Dr. Jeff R. Schutts ([email protected]) July 2005 Draft Chapter for Selling Modernity: Cultures of Advertising in 20th Century Germany, Duke UP Conference Paper @ EBHA conference “Corporate Images”: Frankfurt, 1-3 September 2005 “Die erfrischende Pause”: Marketing Coca-Cola in Hitler’s Germany Toward the end of the Second World War a commotion broke out among a group of German prisoners-of-war (POWs) disembarking from a ship in Hoboken, New Jersey. Restoring order, the American guards demanded an explanation. One of the soldiers captured from Hitler’s Third Reich pointed to a familiar red sign overlooking the harbor, “We are surprised that you have Coca-Cola here too.”1 When the incident was reported in the Reader’s Digest, Americans found the anecdote a surprising contrast to the patriotic marketing that had linked the soft drink to the Allied war effort.2 “It was news to them,” noted Hamilton Burke Nicholson, the President of The Coca-Cola Company in the early 1950s, “that something they consider ‘so typically American’ was considered indigenous to other countries.”3 In fact, many Americans found it unsettling to learn that, in the words of popular Coke historian Mark Pendergrast, “while the soft drink came to symbolize American freedom -- all the good things back home the GI was fighting for -- the same Coca-Cola logo rested comfortably next to the swastika.”4 Today there remains an aftertaste of scandal to the revelation that Coca-Cola “refreshed” Nazi Germany. “I was shocked,” reported the British satirist Mark Thomas. He had associated the Coke brand with pleasant images -- sports, Santa Claus, teenagers on a hillside teaching the world the sing, not despotic regimes. “You discover this huge history of the company that is hidden,” he noted, “hidden because we’re constantly swamped with images of advertising.” In an effort to counter the sugar-coated “Cokelore” nourished by such marketing, Thomas partnered with artist Tracey Sanders-Wood in 2004 to create the “Coca-Cola Nazi Advert Challenge,” an 1 international exhibition of pseudo Nazi-Coke ads created by contemporary artists. In their effort to conjure Coke’s German past and “show the brand for what it really is,” most of the artworks coupled Coke trademarks with Nazi symbols.5 Nonetheless, Coca-Cola already has an established iconic role in German history: it is a totem of West Germany’s “Americanization” during the 1950s. This “Coca-Colonization” has been commemorated by a Coke bottle encased in the standing exhibit at the Haus der Geschichte in Bonn.6 As the state-museum for contemporary history underscored with a special Coca-Cola exhibition in 2002, the soft drink can be seen as a sort of lubricant to Germany’s postwar development of “freedom and democracy”.7 Coca-Cola’s role as the antithesis to National Socialism also was rehearsed in the first academic work to address the soft drink’s presence in Hitler’s Germany. Hans-Dieter Schäfer used Coke’s 1930s German advertisements and sales figures to help identify within the Third Reich a “state-free sphere” of modern consumerism and “on-going Americanization” that de- coupled Nazi “ideology from praxis”. Noting that “guests were encouraged to drink ‘ice-cold Coca-Cola’ from the wall of the Sportpalast where Goebbels gave his speeches,” Schäfer argued that “peaceful cosmopolitanism mitigated the militaristic, racist rhetoric used by the Third Reich to demonstrate its power.”8 However, whereas other scholars suggested that retreat into such American-style popular culture offered Germans a site of Resistenz (the “static” of non- conformity) to the smooth functioning of Nazi social control,9 Schäfer argued that the “split consciousness” engendered by such consumerism served to stabilize the Hitler regime: “Instead of undermining Nazi legitimacy, this [Americanism in the Third Reich] strengthened control 10 over the oppressed.” 2 Some historians were quick to question Schäfer’s assertions, especially as his project rode a wave of scholarship that sought to re-evaluate the “Modernity” of the Third Reich.11 This debate questioned whether “Nazism had paved the way for a liberal-democratic society in post- war West Germany.”12 Whereas in the 1960s scholars argued that the Nazis “revolutionized” German society with their pursuit of a militarized, racially-defined Volksgemeinschaft (“national community”), by the 1980s at issue was whether Hitler was intentionally “progressive” and to what degree the Holocaust could be deemed “modern.”13 Tangled up with these controversies was the problem of categorizing the Third Reich’s nascent consumer society. Instead of joining in this attempt to encompass both Auschwitz and ice-cold Cokes within a new-and-improved concept of Modernization, this essay takes the term “Coca-Colonization” literally when analyzing Coca-Cola’s marketing in Nazi Germany. In examining the actual dynamics involved in the internationalization of Coca-Cola (company, beverage, and icon), this approach reveals that Coke’s success under Hitler demonstrates the process of cultural “creolization” -- a narrative of