4 Heavily Hyped Products That Failed

By Markets Fool.com

One year ago, when Keurig first released its single-serve brewing system for cold beverages, it seemed like a brilliant idea.

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At the time, the company was riding high in the single-serve coffee space, a market it more or less created in the Unites States, with K-cup machines. Those coffeemakers went from novelties to ubiquitous in just a few years with nearly every major coffee brand signing on as a partner.

Building on that success with a cold-beverage brewer designed to compete with SodaStream seemed logical, and it looked even more destined for success when Coca-Cola (NYSE: KO) signed on as a partner, taking an equity stake in the company.

For the first time, consumers would be able to make Coke, Diet Coke, Sprite, and the rest of the company's product line at home. That, plus the success Keurig had with its K-Cup machine, made what would become the Keurig KOLD seem destined for success.

Keurig KOLD. Image source: Keurig.

Of course, while it seemed like a good idea, there were also some red flags around KOLD. Keurig had struggled with its attempts to launch non-K-cup brewers, failing with its Vue cappuccino machines, and struggling to get consumers to buy brewers that made full carafes of coffee.

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By after KOLD hit the market, consumers quickly became less excited and it was no longer a sure thing. It may have been the brewer's $300 price tag, with beverage pods costing around $1 each, but KOLD became an almost-instant failure. Of course, Keurig did not admit that right away, but when the company was purchased by JAB Holdings and taken private, it was only a few months before the new owner killed the KOLD (offering full refunds to anyone who bought it), ending the company's cold-drink, single-serve experiment.

Keurig KOLD is not alone in being a product that arrived with heavy hype only to fail miserably. Call it Snakes on a Plane syndrome, but heavy media and public interest in a product do not mean people will actually buy it. And sometimes, companies can manufacture or buy hype when no real interest exists, leading to products that everyone knows about but nobody actually wants.

In many cases, these products changed the direction of the companies releasing them, making a big impact, just not in the way the company intended.

Keurig dropped its KOLD system when a heavily hyped launch was not followed by sales success. Image source: author.

Apple had a tablet before the iPad

Sometimes, it takes a big failure to lead to the path to great success. The Apple (NASDAQ: AAPL) Newton was released in 1993, 14 years before the iPhone and 17 years ahead of its successor, the iPad.

A big, clunky tablet that felt like the tablet version of a 1980s cellphone, Newton was marketed partly based on handwriting recognition. And while its technology was impressive for the time, it still did a fairly lousy job of recognizing what people were writing on it using its stylus tool. That may explain why Apple waited until 2015 before it attempted a similar product, the Apple Pencil, which is sold with the iPad Pro.

Newton hit the market at about $700 -- a very high price for a device that really did not do that much. It was breakthrough technology that simply was not useful enough to be worth the money. Apple scuttled the line just a few years after its launch and the product was part of the reason former CEO John Sculley was ushered out and company founder Steve Jobs was welcomed back.

Nobody wants an Amazon phone

Unlike some of the products on this list, Amazon.com's (NASDAQ: AMZN) phone was met with market skepticism from the time it first became rumored. But even though it was breaking into the smartphone business with a new operating system (in this case, a customized version of Android), the online retailer received some benefit of the doubt because of its success in entering the tablet market.

The problem is that the company did not follow the same formula it did when it released its Kindle tablets. Those devices were introduced as a pretty good alternative to the iPad, sold at a much cheaper price. Introduced at $99 versus the roughly $499 low-end iPad cost, Kindle Fire tablets built audience by being cheaper and integrating with its own sales infrastructure -- a valuable thing on a device a lot of people would use to read and watch video content.

With Fire Phone, however, Amazon deviated from the formula. Instead of making the device widely available, it was sold only through AT&T. That strategy worked for Apple in the early days of the iPhone, but at that time, the company essentially had the smartphone market to itself.

That was only one of the nails in the Fire Phone's coffin, though, and perhaps not the biggest one. Amazon's device may have been more hurt by two things: (1) the fact that its wow feature -- the ability to show products for sale in 3D -- was met with ambivalence and (2) price. Instead of going low and appealing to its massive user base, the company charged iPhone-like prices for the Fire Phone, introducing it at $650 retail or $199 with a two-year contract.

Those prices were lowered not long after release, but by then, it was already too late. Amazon killed off Fire Phone about a year after its launch and has made no moves to reenter the smartphone market.

You can't beat the real thing

The biggest sign that Coca-Cola's effort to replace its classic formulation with "New Coke" was a major flop was that people believed the company intentionally created the controversy in order to reignite interest in its flagship cola. That, however, was not the case and the company insists in its official history of the debacle that it had intended for people to like the beverage's new recipe.

On April 23, 1985, Coke replaced its long-standing formula with a new one, which people dubbed "New Coke." To say consumers were less than pleased might be putting it mildly.

"We set out to change the dynamics of sugar colas in the United States, and we did exactly that -- albeit not in the way we had planned," then-Chairman and CEO Roberto Goizueta said in 1995 at an employee event honoring the 10-year anniversary of "New Coke."

What happened was that the clamor for the return of the original formula was deafening. The company had awakened interest in its product, but not the one it was actually selling. Because of the outcry, Coca-Cola brought its classic formula under the "Classic Coke" moniker, admitting defeat for the new version of the cola even though it was still sold, eventually rechristened Coke II before being taken off U.S. shelves.

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Daniel Kline owns shares of Apple. He covered some of this material in his book Worst Ideas Ever. The Motley Fool owns shares of and recommends Amazon.com and Apple. The Motley Fool owns shares of SodaStream and has the following options: long January 2018 $90 calls on Apple and short January 2018 $95 calls on Apple. The Motley Fool recommends Coca-Cola. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.