Will Pepsi test leave bad taste?

So, your $500m (350m) global repackaging initiative is failing and the senior management figure associated with it has already committed the corporate equivalent of seppuku. What do you do next? Incredible as it may seem, you gamble with the brand’s best single asset – its demonstrably superior taste – by tampering with it.

Looked at coolly, that is exactly what Pepsi is doing with its standard cola brand. Of course, from an internal perspective the decision does not seem nearly so momentous. The country in which this ‘new taste’ Pepsi is being launched is France. There, the standard brand has been in need of serious refreshment for some time and has yet to receive a glitzy overspray of Project Blue. Logically enough, the French marketing team has concluded, from lacklustre results elsewhere, that the relaunch of Pepsi needs a bit more substance than some fancy repackaging and a ‘new script’. And that’s exactly what they are promising, with the words ‘nouveau got’ emblazoned all over the tin and some spanking new livery which goes well beyond the muted original of Project Blue.

If the experiment is a failure, presumably it will be written off as a French aberration. On the other hand, if it succeeds the implications for Pepsi are enormous – and potentially embarrassing. Once you begin to tailor the sacrosanct flavour of Pepsi in one country, why not in others? What happens to the brand’s global homogeneity? What a field day for Coke.

That, presumably, is why US Pepsi executives are so nervous of the French experiment. To the extent that they are playing down the flavour change as a mere ‘enhancement’ (in truth, it seems to be a concentration of the existing formula) and roundly condemning any suggestion that Pepsi la Française could ever be rolled out internationally. Unfortunately, this latter assertion is compromised by the revelation that the new French flavour has been tested in two US cities. Certainly, impartial industry observers cannot believe that a global corporation like Pepsi would be able or willing to confine commercial success, however problematic, to a single market.

To outward appearances, Pepsi beverages is a company mired in considerable difficulties – and therefore prepared to entertain increasingly risky stratagems. Certainly its recent financial results reveal little cause for optimism so far as Project Blue is concerned. But that is not the whole story. In the UK, for example, Pepsi is enjoying its best performance for years, showing the relaunch has not been an unmitigated disaster.

Cover Story, page 26

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