Kyrsten Cregger

https://www.preparedfoods.com/articles/124412-the-coca-cola-company-announces-new-senior-appointments

When I think of companies that stand the test of time or companies that are universally known, Coca-Cola always comes to mind. The signature, red and white logo, emotional advertisements, and brown carbonated soft drink is easily one of the top 20 most recognized brands and products out there. It is no question that Coca-Cola’s marketing team has found a way to wind the brand into people’s hearts. I would even go as far as to say most people probably have a happy memory associated with the brand.

For example, I distinctly remember sitting in the theater for family movie nights, holding a candy box in my left hand and a Coke in my right, and watching the Coca-Cola advertisements with the adorable polar bears. I also remember always having the option between Coke and Sprite at all of my childhood friends’ birthday parties. Coca-Cola manages to be “the great equalizer” as it is enjoyed and shared by everyone in the world, regardless of demographics.

Pandemic Impact

With restaurants and entertainment venues limited or closed during the pandemic, individuals searched for new ways to find comfort in their own homes. One of the largest trends to arise was the COVID-19 snacking boom. This trend was largely fueled by younger generations, including Gen Z, Gen X, and Millennials. Whether to deal with “hanger”, cravings, or boredom, the world experienced a large uptick in snacking behaviors. Chip and soda brands, like Coca-Cola were left to benefit.

https://finance.yahoo.com/news/data-gen-z-millennials-admit-to-snacking-73-more-during-covid-19-pandemic-120022854.html?guccounter=1&guce_referrer=aHR0cHM6Ly9uZXdzLmdvb2dsZS5jb20v&guce_referrer_sig=AQAAAFI0OB0hZJiZSXMu3retMspmP7VxInodIeeFw0UYgzkSJbMw-UvSZknfMmlpFGTY2Dr-o-svgOSM2CqDBB6fd3MMpjiBCIuqKdHR3gCmRmlmetld4AfuSIoLsmYmC7ehrmOMZfRfSpWh7y8N-mqzUGPesGscpm3slao-0bu9fjcX

However, that isn’t to say that spending behaviors were higher than the pre-pandemic era. Businesses across the board saw declines in sales and consumption. Coca-Cola was impacted by drops in sales in partnership locations such as restaurants. Furthermore, they were impacted by a majority of consumers tightening their budgets to deal with the economic burden posed by COVID-19. In other words, Coca-Cola, like other snack and soda brands, had to navigate the pandemic world as cautiously as individuals.

The End Is In Sight

It’s been over a year since the pandemic shut down the world and we are finally beginning to see the light at the end of the tunnel. The pandemic coming to a slow close poses as a strategic uncertainty for every single company out there. Coca-Cola is asking a lot of questions as it attempts to plan out its next steps. Will the snacking boom will continue once we are back to a state of normalcy? Will restaurants will be able to afford partnerships with the soda giant? Will consumer health trends change as a result of the end of an era?

Coca-Cola’s Strategic Plan

Coca-Cola plans to take things slow as the world finds normalcy once again. In fact, it is taking a transnational approach and looking at each region separately. It is holding off on stronger marketing efforts in areas that are taking longer to open up and holding off on areas that are beginning or in the middle of their vaccination phases. However, Coca-Cola plans on ramping up marketing efforts in regions that show recovery from the pandemic. On the other hand, it also plans to revoke marketing efforts if the recoveries turn south.

Coca-Cola started this new marketing plan phase in areas of recovery in the Asia Pacific such as China. Thus far, its plan seems to be a success as revenues have surpassed those of the year before, which in turn is helping Coca-Cola to get ahead of this recovery phase for itself. In these regions, Coca-Cola rolled out new digital marketing tactics that proved to be innovative, efficient, and effective. With unique marketing plans catered to every region and their stage in the pandemic, Coca-Cola hopes to come out of COVID-19 ahead of the curve.

https://www.marketing-interactive.com/coca-cola-to-hold-marketing-spend-for-regions-slow-to-recover

The Threat of Suppliers

Unfortunately for Coca-Cola, consumer trends are not the only strategic uncertainty it has to worry about as we reach the end of the pandemic. Coca-Cola recently revealed that it will have to rise prices in order to combat the rising costs of commodities. Due to the aluminum tariff posed by Trump’s Administration in 2018, the cost to create Coca-Cola’s packaging has been slowly increasing over the years. Higher commodity costs compounded with lower revenue earnings from COVID-19 has pushed Coca-Cola to make the strategic decision to raise costs to help its profit margins. Who knew that suppliers could pose a huge threat to an industry giant like Coca-Cola?

https://www.cnbc.com/2021/04/19/coca-cola-will-raise-prices-to-offset-higher-commodity-costs.html

In fact, Coca-Cola is being pushed to change their marketing mix to deal with this threat from suppliers. During the pandemic, Coca-Cola focused on marketing its larger packaging options in order to meet the snacking boom and increased demand for in-home soda consumption. However, the company foresees itself pushing smaller packaging items once again now that the pandemic is coming to close. The smaller packaging options come with higher consumer prices per ounce. If Coca-Cola can successfully persuade consumers to purchase these options, they will in turn see higher margins to help combat the rising commodity prices.

The strategic uncertainty of ever-changing consumer trends compounded with the strategic uncertainty regarding rising commodity costs makes me wonder: will Coca-Cola’s strategic plan to push smaller sized options be successful? Will their new marketing strategies be sustainable? Will Coca-Cola come out on top of the pandemic recovery?

