Text: In 1985, the highly successful iconic Coke soda was taken off the market and replaced with a new formula, called “New Coke”. At the time, Coke was losing market share in critical market segments and was coming under competitive pressure from its arch-rival, Pepsi. That time in history was noted as the Cola Wars, as Pepsi executed a new promotion called the Pepsi Challenge. Consumers were asked to vote for their favorite tasting Cola on a blind-labeled basis. Pepsi won handily. These taste tests were turned into television commercials. With Michael Jackson as their spokesperson, this was the nail in Coke’s coffin (so they thought). This prompted Coke to conduct market research studies. With similar results, they abruptly changed the formula. The new formula created an immediate backlash and consumers led a revolt and boycott. Within 6 months, Coke brought back the original formula. New Coke is heralded as one of the biggest marketing blunders in U.S. history. Question: What did Coke marketing researchers fail to understand about consumer relationships and loyalty? Explain with details about the market research studies.
Text:
In 1985, the highly successful iconic Coke soda was taken off the market and replaced with a new formula, called “New Coke”. At the time, Coke was losing market share in critical market segments and was coming under competitive pressure from its arch-rival, Pepsi.
That time in history was noted as the Cola Wars, as Pepsi executed a new promotion called the Pepsi Challenge. Consumers were asked to vote for their favorite tasting Cola on a blind-labeled basis. Pepsi won handily. These taste tests were turned into television commercials. With Michael Jackson as their spokesperson, this was the nail in Coke’s coffin (so they thought). This prompted Coke to conduct
Question:
What did Coke marketing researchers fail to understand about consumer relationships and loyalty? Explain with details about the market research studies.
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