Coca-Cola's New Marketing Formula

0:00We are going to talk about Coca-Cola's new marketing formula. So this piece came out from the Wall Street Journal. Okay. So here's what the headline says, those of you that can't see. It says, Coca-Cola's CMO on sidestepping the culture wars, navigating AI, and boosting events over ads. And so, I mean, the lead is kind of in there. But you can see, so they own Diet Coke, Sprite, Powerade, Smartwater. And their brand overall, it continues to fall. Like overall volume share of the US non-alcoholic beverage market remains below its height. So in 2013, it was 28.9%. Last year, it was 23.1%. So it's continuing to go down, right?

0:39But still, everyone knows Coca-Cola. What they're doing is they kind of have a stance that they're not going to get involved. Coca-Cola, that's not of all their products, right? That's all their products. That's all their products. So it's actually decreasing quite a bit. Yeah, that's significant. So 6 % on 29 % or whatever, whatever that ratio is. So for them, look at this. They avoid the fray over human rights in China, often out of running Olympic themed displays, and they just don't want to endorse or criticize any particular group. right and so you know a couple months ago we talked about the budweiser marketing campaign and we're not going to go too much into it but you know at the end of the day coca-cola stays clear of this stuff because they're an international brand so they say look whatever your political preference is whatever your religious preference whatever your sexual preference we welcome absolutely everyone but a different thing is to make a statement that basically favors one against the other it is not our job to enter that and by the way i think that's how most companies my my personal opinion here is not neil's opinion but most companies should just focus on what their mission is.

1:42And if their mission is to help with these causes, then by all means do it. But like, when you think about Coinbase, when you think about Shopify, back two, three years ago or so, they wrote these memos to their team saying like, look, we got to focus on our mission. Shopify, our mission is to help onboard people into e-commerce. Coinbase mission is to onboard more people into crypto, right? It's not to get distracted with these side quests. And the way I look at it, as a business, you got to figure out kind of like what you said, it's your values, your goals, and what they stand by and assuming you and your team agree to them, whatever they may be, that's what you focus on because that's what is core to the culture and the company.

2:19Sometimes those things will grow your revenue. Sometimes they'll hurt you. But if you're staying true to yourself and true to your company and your values, then everything should be okay in the long run, at least from a perspective of being happy and continuing moving forward. Look, and here's the next part, right? So I think this part's interesting. So Coca-Cola was, so the subheader here is pivoting from Web3 to AI. So Coca-Cola is one of the first major consumer brands to integrate generative AI into its marketing campaigns. And this fully bodied embrace has required the company to place less emphasis on the previous topic du jour, Web3 and the metaverse.

2:51So literally a year ago, almost no one was talking about AI and everyone was talking about the Web3 and metaverse. We even had a major program around metaverse that works and the plannings, but that we finally decided not to pursue. So what are the lessons here, you think? They're going where the tension is. And as you can see, no one really cares about the metaverse, not to talk trap on Facebook, but no one really talks about it. Yep. I just think it's a timing thing. I think the metaverse or blockchain technology, all that stuff is still relevant for the long term. But I think it's important to because Coca-Cola, like it's a big branding exercise for them.

3:24It's important for them to stay relevant. And when you're one of the biggest brands in the world, like that is what you have to do. And then finally, this part's interesting. So I don't know if you know this, Neil, but they have been decreasing their spend on like traditional TV commercials have been focused more on event marketing. So like a Superbowl, for example, or maybe like a film festival or something like that. Actually, interesting enough, Neil. So where I live, I can see the golf course where they had the U S open a couple months ago. And when they were setting everything up, I just saw tons and tons and tons of Coca-Cola trucks coming through.

3:57In fact, it was probably the most prevalent truck that I've seen most prevalent brand. I would say. So I like that. And I like the aspect of experience for Coca-Cola. So to take it one level deeper, it's not just events. It's about the experience you're creating for people with your brand. Because the thing that Coca-Cola has, and this doesn't work for all companies, they already have amazing brand recognition. Whether the sales are going up or down, everyone in the world or majority of the people in the world know what Coca-Cola is. So their focus shouldn't be about getting their name out there.

4:26People already know who they are. They're already top of mind. Instead, they should focus on experiences. I think that's what's going to make the brand more memorable. And that's going to want to make people consume more of their products. Now, I do still think it's wise for them to do traditional marketing campaigns, whether it's through digital or offline channels, for their brands that aren't as popular. Because Coca-Cola owns a lot of brands. And some of those brands are really massive, like Coke or Dr. Pepper. I don't know if Dr. Pepper is owned by them or Pepsi. But either way, you get the point.

4:56Some of those brands are just massive. But on the flip side, they own some brands that only do a few hundred million dollars, I'm guessing here. In revenue, they're tiny. Not everyone knows about them. But those products are growing. They're booming. Maybe they're not creating them, but they're buying some of those companies. Those are the ones that they should double down on when it comes to advertising so they can gobble up more of the market share. I'll just end up with this. About a year ago, I went to this event and I met the CEO of a company. I think his first name is Jonathan maybe, but he runs this company called AnyRoad.

5:26and it is the leading experiential marketing platform. He does a lot of deals with, and I'm pretty sure he works a lot of soft drink brands. So, or beverage brands, we should just say. So you can check that out. I've never used it myself, but that's the thing that comes to mind. So that is it for today. Please don't forget to rate, review, subscribe and we'll see you tomorrow.