Personal Insights

Personally, I believe Coca-Cola will remain a sustainable brand mainly due to the global recognition. Coca-Cola has been around for over 130 years and will continue to be one of the top carbonated soft drink brands for years to come. However, I am not sure if its smaller packaging marketing efforts will work in its favor.

As Coca-Cola already acknowledged, consumers have been more frugal in their spending habits due to the economic burden from the pandemic. Even though the pandemic is coming to a close, it is not a safe bet to place that consumers will be less likely to save money. In fact, I would bet that consumers continue to be cost-efficient especially in their grocery expenditures. If consumers were willing to purchase the larger packaging options provided by Coca-Cola during the pandemic, I foresee them to be more willing to continue purchasing these options rather than paying more for smaller options. Moreover, if you look in any grocery store soda aisle, there are fare more regular or large-sized items than there are small or mini-sized items. This just goes to show that the larger options have been more popular since before the pandemic. Furthermore, increasing prices and pushing smaller options will not be favorable to those with lower incomes. In fact, customers who are already struggling to afford the current price of soda may be entirely unable to afford the increased prices.

Recommendations

If I were Coca-Cola, I would search for other ways to decrease costs rather than to push the cost on the end consumer. For such a high-profile global brand, increasing marketing efforts in areas that are starting to recover may be over-kill. In fact, Coca-Cola may find itself on top of the recovery by sticking to past marketing strategies. While it is proven beneficial to innovate marketing efforts to be more efficient and effective, Coca-Cola may be underestimating the power of word-of-mouth advertising and social media. Furthermore, considering regions are starting to find normalcy once again, Coca-Cola’s revenues from restaurant partnerships will start to rise back to pre-pandemic levels. If they were to save some money in terms of marketing initiatives, perhaps they would not have to push the commodity costs on the average consumer.

On the other hand, I also recommend that Coca-Cola forgo trying to push its smaller-sized options. If Coca-Cola is worried about losing its lower-income consumers, then increasing marketing efforts for the more expensive option would be ludicrous. Lower-income individuals generally are looking for the best bang for their buck, thus they tend to purchase in bulk where they see the largest savings. Furthermore, if the younger generations were driving the snacking boom, it is safe to say that this new-found target market is comprised of lower-income individuals already. If the younger generation, lower-income consumer drove the snacking boom, thus driving the success of snack and soda brands during the pandemic, it would be a dull way to repay them for their loyalty by increasing costs. Coca-Cola could find other ways to market its larger-sized options to appeal to all consumers, rather than hedging out its lower-income consumer entirely.

In conclusion, I believe Coca-Cola should switch its marketing strategy to one that favors those that drove the snacking boom. The snacking boom was fueled by younger generations with lower incomes and social media accounts. Coca-Cola could save money via social media advertising and in turn not have to increase prices or push its smaller products. However, Coca-Cola has made right and wrong marketing decisions in the past and still remains at the top of the industry. Regardless of what the firm decides to do, it is a safe bet that Coca-Cola will remain one of the most widely recognized companies in the world for years to come.

https://news.nike.com/news/nike-refurbished-circularity-model

The Shoe Industry’s Environmental Impact

Like most humans in the world, I am an athletic footwear consumer. Although I did not play traditional sports growing up, I always needed a pair of sneakers for gym class and outdoor activities. I even bought my hip-hop sneakers for dance classes from Reebok. It is safe to say that most people in the world are athletic footwear consumers, some more so than others. Yet, for a product that is so culturally diverse, not many people stop to think about the impact their favorite sneaker brands have on the environment. I know I never did.

A History of Carbon Emissions

According to Nike, the footwear and apparel industry is widely responsible for a large portion of global carbon emissions. In fact, at the time of the study, there were 50,000 million tons of carbon emissions globally and 2,100 million tons of carbon emissions were the product of the footwear and apparel industry alone. Part of Nike’s environmental pledge meant taking responsibility for their share of carbon emissions. Nike reported that 8 million tons of carbon emissions came from their supply chain via owned or operated facilities, operations, and materials (FY20 NIKE, Inc. Impact Report). It is crazy to think that a product that is meant to keep humans in shape is actually abetting the demise of the environment!

https://news.nike.com/news/our-carbon-footprint-and-our-next-steps

Nike’s Plan of Action

To achieve a sustainable advantage in the industry, Nike chose to forgo an environmentally sustainable overhaul. In other words, Nike saw an opportunity to lead environmental efforts in the footwear and apparel industry with their “Move to Zero” campaign. This campaign lists their quantifiable goals and objectives as follows:

1. All of Nike’s facilities will use 100% renewable energy resources by 2025.

2. Nike will decrease its carbon emissions by 30% globally by 2030.

3. Nike will find innovative technologies and ways to reuse 99% of all manufacturing wastes.

4. Nike will continue to reutilize over 1 billion recycled plastic bottles to create product materials.

5. Nike will launch programs such as Reuse-A-Shoe and Nike Grind that will facilitate the use of repurposed products.

https://news.nike.com/news/nike-move-to-zero-climate-change-initiative

Nike’s Environmental Programs

Nike Grind

Nike acknowledged the fact that they would have to make environmental moves in order to remain sustainable. Without a healthy environment, there could be no sports, and there could be no Nike. Nike Grind is program that combines Nike products and innovative technologies to reutilize excess waste to create new products. In fact, Nike rubber, foam, textiles, leather, and thermoplastics are used to design playgrounds, turf fields, tracks, courts, carpeting and more! Nike is partnered with leading sports equipment and facility designers. In essence, Nike is not only changing their own environmental impact, but helping the sports industry as a whole change their environmental impact.

