Case Study: Coca-Cola India (Case Study Sample)

Instructions:

Read Case 10-1 (“Coca-Cola India”) in Corporate Communication and respond to the following questions. • What are the key problems that Gupta should focus on in the short term and in the long term? • What is your recommendation for Coke’s communication strategy? • Who are the key constituents? Could Coke India have avoided this crisis?

Coca-Cola India
On August 20, 2003, Sanjiv Gupta, president and CEO of Coca-Cola India, sat in his office contemplating the events of the last two weeks and debating his next move. Sales had dropped by 30-40 percent1 in only two weeks on the heels of a 75 percent five-year growth trajectory and 25-30 percent2 year-to-date growth. Many leading clubs, retailers, restaurants, and college campuses across India had stopped selling Coca-Cola.3 Only six weeks into his new role as CEO, Gupta was embroiled in a crisis that threatened the momentum gained from a highly successful two-year marketing campaign that had given Coca-Cola market leadership over Pepsi.
On August 5, the Center for Science and Environment (CSE), an activist group in India focused on environmental sustainability issues (specifically the effects of industrialization and economic growth), issued a press release stating: "12 major cold drink brands sold in and around Delhi contain a deadly cocktail of pesticide residues" (see Exhibit 10.1). According to tests conducted by the Pollution Monitoring Laboratory (PML) of the CSE from April to August, three samples of 12 PepsiCo and Coca-Cola brands from across the city were found to contain pesticide residues surpassing global standards by 30-36 times, including

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Running Head: CASE STUDY: COCA-COLA INDIA
Case Study: Coca-Cola India
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Key Short-Term Problems
The first short-term problem for Sanjay Gupta is developing an adequate response to the allegations by the Center for Science and environment that revealed that some of Coca-Cola’s products contained evidence of pesticide residues (Argenti, 2009, p.274). This will serve to effectively revamp the trust held by customers in regards to the products offered by Coca-Cola Company. The second short term problem is the rebuilding of the reputation of Coca-Cola. This problem involves the first stage of crisis management which signals the need to ensure the crisis is limited only to the India market, and does not pill over.
Key Long-Term Problems
The first long-term problem facing Sanjay Gupta is the corporate social responsibility image of Coca-Cola India. According to Argenti (2009, p.283), Coca-Cola’s CSR philosophy is “to benefit and refresh anyone who relates with their business.” However, from the case study, it appears that the standards of manufacturing applied by Coke India differ with those applied by Coke Europe and America, which raises the question; is Coca-Cola India socially responsible to its stakeholders? The second problem is how to rebuild the brand value of Coke and protect its market share. Both these two problems directly affect the total long-terms sales of the company in the Indian realm, especially considering the local Indian competition and other multinationals such as Pepsi.
Recommendation for Coke’s Communication Strategy
Coke’s communication should be based on as much information as possible; it should be made early and frequently; and finally, it should be directed to the affected constituents.
Who are the Constituents?
The constituents in the context of the case study repre...

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Case Study: Coca-Cola India (Case Study Sample)

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