Sunday, April 25, 2010

Obamacare is the New Coke

Pat Caddell and Scott Miller compare Obamacare to the New Coke debacle.
New Coke was introduced by the company with high hopes, and they had good reasons for such optimism. It was a drink that consumers in blind taste tests rated superior not only to Pepsi, but also to Coca-Cola.

Despite consumers' immediate acceptance of the new beverage and an initial jump in sales, resistance began to form in small protests around the country. Sales began to lag. The objection was not so much to the new product itself, but to the company's hubris in removing the traditional Coca-Cola from the shelves to make way for the new.

It seems to us there may be some lessons here for politicians regarding ObamaCare. Just as most Americans were happy with the old Coke, 85% of Americans were happy with their own health-care plans at the time that ObamaCare was introduced. In essence, those plans were taken away from them in the same way the old Coke was taken away. And, as was the case with New Coke, opposition has continued to grow.
I think Caddell and Miller have missed a major issue when they say, "The objection was not so much to the new product itself, but to the company's hubris in removing" classic Coke from the shelves.

Actually, I believe that one of the major problems WAS the new product itself. The brains at the company decided to change the formula in response to Pepsi's growing market share and consumer taste tests that made them believe people preferred the taste of Pepsi. Consumers did, but only in small sips. Coke is less sweet and syrupy than Pepsi and has a crisper and more complex flavor. It isn't just the marketing of the product that makes Classic Coke the number one soft drink in the world but the secret formula that makes it distinctive.

The flaw in the taste tests was that people don't buy or drink sodas in one-ounce bottles. They drink them in 12-ounce and 16-ounce containers.

No doubt the company underestimated the brand loyalty of it's customers but the real problem for New Coke was that it just didn't taste as good Coke Classic. Americans have already figured out that Obamacare is going to cost more and will deliver less healthcare to them than American Healthcare Classic.

It has been claimed that that geniuses at Coke did all this intentionally, knowing they would introduce Coke Classic after New Coke flopped. But as the muckety mucks have admitted "We weren't that smart."

They were, however, smart enough that when consumers revolted they quickly responded and changed course back to The Future. That's the private sector for you.

Caddell and Miller are certainly right about the hubris of the Obama Administration and the Democratic leadership when it comes to Obamacare. It could haunt the party for years.

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