Sergio Zyman, Part 1: “The First Chief Marketing Officer”

A History of Marketing / Episode 10 (Part 1)

“Marketing is about selling more stuff to more people more often for more money more efficiently. That's what marketing is.” - Sergio ZymanThis week, I’m joined by a marketing iconoclast: Sergio Zyman. Wikipedia describes Zyman as being “best known as the marketer behind the failed launch of New Coke and the success of Diet Coke, Fruitopia, Surge, and ad campaigns such as "Coke Is It."

Zyman rarely gives interviews, and the few that are available tend to focus on the New Coke saga, which is frequently described as one of the biggest marketing blunders of all time. But New Coke is only a brief, and frankly misleading, snapshot of Zyman’s career full of marketing milestones.

This is the first of my two-part interview with Zyman. This conversation explores his unlikely journey from Mexico City to the C-Suite of the Fortune 100, with stops at Procter & Gamble, McCann Erickson, assignments in Japan (working on Nescafe and General Motors), and even becoming president of Pepsi in Brazil by age 30.

Ultimately, Zyman's path led him to Coca-Cola, where he launched iconic brands like Diet Coke and Cherry Coke...and yes, New Coke.

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He was eventually named Coca-Cola's first Chief Marketing Officer – and, according to Zyman himself, the first CMO in history, period. I've tried to verify this claim, and so far, I haven't found anyone holding that title before him. (Listeners, if you have evidence to the contrary, please reach out!)

In part one, we focus on Zyman's incredible rise. I’ve included the transcript below, but I recommend listening if you can to hear it in Zyman’s own voice. He's brimming with personality – too much to contain in a single episode.

Joining P&G’s "Cult-Like" Brand Management

Andrew Mitrak: Sergio Zyman, welcome to A History of Marketing.

Sergio Zyman: Hey, how are you?

Andrew Mitrak: Great. So, you've had a legendary career in marketing, but I want to start at the very beginning. You were born in Mexico City. I'm curious, what are your earliest memories of marketing and advertising when you grew up in Mexico City?

Sergio Zyman: You know, I wanted to get out of Mexico. Pretty much my family was in the clothing business and stuff like that, and I had no interest. I went to school in Europe. I traveled around the world a lot. And then I joined Proctor, you know, through a variety of coincidences.

And then I worked for Proctor in marketing, which at the time was kind of almost like a cult. And then from there, I went into the ad agency, and then on and on – I traveled around the world, lived in Japan, lived in Brazil, and so forth.

Andrew Mitrak: Procter & Gamble is legendary for implementing the principles of modern brand management. What was joining Procter & Gamble in their marketing department like? You said it was almost like a cult. What was it that made it cult-like?

Sergio Zyman: Well, most of the people that worked at Proctor in Mexico were either sons or daughters of expats, and primarily sons. They were primarily guys. And, you know, we joined as a staff assistant. There was a very orderly progression. Then, after a while, they sent you to sales training, which everybody hated.

It was a locked wing of the company. It was basically housed across the street from the agency. And marketing was about managing products – well, not managing products, but managing brands or launching brands. It was a lot of advertising and, you know, a lot of promotions and stuff like that.

Marketing Ariel to Transform Laundry in Mexico

Sergio Zyman: I was part of the team that actually introduced a brand called Ariel, which eventually became the largest brand in the world for Proctor. It was an enzyme detergent. I'm going to date myself many times here through this interview, but in Mexico at the time, people used to wash clothes on a stone with a bar of soap.

Then, after that, there was a product that Proctor introduced in Mexico called Rapido. The whole premise was that you could actually speed up – rapido means "quick" – you could actually speed up the process of washing your clothes. From then on, we wanted to launch a product like Gain in the US. And, I can't remember who came up with it, but the idea was that Ariel made every bucket a washing machine. We had this visual where you put the detergent into the bucket and the bucket would start moving like a washing machine. It was a huge success.

Andrew Mitrak: I want to quote from your book about Ariel and Procter & Gamble.

