organization’s digital strategy can be identified. In terms of political factors, the digital tools enable Coca-Cola with rules & regulations, specifically around traceability & transparency of products in the supply chain. The rise of mobile shopping has transformed the customer purchasing power which creates new opportunities for the company economically. Socially, they can connect directly with the customers through social media and personalized marketing campaigns. Coca-Cola has been using AI and machine learning to improve consumer insights and enhance its supply chain as a part of technology. In terms of legal factors, the company is using digitalization to meet data privacy and customer protection laws across diverse regions.
Element 1 -: A critical analysis of how the e-business has adapted to the challenge of Artificial Intelligence (AI)
E-Business strategy
Coca-Cola’s e-business strategy is linked to a combination of defensive and offensive strategies.
- Using a defensive strategy, Coca-Cola is concentrating on continuing market share and defending its brand from digital disruption. This includes improving the security of consumer data and ensuring online presence (Wood 2024). This strategy is enabling Coca-Cola to invest in loyalty programs and digital marketing as well as to safeguard its customer base and retain customer loyalty in a rapidly changing environment.
- With the help of offensive strategy, the company is embracing digital transformation to develop good relations with customers and to create new revenue streams. To enhance customer experience, Coca-Cola is also using AI to engage customers & to have their insights. The use of e-commerce is enabling companies to use social media to increase brand visibility and improve product offerings, customer engagement, and marketing campaigns.
Figure 1L E-business Strategies
(Source: Lecture notes)
Alignment of Digital Strategy with its Business Goals
It has been identified that the digital business strategy of Coca-Cola is highly aligned with its business goals which comprise:
- Customer Support Chatbots: To enhance customer engagement, Coca-cola has focused on improving consumer interaction with the help of social media platforms, personalized marketing, & loyalty programs (Allal-Chérif et al, 2021). They provide 24*7customer support ad resolving issues quickly.
- E-commerce Platform: The digital strategies and e-commerce platform have allowed Coca-Cola to enter into new markets, especially in emerging digital markets, and research new products & services. They also invest in user friendly e-commerce platforms that participates online and in-stores stocks.
- Boosting operational Efficiency: The organization reduces costs and boosts operational productivity by streamlining its making, supply, & sales operations with digital solutions.
- Sustainability Goals: Coca-Cola optimizes its energy & water use with digital solutions, cutting waste, and improving its processes eco-friendlier (Evseeva et al, 2019).
Impact of AI on Beverage Industry
Artificial intelligence has a significant impact on the beverage industry to manage its operations, inventory, supply chain management, and so on. It includes:
- Optimize Supply chain management: Coca-Cola is one of the largest manufacturers of soft drinks. However, it requires digital tools and techniques to maintain its operations and supply chain management. By using AI, the organization is enhancing its supply chain by forecasting demand, reducing waste, and enlightening inventory management (Demirand Dincer, 2020). It has been identified that AI predicts the demand more appropriately, confirms the products are delivered at the right time, and regulates manufacture schedules. As a concern for supply chain management, it also improves transparency, and operations, and prevents fraud.
- Marketing and Consumer understandings: Using AI, enables organizations like Coca-Cola to examine customer data and advertising strategies. AI also helps the company in social media analytics, ad optimization, and content creation for hyper-embattled movements.
- Operational Efficiency: Artificial intelligence enables Coca-Cola to improve speed, reduce human error, and upsurge steadiness in manufacturing processes (Otles and Sakalli, 2019). In the production process, the use of AI ensures better food production and quality control by monitoring the production process.
Coca-Cola’s adoption of Artificial intelligence
The organization has adopted artificial intelligence to examine customer data, forecast trends, and deliver hyper-personalized advertisements. It has been identified that data-driven technologies help the organizations like Coca-Cola process vast datasets, comprising social media interactions, culture trends, and buying habits, and generate relevant & appealing campaigns (Pandey 2023). It includes:
- Customer Engagement: Coca-Cola is using AI to analyze the social media content of their clientele, and create an understanding of where, when, and how its products are consumed. Based on the real insights, Coca-Cola can identify which category of products are popular in which area.
- Personalization and customer experience: While using AI, Coca-Cola provides personalized services to its customers by directing particular customer segments with tailor-made offers and recommendations (Chowdhury et al, 2022). For instance, the organization uses chatbots on its mobile apps and official websites to offer consumers modified suggestions or support them with orders.
Comparison with competitors in terms of AI usage
In the beverage industry, Coca-Cola's key competitors include Nestle and PepsiCo which has been making a substantial pace in AI adoption.
- PepsiCo: It has been identified that PepsiCo has been using AI-driven customer engagement tools such as virtual assistance and personalized shopping experiences for customers on e-commerce platforms (Elittan et al, 2024). They also use data-driven solutions to create new flavors and improve its product portfolio.
