How the popular Pepsi drink sparked street protests in the Philippines

2024 Author: Richard Flannagan | [email protected]. Last modified: 2023-12-15 23:55

At the end of May 1992, the Philippines was restless - unrest began in the country, leading to tragic consequences. The reason for this was not at all political disputes, not the economic crisis, not the strikes of trade unions and not the dissatisfaction with law enforcement agencies. The blame was one small marketing mistake of PepsiCo - a mistake that turned out to be huge losses.

Numerical Fever

The Philippines had long since become the sphere of influence of PepsiCo's competitors, the Coca Cola Company. "Pepsi" generally appeared as a result of the desire of the pharmacist Caleb Bredem to create a drink similar to Coca-Cola. The attempt succeeded in 1898, and the company entered into a constant rivalry with its powerful competitor, attracting Hollywood stars to advertise, "playing" with the volume of bottles, coming up with new brands of refreshing soft drinks. PepsiCo entered the markets of the Middle East, Latin America, China and the USSR.

In the Philippines, the real recognition of the population had yet to be won. Three quarters of the local market was owned by the Coca Cola Company. Then the Pepsi manufacturers developed a marketing plan that was supposed to draw attention to their own stake. A few years earlier, in 1984, such a publicity stunt had already worked for the Latin American market. PepsiCo decided to repeat the success. In February, a contest called Number Fever, or Number Fever, was launched. Under the corks of Pepsi drinks there was a three-digit code and a sum of money that could be won with it if you were lucky.

Every night on a television program, the winning numbers were announced - starting at 100 pesos, which was about $ 4. Most of the population of the Philippines was then engaged in hard physical labor, the minimum prize amount of the action was approximately equal to the daily earnings. The maximum prize - one million pesos or $ 40,000 - was a real jackpot for those participating in the lottery. Such a large sum was the earnings of an ordinary Filipino in twenty-three years of honest work. The lucky number was to be announced at the end of the promotion.

The campaign was a success, Pepsi sales were growing every day. In the spring of 1992, the company owned almost a quarter of the market, after the four percent recorded in the winter. And Filipino evenings were now accompanied by bottles of cola with numbers under the cap and TV shows. Every day, except Saturday and Sunday, the winning numbers were announced on television with the amount that was due to the lucky ones. These numbers, which brought the winners prizes of different sizes, were predetermined, and their list was kept in a bank safe to avoid abuse. By the time the advertising campaign ended, more than 31 million people had already participated in it. On May 25, it was announced that a prize of one million pesos goes to the one who found the number 349 under the cover. The problem was that there were 800,000 such lucky ones in the Philippines.

Protests

Somewhere at the stage of preparation of the competition, as a result of someone's oversight, and perhaps deliberate sabotage, even if this was not confirmed, there was a failure in the distribution of numbers on the caps. The company conceived only one winner, only he should have seen the coveted figures.

There was no question of fulfilling its obligations to the owners of caps with number 349 - the company simply did not have such funds, because it was already about tens of billions of dollars. The PepsiCo management announced a mistake and a technical failure, but people who had already believed in their luck did not accept such an excuse. Riots broke out in Manila. The company's headquarters was besieged by buyers who felt cheated.

Neither corruption, nor poverty rates, nor power outages have been able to provoke protests on the scale of one failed marketing ploy by PepsiCo. Representatives of various strata of society and political associations, communists and the military, the poor and those who considered themselves the middle class, took to the streets. All were united by the "deception" of the cola producers.

Failure of a marketing campaign

The protests were not bloodless. Beginning as peaceful actions, as a result of the suppression of demonstrations by the police, they turned into street riots, up to the use of hand grenades by protesters. As a result, at least five people died, including several PepsiCo employees. About forty of the company's trucks were burned or wrecked, and the products now had to be transported accompanied by well-armed guards. PepsiCo withdrew most of the leadership from the Philippines, an emergency meeting between the head of the company Christopher Sinclair and the President of the Philippines Fidel Ramos took place in the capital.

As a gesture of goodwill, each owner of the ill-fated 349 cap was offered compensation in the amount of 500 pesos, or twenty dollars. Almost half a million people agreed to the "bird in hand". It cost the company nearly $ 9 million from an initial promotion budget of $ 2 million. From those who did not want to compromise, appeals to the courts were poured; thousands of civil and fraudulent claims have been filed. The court denied the applicants a prize for each cap numbered 349, but awarded them compensation in the amount of ten thousand pesos each. After appealing the decision in the court of second instance, the amount of compensation increased to 30 thousand pesos.

In 2006, the Supreme Court of the Philippines finally dropped all charges against PepsiCo. In the eyes of justice, the company's actions did not contain corpus delicti, and the mistake was not malicious. In total, the soft drink maker lost an estimated $ 20 million in the 1992 competition and significantly shaken its market position, and the 349 incident went down in business history as one of the worst and most costly marketing mistakes.

Then it was just right to remember the sixties - and 1968, which became the year of protests in different countries.