Think about a brand's success story and you might think of Coca-Cola. In fact, with nearly 1 billion Coca-Cola drinks sold every day, it is the most recognized brand in the world. Yet in 1985 the Coca-Cola Company decided to eliminate its most popular soft drink and replace it with a formula that it would market as New Coke. To understand why this potentially disastrous decision was made, it is necessary to understand what was happening in the soft drinks market. In particular, we need to take a closer look at the growing competition between Coca-Cola and Pepsi-Cola in the years and even decades before New Coke was launched. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay The relationship between the arch-rivals had not been healthy. Although marketers long believed that competition between the two companies had made consumers more attentive to cola, the companies themselves rarely saw it that way. In fact, the Coca-Cola Company had even fought Pepsi-Cola in a legal battle over the use of the word "cola" in its name and lost. Outside the courts, however, Coca-Cola had always had the advantage. Shortly after World War II, Time magazine was already celebrating Coca-Cola's "peaceful near-conquest of the world." In the late 1950s, Coca-Cola outsold Pepsi by more than five to one. However, during the next decade, Pepsi repositioned itself as a youth brand. This strategy was risky as it meant sacrificing its older customers in favor of Coca-Cola, but it ultimately proved successful. By narrowing its focus, Pepsi was able to position its brand against the old, classic image of its competitor. As it was increasingly considered the “drink of youth,” Pepsi was able to close the gap. In the 1970s, Coca-Cola's main rival upped the ante further by introducing the Pepsi Challenge, testing consumers blind to the difference between its own brand and "the real thing." To the horror of Coca-Cola's longtime president, Robert Woodruff, most attendees preferred Pepsi's sweeter formula. In the 1980s, Pepsi continued its offensive, taking the Pepsi Challenge around the world and heralding the arrival of the "Pepsi Generation." He also signed celebrities who were likely to appeal to his target markets such as Don Johnson and Michael Jackson (this tactic has survived into the new millennium, with figures such as Britney Spears and Robbie Williams providing more recent endorsements). When Roberto Goizueta became president in 1981, Coca-Cola's number one status was beginning to look vulnerable. It was losing market share not only to Pepsi but also to some drinks produced by Coca-Cola itself, such as Fanta and Sprite. In particular, the overwhelming success of Diet Coke was a double-edged sword, as it helped reduce the market for sugary cola. By 1983, the year Diet Coke rose to third place behind standard Coke and Pepsi, Coke's market share had fallen to an all-time low of just under 24%. Clearly something had to be done to ensure Coca Cola's supremacy. Goizueta's first response to the "Pepsi Challenge" phenomenon was to launch an advertising campaign in 1984, praising Coca-Cola for being less sweet than Pepsi. The television commercials starred Bill Cosby, at the time one of the most familiar faces on the planet and, clearly, someone who was too old to be part of the generationPepsi. The impact of such efforts to distinguish Coca-Cola from its rival has been limited. Coca-Cola's market share remained the same while Pepsi was catching up. Another concern was that when shoppers had a choice, as in the local supermarket, they tended to prefer Pepsi. It was only Coca-Cola's more effective distribution that kept it ahead. For example, there were still many more vending machines selling Coke than Pepsi. Even so, there was no escaping the fact that, despite the proliferation of soft drink brands, Pepsi was winning over new customers. Having already lost its taste, the last thing Coca-Cola could afford was to lose its number one status. The problem, as Coca-Cola perceived it, lay in the product itself. As the Pepsi Challenge had highlighted millions of times, Coca-Cola could always be defeated when it came to taste. This seemed confirmed by the success of Diet Coke, which was closer to Pepsi in terms of flavor. So, in what must have been seen as a logical step, Coca-Cola began working on a new formula. A year later they had arrived in New Coke. After producing its new formula, the Atlanta-based company conducted 200,000 taste tests to see how it fared. The results were overwhelming. Not only did it taste better than the original, but people also preferred it to Pepsi-Cola. However, if Coca-Cola wanted to keep up with Pepsi-Cola, it couldn't have two directly competing products on shelves at the same time. time. He therefore decided to eliminate the original Coca-Cola and introduce New Coke in its place. The problem was that the Coca-Cola company had severely underestimated the power of its first brand. As soon as the decision was announced, a large percentage of the US population immediately decided to boycott the new product. On April 23, 1985, New Coke was introduced, and a few days later production of the original Coca-Cola was discontinued. This joint decision has since been called "the biggest marketing mistake of all time". New Coke sales were low and public outrage was high that the original was no longer available. It soon became clear that Coca-Cola had no choice but to bring back the original branding and formula. “We heard you,” Goizueta said at a press conference on July 11, 1985. Then he left it to the company's chief operating officer, Donald Keough, to announce the return of the product. Keough admitted: The simple fact is that all the time, money and expertise invested in consumer research on new Coca-Cola has failed to measure or reveal the deep and abiding emotional attachment to original Coca-Cola felt by so many. people. The passion for the original Coca-Cola – and that's the right word, passion – was something that took us by surprise. It's a wonderful American mystery, a lovely American enigma, and you can't measure it any more than you can measure love or pride or patriotism. In other words, Coca-Cola had learned that marketing is much more than the product itself. Most of the tests were done blind and therefore taste was the only factor to be evaluated. In the end, the company had taken Pepsi's bait and, in doing so, had given up its strong point: originality. When Coca-Cola was launched in 1880, it was the only product on the market. Therefore he invented a new category and the brand name became the name of the product itself. For much of the last century, Coca-Cola has exploited its "original" status in various advertising campaigns. In 1942, advertisements appeared throughout the United States that 1985.’