welcome back to segment three of hit
module number 29 I’m joined here with
Harold Simkins professor marketing at
Concordia John Wilson School of Business
so April 23rd 1985 coca-cola to
celebrate its 100th year anniversary
decides to basically launch new coke
mm-hmm so take us through that the
thinking the launch the aftermath wasn’t
a mistake was it not a mistake who got
the last laugh and maybe the biggest
failure in the biggest success in
marketing history probably both how so
the story goes that in the soft drink
market now today it’s still the case but
back then it was even more so your two
leading players Coke and Pepsi tasted so
similar to each other that the
advertising didn’t talk about the
product that talked about the brand and
that’s the way the industry was that was
conventional wisdom was that’s the way
it was almost going to be but what Pepsi
had been doing over a period of time was
was improving the taste of their product
relative to cope so they got to a point
where in blind taste tests the majority
coke drinkers preferred the taste of
Pepsi and then they advertised that and
Pepsi’s market share started to escalate
I don’t know a Pepsi ever overtook cope
as the number one software in the States
but it came close coke then reformulated
its product so that in blind taste tests
it tasted better than pepsi so now the
decision came through ok what do we do
do we just advertise now that we taste
better than pepsi as a number one brand
you don’t really want to identify your
competitors you probably noticed with
competitive advertising is usually the
number two or number three brand that
identifies the competition do we talk
about new in
true why don’t we just shake things up
completely and discontinue coca-cola as
we know it in the red and white can and
introduce new coke this 100th
anniversary and there’s as big big big
news and it really was headline news so
they did it and they started losing
users more quickly than ever before and
I remember seeing man on the street and
women on the street interviews and
especially in the States and people
saying this stuff tastes horrible and
you know other people saying you know
everything’s changed you know the world
is changing you know USB my boss was a
man now my boss is a woman back in the
day right but at least one thing I could
almost rely on was coming home opening
the fridge my coke would be there and
now they’ve gone and changed that and by
the way they’ve made it worse it was
interesting lying face test New Coke was
rated number one Pepsi number two old
Coke number three but when people were
shown the brand Pepsi was rated sorry
old Coke was number one Pepsi number two
New Coke number three so the only
difference was people knowing what the
brand is and so what we saw there was a
really strong brand attachment but
there’s all kinds of brain scanning
research has gone on since that when
people see brands that like Coke to
certain parts their brains kind of get
excited coke made a momentous decision
in in a in a crisis situation which was
will bring back the old Coke and call it
coke classic what looked like a horrible
mistake now turned in to a piece of
genius marketing because you know one of
the big battles with soft direct
marketing is the battle for shelf space
so now they have the new co the co
classic fighting Pepsi stay at two
brands now fighting Pepsi so in some
stores they actually doubled their shelf
space and their sales grew like they’ve
never grown before and I recently heard
the president
the former president of coca-cola
interviewed about that whole thing
because there is some talk about their
that was like a conspiracy theory that
they planned this all along right it was
all planned right they’re gonna do it
see America get really upset and then
bring back the original quote and he
said you know we weren’t that stupid and
we weren’t that smart and and it’s an
example of them kind of being stupid
then being smart and recovering from
what seemed to be a disaster it’s funny
because when the cuban-american CEO
Robert goes wet retired he went down
along with Jack Walsh was one of the
greatest managers and this was on his
watch and when you read the quote and I
was researching this he remained as you
know Bravo you know ballsy as ever he
was like no this was not a mistake we
succeeded it was a big success and
you’re right in the end I think it
helped them more than anything else were
there how much of that sort of impacts
the fact that coca-cola was this sort of
grand you know icon of Americana and how
much of it was the product itself
because like there’s like what’s the
brand it is as I trying to show with the
taste test even though the product
tasted the monster will be better than
the old product and then the Pepsi
hidden when the prompt when the brands
were shown when they actual cans were
showing people saw the new practice
tasting worse than the other Tim last
question so nowadays with with you know
each year I think you have interbrand
