Saturday, August 12, 2006

Korea Coke's CEO gets canned

In a case that likely intrests nobody but me, the head of Coca-cola's Korean operations was canned recently. Yes the article says "stepped down" but that great code word "family reasons" is invoked. He must be too young to resign for "health reasons".

The article further goes on to talk about the recent product tampering scandal with Coke here, and how that may have played a role. For what it is worth, I am sure the reasons his family became so important all of sudden was not that.

Last week Business Week did an interesting feature of Coke's head of marketing, Mary Minnick. Among the things that drover her to one of (if not THE considering the company) top slots at Coke was her time has head of Japanese operations. Not to get into the article too much, what I really want to capture for illustration is this:

In Japan, the company generates the bulk of its profits, surprisingly, from canned coffees and 200 or so eclectic products like Real Gold, a hangover cure sold in a small bottle, and Love Body, a tea marketed to calorie-counting women (and which contains an ingredient that some Japanese believe increases bust size). Coke's marketing team in Japan knew how to ride the trends, introducing as many as 100 new products a year, some with a life expectancy of just a few months. Thanks to constant data reports from 7-Eleven stores, "we knew within the first four weeks if we were going to be in trouble or not," she recalls.

How many of those 200 products do we see in Korea? I cannot think of many Coke products that have made inroads here. I have seen the rather flat launch of Nestea drinks and Qoo fruit drinks (both removed from the market as far as I can tell). Similar things can be said for the recent launches of Coca-cola Zero and the Minute Maid line of drinks.

Those aside, how many new Coke products have we seen in Korea? Not even brand extensions, such as Vanilla Coke or even Diet Sprite, have been sold here from what I see. And yet Coke Japan has been selling upwards of 200 products in addition to carbonated beverages. Heck, even Pepsi has been more expansive on this front in pushing Pepsi Twist, Mountain Dew (novel for Korea anyway), and Pepsi Max. They fail, they try something else. Coke Korea's attitude seems to be "Failure must be avoided, and if do not try we do not fail".

To be fair, this may not be the Korean CEO's fault. This could arise from resistance from Coke's bottler here, Doosan Corp. Alternatively, it could be Coke HQ pressuring Korea Coke not to try and fail.

Anyway, a couple interesting stories, and I wonder if Coke Korea will ever get in step with Minnick's plans for the rest of the global franchise.


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