The coca cola company

The Coca-Cola Company

• Founder: Dr. John Stith Pemberton.
• Distinction: Made soft drinks a global obsession.
• Primary products: Coca-Cola Classic, Diet Coke, Sprite, Minute Maid.
• Annual sales: $19.805 billion.
• Number of employees: 37,400.
• Major competitors: Cadbury Schweppes, PepsiCo, Quaker Oats.
• Chairman and CEO: Douglas N. Daft
• Headquarters: Atlanta, Ga.
• Year founded: 1886.
• Web site: www.cocacola.com.

It’s odd to think of a company like Coca-Cola as being in need of an overhaul. Its products, after all, are sold in every corner of the globe and have dominated the soft-drink industry for more than a century. But even companies that change the world can take missteps and stumble, and Coke is no exception. Forget all the mesmerizing slogans and heartwarming ads; the distinctively shaped bottles and nostalgic memorabilia; the high-profile presence everywhere from sports arenas and fast-food restaurants. Coke may be “the real thing,” as first proclaimed in 1942, but it knows it won’t stay that way without a substantial makeover.
The Atlanta-based company is hardly at death’s door, of course, and it remains the top purveyor of soft drinks on earth. Its hugely popular menu of products, now sold in 200 countries, includes the world’s first and third best-selling beverages (CocaCola Classic and Diet Coke) as well as about 160 other soda pops, coffees, juices, sport drinks, teas, and bottled waters boasting a virtual who’s-who of familiar brand names (Sprite, Barq’s, Cherry Coke, Fanta, Minute Maid, Hi-C, Fruitopia, Butter Nut, and POWERaDE among them). Even its ubiquitous red-and-white logo and associated imagery are in demand, with licensed Coke merchandise widely available through retailers such as Wal-Mart and F.A.O. Schwarz, along with a corporate Web site.

But there also have been extensive tarnishes to the company’s public image and fiscal fitness in recent years that demanded serious attention. These included a racial discrimination lawsuit filed by black employees in the United States, an extensive product recall, stymied expansion efforts in Europe, a controversial severance package awarded to a recent CEO who vacated his position after just two turbulent years, a strained relationship between the company and its critical network of independent bottlers, and a steep and continuing stock price decline.
As befits a world-changing corporation, however, such attention has indeed been paid since a new top executive took control at the turn of the millennium. And while beverage industry analysts described even his initial moves as comprising the most significant “sea change” that Coke had undergone in decades, the company indicated that such 21st-century fine-tuning of its 19th-century product was not yet complete.

Soft drinks have always been an odd product. Their history dates back to 1767, when carbonated water was introduced. This so-called “soda water” was flavored for the first time in the 1830s. Various con men, hucksters, and legitimate entrepreneurs have been trying to find profitable ways to peddle it ever since. The longest lasting of these efforts initially appeared in 1876, when Charles Hires sold his root beer as medicine. A long line of hopeful competitors—including Dr Pepper—followed. Among them were Coca-Cola in 1886, and Pepsi-Cola in 1890. All were originally considered medicinal products, with Coke supposedly good for headaches, indigestion, and hangovers. One of its earliest sales slogans was “The Ideal Brain Tonic.”
Once the century turned, the soft drink was publicly repositioned as a beverage for everyone. Colas monopolized the market from the start, with Coke and Pepsi beginning their lifelong battle for industry supremacy. Coke moved to sew up massmarket sales by granting exclusive bottling rights to a pair of men in Chattanooga, Tenn. The contract, for one dollar, also marked the birth of the company’s unique strategy of using independent bottlers to mix specific ingredients locally and deliver the resultant product. Aggressive expansion was also a big part of the early plan. By the time Atlanta banker Ernest Woodruff and a group of investors bought the company for $25 million in 1919, some 1,000 of these bottlers were making CocaCola available across the United States, Cuba, Puerto Rico, Panama, the Philippines, and Guam.

With extensive experience selling Coke abroad—where most future growth will undoubtedly be realized—Daft is positioned perfectly to restore the company’s glory. The key to his plan is transferring authority to local managers, who will make critical determinations on products, advertising, and other vital matters according to local tastes. Observers, as always, will be watching closely to see whether Coke remains “the real thing”—or becomes a relic of the past, much like those long-forgotten hangover and indigestion cures that surfaced with it more than a century ago.