Coca-Cola taps Heyer power

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Less than three months after joining Coca-Cola Co. from president of AOL Time Warner's Turner Broadcasting System, Steven J. Heyer is poised to take over the highest marketing position at the soft drink giant.

Although initially charged with identifying and developing new business opportunities as president-new ventures, Mr. Heyer now is slated to expand his responsibility to setting global marketing direction for all Coca-Cola brands, according to several executives close to the company. In addition, he will oversee all aspects, including profit and loss, over noncarbonated beverages. Mr. Heyer did not respond to an e-mail or phone messages May 18 for comment.

The move leaves the fate of Chief Marketing Officer Stephen C. Jones in limbo. Mr. Jones, whose charge was to dismantle central marketing apparatus in favor of a "think local, act local" initiative, could vacate his position within three weeks, said insiders who suggest Coca-Cola wants to find the well-regarded Mr. Jones a home within the beverage giant.

The decentralization, which shifted decisions to the company's regional hubs rather than concentrating them at Coke's Atlanta headquarters, was implemented at the behest of Chairman-CEO Douglas Daft. It was Mr. Daft who tapped Mr. Jones to become chief marketing officer in January 2000, from president-CEO at Coca-Cola's Minute Maid Co. unit.

"You could argue that a chief marketing officer [with no] central marketing [structure] is redundant," said a former Coca-Cola executive.

As such, Mr. Jones' position is not expected to be replaced in its current form.

"He's in a no-win situation. He's been told to deconstruct global marketing, and he's being held accountable for not having a good global marketing strategy," a second former executive said. "As long as Doug Daft believes there is no role for global marketing, there is no role for Steve Jones."

Mr. Jones was on an international flight May 18 and could not be reached for comment; a Coca-Cola spokesman denied shifts were under way for either Mr. Jones or Mr. Heyer.

One executive close to the situation said Mr. Heyer is eager to install his own team to handle marketing, in part because he was underwhelmed with the flagship's "Life Tastes Good" campaign that broke in April. Interpublic Group of Cos., led by McCann-Erickson Worldwide, New York, created that effort. Interpublic was named global marketing strategist for Coca-Cola's $900 million account in December. Coca-Cola's other agencies include Wieden & Kennedy, Portland, Ore.; Interpublic's Lowe Lintas & Partners, New York; Cliff Freeman & Partners, New York and Berlin Cameron & Partners, New York.

By the end of the year, Mr. Daft is expected to name a president to be his No. 2, a position vacated in March with the departure of Jack Stahl, a 20-year company veteran who held the presidency for about a year and a half. Jeff Dunn, head of the Americas; Charles Frenette, head of Europe; and Sandy Allen, head of the Asia Pacific group, are said to be among the candidates. Mr. Heyer also would be on the short list, although those veterans are believed to have an edge, an executive said. If one of the regional heads were tapped, that could leave an opening for Mr. Jones.

It's uncertain what job Mr. Jones, who has an excellent relationship with Mr. Daft and is well regarded for his marketing, strategy and creative prowess, would keep within the company. He might lead one of the three worldwide regions, or he could become a division head-reporting to one of those presidents, insiders speculated. A third executive close to the situation suggested Mr. Jones may become a top aide to Mr. Daft. The two had worked together in Japan.

Sanford Bernstein analyst Bill Pecoriello said a 2002 management shift would make more sense than one now and would be surprising, coming so soon after massive layoffs and a management exodus. "It would be a destabilizing event," he said, adding that the company "is just stabilizing given the significant change in strategy and amount of churn in that marketing department over the last year."

Mr. Daft and top managers clearly are under pressure to boost sales, profits and share price, which last week hovered at $48-25% off its 52-week high and far below its 1998 peak. "As the world's leader in that category, they should be leading the industry in performance, not following it," the second former executive said.

Contributing: Wayne Friedman and Kate MacArthur

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