Carey could learn a les­son from Coke


com­peti­tor, but fur­ther threats were loom­ing on the hori­zon in the shape of diet co­las and en­ergy drinks. Tra­di­tional con­sumers in­creas­ingly em­braced Pepsi, while the Baby Boomer gen­er­a­tion went for the zero-sugar op­tion, or, hor­ror of hor­rors, the new­fan­gled, caf­feine-over­loaded stuff. Coke’s mar­ket share had plum­meted from a post-WWII high of 60 per cent to un­der half that in 40 years; worse, what slice re­mained was mainly down to historic old-school con­tracts. Panic set in, and the se­cret recipe that cre­ated the drink in the rst place was ushed away. Does this sound fa­mil­iar?

Coke’s ex­ec­u­tives had com­mis­sioned mar­ket re­search, eld staff had set up tast­ing ses­sions, and fo­cus groups com­pris­ing reg­u­lar con­sumers and new gen­er­a­tionals had been thor­oughly de­briefed. Ev­ery­thing had been done by the book – and the re­sults showed that Coke had no op­tion but to ditch the old recipe. The mantra was: “New Coke or no Coke”.

Just 12 per cent of diehards in­di­cated they would rebel; the rest (in­clud­ing, cru­cially, many Boomers) en­thused about the new taste. And that’s where things went hor­ri­bly wrong: in the process of crunch­ing the num­bers, the com­pany as­sumed the up­take for the new recipe would more than off­set lost tra­di­tion­al­ists who didn’t like it.

So it seemed ini­tially, for sales im­me­di­ately leapt eight per cent as the launch hype prompted peo­ple to try the re­vised prod­uct. But then the com­pany’s as­sump­tion made an ass of the en­tire strat­egy: New Coke bombed as tra­di­tion­al­ists ex­pressed their out­rage, with one lobby group re­ceiv­ing over 60,000 call-ins de­mand­ing the clas­sic recipe be re­in­stated. The com­pany obliged af­ter 79 days, and New Coke stub­bornly splut­tered on (al­beit re­named Coke II) for a num­ber of years, while Clas­sic Coke’s sales rock­eted.

F1 it­self offers a re­cent par­al­lel in the form of the knee-jerk changes made ear­lier this year to its qual­i­fy­ing for­mat, and the ini­tial stub­born re­fusal of the sport’s mas­ters to re­vert to the old sys­tem that had served it so well since 2010. Twenty-eight days af­ter in­tro­duc­tion they made a U-turn, but only af­ter propos­ing a hy­brid ver­sion. For­tu­nately, though, there was no Quali II recipe oper­at­ing in par­al­lel.

Therein lies the moral: Carey and Co do need to freshen up F1, for not only is it com­ing un­der pres­sure from in-house ‘diet’ prod­ucts such as WEC and Formula E, but, equally, from other, more en­er­getic, sport­ing gen­res. In ad­di­tion the new ‘Boomers’, known as ‘Mil­len­ni­als’, have adopted dif­fer­ent life­styles from their el­ders, be­ing more eco­log­i­cally and en­vi­ron­men­tally aware. Thus the ques­tion facing Carey is: ‘How far to go?’

Does he go the full nine yards and make dra­matic changes to the sport’s for­mat and swinge­ing im­prove­ments to its me­dia pal­ette, risk­ing a de­fec­tion of F1’s tra­di­tional fan base while hop­ing to at­tract the Mil­len­nial au­di­ence? Or does he ini­tially of­fer a hy­brid F1 in the hope of strad­dling the di­vide, then grad­u­ally ramp up the changes?

With­out doubt the lat­ter op­tion seems less pre­car­i­ous, but, equally, F1 needs to tap into those un­ac­cessed au­di­ences ASAP be­fore all chances of switch­ing them are lost, and one thing F1 does not have is a lot time. Con­tracts are run­ning out, TV rat­ings are down 30 per cent over ve years and pro­mot­ers are push­ing for sanc­tion­ing-fee re­duc­tions in the face of dwin­dling live at­ten­dances.

Plus, just to ratchet up the pres­sure on Lib­erty, the me­dia com­pany does not have the op­tion of ‘New F1 or No F1’, or run­ning F1 II along­side Clas­sic F1.

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