Myt PLC Paper 1 VOCAB

MUST KNOW

Multinational Company (MNC)

A business that operates in multiple (2 or more) countries, often with headquarters in one country and factories, offices, or stores in others

Myt PLC has factories on six continents, making it a multinational company

Internal Growth

Growth that happens when a business expands by increasing sales, opening new stores, or launching new products, rather than merging with or buying other businesses. It is also known as organic growth

Myt expanded its product range from just one drink (root beer) to over 30 different drinks

External Growth

Occurs when a business expands by merging with or acquiring (buying) another business

Myt acquired Lotssa Coffee and Honest Water, growing its business through external growth

Portfolio

The range of products or services a business offers

By 2020, Myt had built this of over 30 different drinks, meaning it sells many different types of beverages

Diversification

When a company expands into new industries or product markets to reduce risk and increase profits

Myt used this by buying a coffee chain (Lotssa Coffee) and a bottled water company (Honest Water), expanding beyond soft drinks

Manufacturer

A company that processes, produces and packages a product using raw materials and/or components

Honest Water processes their bottled drinking water, likely competing with brands like Evian or Dasani

Modernisation

Updating factories or equipment to improve efficiency, quality, or environmental impact
Myt wants to _______ its factories to make them greener and more sustainable

Green Factories

Factories that use less energy, produce less waste, and are more environmentally friendly

Myt plans to make its factories greener by using renewable energy or reducing water and plastic waste

Healthy Snacks Market

This market includes snacks made with natural ingredients, low sugar, or added health benefits

Myt wants to enter this particular market, possibly by launching low-sugar, high-protein, or organic snacks

Corporate Social Responsibility (CSR)

A business's efforts to act ethically and contribute positively to society, such as reducing pollution, treating workers fairly, or supporting charities

Myt plans to improve *this*, which could mean cutting plastic waste, using ethical sourcing, or supporting local communities

Avatar

A digital picture or character that represents a person in an online world, such as a website, video game, or virtual meeting

Trends: Big soft drink brands use _____ in online marketing and virtual events to connect with customers. E.g. Coca-Cola has experimented with virtual worlds like Second Life, where people could design digital vending machines

Biodegradable

This type of material can break down naturally into the environment without causing harm, usually with the help of bacteria or fungi

Trends: Soft drink companies are looking to reduce plastic waste by using ________ materials. Coca-Cola and PepsiCo have introduced plant-based bottles, designed to break down easily. Experts say these bottles need the right conditions to fully break down so recycling is still important

Chain (of a business)

A group of shops, restaurants, or factories that belong to the same company and sell the same products

Trends: Big brands like PepsiCo run large chains of bottling factories and distribution centres to sell drinks worldwide. Delays in shipping and rising costs have made companies rethink this - some soft drinks firms are now setting up local factories to avoid these issues

Pressure Group

An organisation that tries to influence businesses or governments to change their policies on issues like the environment, human rights, or animal welfare

Trends: Greenpeace and other environmental groups have criticised soft drink companies for creating too much plastic waste. Coca-Cola has promised to make its packaging 100% recyclable by 2025 and use more recycled plastic. Activists say companies should move away from plastic and focus on refillable bottles

Recycling

The process of collecting and reusing materials, like plastic and glass, to make new products instead of throwing them away

Trends: Many soft drink companies are working to cut down on waste, e.g. Coca-Cola's 'World Without Waste' plan aims to use the same amount of bottles it sells by 2030. Some brands have refill schemes to encourage bottle reuse. European governments are introducing deposit schemes where customers get money back when bottles are returned

Social Media Influencer

A person who has a big online following and can influence people's buying decisions by promoting products
Trends: Soft drink brands work with influencers on Instagram, TikTok, and YouTube to market their products. Health-focused drinks, like prebiotic sodas Olipop and Poppi, are popularised by influencers recommending them as healthy drinks. However, 'de-influencing' encourages people to buy less, which may change brand advertising in future

Growth and business expansion

-Internal growth: Myt expanded its product range from a single root beer to a portfolio of over 30 drinks

-External growth: The company used acquisitions to diversify, taking over Lotssa Coffee (LC) and Honest Water (HW)

-Diversification: Myt is expanding beyond soft drinks into coffee, bottled water, and potentially healthy snacks

Marketing and promotion

1 Use of social media influencers: Myt engages influencers to promote its drinks, a common modern digital marketing strategy
2 Advertising innovations: The company is exploring computer-generated avatars in advertising, showing a shift towards AI and virtual marketing

