Marketing: Custom Edition for Texas A&M University 17th Edition by William Pride,Ferrell

Exercise 19

Pepsi Takes Different Spins on Advertising
Almost since Pepsi's creation, Pepsi and Coca-Cola have been fighting for dominance in the soft drink market. These "cola wars" have seen victories and defeats on both sides, with Pepsi gaining market share during some years and Coca-Cola gaining dominance during other years. With much of the population unable to tell the difference between the two, the question remains how to convince consumers to prefer one brand over the other. Many consumers tend to become brand loyal early on in life, requiring soft drink makers to develop creative ways to change consumer perceptions about the value of their brands. Advertising is the primary means that these businesses use to persuade consumers to favor their products.
For many years, Pepsi has been an advertising guru, spending millions on a variety of media to get its products in front of consumers. The company became skilled at using celebrity pop stars in advertisements promoting its products, such as Michael Jackson, Ray Charles, and Britney Spears. Because the Super Bowl tends to give brands some of the best exposure, Pepsi has had a constant presence at the Super Bowl for many years. In 2010, however, Pepsi deviated from its 23-year practice of Super Bowl advertisements and did something entirely different to market its brand. The company decided to engage in a type of institutional advertising in which it would promote the "social good" by agreeing to fund projects to make the world a better place. The company took the $20 million it would have spent on the Super Bowl and appropriated it to fund the Pepsi Refresh Project.
The Pepsi Refresh Project uses social media to create a platform where consumers can vote on projects to receive funding. Consumers are invited to submit ideas on the Pepsi Refresh social media site for projects that would help improve society. These project ideas are listed in four categories: (1) arts and music, (2) communities, (3) education, and (4) the Pepsi Challenge. The Pepsi Challenge asks questions about how consumers would change the world. Those with the best answers receive project funding. Consumers vote on which project ideas they like the best, and Pepsi provides money to the winners to make their project ideas a reality. Pepsi accepts 1,000 ideas each month.
The Pepsi Refresh project generated positive publicity from many major news outlets. While this publicity helped to promote the project, Pepsi had to engage in significant advertising to inform the public about the new initiative. Advertising media included TV clips, posters, buses, and even the sides of buildings. Mottos like "Vote Today, Change Tomorrow" and "Every Pepsi Refreshes the World" helped spread the image of Pepsi as a socially responsible company. While Pepsi's objectives for the project were to increase sales, it also wanted to differentiate itself from its competitors and address issues that the younger generation considered to be important. Pepsi-funded projects ranged from SOS animal shelters to eco-friendly theaters. The Pepsi Refresh social media site received 20,000 daily comments.
In 2011, Pepsi decided to resume its Super Bowl advertisements. Interestingly, Pepsi decided to use consumers once again to help it come up with a memorable Super Bowl advertisement for its Doritos brand. Similar to the Pepsi Refresh Project, consumers could submit ads and have other consumers vote on them. The winning ad was featured during the Super Bowl. This type of consumer-generated advertising encourages stakeholders to participate and interact with the brand, creating a high-involvement situation that can increase consumer loyalty.
Although Pepsi began advertising again during the Super Bowl, it also kept the Pepsi Refresh Project going. The company made the big decision to go global, extending the Pepsi Refresh Project to Europe, Asia, and Latin America. In 2012, the company announced it would also start considering projects in Canada. As the initiative continues, some of the company's objectives have evolved. The success of the initiative will largely be determined by whether the company creates consumer engagement, particularly among Millennials. In doing so, Pepsi not only spreads awareness of its brand among younger generations but is also able to discover more about this customer base, including what issues are the most important to them. By integrating consumers into its promotional activities, Pepsi has been able to extend its reach and connect to consumers in entirely new ways.
Evaluate the public relations project along with why Pepsi decided to resume Super Bowl ads.