A Report on Pepsi

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Pepsi
Pepsi

Pepsi is a soft drink that is produced and manufactured by PepsiCo. It is sold in retail stores, restaurants, cinemas and from vending machines. The drink was first made in the 1890s by pharmacist Caleb Bradham in New Bern, North Carolina. The brand was trademarked on June 16, 1903. There have been many Pepsi variants produced over the years since 1898, including Diet Pepsi, Crystal Pepsi, Pepsi Twist, Pepsi Max, Pepsi Free, Pepsi AM, Pepsi Samba, Pepsi Blue, Pepsi Gold, Pepsi Holiday Spice, Pepsi Jazz, Vanilla Pepsi, Pepsi X (available in Finland and Brazil), Pepsi Next (available in Japan and South Korea), Pepsi Raw, Pepsi Retro in Mexico, Pepsi One, Pepsi Ice Cucumber and Pepsi White in Japan.

In October 2008, Pepsi announced they would be redesigning its logo and re-branding many of its products by early 2009. In 2009, Pepsi, Diet Pepsi and Pepsi Max began using all lower-case fonts for name brands, and Diet Pepsi Max was re-branded as Pepsi Max. The brand’s blue and red globe trademark became a series of “smiles,” with the central white band arcing at different angles depending on the product. As of January 2009, Pepsi’s newer logos have only been adopted in the United States. Currently, Pepsi Wild Cherry and Pepsi ONE are the only two products that still use their previous design. Diet Pepsi Wild Cherry, Diet Pepsi Lime, and Diet Pepsi Vanilla received the redesign.

Origins

Pepsi was originally named “Brad’s Drink”, after its creator, a pharmicist in New Bern, North Carolina. It was created in the summer of 1893 and was later renamed Pepsi Cola in 1898, possibly due the digestive enzyme pepsin and kola nuts used in the recipe. Bradham sought to create a fountain drink that was delicious and would aid in digestion and boost energy.

Another theory is that Bradham and his customers simply thought the name “Pepsi” sounded good and reflected the fact that the drink had some kind of “pep” in it because it was a carbonated drink.

And another theory is that the word Pepsi was chosen because it reflected phonetically the sound of a can being opened, the sound “pop” “schi”, was condensed and simplified in the name “Pepsi”. This theory can be considered folklore only, since at the time of the naming of the drink, Pepsi was sold in glass bottles and not metal cans; and the pop top lid producing Pepsi’s oddly phonetic sound wouldn’t be invented for another forty years.

In 1903, Bradham moved the bottling of Pepsi-Cola from his drugstore into a rented warehouse. That year, Bradham sold 7,968 gallons of syrup. The next year, Pepsi was sold in six-ounce bottles, and sales increased to 19,848 gallons. In 1929, Pepsi received its first logo redesign since the original design of 1905. In 1926, the logo was changed again. In 1929, automobile race pioneer Barney Oldfield endorsed Pepsi-Cola in newspaper ads as “A bully drink…refreshing, invigorating, a fine bracer before a race”.

In 1931, the Pepsi-Cola Company went bankrupt during the Great Depression– in large part due to financial losses incurred by speculating on wildly fluctuating sugar prices as a result of World War I. Assets were sold and Roy C. Megargel bought the Pepsi trademark. Eight years later, the company went bankrupt again. Pepsi’s assets were then purchased by Charles Guth, the President of Loft Inc. Loft was a candy manufacturer with retail stores that contained soda fountains. He sought to replace Coca-Cola at his stores’ fountains after Coke refused to give him a discount on syrup. Guth then had Loft’s chemists reformulate the Pepsi-Cola syrup formula.

