Interesting. You use the free market as a reason for employers to be able to control what their employees consume.
So why does the free market not extend to consumers, and their freedom to drink the beverage of their choice?
Consumers are perfectly free to drink whatever beverage they wish. No one’s forcing the Coke driver to continue working at Coke – if he wants to drink Pepsi openly, he can work as a driver for Pepsi or some other soft drink maker, or as a driver outside of the soft drink industry entirely.
Choices have consequences. The Coke driver who drinks Pepsi in public risks getting fired. Coke risks alienating their employees and hurting morale by requiring them to only consume Coke products. Both Coke and the Coke driver have to weigh the costs of those consequences in making their choices. A free market does not mean a consequence-free environment.
DCH, thanks for the correction on the law firm situation.
Gary Kumquat, I would agree with you wholeheartedly if this incident occurred while the Coke driver was sitting at home on his day off watching a ball game. In that instance, Coke has no more authority over the man’s choice of beverage than I do.
But on company time, while you’re driving a company truck and wearing a company uniform, you bet your bippy Coke has a say in what you do.
For what it’s worth, at one time Coke considered their delivery people to be some of their most important employees. (I don’t know if that’s still the case, so the following anecdote may not apply any longer.) A friend of mine wanted to go to work for Coke as a delivery person. This would have been around 1989 or so. She’d heard that Coke’s benefits were great, and she liked the company. When she applied, Coke told her that there was a two-year waiting list to be interviewed for that job, with no guarantee she’d actually get hired. Coke placed a premium on their delivery force as an important cog in their overall marketing strategy, and as a result they paid them very well and gave them a lot of freedom.
As I said, I don’t know if that’s still the case. But viewed in that light, you can see how blasphemous it must appear to Coke to have a driver drinking Pepsi.
Sorry, but the above has little to do with a free market. For example, one of the requirements of a free market is:
The moment you start introducing such artificial constraints and limits as the example of a manufacturer controlling what their staff buy, you are inherently and blatantly manipulating demand.
I am honestly curious as to how anyone can find this behaviour even remotely justifiable.
I still find the premise that a picture of a Coke employee drinking Pepsi, or vice-versa, has even the slightest effect on anyone’s drinking habits very difficult to accept. The example of cable company employee opting for a different means of receiving signal isn’t a good analogy IMHO because there are, presumably, measurable differences between the two products, and his choice thus demonstrates the technical superiority of the second solution. Between Coke and Pepsi however, the only difference is personal taste - they are, after all, both coloured, carbonated sugar water. If I find out that someone who happens to work for Coke prefers the taste of Pepsi, I don’t see it as “expert” testimony that Pepsi is a better drink. Nor can I bring myself to believe that anyone else changes their personal tastes as a result of such a photo. Nor do I believe that the company to whom this guy was delivering is now planning to restock with Pepsi. For all the branding and marketing that both these companies indulge in, they can’t make people keep drinking their product if they don’t like it. So to claim that business suffered demonstrably as a result of this guy’s actions - to suggest that they lost even one sale, let alone enough to justify the cost of the firing and hiring procedure - strikes me as being more than a little far-fetched.
You have no idea of how seriously the folks at Coke and Pepsi take themselves. Right now, the Pepsi guys are laughing their ass off because they’re getting tons of free publicity off this, while Coke’s looking like “The Evil Empire.” Nevermind that most folks couldn’t tell the difference between these two concoctions if it weren’t for the billions in ad dollars and fancy packaging on the containers, the folks at Pepsi and Coke are deadly serious when it comes to this stuff. According to a former Pepsi rep, if he were to go into a place that only served Pepsi, order a Coke, and the waitperson didn’t recite a precisely worded statement about how they only served Pepsi, he could slap the establishment with a fine.
Worse than that, I would find it far more likely they will lose sales through negative publicity on their handling of this situation.
I really just can’t find a level where this isn’t impressively stupid behaviour as a business decision.
In this case, we’re talking about the labor market. Coca-Cola is a buyer of labor. Employees and job applicants are sellers of labor.
