Coca-Cola India

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Category: Business and Industry

Date Submitted: 03/26/2012 09:07 AM

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1. Problem Definition

1.1 Coca-Cola’s Problem

Coca-Cola, deemed the “#1 Brand in the World,” has been a successor in the soft drink industry for over 100 years. Along with their success they have incurred crises along the way. One in particular is the Coca-Cola India Case Study. On August 5, 2003, Coca-Cola India was attacked by The Center for Science and Environment (CSE), an activist group of engineers, scientists, journalists and environmentalists in India, for unsafe products, said to contain pesticide residues which surpassed global standards. Coca-Cola India’s products were attacked in a press release stating: “Twelve major cold drink brands sold in and around Delhi contain a deadly cocktail of pesticide residues.” The tests done on three samples of 12 PepsiCo and Coca-Cola brands were said to contain 30-36 times the global standards of pesticide residue. The pesticides found were known to cause disease such as cancer, birth defects, and severe disruption of the immune system, among other health conditions.

1.2 Coca-Cola’s Concerns

As any company this accusation posed great fear and concern for Coca-Cola Company and their future standing in India. After the discovery of the pesticide residue, the Indian Government banned Coke and Pepsi products. Thus, Coca-Cola stock dipped $5 in the New York Stock Exchange. Pepsi and Coke’s response to the accusations were denying CSE’s validity. Pepsi conducted their own tests independently and results showed no detectable signs of pesticides.

1.3 Company’s Challenges

Because of the attacks by the CSE and NGOs (Non-Governmental Organizations) on Coca-Cola, the brand faced many challenges. First, being the world’s most valuable brand whose value is greatly influenced by the image of the company and its products, their primary problem was trying to rebuilding their image to the Indian public and regaining Indian consumers’ trust. This was a hard task because

NGOs have high...