Rise

During the Great Depression, Pepsi gained popularity following the introduction in 1936 of a 12-ounce bottle. Initially priced at 10 cents, sales were slow, but when the price was slashed to five cents, sales increased substantially. With a radio advertising campaign featuring the jingle “Pepsi cola hits the spot / Twelve full ounces, that’s a lot / Twice as much for a nickel, too / Pepsi-Cola is the drink for you,” Pepsi encouraged price-watching consumers to switch, obliquely referring to the Coca-Cola standard of six ounces a bottle for the price of five cents (a nickel), instead of the 12 ounces Pepsi sold at the same price. Coming at a time of economic crisis, the campaign succeeded in boosting Pepsi’s status. In 1936 alone 500,000,000 bottles of Pepsi were consumed. From 1936 to 1938, Pepsi-Cola’s profits doubled.

Pepsi’s success under Guth came while the Loft Candy business was faltering. Since he had initially used Loft’s finances and facilities to establish the new Pepsi success, the near-bankrupt Loft Company sued Guth for possession of the Pepsi-Cola company. A long legal battle, Guth v. Loft, then ensued, with the case reaching the Delaware Supreme Court and ultimately ending in a loss for Guth.

Niche marketing

1940s advertisement specifically targeting African Americans.

Walter Mack was named the new President of Pepsi-Cola and guided the company through the 1940s. Mack, who supported progressive causes, noticed that the company’s strategy of using advertising for a general audience either ignored African Americans or used ethnic stereotypes in portraying blacks. He realized African Americans were an untapped niche market and that Pepsi stood to gain market share by targeting its advertising directly towards them. To this end, he hired Hennan Smith, an advertising executive “from the Negro newspaper field” to lead an all-black sales team, which had to be cut due to the onset of World War II. In 1947, Mack resumed his efforts, hiring Edward F. Boyd to lead a twelve-man team. They came up with advertising portraying black Americans in a positive light, such as one with a smiling mother holding a six pack of Pepsi while her son (a young Ron Brown, who grew up to be Secretary of Commerce) reaches up for one. Another ad campaign, titled “Leaders in Their Fields”, profiled twenty prominent African Americans such as Nobel Peace Prize winner Ralph Bunche and photographer Gordon Parks.

Boyd also led a sales team composed entirely of blacks around the country to promote Pepsi. Racial segregation and Jim Crow laws were still in place throughout much of the U.S., so Boyd’s team faced a great deal of discrimination as a result, from insults by Pepsi co-workers to threats by Ku Klux Klan.<href=”#cite_note-latboyd-7″ title=””>[8] On the other hand, they were able to use racism as a selling point, attacking Coke’s reluctance to hire blacks and support by the chairman of Coke to segregationist Governor of Georgia Herman Talmadge. As a result, Pepsi’s market share as compared to Coke’s shot up dramatically. After the sales team visited Chicago, Pepsi’s share in the city overtook that of Coke for the first time.

This focus on the market for black people caused some consternation within the company and among its affiliates. They did not want to seem focused on black customers for fear white customers would be pushed away. In a meeting at the Waldorf-Astoria Hotel, Mack tried to assuage the 500 bottlers in attendance by pandering to them, saying, “We don’t want it to become known as a nigger drink.” After Mack left the company in 1950, support for the black sales team faded and it was cut.

Marketing

A bottle of Pepsi with its 2003-2009 logo. This Pepsi logo is still used with Pepsi Wild Cherry, Pepsi ONE, and in many countries.

In 1975, Pepsi introduced the Pepsi Challenge marketing campaign where PepsiCo set up a blind tasting between Pepsi-Cola and rival Coca-Cola. During these blind taste tests the majority of participants picked Pepsi as the better tasting of the two soft drinks. PepsiCo took great advantage of the campaign with television commercials reporting the test results to the public.

In 1976 Pepsi, RKO Bottlers in Toledo, Ohio hired the first female Pepsi salesperson, Denise Muck, to coincide with the United States bicentennial celebration.

In 1996, PepsiCo launched the highly successful Pepsi Stuff marketing strategy. By 2002, the strategy was cited by Promo Magazine as one of 16 “Ageless Wonders” that “helped redefine promotion marketing.”