"So P&G had just introduced a detergent called Ariel, and the challenge was to convince skeptical Mexican housewives, most of whom did their washing by hand and didn't own a washing machine, that a packaged detergent could get the family's clothes as clean as whatever product they were currently using."

So, you're a young man, earlier in your career. How do you research skeptical Mexican housewives? How do you know what will persuade them, or what the real challenge is to be solved with this?

Sergio Zyman: Well, I think it was more about barriers than anything else. Research was very rudimentary. I don't even think that we used – I mean, we probably used some form of focus group at the time or something – but it was observational. You'd actually go look at the market, and every building on top had a place where it has a stone with little indentations in it.

All you needed to know was how the product was being used, right? And I think that was the genesis of a lot of the products at Proctor at the time. The positioning of Safeguard was that it eliminated bacteria, right? But there was really no big piece of research. We just hit onto something that was – I mean, it was probably when we asked people, "Why don't you buy a packaged detergent?" they would tell you that. And I think that's how we ended up getting into that. But it was very rudimentary.

Andrew Mitrak: Now, Procter and Gamble was your first job in marketing. Did you know that you wanted to be a marketer before you joined them, or did you kind of just fall into it once you came to this job at Procter & Gamble?

Sergio Zyman: My number one objective was to get an American Express card. And you needed to have an X amount of money, which was $200 less per year than what Proctor was paying. So, when I was looking around trying to get a job – I had actually, before that, become the major coordinator for the Miss Mexico contest. And that's how I met some of the Proctor guys.

So, I didn't have a real career vision. I wanted to make some money. I knew I wanted to get out of Mexico. I wanted to work for an American company because, usually, American companies worked Monday to Friday, not Monday to Saturday, which is what Mexican companies did. So, there were a lot of criteria there that were kind of dumb, if you wish.

And I met with a guy called Al Frost. My English was broken, even worse than today. And he asked me at one point during the interview, "What do you want to do when you grow up?" And I said, "I don't know. I just want to have the power of knowledge to be able to make the decisions that I have to make down the road." And he fell in love with that thought and hired me.

And that's how I got into Proctor. I really did not fit the Proctor criteria for being hired. I didn't go to school in the US at the time, didn't have parents that were expats in Mexico, my English was so-so – but that's how I got in.

When I got hired by McCann Erickson to go work on the Coke business, I remember sitting in my very first meeting at McCann and they were doing media planning, and I sat there in panic and I said, "I don't know anything about marketing. I don't even know what marketing is. These people are talking about something totally different."

Marketing became advertising. That's what marketing was. And I guess for a lot of companies today, still, marketing is advertising. It's not real marketing. It's not linked to the bottom line.

McCann Erickson & the Coca-Cola Account

Andrew Mitrak: You mentioned you moved from Procter & Gamble to McCann Erickson. And for listeners who aren't familiar with McCann, they're a major advertising agency. I think they had been the agency of record for Coca-Cola since the 1950s. And for those who've seen the show Mad Men, this is the agency that swallows and absorbs Sterling Cooper at the end of the series. So what led you to McCann Erickson? Why did you join after Procter and Gamble?

Sergio Zyman: Money.

The natural progression – I mean, I know it was more romantic – but the natural progression at Proctor is you were at Proctor, and then after about seven or eight months of just basically sitting around doing shipment analysis, they sent you to sales. They gave you the worst car that the sales department had and they sent you over to sell soap into public markets and little mom-and-pop shops.

And, I did that, and everybody hated it, and I figured I was going to do a good job. I ended up winning the contest, the three and a half months that I was there. And I ended up getting hated by all the Proctor guys, the marketing guys, because everybody didn't want to do well in sales.

I came back and then I became an assistant brand manager. And then I started getting offers. The natural progression was that we were the source of, quote-unquote, "marketing people." So I got a job from Kimberly Clark, and then McCann – I had met the guy at McCann during the Miss Mexico thing. And I liked them a lot, and I went to be an account executive on the Coke business, which was sexy. And that's why – and it paid me double my salary.

