Pepsi Case Study: “Live For Now Moments” Commercial

Marcela Marrugo, Nalany Resek, Jessica Willis, Madison McDougal

 Table of Contents

Intro/Thesis Statement: 3

Heineken’s Ladder of Creativity: 4

Background 5

SWOT 9

Strengths 9

Situation Analysis 10

Core Problem/ Opportunity 11

Goals and Objectives 11

Big Idea 12

Key Publics 12

Calendar 20

Budget 21

Evaluation 22

Conclusion 23

References 25

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 Intro/Thesis Statement:

In April of 2017, Pepsi released a three-minute long commercial featuring celebrity

Kendall Jenner. The commercial displayed Jenner modeling in a photoshoot, while minority and

activist groups around her were protesting and promoting general messages of peace and love.

The commercial also showed stoic policemen containing the protesters, but everybody seemed to

be beaming and having a general good time together. Jenner then proceeded to leave her

modeling gig, change into normal clothes, wipe off her makeup, and join the protesters. In the

climatic moment, Jenner grabs a Pepsi can and hands one to a police officer. This was published

right around the time that the #BlackLivesMatter protests were occurring within the United

States, and police brutality was at an all-time high and prominent in the media.

The commercial was so controversial and negatively received because it trivialized the

#BlackLivesMatter movement and the police brutality that was affecting so many people at that

time. It portrayed the protest as a celebration, with people smiling and coming together, when

that in reality contrasted greatly what was happening within this great nation. While Pepsi’s

intention was to “p​roject a global message of unity, peace and understanding,”​ both Pepsi and

Jenner were blamed for trivializing such a serious matter and making light of the killing of black

people by the police force (New York Times).

This case study will discuss and analyze how Pepsi could have better communicated with

its publics and reach its intended goal of promoting unity, peace, and understanding. We will

also analyze Pepsi on the creativity ladder and walk through a big idea for our campaign. We

will introduce messages, strategies, and tactics for minorities, activist groups and Black

Americans in order for Pepsi to reach its desired goal and message.

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 Heineken’s Ladder of Creativity:

We believe that Pepsi’s “Live for Now Moments” campaign was ​confusing​ on

Heineken’s Ladder of Creativity. It was misleading to the public and Pepsi was not successful in

its attempt to communicate unity among political groups. Youthful protesters are shown laughing

and smiling while holding signs saying, “Join the conversation” in references to recent Black

Lives Matter movement (Victor, 2017). Protests have been held in behalf of controversies over

police killing African-Americans.

Pepsi took a hot topic issue and made it seem simple enough to be solved by a drinking a

can of Pepsi together. ​“We did not intend to make light of any serious issue. We are pulling the

content and halting any further rollout,” Pepsi issued in a statement (Victor, 2017). Pepsi had the

desire to erase the political line and bring people together. The company could have eliminated

confusion by instead encouraging education and participating in current political affairs. If Pepsi

were to follow the campaign as explained in the remaining portion of this paper, we believe that

it would achieve a ​contagious​ level on the Heineken’s Ladder. It will be contagious because of

the originality of the strategies and tactics, and because people will feel motivated to continue

acting even after the formal campaign has finished.

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 Background

External Environment

The external environment in which Pepsi launched the “Live for Now Moments”

commercial was ripe with political and social movement. “Black Lives Matter” was a movement

that was started in August of 2014 when a white neighborhood watch shot Trayvon Martin, a

black 17 year old in Florida. He was acquitted, and three black women reacted by posting the

hashtag #BlackLivesMatter on social media. The movement was born, and with each following

shooting of a black person by a white police officer, such as the shooting of Michael Brown (an

18-year-old male at Ferguson, Missouri), the movement grew. By 2016, #BlackLivesMatter was

an established organization, and regular protests were occurring in which policemen would exert

force on the protesters; this created a fierce and desperate need for newsjacking. Pepsi’s ad was a

deliberate attempt to jump on the political bandwagon without its holistic mission values and

brand in mind, causing Pepsi to lose trust from its consumers.