Ethical and health considerations

1 Obesity and diabetes concerns: Myt's products are high in sugar and caffeine, leading to criticism over health risks
2 Sugar substitutes and health risks: Even diet drinks have raised health concerns, affecting consumer perception
3 Reducing sugar and caffeine levels: The company is responding to public health concerns by modifying its products

Corporate social responsibility (CSR)

1 Environmental sustainability: Plans to modernise factories and make them green suggest a focus on reducing the company's environmental impact
2 Social responsibility: Myt's CSR improvements may involve ethical sourcing, employee well-being, and responding to health concerns
3 Bottled water industry Issues: The acquisition of Honest Water raises sustainability concerns, as bottled water production often contributes to plastic waste and water resource depletion

Business ownership and structure

Public limited company (PLC): Myt is a publicly held company, meaning it has shareholders and must focus on profitability while balancing stakeholder interests

Changing consumer preferences

1 Healthier options: Consumers are demanding healthier drinks and snacks, leading Myt to explore healthy snacks and reformulate its drinks
2 Coffee market expansion: The acquisition of Lotssa Coffee indicates a shift towards the growing coffee culture and demand for premium beverages

Technology and innovation

1 Factory modernisation: Myt is investing in green technology to reduce its environmental footprint
2 AI and digital marketing: The use of avatars in advertisements reflects a move towards automation and AI-driven marketing

Operations management

1 Operations methods
-Myt produces over 30 drinks, meaning it may use batch or mass production methods
-If Myt expands into healthy snacks, it must decide between job, batch, or flow production
2 Location
-Myt owns factories on six continents, so it must carefully decide where to locate new production facilities
-It may also consider outsourcing, offshoring, reshoring, or insourcing to improve efficiency
3 Break-even analysis
-Myt's investment in modernisation and new product lines requires careful financial planning
-Break-even analysis can help Myt determine if reducing sugar and caffeine or entering the healthy snacks market will be profitable
4 Circular business models
-Myt's plan to make factories greener fits into a circular business model, reducing waste and improving sustainability
-Investing in biodegradable packaging and recycling initiatives aligns with CSR goals

SWOT Analysis Strengths

✔ Strong brand recognition
Myt PLC is a multinational company with operations on six continents, giving it a strong global presence
✔ Large product portfolio
Initially producing one root beer, Myt now sells over 30 different drinks, catering to different consumer preferences
✔ Social media marketing
Myt effectively uses social media influencers to reach younger customers and increase engagement
✔ Plans for modernisation
Myt intends to make its factories greener, which could improve cost efficiency and brand reputation

SWOT Analysis Weaknesses

❌ Health concerns about sugar and caffeine
Many of Myt's drinks are high in sugar and caffeine, which is linked to obesity and diabetes. This may negatively impact sales
❌ Risk of backlash from sugar substitutes
While sugar-free alternatives help reduce sugar content, some consumers worry about the health effects of artificial sweeteners
❌ High costs of modernisation
Making factories greener and investing in digital advertising (avatars) could be very expensive in the short term
❌ Challenges of entering new markets
The healthy snacks market is highly competitive, and Myt may struggle to differentiate itself from established brands

SWOT Analysis Opportunities

✔ Growing demand for healthier drinks
Consumers are increasingly choosing low-sugar, caffeine-free, and functional beverages
✔ Expanding bottled water market
The bottled water industry is expected to grow, and Honest Water gives Myt a foothold in this sector
✔ Sustainability as a competitive advantage
Reducing waste, carbon emissions, and plastic use could attract environmentally conscious customers
✔ Technology in marketing
The use of computer-generated avatars in advertising could give Myt a stronger digital presence

SWOT Analysis: Threats

❌ Strict government regulations
Many countries are taxing high-sugar drinks, and some might introduce limits on caffeine levels
❌ Strong competition
Myt faces competition from PepsiCo, Coca-Cola, and health-focused beverage brands
❌ Consumer trust issues
If the taste of reduced-sugar drinks changes, some loyal customers may switch to competitors
❌ Pressure groups and activists
Myt could face criticism from health and environmental organisations if changes are not meaningful

STEEPLE Analysis Social

Key Trends: Increasing consumer demand for healthy drinks and snacks
Examples: Consumers are more aware of obesity, diabetes, and caffeine addiction, pushing Myt to reduce sugar and caffeine
Key Trends: Growing environmental awareness
Examples: Consumers want biodegradable packaging, ethical sourcing, and sustainable business practices
Key Trends: Changing consumer habits
Examples: Many customers prefer functional drinks (prebiotics, vitamins, low-calorie options) instead of traditional soft drinks

