The Biggest Marketing Flop of All-Time



In 1985, Coca-Cola decided to scrap its classic Coke for a sweeter New Coke. This is now known as one of the biggest marketing disasters of all time. But the cola giant’s recovery was also one of the best of all time.

Let’s provide a little backdrop courtesy of Joe Benjamin:

The Coca-Cola Company had always maintained the lion’s share of the cola market, easily outselling Pepsi five to one in the 1950s. But a genius marketing campaign from Pepsi in the 1980s positioned the relative newcomer as the young person’s drink. Pepsi pulled out all the stops: Celebrity spokespeople, hip advertising music, and poking fun at Coke for being the cola of an older generation. By the early 1980s, Coke had lost its grip on the soda market and only controlled 24 percent of the market share.

The Coca-Cola Company had to make a move; especially since time and time again, sweeter-tasting Pepsi slayed Coke in the clever, blind, and very public Pepsi Challenge. Coca-Cola’s idea was to come up with a new Coke formula that consumers preferred over both old Coke and Pepsi.

No one could fault Coca-Cola for not doing their research: They tested the New Coke formula on 200,000 subjects and came up with a drink that beat Pepsi and old Coke time and time again. Therefore, when it finally went to market in 1985, the company felt confident enough in their research numbers to simultaneously end old Coke production.

The result? Consumers hated it. Coca-Cola fielded as many as 400,000 angry phone calls and letters as Coke drinkers professed their dissatisfaction with the new product. In less than three months, New Coke was pulled off the shelves and old Coke–rebranded as Coca-Cola Classic–was back.

Normally such a move could kill a brand, but Coca-Cola pivoted quickly. In a now famous speech, Donald R. Keough, President of Coca-Cola Company, gave this brilliant speech at a press conference for the return of Coke Classic.

“Cynics say that we planned the whole thing. The truth is that we aren’t that dumb and we aren’t that smart.”

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Intelligent Fanatics July 2018 Digest