When the commercial aired, there were many conversations about police brutality and

Black Lives Matter protests. Activists were angry that the commercial ​“trivialized the urgency of

the issues and it diminished the seriousness and the gravity of why [activists] got into the street

in the first place.” The ad also tried to appeal to other minorities besides black people in the ad,

such as Hispanics, Asians, and Muslims, by making them a part of the protests. Pepsi took

advantage of an issue that was so prominent in the media and capitalized on it, but it did so in a

way that angered its consumers and caused their CSR score to dip. In addition,​ Pepsi was

attempting to reach minority students which are millennial aged and portray a message of unity

and peace. College-aged students are being taught critical thinking skills, and controversial

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topics appeal to them, such as the Black Lives Matter Protest. Pepsi tried to appeal even more to

college-age students by using Kendall Jenner, a prominent opinion leader, and other diverse

millennials in the video.

Client

PepsiCo brand was founded in

1898 upon the merger of Pepsi-Cola and

Frito-Lay. Since the merger in 1898

Pepsi-Co has grown to be a global entity

selling products in over 200 countries. In

2017, PepsiCo had a net revenue of

$ 63,525 billion. PepsiCo has a diverse

set of brands, including but not limited to: Gatorade, Pepsi, Quakers Oats, Frito-Lay, Cheetos,

Tropicana, and Doritos. As a global company, PepsiCo strives to provide trustworthy and quality

work environments in all of its markets, boosting economies where its products are sold. PepsiCo

has a long history of high ranking CSR scores, however, after the Jenner’s commercial aired

its CSR score dipped.

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Competition

The Pepsi brand has a strong name recognition and it only has one true competitor,

Coca-Cola. Brand loyalty dipped during the crisis and Coca-Cola was chosen as an alternative to

Pepsi. In addition, Coca-Cola was looked to as a good example of handling political issues as its

1971 ad “I’d Like to Teach the World to Sing in Perfect Harmony” resurfaced (Nicholson,

2017). The ad was created in response to the Vietnam War and promoted unity. Pepsi attempted

to do the same but was unsuccessful, which caused its CSR score to dip and damaged its

reputation. PepsiCo used an inhouse advertising team for the Jenner ad, it is possible that the use

of an inhouse team lead to the negative reactions the advertisement received due to a lack of

outside perspectives. This led to a social media hashtag #BoycottPepsi and directed consumers

towards purchasing Coca-Cola products.

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Market Research

In 2016, PepsiCo’s president, Brad Jakeman, spoke of simplifying its advertising efforts.

“Instead of taking six months to develop an ad, we have six hours or days. And instead of it

costing $2 million, it needs to cost $20 thousand” (Marketing Week). However, this reduced

timeline contributed to the “tone-deaf ad” featuring 21-year-old model Kendall Jenner as the

leader of a group of protestors, therefore trivializing the Black Lives Matter movement. This

activist movement was created in 2013, and its mission of “racial justice” is grossly

misrepresented in this campaign, which caused its CSR score to dip. Social activists and Black

Americans were not afraid to let the public know their stance of outrage through the use of social

media platforms such as Twitter, Facebook, and Instagram.

Pepsi’s in-house team worked too quickly on the campaign and the team “failed to

properly vet it for controversy” (Marketing Week). Pepsi’s brand value dropped by 4 percent by

the end of 2016, according to Brand Finance. This is a demonstration that market research must

be conducted prior to any major events or campaigns so that the intended publics feel

understood. The intended publics in this particular instance are Black Americans, social activists,

and minority students, and all three groups share a similar lifestyle in that they are classified as

believers, achievers, and self-fulfillers. This ad was a blatant contradiction from everything the

key publics believe which caused Pepsi to lose its reputation and trust of its consumers.

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 SWOT

Strengths Weaknesses

PepsiCo is known for having a colossal PepsiCo’s image and overall brand reputation

global reach, with the largest food & has been hit greatly, which lead to its

beverage business in the United States., consumers wanting to boycott Pepsi products

Russia, India and the Middle East. In 2017, it through the use of social media’s hashtag,

was valued at over $155 billion. It also has #BoycottPepsi. Pepsi’s brand value dropped

multiple high-profile sport sponsorship deals by 4 percent by the end of 2016, according to

with the NHL, NBA, NFL, and MLB. Brand Finance. Millennials, Black Americans

Because it has several entities (Lays, Quaker and activists pose a threat because they

Oats, Naked, etc.), its brand is easily support companies that stand behind

recognized. It is ranked 29 in the Forbes Most merit-based values, such as Coca-Cola, and

Valuable Brands list. PepsiCo’s CSR score dropped by 4 percent,

showing that its efforts failed in being

culturally aware through demonstrating unity,

peace, and understanding.

