Coca-Cola And Its Evolution Essay, Research Paper

Coca-Cola and its Evolution

The Coca-Cola company started out as an insignificant one man business

and over the last one hundred and ten years it has grown into one of the largest

companies in the world. The first operator of the company was Dr. John

Pemberton and the current operator is Roberto Goizueta. Without societies help,

Coca-Cola could not have become over a 50 billion dollar business.

Coca-Cola was invented by Dr. John Pemberton, an Atlanta pharmacist. He

concocted the formula in a three legged brass kettle in his backyard on May 8,

1886. He mixed a combination of lime, cinnamon, coca leaves, and the seeds of a

Brazilian shrub to make the fabulous beverage(Things go better with Coke 14).

Coca-Cola debuted in Atlanta’s largest pharmacy, Jacob’s Pharmacy, as a five

cent non-carbonated beverage. Later on, the carbonated water was added to the

syrup to make the beverage that we know today as Coca-Cola.

Coca-Cola was originally used as a nerve and brain tonic and a medical

elixir. Coca-Cola was named by Frank Robinson, one of Pemberton’s close friends,

he also penned the famous Coca-Cola logo in unique script. Dr. John Pemberton

sold a portion of the Coca-Cola company to Asa Candler, after Pemberton’s death

the remainder was sold to Candler. Pemberton was forced to sell because he was

in a state of poor health and was in debt. He had paid $76.96 for advertising,

but he only made $50.00 in profits. Candler acquired the whole company for

$2,300(Coca-Cola multiple pages).

Candler achieved a lot during his time as owner of the company. On

January 31, 1893, the famous Coca-Cola formula was patented. He also opened the

first syrup manufacturing plant in 1884. His great achievement was large scale

bottling of Coca-Cola in 1899. In 1915, The Root Glass Company made the contour

bottle for the Coca-Cola company. Candler aggressively advertised Coca-Cola in

newspapers and on billboards. In the newspapers, he would give away coupons for

a free Coke at any fountain. Coca-Cola was sold after the Prohibition Era to

Ernest Woodruff for 25 million dollars. He gave Coca-Cola to his son, Robert

Woodruff, who would be president for six decades(Facts, Figures, and Features

Multiple pages).

Robert Woodruff was an influential man in Atlanta because of his

contributions to area colleges, universities, businesses and organizations.

When he made a contribution, he would never leave his name, this is how he

became to be known as “Mr. Anonymous.” Woodruff introduced the six bottle

carton in 1923. He also made Coca-Cola available through vending machine in

1929, that same year, the Coca-Cola bell glass was made available. He started

advertising on the radio in the 1930s and on the television in 1950. Currently

Coca-Cola is advertised on over five hundred TV channels around the world. In

1931, he introduced the Coke Santa as a Christmas promotion and it caught on.

Candler also introduced the twelve ounce Coke can in 1960. The Coca-Cola

contour bottle was patented in 1977. The two liter bottle was introduced in

1978, the same year the company also introduced plastic bottles(Coca-Cola

multiple pages).

Woodruff did have one dubious distinction, he raised the syrup prices

for distributors. But he improved efficiency at every step of the manufacturing

process. Woodruff also increased productivity by improving the sales department,

emphasizing quality control, and beginning large-scale advertising and

promotional campaigns. Woodruff made Coke available in every state of the Union

through the soda fountain. For all of these achievements he earned the name,

“The Boss”(Facts, Figures, and Features Multiple pages).

In 1985, the Coca-Cola Company made what has been known as one of the

biggest marketing blunder. The Coca-Cola company stumbled onto the new formula

in efforts to produce diet Coke. They put forth 4 million dollars of research

to come up with the new formula. The decision to change their formula and pull

the old Coke off the market came about because taste tests showed a distinct

preference for the new formula. The new formula was a sweeter variation with

less tang, it was also slightly smoother(Demott 54).

Robert Woodruff’s death was a large contributor to the change because he

stated that he would never change Coca-Cola’s formula. Another factor that

influenced the change was that Coke’s market share fell 2.5 percent in four

years. Each percentage point lost or gain meant 200 million dollars. A

financial analyst said, “Coke’s market share fell from 24.3 percent in 1980 to

21.8 percent in 1984″(Things go better with Coke 14). This was the first flavor

change since the existence of the Coca-Cola company.

The change was announced April 23, 1985 at the Vivian Beaumont Theater

at the Lincoln Center. Some two hundred TV and newspaper reporters attended

this very glitzy announcement. It included a question and answer session, a

history of Coca-Cola, and many other elements(Oliver 131). The debut was

accompanied by an advertising campaign that revived the Coca-Cola theme song of

the early 1970s, “I’d Like to Buy the World a Coke”(Say it ain’t so, Coke 24).

The Jingle read like this:

I’d like to teach the world to sing

In perfect harmony.

I’d like to buy the world a Coke

And keep it company.

The change to the world’s best selling soft drink was heard by 81

percent of the United States population within twenty-four hours of the

announcement. Within a week of the change, one thousand calls a day were

flooding the company’s eight hundred number (1-800-GET-COKE). Most of the

callers were shocked and/or outraged, many said that they were considering

switching to Pepsi. Within six weeks, the eight hundred number was being jammed

by six thousand calls a day. The company also fielded over forty thousand

letters, which were all answered and each person got a coupon for the new Coke.

A retired Air Force officer, explained in a letter to the Coca-Cola company that

he wanted to be cremated and interred in a Coke can, but now that this change

had come about he was reconsidering(Pendergrast Multiple pages). Sharlotte

Donneally, a thirty-six year old anthropologist said, “I hate the new

stuff”(Demott 60). Wendy Koskela, a thirty-five year old vice president of an

insurance company said, “It’s too sweet. It tastes like Pepsi.” She also

stated, “Real Coke had punch. This taste almost like it’s flat”(Demott 60).