https://www.nikegrind.com/materials/

Nike Refurbished

The newest program released by Nike early in April of 2021 is Nike Refurbished. This program entails taking used Nike shoes, refurbishing them like new, and reselling them at discounted offers in select stores. In fact, there are 3 types of shoes that will be offered with this initiative: lightly used, gently worn, and defective pairs. The box itself includes details on the type of shoe, its condition, and a QR code that directs consumers to their “Move to Zero” initiative. Nike Refurbished is perfect for consumers that are interested in consignment shopping, thrifting, or looking for a good deal.

https://www.nike.com/sustainability/nike-refurbished

Implications

While the world still produces more than acceptable amounts of carbon emissions and Nike has a long ways to go to meet their goals, Nike’s “Move to Zero” initiative and its programs have been a welcome start for the footwear and apparel industry. Nike has long been a leader in the footwear industry; therefore, the Nike Grind and Nike Refurbished programs will not go unnoticed by its competitors. It may be harder for established footwear and apparel brands to completely redesign their productions and expand programs to be more environmentally friendly. However, there are plenty of newer brands cropping up that are starting out their business on a better environmental foot. For example, companies like Allbirds, Everlane, and Rothys introduced their brands to the world as footwear that is ethically made in a better way than before.

This leads me to wonder, will Nike be able to maintain a sustainable competitive advantage? Will Nike’s competitors join the bandwagon and perform environmentally better than Nike?

The Future of Nike’s Sustainable Competitive Advantage

Nike was one of the first athletic footwear brands to take a stance on climate change. Since the introduction of their “Move to Zero” initiative in 2019, Nike has kept their word and rolled out multiple programs to become more environmentally sustainable. While other brands are following suit, I believe Nike will be able to maintain a sustainable competitive advantage in the long run.

Consumer Awareness

First and foremost, Nike is incredibly aware of its consumers. Nike’s target market includes active people that are environmentally and socially conscious. There is a consumer trend to be more active, live a healthier lifestyle, and to be more environmentally friendly yourself. Consumer behaviors that lend to these trends include shopping solely from businesses that prove they are environmentally and ethically sustainable. Other consumer trends include purchasing resale items at consignments shops or thrift stores in order to decrease waste. Nike’s “Move to Zero” initiative, Nike Grind, and Nike Refurbished fit seamlessly with the consumer trends and behaviors of their target market.

Target Market

Finally, Nike’s consumer awareness lends perfectly with the scale and loyalty of their target market. Nike is one of the largest footwear companies in the world, proven by the fact that everyone is able to recognize their iconic swoosh. With their scale and massive target market, Nike has already been able to generate enough revenues to be able to fund environmental programs such as these. Companies that do not perform as well as Nike may find it more difficult to be able to fund other ethical and environmental practices. Furthermore, Nike’s target market is invariably loyal. When it comes to finding the perfect pair of sneakers, many people choose to stick with their favorite and trusted brands. Nike will have no trouble reaching their loyal customers; however, with these environmental initiatives, Nike will stand better with old and new environmentally conscious consumers.

https://news.nike.com/

The Verdict

With Nike’s large target market and profound consumer awareness, Nike is very likely to maintain their sustainable competitive advantage. To keep this advantage, Nike must continue to expand upon their environmental efforts. This includes pouring resources into the research and analysis of their current programs, as well as funneling resources into starting new programs as well. Furthermore, Nike must continue to adapt to the ever-changing consumer market. Nike cannot afford to miss a beat as the competition in the industry is fierce. Therefore, Nike will have to update celebrity endorsements to remain relevant, roll out new designs to match trends, and stay on top of public relations to make sure they keep a positive light in the consume eye.

A Mutually Beneficial Relationship

Every kid’s favorite time of the year is summer. No school, perfect weather, life is great. I distinctly remember running errands with my family on the weekends. These included early morning breakfasts at Einstein Bros., a visit to Blockbuster’s to prepare for family movie nights, labored trips to Walmart to pick up groceries and supplies for the week, and a pit-stop at McDonald’s for a snack IF we behaved.

McDonald’s and my parents were in a mutually beneficial relationship. My parents supplied McDonald’s with their cash and McDonald’s supplied my parents with an incentive to keep my brothers to behave. In fact, my eldest brother frequently chose to disobey my parents’ wishes unless they would get him chicken nuggets in return. I would like to think I was the behaved, favorite child; however, I too enjoyed trips to McDonald’s for a Happy Meal.

McDonald’s and Walmart were in a mutually beneficial relationship as well, however different from my parents’. Walmart supplied McDonald’s with a steady line of customers and McDonald’s supplied Walmart with rent and an incentive for shoppers to stay longer and rethink purchases. As timeless as this partnership may have seemed, all good things must come to an end.