- Nestle: The organization uses AI for product development, particularly understanding customer preferences and current trends. They also exploring the sustainability process with AI to track and enhance water usage production and cutting carbon emissions.
Comparison
Similarities: Like Coca-Cola, it has been identified that both Nestle and PepsiCo use AI for marketing optimization, supply chain management, and operational efficiency (Arian Nezhad, Bastam and Hosseinzadeh, 2023). They all use data analytics to gain real insights into customers related to predicting demand and customer preferences.
Differences: PepsiCo seems to have a slight advantage in terms of AI implementation in customer engagement with chatbots and tailored customers. Coca-Cola is still making progress in applying AI for product invention and research & development when associated with its players like PepsiCo.
Element 2: How the firm has managed the recent development of AI with reference to its e-CRM; reintermediation/disintermediation strategies.
e-CRM strategies of Coca-Cola with respect to AI
The organization’s electronic Customer Relationship Management strategy integrates AI-powered solutions to improve customer engagement, personalization, and consumer experience. It has been identified that Coca-Cola has leveraged artificial intelligence to enhance its data collection, targeting efforts, and communication. The AI-driven eCRM strategies of Coca-Cola include:
- Customer Engagement and Retention: With the help of AI’s feature of chatbot and virtual assistant, Coca-Cola has been improving customer experience and interaction by offering quick responses to their queries which improve customer satisfaction (Alnofeli, Akter and Yanamandram, 2023). They also use predictive analysis to examine when consumers are most likely to make a purchase or be involved with content.
- Real-time customer feedback: Through AI, the company is providing real-time feedback to its customers through surveys, social media, and customer service interactions. The data then enables them to familiarise its campaigns and suggestions safeguarding they remain associated with consumer prospects & predilections.
Figure 2: Aspects of Social CRM
(Source: Lecture Notes)
Coca-Cola intermediation strategies
Intermediation denotes the use of several intermediaries such as retailers, brokers, and distributors to ease connections between a brand and its end customers (Paju 2020). It has been identified that Coca-Cola is dealing with both that is traditional as well as digital intermediation strategies, influencing AI to improve these relationships.
Traditional Intermediaries
The identification shows that traditional intermediaries are linked with retailers, wholesalers, and distributors. Coca-Cola is dealing with all these intermediaries which enables them to reach their diverse market worldwide (Patel 2020). While using traditional mediators, the organization employs advanced supply chain and logistics technologies power-driven by AI to achieve inventory levels, predict demand, and modernize product delivery through its intermediaries.
Digital Intermediaries
With the rise of digitalization, Coca-Cola uses AI tools to integrate digital transformation into its business models such as Walmart, Amazon, and so on, where customers can directly purchase Coca-Cola products. The company uses AI tools to track the performance of e-commerce platforms, enhance digital marketing efforts to drive sales and monitor consumer behavior during these stages.
AI’s role in intermediation
It has been examined that artificial intelligence tools help Coca-Cola recognize the most effective intermediaries by analyzing sales performance, delivery times, and consumer behavior (Osayande and Osifo, 2023). The AI tools provide real-time insights about their mediators which helps them to select the best options for a particular region and improve customer engagement.
Intermediation, Disintermediation, and Re-intermediation
Evaluation of the current intermediation strategies
To evaluate the current mediator strategies concerning AI< it is important to consider how the organization uses digital tools & techniques in shaping its relationships with intermediates. The critical analysis includes:
Strengths of Coca-Cola intermediation with AI
With the help of AI, it has been identified that traditional and digital intermediaries enable Coca-Cola to gather and examine data. It enables them to improve pricing and distributing models across different channels (Diener, Luettgens and Piller, 2020). The AI helps to forecast demand, maintain inventory, and enhance product distribution, which results in a smoother supply chain where mediators are better associated with real demand. AI helps is cost reduction as well by streamlining stocks and predicting demand which is beneficial for both the company and its intermediaries.
Weaknesses & Risks
It has been examined that Coca-Cola is dependent on e-commerce platforms such as Walmart and Amazon which takes concerns related to lack of control, data privacy, and marketplace fees over the customer relationships (Merz 2020). As AI enables the organization to make better decisions there is a risk of over-relaying on the automation.
Opportunities
Coca-Cola has an opportunity to expand its relationships with the new digital mediators such as AI-powered smart fridges or vending machines which act as a new intermediatory that provides personalized services and enhances customer engagement. The company further creates AI-powered platforms to improve direct consumer engagement while managing relationships with traditional mediators.
