The Impact of Macroforces on Coke’s Strategy

Tom LaForge, Global Director of Human & Cultural Insights from Coca-Cola

This man has a dream job. Also known as the Global Director of Human & Cultural Insights at Coca-Cola, Tom LaForge’s occupation is to sniff out trends, foresee the future, and position Coca-Cola in the ever evolving consumer market. At my recent trip to Coke’s Global Innovation and Technology Center at Shanghai (courtesy of Coca-Cola), I had the privilege of listening to Tom’s views on macroforces and how Coca-Cola responds to them.

What are the eight macroforces according to Coke? Well, they are:
:
1) Growth of populations;
2) Spread of capitalism;
3) Increasing affluence of consumers;
4) Advances in medicine and psychology;
5) Developments in technology and automation;
6) Inceases in connectivity and mobility;
7) Environmental changes;
8) Globalisation.

These macroforces have changed consumer expectations for brands and influenced businesses. To come up with this list, Tom did an amazing meta-analysis of books covering a whole range of topics from creativity, storytelling, cultural leadership, emotional to societal branding, capitalism, behavioural economics, environmental forces, and positive psychology. If there is a title on Amazon’s business bestseller list, it’d be on Tom’s reading list!

From this content curation, a few things are obvious. First, businesses themselves are evolving and macroforces are responsible for this evolution. Business values are also changing, with the rise of right-brain skills, environmental awareness and social justice.

Consider the change of role models from the suit and tie PC Guy of 1990 to the jeans and tees Apple Guy of 2010. The new corporate heroes are geeks made good like Steve Jobs (Apple), Larry Page (Google) and Mark Zuckerberg (Facebook), replacing corporate shirts like Lee Iacocca and Gordon Gecko.

Courtesy of LADG

Major corporate relationships with governments, global ecosystems, civil society and companies are being reshaped by these macroforces.

In the area of governments, Coca-Cola has worked with numerous causes such as Project nurture in Bangladesh (with the Gates Foundation), providing US$30 million for US AID, and getting Michelle Obama’s endorsement for Let’s Move!

Coca-Cola is also heavily involved in “green” causes, working with the Worldwide Fund for Nature (WWF), assisting Thailand and Vietnam in sustainable agriculture, reforesting areas for erosion control, and introducing the iLohas and Plantbottle to reduce carbon footprints.

iLohas has a bottle you can squeeze to reduce space for transportation (source).

Working with civil societies, Coca-Cola was involved in the Hope for Haiti initiatives to re-establish crops and orchards, as well as various other partnerships.

As Tom shared, these forces have changed dynamics between consumers, brands, marketplace, and companies. The new consumer now plays four roles in four arenas:

1) Government – Citizen
2) Global Ecosystem – Environmentalist
3) Civil Society – Community Member
4) Companies – Consumer

As buying decisions in future will be based on BOTH price and sustainability, consumers want to know about the water footprint, carbon footprint, fair trade practices, and biodegradability of materials used.

To cope with this, brands are changing from

Yesterday (Residual) -> quality and safety to

Today (Dominant) -> identity construction and

Tomorrow (Emerging) -> Societal construction

Positioning itself as a social construction brand, Coke feels that the role of marketers are changing:

1800s – Physical Value and Industrial Revolution

1990s – Analytic Value and Computer Revolution

2000s – Globalisation

The future – CREATIVE VALUE!

So what are the key learning points? Well, our value as marketers come from doing what machines and computers can not do. We should instead embrace the following roles:

1) Storyteller & Meaning Maker (see my post here)
2) Creative
3) Planet Steward
4) Cultural Leadership
5) Emotion Provider
6) Aesthetic Designer

Citing the Cluetrain Manifesto, Tom proposed that future organisations need to speak with a human voice, be transparent, lighten up, have a point of view, be willing to share and encourage internal networking.