The Pandemic Hits Hard

McDonald’s recently announced it would be closing many of its Walmart locations. When the partnership was strong, there were about 1,000 McDonald’s in Walmart stores. By the end of this summer, only 150 will remain open. Due to the pandemic, consumer trends shifted from indoor dining and indoor shopping to takeout, home-cooked meals, and ecommerce. Walmart was ahead of the curve with advanced curbside and delivery options, allowing more customers to stay at home or stay in their cars. State rules that banned indoor eating had many restaurants out of business. While McDonald’s is clearly ahead of the game in takeout services, those located in Walmart stores were worse off for a variety of reasons.

We Should Have Seen it Coming

While McDonald’s seems to be a business that will stand the test of time, it is no wonder that the Walmart locations are their weak links. McDonald’s is known for being fast and convenient. However, it is no longer fast nor convenient to walk into a Walmart for fast food when you can go through a drive-thru at a nearby location. Furthermore, these in-store locations never seem to get the face-lift that the other locations receive. Each new McDonald’s gets more modern and tech central as they are built. Even Walmart remodels their existing stores instead of building new ones. Yet, their shared locations seem to get left in the dust.

https://animesuperhero.com/forums/threads/remember-when-walmart-stores-had-mcdonalds-in-them.5719371/

It leaves me wondering, would the McDonald’s located in Walmart stores preform better if they were updated? Is there a way to save or restore this mutually beneficial relationship?

Strategic Recommendations

Walmart stores have lost a great deal of revenue they once brought in from renting out these retail spaces. They continue to create partnerships with other food chains to fill out the empty spots; however, I believe there is still potential for McDonald’s.

I recommend that the McDonald’s in Walmart stores redesign their specific business models. They could utilize their retail space mainly for kitchen purposes. This entails having just enough space and employees to cook and box meals for consumers. The rest of the retail space could be revamped and modernized. Perhaps consumers could go up to a touchscreen kiosk to enter and pay for their orders. Their orders would then be handed to them by an employee or a contraption between the kitchen and customer area would open and reveal their takeout food. Without the employee-to-guest interaction, a tremendous amount of time could be saved. These locations may never perform as well as a store with a drive-thru; however, a new modern design could attract more Walmart shoppers that are on-the-go.

We always advocate for adopting in pairs to help rescued cats transition into their own homes; however, we sometimes wonder if it is advisable to bring a new cat into the home of a cat who is already set in their own ways. There have been horror stories of unacquainted cats not getting along with each other in any way at all, but there have also been happy endings where two cats naturally gravitate towards each other. Even if the first encounter between a new cat and your home cat does not go over well, there is  no reason to give up. There are a few steps and precautions to take that will help cats to learn to cohabitate peacefully, if not, better.

When it comes to adopting a second (or third) cat, it is first advisable to consider whether or not the cat’s personality would mesh well with the cat you already have. If your current cat is very dominant, perhaps look for a cat who seems more relaxed and easy going. If your current cat is more relaxed and easy going, perhaps match that cat’s personality. If your current cat is very lazy, it could be beneficial to look for an energetic, playful cat to bring out the kittens in each other. On the other hand, it would be less advisable to bring a new dominant cat into a home with an already dominant cat which could cause territorial problems. You know your cat better than anyone, so give it plenty of thought about what personality would compliment your home.

Once you find the right cat for your home, there are a few tactics and steps to take before letting both cats roam freely around the house. First of all, set up a room in the house where the new cat can be “quarantined”. This room should include a cat bed, kitty litter, plenty of food and water, a scratching post, blankets with your family’s scent, a blanket with your resident cat’s scent, and cat toys. The new cat should have everything they could need, but also fabric in the room that will get them accustomed to the scents of the people and other pets in the home. Associating a safe room with the scents of people in the house will help the cat to associate safety with the people and pets as well. 

After you set up the room, you are ready to bring the new cat home. As soon as the cat arrives, immediately bring him/her to the new room in the cat carrier with as little contact or sight of the resident cat as possible. It is common for cats to fight or act aggressively during the first encounter, so you want to push off the first actual encounter until they get used to being in the same vicinity as each other. Having the cats separated by a door will allow them to see and hear each other, but not touch each other. It is also important to feed both cats near the door on their respective sides. This will associate being near each other with a pleasant experience, such as food or special treats. Furthermore, make sure to spend plenty of time with both cats independently.

People are not joking when they say “cats are like potato chips; you can’t have just one!”. Technically speaking, it is quite possible to only adopt and have one cat at a time; but, why would you when it is better to adopt two cats at the same time? At Le Cat Cafe, we are strong proponents of adopting two cats over one because it proves to be very beneficial for all involved: the cats, the adopters, the shelter, and the community as a whole. 

Many think that cats are independent creatures that prefer solitude over attention or company (Um, 2020). However, cats are social creatures themselves that appreciate company and can learn a great deal from having other cats around. In fact, cats learn social skills off of each other, such as what behavior is or is not acceptable. Having a feline friend around can also help them feel less bored and lonely (when they are actually awake). More importantly, the adoption process can be stressful for a cat. It is difficult being moved from place to place, living out on the streets, and being thrown into domestic life. In this case, adopting two cats from the same shelter at the same time can ensure that they acclimate to their new surroundings with a familiar face. 

These two cats may end up being more than just familiar faces to one another. For instance, when cats are temporarily housed in shelters, many will develop bonds and connections with the other cats (Haraldson, 2016). If you come upon a bonded pair at a shelter, take advantage of the connection between the cats and keep them together. Just like it is hard for us to be separated from people we care about, it is just as difficult for cats to be separated from each other. Even at Le Cat Cafe, we notice strong relationships between multiple cats in the cafe at a given time. It is so heartwarming to see two close cats given the opportunity to share a loving home and a life together.

