Roberto C. Goizueta, the Cuban-born chemical engineer who helped put Coca-Cola in tiny villages and big cities the world over, making its red-and-white logo a global symbol of American style and affluence, died Oct. 18 in Atlanta. He was 65.
Goizueta, Coke's chairman and chief executive for the past 16 years, died of lung cancer in Atlanta. Goizueta, a heavy smoker, was diagnosed with the disease in September and had been receiving chemotherapy and radiation treatments at Emory University Hospital.
Goizueta (pronounced go-ZWET-a) engineered one of the most profitable expansions in the storied history of Coca-Cola Co., an Atlanta-based soft drink giant. During his tenure as chief executive, Coke's sales more than tripled and profits increased by sevenfold, to $3.5 billion last year. Millions of investors were richly rewarded: The value of the company's stock rose from $4 billion in 1981 to more than $145 billion now.
The rise also enriched Goizueta, who through stock options and grants by Coke's board became the first hired hand in history to become a billionaire.
The company's board was so enamored of his performance that in 1991 it asked him to remain chief executive indefinitely, past the company's usual retirement age of 65. In a move that was opposed by some stockholders, the company gave him stock valued at about $81 million as an inducement to stay.
Coca-Cola offices around the world will be closed Tuesday, a company spokesman said, the day Goizueta's funeral is scheduled to take place in an Atlanta church. A tribute service for employees is scheduled for Wednesday in Atlanta.
With fierce competition at home from PepsiCo Inc. and a handful of other soft drink companies, Goizueta tapped international markets for growth. Although already familiar in many foreign countries before his tenure, the Coke logo today is said to be the world's best-known symbol after the Christian cross.
Under his tenure, the share of the company's profit earned outside the United States grew from from 60 percent to 75 percent. Coca-Cola, Goizueta said several years ago, is "an international company that just happens to be based in Atlanta."
The son of a successful architect and grandson of a Cuban sugar-and-land magnate, Goizueta grew up privileged in Cuba. Upon graduating from Yale with a degree in chemical engineering, he resisted his father's offers to join the family construction business. Instead, he answered a blind want ad in the local newspaper for a bilingual chemist. The ad was placed by Coke, which hired Goizueta in its Havana operations in 1954.
He defected to the United States with his wife in 1960, just two months before Fidel Castro seized Coke's Cuban operations. At the time, the couple had only $40 and 100 shares of Coke stock, and lived in a Miami motel room with their three children.
"Perhaps no other corporate leader in modern times has so beautifully exemplified the American dream," former president Jimmy Carter told the Associated Press. "He believed that in America, all things are possible. He lived that dream."
Goizueta stayed with Coke, and moved up the corporate ladder rapidly in technical positions. Along the way, he picked up a key patron: Robert W. Woodruff, Coke's former chairman. With Woodruff's backing, Goizueta rose to the top executive ranks in the 1970s.
Many on Wall Street were surprised at his selection for the top post in 1981. At the time of his ascension, the soft drink company's sales and profits were flat and arch-rival Pepsi was gaining.
"There was major questioning, major uncertainty about Roberto," said Roy Burry, a stock analyst who follows the company for Oppenheimer & Co. "This is, after all, one of the world's major marketing organizations, and Goizueta didn't come from a marketing background. But it very soon became evident why this was done. Coke had become lethargic and they needed someone like Roberto to build a fire under them."
Some Coke watchers at the time perceived an undercurrent of racism in some of the criticism. After all, Coke was an old-line Southern company that had never had a non-Georgian at its helm; it was being run by a naturalized American with a foreign accent.
Undaunted, Goizueta moved quickly to revive the company. Out went Coke's friendly "Have a Coke and a Smile" ad campaign for the aggressive, almost confrontational "Coke Is It" campaign. Goizueta also steered Coke into the entertainment field, buying Columbia Pictures in 1982 (it dumped its stake seven years later, selling the studio to Sony Corp. for a big profit).
Another of Goizueta's bold early decisions was to downplay Tab -- a diet drink marketed primarily to women -- and introduce Diet Coke. The new product played off the flagship brand's strong name awareness, a somewhat heretical move for a company that had long held the Coke brand name sacrosanct.
In addition to the name, Diet Coke also benefited from good timing. It was introduced just as the artificial sweetener aspartame came into wide use; the ingredient improved the taste of diet drinks and set off a boom in that segment of the industry. Marketed with the slogan "Just for the Taste of It," Diet Coke became the leading diet drink, particularly among newly weight-conscious baby boomers, both male and female, who had grown up on regular Coke.
Even Coke's much-publicized "failure" with New Coke turned out to be a net gain in the long run.
To beat back market share gains by Pepsi, Coke in 1985 introduced a sweeter, smoother version of its 99-year-old main brand. But Coke reaped a tornado of reaction for tinkering with an American icon, and eventually was forced to return the "classic" formulation of the soda to the market.
That meant that Coke had regular and diet versions of both old and new Coke on store shelves, plus the reintroduced Cherry Coke. The proliferation of brands collectively helped the company improve its overall market share -- which was the idea behind the introduction of "new" Coke in the first place. To the idea that Coke had engineered the whole thing, Goizueta once quipped, "We're not that smart, and we're not that dumb."
Goizueta's moves to shore up Coke's distribution system had just as profound an effect on Coke's profits and stock performance. Until his ascension to chief executive, hundreds of independent bottlers and distributors around the world marketed Coke's various brands. The company's profitability was held back by long-term distribution contracts with these bottlers, and distribution could be spotty or nonexistent in some markets.
By restructuring the company's distribution network -- and by acquiring some of the bottlers outright -- Coke was able to gain more shelf space in more places. It also was able to raise wholesale prices for its all-important syrup and thus enhance its profits. "He woke up the distribution system," said Davenport Securities' John Maxwell, a longtime Coke analyst.
Analysts praised Goizueta's expansion of the company's brands in places such as China, India and Latin America (in Venezuela, Coke wooed away Pepsi's main bottler). It is now consolidating its global distribution network into the hands of a few huge bottlers, which the company calls its "anchor" distributors.
Goizueta's likely replacement at the company, industry analysts said, is M. Douglas Ivester, Coke's president and chief operating officer for the past three years, who had been running the company during Goizueta's illness.
© Copyright 1997 The Washington Post Company