Monday, April 11, 2011

Story of Failure Turns to Success: New Coke

During 1985 (in an attempt to reverse it's 20 year market decline against its rival, Pepsi) Coca-Cola stopped selling their original soft drink and completely changed it's formula, offering it simply as The New Taste of Coke.

And everyone hated it.

Sergio Zyman (the man behind the plan) ended up costing Coca-Cola almost $100 MILLION.

Coca-Cola's original formula had been around for almost 100 years. Everyone loved it - and nobody was happy when it changed.

Robert McMath (Coca-Cola's marketing consultant) referred to this as one of the greatest product failures of all time.

And Sergio Zyman left the company.

Years later, he is asked whether he thinks this blunder was a mistake. His answer...

"No, categorically."

Wait a second. He angered millions of people, cost the company he worked for millions of dollars, and lost his job. How could this not be a mistake? A bust?

Zyman says, "Another word between 'bust' and, uh, something else."

"Now, if you say to me, 'The strategy that you guys embarked on didn't work', I'll say, 'Yeah, absolutely it didn't work.' But the totality of the action ended up being positive."

Yep. Zyman's suggestion to change the Coke formula (though causing a lot of people to get pretty upset) did, in fact, make the company's return stronger in the end as it led to the production of Coca-Cola Classic - a drink that became even more popular. Roberto Goizeuta (late chairman and chief executive of the Coca-Cola company) confirmed this and actually rehired Zyman in 1993.

"Judge the results." Goizueta says, "We get paid to produce results. We don't get paid to be right."

Zyman's plan was a tough one. Using the same brand for almost a century and then just suddenly changing it? The strategy obviously didn't go the way he hoped, but it all worked out in the end. The moral of this story: don't let failure (or the fear of failure) keep you from achieving your goals.

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Resource: Failing Forward (John C. Maxwell)

1 comments: until now.

Blogger + November 5, 2016 at 4:10 PM (#) :

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