PepsiCo is well known for throwing out heavy advertising dollars.
Despite it being a tradition rooted all the way back to the start of its intense rivalry with Coca Cola, CEO Indra K. Nooyi has concluded that anymore money spent on advertising will be considered a blatant waste.
According to The Onion, a series of meetings was held over the past months before this mind blowing decision (at least for us) was made.
PepsiCo released a statement to its shareholders declaring that PepsiCo is now “what it should have been all along: a company that just makes soda, and doesn’t get caught up in trying to make everyone like it.”
Highlights of CEO Inda K. Nooyi’s press release below.
“We know it’s good, and everyone’s pretty happy with the overall taste, so why spend all our time worrying about what other people think?” PepsiCo CEO Indra K. Nooyi told reporters during a press conference at the company’s corporate headquarters. “Frankly, it just feels sort of weird and desperate to put all this energy into telling people what to drink. If they don’t like it, then they don’t like it. That’s not really any of our business anyway.”…
…”You can’t taste an ad, anyway,” Nooyi said. “People are going to make up their own minds regardless of whether we spend millions trying to inform them that Taylor Swift drinks Pepsi. I mean, seriously, does it really matter if Taylor Swift drinks Pepsi? She’s just a human being like everybody else.”
Will Pepsi Sales Drop?
Well, that’s the question isn’t it? With the absence of ads, will Pepsi be remembered ten years later, especially in the younger generations?
Also, not caring what consumers think of your drink seems to be a pretty bad explanation for ceasing the ads. Either CEO Indra K. Nooyi has greater plans or she doesn’t have any idea what consumer behavior is all about. If you, the company that is earning my money doesn’t care about what I think, then why would I care enough to think about your brand?
Remember when we said consumers do not know what they want exactly? It is definitely the business of any company to tell consumers why they should choose your brand or product. If you have the “if you like it, you like it and if you don’t, too bad” mentality, chances are along the way, consumers would find something else they like better.
I can’t help but scoff at her “You can’t taste an ad” comment. Let’s leave being rational and assuming your consumers are to the economists. As marketers, we all understand how rational consumers really are. The mechanism behind perceptions and decision making is illogical but at the same time, perfectly sensible.
We’re not sure how long Pepsi is going to last with an empty advertising budget but sales is bound to drop sooner or later.
PepsiCo might be cutting cost and…
…this might just be a PR gimmick. The strategy is simple. Since PepsiCo decided to cease its advertising for now, why not create a buzz before doing so.
Could that be the real reason?
Edited
For all of you who are confused by this post quoted from The Onion, yes the story is fake because well, it’s from The Onion. Really appreciate the quick response. Now that we’ve caught your attention, we are leaving ourselves open to some serious discussion.
Is HEAVY advertising a waste of money for big companies that have already established themselves? Does Taylor Swift help sell more sodas? Let us know what you think!
