Branding Pepsi: What 70 Years of Positioning Pivots Teach Us

Branding Pepsi is one of the longest-running case studies in commercial marketing, and not always for the right reasons. Over seven decades, Pepsi has repositioned itself more times than most brands change their agency roster, cycling between challenger energy, cultural provocation, and mainstream aspiration with varying degrees of success.

What makes Pepsi genuinely useful to study is not the wins. It is the pattern: a brand that has consistently known what it is against, and struggled to define what it is for. That tension has produced some of the most memorable campaigns in advertising history, and some of the most expensive brand missteps on record.

If you work in brand strategy, Pepsi is not a cautionary tale. It is a live brief that keeps refreshing itself.

What Has Pepsi’s Brand Actually Stood For?

This is the question that makes Pepsi interesting and, at times, commercially frustrating. Coca-Cola has spent a century owning happiness, togetherness, and the idea that its product belongs at the centre of human moments. It is a simple, durable position. Pepsi has rarely had that clarity.

At its most coherent, Pepsi has stood for youth, energy, and the idea that choosing Pepsi is a statement about who you are rather than what you are drinking. The “Pepsi Generation” campaign in the 1960s was the clearest articulation of this. It was not about the liquid. It was about the consumer’s self-image. That is a legitimate and commercially powerful positioning strategy, provided you can sustain it across every brand touchpoint over time.

The problem is that “youth and energy” is a position that requires constant renewal. The cohort you are speaking to changes every decade. The cultural references that felt fresh in 1985 feel dated by 1995. And if your brand becomes synonymous with a specific era of youth rather than the idea of youth itself, you have a nostalgia brand, not a challenger brand. That is a meaningful strategic distinction.

I have seen this dynamic play out with clients across multiple categories. A financial services brand I worked with had spent years positioning around “innovation” without ever defining what innovation meant in the context of a current account. The positioning sounded right internally, but it gave consumers nothing to hold onto. Pepsi’s youth positioning has sometimes suffered from the same vagueness: tonally consistent, strategically hollow.

If you want a broader framework for how brand positioning works structurally, the Brand Positioning and Archetypes hub on this site covers the mechanics in detail. Pepsi is a useful lens for understanding why the mechanics matter more than the creative.

The Pepsi Challenge: When Challenger Positioning Actually Worked

The Pepsi Challenge, launched in 1975, is one of the most studied brand moves in marketing history, and it deserves the attention. Not because it was audacious, but because it was strategically disciplined in a way that Pepsi’s later campaigns rarely matched.

The mechanic was simple: blind taste tests conducted in public, filmed, and turned into advertising. Pepsi won more often than Coke. The campaign did not claim Pepsi was better in some abstract sense. It made a specific, falsifiable, consumer-verified claim. That is a fundamentally different kind of brand communication, and it gave the brand something it had lacked: a reason to believe that was grounded in evidence rather than aspiration.

The commercial effect was real. Pepsi gained market share. More importantly, it shifted the frame of the category conversation. Instead of competing on Coca-Cola’s terms, Pepsi forced Coke to respond on Pepsi’s terms. That is what challenger positioning is supposed to do. It is not about being louder. It is about changing the criteria by which consumers evaluate the category.

What followed, of course, is equally instructive. Coca-Cola’s response was New Coke in 1985, one of the most documented brand failures in history. But the lesson most people draw from New Coke is wrong. They focus on the product failure. The real lesson is that Pepsi’s challenge had become so commercially threatening that Coca-Cola abandoned a century of brand equity in a panic. That is a measure of how effective the challenger strategy had been.

Building a brand strategy around a verifiable consumer claim requires confidence in your product and discipline in your positioning. Most brands I have worked with are reluctant to make that kind of claim because it feels risky. It is actually less risky than vague aspiration, because it gives consumers something concrete to believe.

