Have you ever ordered a Coke at a restaurant, only to have the server ask, “Is Pepsi okay?” For some, this is no big deal—cola is cola. But for brand devotees, cola is not cola. With more than a century of rivalry between the iconic brands, it’s no surprise that consumers have developed strong preferences. In fact, the battle between the Coca-Cola Company and PepsiCo was so fierce that in the 1980s, the rivalry was dubbed “The Cola Wars,” a satirical nod to The Cold War.
Soda drinkers and marketers alike can agree that it’s intriguing to dissect what makes these two brands so competitive, and what businesses can learn from the ongoing battle. The Cola Wars not only shaped the beverage industry, it also offers a treasure trove of valuable lessons for marketers today. So, let’s take a closer look at Coca-Cola’s and PepsiCo’s respective approaches to branding and marketing to decide once and for all which one truly reigns supreme in The Cola Wars.
The Power of Branding: Different Cokes for Different Folks
In truth, Coke and Pepsi share more in common than their makers will admit. In addition to the obvious—they’re both dark-colored, sweetly flavored, carbonated soft drinks—they also share similar origin stories: both were created in the late 19th century by pharmacists as a tonic for common ailments such as indigestion. Even their product formulations are remarkably similar. What truly sets them apart, however, is their ability to leverage a very powerful tool: branding.
Coke has long been positioned as the “classic” choice, appealing to the traditional family unit. Its brand voice was crafted to be friendly, warm, and approachable, with ad campaigns centered on family values, nostalgia, and tradition. Think of the iconic images: Santa Claus joyfully holding a Coke, or the gathering of a happy family of polar bears. In fact, in the 1920s and ’30s, artist Norman Rockwell created several paintings for Coca-Cola, depicting everyday moments of simplicity, relaxation, and leisure, further cementing the brand as a symbol of America. The company has remained consistent over the years in maintaining this idealized image, reinforced today with modern slogans such as “Open Happiness.” Annual campaigns embracing the holiday season reflect that, after more than a century, tradition still runs deep and remains at the forefront of Coca-Cola’s branding strategy.
For Pepsi, on the other hand, the approach has been to create an edgy and rebellious brand identity. Targeting younger consumers, Pepsi is positioned as a youthful alternative to Coke. Fresh, exhilarating, and innovative, Pepsi’s messaging suggests that Pepsi is for the young and daring. The company maintained this image by closely associating with pop culture and leveraging celebrity endorsements. The very first celebrity ad for Pepsi aired in 1984 and featured the King of Pop, Michael Jackson. Jackson was seen dancing in the streets with a group of young fans and singing a Pepsi-themed rendition of “Billie Jean,” all while, of course, enjoying a can of Pepsi. The tagline: “The choice of a new generation.”
Coca-Cola and PepsiCo have both spent the past 130-plus years, and billions of dollars, shaping these distinct brands for their respective consumers And by many measures and metrics, the effort has paid off for both businesses. According to one recent study, Coke and Pepsi had 95% and 94% logo recognition, respectively, among survey participants. It was their strategic branding and innovative marketing moves that earned them such high brand recognition—one of the few things these two companies have in common when it comes to branding.
The Battle of the Brands: Iconic Ads That Defined the Competition
At the peak of The Cola Wars, Coca-Cola and PepsiCo constantly challenged each other with creative campaigns, and marketers from both brands were forced to think outside the box to emerge as the superior cola brand. The stiff competition resulted (in our humble but professional opinion) in some of the best marketing campaigns in history. Let’s take a quick look at a few of the most memorable campaigns that emerged from The Cola Wars.
