Hoping to reverse its fortunes, Coca-Cola has unveiled its first global campaign in five years. This begins a new chapter for the cola giant, which is coming out of a massive restructuring and sales slump, all while conducting a marathon global agency consolidation review. Will the promise of its new ‘Real Magic’ prove prophetic for the company and its trademark brand?
The global marketing powerhouse Coca-Cola has been awfully quiet since it kicked off a massive reorganization prior to pandemic. Now, as we head into the holiday season, the beverage giant is making some noise with its first global campaign since 2016. Titled ‘Real Magic,‘ the campaign promises to be more Gen Z-focused in terms of look and feel as well as marketing mix.
Selman Careaga, president of the global Coca-Cola category, said during the campaign’s rollout event today that ’Real Magic’ is “a new philosophy that will guide everything we do with our brand,” adding that Coke “will invite everyone to embrace the magic of humanity.”
In the ’Real Magic’ debut spot, a furious World of Warcraft-style esports battle is underway until one of the contestants cracks open a bottle of Coke. After the player’s first sip, the menacing Orc in the game is overcome with feeling. The monster then starts behaving on his own, a la the movie Free Guy, and throws his battle axe to the ground. In a gesture of good will he helps his opponent up. Viewers from across the globe are astounded as suddenly there is peace in the gaming universe. “We are one Coke away from each other” proclaims the ad copy.
The company is hoping these positive vibes translate to sales. Coca-Cola was hit hard by Covid due to lockdown’s impact on its massive fountain drink and convenience store businesses. PepsiCo, meanwhile, was somewhat insulated thanks to its thriving Frito-Lay snacks business and greater focus on supermarket sales.
The Coca-Cola company has been trending up compared to last year but has yet to match the gains of arch-rival PepsiCo. For the first half of the year in the US, Coca-Cola Company owned a 38.9% volume share of carbonated soft drinks – down 0.1%. PepsiCo, meanwhile, was up 0.4% to 29.4%, according to Beverage Digest.
Coke is hoping to build quickly off of the foundation of its newly reconfigured company with a fresh new campaign and a soon-to-be named agency holding company winner. “This is viewed as a rebound/transition year at Coke,” says Gary Hemphill, managing director at the beverage consultancy and research firm Beverage Marketing Corp. “Getting the marketing right is always important. It’s particularly important now so it can continue to build some momentum going into 2022.”
Rethinking Coke’s traditional marketing formulas
Coca-Cola chief executive James Quincey hasn’t been shy about his desire to ditch the Coke playbook in favor or a more tech-focused and data savvy approach. Industry watchers are eager to see how this plays out now that Coke is making its move.
“Typically, Coke chief execs have talked about investing during a crisis,“ says Duane Stanford, editor of Beverage Digest. “It appeared to pull back on marketing during the pandemic, however. The question is, did Coke pull back too much or is it investing in tech we don’t readily see and other things? My sense is it was managing the bottom line during this crisis period and keeping the powder dry for its new emerging strategy and execution plan.”
This first effort out of the gate is heavy on gaming. Coke has partnered with Twitch and the three gaming influencers featured in the ad: Alan Walker, Ariel Powers and Average Jonas.
It also includes Easter eggs within the ad where consumers can find hidden codes in order to win prizes in what Coke is calling one of Twitch’s biggest ever prize pools.
Coke has promised to lean into other emerging channels in hope of luring more Gen Z drinkers as well as other audiences. ”Coke will move away from primarily broadcast communication to creating an ecosystem of experiences for our consumers and people everywhere,” says Careaga.
Getting this ecosystem right will be the biggest task for the holding company that wins this high stakes global agency shoot out. Efficiencies is also a key ask. Manuel Arroyo, Coke’s global chief marketing officer, said in a memo at the beginning of the search: ”We believe we can unlock considerable value through a redesign of our model and consolidation of third-party agencies, and while this effort is expected to generate cost savings, this is not the sole objective of this exercise.” Coke confirmed that a decision is expected to be made before the end of the year.
The end result of all of this corporate reshuffling won’t be ascertained any time soon. “Coke has consultants and can do a restructure in its sleep,” says Stanford. “The challenge will be: how do you fulfill the promise of the structure? How good are you in one, three or five years from now?”