Skip to content

Never mind Coke, Go Pepsi!

by on August 7, 2010

Broadband penetration in China totals 384 million. According to “Media Shifts to Social: China,” released by Netpop Research, 80% of respondents describe the Internet in China as social.

A survey by workplace solutions provider Regus Global, found that social networking has become a major business tool in China with two in five companies having successfully acquired new customers via social media. In addition, 52% of Chinese businesses have set aside a portion of marketing budget for social networking activities. At the front line of companies embracing interactive digital advertising, Pepsi has implemented what some consider to be the most successful Internet advertising campaigns to date in China. Yes I said Pepsi, not Coke.

Worldwide, Coca-Cola is number one on BusinessWeek ‘s Best Global Brands survey, Pepsi stays behind with number 23. However, Pepsi is beating its competitor in China. As stated by Euromonitor International, the Pepsi brand claimed 22.9% share of the country’s carbonated soft drink market, leaving Coca-Cola trailing behind with 22%. In an article in BuisnessWeek, Tom Doctoroff, North Asia director for ad agency JWT, states that, “Pepsi (in China) is one of the best digital marketers anywhere.”

To many, entering the Chinese market is a challenge. So what can other global brands learn from Pepsi about how to use social media to reach an audience and promote their product or service in the Chinese market?

According to Scott Galloway (NYU professor) and Doug Guthrie (NYU, George Washington University), who headed a study called “Digital IQ” by the L2 Think Tank, “success in the world’s fastest growing market (China) is inextricably linked to digital competence.”

What To Do

Identify Interests of Target Audience

For Pepsi the Internet in China has been the key to unlocking an incredible opportunity.

Back in 2006, Pepsi issued a challenge for consumers to write screenplays for Pepsi spokesman and famous pop singer Jay Chou, the campaign was called “Show Me Your Idea.” Participants had to write and then post their screenplays online. Then, Chinese netizens, voted on their favorite submission, the best entry was adapted and produced as a TV commercial.

According to China Market Research Group (CMR), the response from Chinese Internet users was extremely positive, with participants making comments on online bulletin boards such as “I was very happy to participate in this campaign, even though my work was not selected.” “I have truly learned a lot from this campaign, and I wish the best of luck to Pepsi.” The following video is the winning screenplay.

In the end, 28,000 Internet users submitted scripts, 690,000 board postings, and 5 million online participation/votes, are great indicators of the campaign’s success. As stated by Shaun Rein, founder and managing director of The China Market Research Group (CMR), in an article “The reason why digital interactive marketing campaigns like the Pepsi Creative Challenge work is that they add value by creating a mechanism for consumers to get involved.”

Relationships Matter

When I finished college in Costa Rica, I spearheaded communications with suppliers in China for a motorcycle retailer. The one thing I learned was that loyalty, respect and strong relationships are key in order to carry out a successful business in China.

Harry Hui, Pepsi’s chief marketing officer for China was quoted in an article saying that “Consumers in China are bombarded with messages, so merely telling them what they should drink or eat might not resonate, giving them a platform where they can talk back fosters a deeper relationship with the brand.”

Online, Pepsi is smart to create  social media networks with many complimentary platforms:

  • Tudou–video sharing
  • Baidu–forum
  • Taotao–blog platform similar to Twitter.
  • Tiany–forum
  • QQ–instant messaging
  • Qzone–social networking

Embrace the Culture

In August 2009, the company launched the “Pepsi Creative Challenge,” soliciting online birthday wishes marking the 60th anniversary of the founding of the People’s Republic. Pepsi’s goal was to create an interactive campaign that engaged consumers with the brand through multiple channels. The company partnered with Tencent, China’s Internet giant, to effectively allow Chinese netizens the ability to post, blog and IM their birthday wishes to China. Participants used QQ, Qzone and Taotao. The wishes where aggregated on the campaign’s microsite (pictured below), where netizens could vote for their favorite.

In total, 11.3 million votes were submitted, out of nearly 34 million entries, and the website got 22 million unique visitors. Impressive to say the least.

What Not To Do

Don’t be a Copy-Cat

Just because it worked for someone else doesn’t mean it will work for you. It is important to take the lessons learned from Pepsi and adapt them to your own product or service, copying the exact same efforts might not give you the same results.

For example, Coca Cola tried to develop online-interactive-advertising in China via its website iCoke. Like Pepsi, the Chinese were asked to vote via iCoke or by mobile phone to determine the outcome of an advertising campaign that has S.H.E., Coca Cola’s female pop band, captured by a monster.

However, Shaun Rein, Managing Director (CMR) stated in a article he wrote that “Coke’s campaign did not create the same buzz that Pepsi’s did in China. As one person who responded to a survey said: Coke’s campaign was not as exciting as Pepsi’s. Jay Chou is cool. It seemed that Coke was just copying Pepsi.”

The above statement highlights the importance of launching campaigns that are viewed as innovative. Also, it is important to have spokespeople that are in tune with the interest of key publics. Kudos to Pepsi, its distinctive marketing efforts have been large contributors to the brand’s success in China.

From → China

  1. Lots of great information and research here, Carolina!

  2. CarolinaB permalink

    Thanks Roela 🙂

  3. Caro I really like the “what to do” and “what not to do” list.

  4. First of all, I had about 25 windows open just following all your links … thanks for including all of this supporting information! I liked the format of your post again and how you chose to look at two large brands and their efforts in China. You make the case convincingly for why Pepsi is succeeding and some lessons that other brands might take from them – though you do point out that copycat marketing efforts will rarely work. What I would have liked to see is slightly more discussion about how Coke is falling short in this area beyond the fact that they had one campaign which many consumers felt was simply copying Pepsi. For example, are they actively using the 6 “complimentary platforms” that you mention Pepsi is using? Why or why not? Aside from this small point about Coke, though, the post delving into Pepsi and reasons for its success was good enough to stand on its own. (5)

  5. Blaak Jack permalink

    The reality show would be broadcast world-wide on reality TV, as I gamble my way through the Vegas Strip, looking for the pot of gold at the end of the rainbow.
    I am a Canadian Indian with no gambling experience, so being a Canadian and an Indian would get the attention of rich Indians across the world, who would love to experience Las Vegas.

    I’m coming to gamble @ Las Vegas Casinos.
    Invest in me for $2.3 Million for a seven day gambling extravaganza called, “SEVEN DAYS TIBET”.

    This reality show has the potential to capture audiences.


  6. I pay a visit every day a few web pages and information sites to read
    content, however this web site presents feature based posts.

  7. I constantly spent my half an hour to read this blog’s posts all the time along with a cup
    of coffee.

Trackbacks & Pingbacks

  1. jalia parsnip

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: