Fizzled Out: Why Coca-Cola Purposely Designed a Soft Drink to Fail

iStock
iStock

In December 1992, media outlets from around the country filed into the Hayden Planetarium at New York City's American Museum of Natural History for what soft drink giant Coca-Cola was trumpeting as a “truly out-of-this-world experience.” In front of reporters, the company's North American president, Doug Ivester, unveiled a 16-ounce silver can that he hoped would change the landscape of soda.

The product was Tab Clear, a new version of the sugar- and calorie-free diet drink first introduced in 1963. While it retained its bubbles, the liquid was transparent, an obvious nod to rival Pepsi’s introduction of Crystal Pepsi earlier that year.

Publicly, Ivester boasted that Tab Clear would be yet another success in Coca-Cola’s long history of refreshment dominance. But behind the scenes, Ivester and chief marketing officer Sergio Zyman were convinced Tab Clear would be a failure—and that is exactly what they hoped would happen. Flying in the face of convention, the launch of Tab Clear was deliberately designed to self-destruct.

 
 

In the early 1990s, beverage manufacturers were heavily preoccupied with the idea of clear drinks that communicated a sense of wellness. The Coors company even produced a clear alcoholic malt beverage, Zima, to capitalize on the craze, but porting it over to the soft drink market was nothing new. In the 1940s, Soviet leader Georgy Zhukov used his friendly relationship with the U.S. to make an appeal for Coca-Cola to produce a clear version of their drink so he could enjoy it surreptitiously and without being accused of indulging in a capitalist product; the soda maker removed the caramel from the recipe, which essentially de-pigmented it. Coca-Cola also produced Sprite, a fizzy, lemon-tinged drink that didn’t use coloring.

But it wasn’t until Pepsi unveiled Crystal Pepsi in 1992 that marketing departments began to pay close attention to transparency in their product. Crystal Pepsi was essentially a fruit-flavored variation of regular Pepsi, with all the typical amounts of sugar and calories but no caffeine. That light could pass through the beverage was a novelty, albeit one that Pepsi believed could help them carve out a 2 percent slice of the $48 billion soft drink market. And if Pepsi could do that, it would mean less money for Coca-Cola.

Like a boxer preparing a counter-attack, Coke couldn’t simply sit back and allow Pepsi to strike without retaliation. But few within the company were sold on the longevity of the clear soda craze. Worse, the company had stumbled badly with New Coke in 1985, a new formula intended to replace the classic version that drew public criticism and created a public relations disaster. Tempting fate with a Clear Coke was out of the question.

Zyman had the answer. Before coming to Coke, Zyman had been a director of sales and marketing for Pepsi; he defected to Coca-Cola just in time for the highly successful launch of Diet Coke in 1982. After a sabbatical, Zyman—a notoriously combative executive who earned the nickname the “Aya-Cola” for his management style—returned as chief marketing officer and devised an ingenious plan to stifle Crystal Pepsi without risking the reputation of Coca-Cola Classic. His sacrificial pawn would be Tab.

Sometimes stylized as “TaB," the drink had been introduced in 1963 as an alternative for calorie-conscious consumers. Sold in a pink can, it was targeted specifically at women concerned about their weight and marketed as a solution to increase sex appeal. Tab, ads claimed, could help consumers “be a shape he won’t forget … Tab can help you stay in his mind.”

With Diet Coke available to help keep marriages from crumbling, Tab was relegated to an afterthought, falling from 4 percent of Coke's overall market share to just 1 percent. Zyman believed it was expendable. If Tab Clear happened to catch on, fine. If it didn’t, the failure wouldn’t reflect poorly on the Coke brand.

But Zyman wasn’t content to simply try to compete with Crystal Pepsi. In his mind, Tab Clear was what consumer brands refer to as a “kamikaze effort,” a product expected to fail. Zyman believed that the presence of Tab Clear on shelves would confuse consumers into believing Crystal Pepsi was a diet drink. (It wasn’t, though there was a Diet Crystal Pepsi version available.) By blurring the lines and confusing consumers who wanted either a calorie-free drink or a full-bodied indulgence, Zyman expected Tab Clear to be a dud and bring Crystal Pepsi down right along with it.