Coca-Cola’s “Germanization” as much as Germany’s “Americanization” or “Modernization”.14 As an earlier Coke scholar observed of the German POW anecdote: “The reason Coca-Cola people like this story so much is that it sums up the biggest secret of the drink’s success abroad. People of other lands tend to regard it as theirs because their own people produce it.”15 Indeed, Coke’s international expansion was facilitated by adapting the de-centered franchise structure that had allowed it at the turn of the century to conquer the continent-wide American market. By drawing from local resources (sugar, glass, capital, entrepreneurial enthusiasm -- everything but the flavor-concentrate), Coca-Cola could appear “indigenous” wherever it was bottled. As Nicholson insisted, “In France, it is a French business. In Italy, it is 3 an Italian business.”16 Consequently, the Germans who manufactured and brought Coca-Cola to market in the Third Reich were able to infuse it with enough “German character” that it became, as noted in another analysis of those confused POWs in New Jersey, a “symbol” of the German Heimat, or idealized fatherland.17 In seeking to understand better what Germans under Hitler associated with the Coca-Cola trademark, this case-study of Coca-Colonization takes a closer look at Coke’s advertising and public relations in the Third Reich. In deciphering the “creole” of Coke images and Nazi principles, it corroborates Schäfer’s thesis that Coca-Cola buttressed Nazi ideology, whichever “ization” course one chooses to plot the soft drink’s growing popularity. In April 1929, when Coca-Cola was first produced in Germany, there was no reason to doubt that it was an “American” product. Back in the United States, then under Prohibition, Coke easily claimed the title of “the national drink” – Canada Dry Ginger Ale, its nearest competitor at the time, sold only one-third as much.18 Moreover, the expatriate behind the new German bottling franchise, Ray Rivington Powers, with his commanding bulk, flashy car, expensive clothes, and loud jovial personality, fully embodied the local stereotype of “a true American.”19 However, despite his remarkable talents as a salesman, Powers alone did not establish Coca-Cola in Germany. The new soft drink was blocked from distribution in the established German beverage market by a formidable wall of cultural and commercial barriers. These ranged from the infamous “German thirst” for alcohol and a belief that it was unhealthy to drink anything “ice-cold” to the subservience of barkeepers to local breweries and their unwillingness to pay 20 bottle-deposits. 4 Consequently, Coca-Cola could not simply advertise itself into a German market-share as Wrigley’s Spearmint chewing gum had done a few years earlier. Instead, Powers realized, “Product distribution is the basis for a good business, it must precede advertising.”21 What Coca-Cola needed was a legion of local entrepreneurs who could effectively promote it at the grassroots level to both retailers and consumers. Ironically, the onset of the Great Depression facilitated the recruitment of such men and Powers assembled the “Coca-Cola Familie” -- a “Coca-Cola Family” of dedicated German franchise-holding wholesale-distributors who found in Powers’ enthusiasm and Coke’s modest-but-guaranteed per-unit profit the motivation necessary to successfully launch the new soft drink. During the economic slump from 1930 to 1933, while in the United States Coca-Cola sales dropped over twenty percent, Coca-Cola GmbH, the new German Coke subsidiary, increased Powers’ meager first year’s sales figures almost twelve-fold (from 9,439 to 111,720 cases).22 This was an especially remarkable achievement considering that overall German soft drink consumption was cut sixty percent by a devastating tax introduced by Chancellor Heinrich Brüning in 1930.23 Nonetheless, with the tax lifted by Hitler, even the 2.5 million Cokes sold in Germany in 1933 constituted a mere trickle compared to the coming flood. However “real” Germany’s overall economic recovery following the Nazi seizure of power,24 the Third Reich brought increased prosperity to Coca-Cola GmbH and its affiliates. In 1938, after seeing Coke sales in Germany roughly double nine years in a row, The Coca-Cola Company in Atlanta reported: The growth in volume of our business in Germany has been one of the most spectacularly successful chapters in the Company’s history . During 1937, [company bottling] branches in operation, outside Essen [Coca-Cola GmbH’s headquarters], rose from 6 to 13, concessionaires increased from 230 to 425, the roster of employees doubled, retail outlets approached 50,000, retail sales exceeded 55,000,000 units, the Company became the largest consumer of sugar in the beverage industry, the persons in Germany deriving their principle income 5 from its product passed 5,000, and the product itself was by a wide margin the largest selling non-alcoholic beverage in Germany.25 A year later, despite the outbreak of World War II, Germans spent 25 million Reichmarks on over a hundred million ice-cold Cokes.