To survive in the Cola war through controversial marketing

When the American Super Bowl was aired in 2013, I was flying to a business meeting, so I was Bowl to watch the game. But at our company's Israeli headquarters, SodaStream executives are gathering at a bar to watch, with the Super Bowl local broadcast at midnight until 4 o'clock in the morning, and my colleagues don't want to miss the live broadcast. Because SodaStream bought a Super Bowl ad, it was the first Israeli company to buy a Super Bowl ad, and it was a huge investment in the size of our company.

At the time, we were preparing to increase sales in the United States, and Super Bowl advertising was undoubtedly the best way to increase our cognitive level.

More than 100 million viewers saw our ads, but in an unexpected way. Because an ad that was not aired on television has gained more attention.

Our original Super Bowl ad, directed at Coca-Cola and Pepsi, tried to express SodaStream's home bubble machine, which reduced the world's ability to bury 1 billion cans and bottles every day. However, CBS rejected the ad. After many legal arguments, we finally had to adopt a more modest, less provocative ad. However, our controversy has become the headline of many media in the world, from the marketing point of view, this is a very successful investment.

When online video and social media become as important and even more important as traditional radio and television, this experience provides some more effective marketing experience.

Some people think that we deliberately produced advertisements that CBS would refuse to broadcast, but that is not the case. However, we did derive some benefit from the progress of this matter.

New Cola War

When I joined SodaStream in 2007, it was a lifeless company. I used to do consumer marketing and was very keen on delivering goods to retailers. After graduating from Harvard Business School, I worked for 2.5 at the Procter and Gamble Company, a marketing "finishing school".

Subsequently, I worked in Pillsbury Company for 5 years, I in the hometown of Israel launched Haagen Dazs and the Green Giant and other brands. During the dotcom bubble, I spent 3 years in a venture capital company. Then I became the president of Nike in Israel and it was a fun job and I loved the company and its culture.

In December 2006, my friend Yovar Cohen, an investor in a private equity firm, asked me to look at a company he was considering buying. I took half a day off from Nike and met him at SodaStream's headquarters. I was surprised that he would consider acquiring SodaStream because Yovar usually only invests in software and technology companies, not home appliances companies.

The basic principle of home bubble machine is a name guy? Gilby, Guy Gilbey's London gin maker, devised a device in 1903 to inject sealed carbon dioxide into the water to generate bubble water, adding different seasonings to the sparkling water to make different flavors of soda. For about 50 years, the device was used at Buckingham Palace and other British royal families. It was not until the 1970s and 80 that it became a popular consumer product. At the height of the 1980 's, British households with home bubbles accounted for 40%.

However, the next 20, the W&a Gilbey's subsidiary, the business shrank significantly. The company was subsequently acquired by Cadbury Schweppes, but Cadbury Schweppes did nothing to promote SodaStream's main products. An Israeli entrepreneur bought the company in the 1990s, but 2006 years ago SodaStream was on the verge of bankruptcy, no investment, no product innovation, no international expansion-the company did not grow in any way.

After a few hours of talking to the company's management team, Yovar asked me if I should buy the company. I think it has the potential to say: "If the price is right, why not buy it?" Then, go back to Nike and keep working.

Three weeks later, Yovar said he paid 6 million dollars for SodaStream and wanted me to be CEO of the company. I was very surprised because I never wanted to be part of it. But it's a big challenge, and it's quite different from what I've done before, and Yovar promises to give me a stake. My family and friends didn't believe I was going to leave Nike, my son was 13 years old, an athlete, he burst into tears when he knew the news and asked me, "Why, Dad?" At my resignation party, Nike's colleagues gave me an antique soda siphon, and they thought SodaStream was a joke, but I think the company has something to look forward to.

After SodaStream, I hired a new management team, and the most important thing we brought to the company was optimism. The company's managers had no vision or dreams, they were good people, but they liked to boast that SodaStream had 85% of the market share of the "home carbonic acid Industry" – a vague notion that no one knew what the industry was doing. I immediately suggested that we should compete in the carbonated drinks market. We switched ideas and began to focus on turning a factory into a consumer-centric organization. Instead of simply putting bubbles into the water, SodaStream's machines are creating a more economical, sustainable and healthy alternative to conventional soft drinks. We have redefined the product category, determined to increase the share of the global 260 billion dollar carbonated beverage market, rather than being the boss in the so-called "home carbonation industry". I love the idea of competing with Coca-Cola and Pepsi, and we're talking about a new cola war in and out of the company.

