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STEPS TAKEN BY PEPSI & COCO -COLA TO COUNTER NEGATIVE PUBLICITYBony Joseph
S2 MBA
ROLL NO. 10
NEGATIVE PUBLICITY
• Negative publicity is a deliberate attempt to manage the public's perception of a subject with an intention to demote it to an extent that it arouse public interest in it.
• It is the adverse publicity that a firm may incur due to a particular reason, which may lead to potentially disastrous consequences.
• It results in the firm’s reputation among its customers and competitors being badly tarnished.
EFFECTS
• Business does not flourish under negative publicity.
• Firms may have to call back all their products.
• Shares of the firm may take a frightening dip.
• Lead to the firm having to shell out millions as compensation, and the venture might even go bust.
How do you counter it?
• Golden rule is- Don’t Panic!
• Look into the problem
• Work out a plan of counter attack
• Follow up progress continually
• Give out concrete proofs of safe-practices
History
• Coca-Cola was founded in May 1886 by Dr. John Pemberton
•Coca-Cola was first sold to the public in Atlanta at Jacob’s Pharmacy
•Only 9 servings of the soft drink were sold each day
Sales for the first year were only $50
• In 1888 Asa Griggs Candler bought the company and sales increased over 4000%
• Until 1905, the drink was marketed as a tonic containing cocaine
• This stopped the advertisement of Coca-Cola as being a cure for headaches and other illnesses
Today
300 Brands - 200 Nations
International Products
Canada and BelgiumTaiwan
Sponsorships
• Art of Harmony
•Boys and Girls Club of America
• Children’s Miracle Network
• FIFA
• NASCAR
• Olympics
• Special Olympics
• Tiger Woods Foundation
Promotions
• Diet Coke Movie Mania Give away
- win a trip to the Sundance Film Festival
• American Music Awards
NEGATIVE PUBLICITY-COKE
•In 2003, it was revealed that several midlevel employees had rigged a marketing test for Frozen Coke done three years earlier at Burger King Restaurants in Virginia. •The scandal led to the departure of the head of Coke's fountain division, and the company issued an apology to Burger King and its franchisees and offered to pay them US$21 million.
•In the early 2004, the launch of the Dasani brand into the European market was cancelled when bottles in Britain were found to contain elevated levels of bromate, a substance that can cause cancer after long-term exposure.
•In India, during September 2006, Coca-Cola was accused by the Center for Science and Environment (CSE) of selling products containing pesticide residues.
•Coca-Cola products sold in and around the Indian national capital region contained a hazardous pesticide residue.
•These pesticides included chemicals which could cause cancers, damage the nervous and reproductive systems and reduce bone mineral density.
•Besides, Coca-Cola’s products are always labeled as “junk food”. People criticize Coca-Cola’s beverage contain too much sugar and high is calories. It is labeled as one of the important factors of causing serious obesity rate in developed countries.
•Such negative publicity could adversely impact the company’s brand image and the demand for Coca-Cola products. This could also have an adverse impact on the company’s growth prospects in the international markets.
History• The Pepsi Cola Company began in 1898, but it only became known as PepsiCo when it merged with Fruto lay in 1965.
• Tropicana was acquired in 1998 and PepsiCo merged with Quaker Oats and Gatorade in 2001.
• PepsiCo’s snack food operations (Frito Lay….) had their start in 1932.
• PepsiCo began its international snack food operations in 1966.
• Until 1997 , it owned Taco Bell, Pizza Hut, KFC.
Companies owned by Pepsico:Frito LayGatoradeTropicana (aquired in 98)Quaker Oats
Pepsi brandsDiet Pepsi7UPMountain DewLipton Iced tea (partner)MirindaLays/ Doritos…..
NEGATIVE PUBLICITY-PEPSI
• Cases being filed against Pepsi that there was syringes, needles, pins, screws, a crack cocaine vial, and even a bullet have been found in Diet Pepsi cans
• “In one week’s time, more than 50 incidents had been reported to the police, the FDA or the media”.
• Pepsi was not sure of why these incidents were being reported. Pepsi had to research on why these claims were being made against their company.
• Pepsi was going to defend their company and not recall any of their products. Pepsi wanted to show the country that there was no possible way that these objects could end up in their products at the different factories.
Ways to Handle Negative Publicity
1. Confront the source.
2. Make amends.
3. Acknowledge mistakes.
4. Enlist supporters to speak on your behalf.
THANK YOU
