CLOSE-UP: LIVE ISSUE/COCA-COLA'S NEW GLOBALISM - Is this the end for Coke's 'think local' ad strategy? Cutting costs looks a likely reason to return to a global network, Jenny Watts says

Coca-Cola - the world's best-known brand and also one of its most

notoriously changeable marketers - has once again succeeded in

surprising the industry.



In the blink of an eye, WPP's Ogilvy & Mather network was last week

awarded the global Sprite business from Interpublic's Lowe Lintas &

Partners, while Fanta is set simultaneously to leave Soul in the UK and

Cliff Freeman & Partners in the US.



In compensation, IPG has been handed Diet Coke, which returns to Lowe,

the agency that developed the brand's hunk-fuelled Diet Coke spots. The

network's gain comes at the expense of Wieden & Kennedy, which also

loses Powerade to IPG's third major network, FCB. Meanwhile, Lowe's

sister agency, McCann-Erickson Worldwide, is set to regain the parts of

the Coca-Cola Classic business previously parceled out to W&K, Leo

Burnett and D'Arcy Masius Benton & Bowles.



The question now hanging over the UK shops that handle Coca-Cola

business is: "What about us?" These swift network appointments by the

president-chief executive of Coca-Cola's new-business ventures unit,

Steve Heyer, have sounded the death knell for the much-publicised "think

local, act local" approach to marketing introduced by Douglas Daft,

Coca-Cola's chairman and chief executive, who was appointed at the

beginning of 2000.



At the time, Daft's directive was like manna from heaven to frustrated

marketing directors, who for so long were forced to define creativity by

means of a few local tweaks.



In a spirit of creativity triumphing over centralisation, Coca-Cola

became the multinational that swam against the tide and broke away from

other international corporations continuing to move business into global

networks.



It led to sweeping changes in Coca-Cola's advertising arrangements, not

least in the UK. Coca-Cola GB's marketing director, Charlotte Oades,

gleefully started raiding the UK's smaller shops in moves which saw Soul

hop gladly onto the roster with the Fanta account, along with Coke

Auction. Mother cemented the place it had already secured with Lilt by

adding Dr Pepper, the teen juice-drink Alive, Schweppes and, most

recently, Oasis.



So why has the drinks giant done a complete about-turn? Cutting costs is

a likely explanation. The move into local markets came, literally, at a

price - something that was acknowledged at the time by Oades, who

countered: "If you want to build very deep relations with consumers the

only way is to have local insights." Now that the recession has bitten,

a vast roster of local agencies seems expensive. At the same time, the

soft drinks giant is said to see the seamless global network of O&M as

preferable even to that of Lowe Lintas & Partners.



Much has been made previously of Atlanta's "vice-like grip" over its

territories and what chance the "think local, act local" strategy ever

had is debatable - it seems Coke's responsibility to shareholders to act

cost-effectively in such cash-strapped times is behind its latest

decision.



Yet there are grounds for questioning Coke's timing. The terrorist

attacks of 11 September have emphasised the need for sensitivity to

local beliefs and customs around the world. The return to Atlanta's

imperial supremacy over all global marketing risks breeding resentment

against the Coca-Cola culture that the brand epitomises. Osama Bin Laden

once referred to Americans as the enemy, with their "hamburger and

Coca-Cola values". "You'd think the less homogenous, iconic American

stuff it produced at the moment, the better," one insider close to the

business says.



Coca-Cola's UK roster agencies are understandably twitchy about the

ramifications of Atlanta's decision. Many are producing campaigns and

Coke UK says that it is business as usual. "There is no U-turn," Andrew

Coker, the communications director at Coca-Cola GB, says. "Do you have a

crystal ball? I don't. As we speak at the moment, there is no change."

UK agencies claim that the UK marketing department is making reassuring

noises. "They are saying the UK's a different thing and don't worry

about it," a source says.



But while there have as yet been no formal directives from Atlanta

concerning the UK marketing arrangements, all those close to the new

manoeuvres say it is only a matter of time. The question is just how

much local markets know of the grand plan; much as Coca-Cola UK will

doubtless fight tooth and nail for its autonomy, sources close to the

company say it is inevitable that it will have to toe the headquarters'

line. The sheer size of the operation means that it will take some time

for the changes to filter through to the local markets - as one insider

says: "The UK is something like 18th on its list of priorities right

now."



Quite what kind of advertising will emerge from this U-turn strategy is

not yet clear. It's too early to say whether Coke's new initiative will

allow local markets to adapt the centralised work or merely re-run US

ads.



However, insiders predict there will be a different approach. It is said

that Coke is looking for cheaper, non-TV advertising solutions. In this

area, the ability of local shops to compete with the sophistication of

different marketing disciplines offered by integrated networks is

debatable.



The move echoes Unilever, which two years ago unveiled a large-scale

strategy experimenting with different media. "Coke wants to come up with

something beyond the holy grail of advertising," one close source

confirms.



There's no doubt that any directive from Atlanta will be met with a lot

of resistance from the local markets, where positive steps have been

taken to create real local advertising. The decision to decentralise

marketing power was a brave experiment that has hardly had the chance to

reach fruition.



Just how much Coke will lose by sacrificing the local strategy has yet

to be seen. There's no denying that there's been more interesting work

as a result of the decision, with Mother's work for Dr Pepper winning a

Gold at Cannes.



But, at the end of the day, local marketing directors will not risk

conflict with Atlanta. Sources who've worked on the business say that

even Oades, who has devoted so much to building a local dream-team for

Coca-Cola, would not argue. "Once a decision has been made she will

follow it 100 per cent," one said. "That's just how Coca-Cola

works."



- Stuart Elliott, p19.



COCA-COLA: LOCAL VERSUS GLOBAL ADVERTISING



Local: Coca-Cola McCann-Erickson's London agency introduced the "Life

tastes good" endline with a tale of teen elevator romance in April

2001.



Global: Coca-Cola Atlanta revived the brand's links with Father

Christmas for Christmas campaigns through WB Doner in the late 90s.



Local: Diet Coke Developed by Wieden & Kennedy London, recent UK work

has featured Bridget Jones-style singletons on the lookout for love.



Global: Diet Coke The hunky inspiration for female office workers to

take a Diet Coke break was first dreamed up by Lowe.



Local: Dr Pepper Mother's campaign, with the endline, "What's the worst

that could happen?" picked up a Gold at Cannes this year.



Global: Dr Pepper This sugary Titanic spoof, through Young & Rubicam,

picked up a Campaign Turkey of th e Week award in 2000.



Local: Fanta Ads produced through Soul this year used a UK-specific

creative strategy centred on everyday orange objects.



Global: Fanta Cliff Freeman & Partners' global endline, "Share the fun

wherever," cropped up in this 1998 UK ad from Leagas Delaney.



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