In 2007, PepsiCo redesigned their cans for the fourteenth time, and for the first time, included more than thirty different backgrounds on each can, introducing a new background every three weeks. One of their background designs includes a string of repetitive numbers 73774. This is a numerical expression from a telephone keypad of the word “Pepsi.”

In late 2008, Pepsi overhauled their entire brand, simultaneously introducing a new logo and a minimalist label design. The redesign was comparable to Coca-Cola’s earlier simplification of their can and bottle designs. Due to the timing of the new logo release, some have criticised the logo change, as the new logo looked strikingly similar to the logo used for Barack Obama‘s successful presidential campaign, implicating a bias towards the President. Also in 4th quarter of 2008 Pepsi teamed up with Google/Youtube to produce the first daily entertainment show on Youtube for Youtube. This daily show deals with pop culture, internet viral videos, and celebrity gossip. Poptub is refreshed daily from Pepsi.

Since 2007, Pepsi, Lay’s, and Gatorade have had a “Bring Home the Cup™,” contest for Canada’s biggest hockey fans. Hockey fans were asked to submit content (videos, pictures or essays) for a chance at winning a party in their hometown with The Stanley Cup and Mark Messier.

In 2009, “Bring Home the Cup™,” changed to “Team Up and Bring Home the Cup™.” The new installment of the campaign asks for team involvement and an advocate to submit content on behalf of their team for the chance to have the Stanley Cup delivered to the team’s hometown by Mark Messier.

Slogans

A large advertisement made to resemble a Pepsi cup at Nickelodeon Universe in the Mall of America.

The 2009 Pepsi bottle design.

  • 1939-1950: “Twice as Much for a Nickel”
  • 1950: “More Bounce to the Ounce”
  • 1950-1957: “Any Weather is Pepsi Weather”
  • 1957-1958: “Say Pepsi, Please”
  • 1958-1961: “Be Sociable, Have a Pepsi”
  • 1961-1963: “Now It’s Pepsi for Those Who Think Young”
  • 1963-1967: “Come Alive, You’re in the Pepsi Generation“.
  • 1967-1969: “(Taste that beats the others cold) Pepsi Pours It On”.
  • 1969-1975: “You’ve Got a Lot to Live, and Pepsi’s Got a Lot to Give”
  • 1975-1977: “Have a Pepsi Day”
  • 1977-1980: “Join the Pepsi People (Feeling Free)”
  • 1980-1981: “Catch That Pepsi Spirit” David Lucas composer
  • 1981-1983: “Pepsi’s got your taste for life”
  • 1983-1984: “Pepsi Now! Take the Challenge!”
  • 1984-1991: “Pepsi. The Choice of a New Generation” (commercial with Michael Jackson, featuring Pepsi version of Billie Jean)
  • 1986-1987: “We’ve Got The Taste” (commercial with Tina Turner)
  • 1987-1990: “Pepsi’s Cool” (commercial with Michael Jackson, featuring Pepsi version of Bad)
  • 1990-1991: “You got the right one Baby UH HUH” ( sung by Ray Charles for Diet Pepsi )
  • 1991-1992: “Gotta Have It”/”Chill Out”
  • 1992-1993: “Be Young, Have Fun, Drink Pepsi”
  • 1993-1994: “Right Now”Van Halen song for the Crystal Pepsi advertisment.
  • 1994-1995: “Double Dutch Bus” Pepsi song sung by Brad Bentz.
  • 1995: “Nothing Else is a Pepsi”
  • 1995-1996: “Drink Pepsi. Get Stuff.” Pepsi Stuff campaign
  • 1996-1997: “Pepsi:There’s nothing official about it” (During the Wills World Cup (cricket) held in India/Pakistan/Sri Lanka)
  • 1997-1998: “Generation Next” – with the Spice Girls.
  • 1998-1999: “It’s the cola” (100th anniversary commercial)
  • 1999-2000: “For Those Who Think Young”/”The Joy of Pepsi-Cola” (commercial with Britney Spears/commercial with Mary J. Blige)
  • 2000-2003: “Aazadi dil ki” (Hindi – meaning “Freedom of the Heart”)(India)
  • 2003: “It’s the Cola”/”Dare for More” (Pepsi Commercial)
  • 2003-2005: “Yeh Pyas Hai Badi” (Hindi meaning “This thirst is too much”)(India)
  • 2005-2006: “An ice cold Pepsi. It’s better than sex!” (Larry Sypolt)
  • 2006-2007: “Why You Doggin’ Me”/”Taste the one that’s forever young” Commercial featuring Mary J. Blige
  • 2007-2008: “More Happy”/”Taste the once that’s forever young” (Michael Alexander)
  • 2008: “Yeh hai Youngistaan Meri Jaan!” (Urdu) – meaning “This is the Young era my dear” (India and Pakistan)
  • 2008: “Pepsi Stuff” Super Bowl Commercial (Justin Timberlake)
  • 2008: “?epsi is #1” ?v commercial (Luke Rosin)
  • 2008: “Pepsify karo gai!” Commercial (Urdu – meaning “Wanna Pepsify!”) (Pakistan) (Featuring. Adnan Sami and Annie)
  • 2008-2009: “Something for Everyone.”
  • 2009-present: “Refresh Everything” and (during many commercials) “Every Generation Refreshes The World”
Pepsi man

