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Sergio Zyman, no stand-off Mexican, tapped to break cola stalemate By Richard Morga

Those mystified by the reincarnation of Sergio Zyman as Coke’s marketing guru have lost sight of the cola wars. The wars never we

The cola giants won, of course, but vanquished in the process was a task few market leaders embrace. And that’s to innovate. In the cola wars, especially, innovation has been the province of the little guys.
Royal Crown Cola Co. alone introduced us to soft drinks in cans, turned us on to low-calorie sodas and even pioneered the use of larger-than-one-sitting containers. All the cola giants did was sit back, watch and appropriate.
Same with decaffeinated soft drinks. Although a Royal Crown innovation as well, it was a 7Up campaign that put the decaffeinated issue on the map. Never mind that 7Up’s motive for raising our consciousness was so selfish it sought to undermine an industry that owes its kick to caffeine almost as much as it does to sugar. What the brand’s “Never had it” campaign really wound up doing was move the industry’s giants to come out with decaffeinated versions of their own lines.
No market leaders, regardless of the industry, are more reactive. The Coca-Cola Co. waited almost 100 years to introduce Diet Coke on its own but needed about 100 minutes to commit to caffeine-free flankers once its cola franchise was threatened. In combination, the reactive forces of Coke and Pepsi are so fierce they’ve not only chased off the likes of former 7Up owner Philip Morris but sent predators as awesome as Procter & Gamble, once the confident owner of Crush, in search of less-treacherous prey.
As for today’s RC Colas, Dr Peppers, Sunkists and A&W’s, forget it. “They’re all eviscerated,” says a soft-drink veteran who formerly led one such competitor. “They used to be run by entrepreneurs who liked out-innovating the big boys. Now they’re in the hands of venture capitalists who are playing with assets just to make a buck.”
The result has cast a pall over the entire industry. Although some might argue the births of Crystal Pepsi and Tab Clear demonstrate that innovation is still alive, others point to the same launches as testimony to how dreary the business has become. “It’s a sad day when the industry’s two leaders are as odorless and colorless as their most recent products,” volunteers one longtime observer.
The market clearly agrees. Cola fatigue has hit with such a vengeance that the share commanded by the segment (sugar and diet) has fallen below 70% for the first time since the 1930s. Not even Michael Ovitz, Hollywood’s most ambitious bounder, has been able to cushion the fall. Sure, we in the trade press may have been intrigued, and you in the trade may have been concerned, but the public has responded to Coke’s creative alliance with Hollywood no better than it has to the hype for Last Action Hero.
The commercials themselves didn’t get anyone to rethink the soft-drink proposition as, say, the old 7Up campaign did. They didn’t get us to appreciate classic Coke nearly as much as the launch of New Coke did. They didn’t even create the stir that Pepsi’s syringe scare did. (Small wonder, then, that when apprised of Zyman’s return Phil Dusenberry, the BBDO leader responsible for Pepsi’s advertising, responded without irony, “Tell him welcome back to the cola wars.”)
Agency bashing, no matter how humiliating or public, obviously doesn’t cut it. Otherwise, M. Douglas Ivester, Coke’s evp in charge of the U.S., wouldn’t have been compelled to remove Peter Sealey, the Zyman predecessor whose creative preference for Hollywood over Madison Avenue launched 1,000 stories. That’s because Ivester, in keeping with the new breed of soft-drink management, does nothing that numbers don’t dictate. So much for the good news. The bad news is that the one industry outside Hollywood that was supposed to know it also was selling entertainment has gotten itself into such a state.
Sergio Zyman, who on these very pages became known as “the Aya-cola, Coke’s corporate Khomeini,” used to be a loose cannon. His “ready, fire, aim” philosophy scored a bull’s-eye with Diet Coke. But it also sent him limping to the sidelines to pick shrapnel from his feet with New Coke. Still, Zyman is no soft-drink amateur, and he has no aversion to risk.
His return isn’t necessarily a victory for Madison Avenue, for he’ll surely “terrorize” Coke’s agencies on this tour (verb courtesy of a veteran of Zyman run-ins) as much as he did on his previous tour. Unlike Sealey’s reign, however, Ovitz’s Creative Artists Agency will be subjected to equal treatment. (Note to Hollywood: Imagine your most temperamental star and double it.)
But is a reprisal of Zyman’s role really necessary? Coke obviously thinks so, and, for what it’s worth, so do I. The marketer is, to borrow a Hollywood phrase that’s almost as tired as the soft-drink business, Coke’s oven last action hero.
Copyright Adweek L.P. (1993)