Assignment task:
Conceptual model application:
Discuss what your recommendations in terms of corporate entrepreneurship would be for this company if you were to find empirical support for the hypotheses that have been proposed. How would these hypotheses provide insights into how the company can improve the success of its employees' entrepreneurial activities? Make sure that your recommendations are specific to the context of the selected company.
Brief Description of Company
Coca-cola is one of the world's most popular beverage companies. Having made over 200 different flavors and types, it has become one of the most recognized brands internationally. Coca-cola was made in 1886 by John Pemberton, and held a secret recipe for its classic cola flavor. Coca-Cola has clearly managed to swerve their entrepreneurial issues since 1886, as they have globally expanded, survived the great depression, expanded after WWII, and many more milestones. Despite the lengths which they've gone to keep the company afloat, there are still many entrepreneurial challenges they've had, and continue to face.
One of the entrepreneurial challenges that Coca-Cola has faced is finding alternatives to their cola in order to adapt to the consumer shift towards healthier drinks. This of course stems from the fact that Coca-Cola produces one of the most objectively unhealthy Cola drinks to be made. Coca-Cola has had to make some regulatory changes in order to adjust to the ever growing scrutiny on the health impact of sugary beverages. Another entrepreneurial challenge that Coca-Cola faces is the adjustment to global fluctuations of the economy. Whether this be related to the supply chain of the company, the effects on the company of price changes in other companies, it is without doubt a threat to the company.
Another issue that relates to their existing brand, as well as any attempt to penetrate the water market is their competition. They have competitors like PepsiCo, Nestle, and others with massive capital who can go up against the Cola giant. Nevertheless, Coca-Cola is determined to adapt to this new shift in the consumer market, while resisting competitive attacks in the new market. The entrepreneurial endeavor that Coca-Cola ended up pursuing did end up having some distinction among its competitors.
In the early 2000s they entered the bottled water business with their own brand 'Dasani'. The goal was to compete with existing brands like Perrier and Evian, however they were chastised in the UK (United Kingdom) for water quality issues. In 2007, Coca-Cola purchased vitamin water manufacturer Glaceau. While this was a quality brand and overall, a good acquisition, Coca-Cola struggled to integrate the new product line as well as manage its growth without diminishing the brand's identity. Finally, Coca-Cola wanted to expand into emerging countries such as India. Once again, though the benefits of successfully expanding into new countries were extreme, the company struggled. Due to local rivalries, regulatory concerns and adapting to the various customer preferences, expanding into these countries proved to be quite the challenge. These actions exhibited Coca-Cola's entrepreneurship, but they also confronted the challenges that any huge global firm striving to innovate and develop would face.
With Dasani's trajectory, it is important to ask questions pertaining to certain factors which affect the company's successful qualities. This research paper will enquire into the relationship between the price of water and the consumption of Coca-Cola as well as the relationship between the regulation policy and consumption of Coca-Cola. The research paper will also examine how purchasing power and consumer engagement is related to the correlation of these factors and the consumption of Coca-Cola.
The constructs are:
A: Price and accessibility of water
Definition: The cost and personal involvement associated with purchasing water, which could influence consumer choices regarding beverage consumption.
B: Obesity regulation policy
Definition: Government regulations or policies aimed at addressing and controlling obesity, which may have implications for the consumption of sugary beverages like Coca-Cola.
C: Consumption of Coca-Cola
Definition: The amount or frequency of Coca-Cola consumption by individuals or populations.
D: Purchasing power of people
Definition: The economic ability of individuals or populations to purchase goods and services, including beverages like Coca-Cola.
E: Consumer engagement
Definition: The level of involvement, interest, or interaction that consumers have with the brand, in this case, Coca-Cola.
Now, let's relate these constructs to the hypotheses:
Hypothesis 1:
The positive relationship between the price and accessibility of water (A) and the consumption of Coca-Cola (C).
Hypothesis 2:
The negative relationship between obesity regulation policy (B) and the consumption of Coca-Cola (C).
Coca-Cola has become an important name in the beverage market, especially in less developed countries where the price of water can in some cases be higher than soda. This being said one country which has been faced with a lot of issues regarding the high consumption of Coca-Cola in comparison to water is Mexico. Due to the higher consumption of Coca-Cola than water there, the countries has been faced with an increase in Obesity, which the government had to take action against to protect the future of its population and stop the epidemic. In order to do so the government decided to implement a nationwide tax on drinks which contain forms of added sugar, better known as the "soda tax" (Grogger, 2017). The results of this tax showed no improvement in the level of obesity within the country which is represented by a negative relationship.
Hypothesis 3:
The positive relationship between the price of water (A) and the consumption of Coca-Cola (C) is moderated by the purchasing power of people (D), such that the relationship is stronger for higher levels of purchasing power.
Hypothesis 4:
The negative relationship between obesity regulation policy (B) and the consumption of Coca-Cola (C) is moderated by consumer engagement (E), such that the relationship is weaker for higher levels of consumer engagement.
As stated, the high consumption of Coca-Cola over the years is in great part due to the high demand for the drink from the people who would prefer soda over unsafe water in their country (Ritter et al., 2023). This being said consumer engagement is important to look at, as it will have an impact on whether the "soda tax" will be successful or not in reducing obesity within the country. in this case, the high engagement coming from the consumers regarding the brand proved to have kept or even increased the consumption of soda and in return proved the tax to be useless without having a correct way of rehabilitating people and ensuring they can change their way of living (Gutierrez & Rubli, 2018). In this case, the moderating factor is consumer engagement changes the way people purchase and interact with the company and the way that they consume Coca-Cola, where more consumer engagement leads to more consumption which leads to the tax not working.
These hypotheses suggest relationships and potential moderating factors between the specified constructs in the context of Coca-Cola consumption.
These hypotheses and moderating effects provide a framework for understanding the relationships between the specified constructs and introduce the idea that certain factors (purchasing power and consumer engagement) may influence or modify these relationships. These hypotheses can be tested through empirical research and data analysis to validate or refute the proposed associations.