In light of the overwhelming positives

Understanding the Power of Your Brand

Lessons from New Coke

June 3, 2012 By Contributor Leave a Comment

April 23rd was a quiet day in the Spring of 2008, a nice day; but April 23 became a day that will live, as FDR put it, in infamy at least from a marketing and public relations point of view. It Canada Goose sale was the day Coca Cola introduced New Coke. It is uk canada goose outlet nothing new to say that you need to protect the image of your brand, but that lesson was driven home with uncommon power and violence by the debacle that was New Coke.

Coca Cola has been around since 1886, when Dr. John S. Pemberton, an Atlanta, Georgia, buy canada goose jacket cheap pharmacist, first produced the syrup for Coca Cola. He took a jug of the syrup to the nearby Jacobs Pharmacy, where, according to Coke lore, “it was sampled, pronounced and placed on sale for five cents a glass as a soda fountain drink.” In the years since then, Coke went from a syrup mixed with soda water to a bottled beverage that could be easily distributed throughout the region, then the country and finally the world. Throughout this period, the message was clear: Accept no substitutes, drink only the real thing. In fact, “The Real canada goose black friday sale Thing” became one of Coca Cola’s trademark phrases and its most recognizable tagline. It was also something that would come back to bite the company and Canada Goose Outlet its executives.

Canada Goose sale The Pepsi Challenge Canada Goose sale

Coca Cola’s greatest challenge was its arch rival, Pepsi. Just after World War II, Coca Cola held a 60% market share, but under intense competitive pressure from Pepsi, that market share had dropped to 24% by 1983. Beginning in the 1970s, it became more and more evident that the American public was canada goose uk shop growing more interested in sweeter soft drinks. The Pepsi Challenge, blind taste tests between Coke and Pepsi held in public places, demonstrated the point since the results were overwhelmingly in favor of Pepsi. What’s more, the introduction of Diet Coke, sweetened with aspartame (Equal, NutraSweet) showed Coke executives that a sweeter formulation was in order and extensive market research supported that conclusion.

The key to this research was the top secret Kansas, headed by marketing vice president Sergio Zyman and Brian Dyson, president of Coca Cola USA. They sent canadian goose jacket the marketing department out with samples and surveys. cheap canada goose The results of Project Kansas taste tests showed that:

The high fructose corn syrup formula tested much better than either Coke or Pepsi.

The majority (88%) of tasters said that they would buy and drink this if it were Coke but that they would need to get used to it.

12% of the tasters were angry. Resenting the change, they said that they might stop drinking Coke entirely.

cheap canada goose womens The surveys were actually far more positive and their results led to the decision to change to a sweeter formula. This was fine with Coca Cola CEO Roberto Goizueta. While in charge of Coke’s subsidiary in the Bahamas, he had improved sales by adjusting the drink flavor. This success led to his belief that a change to the taste of Coke could increase profits. No one paid attention to the clue offered by that angry 12% among the tasters, a decision that would have great consequences in the months and years ahead. cheap canada goose womens

canada goose outlet vaughan mills So, Coca Cola management went ahead with the plan. That sweeter formulation, made to go along with the success of the sweeter Diet Coke (which had edged 7 Up out of its place as the Number 3 soft drink), became New Coke. canada goose outlet vaughan mills

The Introduction of New Coke

April 23, 1985, New Coke was introduced to the world at a Lincoln Center press conference in New York City. It was a day that Goizueta and the other executives that mounted the stage had high hopes for. They were about canada goose factory sale to overturn a century of tradition the formula had changed from time to time over the years but it had never been completely changed before and the press, with many questions provided by Pepsi, wasn’t about to let them off easy.

They didn’t. The questions were demanding and the answers considerably less than stellar. Goizueta’s attempt to describe the new flavor was ridiculed in the press as well as the industry as a whole, especially since he was one of the companies best flavor chemists. In the end, they were just happy to have canada goose it over and done with. Other events and give aways followed and pretty soon the customers were back and sales even started to go up. In spite of the rocky start, it looked as if it was working.

canada goose coats on sale Up to this point, Coke seems to have done everything right. They had recognized industry trends, examined the success of their chief rival, conducted extensive market research, prepared a massive public relations and marketing effort and it all indicated that New Coke should be a big hit. canada goose coats on sale

The Angry 12%

The research from Project Kansas indicated great support for the new formula, but it also registered a small but vocal opposition. In light of the overwhelming positives, this segment was ignored. That was a mistake since it indicated the possibility of a major backlash among consumers, which is precisely what happened.

canada goose kensington parka uk After early acceptance among consumers nationwide, the backlash came. Centered in the Southeast, where Coke got its start and where it still is a cultural icon, resistance to the new formula soon spread across America. Some of the highlights of this backlash include: canada goose kensington parka uk

canada goose outlet online store review Chicago Tribune columnist Bob Greene’s widely reprinted articles poking fun at New Coke and attacking the company’s executives for changing it. canada goose outlet online store review

Ridicule from talk show hosts and comedians.

Fans booing New Coke ads that appeared on the scoreboard at the Houston Canada Goose Parka Astrodome.

Long time Coke drinker Fidel Castro called New Coke a “sign of American capitalist decadence.”

Over 400,000 angry calls and letters received by the company. A psychiatrist hired to analyze phone calls to the company hotline reported that some people sounded like they were discussing the death of a family member.

New Coke product boycotts.

canada goose uk black friday New Coke bottles being emptied into the streets Canada Goose Online of southern cities. canada goose uk black friday

Customers attempted to import stocks of the original formula from overseas.

Legal action and a potential boycott from the bottlers over syrup pricing and the backlash they faced individually over New Coke.

With chaos within its consumer base and Pepsi working hard to take full advantage running ads (such as the one where a first time Pepsi drinker exclaimed “Now I know why Coke did it!”), Coca Cola executives were in a panic trying to figure out where they went wrong. By May they were discussing the reintroduction of the original formula and when the June sales figures came out and showed a leveling off cheap Canada Goose of sales, there was real fear that profits would fall. Pepsi’s gains were, however, very small. The fact was that alienated customers didn’t switch to Pepsi, they simply refused to buy New Coke.

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