Pepsi won!

In the 1970’s, Pepsi had an idea based on the belief that their product is better than the other soda, Coca-Cola. Best is a dangerous metric. With that in mind, they set out to survey the market, asking random people to pick which soda they preferred based on a blind sip test. What they found was rather revealing.

The market surveying showed something they thought true for many years. The majority of people chose Pepsi Cola over the other soda, Coca-Cola. The evidence was clear. The more people they asked, the more people picked Pepsi over Coca-Cola. Pepsi was better than Coke. Pepsi is in fact the best.

Dy-no-mite!

Pepsi had proof and they started what has become known as the Cola wars. Their advertising went on a blitzkrieg. The Pepsi Challenge hit malls and promenades. Smiling people gasped as the brand was revealed after a blind sip test. The revelation was that they like Pepsi more than Coke. This was so effective, Coca-Cola's market share started to fall. Coca-Cola hit the drawing board. They analysed. By golly they will beat Pepsi as the better cola. In-house tests were run. Focus groups. More improvements. More tests. They had to beat Pepsi. Coke finally created a new formula that is better than Pepsi, and their test data proved it. Finance will be happy.  They improved the taste of Coke, not just improved it, but made it better than Pepsi. Eat my shorts!

"So much better you won't believe it.

We're rushing to bring you the

greatest Coca-Cola you ever had!

Get set for a surprise.

It's Coke - all Coke - but a giant step better.

Better tasting. Smoother feeling.

More refreshing, more inviting than ever.

New Coca-Cola will soon be dressed in its

brand-new best. Meanwhile, look for cans and

bottles marked "NEW." That's your Coke.

Now, more than ever...

Coke is it!"

"New Coke" hit the market late April of 1985.

On April 23, 1985, on a billboard close to Coca-Cola headquarters Atlanta, Georgia, an ad appeared. The ad was the same one that the then CEO of Pepsi-Cola, Roger Enrico run in The New York Times, which read:  “After 87 years of going at it eyeball to eyeball, the other guy just blinked. There is no question the long-term market success of Pepsi has forced this move.”

Pepsi beat Coca-Cola.

Pepsi outsold Coke in grocery stores. Pepsi made Coke blink, publicly. Consumers didn’t like New Coke. Children's birthday parties were ruined causing an increase in smoking. Taxi drivers got dehydrated. Dating took a dive. McDonalds had to give away free Dr Pepper. The Unabomber injures John Hauser. John Anthony Walker Jr is arrested for passing classified Naval communications onto the Soviets. America was in turmoil!

July 1985, less than 3 months after releasing "New Coke", Coca-Cola releases "Coca-Cola Classic", the original formula.

You can still find sealed cans of New Coke online if you wanted to taste it! Not to be confused with the Netflix "Stranger Things" limited series Coke cans,

Are you playing to win, or are you playing to play?

What we can learn from the Coke wars is that there are at least two games we can play and we need to know which game we are playing: are you playing to win or are you playing to play. The Finite game versus the Infinite game. The former requires a winner, and at least one loser. Crucially, and there is no way around this:  the game has to come to an end in order for a winner to win. Pepsi was playing the Finite game with Coke, and Coke decided to join them. Coke lost. Coke lost because they were playing someone else’s measure of success.

To win a game, it has to end.

Both companies made changes subsequent the Coke Wars. Coke realised their brand equity when they “gifted” the old formula back to the customer. They changed tactics in supermarkets. They returned to their brand and their advertising returned to family and sharing moments. Pepsi returned to their “New Generation” branding of youth, modernity, and being dynamic. Later, Pepsi merged with Lay’s Chips, becoming PepsiCo and focussed on customers buying a drink and a snack.

Other Case Studies

Dove is a good example of a brand not shadowboxing competitors. "Real Beauty" has been the message for Dove for decades. It did not win attention by trying to out-punch other soap or skincare brands. Dove kept reinforcing its belief about beauty, self-image, and how women want to be seen.

Unilever says that Dove has delivered its highest underlying sales growth in more than a decade in 2023, generating over $6 billion for business. Whether you agree with every execution or not, the point stands: consistency of meaning is an important asset in branding. What comes to mind when you read "Lifebuoy" or "LUX"? (read: 20 years on: Dove and the future of Real Beauty) Similarly, if I were to ask you for advice as a new parent, which car will be the safest for my child going forward? I bet if it isn't the first name you utter, it will likely be the second: Volvo. For decades Volvo kept beating their drum. Let me also be very clear, this isn't about scamming customers, it's about authenticity and trust. Safety is not something Volvo just says, it is what they live by, and history proves it.

In 2008, Volvo went one step further. It set a new Big Hairy Audacious Goal called "Vision 2020." Building safe cars was no longer enough. As Håkan Samuelsson, President and CEO of Volvo cars put it: Volvo Cars has a vision that nobody should be seriously injured or killed in a new Volvo." (read: Volvo's Vision 2020)

Key takeaways

Advertising isn't a competition. It is especially not a competition with a brand you perceive to be a rival. Beating your "competition" might just hurt you in the end, either in market share, or, in money spent spinning your wheels flinging mud. Coca-Cola's real mistake was not that it lost to Pepsi on product, it was stepping into a finite game with Pepsi. Pepsi set the definition for victory. New Coke beat them beat Pepsi, but Coca-Cola lost to their own customers. Brands that endure are not brands that try and stand out from the crowd. Brands that endure are brands that are recognisable and unmistakable. They are because they focus on showing who they are, not who their compete with. That doesn't mean you can poke some fun at others from time to time.

What is your approach with your advertising, with your brand? Are you playing the finite game? Are you looking at your competitors, inventing measures of success that you think will beat your competitor? What do your customers care about? What are they saying about your product, your brand? Why are they buying your product or service? Remember, you are not your customer, nor is your "competition". See how we can help you become Unmistakable.