The Fall and Rise of Coca-Cola

“[It’s] smoother, uh, uh, rounder yet, uh, bolder… a more harmonious flavor.”

So were the words of Robert Goizueta at a press conference held at Lincoln Center in New York City nearly 28 years ago. At the time, Goizueta was the Chairman and CEO of The Coca-Cola Company. Formerly a flavor chemist with the world’s most famous soda producer, Goizueta knew what he was talking about.

Or at least he sure should have.

Goizueta was describing the flavor of the newly reformulated Coca-Cola, or “New Coke” as it would become more commonly referred to. On April 23, 1985, Coca-Cola did what by any measure today would appear to be pure brand suicide – it took its flagship product, arguably the most beloved soft drink on the planet, and completely revamped it.

To put this into context, imagine… well, herein lies the ludicrous scale of this maneuver: when imagining an indelible brand seemingly beyond the scope of compromise, the mind of even a novice marketer instinctively wants to turn to Coca-Cola. The brand is as much legacy as it is institution, since it’s creation by John Pemberton as a medicinal elixir in 1886 to its rise as the second most recognizable term in the world (“OK” is number one).  Coca-Cola is as synonymous with 20th Century, new world tradition as baseball, hot dogs, and television. To change the formula would be like arguing a pantsuit for Lady Liberty.

Newcokebottle2

Well, maybe not.

To be fair, when Goizueta took over as CEO in 1980, there was a lot for Coca-Cola to be worried about. The Cola Wars were in full swing, and PepsiCo had gained the upper hand. Halfway through the 20th Century, Coca-Cola had held the lion’s share of the soft drink market, but by 1983, it commanded less than a quarter. The younger demographic had migrated to Pepsi, with its sweeter flavor and lifestyle marketing campaigns (Pepsi rarely focused its advertising on its products, instead showcasing who drank them; this was a marketing first and major boon for PepsiCo). Goizueta, an aggressive tactician who abhorred sacred cows, well knew Coca-Cola had to embrace Pepsi as a viable usurper to its throne and meet this challenge head on with a drastic strategy.

Goizueta enlisted the support of Coca-Cola President, Donald Keough, as well as marketing vice-president Sergio Zyman and Coca-Cola USA President, Brian Dyson. An assertive marketing research campaign was launched involving taste-testings, focus groups, and surveys. And overwhelmingly what the results of the campaign showed were that people liked the taste of Coke’s new formula over both Pepsi and original Coca-Cola. Additionally, surveys showed people, for the most part, were open to the idea of drinking the new beverage, even if it were labeled “Coke.” The focus groups, on the other hand, weren’t as unilateral in conclusiveness. A small minority scoffed at the idea of altering Coca-Cola, which sparked peer-pressure resonance within the group dynamic. This, however, was widely ignored. Coca-Cola brass was confident in the taste test results and moved forward with release of “the new taste of Coca-Cola.”

Upon its initial release, New Coke did very well. Sales had risen from the same time the previous year, and surveys continued to show a substantial majority favor for New Coke. Of course, these were major metropolitan demographic results… not the South.

Coca-Cola was born in the Southeast, in the wake of defeat at the hands of the Union. Coca-Cola held a virtually unparalleled reverence throughout the region, and its perversion was considered sacrilege. That vocal minority from the focus groups had found its spawning ground, and from this nest it bred like wildfire. Disapproving letters and phone calls came pouring in. Critics began lambasting Coca-Cola executives for their carelessness in underestimating their customer-base’s loyalty. Pepsi fired back with its own advertising campaign questioning Coca-Cola’s motives. And even internal murmurs of dissatisfaction with the reformulation began to surface, prompting the question of a possible reintroduction of the old formula not even two months after New Coke’s release.

But perhaps no bigger component pressured Coca-Cola’s reversal decision than its own bottlers. Long entangled in a pricing feud – that at the time included litigation – Coke’s bottlers had become increasingly frustrated with the public’s alienation from the company. While Coca-Cola Company made the concentrate for Coke, the individual bottlers still had to produce, distribute, and merchandise Coca-Cola within their respective regions. In the South, this had become a challenge with so many consumers staunchly refusing to buy Coke – if not dump it on the ground in a show of defiance. Facing a major boycott from its bottlers, Coca-Cola had to concede defeat… to itself. The original formula would return to market.

On July 10, less than three months after the introduction of New Coke, Coca-Cola announced the heralded return of original Coke, dubbed Coca-Cola Classic. To say this merely stalled irrevocable damage would be a vast understatement. The return of Coca-Cola Classic rocketed company sales past Pepsi and reestablished Coca-Cola as the dominant force in the soft drink market. This quickly led to speculation that New Coke’s introduction and swift dismissal was an elaborate marketing ploy to reaffirm Coke’s value within the public arena. An amazing conspiracy, if it weren’t for the fact that New Coke wasn’t so readily dismissed.

