Thoughts on Coke and Pepsi's PR Crisis in India
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.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. 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. India in fact does operate with an extremely highly effective network - not the least of which is a large number of intelligent, independent bloggers who have great pride in their country and its economic development.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."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.
About the Author
Richard S. Levick, Esq. is the President of Levick Strategic Communications, a pioneer in global legal media. His firm assists clients in media relations, strategic marketing, branding and reputation management, and legal marketing and litigation PR. More information about the firm and their service offerings is available at http://www.levick.com.
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