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Failed Market Entries: New Coke and Metaglip
Individual Assignment One
Thom Whitledge
University of Phoenix
Instructor: Rob Thomas
August 3, 2003
GMGT 530
Introduction
The purpose of this paper is to examine two market entries that failed. The first is a blunder of colossal proportions that the Coca Cola Company executed in the 1980’s, the introduction of New Coke and the removal from the market of the world’s number one soft drink, Coca Cola. ...
The New Coke Fiasco
In what Pepsi Cola-USA president Roger Enrico called, "the Edsel of the 80s," the introduction of New Coke represented one of the greatest marketing debacles in recent history. ... John Pemberton, invented Coke in 1886. During the next 100 years, the Coca Cola Company became the world’s number one producer of soft drinks. Coke was losing market share to its biggest competitor, Pepsi. Cokes lead had dropped from a better than two to one margin in the 1960’s to a 4. ... Coke was outspending Pepsi on advertising, by $100 million per year and losing market share. ... Taste tests indicated that Americans, the largest consumers of sodas, preferred the taste of Pepsi to that of Coke. Coke had maintained its market share dominance by having a much more aggressive distribution strategy than Pepsi. The company felt that if Coke was in more stores and restaurants than Pepsi, more people would drink Coke, but share continued to decline. Upper management at Coke became convinced that the “Pepsi Challenge” had proven that Pepsi was superior to Coke. Brian Dyson, president of Coca-Cola USA, said "Maybe the principal characteristics that made Coke distinctive, like its bite, consumers now describe as harsh. ... " By the fall of 1983, the top brass allowed Dyson and Roy Stout, head of market research "to explore the possibility of a reformulation. ... In September 1984, it seemed that the project team had found an answer to the dilemma faced by Coke. The technical division brewed a formula of Coke that beat Pepsi in blind taste- tests by as much as 8 points. ... Rather than introduce a new option for Coke drinkers, Coca Cola decided to halt the distribution of the original formula and replace it with the new formulation with the name New Coke.
Approximate Word count = 1852
Approximate Pages = 7.4
(250 words per page double spaced)
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