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The Coca-Cola Company is an international beverage and food manufacturer whose headquarters are in Atlanta, Georgia, in the United States of America. It is best known for its flagship product, Coca-Cola. The company's stock is traded under the ticker symbol KO on the New York Stock Exchange and is a part of Dow Jones Industrial Average. It is ranked 1st on Forbes 500.
There are many controversies surrounding the company, its products and its trade practices. Coca-Cola has recently been denounced in the UK for weaning young children onto junk food. In India, the corporation has provoked a number of boycotts and protests as a result of its perceived low standards of hygiene and adverse impact on the environment.
Coca-Cola was invented in Columbus, Georgia by John S. Pemberton, originally as a cocawine called Pemberton's French Wine Coca. It was initially sold as a patent medicine for five cents a glass at soda fountains, which were popular in America at the time thanks to a belief that carbonated water was good for the health. It was relaunched as a soft drink to counter Prohibition. The first sales were made at Jacob's Pharmacy in Atlanta, Georgia on May 8, 1886, and for the first eight months only thirteen drinks were sold each day. Pemberton then ran the first advertisement for the beverage on May 29 of the same year in the Atlanta Journal.
Asa Griggs Candler bought out Pemberton and his partners in 1887 for a reported $2,300. He then began aggressively marketing the product — the efficacy of this concerted advertising campaign would not be realized until much later. By the time of its 50th anniversary, the drink had reached the status of a national symbol.
Griggs also caused a legal headache for the company, as several years later, it was revealed that Pemberton and his original partners had sold the rights to the drink and company so many times, some people were effectively holding 1/32nd of the formula or company. Although much of these were bought back, a few still claimed the right to profits from the drink and company. However, it must also be noted that, in some cases, some partners sold more of the company than they actually owned.
Coca-Cola was sold in bottles for the first time on March 12, 1894 and cans of Coke first appeared in 1955. Asa Candler was tentative about bottling the drink, but the two entrepreneurs who proposed the idea were so persuasive that Candler signed a contract giving them control of the procedure. However, the loosely-termed contract proved to be problematic for the company for decades to come. Legal matters were not helped by the decision of the bottlers to subcontract to other companies — in effect, becoming parent bottlers.
Coca-Cola had a controversial relationship with Nazism before and during World War II. The company adopted an apparent policy of ignoring the Nazis' practice of eugenics and anti-semitism. Indeed, several of Coke's top executives in Germany were prominent Nazi members. When the United States entered World War II, Coke began to represent itself as a patriotic drink by providing free drinks for American soldiers.
The American Army permitted Coca-Cola employees to enter the frontlines as "Technical Officers" when in reality they rarely if ever came close to a real battle. Instead, they operated Coke's system of providing refreshments for soldiers, who welcomed the beverage as a reminder of home. As the Allies advanced, so did Coke, which took advantage of the situation by establishing new franchises in the newly occupied countries. The popularity of the drink exploded in the wake of World War II as American soldiers returned home, more grateful than ever to partake of a beverage that had become synonymous with the American way of life.
In the 1930s, Robert Woodruff became President of the Coca-Cola Company, presiding over the drink and its destiny till his death in 1985. Although he eventually stepped down from his post due to stress, he retained control over the company despite holding positions with an ostensibly low profile. His fanatical devotion to Coke was widely reported, and even in his old age, whenever he stopped by a Coke vendor, he would count how many bottles in the trash belonged to Coca-Cola. This almost devout dedication to the product spilled over to other executives in the company. In recent years, Rick Bronson, a truck driver for Coca-Cola, was fired for drinking a Pepsi (some allege it was actually over his involvement with unions). He was reinstated after a high-profile protest.
In 1985, Coca-Cola, amid much publicity, attempted to change the formula of the drink. Some authorities believe that New Coke, as the reformulated drink was called, was invented specifically to respond to its commercial competitor, Pepsi. Blind taste tests indicated that most consumers preferred the taste of Pepsi (which has more lemon oil, less orange oil, and uses vanillin rather than vanilla) to Coke. New Coke was reformulated in a way that emulated Pepsi. Followup taste tests revealed that most consumers preferred the taste of New Coke to both Coke and Pepsi. The reformulation was led by the then-President of the company, Roberto Goizueta, and the CEO Don Keough.