"Cage" marketing

Our strategy works because the time is ripe to subvert the category of carbonated beverages. Existing products are not what consumers really want--they contain too much sugar, and packaging waste poses a great danger to the environment. They are inconvenient: since you can use tap water to make an excellent drink in a few seconds at home, why do you have to move the heavy box home from the grocery store? I think the existing brand of carbonated beverages and consumers ' emotional relationship is disappearing. That's why there are so many new bubble drinks out there, including energy drinks, natural soda and flavor water, and so on. Consumers want something else.

So we immediately began to focus on product innovation. Because our machine is on the kitchen table, this is the most precious place in the family, so it must be good-looking and often used-it must occupy a seat in the kitchen. We invited a talented creative director and collaborated with the outstanding industrial designer Ivan Bahr (Yves Béhar), his best-known design products including a variety of Herman Miller chairs and Jambox stereos.

Next, we focus on sales channels. 7 years ago, SodaStream products were sold in 25,000 stores in 13 countries. Now we sell in 60,000 stores in 45 countries. 16,000 of these stores are in the United States, including Sofitel Bath & Beyond, Wal-Mart, Target, Williams Sonoma, Macy's and Staples, among others.

Once new products and sales channels are ready, we need to let consumers know SodaStream. Because the size is small, so our marketing must be very ingenious. SodaStream's annual marketing budget is about 75 million dollars, while Coca-Cola's marketing budget for 2012 is about $11 billion trillion. So the challenge for us is to spend 1 of dollars on the 20 dollar effect and try to stand out in the cacophony and confusion of other products. After we started this work, we thought a lot about how to generate Word-of-mouth, to spread the virus, to build a brand ambassador, and to raise the subject matter. Our biggest marketing achievement is a so-called "cage" activity. A junior marketing officer at the Belgian division of the company came up with this idea, she calculates the average number of cans and bottles that a Belgian household throws away every year, then picks up the same number of pots and jars from the dustbin, and puts them in large boxes like cages to show the huge waste from traditional beverages. In Belgium, the cage is about the size of a minivan. In the United States, an average household throws out 2000 cans and bottles per year, so the size of the cages is three times times that of Belgium. We put these cages in 25 markets to display, are some people with high flow of places, such as the airport, many people will stop to read, thereby promoting visibility.

Then one day we got a restraining notice from Coca-Cola, because an executive at a Coke company saw the cage show at the airport in Johannesburg, South Africa, which thinks we're slandering its brand and claims it has the right to show the cola cans. For this we consulted a lawyer, and it took only 5 minutes to find out that the claim was completely legal: under South African law, if the product was sold, the manufacturer would no longer have the trademark title, which is called the trademark exhaustion. Also, our jars were picked up from the dustbin, and if Coca-Cola claimed ownership of their trademarks it would have been foolish to claim ownership of all the cans thrown away by everyone in the world.

We didn't do any libel, just stating how many cans and bottles were thrown away as rubbish (many people thought most cans and bottles could be recycled, in fact, 70% of them were buried or dumped in parks, seas and incinerators). We did not deliberately create a dispute, but the Coca-Cola Company sent us a letter of prohibition that sparked controversy, and many media outlets reported it. Of course, once we see the opportunity we will take advantage of it and we will not be intimidated. I think it is our willingness to confront big companies that attracts the attention of the world's media.

Game changer

For years, Steven Meyer, the head of SodaStream's US business, has been joking that there are two things that can prove the real success of our company: one we buy a business jet, the other one we can advertise on a Super Bowl. Now, we still don't have a business machine, but Steven Gerrard at the end of 2012 suggested that the company buy the Super Bowl ad, he was serious. We looked at the price and it would cost about 4 million dollars to advertise in the Super Bowl. In my opinion, this strategy is very meaningful. This is an opportunity to inform the US market that SodaStream will become a serious participant in the soft drink industry. The Super Bowl has always been the platform for big new products, Coca-Cola is the Super Bowl of advertisers, Pepsi-Cola sponsorship of the Year's Halftime show (Beyonce performance), we will be on their turf as a subversive image. The longer I think, the more sure I am. I didn't even negotiate with the board members to make a decision, which surprised some of the directors.