“It was a suicidal mission from day one,” Zyman told author Stephen Denny for his 2011 business book, Killing Giants. “Pepsi spent an enormous amount of money on the [Crystal Pepsi] brand and, regardless, we killed it.”

 
 

With Pepsi set for a massive ad spend on the January 1993 Super Bowl, Coke rolled out Tab Clear in 10 cities, with national expansion coming mid-year. Their ad spending was minimal. Coca-Cola made just enough noise to reposition Crystal Pepsi from a hot, trendy new drink to a product with an identity crisis.

“They were going to basically say it was a mainstream drink,” Zyman said. "'This is like a cola, but it doesn’t have any color. It has all this great taste.' And we said, 'No, Crystal Pepsi is actually a diet drink.' Even though it wasn’t. Because Tab had the attributes of diet, which was its demise. That was its problem. It was perceived to be a medicinal drink. Within three to five months, Tab Clear was dead. And so was Crystal Pepsi.”

The dissolution of soda products on shelves is not inherently dramatic, and there was no visceral evidence on display that Tab Clear was flailing. But by the end of 1993, Zyman’s prediction had come true. Crystal Pepsi had grabbed just 0.5 percent of the market, a quarter of Pepsi's prediction. Both Tab Clear and Crystal Pepsi were phased out and Coke was happy to write the dual obituary. “Now both Tab Clear and Crystal Pepsi are about to die,” Coca-Cola chairman Roberto Goizueta told Ad Week in November 1993.

But it was Pepsi that had spent millions in development and $40 million in marketing; it took the company 18 months to formulate their failure. Coke spent just two months on Tab Clear. It was a barnacle that dragged its far more ambitious rival down with it.

Zyman continued to work for Coca-Cola through 1998. Clear products never caught on as some companies anticipated, though they do experience periodic revivals. Zima returned to shelves in 2017, and Crystal Pepsi has had promotional comebacks.

In one final twist, and despite Ivester's earlier declaration that Clear Coke would never see the light of day, the company’s Japanese arm released a zero-calorie Coca-Cola Clear in the country on June 11. This time, they might even want it to succeed.

Too Sexy to Last: The Right Said Fred Story

Ralph Orlowski, Getty Images
Ralph Orlowski, Getty Images

Guy Holmes popped the tape into the cassette player in his car and waited. The British record promoter was eager to hear new acts, but knew that the majority of them weren’t going to be good or unique enough to cut through the noise of the worldwide music scene. In 1991, it was still a multibillion dollar business, not yet smothered by file-sharing. Success was determined by decision-makers at record labels and radio stations, whose tastes were often mercurial and hard to anticipate.

The cassette had been given to Holmes by a friend, a 19-year-old named Tamzin Aronowitz. She was dating Rob Manzoli, the guitarist of an act called Right Said Fred, and insisted the group—which also consisted of brothers Richard and Fred Fairbrass—had a hook. He listened.

I’m too sexy for my car

Too sexy for my car

Too sexy by far

And I’m too sexy for my hat

Too sexy for my hat

What do you think about that?

Holmes was driving with a friend, a man of Russian descent who had been drinking vodka for most of the night. As Richard Fairbrass sang about other things he was too sexy for—Milan, Japan, parties, his shirt—Holmes noticed his passenger bouncing in his seat and mouthing the words.

This might be a dumb song, Holmes thought. A very dumb song. But it’s catchy.

By 1992, “I’m Too Sexy” was the number one tune in 32 countries, including the United States, and the Fairbrass brothers went from being gym managers and sporadic musicians to the kitschy pop act of the moment. But they wondered whether people knew they were in on the joke, and whether they had the ability to survive the plague that had taken down so many talented musicians before them—the affliction of being an overnight success.

 
 

Richard Fairbrass was born in East Grinstead, Sussex in 1953. His brother, Fred, followed three years later. Raised in a relatively well-off environment by Peter and Mary Fairbrass, Richard thought he might wind up becoming a politician; Fred was more interested in athletics. By their late teens, both had gravitated toward music, forgoing any thought of a formal career in exchange for odd jobs and band practice that led to small gigs with London punk bands. At one performance, an irate—or possibly enthused—fan managed to pee on Richard.

