Marketing Franchises Pt1: Why We Hated New Coke but Can’t Wait for the iPhone 8

My first in a series of articles on Franchise Marketing.

On a larger scale, food is rarely marketed as a sequential product. Occasionally we might see “improved taste” or “new recipe” on a box; but these are exceptions to the rule. For some reason, food is simply not marketed as a sequential good despite the fact that the flavors are constantly changing to meet new tastes.

This was a major part of my studies during my graduate work at GMU. There is some discussion of the economic notion of product spaces, but readable, I think.

An iPhone, as a utility good, can always be improved in a way that is easy to understand and does not complicate the comparison of one model to the next — more memory is always better, all else equal. Coke is right to continually adjust its flavor profile to best match consumer preferences; but publicly announcing a change disrupts consumers’ decision-making rituals because it’s not obvious to consumers that the change is necessarily better. Unlike memory in a smartphone, more sugar isn’t always preferred to less sugar.

Do read the whole thing.


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