Coke Fiasco

I was just thinking about why Coke made the decisions they made when they took the old Coke off the market and created New Coke; it turned out to be a disaster.

I googled Coke and found out some interesting information that I feel pertains to all of us who are in business.

In the early 1980’s Coke was the dominant soft drink in the world.  Then along came Pepsi with their Pepsi Challenge, in which they had groups of individuals sipping a sample of Coke and a sample of Pepsi.  When asked to choose between Coke and Pepsi, the majority chose Pepsi.

Coke then did their own blind study and found the same thing.  When it came to a sipping challenge, the majority chose Pepsi. 
So what did Coke do?  It took their best seller off the market and created New Coke.  What a disaster.  You probably remember it.  

They made New Coke sweeter because Pepsi was sweeter.
Following their error of judgment, they listened to their customers and reintroduced the old Coke back as Classic Coke. 

Here is what Coke didn’t realize about the taste test…the test was just a sip test.  Tasters don’t drink the entire can.  They just take a sip from each of the brands, or as in the Pepsi and Coke example, a sip from each, then make their choice.

When Coke did the test differently, where they allowed the taster to finish the can, they found that the majority chose Coke over Pepsi.
Pepsi happened to be a drink that shines in a sip test.  Does this mean that Pepsi mislead people?

I don’t think so.  It just means that people have two different reactions to colas, depending on the type of test.

Think about how this might apply to your business.

Also, the color of a product makes a big difference.  I remember reading a while ago, that Margarine was originally white in color.  When they changed it to yellow, people accepted it more because it looked like butter.

Just a few examples for you to consider when you are getting feedback from your customers.

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6 Responses to “Coke Fiasco”

  1. Al Rusca says:

    Working as a realtor, interpreting customer feedback is critical to my success. I constantly probe and listen for clues to my client’s likes and dislikes. It begins with the intial contact and continues as we proceed to visit potential properties. Listening to the client’s comments as we tour the first few properties will create a profile for their ideal property. Once I have that profile we usually don’t have to tour many additional properties to find the perfect home.
    As with the Coke example, I try not to jump to conclusions too early in the process. The preferences may change as we view the first few homes. A great deal of time and money will be wasted chasing a phantom profile.


  2. Mo Bailey says:

    Me? Pepsi – always have been…it’s a comfort drink to good memories and emotional connections.

    When I think of my most successful events and planning in business, it flat out always ties into emotional connections.

    Thanks Ken – good ‘food, er drink for thought!’


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