Many American consumers of Coca-Cola asked if they would have the final say.

When Pepsi heard that the Coca-Cola company was changing its secret

formula they said that it was a decision that Pepsi tastes better. Roger Enrico,

the president and CEO of Pepsi-Cola wrote a letter to every major newspaper in

the U.S. to declare the victory, the letter read like this(Oliver 128):

It gives me great pleasure to offer each of you my heartiest

congratulations. After eighty-seven years of going at it eyeball to eyeball,

the other guy just blinked. Coca-Cola is withdrawing their product from the

marketplace, and is reformulating brand Coke to be more like Pepsi…There is no

question the long-term market success of Pepsi has forced this move…Maybe they

finally realized what most of us have known for years, Pepsi tastes better than

Coke. Well, people in trouble tend to do desperate things…and we’ll have to

keep our eye on them. But for now, I say, victory is sweet, and we have earned

a celebration. We’re going to declare a holiday on Friday. Enjoy!

Best Regards,

Roger Enrico

President, CEO

Pepsi-Cola USA

Coca-Cola officials said, “The new formula will boost Coke’s share by 1

percent. That is worth 200 million dollars a year.” Coca-Cola management had

to decide: Do nothing or “buy the world a new Coke”(Things go better with Coke

14). They decided to develop the new formula. Roberto Goizueta, the president

of the Coca-Cola Company stated, “The old Coke formula, with its secret

flavoring ingredient, called Merchandise 7X, will stay locked in the Trust

Company of Georgia bank vault in Atlanta, never to be used again”(Demott et. al

55). This is what many Coke officials said, “This is the most significant soft

drink development in the company’s history”(Demott et. al 54).

The change back to the old Coke was known as the Second Coming. Roberto

Goizueta said, “Today, we have two messages to deliver to the American consumer,

first, to those of you who are drinking Coca-Cola with its great new taste, our

thanks…But there is a second group of consumers to whom we want to speak to

today and our message to this group is simple: We have heard you”(Oliver 178).

On July 10, 1985, eighty-seven days after the new Coke was introduced, the old

Coke was brought back in addition to the new one. This was greatly due to

dropping market share and consumer protest. The market share fell from a high of

15 percent to a low of 1.4 percent(Miller 38).

Roberto Goizueta and Donald Keough took full blame for this failed

product launch. Don Keough, Coca-Cola president, said in response to the

comeback, “The truth is we are not dumb and we are not that smart”(New bottle

18). Roberto Goizueta’s response when the change about, “We have heard

you”(Moore 8). This was said to be a classic marketing retreat. Coca-Cola

executives admitted that they had goofed by taking the old Coke off the market.

One old Coke loyalist said, “The company had spoiled the taste of its ninety

nine year old soft drink and betrayed a national trust”(Moore 8). Ike Herbert,

a Coke marketer said, “You would have thought we had invented a cure for

cancer”(Pendergrast 366). The Coca-Cola company’s eight hundred number

received eighteen thousand calls of gratitude. One caller said they felt like a

lost friend had returned home. The comeback of old Coke drove stock prices to

the highest level in twelve years. This was said to be the only way to regain

the lead on the cola wars(Classic comeback of an old champ 12).

In 1979, fifteen hundred employees moved to the new corporate

headquarters in Atlanta located on North Avenue. The new corporate headquarters

came to be known as “The Tower.” During the time when the research for the new

formula was taking place, it was known as “The Bunker”(Oliver 53). The known

ingredients in present day Coca-Cola are water. caffeine, phosphoric acid,

vanilla, various oils and essences and extracts of the coca leaf and the kola

nut. The one in four hundred part of cocaine was removed from Coca-Cola in

1903(Demott 54). Five years after the infamous Coke fiasco, the Coca-Cola

company tried to bring back the reformulated Coke. The effort to phase in Coke

II into the soda market was quite unsuccessful(Miller 38).

During the Woodruff era, Mr. Woodruff made a promise to the armed forces

of the United States to supply Coca-Cola to every serviceperson. He said that

costs and location did not matter, he supplied 5 billion bottles to the service.

In the mid-1970’s, more than half Coca-Cola sold was outside of the U.S. Coca-

Cola products outsell closest competitor by more than two to one. One in every

two colas and one in every three soft drinks is a Coca-Cola product(Facts,

Figures, and Features 16). The best known trademark in the world is sold in

about one hundred and forty countries to 5.8 billion people in eighty different

languages. This is why Coca-Cola is the largest soft drink company in the world.

Coca-Cola is worth more than 58 billion dollars on the stock market(Coca-Cola,

The Coca-Cola Company 232).

For more than 65 years, Coca-Cola has been a sponsor of the Olympics.

The 1996 Summer Olympics will be held in Atlanta, Georgia, the home of Coca-Cola.

One great earmark that the Coca-Cola company has is helping the people of

Atlanta. They accomplish this through scholarships, hotlines, donations and

contributions, etc. Another large accomplishment that the Coca-Cola has, is

being the first company to make and use recycled plastic bottles. One way to

see all of the achievements of the Coca-Cola company is to visit the World of

Coke in Atlanta. It houses a collection of memorabilia, samples of the products,

exhibits, and many other exciting items(Facts, Figures, and Features Multiple

pages).

All of what has been said is the basis of what Coca-Cola was built on.

Without societies help, Coca-Cola could not have become over a 50 billion dollar

business. Keep on consuming the world’s favorite soft drink, Coca-Cola.