Opportunities Threats

Pepsi currently has the media’s attention A major threat to PepsiCo is the aggressive

which will allow it to easily share its new and competition from Coke. It currently has the

improved message, and listen to what the largest stronghold in the market share, and a

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 customers are saying. Rather than a ‘shoot vast global presence as well. The social

from the hip’ bandwagon stunt, Pepsi now ramifications that this incident could pose are

has the opportunity to review the extensive if consumers switch. Coca-Cola

organization’s values of unity, peace, and also released a very well-made “America the

understanding in a holistic manner. This is Beautiful” commercial, in which people of all

where its CSR efforts must improve since the races and religions sang the popular anthem.

brand image is hurting the organization. The ad promoted unity and peace, and

consumers can compare the two and

decide that Coca-Cola is the better

of the two organizations.

Situation Analysis

Pepsi is currently being attacked for cluelessness and insensitivity toward the

#BlackLivesMatter movement and the terrible timing in its Kendall Jenner advertisement. The

campaign attempted to promote unity, peace, and understanding but instead made light of the

serious issue regarding protests. Pepsi’s campaign was unsuccessful and discredited its

knowledge of current social issues which caused its CSR score to dip heavily. The challenge now

is for Pepsi to restore its reputation and regain the trust of its consumers, mainly the activist

groups, black people, and minority students, specifically ages 18-25. Pepsi’s error has led to an

opportunity of having the media’s attention, that will allow it to easily share its new and

improved message.

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 Potential difficulties that could impede success is the loss of trust and credibility of its

consumers. Minorities could feel that Pepsi is uneducated regarding political movements and

turn to alternative products that have a stronghold in the market, such as Coca-Cola. Competitive

markets could increase as they recieve Pepsi’s customers. In addition, consumers could stop

purchasing Pepsi in response. Many consumers actually began to boycott all Pepsi brands and

the hashtag #BoycottPepsi even started to trend on Twitter (Twitter). Brand loyalty is imperative

to the success of a company, and consumer withdrawal is an unfavorable, yet highly probable

possibility if there is no trust involved.

Core Problem/ Opportunity

If Pepsi does not take the necessary action to fix its public perception regarding political

correctness and unity, then Pepsi will lose market shares to its competitor Coca-Cola and its CSR

score will decrease.

Goals and Objectives

Goal:​ Improve public perception of Pepsi’s brand as a politically correct and inclusive brand that
listens to its consumers.

Objectives:
a) Increase Pepsi’s brand reputation by 10 percent by the end of the three-month campaign.

b) Restore PepsiCo's corporate social responsibility (CSR)/environment social governance

(ESG) ranking by 3 percent through giving back to the community by the end of the

campaign.

c) Objective: Engage at least 5,000 people who are vocal within their communities during

the next three months.

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 Big Idea

STRATEGY: ​Motivate individuals (especially minorities and activists) within the country to

make a change in their communities through messages and incentives that promote unity,

peace, and understanding.

MESSAGE:​ Although we are all different, at the end of the day we are part of the human race.

We can all promote change and create a better world, together. ​#PepsiIsForUs

VISUAL REPRESENTATION:​ Have applicants submit videos describing how they are

making a difference in their community and share the 50 winners’ videos on the Pepsi’s

website and social media platforms. Each winner will receive $5000 scholarship to the university

of their choice.

SLOGAN:​ ​#PepsiIsForUs

Key Publics

1. Black Americans

a) Demographics/Psychographics: African Americans are the second largest minority

population in the United States. The census from July 2015 reported that 40.7 million

people in the country were black alone, which is 12 percent of the total population.

Throughout the history of the United States, black people have been enslaved,

segregated, and treated unequally. Although there are no laws that permit the unequal

treatment of non-whites anymore, racism remains a prominent societal problem. Because

of this, black people have a strong sense of community and camaraderie.