STEEPLE Analysis Technological

Key Trends: Use of AI and avatars in advertising
Examples: Myt is investing in computer-generated avatars to create more interactive and engaging digital marketing campaigns
Key Trends: Factory modernisation
Examples:
-Focus on making Myt factories greener
-Possible use of energy-efficient production methods and recycling initiatives

STEEPLE Analysis Economic

Key Trends: Global inflation and rising costs
Examples: The cost of raw materials, packaging, and transportation is increasing, which could reduce profits
Key Trends: Premium pricing for healthier drinks
Examples: Healthier and eco-friendly drinks often cost more to produce, but consumers may be willing to pay higher prices for sustainable and healthy products
Key Trends: Potential financial risks of acquisitions
Examples: Expanding into coffee and bottled water requires heavy investment, which may take time to become profitable

STEEPLE Analysis Environmental

Key Trends: Sustainability goals and green factories
- Examples: Myt is investing in modern, energy-efficient production to reduce its environmental impact

Key Trends: Recycling and biodegradable packaging
- Examples: Governments and consumers are demanding less plastic waste, and Myt may develop more sustainable packaging

Key Trends: Ethical sourcing concerns
- Examples: Bottled water businesses sometimes face criticism for using too much groundwater, which could create negative publicity for Honest Water

STEEPLE Analysis Political

Key Trends: Government health regulations
Examples: Many governments have introduced sugar taxes and caffeine limits, forcing Myt to reformulate its products
Key Trends: Trade policies and tariffs
Examples: Myt operates globally, so trade restrictions, import/export taxes, and geopolitical instability could impact its supply chain

STEEPLE Analysis Legal

Key Trends: Laws on advertising and food labelling
Examples: Regulations on how Myt can market "healthier" drinks might limit advertising claims
Key Trends: Data privacy laws
Examples:If Myt collects customer data for targeted digital marketing, it must follow data protection laws

STEEPLE Analysis Ethical

Key Trends: Corporate Social Responsibility (CSR)
Examples: Myt is focusing on greener factories, healthier drinks, and sustainable products
Key Trends: Ethical issues with artificial sweeteners
Examples: Some consumers worry about the long-term health effects of sugar substitutes, which could cause controversy
Key Trends: Avoiding "greenwashing"
Examples: If Myt claims to be eco-friendly but does not make real changes, it could lose consumer trust

Boston Consulting Group (BCG) Matrix
- Market share High

-Market growth High:

Stars
Bottled water (Honest Water) could be a significant brand within a growth market
Myt may continue to invest in these in the hope that they will become cash cows

Boston Consulting Group (BCG) Matrix
Market share Low -Market growth High:

Question Marks
Lotssa Coffee needs investment to grow, though there is significant risk involved
Competitive pricing and aggressive promotional activity are likely to be expensive

Boston Consulting Group (BCG) Matrix
Market share High -Market growth Low:

Cash Cows
MYt's root beer and top-selling soft drinks are established brands that could generate cash to support other products

Boston Consulting Group (BCG) Matrix

- Market share Low

- Market growth Low:

Dogs
High-sugar, high-caffeine drinks may decline in popularity
Myt may decide to divest these products

Boston Consulting Group (BCG) Matrix

Myt PLC could use this tool to assess its product portfolio

Comparing market growth with the market share of each of its products could determine a range of suitable strategies

Ansoff Matrix

Myt could use this tool to determine suitable strategies to grow, depending on the level of risk it is willing to accept

Market Penetration

This strategy focuses on increasing sales of current products in the same markets by improving marketing efforts, adjusting pricing, or increasing customer loyalty

Application to Myt PLC:

- 1 Social media influencer marketing: Myt is already using influencers to promote its drinks, which encourages existing customers to buy more

- 2 Product reformulation: Myt is reducing sugar and caffeine levels, but the products remain the same. This helps retain existing customers while appealing to health-conscious buyers

- 3 More aggressive promotions and advertising: Myt could increase advertising spending, use AI avatars and create interactive social media campaigns to reinforce brand loyalty

Market Penetration Challenges

❌ Changing consumer preferences
Some customers may not like the reformulated drinks if the taste is different
❌ Health concerns still exist
Even with lower sugar, Myt may still face criticism for artificial sweeteners

Market Penetration Potential Impact

1 If successful, Myt can increase its market share and strengthen its existing brand presence

2 Maintaining sales of core drinks (like its original root beer) is crucial while expanding into new markets

Product Development

This strategy involves introducing new products to existing customers, keeping them engaged with the brand

- Application to Myt PLC:
1 Entry into the healthy snacks market: Myt is developing new snack products targeted at health-conscious consumers

2 Launch of lower-sugar and caffeine-free versions: Reformulating drinks to meet government regulations and consumer demand for healthier options