While multiple product lines has become de rigueur in today’s diversified market, positioning two high-calorie soft drink beverages in a field recently divided by the advent of diet soda was a formidable task in 1985. But Goizueta and his team stood by their new product. It retained only a North American presence, but production continued until 2002 (New Coke was renamed Coke II in 1992). The beverage, however, was largely ignored by both consumers and corporate marketing. The soft drink that had found unanimous acceptance during its test phase died a slow and caustic death.

Despite what was seen as a monumental blunder by one of the most lauded corporations in the world, no blame was cast upon any one individual at the Coca-Cola Company. Simply, there was no one to blame. Marketing researchers have puzzled for years over one of the greatest missteps in free market history – how could a company as infallible as Coca-Cola make such a colossal mistake as tampering with their star product? Well, how did the stock market – with all its fancy, new computer hardware and mathematician brokers – crash only two years later? The Invisible Hand of economics revealed itself as the emotional unpredictability of consumerism during the height of the Cola Wars. If people loved Coca-Cola so much, why were sales down at the start of the decade? No one asked. The epic failure of New Coke was also the sweeping revitalization of Coca-Cola Classic. The power elite at Coca-Cola were happy enough to wipe the sweat off their brows and forget the whole thing ever happened.

Although that’s not entirely true, either. Its universal scorn notwithstanding, New Coke did maintain at least one loyal drinker for twelve years. Robert Goizueta continued to drink New Coke until his death in 1997.

“The moment avoiding failure becomes your motivation, you’re down the path of inactivity. You stumble only if you’re moving.”

Robert Goizueta

Juicy Details

If you’re anything like me then it doesn’t take a whole lot to jog your memory and find yourself frozen on a familiar street, in a store, or with an old friend, reminiscing over some vague image from childhood suddenly stuck in your amygdala. Without notice, products, people, and places play out like scenes from what ought to be a “classic” film you remember from youth. Except this is your movie. And it’s boring. Because it’s just a carton of juice. Bruce Willis isn’t shooting anyone. (If he did, your thoughts are actually Post-Traumatic Stress, and you should seek help. See previous post.)

Getting back to the innocuousness of juice, every so often – out of nowhere – I find myself thinking of Five Alive. For those unfamiliar with the beverage, Five Alive is a citrus juice drink created by the Coca-Cola brand, Minute Maid. The “Five” represents the five fruit flavors in the drink. There has been a total of seven varieties, but the original was a blend of orange, lemon, grapefruit, tangerine, and lime. I have no idea what this combination tastes like; I’ve never had Five Alive. The memory I have of this product is entirely visual, etched into my psyche from a passing glance in a grocery store some 22 years ago.

Here it is in its simple, dated glory.

5Alive80s

Minute Maid totes Five Alive as a “family” beverage that you can “enjoy all day long.” But for me, Five Alive was always a beverage other families enjoyed. That’s not to say it was better or worse than what my family drank (admittedly I started on coffee around three – which upon reflection is markedly worse). Yet despite my avoidance, this carton of what sounds like pure acid continues to wrest my imagination.

Perhaps it’s a lost association. If I didn’t drink Five Alive, who did? My aunt and her kids? My mother stocked the kitchen and fridge with what appealed to only her palate, and everyone in the house had to follow suit. Visiting friends and family always led to something of a discovery as a kid, opening their fridges and learning what variations in grocery choices existed outside of mine. But I don’t recall seeing Five Alive in any refrigerator. Or seeing anyone swig from a bottle of it on a hot summer day.

Although apparently someone did.

Although apparently someone did.

Maybe it’s just the carton itself. After all, a line of big royal blue boxes uniformly resting in the refrigerator aisle, eye-level with a sprouting eight-year-old, is rather mouthwatering (look at the Hi-C juice box above; I feel like I just licked a salt mine). Is Five Alive’s indelible legacy a result of nothing more than great product design? Hey, good for Minute Maid, if so. It’s a great example of brand positioning beginning with effective packaging. The carton made Five Alive one of those somewhat obscure supermarket staples I always wanted to like, but never tried, similar to Underwood’s Deviled Ham, and that weird peanut butter and jelly that comes in one jar.*

While relatively popular in the U.K. today, Five Alive’s accessibility in the United States is limited. How it fell into reticence is anyone’s guess. Here’s a modern image of the drink.

five alive

five alive (Photo credit: ..tmh)

 

 

 

 

 

 

 

I’m not sure why it’s on fire here – maybe this is how it feels when you pour it over a paper cut. Regardless, that old blue carton continues to stand out in visions of antiquity. Perhaps it persists in my thoughts as a combination: part mystery, part visual beauty, part lure toward emotional introspection – it’s more than revved my historical engine while I have been writing, and I’m reminded of another juice drink from childhood.

What ever happened to Veryfine (I know; Sunny Delight owns the brand now)? I loved the old glass bottles you could once get. I also loved Veryfine because it lent itself so well to the self-aware cheesiness of pickup lines… think about it.

Veryfine

For the record, every drink tastes better out of glass.

*Smuckers makes a product called “Goobers” that blends peanut butter and jelly. I can’t recall if this is the exact product I remember from the 80s.

veryfine