He replaced Pepsi with Coca-Cola as the official white house drink.Īlthough Pepsi was giving tough competition in the US domestic market during this period, Coca-Cola remained dominant in the global market due to its political support from the US government.ĭespite Coca-Cola's brand philosophy being much more conservative than Pepsi's, by the '80s Coca-Cola had become associated with the Democratic party whereas Pepsi maintained its relationships with the Republicans. However, the political fortunes of these two companies changed again after Jimmy Carter of the Democratic Party became president in 1977. Later on, it was found that Pepsi, which was the leading cola brand of Chili at that time, expressed the need for US intervention in Chili to the then US secretary of state, Henry Kissinger. Like in 1973, an elected socialist government was ousted by a US-backed military coup. But the political and policy support during his tenure as president (1969-1974) helped 'Pepsi' to take a significant market share of 'Coca-Cola' not just in America but also in other countries.ĭuring this period, Pepsi also influenced different international political decisions taken by the US government. He helped Pepsi to grow before too, during his tenure as vice president. Later on, when he became 37th US president in 1969, he replaced Coca-Cola with Pepsi as the official drink in the White House. It began when Pepsi allegedly made Richard Nixon its brand ambassador during his tenure as Vice President (1953-1961). Some prominent politicians in the US were also involved in the cola war and this added a new dimension to their rivalry. In response to the rumour, Don Keough, the president of Coca-Cola at the time, stated in a famous interview, "we're not that smart." During this time, many Pepsi executives and business analysts labeled the incident as pre-planned by Coca-Cola policymakers. Soon Coke's sale surpassed the sale of Pepsi. However, the blunder of Coca-Cola to change its formula proved to be a blessing in disguise for the company as after this incident, people started to consume Coca-Cola more than ever. Their outrage compelled Coca-Cola to reintroduce its old formula under the brand name 'Coca-Cola Classic' in just six months. To make matters worse, they changed their original formula in 1985, which infuriated their loyal customers. Under the aggressive marketing strategy of Donald Kendall throughout the '70s and '80s, Pepsi introduced 'The Pepsi Challenge' in the Coca-Cola-dominated city Dallas in the Texas state in 1974.Īfter demonstrating that Pepsi was better than Coca-Cola in this blind taste, they decided to hold this campaign in other places of the US as well.įor the first time in history, Pepsi passed Coca-Cola by a 1.4 share point level in 1979.Ĭoca-Cola responded by introducing Diet Coke in 1980-84, doubling their advertising costs, and instituting some management and policy reforms.ĭespite its efforts, Coke was unable to reclaim its position. Meanwhile, Coca-Cola's excessive focus on overseas markets weakened the distribution network in the US market, which ultimately reduced its domestic lead to 2-1 to Pepsi. Targeting the young people through its aggressive marketing strategies, Pepsi soon, successfully, captured a large portion of the US domestic cola market. Under his visionary leadership, Pepsi merged with the snack food giant Frito-Lay to become PepsiCo. During his tenure, Pepsi worked with its bottlers to improve and modernise its plants while also improving store delivery service. This strategy seemed to work for Pepsi, as other Cola companies, including Coca-Cola, typically used 6.5 or 12-ounce bottles in those days.Īfter Alfred Steele, Donald Kendall became the CEO of Pepsi. But the game began to shift in favour of Pepsi, when the former marketing executive of Coca-Cola Alfred Steele became the CEO of Pepsi in 1950.Īiming at family use, Alfred Steele decided to introduce Pepsi in 26-Ounce bottles. However, Pepsi was struggling to keep itself in the competition due to bankruptcies in 19.
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