If a person doesn’t like the conditions Coca-Cola puts on employment, that person is free to decline to sell his or her labor to Coca-Cola.
If Coca-Cola’s rules cost them more in terms of employee morale and in terms of other employee compensation than it gains them in terms of marketing advantage (or, more accurately, marketing disadvantage vis-a-vis their competitors), then Coca-Cola will find itself at a disadvantage in the marketplace and will suffer accordingly.
For a company like Coke, the brand is everything. The policy exists not so much because a Coke driver drinking a Pepsi will cost the company sales, but because it might dilute the value of the brand in the minds of the people who see it. Coke will zealously guard its brand value from even marginal dilution because that is the principal asset of the company.
I found this thread pretty interesting, because its topic suits the current political discussions here - many EU countries have pretty tough restrictions providing the conditions under which an employer may fire an employee, and several national governments are planning to loosen those regulations, against resistance from the unions. Personally, I think the employer has some right to protect the brand value, but OTOH the employee of course has the right to drink what he wants. It’s difficult to decide which ones of those two opposing rights is more worth to be protected by the society as a whole, but I think it’s the employee’s right, so I’d say the termination should be void. Not to speak about the irrationality of this - the media coverage on this has damaged Coca-Cola’s image much more than the guy’s taste would ever do.
Maybe it’s time for a détente in the Cola Wars. Coke allows its employees to drink Pepsi, Pepsi allows its to drink Coke, and the effects will kind of cancel out each other. After all, everybody knows Pepsi employees don’t drink anything but Pepsi because the drink is so great - they just have to drink it, and consumers seem to exactly know about that.
Also understand that this type of behavior is not limited to soft drink companies.
The company I work for has rules around what companies you can invest in. How is that not infringing on the free market? Doesn’t that affect demand for certain stocks?
Also, it used to be the case that you were pressured not to frequent certain places (bars, liquor stores) in the same dress as you went to work, because you were representing the company, even in your free time.
DCH re: working for a law firm. I would also think that privacy might influence someone to seek counsel outside of their work place.
I work for The Limited. I work in the technical area so I may work for any number of different brands. Right now I am primarily attached to Express. I know for a fact that Express store employees better wear Express brand clothes or they will not last long. Of course they are entitled to deep discounts, and for the most part, the people that want to work in the stores like the brand and like the clothes. Mine is not a public position, but even in the office environment, there is an impetus for certain levels of employee to be “brand” correct.
I personally usually buy my clothes at Meyer. I am neither an avid or eager shopper. I don’t like to try on clothes in stores. I find my size and go (has anyone else noticed that size 34 waists are getting smaller?). I’m sure I could do much better for my wardrobe if I did shop at more “brand” stores, but I don’t feel the effort is worth it. Next week I will start a project for VSD, Victoria’s Secret Direct (the catalogue side of Vickies). Perhaps I will look into enhancing my undergarment selection?
Not to mention keeping on the right side of conflict of interest rules – in situations where conflict issues arise, the law firm will require the employee to use a different firm. There’s a lot of reasons a law firm employee might use a different firm for his personal legal needs.
Oh, I understand the importance of branding - but it is only important insofar as it generates sales. No Coke executive will ever say, “Well, our sales are down 13 per cent, but who cares? More people than ever think we’re really cool.” The brand is what makes sales happen - Coke spends a lot of money trying to show people how a) it cares about what they care about, b) it reflects well on them to drink it and c) it’s the ideal drink for such-and-such an occasion (partying, relaxing on a hot day, spending time with friends). The object being to make us think “Coke” when we feel like a drink - or even when we don’t but we’re relaxing on a hot day. And I’m still not convinced that a photo on the Internet of a Coke employee drinking Pepsi will affect that decision - there’s too much professional image-generation for it to counteract. And in this case, there was no photo - only a handful of people knew about it.
Still, for the same reason I’m not convinced that this story will make any difference either - I think they’re tossers for doing it but I still had a Coke for lunch.
