How Pepsi Increased Revenue After a Racially Insensitive Ad

On 6th April 2017, Pepsi publicly apologised to the world. They apologised to Kendall Jenner for putting her in the eyes of heavy scrutiny. Kendal Jenner cried on Keeping Up With The Kardashians - again. 

On 6th April 2017, Pepsi publicly apologised to the world. 

They apologised to Kendall Jenner for putting her in the eyes of heavy scrutiny. 

Kendal Jenner cried on Keeping Up With The Kardashians - again. 

There’s nothing worse than creating a ‘failed attempt to appropriate social justice movements in service of selling soft drinks’ ad. I mean there were sentences much worse, but this one encapsulated the fury of the Millennial audience, whole fully.

Pepsi has been labeled the more innovative and ‘trendy’ alternative to it’s competitor Coca Cola that generally sticks to its history and traditional stories in adverts.

Even after the Daughter of Martin Luther King Jnr tweeted about her disgust with PepsiCo, why did Todd Kaplan (VP of Marketing PepsiCo) celebrate Pepsico’s Brand Equity? Their organic sales grew by 2% in the July Quarter. That’s why.

What did they really do?

PepsiCo created an advert that was trying to portray inclusivity in a time where the Black Lives Matter movement was at it's 21st century peak - by hailing the drink 'Pepsi' the hero amidst a 'BlackLivesMatter' protest. You'd think a sensitive political issue and a soft drink don't go very nicely together.

Apparently PepsiCo and it's entire Marketing & Advertising department didn't realise.

But in saying this, people and brands make mistakes all the time. The ability to bounce back is what we can learn from here.

How they bounced back

PepsiCo understood the mistake.

But they jumped on board quickly to counteract this disaster through the hundreds of other campaigns they had around the world focusing on their existing loyal customers.

People understand that brands make mistake. But they also need to know that the brand cares about them too. 

Here's what they focused on to ensure they wouldn't face a huge decline in revenue:

  1. Hiring experts: Hiring a multiculturally aware agency to create their ‘multiculturally’ inclusive superbowl ad in 2018. 
  2. Brand reposition: New slogan changed from ‘Love for Now’ to ‘For the Love of It’.
  3. Consumer loyalty: Though they felt an incredible backlash online due to their ad, their organic purchases grew exponentially.

After all of that, Pepsico maintained its 2017 projection of 3% growth in "organic" sales. Even this catastrophic event did not hinder it’s brand loyalty with existing consumers.

What have we learnt?

Don’t underestimate the power of brand loyalty. Consumers that believe in your mission, your values and product won’t leave just because of one mistake. They understand that brands are not perfect. But be wary, without building strong connections and foundations with your consumers, there is a significant chance that your consumers will turn on you from one mishap.

Be real.

Care about your people.

Because people make brands. And brands are made for the people. 

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