What fundraisers can learn from the New Coke disaster

Back in the 80s, Coca-Cola was being hammered by a Pepsi ad campaign that showed people preferring Pepsi over Coke in blind taste tests.

They decided to do something: Change the formula of Coke so it tasted more like Pepsi. This is now remembered as one of the most colossal business blunders of the century.

What does it have to do with you and me? Here’s a post from Michael Hyatt that shows how any of us can make New Coke types of decisions: New Coke: Anatomy of a Terrible Decision. The post outlines 5 lessons from the New Coke fiasco:

  1. Don’t let the competition distract you. (Don’t be the second-best “them” — be the best you!)
  2. Don’t bet the farm on big data. (Data can tell you a lot, but not everything.)
  3. Don’t make everything either/or. (You don’t have to kill off your “Coke” and replace it with something new. There are a number of “in-between” options that might work far better!
  4. Don’t be arrogant. (You think you know better than your donors. You don’t. You know might know more, but you don’t know better!)
  5. Don’t persist in error. (If you get it wrong, stop as soon as you realize it!)

Whatever your organization does, I’m confident it’s more important than sweet fizzy water. Let the errors Coca-Cola made keep you from making similar ones!


Comments

2 responses to “What fundraisers can learn from the New Coke disaster”

  1. First, I’m amused by the fact that you’ve used New Coke as an example. I suspect many of your readers weren’t even alive when New Coke was born. However, as an emerging old-timer, I do remember it well.
    Second, one of the reasons New Coke was a disaster is that the company actually listened to its customers. In blind taste tests, New Coke outperformed Coke Classic. So, the company thought it was on safe ground when introducing the new recipe. Yet, there were a number of problems as the company tried to be responsive to customer desires:
    1) The taste tests were in isolation. In other words, people didn’t taste the product with food, so they weren’t really tasting it in a true life environment. (When building a test, do it right.)
    2) Coke buyers tended to be traditionalists who did not like change. So, even if they really did like the taste of New Coke better (and maybe they didn’t), they still didn’t like it enough to justify a loathsome change. If they did want a change, they’d buy a Pepsi.
    3) People often say one thing while behaving another way. For example, how often do folks say they hate direct mail, yet give to direct mail appeals anyway?
    Change can be good. However, it needs to be well considered and tested. Sometimes, that even means ignoring what customers/donors say and paying more attention to what they do.

  2. First, I’m amused by the fact that you’ve used New Coke as an example. I suspect many of your readers weren’t even alive when New Coke was born. However, as an emerging old-timer, I do remember it well.
    Second, one of the reasons New Coke was a disaster is that the company actually listened to its customers. In blind taste tests, New Coke outperformed Coke Classic. So, the company thought it was on safe ground when introducing the new recipe. Yet, there were a number of problems as the company tried to be responsive to customer desires:
    1) The taste tests were in isolation. In other words, people didn’t taste the product with food, so they weren’t really tasting it in a true life environment. (When building a test, do it right.)
    2) Coke buyers tended to be traditionalists who did not like change. So, even if they really did like the taste of New Coke better (and maybe they didn’t), they still didn’t like it enough to justify a loathsome change. If they did want a change, they’d buy a Pepsi.
    3) People often say one thing while behaving another way. For example, how often do folks say they hate direct mail, yet give to direct mail appeals anyway?
    Change can be good. However, it needs to be well considered and tested. Sometimes, that even means ignoring what customers/donors say and paying more attention to what they do.

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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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Jeff BrooksJeff Brooks has been serving the nonprofit community for more than 35 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com. More.


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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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Jeff Brooks has been serving the nonprofit community for more than 30 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com.

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