Pepsi Says It Loud and Proud
Arguably, PepsiCo’s most famous campaign of all time is “The Pepsi Challenge.” The premise was simple: participants took a blind taste test of Coke and Pepsi and stated which one they liked better. The campaign revealed the consensus that more Americans chose Pepsi as the better tasting soda. This bold campaign faced its biggest competitor head-on while making claims that when it came to taste, Pepsi was the favorite. The campaign was such a sensation that it went galactic. In 1985, astronauts on the Challenger’s Spacelab 2 mission conducted their own Pepsi challenge, with Pepsi coming out on top. Following the campaign’s massive success, PepsiCo was able to top Coca-Cola in corporate sales for the first time in 1979.
Coke Makes It Personal
Who doesn’t remember rummaging through the fridge, hoping to find a Coke bottle with their name on it? That was all thanks to the “Share A Coke” campaign that launched in 2011 and turned drinking soda into a personalized treasure hunt. The results of this campaign were astounding. Transforming the act of buying a soda from a transaction to a personal interaction reinforced the heart of Coke’s brand: emotional connection. This campaign embraced not only emotional connection, but social connection as well. Coca-Cola harnessed the power of social media by using the hashtag #ShareACoke, which ignited a wildfire of online engagement. The “Share A Coke” campaign resulted in the production of 1.5 billion personalized bottles, and increased consumption in young adults—a key demographic for Pepsi—by 7%.
Not All That Gets Impressions Is Gold
There’s a lot to learn by looking at successful marketing campaigns, but it can be equally effective to learn from mistakes. With decades of marketing campaigns behind the soda brands, it’s inevitable that some along the way would fall flat. Take, for example, Coca-Cola’s response to The Pepsi Challenge. The company feared that PepsiCo might be right: consumers preferred Pepsi’s taste. PepsiCo was gaining more market share, and Coca-Cola found itself scrambling to win back the public’s favor. In 1985, Coca-Cola committed one of the biggest missteps in the history of the company: it changed its classic formula and introduced New Coke. To combat the slipping preference for Coke, New Coke was marketed as a new-and-improved formula that was sure to gain soda drinkers’ affection once again. The backlash was swift and overwhelming. According to Coca-Cola, its phone hotline saw a massive jump in calls from 400 to around 1,500 daily, the vast majority of which were complaints about New Coke. Classic Coke was back on the shelves in just a few months. The public’s reaction to Coca-Cola changing its classic flavor provides valuable insights into consumer psychology and brand loyalty. Perhaps it’s not always about the product itself, but the familiarity and connection consumers have with the brand.
PepsiCo has also had its fair share of marketing missteps, proving that no brand is immune to controversy. The brand’s commitment to aligning with rebellious youth has occasionally backfired. In 2017, PepsiCo featured celeb and supermodel Kendall Jenner offering a can of Pepsi to a police officer amid a protest. It was immediately perceived as tone-deaf and widely criticized for trivializing serious social movements. The commercial was pulled from the air after one day, but the damage had been done. The fallout drove Pepsi’s brand perception to a 10-year low. While it can sometimes pay off to take risks, in this case the gamble failed, highlighting the delicate balance it requires for brands to weigh in on sensitive issues.
The Winner of The Cola Wars Is…
Declaring the winner of The Cola Wars is far from straightforward. It’s a decision that ultimately comes down to personal preference. While Coca-Cola and PepsiCo remain giants of the beverage industry, the market is far from static. New soda brands are constantly emerging, all competing for a piece of the market share. At the same time, consumers’ preferences are shifting, with an increasing desire for healthier alternatives and more creative flavor compositions. As the landscape of the industry continues to change, it will be fascinating to see how these brands will use clever marketing and innovation to adapt. In the end, only time, and taste buds, will reveal which one truly comes out on top.
Competition aside, both brands have proven that understanding your audience and staying true to your brand identity is essential for success in an increasingly competitive market. Beyond the rivalry lie many marketing lessons to be learned as well as a reminder that branding requires clarity, consistency, and at times, bold risk-taking. Yet, it’s a delicate balance, and brands must be careful of straying too far from their core values or misreading public sentiment. In the end, truly great branding is an art form—one that requires a delicate balance of precision and intuition.
