The Coke Machine - Michael Blanding [74]
How a caramel-colored drink from Georgia came to be everything to a remote Mexican village is a long story, intertwined with Coke’s international expansion after World War II. When Asa Candler forecast Coke’s unstoppable growth, and Robert Woodruff imagined Coke “within arm’s reach of desire,” they might have been picturing modern-day Mexico. “¡Toma lo bueno!” read ads blanketing the country—“Drink the good stuff!”—and Mexicans do, 635 cups of Coke beverages annually per person, half again as much as the United States’ 412. In part, it is Coke’s role as a symbol of the American way of life that has made it so popular, and in part, it’s the extremes the company has gone through to get its soda into every village shop and dispensary. It’s nearly impossible to describe the ubiquity of soft drink ads in Mexico, with Coke’s logo painted on houses and buildings along the roads at least every hundred feet.
Along with Canada and Hawaii, Mexico was one of the first foreign countries to sell Coke, dating back to 1897. For the next few decades, the company sold small amounts in Cuba, the Philippines, England, Germany, and other countries. Early sales abroad ranged from sporadic to anemic. In 1927, Woodruff focused on the market with a new Foreign Department, which contracted out with local companies and businessmen to operate plants overseas, eventually spinning off into a separate subsidiary called the Coca-Cola Export Corporation.
The franchise system put into place when Candler accidentally gave away the store proved useful in foreign markets, allowing the company to expand more rapidly and with less risk—not to mention decreasing the company’s liability if anything should go wrong. The company took delight in calling itself a “local” company wherever it went, pointing out that only 1 percent of Coca-Cola Export’s employees were American. Then again, the bulk of the profits—up to 80 percent in some cases—flowed back to Atlanta. And not all countries were created equal. In developing nations, bottling companies were often contracted out to American corporations, such as the powerful United Fruit Company in Guatemala and Nicaragua, or owned outright by Coke, as in India.
However much it championed local autonomy, the company was not above using its lobbying clout to force its way into countries that weren’t so receptive. In Brazil, for example, a law prohibited drinks containing the preservative phosphoric acid, necessary to prevent degradation of caffeine. (Since Brazilian colas contained caffeine naturally derived from the guarana plant, the preservative was not needed locally.) As part of a bilateral trade agreement with the United States in 1939, the country was forced to repeal the law. The agreement also reduced taxes on soft drinks sold in 6½-ounce bottles, a transparent sop to Coke, since local sodas were sold in 12-ounce bottles.
Despite expansion into South America and Europe in the 1930s, Coke’s sales overseas didn’t really pick up until after World War II—thanks to Woodruff’s promise to give soldiers Cokes for a nickel and the taxpayer-funded bottling plants it engendered. In many ways, the company’s international success mirrored that of the country that created it. As Europe lay in ruins, the United States suddenly found itself, along with the Soviet Union, as one of the world’s two superpowers. With the new economic and cultural hegemony came a new resentment from some foreigners, particularly in Europe, where the Marshall Plan facilitated the entry of American corporations, at the same time creating anxiety about the crass commercialism of American culture. In some cases, the opposition spilled out into open protest, often directed against the most obvious symbol of the United States: Coca-Cola.
Local communists, in particular, spread wild rumors about the American drink—warning that it turned children’s hair white