Will Coke alter Zyman formula?

There’ll have been no moist handkerchieves at the New York headquarters of McCann-Erickson when news broke last week that Sergio Zyman had resigned as chief marketing officer of Coca-Cola.

Zyman is accounted pretty much a genius in marketing circles. If any one, other than Coke’s recently deceased chairman and chief executive officer Roberto Goizueta, can take the credit for reinventing the world’s most powerful brand, it is Zyman. He was, and is, a colourful combustible character in a world of grey suits and corporate anonymity. Such people may get things done, but they also make powerful enemies.

McCann had good reason to be resentful of Zyman because he had gradually squeezed it from the global agency roster it had comfortably dominated for the previous 30 years. But his lack of friends showed more tellingly elsewhere: among boardroom executives and shareholders. When Doug Ivestor, Coke’s chief operating officer and Zyman’s immediate boss, moved up to the top position following Goizueta’s death, Zyman failed to make a similar step change – into Ivestor’s former position. The man who said there are no rules to marketing is now claiming, rather implausibly, that he resigned to write a book about it. Others have connected him with Nike and Microsoft.

At all events, McCann will be trying to exploit his departure by persuading his successor to unravel the skein of global agencies that are his most visible legacy. How easy will it find that task? Conventional wisdom would suggest not too difficult. Coke stands out as a bit of a maverick among global brands. In recent years it has set itself against the trend towards centralisation of the agency roster, a trend favoured by IBM, Compaq, Reckitt & Colman, SC Johnson, to name but a few. Instead, Zyman sought to assemble a cluster of talented ‘local’ agencies under the worldwide strapline of ‘Always Coca-Cola’. The tactic worked: it not only fulfilled the need to ‘think global, act local’ but promoted healthy competition in the creative department. Indeed, Zyman’s achievement went further: in his determination to achieve creative results, he challenged the advertising industry itself by looking beyond its borders and setting up a ‘virtual consultancy’ at Mike Ovitz’s CAA (normally better known for its roster of Hollywood film stars than advertisers). Later, when Ovitz defected to Disney, he and Zyman plotted to set up a Disney-funded agency with Coke as it client.

Yet, while Zyman’s approach has proved productive – and put Coke even further ahead of its rivals – the system he has bequeathed is also difficult and rather costly to manage. It would be tempting for Zyman’s successor, Charles Frenette, to make his mark early by calling a review. Tempting, but not necessarily a good idea.

News, page 12; News Analysis, page 24