Celebrity Endorsement as a Brand Strategy: What Pepsi Got Right and Wrong

Pepsi’s use of celebrity endorsement has been both a defining brand asset and a recurring source of reputational exposure. Michael Jackson in 1984. Madonna in 1989. Britney Spears in 2001. Beyoncé in 2012. The list reads like a cultural timeline of popular music, which was precisely the intent.

The strategic logic was sound: align with artists at the peak of their cultural influence to transfer that cultural energy to the brand. When it worked, it worked extraordinarily well. The Michael Jackson partnership produced some of the most-watched advertising of its era and gave Pepsi genuine cultural presence in a way that no amount of media spend alone could have achieved.

The risk with celebrity-led brand strategy is that you are borrowing equity rather than building it. When the celebrity’s cultural standing shifts, the brand absorbs some of that movement. More fundamentally, celebrity association can become a substitute for positioning rather than an amplifier of it. If the only answer to “what does Pepsi stand for?” is “the artists it works with,” the brand has a dependency problem.

I judged at the Effie Awards, and one thing that stands out across the entries that do not win is how often brands confuse cultural adjacency with cultural relevance. Being near something culturally significant is not the same as meaning something in that cultural space. Pepsi has crossed that line more than once.

A coherent brand strategy uses celebrity and partnership as a vehicle for the brand’s own positioning, not as a replacement for it. The question is always: does this association make our position more credible, or does it just make us more visible? Visibility without credibility is expensive and fragile.

The 2017 Kendall Jenner Ad: A Case Study in Brand Positioning Failure

It is impossible to write about branding Pepsi without addressing the Kendall Jenner ad, pulled within 24 hours of its release in April 2017. The post-mortem has been written many times, usually focused on the tone-deafness of using protest imagery to sell a soft drink. That critique is accurate but incomplete.

The deeper failure was strategic. Pepsi attempted to claim ownership of a cultural moment, specifically the social justice protest movements that were defining public discourse at the time, without having earned any credibility in that space. The brand had no history of meaningful engagement with social justice issues. The ad was not an extension of a genuine brand position. It was an opportunistic reach for cultural relevance that had no foundation.

Brands can engage with culture. They should, when the engagement is authentic and earned. But there is a meaningful difference between a brand that has built its identity around a set of values over time, and a brand that sees a cultural wave and tries to surf it for awareness. Consumers, particularly younger ones, are increasingly good at distinguishing between the two.

The commercial damage extended beyond the immediate backlash. It reinforced a perception that Pepsi was a brand willing to exploit cultural moments for commercial gain, which directly contradicted the authentic, youth-connected identity the brand had been trying to project. Brand trust, once eroded, is expensive to rebuild. Brand loyalty research consistently shows that trust is a more durable driver of long-term commercial performance than awareness or affinity.

The lesson is not that brands should avoid cultural engagement. It is that cultural engagement has to be grounded in something real about the brand. You cannot borrow credibility you have not built.

The Logo and Visual Identity: When a Rebrand Becomes a Distraction

Pepsi has changed its logo more than a dozen times since the brand was established. The 2023 rebrand, which returned to a more retro-influenced visual identity, was the latest iteration. Each rebrand generates significant media coverage and internal excitement. The commercial impact is harder to demonstrate.

Visual identity is a legitimate component of brand strategy. A coherent, flexible identity system makes it easier to build recognition across touchpoints, and recognition is a genuine commercial asset. Visual coherence matters more than novelty, and the brands that build durable identity systems tend to prioritise flexibility and consistency over frequent reinvention.

The issue with Pepsi’s rebrand history is not the rebrands themselves. It is what they signal about the brand’s relationship with its own positioning. When a brand changes its visual identity frequently, it often reflects an underlying uncertainty about what the brand stands for. The logo becomes a proxy for a positioning conversation that has not been resolved.

I have sat in enough brand refresh meetings to recognise the pattern. The brief arrives framed as a visual update, but the real brief is: “we are not sure our brand is working and we need to do something visible.” A new logo is visible. It is also, in most cases, the least effective response to a positioning problem. It addresses the surface while leaving the structure unchanged.

