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Essay/Term paper: Coca-cola and its evolution

Essay, term paper, research paper:  Social Issues

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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
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.


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