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Cola combat; Pepsi quenches a thirst for sponsorship as Coke lets some promotionals go flat.

Cola Combat Pepsi Quenches A Thirst For Sponsorship As Coke Lets Some Promotionals Go Flat

Last year, the Frank Lyon Co. sold the Coca-Cola Bottling Co. of Arkansas to the national Coca-Cola Co. in Atlanta in a reported $250 million deal. People wondered if a change in fiscal philosophy would accompany the change in ownership. Would this out-of-state player be more concerned with dollars and cents than a locally-owned operator with a track record of community involvement?

To some, the answer appeared to be "yes" after Coca-Cola opted not to compete with Pepsi-Cola Co. for the right to sponsor Riverfest, Jazz Lights Festival and HoopFest - three of Little Rock's bigger events. Some viewed the cutback in promotional sponsorships, involving discounts on soft drink products and sometimes thousands of dollars in cash contributions, as an act of homage to the almighty bottom line.

"At the time, they had some sort of corporate decision not to do any local special events," recalls Stan Jackson, a liaison for the Jazz Lights Festival and Natural State Capitol Criteria Bike Race. "Obviously, it was a corporate error. People get to looking at the bottom line and forget about community involvement."

Walter White, president of Coca-Cola Bottling Co. of Arkansas, defends the stance of his company. "We get on average 10 to 15 solicitations every day for donations or sponsorships," White reports. "We go as far as our budgetary limitations will allow us. It's better to reach as many people as possible rather than spending a lot of money on one event. We weigh how each project affects the community."

That explanation loses a little bit in the translation when taken in the context of HoopFest. Coke's withdrawal from the event has the trappings of a corporate snafu, an inattentive mistake made during the ownership transition. "The lines of communications were not solidified," White concedes.

The Big Events

No one was more chagrined by the announcement that Pepsi would be sponsoring HoopFest 1990 than the Coca-Cola representative who showed up at the press conference thinking his company would once again be sponsoring the three-on-three charity basketball tournament.

The problem was execs at Coca-Cola Bottling Co. of Arkansas neglected to pass the word along that they wouldn't be sponsoring HoopFest. In fact, the company failed to even make a bid proposal despite repeated solicitations from event organizers.

"I wanted to deal with Coke because I had in the past," says Valentine Hansen, tournament director for HoopFest. "We asked them weeks before the press conference if they would help sponsor the tournament again this year, but there was no response until the day after we had announced that Pepsi and Alltel would be working with us. Then Coke wanted to participate, but it was too late."

HoopFest (formerly known as Hoop-De-Do), which last year drew 3,000 B-Ball players to downtown Little Rock and raised $35,000 for Arkansas Easter Seals, had worked with Coca-Cola Bottling of Arkansas for the past two years. Pepsi Cola moved in to nab the sponsorship of HoopFest and Jazz Lights from Coke while retaining its traditional hold on Riverfest.

While Pepsi has made hay in some of the fields formerly worked by its chief competitor, Coca-Cola is still the dominant force in the market among soft drink companies. Coke continues to sponsor big draws like SummerFest and Pops On The River.

I'm certainly not running them out of business; that's for sure," Bill Jones of Pepsi-Cola wryly observes. "Sometimes we win. Sometimes we lose. They have their fair share."

HoopFest's Hansen considers Coke's tardy response an indication of less involvement in Arkansas charitable activities. However, Bruce Blackwell, Coca-Cola's local corporate marketing manager, disagrees: "Absolutely not."

Out-Of-State Ownership

Blackwell cites a new promotion with Arkansas Children's Hospital as just one of many activities the corporation continues to work with in the area of non-profit activities.

Arkansas Easter Seal's marketing coordinator, Carmen McHaney, concurs, adding that Easter Seals has picked up an hour of sponsorship for their annual telethon from both Coke and Pepsi.

Like Blackwell, Bill Jones, director of cold drink for Pepsi-Cola Bottling Co., believes out-of-state ownership is probably not a factor in local sponsorships. In fact, Pepsi has become more aggressive in seeking sponsorships since Delta Beverage Group in Memphis bought out Mid-South Bottlers in Longview, Texas.

"We're now in the running for all the special promotion events simply because we're under new owners," Jones reports. "We have more of a free hand and flexibility in sponsoring things."

Linda Teer, executive director of Big Brothers/Big Sisters, praises the efforts of Pepsi in sponsoring the Bowl For Kids Sake program and points out that the company approached the local chapter about starting the fundraiser.

However, Teer feels that was the exception rather than the rule and insists that the location of the corporate HQ can be a factor in charitable endeavors.

"In general, getting local support from an out-of-state owner is extremely difficult, especially if the companies are franchises that are not a part of the national company," she observes.

As an example, Teer mentions Arby's, which is "very active with Big Brothers/Big Sisters nationally, but whose Little Rock locations are owned by a Tulsa business that won't even talk to us."

Given the level of competition between the soft drink giants, it's not likely that Coke and Pepsi will allow any such opportunities to pass by. Pepsi exploited some openings presented by the change of ownership at Coke this year. The company is likely to make some countermoves next year and not let the Pepsi challenge go uncontested.

Dana Steward, a free-lance writer living in Little Rock, contributed to this article.

PHOTO : FAST-BREAK OPPORTUNITY: When Coke was unresponsive to the HoopFest organizers, Pepsi took the sponsorship ball and ran with it.

PHOTO : CORPORATE COUNTERMOVES: The Coca-Cola Bottling Co. of Arkansas isn't likely to let the Pepsi challenge go uncontested next year. Even with the inroads made by its soft drink competitor in 1990, Coke is still the dominant force in sponsoring special events like Pops On The River.
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Title Annotation:Pepsi-Cola Co., Coca-Cola Bottling Company of Arkansas
Author:Waldon, George
Publication:Arkansas Business
Date:May 7, 1990
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