Thursday, October 6, 2016

Conk Coke Change Concerns

It’s hard to imagine any marketing expert failing to know what happened April 23, 1985. Oh, they might not recognize the specific date, but they’re bound to recall the unveiling of New Coke® to a world which promptly rejected the reformulation of an American classic.
     The error made by The Coca-Cola Company was overlooking Coke’s nostalgia appeal. You won’t want to make such an error when introducing changes in your retail business. Researchers at Ithaca College and Kent State University documented how nostalgia is generally a sales draw, but when the object of the nostalgia changes significantly and suddenly, your most ardent fans will be repelled. Further, those consumers motivated to shop with you because of nostalgia are substantially more likely than the less nostalgic to consider even moderate changes as significant.
     Lead customers through changes gradually, advise researchers at University of Minnesota, Emory University, and George Mason University. Determine where you want to end up, and if this ending point is quite different from where you are now, introduce at least one intermediate step. If you currently sell paint and you want to end up adding draperies, consider introducing wallpaper first. If you plan to phase out your entire stock of draperies, reduce the product assortment for a while before eliminating the product category completely.
     Because of what occurred on April 23, 1985 and continuing for 79 days until the original formula was reintroduced, the term “New Coke” has come to characterize a huge marketing failure. Using the term that way distorts the true story: Starting in 1970, the market share for Coca-Cola was decreasing as the market share for Pepsi increased. By 1985, The Coca-Cola Company’s investors and directors were pushing for change. The reformulation was to one preferred overall to the old formula in taste tests administered to a total of about 200,000 consumers. This wasn’t a move based on whim.
     And when the error was remedied 79 days later, with the original formula being reintroduced, New Coke stayed on the market as an additional source of revenue in the company’s portfolio for a time, with the market share of that portfolio growing mightily in the months following the controversy because of all the publicity.
     Even if do you reach too far making changes to your retail business, leverage the nostalgia appeal by acknowledging your fans. Rein in the change so that the transformation is gradual.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Adjust Merchandising to News Events
Lead Your Customers Through Changes Gradually
Create Lasting Memories of Your Store
Appeal to Nostalgia
Let Go of Irritating Brand Extensions

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