New Coke: it was possibly the biggest marketing blunder in history, except maybe the Chevy-Nova-in-Mexico fiasco (get it? “No va” is Spanish for, “It doesn’t go.” Yeah, Chevy didn’t get it, either, at least not in time to stop the launch.)
It was the 1980’s, and The Coca-Cola Company tried to launch a new recipe for their inaugural product. The reason for the formulation change? According to all the statistics (and the commercials), Pepsi beat Coke in taste tests. Coca-Cola, feeling the pressure to compete with this new and up-and-coming beverage, the beverage of our then-youth and future consumers, decided that consumers preferred Pepsi’s sweeter flavor. So the Coke formula was revamped, and New Coke was born.
Some of you may be old enough to remember what happened next. Consumers, and particularly consumers in the southeastern United States where the product was originally launched, rebelled against this new formulation.
The company recovered in less than a week by reviving to its original formula and christening it, “Coca-Cola Classic.” The product’s popularity spread like wildfire with the new-old flavoring, and many speculated that the whole thing was a ploy.
It wasn’t a ploy. It was a mistake, and here’s why. Yes, consumers preferred the taste of Pepsi in blind taste tests. But blind taste tests miss the mark when it comes to marketing. People don’t buy their beverages for taste alone. They buy it for the taste that best complements their meals. And in the most brilliant of marketing strategies, they buy nostalgia.
But the company did the best thing it could have done – they reacted quickly to the outrage and re-invented their classic, nostalgic product. They learned from the mistake and adapted.
As a small business owner, I consider my marketing strategy every day. I meet with key employees to discuss that strategy at least once a week. I like to look at the successes and errors of other companies to consider how much risk I want to take.
Because the take-away here is not to avoid risk altogether. In fact, big risks bring big rewards, when they pan out, and I like big rewards. But advance planning can have a big impact on your bottom line when you do take a risk that might fail. Do you have an exit strategy? What plans do you have to corral your customers back into the fold if they stray?
It’s wise to consider these things before pressing the “Start” button. Brainstorm all the things that could go wrong, and have a plan in place for addressing each problem. No, you won’t think of everything. That’s where adaptability comes in. Meet regularly with your advisors (note: if you don’t have advisors, you shouldn’t be a business owner) and evaluate how the strategy is going. Be ready to act quickly and make changes as needed. New Coke may have been one of the biggest marketing blunders in history, but the company’s response resulted in a brand that was stronger than ever. And that’s what marketing is all about.