When Image Became Everything: The New Coke Fiasco At 25

Summer of 1985: Fidel Castro sits behind a transmitter and broadcasts a national radio address of monumental proportions: Cuba’s great American enemy to the north is in a state of decay. Though this statement came during the paranoid final years of the Cold War, Castro’s claim was not based on some clandestine CIA document smuggled by a double-agent. No, the proof of America’s decay, was that Coca-Cola tasted kind-of different.

A few months earlier, before an audience of 700 reporters seated in New York’s Lincoln Center, Roberto C. Goizueta, Coke’s president and CEO (and, fittingly enough, a Cuban ex-patriot) made his own national announcement: “The best has been made even better.” In non-PR lingo, Coca-Cola was changing its famous formula for the first time in nearly a century. “New” Coke, the notoriously ill-fated soft drink of the 1980s, (posthumously) turns 25 years old today.

“Some may choose to call this the boldest single marketing move in the history of the packaged-goods business,” said Goizueta at the press conference. “We simply call it the surest move ever made.”

Not sure enough. Goizueta was wrong. Like, very wrong. Like, “New Coke has become a universal synonym for corporate f***-up” wrong. Consumers not only rejected the taste of New Coke, they accused the Coca-Cola Company of no less than perverting an essential part of American culture. The public outrage that emerged has gone down as one of the great marketing blunders of the twentieth century.

And yet, while New Coke’s most legacy may be that of a multi-million-dollar blunder, the discontinued drink is far more than a cautionary tale of corporate hubris. It is a symbol of the unique cultural landscape of the 1980s — a time when Baby Boomers had jobs, kids, giant cell phones, and thirsts that, by God, needed quenching. A time when a Gilded-Age Atlanta soft drink like Coca-Cola struggled to stay relevant as MTV emerged and Wall Street redefined conservative America.

And what better way to stay relevant in the superficial ’80s than a literal reinvention of your trademark brand? Just as the classic Coca-Cola, with its Norman Rockwell ads and Bible Belt origins, represented America, New Coke represented ’80s America: flashy, new wave, quickly outdated, and brought to you by Bill Cosby:

The origins of New Coke trace back to the late 1970s, when Pepsi won a series of crucial victories in the Great American Cola Wars. The soft-drink competitor had already overtaken Coke on the supermarket front, and was advancing uncomfortably close toward Coke’s #1 spot on the coveted fountain market. By 1985, the Coca-Cola Company had lost an entire percentage point of its market share. (A percent being equal to hundreds of millions in the billion-dollar soft-drink industry, this was, to quote our Vice President, a big f***** deal.)

Pepsi’s Cola War coup was partly due to the “Pepsi Challenge,” a 1975 ad campaign televising blind taste tests that pitted Coca-Cola against Pepsi. In the ads, random consumers were presented with two anonymous samples of the competing soft drinks. After ceremoniously tasting each sample, the consumers would be asked which letter they preferred. They’d make their choice and, lo-and-behold, it was Pepsi! The Challenge “statistically” proved that Pepsi tasted better than Coca-Cola.

Of course, how scientific can any experiment that gives its participant free “I TOOK THE PEPSI CHALLENGE!” t-shirts be? The real advantage Pepsi had over Coke was entirely ideological. Pepsi was, by its own decree, the “choice of a new generation.” Pepsi was open to change (to this day it significantly alters its can design every few years). Coca-Cola, on the other hand, was an old-fashioned company run by Robert Woodruff, a 95-year-old southern aristocrat. The company was so resistant to change that it kept its “secret formula” literally locked in a vault.

Pepsi was the company that hired Michael Jackson as its spokesman. Coca-Cola was the company that passed on him as “not patriotic enough.” (As Coke historian Thomas Oliver noted, the King of Pop’s “androgynous appearance didn’t jibe with the company’s image of the all-American boy.”) Pepsi spoke to the Baby Boomers. Coke didn’t trust them.

The problem for Coke was that, by 1985, the Pepsi-drinking Boomers were the ones with the money, while their Coke-drinking parents were stashing Social Security checks under mattresses in southern Florida. It was this Pepsi-guzzling environment that led sixteen Coca-Cola executives to a top-secret meeting at the McCann-Erickson advertising agency offices in New York. The members (only two of whom had any idea what the purpose of the gathering was) passed by a guard from the notorious Pinkerton Detective Agency and took their seats around an ominous circular table straight out of Dr. Strangelove. And, like Dr. Strangelove, an eccentric foreign scientist, the flavor chemist-turned Coke vice president Sergio Zyman, announced a shocking plan: “We’re replacing Coke with a new Coke.”

