5.10. Lessons from the New Coke - How Coca Cola Flopped in a Race to Better Taste

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In April 1985, the Coca-Cola Company decided to discontinue its most popular soft drink and replace it with a sweeter formula it would market as “New Coke.” As soon as the decision was announced, a large percentage of the US population boycotted the drink and made sales plummet for the company. Outrage over pulling the original coke recipe was high, and after only 79 days of introducing New Coke, the product was pulled from shelves and the original Coke returned. So what went wrong?

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As the Pepsi Challenge had highlighted millions of times [over], Coke could always be defeated when it came down to taste. So in what must have been seen as a logical step, Coca-Cola developed a new formula and 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.

Coca-Cola decided it was time to make a drastic decision that, to this day, is considered extraordinary in the history of brand marketing. They changed the recipe for the first time in 100 years and created “New Coke,” the sweeter alternative favored in the blind taste tests. They pulled all traditional Coca-Cola from store shelves and replaced them with the new formula, leaving consumers with no option but to drink New Coke instead of the Coke they had known before.

The company expected sales to rise, and they initially did. But the outrage and drop in sales that followed were unprecedented and unexpected.