Coca-Cola Company Case Study

Coca-Cola ruled the soft-drink market for more than 80 years and became America’s drink. The strategy consisted of selling the product to industrial users in the form of Coke syrup and to the consumer market in the form of Coca-Cola (6.5-ounce glass bottle). Due to health concerns and demand for new flavors, during the 1970’s Coca-Cola came up with Diet Coke, Cherry Coke, Diet Cherry Coke, Caffeine-Free Diet Coke, Coca-Cola, and Caffeine-Free Coca-Cola. With the “Pepsi Challenge” it was indicated that consumers preferred the Pepsi products because of the sweeter taste. As a reaction of this study made by Pepsi, Coca-Cola removed the original formula and created a new Coke. Unfortunately, consumers did not accept the change and Coke had no other option than to bring back the original Coca-Cola formula into the market.

For the first time in Coca-Cola’s trajectory as a leader in the market, they faced the real “Pepsi Challenge” forcing them to look for new strategies. In this case, Coca-Cola had to analyze the primary and secondary data, so the problem can be identified. It is crucial that a company plans strategically every move in regards of marketing and follow the marketing mix (product, price, promotion, and place) in order to address the issue and make improvements.

The plan to eliminate the old formula was not the best strategy. Neither qualitative nor quantitative data was collected when the decision was made. Marketers need to thoroughly understand the basic needs and purchasing preferences of consumers. A company cannot assume that because of previous success in the market, every product will be accepted by consumers. This is the reason why the “Pepsi Challenge” was a great idea. Pepsi utilized taste tests to get feedback, helping the company to determine if the product would be accepted or disapproved by consumers.

When someone thinks about soft-drinks, Coca-Cola is the first thought that comes in its mind. A powerful