Cocacola in Brazil Case Study

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Coca-Cola’s Marketing Challenges in Brazil Case 1. Briefly summarize the major characteristics of the Brazilian soft drink market. * Coca-Cola is one of the most well-known brands in the world. With the development of Coca-Cola’s international marketing, more than 70% of its business income is generated from non-US countries. Among these non-US countries, Brazil is the third largest operation of Coca-Cola Company. In addition, Brazil has a larger population with 18 million than the US. * The purchasing power of the low incomes group in Brazil was revived by the successful economic stabilization plan in the mid-1990s. This economic remediation reduced and controlled inflation rate and also soared the consumption, as the case mentioned that “per capita consumption of soda shot up by 60% between 1994 and 1999” (David Gertner, Rosane Gertner, and Dennis Guthery, 2004, p.2). * In total, there are five social classes (A, B, C, D, and E) in Brazil which are divided by income, education, and material property. People in class A and B represent who own the highest income, the best education and the strongest purchasing power. The population in class D and E process the least purchasing power and almost can’t afford basic goods and services. Consumers in class C are comprised of lower-middle-class workers and 12.6 million Brazilian households. Therefore, consumers in social class C become the main spending power. * For about twenty years, due to the lack of importance of branding among Class C Brazilian consumers, “cheap local products stealing market share of leading global consumer goods was a trend not restricted to Brazil and to the soda market” (David Gertner, Rosane Gertner, and Dennis Guthery, 2004, p.3). Moreover, global brands of different product categories have brought especially in developing countries. * Soft drinks were sold in many kinds

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