Crisis Management

Michelle LawhonLeslie Tinoco

Michelle GuyetteAugie Blancas

HISTORY OF COCA COLA

Established in 1886

Mission statement: “Refresh the world in body, mind, and soul. To inspire movements of optimism through brands and actions. And to create value, as well as, make a difference everywhere they engage.”

Owns 4/5 nonalcoholic sparkling beverage brands in the world.

NEW PRODUCT SCARE

In 1985, took risk of creating a new product... A recreation of the original Coca-Cola

Formula was changed– which was much sweeter than the original.

Called “New Coke”

This caused brand-loyal customers to switch to Pepsi

http://www.liveleak.com/view?i=554_1203150691

HOW PEPSI BENEFITED

• Pepsi took advantage

•Ad in the New York Times

•14% sales increase over same month the previous year, the largest sales growth in the company’s history

•http://www.youtube.com/watch?v=EMo6o0BtFG8

HISTORY OF PEPSI

http://www.youtube.com/watch?v=P37WgPmkOuM

Pepsi originally began in 1898

PepsiCo has expanded their market with several different product line

PEPSI SYRINGE CRISIS

HOW COCA-COLA BENEFITED

•Last year, Coca-Cola had 41% of soft-drink sales, compared to Pepsi's 32.4%, according to Beverage Digest. 'People Read'

CRISIS MANAGEMENT

Known as a business plan that is implemented quickly when a negative situation occurs

Designing a crisis management plan helps determine how negative events can be avoided.

PREPARING FOR A CRISIS

• provide solid record as a good citizen

•Already established crisis management strategy

•Select spokespersons in advance

•Prepare positive messages about their operations

•Prompt and positive communication

PEPSICRISIS MANAGEMENT

• defensive strategy claiming its innocence

• openly declared that they would pursue legal action against anyone making false claims

•Video cameras

•Important to communicate with the public in order to prove that no crisis actually existed.

•Using Crisis management led to success for Pepsi and they were able to get through the crisis.

COCA–COLACRISIS MANAGEMENT

• taste tests, focus groups and surveys

•Focus groups were ending in negative comments

• Management was trying to come up with new ideas so quick that it was all leading to failure

•Still launched “New Coke”, but only succeeded for a couple months

WHAT WE WOULD HAVE DONE DIFFERENTLY..

Survey questions

“After tasting the new product, would you purchase the new formula over the original formula?”

Because of brand loyal customers...Instead of completely replacing the original formula, we would just add this “new product” to the product line.

Called... Coca- Cola: The Newest Generation

Slogan: Yesterday. Today. Tomorrow.

OUR ADCoca-Cola: The Newest Generation

WHAT WE WOULD HAVE DONE DIFFERENTLY..

Successful

But . . .

We would use the syringe as a creative tool to advertise to the consumers

The message is “just like syringes are needed for medical purposes, people need Pepsi”

OUR AD

Have you had your dosage of Pepsi?

CONCLUSION

Most companies face difficult times that could lead to a financial loss within the company Companies started turning to Crisis Management which is a plan of action that is quickly implemented when a negative situation occurs.

We see with Pepsi and Coca-Cola what happens when you have a plan and when you don’t .

WORK CITED• “Andy’s Pepsiholic Heaven.” Sir Pepsi Website. 14 Feb 2009. <http://www.sirpepsi.com/pepsi11.htm >

“Behind the Coca-Cola Brand” Coca-Cola Web Site. 12 Feb 2009. <http://www.thecoca-colacompany.com/ourcompany/index.html>

“Coke Lore” Coca-Cola Web Site. 12 Feb 2009. <http://www.thecoca-colacompany.com/heritage/cokelore_newcoke.html>

“Coca-Cola Deleting ‘Classic’ From Coke Label” The New York Times Web Site. 12 Feb. 2009. http://www.nytimes.com/2009/01/31/business/media/31coke.html

"Crisis Management." Crisis Management. 2009. Answers Corporation. 13 Feb. 2009 <http://www.answers.com/topic/crisis-management>.

“New Coke 1985.” LiveLeak.com. 12 Feb 2009. <http://www.liveleak.com/view?i=554_1203150691>

“New Coke Search Results”. Coca-Cola Web Site. 12 Feb 2009. <http://search.coca-cola.com/cokecorp/query.html?qt=new+coke&go_button.x=0&go_button.y=0&go_button=Submit&dt=an&nh=20&rf=0&lk=1&ws=1&col=cokecorp&charset=iso-8859-1&ht=0&qp=&qs=&qc=&pw=100%25&la=en&qm=0&oq=&rq=0&ql=a&si=1>

Pepsi-Cola North America. The Pepsi Hoax. 1995

“PepsiCo. History.” PepsiCo. Web Site. 14 Feb. 2009. <http://pepsico.com/Company/Our-History.aspx#1965.page_6>

“The Coca-Cola Company Reports Fourth Quarter and Full Year 2008 Results” . Yahoo! Finance. 12 Feb 2009. <http://finance.yahoo.com/news/The-CocaCola-Company-Reports-bw-14335540.html>