Mar 1, 2006 12:00 PM, BY ROD TAYLOR

Pop Go the Points

Occasionally marketers hit on an idea that makes so much sense that even consumers wonder, “Why didn't anyone ever think of this before?” This was certainly true in the case of Pepsi Stuff, the first frequent-buyer program in soft-drink marketing.

The brilliant thing about Pepsi Stuff was that it effectively bridged the chasm between home-purchase soft drinks and QSR product. No matter where you purchased your soda, you were going to get points. The campaign turned a generation of folks into Dumpster divers in their search for more Pepsi Points.

For decades, Pepsi was the noble opposition to the much larger Coca-Cola. Created a dozen years after Coca-Cola, in 1898, by pharmacist Caleb Bradham of New Bern, NC, Pepsi has traditionally been the No. 2 brand that had to try harder. In 1934, for example, Pepsi introduced the 12-ounce bottle, selling it for the same nickel price as the six ounces that Coke was marketing. The “twice as much for a nickel too,” ad campaign that ran from 1939 to 1950 established Pepsi as the cola competitor that wasn't going to go away. Other innovations, like the introduction of the 16-ounce bottle in 1963, fizzed up the cola wars between Pepsi and Coke. The development of Diet Pepsi in 1964 came a full 20 years before Coca-Cola would take the risk of introducing Diet Coke.

The battles between these two companies became so intense during the 1980s that it turned their presidents, Roberto Goizuetta of Coca-Cola, and Roger Enrico of Pepsi, into celebrities. Enrico — no shrinking violet — even publicly declared Pepsi the winner of the cola wars in his best-selling 1986 book, The Other Guy Blinked: How Pepsi-Cola Won the Cola Wars. History, as they say, is written by the victors.

Going into 1996, Pepsi was staring down the barrel of that summer's Atlanta Centennial Olympic Games. Pepsi marketers reasoned that Atlanta-based Coke, an Olympic sponsor, would throw everything it had at games held in its hometown. Pepsi had to come up with something extraordinary to be competitive.

“Pepsi used Pepsi Stuff partly as a strategic response to Coke's Olympic extravaganza,” recalls Beverage Digest Editor John Sicher. “It was a smart and successful response.”

Pepsi's slogan summed it up: “Drink Pepsi, Get Stuff.” The seven-month promotion was designed to turn loyal drinkers into fanatics and bi-cola consumers into diehard Pepsi drinkers. It succeeded beyond the marketers' hopes.

“At our annual convention that year, virtually everyone was wearing the same thing,” says Bob Stoddard, president of the Pepsi-Cola Collector's Club. “We'd all redeemed our points for Pepsi Stuff, with many of our collectors trying to get one of everything offered. Six hundred people were wearing matching clothes.”

The promotion was enormous: Pepsi distributed more than 170 million of its 5-1/4" square, 24-page catalogs in-store, as well as in-pack — well over one for every other U.S. household. Over 4.5 million items worth more than $125 million were awarded to consumers mailing in their Pepsi Points. And 4 billion packaging units delivered 7 billion potential Pepsi Points to consumers.

“Pepsi Stuff is telling the world that in addition to delivering the best-tasting cola around, Pepsi also delivers a tangible value to consumers,” said Brian Swette, Pepsi's executive VP-marketing, during the program.

A guide in the back of each catalog detailed how many points a fan got from each purchase. Fountain drinks were worth one point and had a symbol you would remove from the cup. Bulk packs holding 20, 24 or 30 cans were worth 10 points.

Redemption was a joy. Unlike some continuity plans, Pepsi's program had an extremely broad selection of 24 different categories and 55 different SKUs. Merchandise ranged from low-end “kick sacks” (25 points) to Fila mountain bikes with bike bags (2,750 points). Pepsi T-shirts went for 80 points. A consumer could fill in any points he lacked by purchasing them for 10 cents each (T-shirts were thus valued at about $8.

The success of Pepsi Stuff helped reverse a long slide in cola's share of beverage sales. (Pepsi marketed Mountain Dew and Slice brands separately.) Before 1996, cola's share of carbonated soft drink sales had declined for nine of the prior 11 years and had slid five years in a row. In 1996, cola shares increased .2% from 58.1% to 59.3%.

The promotion won a Reggie Award for the year, and successfully blunted Coke's summer Olympic marketing efforts. Pepsi re-launched the promotion in 1997, with some refinements: it felt it had been too generous with the points required for merchandise in 1996. In year two, a simple Pepsi skateboard went for an astronomical 1,600 points, the equivalent of six 55-gallon drums of pop! Pepsi Stuff also surfaced in 2000 and 2003, but none of the subsequent programs matched the consumer reaction to the original.

Rod Taylor is senior VP-sales promotion for CoActive Marketing in Cincinnatti, OH. He can be reached at

EDITOR'S NOTE: A photo in the February Backward Glance was incorrectly captioned. The bronze statuette on p. 66 portrayed an elk, not a bison. PETA representatives may now stand down.


Pepsi Stuff debuted in 1996 with a TV spot that depicted a teen getting dressed. As he put on his Pepsi T-shirt, leather jacket and sunglasses, an overlay indicated the Pepsi Points for each. He then lands next to the school's bike rack in a Harrier Jet, generating a maelstrom. As the kid gloats, “Sure beats the bus,” an overlay read, “Harrier Jet: 7,000,000 points.”

The Harrier, a VSTOL craft (Vertical Short Take Off and Landing), is one cool airplane. So cool, in fact, that it spawned the greatest publicity of the whole campaign. After all, 21-year old John Leonard knew a phenomenal deal when he saw one.

Harriers lifted off the assembly line for $32.8 million each. Pepsi's ad offered one for the equivalent of 16.8 million cans of Pepsi — unattainable, right? Leonard, however, read the fine print: consumers could buy additional Pepsi Points for 10 cents each. He and a syndicate of five investors sent Pepsi's fulfillment agency, Young America, 15 original Pepsi Points, plus a check for $700,008.50 to equal the remaining points, plus, of course, an $8.50 shipping and handling fee.

Receiving no satisfaction from Pepsi and Young America on the mail-in, Leonard sued, claiming, “breach of contract, fraud, deceptive and unfair trade practices and misleading advertising.” On the plus side, the subpoena did spell Pepsi right.

The case was resolved in August 1999 by U.S. District Judge Kimba Wood, who stated that “no objective person could reasonably have concluded that the commercial actually offered consumers a Harrier Jet.”

“[Must we] put disclaimers on spots that are obviously farces? Where does it end?” asked Pepsi spokesman Jon Harris.

Where it did — in court.

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