The Coke Machine - Michael Blanding [35]
At the same time, Zyman shook up Madison Avenue by spreading work among different agencies, having them compete for Coke’s vast advertising war chest. Along with Apple and Nike, Coke even began to contract out to Hollywood powerhouse Creative Artists Agency, which created one of Coke’s most compelling symbols. During the 1993 Academy Awards presentation, TV viewers were introduced to a computer-generated family of polar bears watching the northern lights in a vast expanse of ice with nothing to break up the monotony but the familiar logo of Coca-Cola. The bear clan returned for the following holiday season, Coke’s most successful branding of Christmas since it introduced its Santa Claus ads in the 1930s.
The polar bears were the perfect new branding agent in an era when branding was king. A few years after New Coke taught the Coca-Cola Company the value of its brand name, the rest of Wall Street learned the same lesson when Philip Morris cut the price of its Marlboro cigarettes by 20 percent to compete with generics flooding the market. Immediately Philip Morris’s stock dropped, along with Coca-Cola and many other brands, as the financial press rang a death knell for the brand.
A few weeks after the incident, Goizueta called Wall Street analysts down to an emergency meeting in Atlanta. “We are getting a bum rap,” he whined. “It’s one thing when your stock drops 10 percent because of a mistake your company has made . . . but it’s something else . . . when it drops because of a business with totally different financial and social dynamics.” For the next four hours, he patiently explained why people might not pay for a Marlboro but they would pay for a Coke. And he was right. Coke’s stock righted itself in a few weeks.
As Naomi Klein recounts in her book No Logo, the real lesson of “Marlboro Friday” was that companies needed to invest more money in branding, not less. The companies that succeeded after the recession of the early 1990s were those that wrapped consumers in their products, creating not just an association with their product but a complete lifestyle—think Starbucks, Disney, Apple, Calvin Klein, and Nike. “And then there were companies that had always understood that they were selling brands before product,” writes Klein, citing Coke at the top of her list. As Disney opened Disney Stores in malls across America, Coke followed suit on a smaller scale with Coca-Cola stores in New York and Las Vegas and the original World of Coca-Cola in Atlanta.
The man responsible for of Coke’s new success, however, didn’t live to see it for very long. In 1997, Goizueta was one of the wealthiest people in America—personally worth more than a billion dollars—and because most of his wealth was tied up in stock, he was able to avoid paying virtually any personal income tax. But just at his moment of greatest triumph, he discovered he had lung cancer. Within a year, he was dead.
Goizueta’s sudden departure was a blow to the company’s image on Wall Street, as well as a threat to its ties to the all-important beverage analysts that could keep pushing Coke’s stock price into the stratosphere. Though no one knew it, Goizueta’s death would coincide with a dramatic turnaround in the fortunes of the company. At the time, however, it seemed like the executive he left in charge would pick up his mantle