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b) Objectives:

i) ​Increase Pepsi’s brand reputation by 10 percent by the end of the three-month

campaign.

ii) Engage at least 5,000 people who are vocal within their communities during the

next three months.

c) Third-party opinion leaders: Black Americans take much pride from local leaders who

are willing to act and are not afraid to promote change. ​Because of this, it is better to

reach them through urban locations.

d) Viable communication channels:​ Since black people have a strong sense of community

and pride in their culture, we will reach them through strong visual arts.

e) Relationship with organization or issue: Through the Jenner Commercial, Pepsi was

trying to reach minority demographics to show that it stands for equality of the races,

genders, etc. Black Americans are a potential consumer for Pepsi because it is a global

reaching company with active opportunities to help urban community members break

through the social barriers.

f) Motivating self-interests: Black Americans greatly value their association with

companies that have values centered towards improving the world and helping others see

things from their perspective.

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 Messages

● Primary: ​We all look different, think different, and act different, but we are part of the

same human family. Pepsi is committed to providing opportunities to those who have

been disadvantaged in the past.

● Secondary:​ ​PepsiCo has greatly valued diversity throughout the history of the company.

In 1962, PepsiCo hired the first ever African-American Vice President of the company

and of any major corporation in the United States. In 1940, it hired its first black

salesman, long before the civil rights movement (PepsiCo).

● Secondary: In the past, Pepsi has focused heavily on marketing its soft drink toward

black markets, while other big companies like Coca-Cola ignored these markets

completely. Pepsi sees you, and hears you, we always have and always will.

Strategies and Tactics

Strategy:​ Highlight the lives of influential opinion leaders who have made a positive impact on

black lives through the use of visuals and art.

​Tactic:​ Hire local artists in ten cities

around the country to paint murals that

reflect unity and the strength of a

diverse community.

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 Tactic:​ ​Print pictures and quotes of historical minority figures on Pepsi

soda cans who have changed the world through their small, yet

far-reaching efforts. Examples can include Nelson Mandela, Ghandi,

Mother Theresa, Martin Luther King Jr., Rosa Parks, etc. This tactic will

connect and motivate minorities self-interests towards improving the

world around them.

2. Social Activists

d) Demographics/Psychographics: An activist is someone who works toward or fights for

change, and social activism is the act of bringing about social change. This is exactly

what was happening around the time Pepsi released its “Live For Now Moments”

commercial featuring Jenner. The type of social activists Pepsi is trying to reach includes

any man, woman, or child who is actively fighting for change, through protesting,

social media, clubs, or other organizations. This group is comprised primarily of

millenials and Gen Z.

e) Objective: Engage at least 5,000 people who are vocal within their communities during

the next three months.

f) Third party opinion leaders: Leaders of various activist groups that promote different

rights throughout the United States.

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g) Viable communication channels: Press releases and information published on Pepsi’s

personal website are main communication channels for this public because they are

actively seeking new information.

h) Relationship with organization: Historically, social activists have been shot down and

oppressed, paralleling the #BlackLivesMatter movement. They also feel that big

organizations are not on their side and are not doing their part in promoting social

change. In the Jenner commercial, Pepsi wanted to show these activist groups that it cares

and supports unity, peace, and understanding. This angered many activist groups causing

them to speak out against the company. These activist groups are consumers, opinion

leaders, and influencers for Pepsi.

i) Motivating self-interests: Social activists care deeply and fight for social change. Some

issues that are important to the activists that Pepsi is intending to reach include police

brutality and equality for all races, genders, and sexual orientations.

Messages

● Primary: Miscommunication can happen to those who choose not to listen, but we do

hear you. Pepsi is dedicated to promoting social change and is doing its part to make a

difference in the world. Let’s make that difference together.

● Secondary: “PepsiCo has been named one of the World's Most Ethical Companies by

Ethisphere® Institute for 11 consecutive years and was included in Fortune Magazine's

Change the World​ 2016 list, 50 companies that do well by doing good” (PepsiCo

website).

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 ● Secondary: “We conducted audits on labor rights at 77 PepsiCo sites, which led to

completed action plans in 2016” (PepsiCo Sustainability Report).

Strategies and Tactics

Strategy:​ Motivate activists through the use of events to support Pepsi by persuading

them that Pepsi values peace, unity, and understanding. Show that Pepsi believes that we are all

one.

