Brand Loyalty: Coke vs. Pepsi

The soft drink industry battle between Coke and Pepsi has been around for ages. Most consumers of soft drinks almost always take a side between the two behemoths of the industry. While Coke markets itself as a traditional, family-oriented drink, Pepsi targets younger consumers through its branding, slogans, and the people that they often choose to endorse their brand. In the soft drink industry, there seems to be a clear divide between Coke fans and Pepsi fans, but there it no clear reason why that is the case.

Brand loyalty often occurs when a consumer perceives a brand to have benefits that competitors do not. As a result, a consumer will pick the better perceived brand when they have the choice. In the case of Coke and Pepsi, most people have strong preferences for one of the two brands, so the two brands engage in combative advertising in an attempt to shift consumer preference. Some people argue that Pepsi is sweeter and prefer Coke while others prefer Pepsi for that very same reason.

In a 2004 study published in Neuron magazine, scientists tested whether consumers had a change in taste and preferences when they associated tasting a soda with a particular brand. Scientists concluded that there was “a dramatic effect of the Coke label on behavioral preference (EurekAlert, 2004)” while Pepsi did not influence preference. If a subject had been exposed to “anonymous” cues such as an image of a Coke, MRI scans revealed increased preference in areas of the brain that “are implicated in modifying behavior based on emotion and affect. (EurekAlert, 2004)”What this demonstrates is that taste is almost irrelevant and that perceptions and brand positioning are what truly impacts brand loyalty.

In 2008, Beverage Digest reported that the market share for Pepsi and Coke was 30.8 percent and 42.7 percent respectively within the United States. Pepsi began the Pepsi Challenge in 1975 that blind taste-tested customers, and resulted in an increase in sales for the company. While challenges such as these have continued overtime, many have retained their preferences for either Coke or Pepsi. The marketing schemes have effectively differentiated Coke and Pepsi despite few chemical or physical differences between the two soft drinks. This strong differentiation has created brand loyalty that might not ordinarily exist otherwise.

This blog post was written by Freddie Joyner, Ben Lee, and Tracy Liang