Andrew Mitrak: That's a good reason to move on and move upward.

Sergio Zyman: It is.

Andrew Mitrak: So what was the culture of McCann like – this is probably the mid-70s or so, right? So what was their company culture like?

Sergio Zyman: The Coke relationship was very difficult because it was imposed by Atlanta. So, pretty much, you couldn't go and choose your own ad agency. It was McCann or else. And the guys at Coke had come from sales. Most of the guys that were in “marketing” – VP of Marketing or Marketing Director role at Coke was a sales guy.

It was about dealing with bottlers and stuff like that, and there was always an antagonistic relationship.

"Pattern Advertising" and Challenging the Status Quo of Marketing at Coca-Cola

Sergio Zyman: We adapted advertising that was created in Atlanta. It was called "pattern advertising." And we did a good job with it, but there was always tension between us and the Coke guys. It was not a happy relationship. It was just to do what you needed to do.

Andrew Mitrak: Yeah.

Sergio Zyman: I was thinking about this interview. And, you know, when did marketing come to these companies? If you go back and you look at fast food, Wendy's head of marketing was a guy called Bill Welter. The marketing guy at McDonald's was Paul Schrage. I don't know who the marketing guy at Burger King was, but pretty much what happened to these companies as they started opening up more stores, they realized that they needed to communicate with the consumer and explain to them why they should go and buy their stuff, right?

There was not a lot of competition. And the powers that be in these companies, whenever they wanted a marketing guy, they said, "Wow, I think that we better get it out of the agency." So it was the ad agency guy. Welter was the ad agency guy. And so was the guy at Burger King.

So that's where the guy at Coke who was the head of marketing at the time, Ike Herbert, was a McCann guy. So it was all about advertising. Advertising actually dominated the marketing function in a lot of companies. It wasn't about truly doing marketing the way we knew it. And I always felt very uncomfortable about it. I didn't want to be an ad guy. I thought that it was not a great label for me. I was not a businessman. So that's kind of where my formation as the challenger of the marketing function began.

Coca-Cola’s “Hilltop” Ad: An Accidental Classic

Andrew Mitrak: I want to ask you about your impression of the ads that were created for Coca-Cola because McCann, of course, they had created the famous Coca-Cola hilltop commercial with the jingle "Buy the World a Coke," and it really is an incredible commercial and it's one of the most famous advertisements in history.

But Coca-Cola almost became kind of a victim of this ad's success, and ads like it, where they internalized this – happy, smiley people with a Coca-Cola bottle in their hand – and this was the formula for them. And it sounds like you were questioning, "Was this actually driving sales? Was this actually working at the end of the day?"

Sergio Zyman: Well, look, I think that there is a lot of mythology about advertising, and about advertising for Coke. So, there was a guy at McCann called Bill Backer, who eventually left and went and built Backer Spielvogel. And he was a really creative, artistic guy. And there was a music guy there called Billy – my God, I just forgot his last name. And Billy had actually sung with the Four Tops before he became the music director for McCann.

They were going to do a radio spot called "I'd Like to Buy the World a Coke" and they wanted to do it – they went to record it in London, because that's how you did buyouts. And the commercial became an accident. It had no strategy behind it. And then everybody fell in love with it. And Coke sales kept on going south for a long time because Pepsi was really the marketing director for Coke. Pepsi was determining the dialogue; Coke wasn't.

Andrew Mitrak: Yeah. I just looked it up, by the way – it must be Billy Davis.

Sergio Zyman: Billy Davis, exactly.

Andrew Mitrak: That's it. Okay.

Sergio Zyman: Billy. Yeah. Good guy.

Pepsi: “The marketing director for Coke”

Andrew Mitrak: You mentioned that Pepsi was really the marketing director for Coca-Cola. And I'm going to quote from your book again:

"This was the 1970s and Pepsi had just started with their 'new generation' approach. McCann's philosophy, which was the same as the rest of the industry, including Coke's, was 'grab their hearts and their wallets will follow.' So we kept coming up with ads that made people feel good, made them cry and won us awards."