From another point of view, adopting two cats at the same time can be a blessing for adopters. Sure, cats are seen as the low-maintenance pet. However, they can prove to be a handful when you least expect it. Horror stories have been shared about kittens getting into places they should not be and destroying furniture and other belongings. Many times, these antics are the product of having a bored cat (Lapierre, 2020). Adopting two at the same time is not just a second bundle of cuteness, but also a destruction preventer. Furthermore, if you ever choose to adopt again down the road, having two cats will ensure that they already have the skills to share territory. “Single” cats can be very temperamental and not take to a new animal nicely. Paired cats, however, are used to sharing their humans and space with others, making the transition much easier. 

Moreover, when you adopt two cats from a shelter, it is as if you are saving four cats’ lives. You are not only rescuing the two you take into your home, but also rescuing the two cats that will take the newly empty spots in the shelter (Lapierre, 2020). For this reason, many shelters and adoption platforms, like Le Cat Cafe, will offer a discount on the second cat if you adopt two instead of one. In turn, this helps relieve the animal overpopulation problem that many cities in the United States are experiencing. Kill-shelters still exist; however, they could become no-kill shelters if people adopt more and make sure they are fixed and off the streets. Adopting two cats at once doubles your part in helping the problem.

It is selfless and noble enough when you choose to adopt a cat from a shelter; however, it is even more so when you adopt two. If you are thinking about adopting, consider whether or not you can afford to take care of two cats. Consider whether or not the cat you choose seems to have a bond or connection with another cat at the shelter. Consider whether or not you have room in your heart for two lovable cats, instead of just one.

Competitive Advantage

Netflix, the leading provider of Streaming Videos on Demand, has an uncertain future ahead; however, it can secure its future with sustainable competitive advantage. According to the case, Netflix’s competitive advantage comes from being one of the first platforms in the industry and being a well-known brand. Sure there are other platforms and more platforms joining the competition; however, Netflix has multiple years of subscribers, content, data, and finances that will help it maintain its lead for some time. With being one of the first platforms, Netflix was able to secure a high reputation in the industry and able to monkey with their content in order to provide subscribers with what they want to view. The data and capital raised during its lead in the industry will also remain a competitive advantage; however, this is not as sustainable. As the data shows, other platforms are sweeping the competition, stealing subscriptions, and even taking content away from Netflix. Therefore, Netflix’s most sustainable competitive advantage lies in its original content creation. With the plethora of revenue generated during its first few years, Netflix began reinvesting into original content creation, funding movies and shows that are original and solely on its own streaming platform. Furthermore, the cost of creating their own content is one-time, consistent amount; therefore, they will pay for themselves as enough subscribers watch them and purchase subscriptions to watch them. Netflix is also able to use its consumer data in order to make better-informed decisions in what type of content to create and what shows/movies to continue funding. If Netflix is able to hone on to the wants of their consumers, they will be able to maintain a sustainable competitive advantage by creating content that users must subscribe to in order to view in the first place.

Sustainability

According to the article “Does Netflix Have a Competitive Advantage?” by Jeremy Bowman, in the past year, Netflix has proven that it does in fact have sustainable competitive advantage. Bowman states that Netflix’s sustainable competitive advantage boils down to 2 characteristics: pricing power and increasing profitability. For example, Netflix chose to raise its subscription from $13 to $14 in the 4th quarter of 2020. Although Netflix is almost double the cost of many competitors (Disney+ for $6.99, Apple TV+ for $4.99, etc.), Netflix is able to charge the higher cost without fear of losing too many subscriptions. Bowman claims that Netflix’s pricing power is the product of an aggressive content spending strategy in order to create and offer something for everyone. The other platforms have not dabbled in original content creation nearly as much as Netflix. If they were to start dabbling in content creation, we could expect the prices of those subscriptions to rise as well in order to be able to fund original shows and movies that are geared to the consumers’ wants. On the increasing profitability side, Netflix finally told investors that they expect to see a break-even point and positive free cash flow sometime in 2021. Free cash flow was a huge challenge for Netflix for many years, as they prioritized original content creation in order to rake in higher subscription volumes. It seems as though their aggressive content spending strategy may soon pay off and even lead to an economic “moat” between Netflix and its competitors. This “moat” will be the core of their sustainable competitive advantage as they are financially able and sound enough to continue content generation in focus of gaining and retaining subscribers.

Bowman’s article directly supports my thoughts on Netflix’s sustainable competitive advantage. For one, Netflix’s beginning stance in the industry allowed them to start and increase their subscription volume which led to a financial competitive advantage. Although I speculated their well-known presence in the industry to be the main advantage, Bowman contributes their early presence in combination with their early content strategy to be the true competitive advantage. For instance, Netflix was quick the game to collect subscribers as well quick to offer original content that retained subscribers. I am more speculative about their financial advantage considering Netflix has always found free cash flow to be a challenge. Furthermore, their recent financial earnings can be closely attributed to consumer trends in relation to COVID-19. There is no evidence that trends will remain the same after COVID-19 is a thing of the past.

