• by David Goetzl  @dgoetzl, February 15, 2007

How often does a CEO give an agency credit for reducing its costs? On Wednesday, Coca-Cola CEO Neville Isdell praised the effectiveness of Wieden + Kennedy's "Coke Side of Life" campaign, both for its ability to drive brand recognition, and as a result, save the marketer cash.

According to Isdell, the ads are working well enough that, unlike previous years, Coke hasn't had to alter or abandon creative mid-campaign. As a result, since new ads aren't as needed, allowing for a longer on-air run, production costs are down. So are agency fees, which may be a mixed blessing for Wieden.

Isdell said the "Coke Side of Life" campaign is "driving increased efficiency as our television commercial re-use rate was double our 2002 to 2005 average, resulting in a mid-teens percentage reduction in our overall TVC (television commercial) production and agency fees."

He cited the "Happiness Factory" and "Video Game" spots, both airing globally and fresh off Super Bowl appearances, as big plusses--a "star performer" in the case of "Happiness Factory." The ads are from Wieden's Amsterdam and Portland offices, respectively.

The CEO's comments came on a conference call with analysts to discuss fourth-quarter results--which were disappointing in North America. He cited the creative as key to boosting sales of Coke's flagship brand going forward, with troubled waters ahead.

Volume in North America declined 2% for the quarter, and Isdell said due to increased costs and weak demand for carbonated soft drinks, he expects "2007 to be weak, particularly in the first half."

Coca-Cola's international business was stronger, with a 6% volume growth. Overall, the company saw revenues rise in the quarter by 7% to $5.9 billion, but net income dropped 22% to $678 million.

In addition to the "Coke Side of Life," Isdell touted Coke's efforts to turn its Web site coca-cola.com into sort of a portal for teenagers, featuring sports, music and other offerings. It's part of the brand-generated content trend marketers are embracing en masse--the most prominent example being Anheuser-Busch's new Bud.tv broadband channel--with the goal of building brand equity more by involving/entertaining consumers than talking to them.

Versions of Coca-Cola.com are now tailored to 31 countries and in 11 languages, with 664 million impressions last year, Isdell said.

"It is really a step change in recruiting and connecting our brands to teens in a truly unique way," he said, "really leveraging their passions for entertainment for sports and for music."