Case 14-1 Promoting Coke in South Africa

Case 14-1 Promoting Coke in South Africa

Coca-Cola just moved its operating group headquarters from the United Kingdom to Johannesburg, South Africa, to be closer to target consumers. Coca-Cola is the largest consumer goods provider in Africa. To date, the company has grown through close collaboration with its bottling and retail partners. Company headquarters have an aggressive growth plan for the African continent and for South Africa in particular: With a large percentage of the population young and dynamic, this market should be carefully courted.

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As part of its efforts to reach this population, Coke set up the Coca-Cola Africa Foundation, in which the company partners with other organizations to build sustainable communities on the continent. To reach young South Africans in particular, the company hired South African artists that would appeal to this segment of the population to participate in a remix of the “I’d Like to Buy the World a Coke” theme song as a musical montage of reggae, Kwaito, rap, hip-hop, and hard rock. The ad was part of the “Coke Side of Life” campaign, and the theme song was so popular that radio stations added it to their playlists.

South Africa was Coca-Cola’s first stop on the African continent in 1928. The company set up the first bottling and distribution plant in Johannesburg and has expanded its business in the country ever since, employing more than 10,000 people. The company’s presence in South Africa created many more jobs in the country: For every job created by the production and marketing of Coke products, 10 additional jobs, on average, were created in South Africa in related industries.

The Coca-Cola Company sells numerous nonalcoholic brands to South African consumers. Among them are Coca-Cola (with its Light and Vanilla Coke versions), Fanta (with its Orange, Grape, and Pineapple versions), Sprite, Tab, Spar-letta, Lemon Twist, Schweppes, Mixers, Fresca, Minute Maid, Powerade, Bibo, Milo, Krest, Splash, Bonaqua, and Vitango. Its product mix in South Africa is more extensive than in the United States because, in South Africa, the company also bought out a number of popular regional competitors.

During its time in Africa, Coca-Cola ran a few successful promotions. First, in 2002, it hired Riverside Technologies in Wilton, Connecticut, to provide ideas on technologic modifications that would set the brand apart. Riverside came up with modules that could be inserted into the packaging; these modules would sing and announce the winner of a Coke promotion. Consumers who purchased the winning cans were instant winners of Panasonic stereo equipment. The winning cans were filled with carbon dioxide and water, to replicate the weight and feel of a real can, and were assembled into the Coke can by Schmalbach-Lubeca Continental Can in Bonn, Germany. Fifty talking cans were produced for the promotion and were distributed nationally. In just the first month of the promotion, sales of Coke cans rose by 3.2 percent, Diet Coke cans by 18.6 percent, and Fanta by 3.8 percent compared with the previous year. This was in line with the theme of the promotion, “This summer only Coca-Cola talks,” literally—and figuratively, in terms of sales.

Since 2002, Coca-Cola did not have many promotions that had a similar impact. In the spring of 2004, for example, the company coordinated with its advertising agencies another promotion that was not as popular with South African consumers. The promotion asked them to nominate the most inspiring person they knew to carry the Olympic Flame in Cape Town. Distributors were unhappy that they were not involved in the promotion, and generally, it was felt that a more aggressive and creative approach was needed to resuscitate Coke sales again.

In early 2006, Coke hired Conceptualise, South Africa’s leading promotional marketing specialist, whose area of expertise is the development and implementation of promotional competitions and games. The company developed the Coca-Cola Mega Millions game for the South African market, which has captivated South African consumers. Mega Millions had a game-show format, and it was broadcast live during prime time on one of South Africa’s top network channels, SABC 1. In the game, contestants interacted live to win cars and large cash prizes. To enter the game, individuals had to purchase Coca-Cola carbonated drinks, check the label, and find out if they won a prize. Their number also qualified them to enter into a pool of candidates to become a contestant on the live show—a contestant was drawn during each show from the pool of potential contestants. The Mega Millions game was hugely successful, with 22 million entries over a 4-month period.

Case 14-1 Promoting Coke

Case 14-1 Promoting Coke