The Coca cola vs. Pepsi rivalry has been a legendary one. The rivalry dates back to the early 1980s. It was actually ignited in 1975 with a Pepsi challenge. This challenge resulted in a sudden and horrific Coca cola’s failure. This war has since raged on for over a century. The competition from Pepsi was so strong that Coca cola’s market shares had declined from a comfortable 60% after the Second World War to a merely surviving 24% by 1983. Pepsi-cola Company was so determined that they were able to outsell their competitor in the supermarkets. As a result, Coke was forced to heavily rely only on vending machines and sales in fast food restaurants. Coca cola also had bought themselves pouring rights to provide drinks in sports venues. During the time of Coke dominance, the consumers were more conscious of their health and weight issues as they grew older thereby favoring the Diet Coke. The young population on the other hand, preferred the sweetness of Pepsi. While Coke had enjoyed market dominance prior to the Second World War, Pepsi had started to position itself strategically for the youth market. This strategy started back in the 1960s.
Coca Cola Company became desperate to counter the competition from Pepsi. The company executives had decided that the best way to match this competition was to reformulate their product by ensuring it was sweeter and tasted better than that of their competitor. As a result, the Coke Company had launched a project known as project Kansan. This project was given the responsibility of coming up with a formula that would ensure a sweet tasting coke. For the project, things seemed to be working getting the much needed results. First, the coke marketing department carried out a number of surveys on the taste test in the United States. The results of the survey were positive. The newly formulated mixture had beaten both the original Coke and Pepsi. It tasted sweeter than them. In fact, most of the people surveyed were willing to buy and drink it were it coca-cola. A small number, however, felt angry and threatened to stop buying coke. This small percentage however, was not to be taken for granted. Their presence was likely to influence the other positive participants. This survey played a significant role in convincing the Coca-Cola Company management to implement the formula change.
The management Coca-Cola accepted the new formula but was so keen not to sell it as a new and separate variety from the original coke. This new variety would as well compete with the original variety thereby giving advantage to Pepsi. Coke planned an announcement on the 23rd April 1985. Subsequently the company introduced the New Coke on the said date. This was considered as a major threat by the Pepsi management who did not waste time in response. Pepsi traded another war by printing in one of the dailies that Pepsi was the eventual winner of the long standing Cola Wars. Things even got worse for coke after their planned announcement when Pepsi went public to announce that the action is an indication that coke had admitted defeat.
This introduction of new coke would later prove disastrous to the company. Some of the consumers were angered by the replacement of the original formula of the classic coke. Some of them had hated the new variety even before the tasted it.
Coke must have learned a painful lesson from the survey they had carried out concerning the taste test. Their statistics had shown that around 10% of the people would not be satisfied with the reformulation yet they went ahead with its implementation. The disaster suffered by the company after the introduction of this new variety had been predicted in the statistics. Surveys should give a guideline. Hence the findings of any survey should be applied and not ignored. Ignoring survey findings hamper a project implementation. If for example, the sample size is 100000 people, 10% would be the sum of 10000 which is such a large part of the population to be ignored.
Having interviewed their customers, coke did not react appropriately to their customers’ interest. While their existing customers preferred the diet coke, the company chose to go for taste. They did not put into consideration the consumer preferences. As a result, the company received complaints and dissatisfaction messages, messages that expressed their anger and disappointment in the company and the executive. A company that fails to listen to satisfy its consumers is seen to have lost direction and that is exactly where coke was headed. They should have given a close consideration to the views in the survey. However much the company wanted to compete with Pepsi, the best approach might have been to come up with a formula that took into consideration health and weight issues while at the same time ensuring sweetness.
From the events in this cold war between coke and Pepsi, it can clearly be seen that consumers are the core of any market. The products should only be branded and formulated to satisfy their interests. In the same line, it is also important to clearly know the size of the market before formulating a product. For instance the products for different gender would be formulated separately; the same applies to age and occupation. In the cola war, Pepsi had clearly defined the youth as their market and were able to produce their most favored product. Conversely, Coke did not clearly know who their intended consumers were. As a result, Pepsi was able to outsell them.

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