1. How does PepsiCo balance those stakeholders such as consumers and shareholders interested in good tasting products and financial performance with special interest groups and regulators that are more concerned about nutrition?
2. Do you think it is logical for PepsiCo to partner with nutrition and water conservation nonprofit groups since it received heavy criticism for unhealthy products and wasteful water practices?

PepsiCo is one of the largest food and beverage companies in the world. It manufactures and sells 22 brands of beverages and snack foods that generate over $1 billion in retail sales. PepsiCo encompasses the Pepsi Cola, Frito-Lay, Tropicana, Quaker, and Gatorade brands and products in over 200 countries. The company’s headquarters are in New York and employs nearly 300,000 people. In 2006 Indra K. Nooyi became the CEO of PepsiCo. PepsiCo has received many awards and recognitions over the years, including being ranked in the top 25 of the best global brands and earning the Green Award by the Environmental Protection Agency.

The Pepsi recipe was developed by pharmacist Caleb Bradham in the 1890s. Originally marketed under the unassuming name “Brad’s Drink,” Bradham’s creation was renamed Pepsi-Cola in 1898 because of the pepsin and kola nut ingredients used. Awareness of Bradham’s new creation spread quickly, and in 1902 he decided to create the Pepsi-Cola Company so people everywhere could enjoy the drink. In 1903 the patent became official, and by 1910 Pepsi-Cola had franchises in 24 states and sold over 100,000 gallons of the syrup annually. However, the Pepsi brand encountered several rocky situations before becoming the success it is today. World War I proved to be an especially turbulent time for Pepsi-Cola. Severe fluctuations in sugar prices caused the company to lose money, and in 1923 Bradham sold the trademark to Craven’s Holding Corp., who shortly after sold it to a New York stockbroker named Roy C. Megargel. Megargel fought to revitalize the company but failed. In 1931 the Pepsi-Cola Company underwent its second bankruptcy. Candy manufacturer Charles Guth, president of Loft, Inc., saw Pepsi-Cola as a great investment and decided to purchase the company. Within two years the company was earning over a million dollars and was on its way to making history.

Guth had many challenges to overcome in order to save the struggling brand. Through the Great Depression, Pepsi carefully positioned itself as a low-cost leader and made advertising history when it released the nation’s first jingle “nickel, nickel.” With financially strapped customers reluctant to pay a nickel for a drink, Guth began offering twice the amount of Pepsi for the same price, a tactic that met with resounding success. World War II continued to test Pepsi-Cola’s strength with introduced sugar rationing, but Pepsi’s marketing campaigns and brand design helped Pepsi make it through the difficult period. For instance, Pepsi changed the colors on the label to be red, white, and blue to show patriotism.

Pepsi’s success allowed it to begin marketing internationally in 1945. As more people began earning more disposable income, Pepsi-Cola recognized the marketplace was changing. To maintain a strong brand, its marketing campaigns had to change too. Pepsi therefore said goodbye to the long-running “nickel, nickel” slogan and introduced a more lively “More Bounce to the Ounce” slogan to the after-war population. During the 1950s Pepsi evolved from the low cost price leader to a more lifestyle drink approach. For example, as Americans became more health conscious, Pepsi introduced slogans such as “The Light Refreshment” and “Refreshing without Filling.”