they come out with their list of top
brands and you’ve seen now the company’s
zooming to the top Apple Google and
that’s not surprising I mean apples the
most valuable company in the world but
how does the internet and social media
and all this stuff like how does this
really change the branding challenge
does it really make it easier because
you got the internet as this new media
does it make it harder because there’s
so much more clutter like you must even
like you I for sure your your class
curriculum is not the same that it was
you know forget ten years ago even five
years ago so let’s say if I were to come
to you and say I have this problem how
does the PlayBook change or do you even
not have a playbook there’s no change
because by the time you write the
PlayBook it’s obsolete I mean social
networking is how will three years old I
mean yeah in the context of North Korea
were the old chat rooms and there is n
and all I stuff but in the context that
we know what now it’s not that no social
media is relative or five years that
agencies internally so on one hand and
the promise of the internet well
targeted advertising and being able to
measure roi right because you could
track people’s behavior has it worked it
that way and the answer is sort of it
hasn’t worked out the way I think a lot
of people let’s say 10 15 years ago I’m
not 10 15 5 10 years ago thought it
would work out we’re dealing with
enormously fragmented audiences so the
one thing that online still has a
challenge doing is bringing big numbers
yet we know for sure the Super Bowl is
going to get to 100 million pairs of us
eyeballs so that’s one thing a second
thing is you kind of lose control the
message and you can lose control what’s
being said about you and managing that
has become a challenge but you know in
the old days when I worked in the
advertising business when I was a
product manager you know you spent most
of your year working on the research and
then the production of your new TV
commercial then we’re working with your
agency on the media by that’s only now a
small portion of what marketers prettily
b2c marketers are working with they have
to do with the PR component the direct
marketing component the online component
and the online component from the
standpoint of display advertising PP
pay-per-click advertising social
networks and i’ll email mark email
marketing as opposed to the other type
of direct marketing the stuff is done by
the post office and whatever and it’s
all changing so quickly you know one
thing i’m kind of sensing is we’re
moving away a little bit from big idea
everett big ideas to run a campaign for
a year or two or three to a whole bunch
of smaller ideas jerk reactions but you
just change them frequently frequently
free you will take that the great viral
campaign the
your man could smell like for Old Spice
by but by P&G what did that campaign say
what was the message me with X we know
the messages you’re a nerdy young guy
spray some axe on I think to me was the
equivalent of the old saw your uncle’s
or father’s Oldsmobile that old spice is
injured yeah but it didn’t anything
about the product no but it helped sales
I wrote an article where I was going to
say look in the end it didn’t move the
needle but it actually did it did I
don’t know if it’s a long term effect or
short term but then the question becomes
I think that’s more of a tactical
campaign the strategic campaign so what
are you followed up with and anything
anywhere near as powerful what they do
okay so I lied this is the last question
because you hit on something this whole
idea of like niche marketing narrowband
targeting are we going down the wrong
path as marketers that you know like we
always talked about this you know mass
media is old television wrong but the
biggest advertisers like proctoring
animal they don’t really care about
targeting like they want everybody by so
let’s say so they you know is his niche
and Oasis is targeting is it love / hate
him you gotta respect PNG you know that
they’re the easiest company for me to
use in my classes of foreign teams for
examples of how to do things right in
the area of marketing they’re going on a
massive massive cost-cutting campaign
break down company wide and what do they
what do they need all that money to do
online and social network marketing it
was two years ago they did a test in
Canada where they spent twenty percent
of their integrated marketing
communications budget strictly out in
that area I believe it was a success the
idea was the tested in Canada and take
it globally but when you see Procter &
Gamble becoming active in that area
investing hundreds of billions of
dollars in it you can be pretty sure
that that’s where the action is going to
be that’s where the action is good stuff
right sir thank you very much for
joining us in the studio Harold Simpkins
professor marketing at Concordia John
Wilson School of Business that’s been
hit ball Joel number 29 see you next
week
