Cola Wars

Tonight, our program

is about the war between Coke and Pepsi.

I'm a Pepsi person. Always have been.

I hate it. It tastes like watered-down Coca-Cola.

Coca-Cola. Like I said, it really is the best.

male narrator: For over 100 years,

Pepsi and Coke have been locked in a battle

for the hearts, minds and wallets of America.

Coca-Cola is the most popular consumer product in the world.

Pepsi was always scrapping to beat number one.

You tell me which one you picked.

Okay. Pepsi.

The Pepsi Challenge was like a bomb going off in Atlanta.

It was a shocking occurrence in the soft drink wars

and in Coca-Cola.

narrator: Employing brilliant minds

and millions of dollars,

Pepsi and Coke used every weapon possible

to destroy their competition.

Ladies and gentlemen, Michael Jackson.

Michael leaned over and said,

"I'm going to make Coke wish that they were Pepsi."

And I remember thinking to myself,

"This is going to change everything."

They went into crisis mode.

What do we do?

Coca-Cola is about to announce

what it calls the most significant development.

We were pretty much in disbelief.

The most significant

soft drink marketing development

in the company's 100-year history.

We have to figure out what this is.

narrator: How did a war between

two soda brands succeed in capturing the imagination

of the entire country

and almost destroy one of the most iconic symbols

of American culture?

Yes, for a bright taste and a bracing sparkle,

for perfect refreshment every time,

there's nothing like ice-cold Coca-Cola.

narrator: Coca-Cola was the first cola

introduced to America, created in 1886

by a pharmacist in Atlanta, Georgia.

Pepsi-Cola came soon after, in 1893,

and spent most of the 20th century

trying to catch up to Coke's early head start.

By the 1970s,

Coke was the undisputed leader

amongst all colas across the globe.

male announcer: Coca-Cola is sold

in 137 countries as the world's

most popular soft drink.

Walk down the street of any town,

any city, any burg,

and you would see Coca-Cola signs.

It got to the point where people didn't even notice

Coca-Cola signs anymore

because it was such a part of the landscape,

just like you don't notice every tree that you see.

I believe the story goes that the two most recognizable words

in the English language are "okay" and "Coke."

- Do you speak any English? - No.

- How about a Coke? - A Coke?

Coke. Drink. Coke.

Coca-Cola!

narrator: In a business where even

a one-point edge in the market

was worth hundreds of millions of dollars,

Pepsi and Coke fiercely competed

for every ounce of soda consumed across the world.

Pepsi's task was, in fact, to be the underdog.

To be the rascally rabbit,

or "wascally wabbit," if you will,

to the Elmer Fudd of Coca-Cola.

I think being the underdog is the place you want to be,

because when you're number one, you're in the lead,

you kind of sit on your laurels and you don't really...

"Well, we're great, we're wonderful,

there's nothing else that we could possibly do."

But number two is always scrapping to beat number one.

narrator: In the 1970s,

the competition was fierce.

RC Cola, Dr Pepper and others were vying to be number two.

Pepsi knew that to even get

on the same playing field as Coke,

they would need to make a bold move.

And then, all of a sudden,

this sort of very local, little advertising gimmick

a local Pepsi guy came up with, called the Pepsi Challenge.

And the world changed.

male announcer: In recent side-by-side

blind taste tests, nationwide, more than half

the Coca-Cola drinkers tested preferred Pepsi.

Which do you like better?

I prefer this one.

It has a more tangy taste.

Tell me the one you preferred.

Pepsi-Cola.

You can believe that.

In Dallas, Texas,

we introduced a comparative advertising campaign,

unique at the time,

where we were a number-three brand.

Not just a number-two brand. A number-three brand.

Coke, Dr Pepper, the local brand, and Pepsi.

So with almost nothing to lose,

we launched a blind taste test.

male announcer: This is the taste.

This is the test.

Pepsi versus Coke. The Pepsi Challenge.

I mean, production values were low when I was a kid,

but this was startlingly low.

Like, come here, we've got mystery beverages.

Would you be willing to sit down and try them?

No! Coke would never do that.

narrator: Coke was winning

in the supermarkets and the fast-food chains.

Pepsi's strategy: win the supermarkets,

and the rest of America will follow.

The Pepsi Challenge proved Pepsi was on the offense

and unafraid to take on the champ.

You tell me which one you picked.

Okay. Pepsi.

What do you think of the Pepsi Challenge now as a test?

- I believe it. I believe it. - You believe it?

At first I thought, well, it's not real, it can't be real.

And I actually... we did it at our house with friends,

and more people ended up picking Pepsi.

I was like, well, maybe this is actually something real.

It's not just a gimmick.

Where I grew up in Cincinnati, Ohio,

we loved the Reds.

We loved the Bengals, and we drank Pepsi.

That's just the way it was.

When I saw the Pepsi Challenge

and I saw people choosing Pepsi,

it just affirmed everything about who I was.

I was like,

"They're making the right choice."

Pepsi.

Do you want to do a Pepsi Challenge?

Make a fool of myself, sure.

So the question before us is,

can the author of "The Cola Wars"

tell the difference between Coke and Pepsi?

I doubt it very much, but I'll give it a shot.

It's... listening to these guys talk about beverages,

you'd think they were talking about the finest wines.

On a sip test basis,

Pepsi is a sweeter product than Coke.

It has ten more calories in a can than Coca-Cola does.

I don't know what I'm doing.

And on a sip basis,

Americans will tend to pick the sweeter product.

Pepsi took this and used it to their advantage.

Can I guess this is Pepsi?

Reveal.

You got it.

Oh, my God, I can't believe it.

Well, it was one out of two, you know?

male announcer: All across this country,

people took the Pepsi Challenge,

and Pepsi won, because...

It really caught public attention,

and Pepsi Challenge was the catapult

to a rivalry that put Pepsi on,

really, the same playing field as Coke.

Pepsi-Cola.

Even thought it was one a one- or two-point advantage,

it put them on camera next to Coca-Cola.

And suddenly they moved from a second positioning

to an equal positioning in the minds of the consumer.

That's really what the Pepsi Challenge was all about.

narrator: By the end of the 1970s,

the soft drink business was growing fast.

Fuelled by the intensifying cola wars,

Pepsi was gaining real momentum for the first time in history.

With so much money and market share at stake,

Coke wasn't going down without an epic fight.

I'm from Atlanta. I was born in Atlanta.

I obviously grew up drinking Coca-Cola.

I don't think I've ever known a Pepsi drinker.

Now that I think about it.

This one.

Coke.

I was pretty sure it was Coke.

I passed my Atlanta test.

My mother's not spinning in her grave.

You're a Coca-Cola drinker, is that right?

Yeah.

I'm gonna ask you to take sip.

The Pepsi Challenge was like

a bomb going off in Atlanta.

First of all, it was rude, you know?

Again, that's just not the way you did business.

You didn't call attention to the other person's product,

and you certainly wouldn't claim you were better.

Coca-Cola was outraged.

They said, "This is unfair advertising."