It is unclear what part Woodruff played in the reformulation. Goizueta claims that Woodruff endorsed it a few months before his death in 1985; others have pointed out that, as the two men were alone when the matter was discussed, Goizueta might have misinterpreted the wishes of the dying Woodruff, who could speak only in monosyllables. It has also been alleged that Woodruff might not have been able to understand what Goizueta was telling him.
The commercial failure of New Coke therefore came as a grievous blow to the management of the Coca-Cola Corporation. It is possible that customers would not have noticed the change if it had been made secretly or gradually, and thus brand loyalty could have been maintained. Coca-Cola management was unprepared, however, for the nostalgic sentiments the drink aroused in the American public; some compared changing the Coke formula to rewriting the American Constitution.
The new Coca-Cola formula subsequently caused a public backlash. Gay Mullins, from Seattle, Washington, USA, founded the Old Coke Drinkers of America organisation, which attempted to sue the company, and lobbied for the formula of Old Coke to be released into the public domain. This and other protests caused the company to return to the old formula under the name Coca-Cola Classic on July 10, 1985. The company was later accused of performing this volte-face as an elaborate ruse to introduce a new product while reviving interest in the original. The company president responded to the accusation by declaring: "We are not that stupid, or that smart."
Coca-Cola Company is the world's largest consumer of natural vanilla extract. When New Coke was introduced in 1985, the economy of Madagascar crashed - vanilla being a prime export - and recovered only after New Coke flopped, since New Coke used vanillin, a less-expensive synthetic substitute. Purchases of vanilla more than halved during this period.
Meanwhile, the market share for New Coke had dwindled to only 3% by 1986. The company renamed the product "Coke II" in 1990, but sales falloff caused a severe cutback in distribution. By 1998, it was sold in only a few places in the midwestern U.S.
As of July 2004, the CEO of the Coca-Cola Company is Douglas Daft.
The exact Coca-Cola formula is a legendary trade secret. The original copy of the formula is held in SunTrust Bank's main vault in Atlanta, the underwriter for the Coca-Cola Company's incorporation. An urban legend states that only two executives have access to the formula, with each executive having only half the formula. The truth is that while Coca-Cola does have a rule restricting access to only two executives, each knows the entire formula and others, in addition to the prescribed duo, have known the formulation process.
As the largest seller of soft drinks in the world, the Coca-Cola Company has had its fair share of criticism for anything from monopolistic practices to low health standards. It is also known for frequently clashing with unions in South America.
Coca-Cola was banned from import in India in 1970 as a result of the corporation's refusal to release the list of its ingredients. In 1993, the ban was lifted in pursuance of India's Liberalization policy. Soon after the relaunch, a study led by the Center for Science and the Environment (CSE) - an independent scientific laboratory in New Delhi - found that Coca-Cola contained residues of dangerous pesticides at levels some thirty times the prescribed Indian and European norms. There were instances of substandard bottling practices by the company: the notorious discovery of a dead lizard inside a sealed Coca-Cola bottle was widely publicized. Environmental degradation in the form of depletion of the local ground water table due to the utilization of natural water resources by the company posed a serious threat to many communities. Finally, there were suspicions surrounding the addictive nature of the drink. As the company refused to disclose the exact ingredients, this remains a matter of speculation. In response to these allegedly unethical practices, several non-governmental organizations launched anti-Coca-Cola campaigns in India.
Coke has also been criticized for its relationship with unions. In Colombia, it has been alleged that Coca-Cola hired paramilitary mercenaries to assassinate union leaders, although much of the evidence against the company is circumstantial. Critics argue that, whatever their source, these assassinations seem to have been helpful to Coca-Cola in eliminating troublemakers from their bottling plants. The Coca-Cola company denies these allegations.
In the 1980s, Guatemala also suffered a spate of mysterious murders of union-affiliated Coca-Cola employees. At one point, paramilitary mercenaries violently occupied a factory. Eventually, after pressure from several organisations worldwide, the conflict was ended when the corporation appointed a new franchise operator who brokered a deal with the union.
There have been troubled (but slightly less publicized) relations between the company and unions in other parts of the world, notably the Philippines, Zimbabwe, and even the United States. In 2002, two Coca-Cola shareholders, the Christian Brothers, presented a resolution at the shareholders' meeting that called for Coca-Cola to adopt a code of conduct on bottling practices and employee relations. The shareholders rejected the resolution, despite the fact that it had received almost unanimous union support in the aforementioned countries.