It goes on to say that these ads didn't really seem to be working as far as new business and sales were going.

Sergio Zyman: Well, they were not.

Remember, in the old days, Pepsi was not a viable choice for people who drank soft drinks. By the way, we didn't have 10,000 different options. Okay, you had Coke and you had Pepsi, and then it was all done by manufacturing. Sprite was created in the UK in order to be able to actually fill the bottling lines because they weren't selling enough – there was no strategy behind it.

And Pepsi then decided, in order to – they said to get out of the kitchen and into the living room – that they needed to become a viable option to Coke. And they had a very good strategy because they started discounting in supermarkets, they started multi-packing. Coke just didn't believe in that. They believed that all they needed to be was this – "grab your hearts and their wallets will follow."

But Pepsi basically said – and they never said, "Coke sucks." What they said was, "Pepsi's for the new generation." And the implication was that Coke was for the old folks. So they called it the Pepsi Generation. There was a guy at Pepsi that was very smart about that, Alan Pottasch.

And then, after that, they did the Pepsi Challenge, where basically they said – by the way, they never said Pepsi tasted better. They just showed that people chose it. So they were always doing that stuff. And then when I became marketing director – and by the way, you can look at the quotes out there – I became, you know, Pepsi basically said that I snuck up on them because I said, "Enough!"

I hired Bill Cosby at the time to do a bunch of advertising to basically say, "There wouldn't be a challenger if there was not a number one." We launched Coke Is It, which was a very successful ad campaign. That, by the way, McCann took credit for, but it was developed in Canada for the Canadian market. So there are a lot of secrets along the way about how these things came about.

Andrew Mitrak: Yeah, we'll get to all of those stories, but I want to come back to while you were still at McCann – you said you're an account executive on the Coca-Cola account. And over time, I've become less impressed when someone comes up with a good idea and more impressed when someone can convince their client to get behind the good idea. And that's kind of the role of the account executive in a lot of ways, right?

Sergio Zyman: Well, Coke had this thing, as I mentioned before, called "pattern advertising." So they developed a series of commercials. They did "Have a Coke and a Smile." They did, at the time, "It's the Real Thing," right? The advertising is the real thing. I mean, it was shot down to everybody around the world. Our job at the agency was to translate it and adapt it. And then we had to go and sell it to the client.

But we were not coming up with a lot of original marketing ideas to grow volume. It was all about – we were implementing whatever was coming down from the north. And even at headquarters, and later on when I was at headquarters, it was kind of – the agency drove and dominated the whole communication or marketing thing. The Coke marketing folks were ex-salesmen. There was no strategy.

Coke was a distribution company. They had a great product and a great idea, and then they developed a distribution network around the world. There were a lot of people that wanted a franchise, and that's how they ended up growing for a long time. At one point, they actually needed to go vertical, and that's when the company started changing. But it was all about launching bigger bottles, or different sizes, or plastic bottles, or stuff like that. You didn't really have a real marketing strategy coming out of the company.

There was a group at McCann who went off into this quiet lab, and they'd come in and they'd make a presentation about how we're going to go to the next level. And we had this stupid piece of research, which was "13 elements of imagery." And it was about, "How much do the consumers love us?" Not how much do the consumers buy us, but how much they love us. And, you know, it was very frustrating.

International Marketing: From Japan to New York to Brazil

Andrew Mitrak: You were at McCann and eventually, of course, you went to have a very successful career at Coca-Cola. But before that, you actually joined Pepsi, their top competitor, in Brazil, right?

Sergio Zyman: No, so I went to McCann in Mexico, and I saw Gene Kummel, who was the president of McCann, came to visit in Mexico. And I got a call – the president of the Mexican company called me up at McCann and said, "By the way, Jean is here. Would you like to see him?" And I said, "Yeah, great." Or, "He'd like to see you."

