Articles by Levick Experts
Companies like Coca-Cola and PepsiCo define American interests. Whatever happens to them in a global marketplace often reflects not only on them as a brand but on their brand as a surrogate for the United States. The “peacetime” benefits of this surrogate brand in foreign markets make it all the more volatile in corporate crisis. It is not just Coca-Cola or Pepsi; it is the personification of America.
So it is hardly surprising that the pesticide-laced soft drink allegations in a recently released report by the Indian NGO, the Centre for Science and the Environment (CSE) and the groundswell it has caused in the world’s largest capitalist market, offer significant twists, both substantive and practical, on the Yankee-Go-Home/Yankee-Come-Back dynamic.
The first twist is that the crisis is being fielded jointly by two of the most competitive rivals in the history of capitalism. At the very least, they have apparently coordinated their efforts to maintain consistency. It’s our guess that their C-Suites did yeoman’s work on a first and fundamental communications challenge – to imbue all team members with the need for absolutely collaborative behavior.
These are great companies and the greatest brand machines in the world. They are to be commended for their efforts in a challenging crisis. In particular, PepsiCo for opening their bottling factories to inspection; Coca-cola for conducting independent tests.
Unfortunately, their initial reaction was to be reactive. They put no face on the crisis and few initial public comments. Crisis craves structure. Visual leadership in a crisis is the most critical action, even if leadership is not at first certain what all the steps need to be.
Second, in terms of the C-Suites, the soda pop industry caught an extraordinary potential break with Indra Nooyi, the new PepsiCo CEO who seems as comfortable wearing a sari in Gujarat as a business suit in New York. Crises are driven by pictures, like the trapped birds we always remember from an oil spill. Here is Pepsi’s secret weapon -- the picture in a market place of 1.1 billion potential consumers does not need to be of farmers filmed on TV using cola to de-bug their fields, but of a woman equally connected to the citizens of her native land as to shareholders worldwide.
Third, corporations not only often underestimate the power of their own global brand in foreign markets, they often underestimate their audiences. Just because India is not yet a wired country, does not mean it operates without a highly effective network. Once critical information entered into the marketplace through the CSE report -- exemplifying the rising power of interest groups in India -- local politicians quickly made the removal of Coke and Pepsi a cause-celeb, and a grassroots movement quickly spread to control the visual communications.
Fourth, companies need to run to the crisis. When the crisis began Coca-Cola referred all journalists to supportive blogs and the phone numbers of interest groups, including the Centre for Sanity and Balance in Public Life, whose message points were widely quoted: "What is all the fuss about? Yes, colas have pesticides [but] the amount is so low compared to other things Indians consume that they can be ignored.” Imagine that “don’t worry, be happy” message in the United States and you begin to appreciate why Indians feel that they are being treated as second class consumers.
Fifth, audiences that feel unappreciated have long memories. When Coca-Cola was banned from India in 1977, a great deal of the brand trust was lost. We are willing to trust a spouse who lied, but we become ever more cautious. They may even need to sleep on the couch for a while. Customers, even Indian customers, abide by the old Irish proverb: “Fool me once, shame on you. Fool me twice, shame on me.”