Introducing the New Coke

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HBR Case Study: “Introducing New Coke”

1. What is the case about?

This case study is the story of Coca-Cola, its history and the report about one of the most fascinating stories about the company this is still regarded by many as a mysterious case: “the introduction of the new Coke”.

The author Susan Fournier, in the case study went on by presenting the history of the Coca-Cola Company: how the company started and how throughout its history it became a brand, a part of everyone’s life both nationally and globally. Anecdotes and little stories were told about how Coca-Cola became a part of the American Culture, it how it changed the way consumers around the world perceived the Christmas holiday (Coca-Cola Classic Santa Claus).

Midway through the case study, the author introduced what is still perceived today as one of the most intrigued case studies: the way Coca-Cola handled one of its competitors, Pepsi-Cola, and the introduction of the new Coke. The author walked us through how with marketing research, product testing (The Pepsi Challenge) and effective advertising, Pepsi-Cola was able to introduce itself in the American culture. Pepsi became Coca-Cola’s fierce competitor and started getting a growing share of the market of soft drinks.

Blinded by internal and other distractions, Coca-Cola was caught by surprise when introduced “the Pepsi Challenge”, a series of blind tests where potential consumers tasted both Pepsi and Coke, with the results concluding that Pepsi had a better taste than Coke. Coca-Cola quick called the move false advertisement and conducted its own blind test only to realized what was already stated.

With changes in the company’s management, the focus was put on fixing the problem, an order was passed by the new chairman of the company to find a new taste for the product and presenting it to the public. The company did some research and decided to launch the new product. What Coca-Cola miscalculated was the rejection of the public and the loyal consumers.

After serious backlash, Coca-Cola was force to stop persisting in stubbornness and grasp the reality that they needed to go back to the original taste of the product, a change that they finally made in less than 3 months after the launch of the “new coke”.

2. What is Coca-Cola? In terms of Ted Levitt’s famous question, “what business is it in”?

This question is more of a debate than a definitive answer. If we refer to the industry, the Coca-Cola is in the beverage industry, an assessment which is too obvious. But, if we dig deeper into the case study we and refer to Ted Levitt’s question realize other hints that make us believe that there is more the answer. The purpose of Ted Levitt’s question was to force us to look beyond the distinction between market and industry, but the broader spectrum of ways companies target the greater public appeal.

Referring to the study case, Coca-Cola was more than a beverage company, it became a part of culture and politics, it changed the way Americans viewed Christmas, and it went global… I think that Coca-Cola is not only in the beverage business, but also in entertainment, memory sharing, it provides nostalgia, a sense of ownership, pride, personality and belonging to its consumers, mostly in the US. Coca-Cola business is to offer a fun, memory-inspiring sweet beverage.

3. What was Coca-Cola’s brand building strategy? Where did Coke’s meanings come from? How did Coke’s meanings make a connection to consumers and to Christmas?

Coca-Cola’s brand building strategy started first by finding its target, which early in its history was the non-alcoholic drinker. Shortly after the acquisition of the company by Griggs Candler who’s dream was “to place Coke within arm’s reach of desire... wherever there are people who get thirsty”; Coca-Cola started building his brand. The strategy then was focused around: availability, affability and...
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