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1985 New Coke Fiasco. ... They called the product, New Coke, with the intent that
it too would take the market by storm like its predecessor had. ...
New Coke; Coca-Cola’S Big Mistake. ... Either way, in the end, “new coke” changed
“old coke” forever. Works Cited Allen, Frederick. ...
new coke. ... Before Coca-Cola launched New Coke they had invested US$4,000,000
in market research and undertook 200,000 blind taste tests. ...
... Some authorities believe that New Coke, as the reformulated drink was called, was
invented specifically to respond to its commercial competitor, Pepsi. ...
... That is worth 200 million dollars a year." Coca-Cola management had to decide: Do
nothing or "buy the world a new Coke." They decided to develop the new formula ...
Submitted by ranjit on September 18, 2005
Category: Business
Words: 1840 | Pages: 8
Views: 381
Popularity Rank: 25,710
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Table of Contents
Topics Page No.
1. Introduction 1
2. The Reformulation 2
3. How had the Coca-Cola management got it so wrong? 3
4. Were there less drastic alternatives? 5
5. Understanding your Loyal Customer 6
6. Conclusion 7
Reference 8
1. Introduction
Coke was invented by Dr. John Pemberton, an Atlanta pharmacist and his three-legged brass pot all the way back in 1886; by 1985 Coke was closing in fast on its centennial anniversary. (Cook, 2002) Coke along with the legendary chairman Roberto C. Goizueta had witnessed a remarkable set of accomplishments during the 1980's. There were some creeping problems, however. The 87-year old rivalry between Coca-Cola, the traditional market leader, and Pepsi Cola, the perennial runner up, took an unexpected turn in the mid-1970s. Pepsi's consumer research had discovered in blind taste tests that a majority of consumers preferred the taste of Pepsi over that of Coke. In fact, even a majority of loyal Coke drinkers were reported preferring Pepsi in the tests. Pepsi began communicating these findings to consumers through "Pepsi Challenge" television ads, during those days, showing taste tests where Coca-Cola drinkers expressed preferences for a cola which was then revealed to be Pepsi. (Schindler, 1992)
By 1977, Pepsi had actually pulled ahead of Coke in food store market share. (Schindler, 1992) Coke's lead had dropped from a better than two to one margin to a mere 4.9 percent lead by 1984. (Bastedo & Davis, 1993) Coke was clearly in danger of becoming the Number-Two soft drink. In April 1985, the management of Coca-Cola Co. announced its decision to change the flavour of the company's flagship brand. The events that followed from this decision, as well as the factors which led up to it, have been reviewed, discussed, and...
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