Thank you, Dewey, for standing up for the right to be a bully if you’re big enough to pull it off.
All your fancy words about the free market, and choices having consequences, are simply dressing up the pig here. You’re saying that if you’re big enough, it’s perfectly OK to use your bigness to push people around in ridiculous ways if you can manage it, and by Gawd that’s the way it should be.
Sorry, but if the goals of a free market are worthy enough to be eligible to one market sector, they should apply for all. The idea for a free market is that demand and supply govern themselves without external hindrance or artificial control. I think you have to accept that you cannot use the philosophy or ideals of a free market to justify Coca-cola’s behaviour on this issue.
This is rather a different argument. I must ask why you accept that it’s okay to have preventative controls on some forms of restrictive employer policies, such as hiring based on race or gender, but then think it’s perfectly acceptable for a company to have other such policies. Where does this line sit? You obviously accept that companies cannot be allowed to just fire as they wish - you gave the above cases yourself. Why should the line be one inch more than the case that an employee is either not required due to economic downturn, or is not performing his duties to an acceptable standard.
Of course it’s very dependant on the wording of the contract, and in particular the job description, but I would be very surprised to see that part of his contract is in the form of a sponsorship package to endorse that particular brand of beverage.
Yes, but who is claiming otherwise?
Actually so does mine - my company helps oil companies to share and analyse information, so funnily enough there are strict controls on employees dealing petroleum company shares. This is perfectly in accord with the requirements of a free market, as price fixing or insider trading would obviously distort supply and demand balancing.
May I ask what area you work in, and what controls there are on companies you may invest in?
If Coca-Cola’s policy is as “ridiculous” and arbitrary as you seem to think it is, then Coca-Cola will have trouble attracting and retaining qualified employees. If Coke is acting perniciously, the market will punish them for it.
Your Snidely T. Whiplash-like caricature notwithstanding, Coca-Cola does not have this policy just to be a “bully.” It is not pushing around its employees just for the sake of pushing them around. It is imposing a restriction on its employees because it sees a market benefit to that restriction. The beauty of the free market is that different businesses can try different strategic mixes for success – including rules such as this one – and the efficacy of each strategic mix is proved out in the marketplace.
I know you dig thinking about business executive sitting around, twisting their mustaches and bellowing “muhahahahaha!” while kicking puppies and castrating their employees, but the real world just doesn’t work that way.
I’d like to point out that this driver isn’t just an employee. While he is on the job, he is a Representative of the Coca Cola Corporation. His actions reflect on his company. Every single thing he does while making a delivery, while wearing that uniform, is tied to Coca Cola.
When he is off the job, just being John Q. Public, he can do pretty much anything he wants. When he’s on the job, he’s got to follow the rules, be a good worker bee, and help give Coca Cola a good image.
The basic argument for the free market is that individual enterprises, left to their own devices, will yield the least unsatsifactory results via a Darwinian-like process of success and failure. Companies and individuals who come up with winning mixes of economic value succeed, and those who don’t fail.
Coca-Cola’s policy does not control or hinder the soft drink market. No one is forced to drink Coca-Cola because no one is forced to work for the Coca-Cola company. That simple fact makes the policy perfectly consonant with the free market.
Furthermore, the rule is not uncommon in the world of consumer goods manufacturing and retailing. Next time you’re in the mall, take a gander at the folks working in the Polo/Ralph Lauren store and see how many of them are wearing Gap clothes, and vice versa. Next time you visit a car dealership, note which manufacturer’s car the salesman drive home at night. You get the picture. **
To be frank, I am quite skeptical of antidiscrimination law, on precisely free market grounds: a company that willingly excludes talented people from its labor pool on an irrational basis such as skin color or gender is only hurting itself. I think such laws can be justified on the grounds of historic prejudices and on the grounds that, at least regarding race in the Deep South during the civil rights era, you had a situation where employers were more or less acting as a cartel to exclude blacks. But they are narrow exceptions to the general rule that market participants should be free to make their own decisions about who to hire and who to work for.