That Time Pepsi Accidentally Promised Hundreds of Thousands of People $40,000 Each

TL;DR

Pepsi ran a promotion in the Philippines that promised customers $40,000 each, resulting in a potential spend of $32 billion, causing outrage and riots when they refused to pay out.

Transcript

During the never ceasing rivalry between Coke and Pepsi, each company has made some spectacularly bad marketing decisions to try and one up each other- from Coke’s baffling decision to spend $100 million to fill cans of their soda with water that smelled like farts to Pepsi somehow accidentally promising customers who bought enough of their soda a ... Read More

Key Insights

• ❓ Coke and Pepsi have a history of competitive marketing decisions that sometimes go wrong.
• 🇵🇭 The Number Fever Campaign boosted Pepsi's sales and market share in the Philippines significantly.
• 🥺 Pepsi's mishandling of the promotion led to riots, boycotts, and negative publicity.
• 😀 Despite the controversy, Pepsi recovered its sales and faced minimal legal consequences.
• 🌱 It is crucial for companies to carefully plan promotions and ensure consistent execution to avoid damaging their brand reputation.
• 🥺 Promises made to customers must be honored, as reneging can lead to significant backlash.
• 😣 Public relations crises can have severe consequences, including violence and loss of life.

Questions & Answers

Q: What was the Number Fever Campaign and how did it work?

The Number Fever Campaign involved collecting bottle caps with printed numbers, and Pepsi would announce winning numbers daily. Customers holding those numbers would win prizes ranging from $4 to $40,000.

Q: What went wrong with the promotion?

The final grand prize number, 349, was mistakenly included on the list of forbidden numbers. Around 800,000 bottle caps were printed with this number, and people demanded their prizes when it was announced.

Q: How did Pepsi handle the situation?

Pepsi refused to pay out the prizes, causing outrage and riots. They offered a gesture of goodwill of $18 to those with the number 349, but it was met with lawsuits and further backlash.

Q: Did Pepsi face any legal consequences?

Pepsi had to face thousands of lawsuits, but a Philippines Supreme Court ruling in 2006 cleared them of any responsibility, and they didn't have to pay anything to the plaintiffs.

Summary & Key Takeaways

• Coke and Pepsi have a history of making bad marketing decisions to outdo each other.

• Pepsi's Number Fever Campaign in the Philippines saw sales spike by 40% and captured an additional 9% of the soda market.

• Pepsi refused to pay out the promised prizes, causing mass outrage, riots, and boycotts.