The Boston Consulting Group (BCG) Matrix is used in analyzing the various products being sold by manufacturers. The market share, potential for growth and annual sales are taken into consideration. Coca-Cola is a multinational company that has been operating for over a century. It supplies its products to hundreds of countries worldwide. To create the matrix, the industry growth and market is drawn on the y-axis and x-axis respectively.

Cash Cows 

The cash cow is a product in a no growth industry with a large market share. It is a designator from the portfolio matrix and is used only to determine the potential of the product. These products have a substantial source of income for the business and generate a fair amount of sales to get ahold of the market share in the local and global markets. The products continuously generate cash in an organization, and the market is a maturation stage for them. As we analyze the Cola market, it has matured to a great extent in the past few years with new companies marketing Cola products. Coca-Cola is operating as a cash cow for the Coca-Cola Company in over 200 countries (Arnett, 2015). It distributes the beverages via bottling partners in many regions; this allows the company to earn a significant amount of revenue. As the bottling industry is a mature one, the company ought to invest in keeping the sales high to generate cash in the large market. The dwindling sales number has been a setback for the company, but, a readjustment in the business strategy has allowed the management to replace itself in the industry. As we look at the current scenario, premium milk can be a cash cow for Coca-Cola.

Stars

The star is a product in a growing industry that has a high market share. This product has the potential to generate a considerable amount of cash in the future due to the preferred position and the possibility of growth in sales as the industry expands (Estrel, 2015). These products are key in having a high market share in comparison to other products, which have lower market shares. When the market is still developing, the stars can add more to the existing market share, and in turn, create a source of revenue for the business. When we study the Coca-Cola Company, the bottled water is categorized as a star, because mineral water is viewed as an ever-evolving product internationally. As the population expands in number, there is more need to produce mineral water, to fulfill the needs of the community. Kinley is the brand name of bottled water by Coca-Cola in Asia, and Dasani is used in the UK and US market (Arnett, 2015). Both products are stars for the Coca-Cola company, as the need for water increases, it will lead to more growth opportunities in the industry. The company is not immune to competition from other bottled water producers, and its expanding market share offers opportunities to get ahold of a significant market share, and eventually expand it further in the future. One concern for the management is to make sure the bottled water is a source of strong sales, as the shifting number of sales can impact the revenues.

Question Marks

A question is a product that has a small market share in the expanding industry. The product is carefully evaluated and determines if there is more marketing required to attract potential customers to result in profits. Products that have a dubious outlook for future success are categorized as question marks (Murphy, 2015). These goods have not succeeded in the market and can be recognized as stars. The market is an ever-expanding one. However, these products have not amassed the benefits. We can consider Minute Maid as the example of such business units that are question marks. In some states, minute maid generates a generous sales volume; as much as $1 Billion is collected. But, the brand has not gained the immense popularity as Coke. Another product is the Diet Coke; it has always faced different prospects for the future. The drink has received favorable responses in the past, but recent data suggests that it is dwindling in popularity. Many health conscious consumers form a chunk of the industry, suggesting the potential of Diet products, but Diet Coke has not been able to maintain its position and gain revenues.

Dogs

A dog in the flat industry has a low market share. With the stoppage of growth in the industry, the customers can be enticed away from customers to improve sales. Due to the transitory nature of the products, and secondary status, the product might result in extreme discounts and heavy marketing. In this case, the companies are recommended terminating the product and perhaps utilize the funds on more promising products. Such products are part of a mature industry, and with less room for growth (Estrel, 2016). The feasibility of these products is questioned as they do not offer substantial revenues to the Corporation. The outlook is dull, requiring a reevaluation of the business operation taking place in this domain. Coca-Cola Life, the brand, was launched to target the low-calorie soda seekers’ market; it was developed with a mixture of the Coke and the Diet version of Coke to offer a relatively healthy beverage option. Despite the many marketing tactics, this brand has underperformed, with decreasing sales of the business unit. Over the years, the soda industry has matured, thus limiting prospects of new products. Coca-Cola life has not gained the expected level of market share. The target market did not accept the new product, thus resulting in a low market share.

Conclusion

1. The Star products of Coca-Cola are Thumbs Up, Maaza, Kinley, and these are the leaders of the business.
2. The Cash Cows of Coca-Cola are Coca-Cola and Limca, which functions as the foundation of the company.
3. The Question Marks of Coca-Cola are Fanta, and Sprite and the investment is high on these products.
4. The Dogs of Coca-Cola are Diet Coke and Minute Maid that are the cash traps of the company.
• Star Strategy: Investing the profits in future growth, to earn more market share and profits.
• Cash Cow Strategy: Using profits to finance new growth and products elsewhere.
• Question Mark Strategy: Investing heavily on products to push them to the star status, and avoid becoming a dog.
• Dog Strategy: Investing to earn market share or considering retracting the investment.

The BCG matrix is one of the best methods for a business portfolio analysis and can help Coca-Cola in implementing the right investment actions.

References

Arnett, G., 2015. How Coca-Cola is fighting against a US public losing the taste for it. The Guardian, [online] February 13. Available at: https://www.theguardian.com/news/datablog/2015/feb/13/coca-cola-us-public-losing-taste [Accessed 21 February 2017].
Estrel, M., 2015. Coca-Cola Boosted by Sales of Tea, Bottled Water. The Wall Street Journal, [online] July 22 Available at: <http://www.wsj.com/articles/coke-profits-jump-20-despite-dollar-impact-1437565369> [Accessed 21 February 2017].
Estrel, M., 2016. Coke Begins to Win Back Investors. The Wall Street Journal, [online] April 16 Available at: <http://www.wsj.com/articles/coke-begins-to-win-back-investors-1460799004> [Accessed 21 February 2017].
Kell, J., 2015. 3 reasons why Diet Coke sales will keep plunging. Fortune, [online] October 23 Available at: <http://fortune.com/2015/10/23/diet-coke-sales-plunge/> [Accessed 21 February 2017].
Murphy, J., 2015. Spork Life: Dysfunction at the heart of Coca-Cola. [online] October 12 Available at:  http://www.news.com.au/finance/business/other-industries/spork-life-dysfunction-at-the-heart-of-cocacola/news-story/e02d21493c23b58c4ff48bb96cbb3de7 [Accessed 21 February 2017].
The Coca-Cola Company. 2015. Form 10-K. Available at: <http://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/investors/2015-annual-report-on-form-10-k.pdf> [Accessed 21 February 2017].

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