Coca-Cola Marketing Blunder

In April of 1985, The Coca-Cola Company announced that they were changing the formula of their product and launched “New Coke” pulling old Coke from the shelves. Following an outcry from consumers, Coca-Cola reintroduced the old formula as “Classic Coke.” Since then, Classic Coke has dominated the market as the number one brand of soft drink in the world. Many call Coca-Cola’s strategy a huge marketing blunder. Discuss what marketing research might have driven this decision by Coca-Cola. Do you think this was a marketing mistake, or a brilliant strategy?

The Coca-Cola example is one that could have been a disaster, but seems like it almost worked out in their favor. Weather the reason or problems was Coke was looking to gain more customers with a “new taste” or less sugary drink, it was very apparent that they should not have replaced the Classic Coke with New Coke. I would have thought that using a tool like a test market, or customer satisfaction studies would have shown that New Coke would not be an acceptable replacement. 

Pepsi did something similar to this in the early 90’s with their product “Crystal Clear Pepsi”.  Pushing this clear pure “healthier” liquid that as their slogan claimed, "You've never seen a taste like this".  While this product did have positive response to test markets, in the end Crystal Clear Pepsi did not last long.  Unlike Coke Pepsi did not try to replace their current Pepsi product with their new Crystal Clear Pepsi. This was probably a better approach, as Pepsi did not upset the customers that were already committed to its current product, and bring a new exciting product for those looking to try something new.

Coke really gambled with this strategy. I would probably classify it as a mistake. I don’t see a big company like Coke looking to increase their sale of their product by taking it away and giving their customers a product that is not as good in hopes to create major attention on bringing back the old product. In the end, it probably worked to their favor, as their Classic Coke was so good they had to bring it back. It also says something about the company as it was willing to switch back to keep their customers happy.

Resources:

AIO Lecture Week 1

http://www.thecoca-colacompany.com/heritage/cokelore_newcoke.html

http://en.wikipedia.org/wiki/Crystal_Pepsi

http://www.featuredtopic.com/2010/01/top-10-discontinued-sodas.html

http://askville.amazon.com/Pepsico-discontinue-Crystal-Pepsi-bring-back/AnswerViewer.do?requestId=16832515