Coke Restructures US Business, Fires CMO

06 January 2005

Coca-Cola, Tsar of global brands, is on less hallowed ground in its own backyard, where sales have declined over the past year - propelled by obesity concerns.

The traditional remedy for sagging sales has been applied: fire the marketing boss.

Coke chairman Neville Isdell, who took up his position last May, reacted with the usual kneejerk by inviting the chief marketing officer and head of retailing for Coca-Cola North America to walk the platinum plank.

Clutching his payoff, Javier Benito has quit the company, his former role now shared between Melody Justice, senior vice-president for strategy and planning and John Hackett, general manager of Coke's North American water business.

Justice becomes president of the retail operation, while Hackett assumes responsibility for marketing.

Benito, a Coke staffer for ten years, rose from Fanta brand director to a range of senior positions in Europe and South America before relocating stateside.

According to analysts he has paid the price for the dismal US launch in 2004 of C2, a lower-calorie drink intended to halt the retreat of health-conscious consumers from classic Coke. Critics pin the failure of the new brand on its premium pricing.

Comments John Sicher, editor of industry newsletter Beverage Digest: "It made sense to split up the retail and marketing roles because they were too big for one person."

That view was endorsed by Don Knauss, president of Coke North America, who said separation of the retail and marketing functions will allow the company to compete more effectively in its key home market.

Knauss also intoned the ritual panegyric for the departed, praising Benito's "leadership, strategic thinking, creativity and passion".

In another move, Coke's chief creative officer for North America, Esther Lee, has been promoted to a worldwide role reporting directly to global cmo Chuck Fruit.

Data sourced from Financial Times Online; additional content by WARC staff