3 Introduction of prebiotic or functional drinks: Given industry trends, Myt could develop prebiotic or vitamin-enhanced drinks, similar to brands like Olipop

Product Development Challenges

❌ Expensive
Research, testing, and market launch costs can be high

❌ Competition is strong
PepsiCo, Coca-Cola, and smaller health-focused brands are also expanding into healthier beverages

❌ Customer acceptance
New products must be well-received, or they could fail in the market

Product Development Potential Impact

- If successful, Myt can capture more market share among health-conscious consumers

- Expanding its product range beyond carbonated soft drinks reduces risk if traditional soda sales decline

Market Development

This strategy involves taking current products and selling them in new geographic or demographic markets
-Application to Myt PLC
1 Global expansion of Lotssa Coffee: With over 4,000 outlets in 35 countries, Myt could expand its coffee business into more regions
2 Expansion of Honest Water: Bottled water demand is growing, so Myt could expand sales into developing markets where clean drinking water is a concern
3 New target audiences for healthier drinks: Myt's lower-sugar drinks could appeal to older consumers or health-conscious millennials

Market Development Challenges

❌ Cultural and legal differences
Different countries have different health regulations and consumer preferences
❌ Logistics and supply chain issues
Expanding internationally requires strong distribution networks and brand positioning

Market Development Potential Impact

- If successful, Myt can increase revenues by entering high-growth markets where demand for bottled water and coffee is rising

- Expanding Lotssa Coffee and Honest Water allows Myt to diversify income streams beyond soda sales

Diversification strategy

The riskiest strategy as it involves launching new products in unfamiliar markets

Application to Myt PLC:

1 Acquisition of Lotssa Coffee (LC): Myt entered the coffee shop market by acquiring Lotssa Coffee, a chain with 4,000 stores in 35 countries

2 Acquisition of Honest Water (HW): Bottled water is a completely different industry from soft drinks, requiring different supply chains, packaging, and branding strategies

3 Exploring the healthy snacks market: Myt is expanding beyond beverages into food products, competing with health-focused snack brands

4 Investing in computer-generated avatars for advertising: This is a new digital marketing approach that could differentiate Myt from competitors

Diversification strategy Challenges

❌ High risk
Entering completely new markets requires significant investment, research, and strong branding

❌ Uncertainty in success
Not all such strategies succeed (e.g., Coca-Cola's past failure with its energy drink brands)

Diversification strategy and its Potential Impact

If successful, Myt could reduce its reliance on soft drinks
Acquiring Lotssa Coffee and Honest Water expands Myt's brand influence across multiple industries

Decision Trees

A quantitative method of tracing the outcomes of a decision so that the most profitable decision can be identified

- Research-based estimates and probabilities are used to calculate likely outcomes

- The net gain from a decision can be identified and used to consider whether an investment is worthwhile

- Myt PLC's senior managers could use this tool to help make key choices such as:

• Investing in factory modernisation (cost vs. long-term savings)

• Expanding Lotssa Coffee globally (profit potential vs. risk)

Advantages of using decision trees in the decision making process

- Constructing this may reveal options that haven't previously been considered

- Managers are forced to consider the risks associated with their choice, ahead of implementation

- The quantitative approach requires deep research to be carried out

Limitations of Using Decision Trees

- Constructing this tool (that can support effective decision-making) requires skill to avoid bias and takes significant amounts of time to gather reliable data

- This tool is constructed using estimates which rarely take full account of external factors and cannot include all possible eventualities

- Qualitative elements such as human resource impacts are not considered, which may affect the probability of success of a decision

- The time lag between the construction of this tool and the implementation of the decision is likely to further affect the reliability of the expected values

Circular Business Models

1 An approach to business designed to minimise the consumption of scarce resources and reduce waste whilst maximising the use and value of resources
-Materials and products are recycled, reused, or regenerated rather than being disposed of after use
-Also known as the cradle-to-cradle approach

2 In this model, products are designed with durability, reparability, and recyclability in mind
-The focus is on creating products that can be easily disassembled and their components reused or recycled
-This promotes the use of renewable resources, reduces dependence on finite resources and minimises a businesses environmental impact

3 Myt's CSR efforts align with these particular models
-Modernising factories to be greener reduces waste
-Using recyclable packaging supports sustainability
-Lowering sugar and caffeine improves Myt's ethical reputation

Advantages of Myt's circular business model

Reduced waste generation
Decreased reliance on finite natural resources
Cost savings through resource efficiency
Enhanced brand reputation
Increased resilience to resource scarcity and price volatility

The soft drinks market

The global soft drinks market is experiencing significant growth and change, influenced by health trends, new products, and changing consumer tastes

