Coke and Pepsi stumble in India - Business - International Herald Tribune - The Diigo Meta page

• 22 Aug 06
  

  Murali

  business coca-cola cola controversy india industry pepsi pesticide

  • two of the world's biggest brand names failed to do what they do best: pitch the virtues of their products directly to their customers
  •  The unfolding battle offers a cautionary tale for multinational corporations doing business in the developing countries, especially one like India where the political sensitivity to foreign influences is potentially fatal.
  •  "They got behind the curve and now they are chasing the crisis,"
  • The same environment group said it found pesticide residues in their products in 2003, and lessons from that episode still linger.
  • Indian employees sensitivities to local priorities came into conflict with corporate hierarchies and the need to get approval from headquarters on the other side of the world.
  •  But Coke and Pepsi should have known better,
  • Sunita Narain, who heads the group, "has serious concerns about pesticides in the food chain,"
  •  "By focusing her attention on the soft drinks industry, she gets a lot of attention," Bjorhus said.
  •  "We are living in a new, very aware India," said Amit Agnihotri, a public relations analyst in Delhi. "We have 36 news channels. People are interested in what is happening around them. Coke and Pepsi haven't understood the power of this new India. They tried to wish this problem away, by ignoring it, by not responding to it. That won't work any more."
  •  The companies also failed to realize how fast news travels in modern India,
  •  Coca-Cola also decided to go on the attack, though indirectly.
  •  "I have tried my level best to communicate this information," he said. "But even terminology like PPB - parts per billion - is difficult to comprehend. This makes our job very challenging."
  • Standards for safe pesticide levels in drinks have been agreed on in India but never made a legal requirement. The industry continues to argue over whether tests are needed for the final product or the water that goes into the drinks. There is also debate over how to cleanse sugar of its pesticide traces and a recognition that India's groundwater is so badly contaminated that most food products contain some pesticide residue.

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