From 1977 to 1987, they performed under a variety of names, including Trash Flash and Money, and landed a series of not-quite-breakthrough gigs. Richard got a job as a session musician for three David Bowie music videos, while Fred had a stint backing up Bob Dylan. Their act wavered from punk to rock to a blend of the two.

After an unsuccessful tour of New York, the brothers returned to London in 1988. Both took to going to the gym to build their bodies back up and shaved their heads. They also met Rob Manzoli, a guitarist, and Brian Pugsley, who had access to computer synthesizers that the brothers thought might evolve their sound into something more palatable than their acoustic act.

Jamming in Pugsley’s apartment one night over a bass line inspired by Jimi Hendrix, Richard took off his shirt—it was hot in there—and proclaimed he was “too sexy” for it. From that line evolved an entire hook that played on the narcissism the brothers had witnessed both in the gym and among the models in New York’s fashion scene. The song wasn’t about the band thinking they were too sexy, but about the self-absorbed egos who really believed it. Supported by a backing track from a DJ named Tommy D, "I'm Too Sexy" was polished into an anthem about vanity.

 
 

Now going by Right Said Fred—a name they took from a 1962 Bernard Cribbins song about furniture movers—the trio started shopping the single to record labels. No one was interested. The only bite was from Holmes, who tried to entice executives but was met with the same resistance. In a self-admitted act of “belligerence,” Holmes produced copies of the single himself, while his secretary, Aronowitz, became the group’s manager. It was a homegrown operation, one in which the group was urged to formally record the final version of the song in an unheated studio because it was cheaper.

“I’m Too Sexy” made its way into the hands of producers at the BBC and Capital Radio. “I’m not sure if this is good or it’s crap,” one radio producer said, then played it anyway. The song spread quickly, making its way to the top of the most-requested queues in England. A DJ from Miami was on vacation in Europe when he heard it. From there, it spread to the United States and abroad, topping the Billboard Top 100 chart for three weeks straight and becoming a perpetual club selection well into 1992. (It only rose to number two in the UK, trumped by Bryan Adams’s “(Everything I Do) I Do It For You.”) The pop icon of the era, Madonna, announced she was sexually interested in Fred. Truant students announced they were “too sexy” for school. Stewardesses asked the brothers if they weren’t “too sexy” to be on a plane, a variation on a joke that they would wind up hearing thousands of times.

“It’s part of the job,” Fred said of the jokes.

Almost immediately, Right Said Fred underwent what industry veterans would call an "image makeover." A fashion designer squeezed them into vinyl outfits, fishnet shirts, and various half-clothed stage uniforms. Though they were in their early thirties, they fibbed and told reporters they were in their early twenties. They were advised to ease up on the weightlifting, as their pumped-up physiques were deemed too frightening for general public consumption.

Holmes produced their first album, 1992's Up, and helped them spin off two more successful songs: “Don’t Talk Just Kiss” and “Deeply Dippy.” They made the requisite MTV appearances and fended off speculation that “I’m Too Sexy” was a sign of them being the prototypical one-hit wonder.

Unfortunately, "I'm Too Sexy" wound up proving exactly that. But the brothers would argue that it was not their fault—it was Holmes’s.

 
 

Up had taken just five weeks to record. Their sophomore album, Sex and Travel, took nine months. Released in 1993, it failed to capture the public’s attention in the way “I’m Too Sexy” seemed to reverberate with kids, teens, and adults.

The brothers would later point the finger at Holmes, claiming he had chosen to release the wrong single tracks; Holmes countered that Richard and Fred had final say over what got the “A” side of the records. Subsequent albums followed—nine in all—but none ever reached the heights of their event-filled summer of 1991.

