Coca-Cola – The world's biggest brand wants to connect with consumers on daily basis ( The strategic thought )


As custodian of the planet’s most valuable brand, Coca-Cola, JOSEPH V TRIPODI perhaps has the most important marketing job in the world. Naturally, what he says is gospel for brand managers across the world. No wonder the 53-year old chief marketing & commercial officer of Atlanta-headquartered The Coca-Cola Company ponders over each question and chooses his words carefully, acutely sensitive to the responsibility that sits on his broad shoulders as the virtual ‘Oracle’ for the global marketing tribe.

This is your first visit to India. What brings you here?

Well, part of it is the India growth story. Part of it is, I’ve been here (with Coca-Cola) for two years, (and) I need to get into markets (that will) define a lot about (our) future. So this year, I spent a lot of time in China (particularly last year because of the Olympics). Then this year as well I have spent time in Russia, Brazil, and now India. It’s exciting because the opportunity is incredible here.

You joined Coca-Cola in the middle of a slowdown (mid-2007). How’s brand Coke come out of it?

We’ve come out stronger in strong markets. You can’t paint all markets with the same brush. We have been spending a lot of time understanding what people want. As for changes, Coke tends to be a 30-second-centric television commercial culture. But the big idea should sit at the centre of the table, not in the television spot. We are trying to say let’s look at the big idea for the brand, and connecting with consumers. We are moving a lot more to consumer engagement as opposed to simply television advertising. The pace of that change will be different for different markets.  If we want people to drink our brand on a daily basis, we need to connect with them on a daily basis. So, we are trying to understand the difference between consumers and shoppers, and how to engage shoppers in stores––that’s a very big focus for us (now).

You were an outsider at Coke. Your last job was in insurance. How’s the transition been?
I was in beverages––head of marketing for Seagram––so there have been parallels. Here we have people in the system who very much understand the soft drink business and have spent their entire careers here. We are putting in place a system where we can facilitate more aggressive growth for the enterprise. In a system like Coke, enhanced collaboration within the system can be the turbo changer of the business. In Coca-Cola, the last thing we would want is everybody operating on their own silos. Connectivity of different people around the world is basically what allows us to sharpen the overall learning and move faster than competitors. So, a large part of what we are doing is installing infrastructure to be able to do that. One of the things we are evolving is more focus on digital, and understanding better customer relationship marketing. We’ve got probably 95 million consumers in our database worldwide. We have a very heavy focus on one-to-one marketing. We are moving to precision marketing and moving away from what I call ‘spray and pray’ marketing. That means spray the message down and pray someone gets the message. Precision marketing is aligning the message with the media. It’s about engaging the consumer and at the right geographies at the right time. If you can do that, you can get a much higher return on marketing investment.

Emerging markets represent 15% of Coca-Cola’s sales volume and 25% of the company’s growth over the past three years. Sales in India are growing over a third annually though on a small base. Does that put a huge burden of expectations on India?

Quite honestly, we would expect strong growth in India like we expect strong growth in China and Brazil. We certainly think India represents big opportunity for us. We are in different stages in different countries. India did a great job of the ‘Little Drops of Joy’ communication. The spirit of the campaign has been rolled out in many markets. The execution may be different but the core idea is the same.

You recently said that the changing nature of consumer engagement, the digital march, will make Coca-Cola marketing evolve into content management. Is big brand marketing morphing into being the media itself?

Well, we are talking about how we can evolve as a global marketing entity with more content management, some of which will be consumer generated, some we’ll buy and some we’ll create ourselves. Whether you like it or not, consumers are in a way playing a big role in content management. At the end of the day, the consumer owns the brand more than we do.  Our Facebook page is the largest page in the world after Obama’s page. India, like many other markets, is a visual media market––outdoors, in-shop branding are all essential forms of branding (here). We (also) need to understand that digital marketing does not necessarily mean (only) the internet, but mobile too.

As for spending on digital marketing, we’d like to be little ahead of the curve but not so ahead. For some consumers, it’s best talking to them from the shelf. Others would like to be talked to in an outdoor environment. But the environment is going to change. If today, for example, digital spends are 8% (of our total ad spends), it’s going to be 8%-plus tomorrow.

How challenging is to balance the portfolio of global brands—Coca-Cola, Fanta and Sprite—with strong local ones like Thums Up, Maaza and Limca?

There’s nothing wrong with Thums Up leading Coke (in India). I don’t have any preference. It’s what the Indian consumer wants. If Coke equals Thums Up, great. If Thums Up remains the biggest brand, that’s great also. I mean as long as we’re leading in the cola market, we are fine. As for balancing global and local strategy, well, what we are trying to do at the global level is work very closely with our marketing folks. There are groups of people in the world you can communicate with in a similar way. We see a global youth culture developing. People who live in urban environments show a lot of commonality in their lifestyles. Happiness, optimism is something that’s shared by people all around the world. Yet, unless you don’t have a local component you’re not going to maximise the opportunity. That’s a fine balance.

How do you think putting calorie counts on front label packs will impact consumers?

Well, we are not hiding anything, we have nothing to be ashamed of. We have a variety of products and our portfolio is healthy and for people who lead a balanced life. Globally, regular Coke is doing very well this year as well as the diet (version). We have a wide variety of full calorie or less calorie drinks. Our role is to let the consumer decide based on their lifestyles. In reality, our long-term goal in this category is long-term consumption.

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