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As you know, Coca cola and Pepsi are always rivals in soft drink
market from 1900s until now.
In the late of 1950s, Coke outsold Pepsi by a ratio of more than five
to one.
However, in the next decade, Pepsi repositioned itself as a youth
brand. This strategy was risky because it meant sacrificing its older
customers to Coca Cola, but ultimately it was very successful.
In the 1970s, Pepsi introduced the campaign: Pepsi challengetesting consumers blind on the difference between its own brand
and Coke of Coca cola. In the result, most of those who participated
preferred the sweeter formula of Pepsi.
In the 1980s, Cokes share of the market remained the same while
Pepsi was catching up. The number one status of Coke was starting
to look vulnerable. According experts of Coca cola, the problem is
the taste of coke; so they need a new formula to keep the number 1
status.
Failure:
So, on 23rd April 1985 , NEW COKE was introduced and few days
later the production of original Coke was stopped. This joint decision
has since been referred to as the biggest marketing blunder of all
time.
As soon as this decision was announced, a large percentage of the
US population immediately decided to boycott the New Coke. Thats
why New Coke existed on market only 79 days. New Coke made the
company lose millions and their No. 1 too.
According to Time Newspaper, they list New Coke in 2nd rank of 50
worst inventions.
Reasons:
What are reasons of Coca cola failure?
Coca Cola limited the ..With Pepsi challenge, Pepsi show that
people prefer the taste of Pepsi than Coke. This makes Coca Cola
feel worry and they think the problem is the taste, so they wanna
change. However, people prefer the taste of Pepsi not mean that
they will buy Pepsi more than Coke. Customers buy Coke not only
because of its taste but they see another value of Coke: originality.
Think of Coke, they will think about an American drink that is a part
of American tradition and culture. But Coca Cola did not realize this,
they underestimate
So, these things led to the market research mistakes of Coca Cola.
Coca cola spent so much time and money for 200000 tests for their
new product but the only factor can be measured in these test is the
taste of product. Market researches of Coca cola just focused on the
Solutions:
o How coca cola can solve the problem. At that time, Coca Cola had
no choice, they have to bring back its original brand and formula. On
11 July 1985, the company held a press conference with a public
apologize, they said: We have heard you and announced the
return of classic coke.
o Within months, Coke had returned to the number 1 spot.