If the 2023 rebrand is to mean anything commercially, it needs to be the visible expression of a repositioning that has been resolved at the strategic level. Without that, it is a design exercise with a press release attached.

Brand Awareness vs. Brand Preference: Where Pepsi’s Real Challenge Lives

Pepsi’s brand awareness is not the problem. Everyone knows Pepsi. The challenge is that awareness and preference are different things, and Pepsi has spent decades investing heavily in the former while struggling to close the gap on the latter.

Coca-Cola outsells Pepsi in most markets by a significant margin. This is not a distribution story or a product quality story. It is a brand preference story. When consumers make an active choice, they choose Coke more often. That is a brand positioning failure, not a marketing execution failure.

Measuring brand awareness is relatively straightforward. Measuring brand preference, and understanding the drivers behind it, requires more rigorous work. The distinction matters because awareness-focused marketing and preference-building marketing require different strategies, different channels, and different metrics for success.

When I was managing large media budgets across multiple markets, one of the most consistent findings was that brands with high awareness but low preference were often over-invested in reach and under-invested in the quality of the brand experience. They were visible but not compelling. Pepsi has that problem in many markets. The brand reaches consumers constantly. It does not always give them a strong enough reason to choose it.

There is also a focus problem. Pepsi’s parent company, PepsiCo, has a vast portfolio of brands that generate significant revenue. The cola brand is one asset among many. That corporate context shapes how much strategic resource and senior attention the Pepsi brand actually receives. Building brand preference requires sustained, focused investment over time. Portfolio management can work against that.

The problem with focusing purely on brand awareness is that it can create the illusion of brand health while the underlying preference metrics are deteriorating. Pepsi’s marketing investments have generated enormous awareness. The question is whether they have moved the needle on the metric that actually drives purchase.

What a Coherent Pepsi Brand Strategy Would Look Like

If I were working on the Pepsi brief, the starting point would not be the logo or the celebrity roster or the next campaign platform. It would be a clear answer to a simple question: what does Pepsi give people that Coca-Cola does not, and is that something people actually care about?

The honest answer in 2025 is that the product difference is marginal for most consumers. So the brand has to do the work. And for a brand to do that work, it needs a position that is specific enough to be meaningful and durable enough to sustain investment over time.

The challenger archetype is the most natural fit for Pepsi, and the history supports it. When Pepsi has operated as a genuine challenger, with a specific claim, a clear point of difference, and the confidence to be provocative rather than merely aspirational, it has performed well commercially. When it has tried to be a mainstream cultural brand competing on Coca-Cola’s terms, it has lost.

A coherent strategy would commit to the challenger position explicitly and build everything from there: the product innovation pipeline, the partnership strategy, the media approach, the visual identity. Challenger brands do not try to own every cultural moment. They pick their battles, and they win them clearly. Agile brand organisations are better positioned to do this because they can move faster when the right moment appears and hold back when it does not.

The other component a coherent strategy would address is consistency. Pepsi has produced brilliant work in isolated campaigns. What it has rarely managed is a sustained brand narrative that builds on itself over time. Each campaign tends to start fresh rather than building on what came before. That is a strategic discipline problem, not a creative one.

Brand equity compounds when the same idea is expressed consistently across time and touchpoints. Pepsi has the awareness base to build genuine preference if it commits to a position and holds it. The track record suggests that commitment is the harder part.

For more on how positioning frameworks and brand archetypes shape long-term commercial performance, the Brand Positioning and Archetypes hub covers the strategic foundations in depth, including how challenger brands can build durable positions rather than campaign-to-campaign visibility.

About the Author

Keith Lacy is a marketing strategist and former agency CEO with 20+ years of experience across agency leadership, performance marketing, and commercial strategy. He writes The Marketing Juice to cut through the noise and share what works.

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