“I’m Too Sexy” remains a popular jab at people who indulge in vanity, and the brothers still perform it as part of their regular gigs. (Manzoli left the band in the mid-1990s.) They approved a new version targeting Syrian president Bashar al-Assad (who was revealed to have had the song on his playlist) and debuted it on Last Week Tonight with John Oliver in 2014. (“I’m too sexy for this shirt” became “You’re too awful for this Earth.”) To this day, however, Fred believes there’s still some confusion over whether the song is to be taken seriously. He tried to clarify it for Rolling Stone in 2017.

“They didn’t get the cynicism and the joke,” he said. “But the idea of the song is that you obviously can’t be too sexy, right? No one can be too sexy.”

Bottle Service: How Snapple Took Over the 1990s

David Paul Morris, Getty Images
David Paul Morris, Getty Images

For many consumer brands, the ultimate sign of success is being the subject of an urban legend. In 1985, Procter & Gamble had to refute accusations that their moon and stars logo was somehow representative of Satan worship. In the 1990s, Kentucky Fried Chicken’s publicity department fielded questions about raising eight-legged chickens with no beaks in order to satisfy product demand. In the trifecta of brand disparagement, a rumor circulated in the early 1970s that “Mikey,” the spokes-kid for Life Cereal, had died after mixing Pop Rocks candy with Coca-Cola to produce a combustible blend that blew up his stomach.

In 1993, it was Snapple’s turn. For months, word had circulated in California's Bay Area that the massively popular iced tea and fruit drink brand was secretly funneling money to the Ku Klux Klan organization. The reason? A small “K” appeared on the product label. The rumor persisted to the point that Snapple took out ads in California newspapers to declare they had no involvement with the group.

That such a rumor existed was a kind of testament to the brand's market dominance. Originally founded in Long Island as a regional manufacturer of alternative drinks, Snapple had grown from $13.3 million in revenue in 1988 to $774 million in 1994. Positioned as a healthy alternative to soft drinks, the company used clever marketing, homespun consumer relations, and a relatable spokeswoman to become one of the biggest consumer success stories of the 1990s.

Unfortunately, Snapple’s problems went beyond being falsely affiliated with a racist hate group. Despite their raging success and a $1.7 billion valuation, the company lost sight of the marketing strategy that had catapulted them to a leading position in the beverage market. By 1997, consumers were losing their taste for the “best stuff on earth."

 
 

Arnold Greenberg was running a health food store in 1972 when two old friends joined him in a new venture. Leonard Marsh and Hyman Golden were brothers-in-law and owned a window washing business. On the side, they partnered with Greenberg to create Unadulterated Food Products, Inc., peddling fruit juices, eggs, and produce to other health food stores in and around New York City.

The men intended for their flagship product to be a carbonated fruit juice, combining the fizz of a soft drink with natural ingredients. Their first try, apple juice, fermented in the bottle and exploded, popping off caps and ruining their inventory. The drink was abandoned, but the name—Snapple, a mix of “snappy” and “apple”—stuck. (A company in Texas happened to have already trademarked the name. The three men bought it for $500.)

A bottle of Snapple sits on a table
chrisjtse, Flickr // CC BY-ND 2.0

Unadulterated Food Products did steady business for much of the 1980s selling to bodegas, delis, and other food service locations where people could pick up a bottle to go along with their lunch. In 1987, they had a breakthrough with their approach to iced tea. By bottling it hot, the company was able to avoid adding preservatives, which bolstered their all-natural claims. And by offering it year-round instead of just in the summer, they appealed to consumers who enjoyed the drink in cooler weather.

Snapple embraced their homemade identity. Sipping tea from their wide-mouth bottles was not unlike sipping from a piece of glassware on a porch somewhere; their labels were haphazard in design, the graphics a little lopsided. Compared to the corporate perfection of Coca-Cola, Snapple seemed scrappy.

 
 

Despite the company’s commitment to a casual aesthetic, Greenberg and his partners were taken aback in 1993, when advertising firm Kirshenbaum Bond presented their newest idea for a national ad campaign. They wanted to film the company’s mailroom lady, Wendy Kaufman.

