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