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Coca Cola's Localization Strategy
When most multinational corporations like Coca Cola enter foreign markets and implement localization strategy, they do it with reasons. As presented in the case, Coca Cola seeks to set up a corporate image. When it penetrates a local market, it replaces consumers' and government's collision. Implementation of corporate culture, personnel, marketing, and materials localization is useful in establishing the company's public image. The second reason is to dominate the local market rapidly. When multinational corporations enter foreign markets, they tend to lack understanding of the domestic market (Banutu-Gomez, 2012). This makes it challenging to keep up with development and changes of the target market resulting in the loss of vibrant market opportunities.
By implementing a localization strategy, Coca Cola could also choose local human resources to attain research and development, materials and marketing through observing the market via a local subsidiary. The company could be based on market changes and...
By engaging the localization strategy to be close to the market, Coca Cola will occupy a huge market share, which is its important goal (Banutu-Gomez, 2012). In addition, the actualization of management localization will assist Coca Cola Company use the local lower production costs, the comparative advantages of production, reduce inventory and save transport costs; this will be strategic in gaining a competitive advantage.
One of the main reasons for implementing a localization strategy is to reduce business risks. The rapid changes in the international business environment have forced Coca Cola to reduce risks by localizing its operations (Yunker, 2012). For instance, Coca Cola will comfortably adapt to the environment by enhancing the level of localization and integrating the legal and socioeconomic environment of the host country. This will augur with the economic and political situations. In the end, the communication between the subsidiaries and the…
References
Banutu-Gomez, M. (2012). COCA-COLA: International Business Strategy for Globalization. The Business & Management Review, Vol.3 Number 1, November 2012 pp 155-167.
Yunker, J. (2012). Beyond borders: Web globalization strategies. Indianapolis, Ind: New Riders.
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