Competitive Environment

Netflix’s competitive environment has grown significantly in the last couple years. At the beginning, Netflix’s main competitors were Amazon Prime and Hulu. More recent additions to the streaming industry include Apple TV+, Disney+, HBO Max, CBS All Access, Peacock, ESPN+, Quibi, and Paramount+. The market is saturated by enough competition that the threat of a monopoly is not in the picture. However, all competitors can be seen as substitutes to Netflix, and there is an ever-present threat of entrants that want to play the same streaming game. According to the case though, many subscribers are willing to pay for multiple streaming services. Netflix happens to be one of the contenders that most subscribers are willing to hold on to.  As far as suppliers go, Netflix is making a strong decision to rely heavily on original content creation as other competitors began to “steal” access to pre-existing content. Original content creation has 1 flat cost, which can be covered by continued and new subscriptions. On the buyer side of things, Netflix attempts to provide content for all. Therefore, they are attempting to market towards families with young kids, adults that work from home, and teens. Other companies, such as Disney+, are focusing their marketing efforts on target markets like just families with young kids. Netflix and its competitors seem to be focusing on adding and creating content that will positively reach their specific target markets; however, its competitors seem to be using a lower-cost initiative to try and steal some market share.

Threats

The biggest threats to Netflix include Amazon Prime, Disney+, and HBO Max. For one, Amazon Prime has no lack of subscriptions and no lack in popularity. Amazon Prime’s challenges have been trying to market their streaming services and procuring/creating content that is wanted by their consumers. In other words, Amazon Prime is finding it a challenge to compete with Netflix’s content; however, Amazon Prime has the funds and resources to collect and analyze data that could potentially eliminate this problem entirely. As for Disney+, they are a big threat to Netflix because they have already secured the rights to their own content, Pixar’s, Marvels, and Discovery’s, as well as started to create new original content. They even started releasing content so people can see it at home compared to the theaters. They also offer their streaming services at a much lower price. HBO Max on the other hand, offers their product at a higher price; however, they have the rights to more “blockbuster” movies and will start creating more “blockbuster” content with bigger celebrity names involved. If any streaming service is able to perfect their content creation, offer enough variety, and at a lower price, any streaming service stands as a threat to Netflix.

Consumer Trends

In the streaming services industry, there are multiple emerging consumer and industry trends that are super important to track. One consumer trend is “couch time”, or the increasing desire to stream shows and services during and due to the pandemic. In fact, 56% of respondents said they are watch 2 or more hours of streaming services on a given day than before the pandemic (euromonitor international). Some parents even use streaming services as a make-shift nanny to watch over their kids, while other adults now working from home feel the need to have a relaxation break in the middle of the work day to relieve the stress. Another consumer trend is the desire for a lot of variety and multiple options to stream. That being said, Americans are spending more and more on streaming services in a month and most subscribe to multiple streaming services.  For example, families with children have 3.8 services while homes with no children subscribe to 1.7 services (Flint, Mullin, & Rizzo, 2020). Consumers are spending more time viewing streaming services, have more time to get through all of the content, and therefore look to more providers to keep up this trend.

On the industry side of things, streaming service providers must compete for consumer attention. One industry trend is creating original content for their viewers rather than getting caught in a bidding war trying to secure other content. Considering the pandemic shut down a lot of studios and production, there has been less content to procure and consumers are consuming at record level speeds. Netflix has been a leader in original content creation; however, other providers like HBO Max, Amazon Prime, Disney+, and Hulu are later to the game, but starting to see the importance of it more and more. Another industry trend is the seek for opportunity in the international sector. While most of these streaming platforms are native to America, international markets are now being viewed as untapped streams of revenue. Netflix has seen incredible growth in subscribers, so it is not long until the other platforms expand their market internationally as well. The challenge then becomes offering content and services that are perceived just as well on an international stage.

Global Consumer Trends of 2021

Consumer trends are key for a firm’s success because they can either make or break the business. On a positive side, Netflix will be impacted by the consumer trends craving convenience, phygital reality, playing with time, and shaken and stirred (euromonitor international). Netflix is able to cater to craving convenience very easily. Netflix is an online streaming service that offers entertainment in the most convenient way possible. Furthermore, Netflix’s platform is built upon the idea of phygital reality. People once were able to go to movie theaters to consume entertainment. Now the same experience can be consumed directly from their streaming devices at home. Moreover, Netflix is up and running 24/7; therefore, they are able to cater to the consumer’s desire to consume entertainment at any time that is convenient for them. Some newer consumer trends can also affect where Netflix takes its next step. For instance, they can cater to the shaken and stirred trend by creating content that is built to foster a balanced, fulfilled, and self-improved well-being. In fact, it may be beneficial for Netflix to spend more resources in this particular area. On the negative side of things, it is just as important for Netflix to be aware of the trends that could negatively impact them. For example, Netflix should be weary of the Outdoor Oasis trend and how movie theaters could take this to their advantage. If movie theaters were able to provide an outdoor experience at cheaper costs, consumers may be more willing and interested in consuming their entertainment in a new, outdoor experience. Therefore, Netflix should make the effort to secure their position as a leading entertainment provider for the long-run.

Sustainable Competitive Advantage

Amazon has been building sustainable competitive advantage in a variety of different ways. For instance, Amazon has company assets/abilities that allow it to outperform its competitors. According to the case data, Amazon is getting into the real estate game, making sure there are many warehouses for distribution and packaging purposes, as well as brick-and-mortar fulfillment centers. Furthermore, Amazon is focused on eliminating pain points for customers which is seen in their easy-to-navigate website and Amazon Prime delivery options. Amazon even tries to diversify itself and its offerings by making products of all categories available to the market and branching out into their own new products to compete. That being said, Amazon’s main sustainable competitive advantage is their ability to give the consumer what they want – variety and convenience.