Challenges
The organization might face a challenge to balance human interactions and AI. Over-dependency on artificial intelligence without enough human oversight can lead to consumer dissatisfaction (Withers 2019).
Element 3: How the firm has developed its social media presence and how it uses social media
The use of social media presence for Coca-Cola
Coca-Cola is become a global leader in the beverage industry and its social media presence enables them in marketing, customer engagement, and brand communication (Komańda 2017). The company has been using social media not only as a tool of traditional marketing but also to build strong connections with its audience. The company’s key objectives on social media include:
- The major reason for having a strong presence on social media is brand awareness. It has been identified that Coca-Cola advertises its products through social media platforms like Instagram, Twitter, and Facebook which helps them to connect with the customers directly and gain a strong brand identity.
- Coca-Cola engages with the customers directly by sharing innovative content and inspiring customers to interact with the brand (Huse et al, 2022).
- Social media presence helps the customers to get a quick response from the brand of the queries. It has been identified that it helps to review customer feedback and gain valuable data for the organization.
Social media platforms that Coca-Cola is using
Coca-Cola uses several social media platforms to attract customers and maintain strong relationships with them. It includes:
- Facebook: This is one of the largest social media platforms globally on which Coca-Cola has a strong presence to advertise its products. The identification shows that the organization is using this platform for customer engagement, product promotions, running advertisements, and sharing creative content (Tadele 2019). In terms of audience, they connect with a large number of audiences from younger to old who frequently use Facebook for lifestyle content.
- Instagram: This social media platform has increased the loyal customers for the organization. Coca-Cola runs several marketing campaigns on Instagram such as Coca-Cola India, Share a Coke, and #KindenessStartsWith. Through these campaigns, the company shares premium content including short videos, stories, and images. The identification shows that Instagram is ideal for promoting creative campaigns, influencer partnerships, and brand aesthetics.
- Twitter: It has been identified that Twitter is used by Coca-Cola for an amalgamation of humor, sheering hashtags, and live-event engagement (Serôdio, McKee and Stuckler, 2018). This platform enables them to participate in real-time conversations such as sporting events or global movements. All the updated news and real-time engagement help the organization to reach the current trends globally.
Figure 3: Impact of Social media use on business
(Source: Lecture Notes)
How social media is used by Coca-Cola?
Coca-Cola is using social media far beyond just communication with customers. The organization uses social media in several ways to develop sales, foster engagement, and improve its digital footprint. It includes:
- Brand Campaigns & promotions: The social media platforms used by Coca-Cola for running different campaigns to attract customers (Rambeand Jafeta, 2017). Share a Coke and other campaigns are developed by the organization to inspire user participation, strengthen marketing messages, and create excitement. The company also inspires customers to share their experiences on social media which increases brand loyalty.
- Customer engagement & Communication: Through social media presence, Coca-Cola actively responds to the customer’s feedback to build strong relations with them. They are also using the platforms to monitor mentions of the organization across several platforms.
- Selling online: Social media platforms and online websites are also used for selling the products directly to the customers (Păvăloaia et al, 2019). The brands run limited-time online promotions which attract the customers and increase their interest towards the brand.
- Influencer marketing: The brand works with several influencers on various platforms such as Instagram, YouTube, and so on to approve products and contribute to brand challenges. This enables Coca-Cola to reach a wider, more assorted audience reliably.
Figure 4: Reasons of using social media
(Source: Lecture Notes)
Revenue Models for Coca-Cola using social media
As far as concern for revenue model, the social media presence of Coca-Cola has contributed to generating direct income while others improve the brand’s reach and impact ultimately contributing to buyer loyalty and sales growth. It includes:
- Advertising model: This is the primary revenue model on social media that Coca-Cola is running through advertisement. It is not the direct sales to customers but influencing customers to purchase innovative products while creating innovative content. Some of the examples include Taste the Feeling and other global initiatives that drive revenue indirectly.
- E-commerce Model: This model has been generating direct revenue for the brand as Coca-Cola is selling its products on platforms like Amazon and its own official website (Bragg et al, 2020). Though it is a small portion of the business, it generates direct revenue for the organization.
- Data Monetization: The identification shows that it is an indirect revenue generation model with which Coca-Cola collects appropriate customer insights from social media platforms which enables improvement of its marketing strategies and targeting.
Conclusion
It concludes that Coca-Cola has been using AI to improve the customer engagement with their overall satisfaction. It has been identified that the brand’s intermediatory strategies are evolving in terms of traditional distribution models as well as the rise of digital technologies. The identification shows that Coca-Cola has been using AI to provide personalized services to its customers and make them loyal for the business. Apart from this, social media presence is important which enables the organization to directly connects with the customers. Coca-Cola is using several social media platforms to engage customers and to improve their satisfaction level.