So I went down to meet Jean. And he said, "What do you want to do?" And I said, "I want to go international. I want to get out of Mexico." I told him all the reasons, and three months later I got a call that said I was transferring to Japan. And I said, "Japan? Why Japan?" And they said, "Because if you can make it in Japan, you can make it anywhere."

So I went to Japan as an account executive again, to work on the GM business. They had bought Isuzu in Japan, and they were trying to create a pattern model for advertising around the world. And I also worked on Nestlé.

And in Japan, the Japanese are very methodical, as you know. And they were selling Nescafé, which was the number one brand for Nestlé around the world. But then when it came to the spring, the Japanese went and got a haircut, switched their suits from winter to summer, and stopped drinking coffee – just stopped. So we came up with a cold drink out there, and I worked on that. I was there for a year and a half – an incredible experience, living in Japan.

So then I got a call saying that they wanted me to go back to the States. I went to New York, and they offered me a job as account supervisor on the Coke New York – the bottler in New York. And I said, "You know what? I need to get the New York experience. I got to check that thing." So I took the job, and it was a nothing job. All we did was take the client to dinner. We didn't do anything meaningful.

Becoming President of Pepsi in Brazil at Age 30

And then Pepsi started asking me to join them, and they offered me like five or six jobs. They were all kind of ad jobs, and I didn't want to be in that. And then eventually, McCann – I went to Central America to be general manager of the Central American company. And then when I was there, they asked me whether I wanted to interview for a marketing job in Brazil.

And I had just gotten married, my wife was pregnant. And I said, "You know what? Take a free trip to Brazil. What the hell? I don't think anything is going to come out of it." I went to Brazil, and the job actually was to develop an advertising campaign, even though I was a marketing guy. And I said, "Well, I can do that. I know how to do that."

So I took the job as head of marketing for Pepsi Brazil, and we moved to Brazil, which was a great experience. My daughter was born there. We lived there for three and a half years. About two years in, my boss gets transferred to Venezuela, and I get promoted, at age 30, to be President of the company. And I was over my head – beyond anything. I didn't know what I was doing.

The Pepsi Challenge: Growing Pepsi’s Marketshare vs. Coke

Andrew Mitrak: In your book, you write,

"When I got there, I found out that Pepsi Brazil had the same advertising philosophy as Coke, but to make things worse, Coke was outselling us there 10 to one. Not good. I knew that with the odds so heavily against us, and with comparatively no penetration in the market, the only way we could dig ourselves out would be an ad campaign that provided a contrast between us and Coke. So we came up with the Pepsi Challenge."

And I'm wondering, what were the origins of the Pepsi Challenge? You were at Pepsi when the Pepsi Challenge was launched. What did the rollout of that look like? How did that start?

Sergio Zyman: Pepsi was doing some spectacular advertising with the puppies and the "Pepsi Generation" – great jingles and all that. And there was an agency in Dallas, Texas, that came up with the Pepsi Challenge. And in the old days, you didn't go negative, right? I mean, you basically came out and told people why you were the right candidate or the right product, but you never went negative. The only time you went negative is when you had nothing to say.

And Pepsi had tried everything to get out of the kitchen and into the living room. And all they were trying to find was a way to be equally considered by consumers. In Brazil, I had no money. I had no budget. And, you know, I didn't come up with the Pepsi Challenge. It came out of Dallas. But then we started doing it in Brazil. It didn't go as well as it went in the States because, in Brazil, people frowned at negative advertising. But all that changed over the years.

Andrew Mitrak: At a tactical level in Brazil, when you're doing this, was it pop-ups in supermarkets and public areas where people could try them both? Were you filming these and putting them on TV? What were the mechanics of the advertising campaign rollout look like there?

Sergio Zyman: We basically did taste tests, right? Blind taste tests. And you did a not-blind taste test until you won. The moment you won, you stopped. You didn't have to do any more. So you kept on filming these very rudimentary spots. And then once you got to the number where you could claim that more people prefer the taste of Pepsi to the taste of Coke, you didn't have to do any more.

