However, Pepsi began to slowly catch up to their status and in the early 1980s, Coke had only a one percent lead over Pepsi in exclusive drinkers. Coke was very concerned with this because there product was more readily available than Pepsi’s and they spent more than $100 million more annually on advertising and they really didn’t want Pepsi to usurp their rank as the leading cola. However, Pepsi had been running commercials on television where they put Coca Cola and Pepsi head-to-head in a blind taste test that came to be known as the Pepsi Challenge. In this challenge, Pepsi had faithful coke drinkers take a sip from two different glasses and pick which sample they preferred. One of the cups was marked with a “Q” and the other was marked with an “M.” They consistently chose the cup marked “M,” which would be the cup holding Pepsi. When Coca Cola heard of this challenge, they immediately wanted to prove it to be false, so they conducted blind taste tests themselves. However, when their tests were performed, they got the same results as Pepsi, and the majority of the testers, 57%, preferred Pepsi over Coke. These results really concerned Coca Cola, and they began to do a plethora of other market research projects. They couldn’t figure out exactly what it was that made testers prefer Pepsi, but eventually decided that it must be the taste. From this came the creation of what came to be known as “New Coke.” Coca Cola had their scientists experiment with the secret
Coca Cola’s first main weakness is that it is highly susceptible to any kind of negative publicity. Every kind of negative publicity can hurt the brand badly. Some years ago after traces of pesticides were found in the products of Coca Cola, it had hurt the brand really hard. Sales had dipped in various corners of the world apart from the criticism that flowed. Any such thing can hurt the popularity and sales of coca cola. However, Coca cola can overcome this weakness by being more transparent regarding the ingredients it uses in the production of its brands.
In the Pepsi Challenge in the 1980’s, customers took a blind sip test of Coca-Cola and Pepsi and most people ended up favoring Pepsi. Coca-Cola became worried and started to alter their drink to make it sweeter however after the change people disliked the new Coca-Cola so they changed it back. Though after the challenge people thought
Last year, Coca-cola saw its sales decreased in the European market. In order to increase the sales, Coca-Cola needs to define a new strategic communications plan. As mentioned above the image of Coca-Cola has been damaged quite a lot for the past 2 years by different factors. A hard work needed to deal with consequences of this damage in the image of the company.
Rivalry: The rivalry between Coca-Cola and Pepsi is extremely high; however, both companies continue to remain profitable. Prior to the 1980s, pricing wars negatively affected profitability for Coca-Cola and Pepsi. After Coca-Cola renegotiated its franchise bottling contract and both companies increased concentrate prices, the rivalry began to focus on differentiation and advertising strategies. Through creative advertising campaigns, such as the “Pepsi Challenge” where Pepsi ran blind taste tests to demonstrate that consumers
products to suit customer’s needs, Coca-Cola was able to make a positive step forward in their
The Coca-Cola company has been in business since its inventor began selling it in drug stores in 1886 (The Coca-Cola Company, 2009). Pepsi-Cola was invented a short time later in 1898, but at the time it was called “Brad’s drink.” It was later renamed Pepsi-Cola in 1902 (Butler, 2006). Since those early days when the sodas were invented, Coca-Cola and Pepsi have been in competition with each other for the domination of the world’s soda market. Over the course of more than a century, sales have continued to rise for both companies, and they both consistently earn a profit. Both companies
“A Coke is a Coke, and no amount of money can get you a better Coke than the one the bum on the corner is drinking. All the Cokes are the same, and all the Cokes are good. Liz Taylor knows it, the President knows it, the bum knows it, and you know it."(Andy Warhol, 1975) Regardless of its corporate reputation, the organizational performance and its social responsibility of Coca-Cola makes it loved around the world. Ever since its creation in 1886 Coca-Cola has been a household brand known globally for generations of families. I have to mention, of all the cases researched this is my least favorite not only because of my childhood love for the product because the ethical issues in one way or another always manage to resolve themselves not before further tainting the reputation Coke worked so hard to obtain. Most times, whether an organization is innocent of an unethical act, it becomes secondary to the suspicion of the original act. Almost as if the court of public opinion has the power to ruin the reputation of an organization based on an unfounded accusation. In spite of my loyalty after having ready the case, I do believe Coca-Cola to be flawed. The contamination scare in Belgium is a great example of a public relations nightmare. The slightest hint of impurity should have pushed Coca Cola into crisis management mode but they were slow to react, citing it a minor issue (Ferrell, Fraedrich, & Ferrell, (2011). It was not until local officials
The revolution lead to a revolt as well as the rebirth of the old classic coke. Two new campaigns were introduced after the consumer crisis in 1985: the most popular Red White and You, pathetic appeal for Coca-Cola classic and the Catch the Wave for the new taste of coke (“The Real Story of New Coke”). During the summer, Coca- Cola announced the taste variance; frantic consumers purchased coke in bulk hoarding the remains in their homes while others formed protest bands with claims to having brought back the original formula. Coke’s prior history is significant because they used their short fall as a comeback. For instance if you fail a test but then study harder for the next one and receive a passing grade, you have redeemed yourself. Same with failing in an area of life there is still a chance reclaim the past downfall to enrich the future.
The traditional change model consists of three steps: unfreezing, i.e. recognizing the need for change because of some event or threat, the actual change actions and refreezing, i.e. incorporating new ways of operating and thinking into everyday operations of the organization. Apply this model to the situation at the coca-cola company at the point when the lawsuit was served in 1999.
The company known as Coca-Cola today was started in September of 1919, but the first Coke brand was served as early as 1886. Since that time it has grown to be one of the most globally recognized brand names with a stock value of $167 billion. Coke’s plan has always been developed with the future in mind. Right away the company realized that it was more profitable to manufacture the concentrate used to make carbonated drinks than to bottle it. From that point on they saw the entire world, not simply the originating country, as their desired market. It seems only practical that the company should pursue this agenda until conquered then focus the effort on expanding into different product lines. This logical
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”.
Marketing strategies began to take broader dimensions as the soft drink industry continued to expand and became more complex. In 1976, Pepsi introduced the Pepsi Challenge in its campaigns, a moved that directly challenged Coca-Cola’s longstanding dominance. In 1985, responding to the pressure of the taste tests, which Pepsi always won, Coca-Cola decided to change its formula. This move set off a shock wave across America. Consumers angrily demanded that the old formula be returned, and Coca-Cola responded three months later with Classic Coke. Five years after the infamous Coke fiasco, the Coca-Cola
A company must be in tune with what consumers want. Consumers get bored, and often want new products. In order to meet the wants and needs of customers a company must introduce new products or services (Bateman &Snell, 2003). Coca-Cola, in an effort to meet customer's needs, created C2 which is a low carb soft drink. This was in response to the low carb diets and the demands of consumers. They also intend to launch a new soft drink called Coca-Cola Zero. This is a zero calorie soft drink. Knowing the importance of innovation the Coca-Cola Company has always strived to create new products. They already have Coke with Lime, Lemon, Vanilla and Cherry. Raspberry will be the new flavor added to Coke coming soon. They also have plans to sweeten Diet Coke with Splenda, a sugar substitute that is safe for
Coca-Cola has been around for generations with the same iconic taste, logo and symbolism. Its brand has represented family and the memories of good times, celebrations and comfort of being with those we love. Unfortunately, the company has not made good marketing decisions in the recent past and has lost relevancy. The purpose of this essay is to assess the conditions that created Coca-Colas marketing problems, evaluate the future of healthy beverages and non-carb drink brand extensions, and provide recommendations to the management.