Pepsi man is an official Pepsi mascot from Pepsi’s Japanese corporate branch. The design of the Pepsi man character is attributed to Canadian comic book artist Travis Charest, created sometime around the mid 1990s. Pepsi man took on three different outfits, each one representing the current style of the Pepsi can in distribution. Twelve commercials were created featuring the Pepsiman. His role in the advertisements is to appear with Pepsi to thirsty people or people craving soda. Pepsiman happens to appear at just the right time with the product. After delivering the beverage, sometimes Pepsi man would encounter a difficult and action oriented situation which would result in injury.

Pepsi man was featured as a Japanese Exclusive Transformers toy “Pepsi Convoy,” which was based on G1 Optimus Prime. In 1996, Sega-AM2 released the Sega Saturn version of their arcade fighting game Fighting Vipers. In this game Pepsi man was included as a special character, with his specialty listed as being the ability to “quench one’s thirst”. He does not appear in any other version or sequel. In 1999, KID developed a video game for the PlayStation entitled Pepsi man. As Pepsi man, the player runs, skateboards, rolls, and stumbles through various areas, avoiding dangers and collecting cans of Pepsi all while trying to reach a thirsty person as in the commercials.

Bans in India

Pepsi arrived on the black market in India in 1988. In 2003 and again in 2006, the Centre for Science and Environment (CSE), a non-governmental organization in New Delhi, claimed that soda drinks produced by manufacturers in India, including both Pepsi and Coca-Cola, had dangerously high levels of pesticides in their drinks. Both PepsiCo and The Coca-Cola Company maintain that their drinks are safe for consumption and have published newspaper advertisements that say pesticide levels in their products are less than those in other foods such as tea, fruit and dairy products. In the Indian state of Kerala, sale and production of Pepsi-Cola, along with other soft drinks, were banned in 2006 following partial bans on the drinks in schools, colleges and hospitals in five other Indian states On September 22, 2006, the High Court in Kerala overturned the Kerala ban ruling that only the central government can ban food products.

Rivalry with Coca-Cola

According to Consumer Reports, in the 1970s, the rivalry continued to heat up the market. Pepsi conducted blind taste tests in stores, in what was called the “Pepsi Challenge“. These tests suggested that more consumers preferred the taste of Pepsi (which is believed to have more lemon oil, less orange oil, and uses vanillin rather than vanilla) to Coke. The sales of Pepsi started to climb, and Pepsi kicked off the “Challenge” across the nation. This became known as the “Cola Wars.”

