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How Pepsi Became Successful

Pepsi has been around for many generations and is one of the top brands in the cut-throat food and beverage industry. How has Pepsi managed to stand the test of time, and still remain one of the major competitors in the industry? Here is how Pepsi managed to achieve success in one of the largest industries in the world.

What is Pepsi?

Pepsi is a carbonated soft drink that is manufactured by PepsiCo, a multinational food, snack and beverage company in America. It is one of the largest food and beverage businesses in the world, coming in second only to Nestle. Pepsi has multiple variants such as Diet Pepsi, Pepsi Twist, Pepsi Zero Sugar, Pepsi Vanilla and many more.

The History of Pepsi

The iconic soft drink was originally introduced as Brad’s Drink by Caleb Bradham in the United States, 1893- almost 130 years ago! Bradham produced and sold the drink in his drugstore in New Bern, North Carolina. It was then renamed to Pepsi-Cola in 1898 as it was marketed to relieve dyspepsia or more commonly known as indigestion, and cola referred to the drink’s cola flavour. It was later shortened to Pepsi in 1961.

Bradham moved the manufacturing of Pepsi-Cola from his drugstore to a warehouse in 1903, and in 1909 the drink received its first celebrity endorsement: automobile race pioneer Barney Oldfield who described the drink as "A bully drink...refreshing, invigorating, a fine bracer before a race."

However, in 1923 the brand filed for bankruptcy due to the unstable sugar prices that was a direct result of World War I. It was then reincorporated and reorganised in the 1920s multiple times in an effort to revive the brand, which failed. In 1931, the brand was purchased buy Charles Guth who reformulated the drink’s formula and became the founder of the modern day Pepsi.

The Expansion of Pepsi

Pepsi began gaining popularity during the Great Depression, doubling their profits with a campaign that encouraged their consumers to double the volume their nickels could purchase. Pepsi began to expand to other countries in the early 21st century, particularly Russia which was its second largest market.

Currently, Pepsi is distributed to over 200 countries across the world, with more than 1 billion products being consumed by customers in a day. Pepsi is estimated to be valued at over $100 billion US dollars.

Pepsi's Marketing Strategy

Pepsi ensures that its products are plentiful, readily available and affordable which appeals to people of different income segments across the world. They also invest a lot in their packaging and product innovation to attract new customers and retain their older ones. Aside from that, the company makes sure its presence on the mainstream media as well as the digital media is strong by utilising all available channels and platforms. They also frequently collaborate with artists and celebrities such as Beyonce, Michael Jackson, David Beckham and Robbie Williams.

Pepsi has an array of notable campaigns such as ‘Joy of Pepsi’, which showed that Pepsi knew how to advertise with history and not just rely on celebrity endorsements. In order to overcome the language barrier when penetrating the international market, Pepsi commissioned 70 emojis as part of an innovative campaign to appeal to younger consumers, along with the hashtag #sayitwithpepsi. They also ensure their material and campaigns are properly translated to avoid any miscommunication or misunderstanding in international markets.

Why is Pepsi so Successful?

Whereas Coca-Cola seems to target an older audience as their brand reflects an image of old time values and reliability, Pepsi targets the younger generation, and this is reflected in their campaigns and bold branding. Pepsi believes that if their product can be successfully adopted by the younger generation, it could establish a loyal customer for life.

Pepsi’s success can also be attributed to its advertising. The company spends about $220 million dollars a year in advertising alone. This gigantic budget allocated for advertisements allows the brand to reinforce their products with advertisements and promotions. It also allows the brand to reach their massive consumer base quickly if they launch a new product.

All in all, Pepsi’s success shows us how important perseverance and advertising is, as well as selecting the right market for your business.


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