We immediately approached the brilliant Alex Boguski (Alex Bogusky), who created our previous ad. Super Bowl ads need to provide entertainment, preferably with a sense of humour. So Alex thought of an idea he called "game changer". I fell in love with this ad at the first sight of the story script: with Coca-Cola and Pepsi trucks parked in front of the supermarket, when the duel music of the dueling Banjos sounded, two truckers would move boxes full of drink bottles to trolleys and scramble to store them. When they enter the door, the plastic bottle will explode and disappear, then the screen switch to a person on the counter to show the SodaStream bubble machine operation, finally he will drink a cup of his own cola. At this point the advertisement of the external sound: "SodaStream let us in the Super Bowl this day to use less than 500 million bottles." "The ad looks perfect, highlighting the process of plastic waste and truck deliveries from carbonated beverages, and highlighting the environmental effects of our products," he said. At that time, I was eager to see the broadcast of the advertisement.

But CBS has other ideas. Their executives objected after watching the ad script, saying we were mocking the truckers, making them look silly, and saying we let the drinks bottle explode and spill over, and the plot of the drink flooded the parking lot was exaggerated. So I applied for an interview with the CEO of CBS and they sent me to a lawyer. I say we don't mock anyone or exaggerate anything. We want a relaxed and authentic advertisement to express our views. I also said that we would try to address their concerns in the presentation of advertisements and then submit scripts to get their final approval. So we started shooting ads and hired the world's top legal experts and advertisers to help prevent the last refusal of CBS.

After seeing the finished ad, I'm sure it's fine. There is no mean or sarcastic place in the ad, we submitted it, but CBS still refuses to broadcast it. There is no reason for this, and our lawyers ' team has no choice. According to our study, this is the first time an American broadcaster has rejected an ad for commercial reasons, not language or lewd reasons (when asked about the matter, a CBS spokeswoman said: "A strategy for free publicity through the creation of disputes always works." That's the way it was before the company, and that's the same thing. "-Editor's note.

In my opinion, the reason CBS refused is because our ads criticized Coca-Cola and Pepsi, and these two companies are very big advertisers. I am very frustrated with this.

Alex Boguski is even more annoyed. He mentioned the incident in an interview with a newspaper in an advertising industry. Then, all of a sudden, the story was all over. We immediately put the banned ads on the web, and countless people began to watch it (the ad has been viewed on YouTube for 500多万次). Even in countries that do not broadcast the Super Bowl, local newspapers are beginning to report on the matter.

Since we have bought the advertising time, the contract is still obligated to broadcast an ad in the Super Bowl, so we submitted an existing name "effect" of the advertisement. It shows that when the unknown brand of carbonated beverage bottles evaporate, a lot of people are using our machine. In fact, its basic ideas and banned ads are consistent, but not so interesting, of course, not so directly against Coca-Cola and Pepsi. The ad was aired in the fourth quarter of the game, and the response was good. Some people worry that advertising will be too late, because if the game is a big rout, the ratings may be lowered. However, we think a lot of people watch the Super Bowl, not to watch the game but to see the ads. The day after the game, an ad critic ranked the 30 ads that were aired during the game, and our ad ranked 7th.

There is no doubt that we get a greater exposure through banned advertising. One of our agencies did a survey and found that we got 6 billion PR impressions because of the controversial ad reports and the frequency of video broadcasts. Al Reese and Laura Reese (Al and Laura Ries) wrote a very wonderful book called "The Decline of advertising, the rise of PR," which is my Bible. PR is more reliable than advertising, I would rather invest in PR than advertising, because PR is for others, not for me to say. In addition, digital media has completely changed the source and quality of consumers ' access to information. As a brand that tries to build awareness in a more efficient way, we need to nurture brand preachers and ambassadors rather than buying a lot of advertising hits and frequencies. The success of prohibited advertising, both from the number of exposure, but also from its quality. The story of this ad conveys the idea that we are selling a product that Coca-Cola and Pepsi don't want people to know about.

In the fall of 2013, we had decided to advertise on the 2014 Super Bowl. Because we make decisions this year earlier, so we have time to better interact with the retailer, we will show in the shop and ensure that the store is in stock. While I was writing this article, I didn't know exactly what the ad was about, but we decided to move the ad to the next stage: Stressing that SodaStream is not just a niche product. The smaller companies that Yovar spent 6 million of billions of dollars in that year now have more than 1 billion dollars in market capitalisation. We are still small, but we are the fastest growing company in the field of beverages. This year, the message from our Super Bowl ad is that SodaStream will take root in the U.S. market.