In 1985, The Coca-Cola Company, amid much publicity, changed its formula. The theory has been advanced that New Coke, as the reformulated drink came to be known, was invented specifically in response to the Pepsi Challenge. However, a consumer backlash led to Coca-Cola quickly introducing a modified version of the original formula (removing the expensive Haitian lime oil and changing the sweetener to corn syrup) as Coke “Classic”.

In the U.S., Pepsi’s total market share was about 31.7 percent in 2004, while Coke’s was about 43.1 percent.

Overall, Coca-Cola continues to outsell Pepsi in almost all areas of the world. However, exceptions include Saudi Arabia; Pakistan (Pepsi has been a dominant sponsor of the Pakistan cricket team since the 1990s); the Dominican Republic; the Canadian provinces of Quebec, Newfoundland and Labrador and Prince Edward Island; and Guatemala.

Pepsi had long been the drink of Canadian Francophones and it continues to hold its dominance by relying on local Québécois celebrities (especially Claude Meunier, of La Petite Vie fame) to sell its product. PepsiCo use the slogan “here, it’s Pepsi” (Ici, c’est Pepsi) to answer to Coca-cola publicity “Everywhere in the world, it’s Coke” (Partout dans le monde, c’est Coke).

By most accounts, Coca-Cola was India’s leading soft drink until 1977 when it left India after a new government ordered The Coca-Cola Company to turn over its secret formula for Coke and dilute its stake in its Indian unit as required by the Foreign Exchange Regulation Act (FERA). In 1988, PepsiCo gained entry to India by creating a joint venture with the Punjab government-owned Punjab Agro Industrial Corporation (PAIC) and Voltas India Limited. This joint venture marketed and sold Lehar Pepsi until 1991 when the use of foreign brands was allowed; PepsiCo bought out its partners and ended the joint venture in 1994. In 1993, The Coca-Cola Company returned in pursuance of India’s Liberalization policy. In 2005, The Coca-Cola Company and PepsiCo together held 95% market share of soft-drink sales in India. Coca-Cola India’s market share was 52.5%.

A sticker from a USSR-produced Pepsi bottle. The logo shown is a version used from 1973-91.

In Russia, Pepsi initially had a larger market share than Coke but it was undercut once the Cold War ended. In 1972, Pepsico company struck a barter agreement with the then government of the Soviet Union, in which Pepsico was granted exportation and Western marketing rights to Stolichnaya vodka in exchange for importation and Soviet marketing of Pepsi-Cola. <href=”#cite_note-24″ title=””>[25] <href=”#cite_note-25″ title=””>[26] This exchange led to Pepsi-Cola being the first foreign product sanctioned for sale in the U.S.S.R..

Reminiscent of the way that Coca-Cola became a cultural icon and its global spread spawned words like “coca colonization“, Pepsi-Cola and its relation to the Soviet system turned it into an icon. In the early 1990s, the term “Pepsi-stroika” began appearing as a pun on “perestroika“, the reform policy of the Soviet Union under Mikhail Gorbachev. Critics viewed the policy as a lot of fizz without substance and as an attempt to usher in Western products in deals there with the old elites. Pepsi, as one of the first American products in the Soviet Union, became a symbol of that relationship and the Soviet policy. This was reflected in Russian author Victor Pelevin’s book “Generation P“.

In 1989, Billy Joel mentions the rivalry between the two companies in the song We Didn’t Start The Fire. The line “Rock & Roller Cola Wars” refers to Pepsi and Coke’s usage of various musicians in their advertising campaigns. Coke used Paula Abdul,while Pepsi used Michael Jackson. They then continued to try to get other musicians to advertise their beverages. Whilst filming the Pepsi advert Michael Jackson burned his hair.

