Pest Analysis of Coca Cola

As the leading beverages company in the world, Coca Cola almost monopolizes the entire carbonated beverages segment. Beside it, Coca Cola also maintain their reputation as the leading company in the world using PEST Analysis so that Coca Cola can examine the macro-environment of Coca Cola’s operations.

Political

When Coca Cola had decided to enter a country to distribute the products, Coca Cola was monitoring the policies and regulations of each country. For the example, when entering Moslems country such as Indonesia or Malaysia, Coca Cola followed the regulation by adding “Halal” stamp in each Coca Cola’s products. In this case, Coca Cola has no political issues in this matter.

Economic

Coca Cola also has low growth in the market for carbonated beverages (North America). The market growth was 1% in 2004. For stimulating the growth, Coca Cola had spent high budget of advertisement to endorse the customers.

Social

Nowadays, customers tend to change their lifestyle. Customers more aware about health consciousness by reducing in drinking carbonated beverages to prevent diabetes or other diseases. As a result, Coca Cola’s demand for carbonated beverages has decreased and the revenues also decreased. Thus, Coca Cola diversify the products by adding production lines in tea (Nestea), juices (Minute Maid), mineral water (Dasani and Ades), and sport drinks (Powerade), and others.

Technological

Because of the developing technology, Coca Cola has advanced technology in producing the products. Then, Coca Cola made innovations by giving flavors to the Coke, such as Cherry Coke, Diet Coke, Coca Cola Zero, Coke with Lime, and others. But, the customers still prefer the original taste of traditional coke; it can be seen by the high demands in traditional coke.