“We are radically against ambush marketing”

Ricardo Fort, vice-president–marketing, Coca-Cola India, speaks to Ashpreet Sethi about the company’s advertising ethics, marketing strategies and the controversial cola wars

Ashpreet Sethi (ML): There have been many questions raised about the quality of aerated drinks and people have become sceptical. What do you do to ensure that people have confidence in the quality of your products?

Ricardo Fort (RF): I wasn't here (in India) when these accusations surfaced, but the company has initiated a lot of communication not only with consumers, but also with the government and the press to make sure that people are aware of the facts. Once the facts were verified, the concerns did disappear. We always take the initiative to tell people what our products are all about. For example, we take children and adults to our plants to show how we manufacture our products, and the standards that we follow here are the same as in other countries. Coca-Cola is one of the few companies whose products are exactly the same across the world.

ML: Can you suggest what ASCI can do, like other such organisations across the globe, to work together with marketers. Many a times, your ads are held up by ASCI due to dangerous stunts portrayed in them, like in the case of Thums Up.

RF: The biggest role that they can play is by promoting a dialogue. The best way would be to get everybody on one platform and make things works. I am a big believer of self-regulation and all of us are responsible for the welfare of society.

This is what happens elsewhere, like in the US and Brazil, and I am convinced that we are following the right path here as well.

ML: Any new marketing strategies you are coming up with?

RF: The strategy has been pretty much the same for some time now… diversification and taking our products to places where we weren't present before. Along with TV, which is the hub for advertisers, the market is going to look at other areas as well, including the digital medium which holds a lot of promise.

ML: Last month, in a bid to pre-empt any binding government action, sixteen food and beverage companies announced a pledge to reduce 1.5 trillion calories from their products in the US by the end of 2015-ostensibly to fight obesity in the US.

Are US-based companies planning any such move in India?

RF: That has been a good move. I cannot tell you at what stage it is in right now, but I will be in a position to do so in a couple of days. The same move which is happening internationally is happening in India as well. We are a part of this network and we behave in the same manner as we do anywhere else.

ML: Coca-Cola has taken initiatives to approach children and schools for engagement opportunities. What are these initiatives like?

RF: I will give you two examples. In the southern states, we organise football tournaments which have almost 1,000 schools participating. We also have the nation-wide Limca quiz which attracts participants from more than 1,000 schools.

The Limca Quiz and the Limca Records are two of our biggest initiatives. So we are very much in touch with schools and their management, but we don't provide product samples to schools unless they specifically ask us to sell our products to them.

ML: Can you elaborate on how Coca-Cola ensures that its commercials do not cater to children below the age of twelve?

RF: We don't advertise in TV channels or programmes that are targeted at people below the age of twelve.

ML: But then children don't really watch only children's channels; they watch everything under the sun. How do you work around that?

As a father, I make it a point to be aware of what my daughters are watching on TV. It is always up to the parents to decide whether children can stay up late and watch TV. If I come across any ads which are inappropriate for kids, I will complain as a responsible father and a concerned citizen. 

ML: Coming back to your Thums Up ad, which has stunts that can negatively influence children. What about the complaints you get about such ads?

RF: We have never had complaints or negative comments about these ads as such. Such scenarios are commonly portrayed in Hindi cinema which is very popular among both children and adults.

ML: The cola wars are legendary. What is your view on advertising claims of being so much percent better than a rival company's product and indirectly using colours that your competing brands use?

RF: I think it is an unnecessary distraction because there is so much you can talk about your own brands. Our company is very much against distracting consumers and we don't do what other people are doing. And we are radically against ambush marketing.


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Worried over inflation, RBI may hike rates before policy: Experts

The RBI, which is slated to announce its quarterly review of the annual monetary policy on 27th July, may effect a 0.25% hike each in its repo and reverse repo rates well before the policy

Chances of the Reserve Bank of India (RBI) hiking its short term policy rates by at least 0.25% ahead of its July policy brightened today with the inflation shooting past 10% in May, reports PTI.

The inflation, measured by Wholesale Price Index (WPI), rose to 10.06% in May against 9.59% in April and a revised figure of 11.04%. It is expected to remain so till August on account of base effect and higher food and fuel prices.

The RBI, which is slated to announce its quarterly review of the annual monetary policy on 27th July, may effect a 0.25% hike each in its repo and reverse repo rates (overnight lending and borrowing rates) well before the policy, Bank of Baroda, chief economist, Rupa Rege Nitsure said.

"Inflation is not coming down structurally and demand for foodgrains is growing substantially. I feel that RBI will have to raise rates by 25 basis points (bps) even before the policy," Ms Nitsure said.

The RBI hiked its policy rates by 0.5% each and cash reserve ratio or the mandatory cash reserves for banks by 1% so far this year to unwind the monetary stimulus provided after Lehman-crisis shook the global markets and threatened the domestic economy.

There are expectations that the RBI, in the face of tight liquidity conditions owing to third generation (3G) auction and advance tax outgo, may resort to hiking only the reverse repo rates and may leave the repo unchanged until cash flows ease in the system.

Around Rs38,000 crore fee from winners of broadband wireless access (BWA) auction and nearly Rs30,000 crore advance tax payment will move out of the system in the next 10 days, which has left the money markets worried.

"Yes, we do see possibilities (of pre-policy rate hike). Inflation being where it is, there is a chance of rate hike before the policy. More likely it would be a hike in reverse repo rate," Ashutosh Datar, an economist with IIFL, said.

Planning Commission deputy chairman, Montek Singh Ahluwalia today said the RBI should take policy steps to curb the galloping prices, which has hit the common man and is now spreading to the manufactured items.

Tight liquidity conditions have already pushed up the short-term rates while on the other side, banks have also indicated that lending rates in the system will move northward on another round of rate hike from the central bank.


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