In 1992, following the Soviet collapse, Coca-Cola was introduced to the Russian market. As it came to be associated with the new system, and Pepsi to the old, Coca-Cola rapidly captured a significant market share that might otherwise have required years to achieve. By July 2005, Coca-Cola enjoyed a market share of 19.4 percent, followed by Pepsi with 13 percent.

Ingredients

Pepsi-Cola contains basic ingredients found in most other similar drinks including carbonated water, high fructose corn syrup, sugar, colorings, phosphoric acid, caffeine, citric acid, and natural flavors. The caffeine-free Pepsi-Cola contains the same ingredients minus the caffeine.

The original Pepsi-Cola recipe was available from documents filed with the court at the time that the Pepsi-Cola Company went bankrupt in 1929. The original formula contained neither cola nor caffeine.

Competitors
Notes
  1. “Brad’s drink” becomes “Pepsi Cola”
  2. The History of the Birthplace of Pepsi-Cola
  3. “The History of Pepsi-Cola”, sodamuseum.bigstep.com paragraph 8
  4. 1939 Radio Commaial (Twice as Much for a Nickel)
  5. Jones, Eleanor & Ritzmann, Florian. “Coca-Cola at Home”. Retrieved June 17, 2006
  6. Martin, Douglas (May 6, 2007). “Edward F. Boyd Dies at 92; Marketed Pepsi to Blacks.”. The New York Times. http://www.nytimes.com/2007/05/06/business/06boyd.html?_r=1&ref=obituaries&oref=slogin. Retrieved on 2007-05-05.
  7. Archer, Michelle (January 22, 2007). “Pepsi’s challenge in 1940s: Color barrier”. USA Today.
  8. Stewart, Jocelyn Y (May 5, 2007). “Edward Boyd, 92; Pepsi ad man broke color barriers”. Los Angeles Times. http://www.latimes.com/news/obituaries/la-me-boyd5may05,0,7240282,full.story?coll=la-news-obituaries. Retrieved on 2007-05-05.
  9. Tavis, Smiley (February 27, 2007). “Edward Boyd” (interview). PBS. http://www.pbs.org/kcet/tavissmiley/archive/200702/20070227_boyd.html. Retrieved on 2007-05-04.
  10. SODAmuseum.com “The History of Pepsi-Cola”, sodamuseum.bigstep.com, paragraph 31
  11. PepsiCo – Company – Honors (2002), Promo Magazine, 2002.
  12. Pepsi Can Gallery
  13. New Pepsi Logo Looks Like Obama Campaign Logo
  14. PepsiCo India
  15. Pepsi, Coke contain pesticides: CSE
  16. Pesticides in Soft Drinks(Pepsico and Coca-Cola) In-Depth Section
  17. Cola sales down 10% on state bans
  18. Indian state bans Pepsi and Coke
  19. Thomas, V.M. Indian state lifts cola ban
  20. “Beverage Digest Press Release”, Beverage Digest, March 4, 2005 (PDF)
  21. [http://www.strategymag.com/articles/magazine/20041015/vive.html “Vive la difference ‘Does that mean I have to have a separate campaign?”], Strategy Magazine, October 2004
  22. “The Pepsi ‘Meunier’ Campaign” (PDF). Canadian Advertising Success Stories (Cassies) Case Library. http://www.cassies.ca/caselibrary/winners/PepsiMeunier.pdf. Retrieved on 2007-08-21.
  23. “India: Soft Drinks, Hard Cases”, The Water Dossier, March 14, 2005
  24. “Fizzical Facts: Coke claims 60% mkt share in India”, Times News Network, August 5, 2005
  25. Robert Laing (2006-03-28). “Pepsi’s comeback, Part II”. Mail & Guardian online. http://www.mg.co.za/articlePage.aspx?articleid=267835&area=/insight/insight__economy__business/. Retrieved on 2007-07-21.

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