Tactic:​ ​Hold a press conference in which top executives will issue a formal apology for

the ignorance communicated by the Jenner commercial and answer questions as to how Pepsi

will work towards becoming more educated and aware of the needs in their communities.

Tactic:​ ​Host charity events in three cities across the country where people can come

together to learn about important causes and make donations. Pepsi will provide food and

beverages at events by hiring local food trucks to come to the outdoor event.

3. Minority Students

a) Demographics/Psychographics: As of 2015, there were about 12 million college students

between the ages of 18-25 in the United States and 8.1 million students over the age of

25. Of these students, 55 percent were white, 13 percent black, 16 percent hispanic, 6

percent asian, and 9 percent “other,” making that a total of 45 percent nonwhite students.

With the Kendall Jenner commercial, Pepsi was attempting to reach millenials and

portray a message of unity and peace. It tried to appeal to college-aged students by using

Kendall Jenner, a prominent opinion leader, and other diverse millennials in the video.

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 By having minority students as a key public, we will be able to appeal to many of the

same consumers who were angered by the commercial and at the same time improve

CSR efforts through educational efforts.

b) Objective: ​Restore PepsiCo’s corporate social responsibility (CSR)/environment social

governance (ESG) ranking by 3 percent through giving back to the community by the end

of the campaign.

c) Third-party opinion leaders: Minority opinion leaders who have made an impact and

spoken out about education such as Malala Yousafzai, Will Smith, and Oprah Winfrey.

d) Viable communication channels: Social and popular media platforms such as YouTube,

Instagram, Spotify, and Twitter are the most prevalent channels in which they engage.

e) Relationship with the organization: Minority students are often first-generation college

attendees, are more likely to need financial assistance and less likely to graduate than

their white peers. They are potential consumers for Pepsi and would be supporters of the

brand if they viewed it as a brand that actively cared for and tried to help minority

students succeed.

Messages

● Primary: As we as a people become more educated, we will be better prepared to

collaborate and work together to solve world problems.

● Secondary: Pepsi and PepsiCo already have over nine existing scholarship programs

helping students improve their education.

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 ● Secondary: “​PepsiCo has a strong legacy of leading in diversity practices starting in the

1940s by breaking the color barrier and hiring African American salespeople, in the 50s

as the first major company to have a woman on its Board, to the 80s where we pioneered

multicultural marketing” (Diversity and Engagement).

● “Scholarships, mentoring and healthy food have reached >200,000 students and their

families in Egypt alone, with increased enrollment rates in >100 Egyptian schools”

(PepsiCo Sustainability Report).

Strategies and Tactics

Strategy:​ Motivate and inspire minorities to pursue education and create change in their

communities through the use of social media campaigns.

​Tactic:​ Promote a scholarship program through social media by having individuals

submit a video of how they make the world a better place in their community. From the videos

submitted, one college student from each of the 50 states in America will be awarded a

scholarship of $5,000.

Tactic:​ Social Media campaign (Instagram, FB, Twitter): post a picture sharing a Pepsi

can with a friend and use the hashtag #PepsiisForus. PepsiCo will donate $5 to inner city

educational efforts per post. Share a Pepsi with a friend, help to educate the future. We will

donate a maximum of $1 million.

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Calendar

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21
Budget

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 Evaluation

Objective 1: ​Increase Pepsi’s brand reputation by 10 percent by the end of the three-month

campaign.

Criterion:​ At the beginning of the campaign, 54 percent of people viewed Pepsi as being

a positive company and could recognize its products. By the end of three months, the follow-up

survey showed that 72 percent of the people viewed Pepsi’s brand as positive and could

successfully recognize their products.

Tool:​ An independent research company was hired to conduct both qualitative and

quantitative research. Through the use of focus groups and surveys administered, the research

company established both the correlation of the views held by minority students, blacks, and

social activists of Pepsi as well as gained insight into why they hold these views.

Objective 2: ​Restore PepsiCo's corporate social responsibility/environment social governance

ranking by 3 percent through giving back to the community by the end of the campaign.

Criterion:​ Prior to the release of Pepsi’s Jenner video it had one of the highest CSR scores

based off of independent outside sources such as forbes and CSRhub, scoring 96 out of 100.

After the Jenner commercial was released, this score dropped several percentage points on most

outside CSR scoring websites. At the end of the campaign the CSR score reached 96, returning

to the previous score for an improvement of four percentage points.

