Inside the Framework -- and Fallout -- Behind New Coke
Sergio Zyman, the charismatic former chief marketer of Coca-Cola, was behind some of the company's most successful advertising -- "Coke Is It!" and "Always Coca-Cola" -- and his tenure coincided with two defining launches, Diet Coke and New Coke. At one time called the "enfant terrible of marketing" and dubbed the "Aya-Cola" because of his intense management style, he served two stints at the company, from 1979 to 1986 and from 1993 to 1998. But it was his 77 days in 1985 between the launch of New Coke and the return of the real thing that serve as one of the most interesting case studies in the annals of marketing.
Coca-Cola is a company not historically inclined to major changes or strategy shifts. Some inside the company fought the launch of Diet Coke, the first trademark extension because "they believed that Coke was one thing, one sound, one size, one taste," Mr. Zyman said. "Coke is Coke is Coke is Coke."
But Diet Coke's successful launch gave the company a new mind-set, and three years later, as it prepared to launch New Coke, "the company was willing to change everything," he said. New Coke was a dramatic move aimed at stemming market-share losses, something advertising in the years leading up to New Coke, including "Have a Coke and a Smile" and the iconic ad "Hilltop," couldn't seem to reverse, said Mr. Zyman.
"What we saw was an increase in awareness, an increase in feeling good about what the company was," he said. "They were great ads, but that 's what they were: ads. Not really good marketing tools. … In those days, advertising was really the only element of marketing. You put an ad on the air, consumers liked it, everybody writes about it, the bottlers felt happy, and there was nothing else."
In advance of New Coke, Mr. Zyman says the company ramped up ad spending, doubled price promotion and employed deep discounts -- to no avail. "The only thing left was to change the product or change the advertising," he said.
"I think we were lazy in really recognizing that we needed to reactivate or reposition the brand. If we had done that through an advertising process, I don't think New Coke would have ever happened, but there was such resistance to any kind of change in the advertising position of the brand that we introduced a change in the taste," Mr. Zyman said. "I know, you'll say that 's ridiculous, and I agree. But it happened."
What ensued is one of the most intriguing marketing case studies in history as Mr. Zyman and a host of other Coca-Cola executives worked around the clock for two-and-a-half months trying to right the New Coke mistake. By the end of it, "I couldn't even hold a glass in my hand I was so tired," Mr. Zyman said.
Today Mr. Zyman resides in Florida, serving as a private adviser to a few CEOs and "trying to fix" his "damn golf game." He says he counts himself lucky to have been a "part of some very important things." And at the top of that list was being one of the people that tried "to change the ways of the Coca-Cola Co."
He doesn't harbor any secret desires that people would just forget about New Coke already. "I think New Coke was a seminal moment for the Coca-Cola Co.," he said. "New Coke kind of shook the company up." Asked whether New Coke was a failure or a success, Mr. Zyman responded immediately. "A success. Are you kidding me?"
In an interview with Ad Age , Mr. Zyman recalled those days between the New Coke launch on April 23, 1985, and the reversal on July 10, 1985. This is an edited excerpt from the interview:
I was sitting in Atlanta. I was manning the press conference while Roberto was in New York, and a reporter said, "What if it doesn't work?" and Roberto said, "You don't understand -- it's going to work." I turned around and said, "Oh, man, the press is going to kill us." And, sure enough, by the next day we knew we were in trouble.
Eleven days later [I was working] on the return of Coke, coming up with something. I actually had to do a speech in Europe, so I called all the people, the packaging companies, strategy, and everything to Monte Carlo which is where I was giving my speech. I went overseas because I didn't want to get caught here in the U.S. [working on the return of Coke].
As we looked at the can we said, "We've got to overdo it. We've got to say to consumers this is the original." We tried Coca-Cola Original, Coca-Cola No. 1, just plain Coke. I actually still have a lot of the mockups. But Classic was the one that was the best. It said we're not fooling around. This is it. (The brand would be called Coca-Cola Classic until 2009.)
[At one point] we were on a company plane and [President] Don Keough turned around to me and said, "Are you doing something?" and I said, "I am, sir," and I got up and went to the back of the plane. That was the only time I said anything, because I couldn't say anything. We could not say publicly to anybody that we had questions or doubts about the fact that New Coke was a great success. Every day we had a million interviews and said this is going to be fantastic. That was a lie.
The next two months we were kind of managing the depression that the system had about the fact that the greatest thing since sliced bread wasn't working. We eventually got to the point where management and everybody decided we needed to bring [the original formula] back to appease those people who weren't happy. Peter Jennings announced it. And that night the return of Coke made the news on all three networks.
It was very exciting at the beginning, because all of a sudden we had almost a rebirth, a renaissance of the brand. Consumers were looking at it and business was booming. Consumers wanted the brand; they appreciated the brand; they knew what the brand was all about. And it was a great opportunity for us to actually reformulate the overall proposition of the brand. But the system was very tired, the bottlers were very tired. Remember, a bottler is in a small community. They were attacked by their neighbors. People in the golf club made fun of them and all that . They wanted a break. So the company lost focus again. I got very frustrated, and I left the company. (Mr. Zyman returned in 1993 as chief marketing officer for Coca-Cola.)