How New Coke Went From Market-Changer to Company's Humbling Biggest Blunder
Still smarting from the "Pepsi Challenge" taste-test battle and facing declining market share, Coca-Cola launched "Project Kansas," a top-secret mission to reformulate Coke. A sweeter version of the flagship cola prevailed and agency McCann Erickson was brought on board to develop marketing behind the April 23, 1985 launch. Marcio Moreira, now vice chairman at McCann Worldgroup, was one of a core group of the agency's execs clued in to the stealth project. Ad Age asked him to reflect on the launch that would come to be known as one of marketing's biggest blunders.
Diet Coke just surpassed regular Pepsi; Coke Zero is a major success; Coca–Cola stock is doing very well, thank you -- all of which means a risk-taking mindset remains a sound strategy. You would have been hard-pressed to reach this same conclusion in 1985 when, just as Coca-Cola was poised to celebrate 100 years, U.S. bottlers were told that a new formula of the world's most successful soft drink was about to be launched.
Big day in Atlanta! Not only was New Coke being introduced, it was replacing Coca-Cola as we knew it. Pepsi was making inroads with its ever-evolving, ever-sweeter formula, meaning maybe it was time to revisit Coke's never-changed secret formula.
At McCann, we were asked to set up a secret "Bunker" where a small number of professionals would meet, overseen by key Coca-Cola executives. John Bergin, Barry Day, Bill Thompson and I went incognito first; followed later by Ira Madris, Bruce Nelson and others.
Ike Herbert, chief marketing officer, and Sergio Zyman, senior VP-marketing, led the Coke team, working from research that contrasted the performance of the new formula and the classic formula vs. Pepsi. The research said it was a go. To their credit, our client had the chutzpah to proceed with the innovation. But consumers' reaction to New Coke actually replacing Classic Coke was never sufficiently explored.
Following extensive strategic and creative debate, "Bunker 1" members, securely ensconced on a floor at 755 Third Avenue in Manhattan, were asked to go out and shoot the approved lifestyle imagery. "Bunker 2," newly established in my hotel room in London, was asked to obtain the ultra-sensitive product footage, using the hot-off-the-presses half-dozen prototype New Coke cans, which were flown in to me by Concorde.
The box with the prototypes got through British Customs without a hitch. Cannes Grand Prix-winning director Julian Cottrell -- bless him -- proceeded to shoot the newly-minted cans thinking that "new" meant Coke was introducing a "new tin."
One day, just as we were expecting Sergio to Concorde in for a progress meeting (starring role: the new cans!), I returned to my room to find the box gone! Following an expletive-laden exchange, the front desk told us a very efficient chambermaid thought they were "empties" and got rid of them. Talk about panic. Visions of our precious cans showing up on the front page of various English tabloids; our global project blown sky high!
My production team and I spent several hours emptying rubbish containers at the back of the hotel until we found our box, about to be mangled by the garbage compactor. Luckily, we still had four useable cans -- Sergio never asked for the other two -- and the rest is history.
Post-production was no walk in the park. Client and agency joined forces in "Bunker 3," at Horn & Eisenberg's editing facilities in midtown Manhattan. I remember we were cutting and strategizing at the same time. Long nights, new thoughts -- "let's go get Bill Cosby!" "What did we learn from the invasion of Normandy?" -- until we were ready to roll.
Everyone knows how the story ended. On July 10, 1985, my hero, Coca-Cola President Don Keough, talked about a "lesson in humility" and refuted the notion of New Coke being a stunt by saying: "We are not that dumb, and we are not that smart."