Analysis of the soft drinks market

- Market Size and Growth
- Leading Companies and Brands
- Product Types and Consumer Trends
- Market Dynamics and Challenges
- Emerging Markets and Regional Insights

The soft drinks market: Market Size and Growth

In 2024, the global soft drinks market was valued at approximately $465.36 billion. It is expected to grow to $491.36 billion in 2025, with an annual growth rate of 5.6%
By 2029, the market is expected to reach around $598.26 billion, driven by increasing demand for non-alcoholic beverages and innovative products

The soft drinks market: Leading Companies and Brands

Major players in the market include The Coca-Cola Company, PepsiCo, and Keurig Dr Pepper
In 2024, The Coca-Cola Company held a 17% share of the global retail volume, maintaining its leadership position
PepsiCo and Keurig Dr Pepper also have significant market shares, with popular brands like Pepsi, Dr Pepper, 7Up, and Snapple

The soft drinks market Product Types and Consumer Trends

Consumers are increasingly choosing healthier and functional beverages
Energy drinks and bottled water are leading growth, reflecting a shift towards health-focused options
Prebiotic sodas, which support digestive health, are becoming popular. Brands like Olipop and Poppi have gained attention in this area
The Coca-Cola Company plans to launch "Simply Pop," a line of prebiotic sodas in flavors like Strawberry and Pineapple Mango, targeting health-conscious consumers

The soft drinks market Market Dynamics and Challenges

1 Traditional carbonated soft drinks (CSDs) face challenges due to health concerns about high sugar content and artificial additives
-This has led to a decline in CSD consumption, prompting companies to develop low- or no-calorie alternatives and functional beverages
-For example, The Coca-Cola Company reported a 4.2% increase in net revenue in the fourth quarter of 2024, driven by higher prices and steady demand, especially in emerging markets like India
2 The industry also faces regulatory pressures and consumer concerns related to health and environmental sustainability
-Discussions about implementing sugar taxes and reducing plastic usage are influencing company strategies and product formulas
-For instance, proposed policies targeting high-fructose corn syrup (HFCS) could lead companies to reformulate products and explore alternative sweeteners

The healthy snacks market definition

The global healthy snacks market is experiencing significant growth, driven by increasing health awareness and changing consumer preferences

The healthy snacks market Market Size and Growth

In 2024, the global healthy snacks market was valued at approximately $91.1 billion
Projections indicate that by 2033, the market will reach around $147.1 billion, growing at a rate of 5.19%
This growth is attributed to busy lifestyles, urbanisation, and a demand for convenient, nutritious snack options

The healthy snacks market: Leading Companies and Brands

Leading companies are continually innovating to meet the demand for healthier snack options
Major players in the healthy snacks industry include
-General Mills, Inc.: Known for brands like Cheerios and Nature Valley, offering a range of cereals and granola bars.
-PepsiCo, Inc.: Offers healthy snack options through brands like Quaker, providing products such as oatmeal and rice cakes.
-Nestlé S.A.: Produces nutritious snacks under brands like Gerber, focusing on healthy options for children.
-Unilever: Offers health-orientated snack products through brands like Ben & Jerry's, which has introduced lower-calorie ice cream options.

• The Kraft Heinz Company: Provides a variety of snack products, including those under the Planters brand, known for nuts and trail mixes.

The healthy snacks market: Product Types and Consumer Trends

Consumers are increasingly seeking snacks that align with health and wellness goals. Trends in the healthy snacks market include:

1 High-Protein Snacks: Products like protein bars, nuts, and meat-based snacks are gaining popularity as consumers look to increase protein intake

2 Plant-Based Snacks: Items made from lentils, chickpeas, and other plant sources cater to the growing number of consumers adopting vegetarian or vegan diets

3 Gut-Health-Focused Snacks: Prebiotic and probiotic snacks are emerging, aiming to support digestive health. For example, Coca-Cola has introduced a line of prebiotic sodas under its Simply brand to compete with startups like Olipop and Poppi

4 Low-Carb and Keto-Friendly Snacks: With the revival of low-carb diets, snacks that fit ketogenic guidelines, such as cheese crisps and nut-based bars, are becoming more prevalent

The healthy snacks market: Market Dynamics and Challenges

The healthy snacks industry faces several challenges:
1 Balancing Health and Taste: Consumers desire snacks that are both healthy and enjoyable, prompting companies to innovate without compromising on flavour.
2 Sustainability Concerns: There is growing pressure to adopt environmentally friendly practices, including sustainable sourcing and packaging.
3 Regulatory Hurdles: Navigating different countries' regulations regarding health claims and ingredient approvals can be complex for multinational companies.