2021 Consumer Trends

One consumer trend followed by Amazon shoppers is “Craving Convenience”. Amazon shoppers enjoy the convenience of a digital platform, what the Prime membership and grocery memberships have to offer, and the fast delivery options available. Especially with post-pandemic measures, in-store shopping became more inconvenient, if not impossible; however, Amazon remained a viable option for previous shoppers and became a viable option for new Amazon shoppers. The second consumer trend followed by Amazon shoppers is “Phygital Reality”. Amazon Shoppers seem to follow the trend of linking physical and digital worlds. For instance, Amazon offers Prime subscription (video & music), Alexa, grocery memberships, and more that provide out-of-the-house experiences inside the home. With pandemic measures in place, Amazon shoppers are looking for ways to consume their movies, music/concerts, information technology, shopping, and grocery shopping all from within their home. Amazon offers internet-connected services and products that enable the shopper to stay at home to complete their daily routines. Finally, the third consumer trend followed by Amazon shoppers is “Playing with Time”. For instance, Amazon offers 1-2 Day free delivery for Prime subscribers, which enables the shopper to receive products faster than ever. Furthermore, these same subscriptions allow the consumption of entertainment (movies, music, books, etc.) virtually at whatever time fits their needs. Amazon shoppers crave convenience, a digital presence that mimics reality, and immediate consumption ability.

Amazon Prime: Threats & Opportunities

One threat to the Amazon Prime subscription service is another competitor launching a service that rivals their own. According to the case, Walmart is Amazon’s top competitor and has already launched services very similar to Amazon’s including an easy-to-use website and fast delivery options. If Walmart+ begins to rival Amazon Prime, it could very well steal some market share. Another threat to the Amazon Prime subscription is popular opinion and reputability. There has already been scrutiny over the conditions of Amazon warehouse environments and about the greed of the owner. If Amazon does not take consumer opinion seriously, it could lose loyalty and subscription volume. An opportunity for the Amazon Prime subscription is to become the forefront of entertainment services including streaming and music. Streaming services are dominated by other companies such as Netflix and HBO, while music services are dominated by Spotify and Apple music. If Amazon Prime were to focus their efforts on the entertainment services provided, they may be able to steal from the current market. Finally, the last opportunity for the Amazon Prime subscription service is the in-store retail experience. Amazon Prime has become the giant of ecommerce and seems to have hit many of the opportunities in that world; however, they have not expanded much into the brick-and-mortar platform. Having retail space for Amazon Prime would expand the experience to consumers that need faster than 1-Day delivery or just prefer an in-person experience.

Strategic Recommendations

Whenever I am asked, "what do you want to be when you grow up?", I have been responding with the same answer for 8 years. I want to own my own cat cafe. Yet, this prompts another question: what even is a cat cafe? A cat cafe is coffee shop-like atmosphere that doubles as a cat adoption agency. There are not many in the country, but I have been lucky enough to visit a few and even intern for one in Philadelphia, Pennsylvania.

Along my journey, I have managed the social media of a non-profit cat cafe, which has proven to be quite a challenge. In order to understand the art of cat cafe social media, I have chosen to analyze a popular non-profit cat cafe in New York, Brooklyn Cat Cafe.

Brooklyn Cat Cafe

The Brooklyn Cat Cafe, established in 2016, is New York City's only non-profit cat cafe. They consider themselves a "cat adoption center and social space" that is paired with a local animal rescue, Brooklyn Bridge Animal Welfare Coalition. They pride themselves in bringing rescued cats to possible adopters of all ages, while teaching them the importance of pet rescue (Brooklyn Cat Cafe, 2020).

Social Media Overview

To start the analysis on Brooklyn Cat Cafe, it is important to have an industry category to use as a benchmark: US - Retail - Restaurants - Coffee Shops and data collected from Shareablee. Although the Brooklyn Cat Cafe is not a coffee shop in its most basic form, they do consider themselves a cafe that offers drinks and beverages in a similar atmosphere.

The Brooklyn Cat Cafe manages pages on Facebook, Twitter, and Instagram, the 3 main platforms for businesses. Instagram is their top account, with almost 22,000 followers. Their Facebook account follows with 5,830 global fans (3,015 fans in the United States), while their Twitter account has just over 2,000 followers. Considering their top product is adoptable cats, it is no surprise that they would dominate the picture sharing social scene.

Looking at the overview of their social media, there are a few metrics to note. First, Brooklyn Cat Cafe has an audience of 29,904 while the industry average is 75,959. The difference boils down to 2 main reasons: the company is very niche and not a chain. Yet, even with a smaller audience they manage a higher engagement. For instance, the cat cafe has a 1.819% engagement rate while the industry average is only 0.347%. Along the same lines, the cat cafe has more content (513 vs. 174) and more total actions (262,924 vs. 46,082). In other words, the Brooklyn Cat Cafe may have a smaller audience, but they surely know how to engage that audience.