module number 29 I’m joined here with
Harold Simkins professor marketing at
Concordia John Wilson School of Business
so April 23rd 1985 coca-cola to
celebrate its 100th year anniversary
decides to basically launch new coke
mm-hmm so take us through that the
thinking the launch the aftermath wasn’t
a mistake was it not a mistake who got
the last laugh and maybe the biggest
failure in the biggest success in
marketing history probably both how so
the story goes that in the soft drink
market now today it’s still the case but
back then it was even more so your two
leading players Coke and Pepsi tasted so
similar to each other that the
advertising didn’t talk about the
product that talked about the brand and
that’s the way the industry was that was
conventional wisdom was that’s the way
it was almost going to be but what Pepsi
had been doing over a period of time was
was improving the taste of their product
relative to cope so they got to a point
where in blind taste tests the majority
coke drinkers preferred the taste of
Pepsi and then they advertised that and
Pepsi’s market share started to escalate
I don’t know a Pepsi ever overtook cope
as the number one software in the States
but it came close coke then reformulated
its product so that in blind taste tests
it tasted better than pepsi so now the
decision came through ok what do we do
do we just advertise now that we taste
better than pepsi as a number one brand
you don’t really want to identify your
competitors you probably noticed with
competitive advertising is usually the
number two or number three brand that
identifies the competition do we talk
about new in
true why don’t we just shake things up
completely and discontinue coca-cola as
we know it in the red and white can and
introduce new coke this 100th
anniversary and there’s as big big big
news and it really was headline news so
they did it and they started losing
users more quickly than ever before and
I remember seeing man on the street and
women on the street interviews and
especially in the States and people
saying this stuff tastes horrible and
you know other people saying you know
everything’s changed you know the world
is changing you know USB my boss was a
man now my boss is a woman back in the
day right but at least one thing I could
almost rely on was coming home opening
the fridge my coke would be there and
now they’ve gone and changed that and by
the way they’ve made it worse it was
interesting lying face test New Coke was
rated number one Pepsi number two old
Coke number three but when people were
shown the brand Pepsi was rated sorry
old Coke was number one Pepsi number two
New Coke number three so the only
difference was people knowing what the
brand is and so what we saw there was a
really strong brand attachment but
there’s all kinds of brain scanning
research has gone on since that when
people see brands that like Coke to
certain parts their brains kind of get
excited coke made a momentous decision
in in a in a crisis situation which was
will bring back the old Coke and call it
coke classic what looked like a horrible
mistake now turned in to a piece of
genius marketing because you know one of
the big battles with soft direct
marketing is the battle for shelf space
so now they have the new co the co
classic fighting Pepsi stay at two
brands now fighting Pepsi so in some
stores they actually doubled their shelf
space and their sales grew like they’ve
never grown before and I recently heard
the president
the former president of coca-cola
interviewed about that whole thing
because there is some talk about their
that was like a conspiracy theory that
they planned this all along right it was
all planned right they’re gonna do it
see America get really upset and then
bring back the original quote and he
said you know we weren’t that stupid and
we weren’t that smart and and it’s an
example of them kind of being stupid
then being smart and recovering from
what seemed to be a disaster it’s funny
because when the cuban-american CEO
Robert goes wet retired he went down
along with Jack Walsh was one of the
greatest managers and this was on his
watch and when you read the quote and I
was researching this he remained as you
know Bravo you know ballsy as ever he
was like no this was not a mistake we
succeeded it was a big success and
you’re right in the end I think it
helped them more than anything else were
there how much of that sort of impacts
the fact that coca-cola was this sort of
grand you know icon of Americana and how
much of it was the product itself
because like there’s like what’s the
brand it is as I trying to show with the
taste test even though the product
tasted the monster will be better than
the old product and then the Pepsi
hidden when the prompt when the brands
were shown when they actual cans were
showing people saw the new practice
tasting worse than the other Tim last
question so nowadays with with you know
each year I think you have interbrand
they come out with their list of top