Tool:​ Pepsi used an outside research company to conduct its own research to compile a

new CSR score which was compared to the scores generated by outside sources at the beginning

of the campaign. It was important that an independent source is used to prevent bias in the

responses.

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Objective 3:​ Engage at least 5,000 people who are vocal within their communities during the

next three months.

Criterion:​ There were 125 people in attendance to the press conference and a total of

6,637 people in attendance at the three charity events. Between the press conference and charity

events we had a total of 6,762 people in attendance, exceeding our goal of 5,000 people.

Tool:​ Take a complete tally of people who attended the press conference and the three

charity events. There will be an assigned person at each event to count all those in attendance.

Conclusion

Pepsi had good intentions with its commercial to promote unity, peace, and

understanding, which it failed to do. In reality, this organization communicated ignorance and a

lack of respect for a serious social issue, and angered many of its consumers and key publics. In

our opinion, Pepsi did not realize the impact and repercussions that the commercial would have:

it had the right idea, but the wrong execution. With our campaign, we want to align Pepsi’s self

interests with that of the consumers and key publics, and show them that Pepsi truly cares and

works for unity, peace, and understanding. The #PepsiIsForUs campaign not only communicates

the correct messages, but also contains strategies that will motivate consumers to act and show

them how Pepsi promotes social change. Pepsi’s goal to promote unity, peace, and understanding

will be achieved by communicating specific messages to minorities and activist groups through

various resources such as social media platforms and press releases while employing various

strategies and tactics. These actions will increase sales for Pepsi, and improve its corporate social

responsibility. It will also repair some of the damage done by the “Live for Now Moments”

commercial and restore Pepsi’s reputation among consumers.

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 References

Background:

https://www.nytimes.com/2017/04/05/business/kendall-jenner-Pepsi-ad.html

https://www.forbes.com/companies/Pepsi/#4dd29115bc3

http://www.Pepsico.com/sustainability/Performance-with-Purpose/Our-Goals

http://www.Pepsico.com/docs/album/sustainability-reporting/pep_csr16_091317.pdf

https://twitter.com/hashtag/boycottpepsi?lang=en

https://www.nbcnews.com/news/nbcblk/analysis-trayvon-martin-s-death-still-fuels-movement-fi

ve-years-n725646

https://www.huffingtonpost.com/entry/history-black-lives-matter_us_56d0a3b0e4b0871f60eb4af

Background- Client

http://www.pepsico.com/About/Our-History

https://www.britannica.com/topic/PepsiCo-Inc

https://www.pepsico.com/docs/album/investor/pepsico-inc-2017-annual-report.pdf

https://adage.com/article/agency-news/pepsi-gaffe-puts-target-house-agencies-fair/308604/

Background- Market Research

https://www.marketingweek.com/2017/10/26/market-research-innovations/

http://snapshot.numerator.com/brand/pepsi

SWOT

https://www.thestreet.com/story/14074263/1/kendall-jenner-pepsi-commercial-made-me-look-at-

the-stock-i-was-surprised.html

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Various references

https://blog.campus.app/student-demographics-in-higher-education

http://www.pepsico.com/About/Diversity-and-Engagement

https://www.theguardian.com/business/2017/apr/05/from-cokes-flower-power-to-kendall-jenners

-pepsi-ad-how-ads-co-opt-protest

http://www.pepsico.com/live/story/black-history-month-honoring-six-african-american-leaders-

who-broke-barriers

http://www.collegescholarships.org/scholarships/companies/pepsi.htm

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Final Written Case (150 + 25 Presentation pts.)

The written plan presented must include the basic elements of:

1) Intro to Campaign Strategy w/ thesis or topic sentence 10 pts

2) Campaign Strategy

a. Background. 10 pts

b. SWOT. 15 pts.

c. Situation analysis and core problem. 15 pts.

d. The program’s goals and objectives. 10 pts.

e. The big idea. 15 pts.

f. Key publics. 15 pts.

g. Message design. 15 pts.

h. Strategies and tactics. 15 pts.

i. Calendar and budget. 10 pts.

j. Evaluation. 10 pts.

3) Creativity and analytical thinking. 10 pts.

4) AND, number the pages!!!

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