Hypothesis - Pepsi Vs Coke

PROBLEM

Why do some of us have such strong soda preferences? There's all this uproar of Coke vs. Pepsi, and really looking at the ingredients, the products aren't all that different. Both are made of carbonated water, high fructose corn syrup, caramel color, sugar, phosphoric acid, caffeine, citric acid and natural flavors (Pendergrast, 2000, p.6). The natural flavors are where they differ. Coke includes a "secret ingredient" known as Merchandise 7X, which sounds all mysterious and daring (Pendergrast, p.6). According to Pendergrast, the slightest bit can make a big difference! But it's hard to say why one person likes something while another person can't stand it. Though each soda has been around for more than a century, the two are still (and most likely always will be) competing for the world's taste buds. Some may find it absurd to fight an ideological battle over the sodas, especially over two products whose only difference is a few chemical compounds, but for others, this is serious business.

HISTORY

Coca-Cola is a carbonated soft drink sold in stores, restaurants and vending machines internationally. The Coca-Cola Company claims that the beverage is sold in more than 200 countries. It is produced by The Coca-Cola Company in Atlanta, Georgia, and is often referred to simply as Coke or (in European) as cola, pop, or in some parts of the U.S., soda (Pendergrast, p.6). Originally intended as a patent medicine when it was invented in the late 19th century by John Pemberton, Coca-Cola was bought out by businessman Asa Griggs Candler, whose marketing tactics led Coke to its dominance of the world soft-drink market throughout the 20th century (Pendergrast, p.6). The first Coca-Cola recipe was invented in a drugstore in Columbus, Georgia by John Pemberton, originally as a coca-wine called Pemberton's French Wine Coca in 1885 (Pendergrast, p.8) . When launched, Coca-Cola's two key ingredients were cocaine (benzoylmethyl ecgonine) and caffeine. The cocaine was derived from the coca leaf and the caffeine from kola nut, leading to the name Coca-Cola (the "K" in Kola was replaced with a "C" for marketing purposes) (Pendergrast, p.8).

In 1886, when Atlanta and Fulton County passed prohibition legislation, Pemberton responded by developing Coca-Cola, essentially a non-alcoholic version of French Wine Cola (Pendergrast, 2008, p.12). The first sales were at Jacob's Pharmacy in Atlanta, Georgia, on May 8, 1886 (Pendergrast, p.12). It was initially sold as a patent medicine for five cents a glass at soda fountains, which were popular in the United States at the time due to the belief that carbonated water was good for the health. Pemberton claimed Coca-Cola cured many diseases, including morphine addiction, dyspepsia, neurasthenia, headache, and impotence. Pemberton ran the first advertisement for the beverage on May 29 of the same year in the Atlanta Journal (Pendergrast, p.14). Coke concentrate, or Coke syrup, was and is sold separately at pharmacies in small quantities, as an over-the-counter remedy for nausea or mildly upset stomach.

Pepsi is a soft drink produced and manufactured by PepsiCo. It is sold in many places such as retail stores, restaurants, schools, cinemas and from vending machines. The drink was first made in the 1890s by pharmacist Caleb Bradham in New Bern, North Carolina (Capparell, 2008, p.3). The brand was trademarked on June 16, 1903. It was first introduced in North Carolina in 1898 by Caleb Bradham who made it at his pharmacy which sold the drink which was known back then as "Brad's Drink", and was later named Pepsi Cola possibly due the digestive enzyme pepsin and kola nuts used in the recipe (Capparell, p.5). Bradham sought to create a fountain drink that was delicious and would aid in digestion and boost energy.

In 1931, the Pepsi-Cola Company went bankrupt during the Great Depression in large part due to financial losses incurred by speculating on wildly fluctuating sugar prices as a result of World War I (Capparell, p.9). Assets were sold and Roy C. Megargel bought the Pepsi trademark. Eight years later, the company went bankrupt again (Capparell, p.9). Pepsi's assets were then purchased by Charles Guth; the President of Loft Inc. Loft was a candy manufacturer with retail stores that contained soda fountains. He sought to replace Coca-Cola at his stores' fountains after Coke refused to give him a discount on syrup. Guth then had Loft's chemists reformulate the Pepsi-Cola syrup formula.

In 1975, Pepsi introduced the Pepsi Challenge marketing campaign where PepsiCo set up a blind tasting between Pepsi-Cola and rival Coca-Cola (Blakesleen, 2004, p.2). During these blind taste tests the majority of participants picked Pepsi as the better tasting of the two soft drinks. PepsiCo took great advantage of the campaign with television commercials reporting the results to the public.

According to Consumer Reports, in the 1970s, the rivalry continued to heat up the market. Pepsi conducted blind taste tests in stores, in what was called the "Pepsi Challenge" (Blakesleen, p.2). These tests suggested that more consumers preferred the taste of Pepsi (which is believed to have more lemon oil, less orange oil, and uses vanillin rather than vanilla) to Coke (Blakesleen, p.2). The sales of Pepsi started to climb, and Pepsi kicked off the "Challenge" across the nation. This became known as the "Cola Wars."

In