brands and you’ve seen now the company’s
zooming to the top Apple Google and
that’s not surprising I mean apples the
most valuable company in the world but
how does the internet and social media
and all this stuff like how does this
really change the branding challenge
does it really make it easier because
you got the internet as this new media
does it make it harder because there’s
so much more clutter like you must even
like you I for sure your your class
curriculum is not the same that it was
you know forget ten years ago even five
years ago so let’s say if I were to come
to you and say I have this problem how
does the PlayBook change or do you even
not have a playbook there’s no change
because by the time you write the
PlayBook it’s obsolete I mean social
networking is how will three years old I
mean yeah in the context of North Korea
were the old chat rooms and there is n
and all I stuff but in the context that
we know what now it’s not that no social
media is relative or five years that
agencies internally so on one hand and
the promise of the internet well
targeted advertising and being able to
measure roi right because you could
track people’s behavior has it worked it
that way and the answer is sort of it
hasn’t worked out the way I think a lot
of people let’s say 10 15 years ago I’m
not 10 15 5 10 years ago thought it
would work out we’re dealing with
enormously fragmented audiences so the
one thing that online still has a
challenge doing is bringing big numbers
yet we know for sure the Super Bowl is
going to get to 100 million pairs of us
eyeballs so that’s one thing a second
thing is you kind of lose control the
message and you can lose control what’s
being said about you and managing that
has become a challenge but you know in
the old days when I worked in the
advertising business when I was a
product manager you know you spent most
of your year working on the research and
then the production of your new TV
commercial then we’re working with your
agency on the media by that’s only now a
small portion of what marketers prettily
b2c marketers are working with they have
to do with the PR component the direct
marketing component the online component
and the online component from the
standpoint of display advertising PP
pay-per-click advertising social
networks and i’ll email mark email
marketing as opposed to the other type
of direct marketing the stuff is done by
the post office and whatever and it’s
all changing so quickly you know one
thing i’m kind of sensing is we’re
moving away a little bit from big idea
everett big ideas to run a campaign for
a year or two or three to a whole bunch
of smaller ideas jerk reactions but you
just change them frequently frequently
free you will take that the great viral
campaign the
your man could smell like for Old Spice
by but by P&G what did that campaign say
what was the message me with X we know
the messages you’re a nerdy young guy
spray some axe on I think to me was the
equivalent of the old saw your uncle’s
or father’s Oldsmobile that old spice is
injured yeah but it didn’t anything
about the product no but it helped sales
I wrote an article where I was going to
say look in the end it didn’t move the
needle but it actually did it did I
don’t know if it’s a long term effect or
short term but then the question becomes
I think that’s more of a tactical
campaign the strategic campaign so what
are you followed up with and anything
anywhere near as powerful what they do
okay so I lied this is the last question
because you hit on something this whole
idea of like niche marketing narrowband
targeting are we going down the wrong
path as marketers that you know like we
always talked about this you know mass
media is old television wrong but the
biggest advertisers like proctoring
animal they don’t really care about
targeting like they want everybody by so
let’s say so they you know is his niche
and Oasis is targeting is it love / hate
him you gotta respect PNG you know that
they’re the easiest company for me to
use in my classes of foreign teams for
examples of how to do things right in
the area of marketing they’re going on a
massive massive cost-cutting campaign
break down company wide and what do they
what do they need all that money to do
online and social network marketing it
was two years ago they did a test in
Canada where they spent twenty percent
of their integrated marketing
communications budget strictly out in
that area I believe it was a success the
idea was the tested in Canada and take
it globally but when you see Procter &
Gamble becoming active in that area
investing hundreds of billions of
dollars in it you can be pretty sure
that that’s where the action is going to
be that’s where the action is good stuff
right sir thank you very much for
joining us in the studio Harold Simpkins
professor marketing at Concordia John
Wilson School of Business that’s been
hit ball Joel number 29 see you next
week
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