An ice cold Coca Cola Classic, please!

Does failed research lead to a failed product?

It’s funny how worlds often collide in timing you could not have predicted. I just finished Malcolm Gladwell’s book Blink: The Power of Thinking Without Thinking. It is a psychology driven, anecdotal account of adaptive consciousness. This comes at a time when I am knee deep in UX Academy courses and projects and deep thinking seems to be all I’m doing these days. But that’s not the worlds colliding part.

In Blink, Gladwell has many accounts of where snap judgements are the key to understanding human behavior. Most interesting is one account of when these types of quick thoughts did not work out so well: the case study of “New Coke.”

In UXA, we are learning about research and product development with empathetic eyes and ears to what the end user desires and will use. In an effort to understand better, we are taking a look at a failed product and how failed assumptions played in to the product’s downfall. “New Coke” is an excellent example.

What is “New Coke”?

In the early 1980’s, Coca Cola was still on top of the soda industry, but had dropped to only 24% of the market share . A newer player was starting to take up market space and Coke had to react. Pepsi came out with a marketing campaign to entice younger people to enjoy their product, using more current music in advertising and touting Coke as a an older generation’s drink.

In the early 1980s, Pepsi saturated the market with the “Pepsi Challenge,” a blind taste test where people were asked to choose from two small cups of Pepsi or Coca Cola, not knowing which was which. In these quick studies, Pepsi edged out Coke in taste tests. Pepsi’s sweeter recipe proved to be more appealing in a blind, small sample portion.

In response to these results, Coca Cola set off to create a new recipe. Keep in mind, Coke had the same recipe for 99 years that had only seen very minor tweaks. New CEO, Roberto Goizueta, was unafraid of change and pushed forward with creating a sweeter, “New Coke.” Even though this product was tested on 200,000 subjects, with 62% preferring New Coke over Coca Cola Classic and Pepsi in blind taste tests, New Coke ultimately failed.

They did the research, why didn’t it work?

As the “Pepsi Challenge” became more popular and wide spread, it seemed obvious that whichever cola won in the blind taste tests would be the one to take the top spot in the market. But take a minute to think about that logic. Soda drinkers do not just sip one taste of a beverage blindly in day to day life. The sweetest product does well for a one shot test, but over time, a drinker may not prefer such sweetness. This is where failed assumptions hurt Coca Cola.

On April 23, 1985, New Coke was introduced and CEO Goizueta proudly announced to 700 reporters at New York’s Lincoln Centre that “The best has been made even better.” Leaks about the new release had journalists backlashing with negative questioning, asking the CEO if he was sure this was the best move.

Although some Northern states saw minimal adoption of the product, the Southern United States (Coca Cola originating in Atlanta, Georgia) was in an uproar. Loyal customers felt blindsided. Coca Cola hotlines fielded more than 400,000 dissatisfied phone calls. A coalition against the product, Old Cola Drinkers of America, even filed a class action law suit to bring the old recipe back.

By July 11, 1985 New Coke was pulled from shelves, only having a 79 day run. Coca Cola reportedly spent over $4 million in product development and was left with over $30 million in unwanted New Coke concentrate after the fact.

Is there such thing as wrong research?

Depending on which view point you look at, this overall could seem like a failure or a win for Coca Cola. Of course the company says it was not a mistake, as they took a risk and with all the publicity the mishap caused, Coke remained on top of the soda market.

But how could the New Coke fiasco have been avoided? Did the researchers do something wrong?

Although there was research done, it failed to take in to account the brand identify, familiarity, nostalgia, and loyalty Coca Cola had built up in it’s near 100 years of production. At the time, people identified (and often still do) as Coke drinkers or Pepsi drinkers. And without even asking for an update, Coca Cola was asking their loyalists to adopt New Coke.

The research done was too focussed on only one aspect. What about the drink over the long term? How did consumers feel about a new recipe? The Coke loyalists felt their opinions and feelings were not considered, which is a quick way to lose trust.

“The entire principle of a blind taste test was ridiculous. They shouldn’t have cared so much that they were losing blind taste tests with old Coke, and we shouldn’t at all be surprised that Pepsi’s dominance in blind taste tests never translated to much in the real world. Why not? Because in the real world, no one ever drinks Coca-Cola blind.” — Malcom Gladwell, Blink: The Power of Thinking Without Thinking.

If the Coca Cola company had not relied on the failed assumption that the initial taste reaction was the most important aspect to focus on, perhaps New Coke would have never been created. Instead, we may have seen a total new direction in marketing and advertising, targeting the younger generation of soda drinkers who would have interest in the full calorie version of Coca Cola Classic. And perhaps poor Bill Cosby would have avoided being the spokesman for New Coke and ruining his reputation (oh wait, is that not what did it?!).

Coca Cola is an American staple as far as brand and recognizability. Why fix what wasn’t broken? And if an update needed to be made, a broader focus could have taken a more successful direction to compete with the market.

As I reflect on this failure in research and failure in assumptions, my takeaway is to try to keep in mind that even when one aspect of research may seem like the key to the answer, my future success in UX depends on taking in to account the feelings and reactions of the users I’m serving.

And on that note, I think I’ll have an ice cold Coca Classic.