Sunday, January 23, 2011

The history of new coke

Hello friends! The following is an interesting story that I was told by...well let's just say a role model of mine.

Today, in my generation at least, everyone knows coke and Pepsi as the two largest cola companies (major conglomerates aside, I'm just talking beverages here). Typically we make our decision as consumers while standing in front of both of them looking at the price tags. Ok, ok, besides the odd person who goes out of their way to purchase one product over the other, people will generally buy the one that's on sale. That's how we know it today: Pepsi vs. Coca-Cola "Classic". Well, what does that 'classic' stand for anyway?

Coca-cola always held a pretty strong grip on the cola market (at least in north America- I'm not sure about elsewhere). That is until Pepsi came along and began to steal a bit of their market share. Not much- about 20-30% apparently. Obviously coke didn't like this. Thus they created a product to compete with Pepsi, and called it "new coke".

If you are around my age you have no idea what new coke is. Apparently it is a coca cola product that pretty much tastes like Pepsi. This was a good strategy, right?- Create a product that is just like your major competitor's and, since you have been around longer, consumers will gravitate towards your product. The key here is that this was an age where the term 'price war' didn't really apply to beverages- it was an age of marketing based on quality of product (consult your nearest history of business text). As it turns out, people didn't buy the "new coke" that tasted just like Pepsi- instead they bought Pepsi. Coca-cola then decided to create "coca-cola classic"- and apparently the name stuck. Or so I'm told...

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