Failure is a Bruise, not a tattoo, and Bruise heals with time….
A perfect example is the failure of the biggest soft drinks house, Coke back in 1985 which no one even remembers now probably because they bounced back pretty fast.
Facing a fall in market share from 60% to a drastic 24% in 1983 (when Pepsi was waving its flag higher than ever), Coke decided to ditch the Original formula and start anew.
Hoping to possibly rock the world with the new product based on their 2 years long research and $ 4 million they launched a new formula with a completely different taste. They were to their despair rewarded with 3 months of unrelenting protests.
So why did Coke fail?
First off, they decided to rely on the liking of a majority of only 53% against 47% from selected people. The taste testing carried out for 2,00,000 people was subject to bias. Since the test was carried out blind so the only basis for their liking or disliking was only Taste.
The entire consumer research was carried out only for people in Atlanta, hence ignoring the rest of America (an example of poor segmentation).
The questionnaires used had closed end questions which were not able to actually reveal their feelings. They also generalized the results from focus group discussions although the results were quite conflicted.
But more than anything they were unable to recognize the attachment and passion people had for the brand and the soda. And since human behavior is so hard to predict the best thing you can do is get a complete and accurate picture of the market.
So out of all the rumors about the Coca-Cola Company, this one is true.
By
Pankaj Gusain