Andrew Mitrak: If you ever lose, you can just stop that ad and not run that one.

Sergio Zyman: No, no, you don't. You never – you won't lose because the chances of a sweeter product, which is what Pepsi was... Eventually, you didn't have to win by a large margin. You could win. All you needed to do is have 51%. "More people prefer the taste…" – all you needed to say. "In taste tests in Rio, more people prefer the taste of Pepsi to the taste of Coke." That's it.

Andrew Mitrak: Yeah.

Sergio Zyman: And I would do things like, when we would launch a new flavor or something, I would take all the trucks and I would do a parade through the cities of Rio or São Paulo, as a way to do that. I didn't have any money. And I learned a lot.

And then they decided to restructure Pepsi down in South America. They put together a group with Bolivia, Argentina, and everything else, and they brought in a guy called Roger Enrico. And Roger arrived in Brazil, and – the flight arrived at 5 o'clock in the morning. I sent a car and a driver and a letter saying, "Welcome to Brazil. I'm at your service. Let me know – I'm sure you want to rest." He got all offended about it. Hated me from day one. He came into the office; he wanted to take my office because he was now the guy for South America.

Anyway, so he fired me a year later. So now I am in Brazil with my wife. She's pregnant with my second kid, and I'm fired. So I said to my wife, "We're going back to Mexico." She said, "I don't want to go back to Mexico." I said, "Guess what? That's the place that I can actually retool and figure out what I'm going to do."

But then John Sculley, who was president of Pepsi North America, heard what happened, and he said, "We're not losing Sergio." So they moved me to New York against Roger's desires, and then I went to be director of marketing for Brand Pepsi in New York. But it was a nothing job, too, because it was all about advertising.

Andrew Mitrak: I've got to ask you about – you mentioned John Sculley, of course, later became CEO of Apple. Did you work with John Sculley, and what were your impressions of him?

Sergio Zyman: John was an incredibly cerebral guy. Very introverted. And I worked with him, and I worked with “Ted” Glover, who had then moved to New York as well.

And then I got a call from Brian Dyson, who I had competed against in Brazil, and he said, "By the way, I'm back in the States. I'm running Coke North America. Do you want to have lunch next time I'm in New York?" I said, "Sure." And we went to have lunch at the Bar Americain at the Waldorf. And then as we were sitting having lunch, suddenly Don Keough, who was the president of North America, by accident, shows up at the window and waves at Brian. He comes in, sits down, and pretty much starts grilling me about what I thought about Coke.

And I said, "I think you guys are screwed up. I think you've had so many advantages, and you're just giving more up." And I gave him a bunch of examples. And he said, "Well, we're not that bad." I said, "By the way, I'm not here – I'm just having lunch with Brian." I didn't even think that they were interviewing me. And then later on, Brian offered me a job to go down to Atlanta, and I went down to Atlanta. I got an offer – a very good job – and then from then on, lots of stories.

Andrew Mitrak: Lots of stories. So, you joined Coca-Cola in 1979. To quote your book, you say,

"That's when I found out exactly what happened after those ads I'd worked on at McCann were sent off to the media and aired 20,000 gazillion times, and I was shocked. Nothing happened. All those beautiful, heart-grabbing, award-winning ads that were supposed to be getting people to buy Coke weren't having much of an effect."

So, was this really the time when you learned that the advertising wasn't really working at all, once you had moved in-house at Coca-Cola?

Sergio Zyman: Yes. I mean, there was – Coke was really – I found out when I got hired, the reason they hired me was to pick up the secrets from Pepsi. And they really didn't treat me well when I got there. It was kind of almost like a joke. I was the token Pepsi guy and kind of a spy. And Coke was such a fraternal, "belonging-only," non-performing company.

And all of a sudden, I started doing things which were so bad – like, I went down to lunch one day, and I'm an avid runner, and I was running a lot. And the only thing they had in the cafeteria was chili dogs and really fat stuff. So I convinced them to put in a salad bar. And I became like this terrible person. They'd scratch my car in the parking lot. It was awful.