Kaufman had arrived at Snapple in 1991 after getting a referral from a friend’s father who also happened to be a close friend of Greenberg’s. Working in the shipping department, Kaufman took notice of the many letters that were pouring in to the company’s Valley Stream, Long Island headquarters. She asked a supervisor if she could begin responding to them. From there, Kaufman’s job developed into more of a public relations representative.

The ad firm’s idea was to maintain both Snapple’s simplicity and Kaufman’s unrehearsed appeal by shooting a series of television spots that would feature her reading real letters from behind a desk and then following up with the correspondent. One kid wrote in saying he’d make a good mascot; Kaufman showed up with a film crew and took him to mascot school. Another asked Kaufman to be his prom date; she accepted.

For Kaufman, it was an opportunity to distance herself from a self-admitted coke addiction (not the carbonated kind) that had started in 1980. For Snapple, it represented a chance to further their brand identity by passing up the kind of rock star endorsements common in the beverage industry. The 37 commercial spots, shot between 1993 and 1995, were enormously popular, and Kaufman became a mascot on par with Tony the Tiger. She made personal appearances, storming dorm rooms with cases of Snapple. She sifted through 2000 letters a week. Sales jumped from $232 million in 1992 to $774 million in 1994. Snapple was on Seinfeld, on the lips of radio personality Howard Stern, and celebrated for its unique marketing approach.

Then “Crapple” happened.

 
 

In 1992, Greenberg, Marsh, and Golden agreed to sell a majority stake in Snapple to the Thomas H. Lee investment firm, with Marsh remaining on as CEO. Then, in 1994, Snapple was sold to the Quaker Oats Company. As successful as Snapple had been, industry observers were excited to see what a global conglomerate could do to carry the brand further.

As the Harvard Business Review would later point out, fostering an already-successful brand is not as easy as it appears. Quaker Oats had enjoyed an explosion of support for its Gatorade sports drink brand and believed it could apply some of those same strategies to Snapple. Bottles got bigger, from the standard 16 ounces to 32 and even 64-ounce containers. Gone was Kaufman, no longer a good fit for Quaker’s polished promotional plans. They also cut ties with Stern, believing the controversial entertainer didn't reflect Snapple’s growing maturity in the market.

Bottles of Snapple line a store shelf
David Paul Morris, Getty Images

In retrospect, Quaker had erred on all counts. Consumers had little interest in vats of iced tea in 64-ounce containers, preferring to sip smaller bottles at work. They missed Kaufman, who was synonymous with the brand’s irreverence and homegrown feel. And Stern, who could be caustic when he felt minimized by sponsors, began using his considerable airtime to roast Snapple, calling it “Crapple.” The rants were beamed to millions of his listeners at stations around the country.

Quaker had, in effect, misjudged or mistimed Snapple’s graduation from plucky beverage upstart to a dignified institution. The company sold the brand to Triarc for $300 million in 1997. They had paid $1.4 billion for it just three years earlier. Following the sale, Quaker CEO Bill Smithburg resigned from his post.

 
 

Though Snapple’s heyday may have passed, there was still considerable consumer enthusiasm for its more adventurous flavors (like Diet Kiwi Strawberry Cocktail, which was allegedly a favorite among some horses at a Seattle stable) and for a return to less aggressive marketing. In 1997, Triarc invited Kaufman not only to come back and shoot a new commercial but to allow her face to be stamped on every bottle of Wendy’s Tropical Inspiration. And instead of limiting distributors to certain flavors, they shipped out more varied assortments and let consumers decide what they liked.

Triarc’s success was as notable as Quaker’s failure. The company sold Snapple to Cadbury Schweppes in 2000 for $1.45 billion. As part of the Dr Pepper Snapple Group, the brand changed hands once more early in 2018, selling to coffee cup giant Keurig, part of the JAB Holdings investment group, in exchange for $18.7 billion to shareholders.

It’s been a roller coaster of a ride for Snapple, which started in a small health food store, became a part of popular culture, was nearly done in by a misguided marketing plan, and was finally restored to its former glory by a company willing to get back to the basics.

As for that hate group involvement: The “K” on the label never had any connection with Klan activity. It stood for “kosher.”

SECTIONS

arrow
LIVE SMARTER