When comparing Brooklyn Cat Cafe's social media initiatives to the industry average, there are 3 main metrics to note: actions, content, and frequency per week. For instance, the cat cafe has more actions on their Facebook and Twitter and a fairly comparable amount of actions on their Instagram as compared to the industry. As far as content goes, Brooklyn Cat Cafe puts in an even amount of effort into all 3 of their platforms. The industry generally has more content on their Facebook and Instagram, but way less content on Twitter. More impressively, Brooklyn Cat Cafe posts 2 times as often on Facebook and Instagram and 3 times as often on Twitter than the industry average. The main takeaways from the comparative data are that the industry exerts more social media effort into Facebook and Instagram, but does not post nearly as often as Brooklyn Cat Cafe.

Instagram

Starting with their most popular social media platform, Instagram, we will dive deeper into Brooklyn Cat Cafe's social efforts. Since this is their most popular platform, it is fair to suggest that their efforts on Instagram are quite effective. A couple metrics such as 1,291 actions per post and 6.39% average media engagement (compared to 1.17% category average) reveal just how effective their Instagram efforts truly are. They reach these impressive numbers via hash-tagged posts that utilize images, videos, and carousels. Splitting these posts up, we note that the cat cafe obtains most of their engagement via images (42% engagement) and videos (41% engagement) with carousels only reaching 17% engagement. Considering carousels are fairly new to the Instagram platform, it makes sense that the cat cafe would slowly begin utilizing the new tool and seeing results from it.

When taking a quick glance into their Instagram, the page is overwhelmingly consumed by simple, yet professional photos of cats and kittens. Each post is accompanied by approximately 1 sentence and a whole bunch of hash-tags. Most, if not all, of the posts use cute or sad pictures with similar language in order to tug at the heart strings of their followers. The only call-to-action evident in their Instagram posts is the occasional "anyone want to join us?" in attempts to drive traffic to the cafe. This simple and consistent brand image reveals why Brooklyn Cat Cafe's Instagram is so effective and popular.

Facebook

Brooklyn Cat Cafe's Facebook is also well-groomed for that of a cat cafe. In a general overview, their Facebook page reaches a unique engaged audience of 19,080, has a 2.88% average engagement (compared to 0.20% industry average), and has a page score of 82 (industry high: 81, average: 63, and low: 26). Clearly, the cafe is doing something right when it comes to Facebook. Digging a little deeper, we note that the cat cafe posts mainly photos on their Facebook, with some videos, and the occasional link here and there. The page score for Facebook (82), is the most evident measure for comparing the cafe's social media to that of the average. For instance, the Brooklyn Cat Cafe stacks up at the very top for how well the company is able to create posts that are relevant and desired by their followers. Using complex algorithms, Facebook acknowledges that the Brooklyn Cat Cafe is very successful in creating content that satisfies its followers.

Looking into their Facebook page, it is interesting to note that the posts are very similar to that of the posts on their Instagram. The most probable explanation for the repetitiveness is a social media manager platform, like Hootsuite, that allows the social media manager to create cross-platform posts. Therefore, their Facebook is once again dominated by professional photos and videos of adorable cats and kittens. The posts also incorporate a short sentence or message, with the occasional link calling the audience to action. The main difference is the lack of hash tags.

Twitter 

Compared to the industry average, it is obvious that the Brooklyn Cat Cafe puts more effort into their Twitter account than other coffee shops. The main metrics that reveal their Twitter's success include 47 actions per tweet and a 2.204% average engagement rate compared to a 0.082% industry average. However, the performance of their Twitter really ends there. Once again, their Twitter looks like a spitting image of their Instagram and Facebook combined. They share a bunch of cute photos and videos of their cats and kittens. The main difference from the other platforms is that the cat cafe retweets posts from adopters or collaborators that are relevant to their page and mission.

Social Media Analysis

In conclusion, the Brooklyn Cat Cafe effectively manages their social media pages on Instagram, Facebook, and Twitter. With high numbers of followers, higher than average engagement rates, and frequent posting equipped with photos and videos that appeal to the emotions, the Brooklyn Cat Cafe successfully engages with its audience. Their consistency in frequency and post types also pushes the cat cafe above the industry.

Recommendations

There are a few aspects in which the Brooklyn Cat Cafe can take a few pointers and tips. For instance, the industry does not put nearly as much effort into their Twitter accounts and an even higher amount of effort into their Instagram. The Brooklyn Cat Cafe ought to inventory the relevance of their platform's respective audiences to see where they should attempt to focus their efforts. For instance, they have the highest amount of followers on their Instagram, yet they post the same amount on their other platforms. The Brooklyn Cat Cafe could attempt to post more and increase the variety of their posts on Instagram in order to tap into other audiences on the platform.

Furthermore, after analyzing each of their pages, it was evident that their accounts seem too monotonous. If they continuously post the same content on each of their platforms, it is as if they are only trying to reach the same basket of people, or target audience on each platform. This mentality does not take into account that the umbrella audience of each platform (regardless of the page followed) is very different than the other platforms. Therefore, the Brooklyn Cat Cafe should vary their content for each of their platforms. This strategy will allow them to reach new and larger audiences, while allowing them to be more selective when they attempt "call-to-action posts".

Finally, the Brooklyn Cat Cafe is very consistent with their brand, but they stick within their own brand a little too much. Social Media marketing allows companies to partner with other brands to reach larger audiences in a cost-efficient manner. If the Brooklyn Cat Cafe were to reach out to influencers, other cat cafes, and other businesses in the New York area, they may be able to reach untapped audiences that have similar interests for such a niche company.