New Coke

New Coke failed because Coca-Cola took the original off the market to make room for it, and enough drinkers missed the old taste to force it back. The company returned the old formula 79 days after the launch.

What it was

New Coke was the informal name for the reformulated Coca-Cola that The Coca-Cola Company announced on April 23, 1985, its first formula change in 99 years, the company's history says.

The can just said Coke, with the word "new" on it, CBS News noted in 2015. New Coke replaced the old formula, and production of the original ended the same week, Snopes wrote.

Coca-Cola's history page says its share lead over its chief competitor in its flagship market "had been slowly slipping for 15 consecutive years." The new formula was "preferred in taste tests of nearly 200,000 consumers," it says. Its sweeter, more syrupy taste "was intended to compete successfully with Pepsi," Donna Braden, a curator at The Henry Ford museum, wrote in 2015.

Roberto Goizueta was chairman and CEO. Donald Keough was president.

What happened

The first figures for New Coke looked good, and complaints arrived at the same time. Coke sales in May 1985 were up 8% on May 1984, mostly from the new drink, Time reported in June, and Coke officials said they were pleased. Coca-Cola said its surveys showed that 75% of Americans who had tried it said they would buy it again.

By June, the company was getting 1,500 calls a day on its consumer hotline, against 400 a day before the change, its history says.

Old Cola Drinkers of America, a protest group started in Seattle, claimed to have recruited 100,000 people, according to the company. Its own hotline took 60,000 calls before it was disconnected, Time reported.

Brian Dyson, president of Coca-Cola USA, insisted in the same Time story, "We are going to stick with what we have done."

On July 10, 1985, Coca-Cola announced that the original would come back within weeks as Coca-Cola Classic, UPI reported that day. Executives held a press conference on July 11, CBS News said, and the company dates the return to that day, 79 days after the launch.

The two were sold side by side. Classic began outselling New Coke and had taken the sugar cola lead back from Pepsi in early 1986, Snopes wrote.

New Coke was later renamed Coke II, and it stayed on shelves next to Classic until 2002, Braden wrote. Coca-Cola's 2012 history says it is no longer available in the US.

On May 21, 2019, Coca-Cola announced a limited number of New Coke cans, to be released from May 23 as part of a Stranger Things promotion with Netflix.

Why it failed

Coca-Cola has said its research couldn't measure how attached people were to the original. A survey reported at the time found most people who had tried the new taste preferred the old one. Later accounts blame the sip tests, the withdrawal of the original, the bottlers being left out, or a backlash against change itself.

What Coca-Cola said

At the July 11 press conference, Keough said the time, money and skill poured into consumer research "could not measure or reveal" the "emotional attachment to original Coca-Cola felt by so many people," CBS News reported.

Coca-Cola's 2012 history says its taste tests didn't show "the bond consumers felt with their Coca-Cola."

"The truth is we are not that dumb, and we are not that smart," Keough said of the theory that the whole thing was planned, as Snopes quotes him.

At a 1995 employee event for the 10th anniversary, Goizueta called it a prime example of "taking intelligent risks," the company says. "We set out to change the dynamics of sugar colas in the United States, and we did exactly that," he said, "albeit not in the way we had planned." Mother Jones reported that he also told employees it was "a blunder and a disaster, and it will forever be."

None of these statements says the new taste was worse.

What reporting showed

UPI set the company's taste tests, which favored the new taste, against a survey by the Chicago research firm Leo J. Shapiro. In that survey, 59 percent of soft drink buyers who had tasted the new Coke said the original tasted better.

Jesse Meyers, publisher of the Beverage Digest newsletter, said the decision to bring back the old formula was "absolutely" the result of a groundswell of negative reaction, UPI reported.

Roger Enrico, president of Pepsi-Cola USA, said in June that his surveys showed 60% of new Coke drinkers found it "weaker in flavor delivery," Time reported. Time cautioned that the publicity distorted the early figures.

What later analysis found

Malcolm Gladwell, in his book Blink, points to studies showing that taste tests favor sweeter drinks, Tim Murphy wrote in Mother Jones in 2019. Coke had been losing ground to the sweeter Pepsi, Murphy wrote, and the sip-test bias helps explain "why the New Coke tests led the company astray."

Murphy called it "a comforting explanation" and didn't accept it. Company surveys of people who had finished their cans "found a favorability for New Coke that matched the first-sip test," he wrote, and the backlash was "a revolt against the idea of change."

Historian James C. Cobb wrote in Time in 2015 that the outcry came "in no small measure" from consumers resisting forces they saw "usurping their personal prerogatives over even the mundane elements of daily life."

A 2004 Knowledge at Wharton review of Constance L. Hays's book The Real Thing said introducing New Coke "was not quite the clueless blunder often featured in textbook explanations." It called the unveiling "a needless disaster," because the bottlers, who knew what drinkers in their districts liked, "were never consulted about New Coke."

Some people think New Coke itself wasn't the problem, Braden wrote. "The problem was that the company did away with old Coke."

The stage it reached

New Coke belongs in the maturity stage, because it replaced the core of a product already there, when growth has slowed and share moves between a few big players.

In the product life cycle, the usual move at maturity is to keep the core steady and put new work into line extensions. Coca-Cola changed the core and withdrew the original in the same week.

After July 1985 Classic outsold it, and New Coke became a side product. I count it as a failed replacement, not a product that grew and then declined.

The lesson

The lesson from New Coke is to test what loyal customers would lose when you change a mature product, as well as what they'd gain.

I don't think Coca-Cola's research got the taste wrong. The tests measured which sip people preferred, and the sweeter one won. They didn't measure how people would feel once the old one was gone, and Keough said as much on July 11.

Ask your most loyal customers what they'd do if the old version disappeared, and build a product feedback loop that reads complaints as closely as surveys. In June 1985, Coca-Cola's surveys looked good while its executives said they were getting almost four times the normal volume of calls, Time reported.

Coca-Cola still had the old formula and brought it back within 79 days. I'd copy that part.