CNN+ Joins Such Iconic Failures As The Edsel, New Coke, And Alf Landon

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At least Google+ lasted nine years. CNN+ barely made it past nine days. The colossal flop doesn’t even merit a “crash and burn” label because that would imply it made it past the launch. The embarrassing fact is CNN+ never got off the ground. Maybe “stillborn” would be a better epitaph.

Every generation needs its version of the Edsel, Ford’s classic foray into product infamy and marketing case studies. The Edsel belongs to the Boomers. Gen X-ers get New Coke. The Millennials now have CNN+. Heck, if you want to go back far enough, you can hang Alf Landon on the Silent Generation (parents of the Boomers).

Each of these failures feature a common trait: hubris. Those in charge simply believed they knew more than the markets they served. And they had willing accomplices to encourage this false confidence.

The curious case of Alf Landon is a great example. Landon lost the 1936 Presidential election by a lopsided 523-8 electoral votes, with FDR winning 46 of the 48 states and garnering 61% of the popular vote.

A notoriously poor campaigner, Landon maybe didn’t feel the need to promote himself. After all, the Depression was still raging, he was endorsed by 1936 Berlin Olympics hero Jesse Owens, and The Literary Digest poll projected him to win 57% of the vote.

It was this last item that probably boosted Landon’s confidence the most. The magazine had successfully predicted the winners of the previous five presidential elections.

When the results came in, the establishment couldn’t believe it. It turned out the methodology used by The Literary Digest was not scientific. It was more akin to those internet polls we see all the time. The faux pas was so egregious it became the staple of comedians who joked, “I can’t believe Landon lost. Everyone in my country club voted for him.”

Within 18 months, it’s credibility irreversibly damaged, The Literary Digest closed its doors. Oddly, another polling agency used modern “scientific advertising” random sampling techniques to produce a more accurate poll. It correctly predicted the outcome of the 1936 presidential election. The name of the man behind this effort was an advertising executive by the name of George Gallup. The Gallup Poll became a mainstay of subsequent presidential elections for decades after.

You’re probably more familiar with the story of the Edsel. At least Ford was smart enough to poll consumers about what they wanted. Unfortunately, for some reason Ford decided to ignore what they said. Further exasperating this, the car was developed in secret, so there was no way to “test market” certain aspects while it was being developed.

Ford promised “the car of the future” when the Edsel debuted and charged accordingly. It turns out the public thought “the future” was ugly and weren’t inclined to spend big bucks for it, especially during a recession. Making matters worse, Ford offered 18 different versions of the Edsel. This was well before research in behavioral economics defined how too many choices paralyzes decision making.

Right on time about a quarter of a century later, Coke determined it was a good idea to ditch a very successful product (the original Coke) and replace it wholesale with a brand-spanking new product (New Coke). Ironically, this time the company listened to what market research told them. Developed to combat Pepsi’s growing market share, consumer testing revealed New Coke not only beat Pepsi in taste tests, it also beat the original Coke.

Coca-Cola placed all their chips on red and went all in with New Coke, pulling the original version off the shelves. And why not? Over 190,000 blind taste tests in the U.S. and Canada told them this was the smart thing to do.

Only it wasn’t. The company had underestimated the success of its nearly century long branding campaign. Loyal customers felt cheated. That’s something blind taste tests can’t tell you. And Pepsi didn’t help matters. They squeezed the marketing mistake for everything they could, famously saying “the other guy blinked.”

Not only did New Coke fail on the store shelves, it also failed in the stock market. Upon its release, shares of Coca-Cola fell while Pepsi’s rose.

The Edsel and New Coke stand at the pantheon of spectacular new product failures. Most “All Time Failure” lists will include these two, often as #1 and #2 on the list.

They may now have some competition for those spots.

The complete analysis has yet to come down, but CNN+ and its DOA arrival in the streaming market pretty much guarantees it will be part of the “Triumvirate of Failures” on future marketing lists.

Based on what we know today, what lessons can we learn from the quick demise of CNN+?

First and foremost, there is currently and has always been a question as to how far people will go to pay for news. Newspapers feel this pinch all the time. So do radio and video news producers. Since much of the news, especially big stories like the kind that boost CNN ratings, are available for free on the internet or part of a standard cable-TV subscription, it’s tough to convince consumers to pay for it unless it offers a very differentiating value.

The best example of this differentiation is the Wall Street Journal. It can afford to charge steep rates because its subscribers expect to more than make up for the cost of a subscription in the investment gains they’ll see from reading the content available in the WSJ. By the way, the same logic applies to CNBC, (at least the original “Financial News Network” version of that channel), which does offer a “pro” premium subscription to its free channel, but it has yet to be the “must have” subscription status that the WSJ has.

CNN+ did not offer this value. Instead, it opted to present a different kind of value: premium personalities. There’s no indication if they did solid market research, but it’s clear the public did not consider “premium personalities” a value.

CNN+ might have had more success if it would have concentrated on Hollywood dirt for its content. It seems like people are always interested in gossip, and CNN would have had the advantage of being considered a good journalism source, making people believe CNN’s dirt might be dirtier than most. There are probably more than enough folks willing to pay for this dirty dirt.

As time puts the CNN+ fiasco behind us, and former employees have a chance to spill the beans, we’ll learn more about why the much anticipated streaming service evaporated in just a few weeks.

Until then, keep watching those “all-time flop” lists to see when CNN+ ends up.