The bottled water market

The global bottled water market has seen significant growth in recent years, driven by increasing health awareness, concerns over tap water quality and a preference for convenient hydration options

The bottled water market: Market Size and Growth

In 2024, the global bottled water market was valued at approximately $335.5 billion
Projections indicate that by 2034, the market will reach around $565.23 billion, growing at a rate of 5.35%
This expansion is attributed to rising consumer demand for safe and healthy drinking water, especially in regions where tap water quality is questionable

The bottled water market: Leading Companies and Brands

The market is dominated by several key players, including
1 Nestlé S.A.: Owner of brands like Perrier, San Pellegrino, and Vittel
2 The Coca-Cola Company: Produces bottled water under brands such as Dasani and Smartwater
In 2024, Coca-Cola faced legal challenges in Los Angeles County over allegations of misleading consumers about the recyclability of their plastic bottles
3 PepsiCo, Inc.: Offers bottled water through brands like Aquafina
Similar to Coca-Cola, PepsiCo was also implicated in the Los Angeles County lawsuit concerning plastic bottle recyclability claims

The bottled water market Product Types and Consumer Trends

Consumer preferences are shifting towards premium and functional bottled water options
The premium bottled water segment was valued at $38.6 billion in 2024 and is projected to grow at a rate of 6.7% from 2025 to 2034
This growth is driven by demand for products perceived as healthier and of higher quality, such as spring water, which reached $10.2 billion in 2024

The bottled water market: Market Dynamics and Challenges

1 The bottled water industry faces several challenges
Environmental Concerns
The production and disposal of plastic bottles contribute to pollution and greenhouse gas emissions
In 2024, Los Angeles County sued major bottled water companies over misleading claims about plastic recyclability, highlighting the growing scrutiny over environmental impacts
2 Resource Exploitation
There are concerns about the extraction of large volumes of water by multinational corporations, potentially affecting local water supplies
In 2024, reports emerged of foreign firms extracting billions of litres from UK aquifers for bottled water production, raising questions about sustainability and local water security
3 Health and Safety Issues
Incidents of contamination have raised questions about the safety of bottled water
For instance, in 2024, Perrier faced concerns after traces of fecal matter were found in one of its source springs, leading to the suspension and destruction of over 2 million bottles

Industry Trends: Improving corporate social responsibility

In recent years, companies that produce soft drinks, bottled water, and snacks have been working to improve their corporate social responsibility (CSR)
This means they are trying to act in ways that are good for society and the environment
These efforts can affect their reputation, sales, and profits

Improving CSR Soft Drinks Manufacturers

Coca-Cola
The company has pledged to replace all the water it uses in its beverages and production processes. This involves reducing water usage, recycling water safely back into the environment, and supporting local water projects. These efforts aim to improve the company's image and address environmental concerns

However, Coca-Cola has faced criticism for reducing its environmental targets related to recycling and reuse of bottles, which has led to negative feedback from environmental groups

Improving corporate social responsibility: Bottled Water Manufacturers

1 Belu
This UK-based company donates all its profits to the charity WaterAid, supporting clean water projects
Belu also focuses on sustainability by using recycled materials for its bottles and investing in eco-friendly filtration systems
These actions have enhanced its reputation as an ethical brand
2 Nestlé
The owner of brands like Perrier and San Pellegrino, Nestlé has faced legal issues in France for using unauthorized methods to treat bottled water and extracting water from unauthorized wells
In response, Nestlé agreed to pay €2 million to avoid trial and committed to investing over €1 million in environmental restoration
While these steps aim to address the violations, the company has received criticism for its practices, which may impact its public image

Improving corporate social responsibility: Snack Manufacturers

Snack Manufacturers
Thankyou: An Australian social enterprise, Thankyou sells snack products and uses the profits to fund safe water, hygiene, and food security programs in various countries

This approach has built customer trust and loyalty, as consumers feel they are contributing to positive causes through their purchases

Positive Impacts of CSR Initiatives

Companies engaging in CSR can see improved public perception, increased customer loyalty, and potentially higher sales
For example, brands that support environmental sustainability or charitable causes often attract consumers who value these efforts

Negative Impacts of CSR Initiatives

If CSR initiatives are perceived as insincere or if companies fail to meet their commitments, they can face public backlash

For example, Coca-Cola's decision to lower its environmental targets led to criticism from environmentalists, potentially harming its reputation

Making factories greener

In recent years, companies that produce soft drinks, bottled water, and snacks have been working to make their factories more environmentally friendly, or "greener"
These efforts aim to reduce harm to the environment and can affect the company's reputation, sales, and profits

