Coca Cola Vending Machines Case Study

coca Cola a Vending railcar Case Study Problem Statement Coca Cola Co. , the areas largest beverage compevery is facing a overt parity nightmare which nookie eventually put their grass image at stake. Their Chairman and CEO, Ivan Ivester, abruptly announced the introduction of interactive huckster engineering which leave al single diminisheder the price of coke during off-peak buying quantify and augment the price during very hot weather conditions, Ivester virtually confirmed the pitch machines go out be inscribed to the market in brief.The core problem is non if the monger machine should be brought to market but WHEN and what the public relations/ selling strategy should be in the midst of the menstruation media scrutiny to reconstruct unwaveringty with avid coke drinkers and Cokes image. Critical Factors increase the vending machine profit, which has been the main profit resource for the caller-up, serves the purpose of the modern technology. Sales of soft drinks are on the rise. Last year, about 11. 9 % of soft drinks world- wide derived from vending machines. Intelligent vending has already begun in Japan using the same technology.Taking full advantage of the law of tack on and demand, price fluctuations occur all the time in several industries such as the airline and movie industries and are not stark naked to the normal public. It often occurs when the supply for any result is high and the demand is low basic economics. Price discrimination also can occur demographically or geographically and is hard to eliminate from a customers hear once disclosed in a negative light ultimately setting the stage to lose customers to Cokes 1 competitor, PepsiCo. Additionally, their brand image is at stake.Ivesters statements regarding the sunrise(prenominal) technology was disclosed too soon and the response from the public relations team was not sufficient to the loyal coke drinkers and the media, spurring several negative articles and ba cklash from their customers. Strategic Alternatives picking A. Eliminate any option of introducing the interactive vending machines to the public in the near future and create a new public relations and merchandising strategy focusing on Cokes loyalty to its customers to include re-establishing the harbor of drinking coke during extreme hot and cold temperatures.Option B. Proceed with a plan to implement the intelligent vending machines at a subsequently date than plan originally plan, while working to develop a new public relations and marketing strategy to curtail the current media damage, focusing on Cokes loyalty to its customers and re-establish the value of drinking coke during any weather conditions. Evaluation of Alternatives Option A ?Pros Build trust with consumers on same level with competitors regarding technology. Cons This strategy does not coincide with the companys marking plan to pump more deals of the flagship coke into the market, most likely utilizing the hea t sensitive vending machine as cardinal of the core tactics to increase revenues. Option B ?Pros Technology handiness and costs to implement the new vending machines is inexpensive due to move prices of the temperature sensors and computer chips ? Internet connectivity associated with the technology makes it very simplified to track day-to-day and hourly demand based on fluctuations thus making it easy to determine the price point offered in any region ?The new public relations and marketing campaign will slowly domesticate the consumer of the inevitable ? Increase profitability during the peak season due to scorn costs compared to competitors. ?Cons Run the risk of losing loyal customers due to the price gaps spurring many consumers to search for lower price from the competitors vending machine ? Largest competitor, PepsiCo announced they have did not have any plans to introduce the new technology Recommendation Option B Corrective measures essential(prenominal) take pla ce to implement a strategy of price changes.Coke must improve their public image with a well executed public relations and marketing strategy. Justification As a consumer, I am not sure why corporations continue to insult our intelligence. If a product is in the testing stage, then it is just a matter of time before the new technology, (if worthy) is introduced to the market. R in this case, serves the sole purpose of creating new technology in order to maximize efficiency and costs, thus change magnitude profits. And, quite frankly there is nothing wrong with a company trying to maximize profits.Vending machines have remained largely untouched by discounting and although the machines can automatically raise prices for its drinks in hot weather, in my opinion not too many consumers would notice. Coca Cola Co. can also be the first in the SDC market to introduce new innovation that will be able to effectively gauge the buying interests of their customer by the touch of a button. Thi s technology will help to predict sale revenues and take the guesswork out of customers wants and needs.It will also allow Coca Cola Co, to always stay ahead of the competition and remained the leader in the industry. Additionally, price discrimination exists everywhere, across all industries and the new technology will connote increased efficiency for the entire SDC market. The public relations and marketing campaign will help to educate and prepare the average consumer of the inevitable introduction of heat sensitive vending machines. The goal in brainiac for the campaign is to continue to establish Coke as the number one thirst quencher regardless of the weather.