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Coca-Cola Hunts for Social-Net Formula

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NEW YORK Back in June 2006, a now-famous Coca-Cola video began making the rounds. In it, two men made a geyser out of bottles of Diet Coke and Mentos candies. Coke representatives were not pleased.

Later, another Coke-themed video appeared, this time from France, showing young men throwing cans of the soda into the garbage from impossible angles. It was a neat trick, entertaining enough to draw millions of views on YouTube. But this time around, rather than wringing their hands over their brand literally being thrown into the trash, Coke rushed to embrace the consumer-generated content. It even collaborated with the Lyon-based youth to make another video.

"The biggest takeaway [from the Diet Coke-Mentos video] was consumers own our brands," said Carol Kruse, vp of global interactive marketing at Coke. "We had absolutely nothing to do with it, but we were the beneficiaries. [We] needed to embrace that."

The schizophrenic responses show the uncertain embrace Coke's made of social media as it tries to translate its over 50 years of success in the traditional marketing world to the new terrain. The pitfalls the company has faced and concessions it's made highlight the challenges faced by big brands navigating the new marketing playbook.

The Diet Coke-Mentos experience was only one of several missteps Coke made in its forays into the world of social media. Months earlier, its Coke Zero blog was discovered to be a fake (generated not by consumers, but in-house), while the remake of Coke.com into a YouTube-like site for consumer-generated content (dubbed The Coke Show), launched in July 2006, initially provoked brickbats from outsiders and failed to generate much in the way of submissions or traffic. Even Sprite Sips, Coke's first application on Facebook (the brand was a "landmark partner" on the social net's Social Ads platform) fell flat. Currently, it has just 12 daily active users -- and they're not afraid to voice their opinions. On the comment board, one user described Sips as "crap to the power of suck."

"Coke is throwing a lot of money at trying different things out versus deeply understanding how their customers want to express their experience with the Coke brand," said Denise Shiffman, principal of marketing consultancy Venture Essentials and author of The Age of Engage. "They're used to having these high-production value, high-quality marketing activities. In this marketplace, it doesn't have to be this way."

Coke may not have found its winning online formula, but that hasn't stopped it from trying. Other efforts have included promotions on YouTube to send video holiday cards, a promotional stint on Second Life and an ongoing virtual world called CC Metro. It also has rolled out three more Facebook applications, including a nightlife-themed app, Burn Alter Ego, to promote its energy drink sold in the U.K.

According to Kruse, while some of the company's efforts might not have had the results they'd hoped for, the company has benefited from its experimentation, using what it's learned to adjust future projects. The Burn Alter Ego, for instance, takes its cues from the popularity of social gaming apps on Facebook, such as Scrabulous. The avatar goes clubbing at night and then blogs about it the morning, and playing with it more unlocks additional options. Unlike the Sips application, which was mostly static, the Burn Alter Ego is meant to be dynamic, Kruse said. Additionally, she noted, the branding is done with a light touch.

"We're learning in the social media space what level of branding is appropriate," she explained.

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