Andrew Mitrak: Do you think that you being from Mexico had something to do with that? Do you think it was prejudice?

Sergio Zyman: No question. For sure. But, for me, being Mexican was kind of – I knew that I was in the minority. I knew that people didn't see me correctly. Even at McCann in New York, my own friends in New York were always kind of saying, "Why do we need a Mexican guy to be in New York?" There was always discrimination, but I just took it as part of the course. I had to work through it.

But the advertising was very garbage at Coke, and it was managed by a whole different group, kind of corporately. You were not allowed to touch anything, do anything. I remember when, after a while, there were all kinds of people who left, and I was named director of marketing for the US. And I tried to hire people, and I had a couple of marketing people from Procter and other places.

I remember there was a guy called Richard Ternowski, and he came to see me one day and he said, "Look, I tried to talk to the product guys about what's going on with the product, and they said I'm not allowed because that's a corporate thing. I tried to talk to advertising, to this guy John Gillen, who is kind of a protégé of the president and the son of a cousin, and I'm not allowed to talk about advertising. The packaging is done by corporate, and I'm not – what am I doing here?"

That was the issue. So, the thing that – I started then becoming the guy that would come up with challenges. "How do we break this? What do we do in order to do something totally different?" We wanted to sponsor Hands Across America, and we did all kinds of things that were stupid in today's world.

But then the thing kept on growing that way. Eventually, I became the head of marketing for North America. I ended up being the project manager on Diet Coke. It got canceled twice. And I did New Coke and Diet Coke and things like that, but it was so hard. It was really hard. It was counter-cultural.

Launching Diet Coke: “Just for the taste of it”

Andrew Mitrak: I want to ask you a little bit about some of these launches during this period. Can you share the story of Diet Coke? You kind of take it for granted that Diet Coke is one of the options today, but it didn't exist until you were there and really oversaw some of the launch of that. So how did that go?

Sergio Zyman: Remember, I was Attila the Hun. I was there to destroy the status quo. So anytime Brian would call me up and say, "What do we do now?" I would come in with these cannonball things. Tab had a 3% share. Pepsi had two brands, Pepsi Light and Diet Pepsi. Together they had 4.1%. Anything that we did to grow Tab was just tough because Tab had been positioned as a diet drink. And the number one benefit of Tab was that it tasted sh****. Because of – I mean, it had saccharin, right? So people saw it as a way to punish themselves so they could go in and have three hamburgers.

When I started the project initially, I started doing a lot of work on it with only two guys. I was actually semi-being the executive assistant to the president of the company as well. We went to Brazil – we were in Brazil. That's the time that Paul Austin, who was the chairman at the time, they discovered he had Alzheimer's, and there was a change in management. And then we got an email saying, "Stop all work on Diet Coke." And then the project got canceled.

They had agreed with me that I was going to go to Harvard for the 13-week post-grad. And then I was leaving. So I was going to go to Harvard. Then Roberto Goizueta gets named CEO of the company. The project gets reinstated, becomes "Project Harvard," and I said, "I want to have a different ad agency." And they said, "Okay." Literally, after that meeting, I went to the airport, I went to New York, and I hired Lintas before McCann had a chance to react. And of course, that made me persona non grata. Remember, at the time, Madison Avenue saw me as destructive. I mean, they named me the “Aya-Cola.”

Andrew Mitrak: So, Aya-Cola being a pun on Ayatollah, right?

Sergio Zyman: Right. Exactly. And my view about it at the time was advertising needs to sell product. And they're saying, "No, no, no, no. Advertising needs to do these great commercials and entertain people. Look at the success of “Mean Joe Greene” and 'I'd Like to Buy the World a Coke,' and blah, blah, blah." And I just – I mean, we got into a massive fight for years about it. And I still believe today that the thing is all broken.

