Crisis Management & Coca Cola

Crisis management is the application of strategies designed to help an organization deal with a sudden and significant negative event. (2014). Crisis management is the series of steps that a business must take in order to communicate a problem that they are encountering to the public so that it does not diminish their brand image.

Crisis management is an imperative element of any business. Why? Because it affects the stakeholder, just about anyone who has a relationship with or is affected by the way the business operates.

Of course we all know about the major crisis’s we have seen among businesses and celebrities in the 21st century – with BP and their catastrophic oil spill and the share price drop sickening the public, or the role model scandals which turns the most respected athlete representatives into some of the most hated characters on the planet.

The most interesting in my opinion was a mistake from a world leader. The blue chip multinational ‘Coca Cola’ in 1985 carried out some large changes, which did not go down well with the public. Arguably one of the largest marketing fails in the history of commercialism, which led to extreme public relation tactics to rebuild a brand.

In 1985, ‘Coca Cola’ carried out their own research on a large scale – they approached consumers and blind tested the comparison in taste between ‘Pepsi-Cola’ and the original ‘Coke’ taste. The consumers chose Pepsi to be a better taste, leaving the Coca Cola second. After the R&D at Coca Cola had taken on board this research, they decided to abolish the original Coke and create a brand new taste called ‘New Coke’.

Confidently thinking that this was what the consumer wanted, the loyal consumers of Coca Cola boycotted the brand where many made it clear that although Coca Cola did not have the best taste out of the two, they were loyal to it because of the brand that is ‘Coca Cola’. After sales shot lower and lower, the marketing manager was released and the public relations of a crisis catastrophe began.

After the changes had been made and loyal consumers lost, Coca Cola made it clear that it was a terrible mistake and that they will restore the original Coke and sell it as normal and abolish the New Coke. One of the ways they did this was by incorporating and emphasizing their company mission, of which is to ‘be the brand’, Inspire creativity, passion, optimism and fun. This was very clever as they had something, which they could really emphasize to the consumers who became loyal once again to the brand driven company.

This is a fantastic example of how a company can experience a crisis, not just internally, but externally without planning it. Coca Cola did not know that this was going to occur, they assumed that they knew their consumer too well, and assumed that they could do what they wanted and still maintain their consumer base. This backfired and they had to communicate to the public and those who had been affected to ensure that they could restore their sales.

With good knowledge about the subject matter, the ability not to answer ‘No comment’ and act quickly on the situation a crisis can be resolved in a business context.

(T. Wiffen, Personal Communication, April 17, 2011.)

Crisis management. (n.d.). What is ?. Retrieved October 19, 2014, from http://whatis.techtarget.com/definition/crisis-management

Mission, Vision & Values. (n.d.). The Coca-Cola Company. Retrieved October 19, 2014, from http://www.coca-colacompany.com/our-company/mission-vision-values#TCCC

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