Coke’s CMO: “Companies should feel free to experiment. No problem if you fail”
Coca-Cola uses a “70:20:10” budgeting model, so that 70% of its outlay is directed towards proven marketing tactics, 20% to innovation linked to these activities, and 10% to pure “experimentation”.
Coca-Cola aims to track social sales
ATLANTA: Coca-Cola, the soft drinks giant, believes leveraging social media can generate more online mentions and conversations regarding its brands, and ultimately deliver measurable sales.Speaking to the Business Standard, Joe Tripodi, Coca-Cola’s chief marketing and commercial officer, argued there was a clear pattern as to the primary motivations for using social media. “It is about how you get consumers to express an opinion to generate a conversation and then transact. So, it is about impressions to expressions to conversations and transactions,” he said. Given the rapid proliferation and evolution of digital channels in the recent past, the most effective techniques are far from established. As such, Tripodi suggested that a willingness to take risks is vital. “People are still wading through it. Companies should feel free to experiment. No problem if you fail. That’s our philosophy,” he said. Coca-Cola uses a “70:20:10” budgeting model, so that 70% of its outlay is directed towards proven marketing tactics, 20% to innovation linked to these activities, and 10% to pure “experimentation”. “That includes social media marketing, where we allow people to experiment and fail. Failure is essential for you to grow and come up with the right solution,” said Tripodi. Measurement remains an issue, but the My Coke Rewards online loyalty scheme in the US – via which shoppers can collect points with each purchase then reclaim products and perks – has shown how to yield highly useful data and insights. “People who buy a Coke enter a code. So, we know that people are definitively shopping. So, we are able to close that loop and link and say definitively that My Coke Rewards generated an extra amount of value and volume,” said Tripodi. “When you overlay social media marketing with loyalty programmes, it will close the loop. It will give you the value of the customer and help you target them better.” Such a process could be particularly beneficial as Coca-Cola seeks to enhance its understanding not just of individual purchase occasions, but the longer term connection secured with buyers. “The big play that is coming in consumer packaged goods, which wasn’t there before, is the concept of lifetime customer value. This is common in financial services,” said Tripodi. Data sourced from Business Standard; additional content by Warc staff, 4 November 2011