Former CMO of Coca Cola on the Truth About Marketing

When it comes right down to it, marketing is about making money, said Sergio Zyman, chairman and founder of Zyman Group and former chief marketing officer of the Coca-Cola Company.

“My philosophy of marketing is the philosophy of business, which is to sell more stuff to more people more often for more money more efficiently,” Zyman said in a keynote address at a conference hosted by student-led Chicago GSB Marketing Group October 15 at the Harper Center.

Marketing provides “guidance and navigation” for consumers and customers, Zyman said.

“Consumers change their minds all the time. They’re disloyal. They pay attention to the competitor. They buy new media. They drink stuff they never drank before. They fly on airlines they never flew before. They go for TVs in the back of the seats. They’re difficult people.”

Still, he said, it’s the job of the marketer to find a way to link consumers and customers with products and services.

Consumers revolted when Zyman pitched “New Coke.” Zyman left the company in 1988, but was called back to work by the company CEO in 1993.

Zyman became the first ever chief marketing officer - a title he said he invented himself, with the idea that he worked at Coke to increase its business.

To increase business, marketers shouldn’t study mistakes, they should examine their successes to figure out what works, Zyman said. Take brand DNA, for example. For Coca Cola, it’s “continuity and stability,” he said. “It has nothing to do with refreshment. That’s why everybody got so upset when we changed the formula, because they didn’t know what it tasted like, they just knew it had to be there.”

Zyman said he started Coke’s comeback with a “single guiding idea when I went back: it’s all about the consumer.”

He said he hired 2,000 of the best marketers from around the world and set to work with a $5 million marketing budget worldwide. Marketing staffers would have 20 minutes to pitch an idea by answering just two questions: What’s the strategy? Is it going to make money? The marketer’s pitch then would fall either in a “yes” box or a “no” box. If an idea fell into the “no” box, it never came out again. Changes resulted at the company.

“We went from building infrastructure with bottlers to building brands with consumers, from capturing the growth to capturing the potential, and from share of the soft drink [market] to share of daily requirement [of liquids consumed],” Zyman said.

Zyman and his marketers “became very analytical about the consumer.” They pursued heavy users who drank Coke every day, and worked to ensure that they elected Coke over every other brand every day.

Zyman said he didn’t care whether or not consumers “had that ‘ah’ satisfaction” when they drank a Coke; all that mattered was that they opened the can in the first place.

The result: Coca Cola sales skyrocketed from 9 billion cases a year to 15 billion cases a year. Those sales fell a billion cases the year Zyman left, “which proved that marketing worked, or at least the marketing that I put in place,” he said.   

He bemoaned the current lack of belief in the carbonated soft drinks business within the company today.

“I can’t find anybody at Coke today who has passion for red can Coke,” he said. “I believed in red can Coke.”

First-year student Erica Qualls said she liked Zyman’s “more realistic” angle on marketing, particularly his way of speaking about the consumer.

While marketers must try to meet consumers’ needs, “if they don’t buy it, it was all for nothing. We still have to make money. The truth of the matter is that we always will have to draw the bottom line,” Qualls said.

– Mary Sue Penn