In July 2004, the United Steelworkers of America and the International Labor Rights Fund filed suit in US court against Coca-Cola and some bottlers in Colombia on behalf of their workers. According to the plaintiffs, the companies "hired, contracted with or otherwise directed paramilitary security forces". The companies deny the charges.
A common belief is that Coca-Cola supports Israel, or Palestine, depending on the proclivities of the urban mythologist. For example, a controversy arose in Egypt when a consumer mistook an Ethiopian inscription on a Coca-Cola bottle for Hebrew, sparking anger amongst Arab consumers of the drink. Coke's Egyptian manager reassured the press that the company would never open a bottling plant in Israel, thereby immediately escalating a local controversy almost to the status of an international incident.
In truth, Coca-Cola had attempted to open a plant in Israel in 1949, but the Israeli government refused the permit, and the company did not push the issue further. A boycott began in the United States, leading to Coke's announcement that they would open a plant in Tel Aviv. This caused fury amongst Arab consumers of Coca-Cola, who in turn — led by the Arab League (with the exception of Egypt, whose boycott only lasted till 1979) — boycotted Coke until 1991.
Pepsi also suffered from boycotts in America after intentionally avoiding Israel. This controversy eventually subsided when Pepsi entered the Israeli market in 1992.
In the wake of the September 11, 2001 attacks, rumors abounded that Coke supported Israel with donations. Although they turned out to be false, numerous calls were made for a boycott against Coca-Cola in the Middle East. However, as a substantial amount of Coca-Cola is produced in a plant in Ramallah, some believe that such boycotts would likely hinder rather than help the Palestinian cause.
The company produces many other soft drinks, including other varieties of Coca-Cola such as Diet Coke (introduced in 1982), which uses aspartame, a synthetic phenylalanine-based sweetener, to eliminate the sugar content of the drink; Caffeine-free Coke; Cherry Coke (1985); Diet Cherry Coke (1986); Coke with Lemon (2001); Diet Coke with Lemon (2001); Vanilla Coke (2002); Diet Vanilla Coke (2002); and Diet Coke with Lime (2004).
Tab was Coca-Cola's first attempt to develop a diet soft drink, using saccharine as a sugar substitute. Introduced in 1963, the product is still sold today, however its sales have dwindled since the introduction of Diet Coke.
The Coca-Cola Company also produces a number of other soft drinks including Fanta (introduced circa 1942 or 1943) and Sprite. Fanta's origins date back to World War II when Max Keith, who managed Coca-Cola's operations in Germany during the war, ran out of the ingredients for Coke, which could be supplied only from the United States. Keith resorted to producing a different soft drink, Fanta, which proved to be a hit, and when Coke took over again after the war, it adopted the Fanta brand as well.
In 2004, perhaps in response to the burgeoning popularity of low-carbohydrate diets such as the Atkins Diet, Coca-Cola announced its intention to develop and sell a low-carbohydrate alternative to Coke Classic, dubbed C2 Cola. C2 contains a mix of high fructose corn syrup, aspartame, sucralose, and acesulfame potassium. C2 is designed to more closely emulate the taste of Coca-Cola Classic. Even with less than half of the calories and carbohydrates of standard soft drinks, C2 is not a replacement for zero-calorie soft drinks such as Diet Coke. C2 went on sale in the US on June 11 2004, and in Canada in August 2004.
Coca-Cola is the best-selling soft drink in most countries. Nevertheless, there are some places like Scotland, where the locally produced Irn Bru is more popular, and Quebec and Prince Edward Island, Canada, where Pepsi is the market leader. Coke is less popular in other places, including some Middle Eastern and Asian countries such as Palestine and India — in the latter, due to suspicions regarding the health standards of the drink, and in the former, due to anti-American sentiment or (debunked) rumors that Coca-Cola supports Israel.
The Coca-Cola Company owns numerous brands and trademarks. Probably the most well-known besides Coca-Cola, Coke, and their various spinoffs are Sprite, Fanta, Tab, Surge, Minute Maid, Powerade, Barq's and Mello Yello (see Coca-Cola brands).
The company is most commonly associated with its eponymous flagship product Coca-Cola. However, it also manufactures many other widely marketed and consumed products, and bottles and distributes other soft drink brands. Some of the other more recognizable brands in their case volume are:
See also: Coca-Cola brands
The company has had several failed branding attempts, including:
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