In retrospect, Coca-Cola would have done better to keep New Coke (code name: “Project Kansas,” in honor of a Kansas newspaper’s description of Coca-Cola as “the sublimated essence of all that America stands for”) as under-wraps as it was in those early months. Within a week of New Coke’s public announcement in April, Coca-Cola was receiving over a thousand phone calls a day from enraged consumers furious over the company’s decision to remove Coke. By mid-June this number had risen to over 7,000.

“Changing Coke is like breaking the American dream,” wrote one angry Coke drinker. “Monkeying with the recipe is akin to diddling with the U.S. Constitution,” cried another. Other signs of consumer outrage: the attack of a Coke delivery driver by an elderly-yet-furious shopper in a southern grocery store, a retired Air Force officer requesting that his ashes be ceremoniously sealed in an “old” Coke can, and a Georgia minister asking his congregation to pray for the immortal soul of a local bottler who had damned himself to Hell by distributing the wicked brew that was New Coke.

This public outrage, as well as New Coke’s disappointing sales, led Coca-Cola to announce on July 10, 1985, that “old” Coke would be returning to store shelves as Coca-Cola Classic. The original pullback plan was to keep New Coke as the company’s flagship brand and have Classic be nothing more than an alternative. But sales of Coke Classic so overwhelmed those of New Coke. Coke Classic became Coca-Cola, and New Coke became “Coke II.” Coke II soon faded from grocery store shelves - save for one consumer: Coca-Cola CEO Roberto Goizueta, who drank the new formula long after it’s fall from grace, until his death in 1997.

The most famous legacy of New Coke is that of a silly corporate misstep, or a charmingly dated piece of ’80s nostalgia on par with an episode of AfterMASH. But, with 25 years’ hindsight, those three months in 1985 w take on a much grander meaning. The product and (perhaps more importantly) its marketing, capture perfectly the pop-cultural climate of the Reagan Era, and how the nature of consumerism has changed in the 2.5 decades since that Era. In this way, New Coke is kind of like Mad Men with way worse clothes.

Six months after the Coke Classic’s return, America struggled to comprehend just what the Summer of New Coke meant. Donald Keough, head of Coca-Cola North America, appeared on the national morning news show Today. What Keough himself had to say is pretty unimportant (it was mostly public-relations stuff about the lasting magic of Coca-Cola, or some s*** like that). What IS relevant is what Jane Pauley, the Today anchor interviewing Keough, had to say. As she opened her Q-and-A, the journalist read with genuine amazement a quote from Coke USA president Bryon Dyson regarding New Coke. Dyson attributed the disconnect between the New Coke and its outraged public to the the “intrinsic” versus “extrinsic” nature of marketing:

Intrinsics means I buy the product because I like the way it tastes. Extrinsics is: I buy the product because I like the image. It’s fun. It’s friendly. It’s American. Used to be, we bought the product primarily because of taste…

“A phenomenal shift!” remarked Pauley, wide eyed. “We now by soft drinks for the image.” In 2010, of course, any jaded Generation X’er who’s rented Reality Bites or read Fight Club enough times takes this fact (the superficial nature of marketing) as a given. And not even in a cynical, Kurt Cobainian way. One of today’s most admired TV protagonists, Don Draper, makes a living perpetuating marketing superficiality as Sterling-Cooper’s creative director. Another great American Don D. (White Noise’s Delillo) makes an even better living examining that superficiality. The point is that, today, even the least engaged American takes it as a given that we’re, like, buying the image, dude. And yet here, in 1985, was a national news correspondent treating the idea of being influenced by commercials as the biggestexpose since Watergate.

This is the real legacy of New Coke. It didn’t change the soft drink marketplace or spike Coca-Cola’s stock price the way the boys in Atlanta had hoped, but it was the beginning of our modern understanding of advertising. In his comprehensive history of Coca-Cola, For God, Country and Coca-Cola, published shortly after the 1980s (a/k/a the Decade of New Coke) had drawn to a close, Mark Pendergrast offered a pitch-perfect analysis of the unique American climate that led to Coca-Cola’s brief reformulation: “The corporate blindness stemmed not so much from geography or cultural background as from the Eighties mentality,” he wrote. “Aggressive, ruthless, and cocky, the new team wanted to repeat the blockbuster breakthrough of old Coke.” They didn’t succeed, but what their unsuccessful attempt taught the nation is more important than any sweetened 12oz can of high-fructose corn syrup could have been.

“It’s hard to see that type of thing coming.”

No it’s not. It’s an institution and had been for 90 years.

All diet root beers aren’t that different from their baseline. At least, not the way regular soft drinks are.

I grew up with Pepsi(sorry. not Coke) and loved it. When I grew up I could not tolerate a full can without feeling very gaseous for days. A few months ago I tried the Throwback. I not only liked it better, but did not have the burpy feeling. Now I know it was the HFCS.

Approximately when did HFCS replace sugar, then? If it was virtually the same time, then the conspiracy could have some validity. If it was significantly earlier, then not at all.