But I just kept on going about it. And then, I got introduced to Goizueta, and I said, "Sir, I'm going to go away. And if I come back with a proposition to you, you're going to have no choice but to approve it. Because it's going to be an unassailable proposition." We walked out of the meeting, and Keough says, "You almost got fired there by talking like that to the chairman." I said, "What did I do? All I said was I wasn't going to just go play with this thing, that if I found out that there was no viability for the project…"

So we went and we hired a design company – a very – I mean, I went non-traditional on everything. And we hired this guy, Alvin Schechter, who was really smart. He had done a lot of industrial stuff. I wanted somebody that had not done consumer products. That was – every time I tried to kind of do it sideways.

And in one of the meetings, he was talking about the fact that the thinness of the lines on the Diet Coke can had to be enough to have the equity of brand Coke on it. And I was kind of rolling my eyes, and suddenly I said, "Wait a minute. We cannot launch a diet drink. We need to launch a regular drink with no calories." And everybody looked at me like an idiot.

"Wait a minute. We cannot launch a diet drink… We need to launch a regular drink with no calories."

And I said, "It has to have all the imagery" because a brand is made up of five components of imagery: product imagery, user imagery, brand imagery, usage imagery, and trademark imagery. So eventually, making a long story short, we ended up with a product that was sweetened with saccharin initially. But basically, we launched it on a platform of taste, with a big jingle. Say, "You want to drink it just for the taste of it." And we launched it in Radio City Music Hall with the Rockettes.

So that's how we got around the thing. And that's – I left. I went to Harvard, and then they, kind of corporate, took over the product. They tried to launch it around the world, and it failed miserably everywhere around the world. And the reason for that is because they were launching it as a diet drink. When I came back to the company, I just changed the nomenclature from Diet Coke to Coke Light, and volume went through the roof. And that's – I mean, Diet Coke, there's a lot of stories behind Diet Coke and a lot of insight about it. Same story with New Coke.

Sergio Zyman: “I was the first-ever Chief Marketing Officer…”

Andrew Mitrak: Yeah, there's a lot of stories, and we're at time for our interview today. We're going to do a follow-up because we've covered a lot of your career – from Mexico to Japan to the US, to Brazil, back to New York and Atlanta. But we're still… there's decades and decades of the rest of your career. I want to talk about Tab Clear and the takedown of Crystal Pepsi, of course, New Coke, the founding of the Zyman Group, your advising to politicians on political campaigns, also some of your consulting work with Microsoft. Just so many stories to keep going through your career. So I'm going to follow up with you and we'll schedule part two of this conversation.

Sergio Zyman: Well, let me finish with one comment only. Remember, my philosophy is marketing. And I learned it over the years. Marketing is about selling more stuff to more people, more often, for more money, more efficiently. That's what marketing is, right?

Marketing is about selling more stuff to more people, more often, for more money, more efficiently.

And it's not just a moniker. It's selling more stuff, which is volume, or more money, which is profit, more efficiently, which is spending as little as you can. And then it's about penetration and usage. And I think that when we talk again, we've got to talk about those philosophies, which are still not embedded in companies today.

I was the first-ever Chief Marketing Officer, and the reason I became the Chief Marketing Officer – and we can talk about it as well – is because I wanted to have a seat at the table. Now, everybody's a Chief Marketing Officer. They're not. They don't have any responsibility for the bottom line. So we'll talk some more.

Andrew Mitrak: Absolutely. Well, I'm really looking forward to it, Sergio. Thanks so much for your time. This has been an absolute blast. I really enjoyed this conversation so much. So thank you again, and we'll talk again soon.

Sergio Zyman: All right. Take care.**End of Interview — Tune in Next week for Part 2.**

A Special Thanks

I want to extend a very special thank you to two people who were instrumental in making this interview happen: Mark Kroese and Joe Michaels. I'm incredibly fortunate to count them as mentors and as friends. They both independently recommended I speak with Sergio Zyman for the podcast, and their insights were invaluable as I researched and prepared for this interview. And it was Joe who actually put me in touch with Sergio, making this conversation possible. Thank you for your support, Mark and Joe!

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