Making factories greener: Soft Drinks Manufacturers

Coca-Cola
The company has launched the "World Without Waste" initiative, aiming to collect and recycle the equivalent of every bottle it sells globally by 2030
This involves improving recycling processes and encouraging consumers to recycle more
These actions are intended to reduce environmental impact and enhance the company's public image
However, Coca-Cola has faced criticism for reducing its environmental targets related to recycling and reuse of bottles, which has led to negative feedback from environmental groups

Making factories greener Bottled Water Manufacturers

Nestlé
The company has committed to managing water resources responsibly
This includes treating water with care and working closely with local communities to protect water sources
These efforts aim to ensure the availability of water resources and improve the company's reputation
However, Nestlé has faced criticism for extracting large amounts of water from local sources, which has led to negative perceptions in some communities

Making factories greener Snack Manufacturers

1 Grupo Bimbo
This large bakery company has taken several steps to make its factories greener
They have invested in renewable energy, such as wind farms, to power their operations and use solar panels on their buildings to generate electricity
Additionally, Grupo Bimbo has developed biodegradable and compostable packaging to reduce waste. These actions have likely improved their reputation and could lead to cost savings in the long term
2 Shearer's Foods
This snack company has built a manufacturing plant that meets high environmental standards
They focus on reducing waste by recycling materials and converting used cooking oil into biodiesel fuel
These efforts help minimize their environmental footprint and can enhance their public image

Positive Impacts of Greener Factories

-Making factories greener can lead to a better public image, attracting customers who care about the environment
-It can also result in cost savings over time, as using renewable energy and reducing waste can lower operating expenses
-For example, companies that invest in energy-efficient technologies may see reduced utility costs

Negative Impacts of Greener Factories

-Implementing green technologies can require significant upfront investment, which might affect short-term profits

-Additionally, if companies make environmental claims but fail to meet their targets, they can face public criticism, harming their reputation

-For instance, if a company sets ambitious recycling goals but does not achieve them, it may be viewed negatively by consumers and environmental groups

Reducing sugar and caffeine

Soft drink manufacturers have been reducing sugar and caffeine in their products to address health concerns and meet changing consumer preferences
This shift aims to combat issues like obesity and diabetes, which have been linked to high sugar intake and to offer alternatives for those sensitive to caffeine
These changes also help companies comply with government regulations and maintain competitiveness in the market

Reasons for Reducing Sugar and Caffeine

1 Health Concerns: High sugar consumption is associated with obesity, diabetes, and other health problems. Reducing sugar content helps address these issues
2 Consumer Demand: Many consumers are seeking healthier beverage options with less sugar and caffeine
3 Regulatory Pressure: Governments are implementing taxes and regulations to encourage lower sugar content in beverages

Examples of Product Reformulations: Reasons for Reducing Sugar and Caffeine

-Coca-Cola: Introduced "Simply Pop," a prebiotic soda with no added sugar, sweetened with monk fruit, and containing 6 grams of fibre per can

• PepsiCo: In regions like Sweden, the Netherlands, and the UK, PepsiCo has reduced sugar in its standard Pepsi by replacing it with artificial sweeteners such as Acesulfame K and Sucralose
  -Irn-Bru: In response to the UK's sugar tax, Irn-Bru reduced its sugar content to less than 5 grams per 100ml in 2018, making it exempt from the tax

Use of Artificial Sweeteners: Reasons for Reducing Sugar and Caffeine

-To maintain sweetness while reducing sugar, manufacturers often use artificial sweeteners like aspartame, sucralose, and saccharin
-These substitutes provide sweetness without the calories of sugar
-Recent studies have raised concerns about the potential health effects of artificial sweeteners
1 Cardiovascular Risks: A Swedish study found that aspartame might increase insulin levels, leading to the development of larger and more fatty plaques in arteries, which can contribute to heart disease
2 Metabolic Effects: The World Health Organisation (WHO) has indicated that long-term use of non-sugar sweeteners may not aid in weight control and could increase the risk of type 2 diabetes and cardiovascular diseases
3 Cancer Concerns: The WHO's International Agency for Research on Cancer (IARC) classified aspartame as "possibly carcinogenic to humans," based on limited evidence linking it to liver cancer

Impact on Competitiveness and Popularity: Reasons for Reducing Sugar and Caffeine

1 Market Performance: Studies indicate that sugar-reduced products perform comparably to their original versions, suggesting that health-conscious consumers appreciate these options
2 Taste Challenges: Reducing sugar can alter the taste of beverages, potentially affecting consumer satisfaction. Manufacturers must balance health benefits with flavor to maintain popularity
3 Regulatory Compliance: Adjusting sugar and caffeine content helps companies avoid taxes and meet government standards, which can positively impact their financial performance and public image