The switch-over happened on a bottling plant by bottling plant basis. Started in the late 1970s, was about 1/2 completed (on a product volume, not #s of plants basis) sometime in 1980 and was fully completed about six months prior to New Coke being rolled out in 1985.

It’s an institution and had been for 90 years.

But that's ridiculous. Coke still existed, and people preferred the flavor of New Coke. As a company, I'm supposed to anticipate that people will revolt over a product that bears the same name and has a taste that more people prefer?

I get that people don't like change, but still. Here is essentially what people said: "I demand that you replace this better tasting product with one that tastes worse. Otherwise, I will stop buying your new, better tasting product."

What always gets overlooked with New Coke is that New Coke beat “old” Coke in taste tests, which is the main reason that Coke rolled it out. Coke just didn’t expect the backlash that would come from changing what was considered a classic.

Yup, intrinsic vs. extrinsic value.

Because New Coke as a Coca-Cola replacement (as opposed to a new drink that would complement Coca-Cola) was kept secret, the Coca-Cola marketing folks could only ask about reactions to the taste ... not about the entire concept of changing an American Institution (TM). If they had been able to ask the more important question (what do you think about Coke changing its formula) they would have noticed the likely fallout immediately.

I’ve heard this theory too, and I for one am inclined to believe it. About a year ago I was in Texas visiting a friend and he introduced me to “mexican coca-cola”. Apparently coke is able to use cane sugar in the product they manufacture down there. The difference was staggering. I was immediately transported to back to the age of six . . . or the last time I’d had a “real” coke. I’ve also read about coca-cola offering “kosher coke” for passover, and some other holidays, that is sweetened with sugar instead of corn syrup . . . but I’ve yet to see it offered in my area.

As I recall, there was some testing like that, but the question wasn’t quite so direct. Something like, “assume this is Coke. Would you buy it?”

Clearly a textbook marketing blunder in retrospect, but I think that the folks at Coke get skewered a little too much for a decision that made rational sense at the time. Coke invested a lot of money in testing the product and got good results. Weird thing happened when they went to market.

I’d read that before the release of new coke the drink contained a mixture of HFCS and sugar but when coke classic was rolled back out all of the sweetener was HFCS. Can’t account for the validity of that though . . . I don’t recall the source.

the Eighties mentality,” he wrote. “Aggressive, ruthless, and cocky

New Coke was a debacle no doubt but this passage is the same old lazy shorthand for the 80s.

We could use some aggression, ruthlessness and cockiness right now instead of the death-by-bureaucracy-and-taxes we are getting along with the embarrassing daily antics of the Scarecrow In Chief.

Yeah, I’m not too impressed by the let’s-make-fun-of-the-’80s statements, especially when their commentary on what the public was like vs. earlier turn out to be false. As if everyone wanted to reject “old” Coke - yet they wanted it as is.

My husband read that Throwbacks were only for a limited time, NOT including now but months ago. Are you still getting this?

My husband read that Throwbacks were only for a limited time, NOT including now but months ago. Are you still getting this?

I picked up a 12-pack here at Vons about two weeks ago. I avoid HFCS and normally drink Hansen's cane soda (about a can every other day). I thought I'd show my appreciation to PespiCo by purchasing their "throwback" brand (what a horrible name, IMHO). Good stuff! But if they discontinue it, I'll be back to drinking Hansen's.

During my time in Afghanistan all the soft drinks were from Dubai or Kuwait. Real sugar, will not dring the sludge they call soft drinks here anymore.

Thanks for your service!

When I've been carrier-deployed in the Gulf, we got the same stuff. Coke, Pepsi, Mt. Dew, 7-Up, etc. all with Arabic lettering of the logos, all in those old-fashioned pull tabs cans, and all sweetened with sugar. Some of the younger sailors would comment that the soda tastes funny. I'd reply, "This is what it's supposed to taste like!"

And Fanta orange. Saw a lot of that. The Arabs drink that stuff like water!

Thanks for the article. Whatever the writer says, though, New Coke was a stroke of unintended genius. The demand for the old Coke shot sales through the roof. BTW, for the people interested, the Dr. Pepper with real sugar is bottled in Dublin, Texas. Their web site is http://www.dublindrpepper.com/ and you can order the real Dr. Pepper made with pure cane sugar from their web site.

For Coca Cola with real sugar, passover is the only time I know you can get it.

....yes, as of two weeks ago my c-store still had a Throwback end cap....local WalMart is sold out however.

About a year ago I was in Texas visiting a friend and he introduced me to “mexican coca-cola”. Apparently coke is able to use cane sugar in the product they manufacture down there.

The Mexican grocery stores have all sorts of wonderful things, especially if you have a sweet tooth. Try Malta or some of the other non-alcoholic malted beverages.

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