Using avatars in promotional activities

In recent years, soft drinks, bottled water, snacks, and coffee companies have started using this in their advertising campaigns

These help attract younger audiences, make brands more fun and interactive and allow companies to connect with customers online in new ways

Using avatars in promotional activities Examples

- Coca-Cola
In 2025 the "Real Connections" campaign is focused on bringing people together in real life
While the campaign emphasises real-life relationships, it also uses digital avatars and virtual experiences to make advertising more engaging

- KFC: In 2019, KFC introduced a virtual Colonel Sanders avatar called "V.I.C." (Virtual Influencer Colonel)
This modern, digital version of the brand's founder appeared on Instagram and social media, interacting with fans
It was part of a campaign to make KFC feel more modern and exciting

- Smartwater (owned by Coca-Cola) used a virtual version of actress Gal Gadot in its 2023 advertising campaign
It combined real video with digital effects to create an eye-catching commercial

- McDonald's: In 2025, McDonald's introduced the "Taste the Future" augmented reality (AR) experience
Customers could scan McDonald's packaging with a mobile app to see virtual characters, play digital games, and watch digital chefs cook their food in AR This helped make eating at McDonald's more fun and interactive

- Oreo has created interactive online content and partnered with digital influencers to promote new flavours and limited-edition cookies. Oreo's marketing often includes playful, animated characters that act like avatars

- Starbucks has experimented with personalised digital experiences, where customers can create their own avatars in the Starbucks app. Though Starbucks has not used computer-generated influencers, it has embraced digital marketing techniques to make its brand more interactive and engaging

- Chamberlain Coffee: This coffee brand was founded by influencer Emma Chamberlain and has used her digital persona in advertising. The company often creates cartoon-style animated versions of Emma in marketing campaigns.

How much do these avatars cost?

Creating computer-generated avatars can be expensive, depending on how realistic and advanced they are
A simple animated avatar for social media may cost around $10,000 to $50,000
A high-quality 3D avatar for big advertising campaigns can cost $100,000 to $500,000 or more
If a company wants the avatar to interact with customers online (like a chatbot), the cost can be even higher because it requires artificial intelligence
For big brands, these costs are worth it because avatars help them connect with customers, make ads more fun, and keep up with digital trends.

Explain one reason why Myt PLC might want to use computer-generated avatars in its advertising

Myt PLC might use this in its advertising to create engaging and innovative digital marketing campaigns that appeal to younger consumers . Alongside Myt's existing use of social media influencers, this could enhance its online presence and brand engagement

Explain one reason why Myt PLC's decision to acquire Lotssa Coffee (LC) might be considered diversification

Myt PLC's decision to acquire Lotssa Coffee (LC) might be considered ________ because it involves expanding into a new market or product area that is different from its core business. This aligns with Ansoff's Matrix, where _______ refers to a strategy of entering new industries to reduce dependence on a single market. By acquiring LC, Myt PLC is reducing risks associated with relying on its existing product range and increasing potential revenue streams.

Explain one possible challenge Myt PLC could face when reducing caffeine and sugar levels in its drinks [2]

One possible challenge Myt PLC could face when reducing caffeine and sugar levels in its drinks is consumer resistance. Many customers may be accustomed to the original taste and stimulating effects of caffeine and sugar, leading to potential dissatisfaction and decreased sales. If loyal consumers perceive the new formula as less appealing, they might switch to competitors, negatively impacting Myt PLC's brand loyalty and market share.

Explain one impact that Myt PLC's acquisition of Lotssa Coffee (LC) could have on its brand positioning [2]

Could reposition Myt’s brand towards a more premium or diversified offering by expanding into the coffee market. This could enhance its reputation as a broader food and beverage company rather than being solely associated with its original products, potentially attracting a new customer base while also differentiating itself from competitors.

Explain one way in which Myt PLC's decision to reduce sugar and caffeine in its drinks could affect its relationship with retailers [2]

Retailers might be concerned that reducing sugar and caffeine levels could lead to lower consumer demand for Myt PLC's products. If sales decline due to changes in taste preferences, retailers may allocate less shelf space to Myt PLC's drinks or prioritize stocking competitors' products, potentially straining their business relationship.

Explain one reason why Myt PLC's diversification into the healthy snacks market could be considered a risky strategy [2]

Diversification into the healthy snacks market is risky because Myt PLC may lack expertise and brand recognition in this new sector. Competing against established brands with strong customer loyalty and distribution networks could make it difficult to gain market share, increasing the likelihood of financial losses.