PepsiCo – the History of Pepsi-Cola

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History

In 1893, Caleb Bradham created a drink in his home spicing it with kola nuts and the enzyme pepsin. At first, he called it “Brad’s Drink” and this was the first name of Pepsi Cola. It was so delicious that he soon started selling it in his neighborhood. Later, in 1998, this tasty beverage was renamed to Pepsi Cola and this was when the start of this world brand was put.



The first years Bradham prepared Pepsi in his drugstore, but soon he was not able to supply the increased quantity that people wanted to buy. In 1903 he rented a building where the bottling of the drink was moved. The sales in that year reached almost 8000 gallons. Seeing a big potential in his drink, Caleb started building a brand and actively marketing his product. He developed a new handy bottle, which could be sold almost anywhere. This simple move more than doubled the sales, which reached nearly 20 000 gallons in 1904. The next year the first logo of Pepsi was created. A few years later, Bradham hired the racer Barney Oldfield, who became the first face of Pepsi Cola, advertising it as a nice refreshing drink, a nice bracer before a race. Everything went well, Bradham enjoyed increasing sales and people enjoyed more and more his drink. It was initially branded as delicious, healthy and refreshing, and that had continued for the next two decades.

Caleb Bradham, the founder of Pepsi

Caleb Bradham, the founder of Pepsi

The “Roaring Twenties” helped for the fast growth of the company. These years were times of wealth and excess. But when the crash of 1929 hit the society, things changed dramatically. At the climax of the Great Depression, “Pepsi Cola Co”. filed for bankruptcy. Its creditors liquidated all of the assets of the business to collect their money. A guy named Roy Megargel bought the trademark “Pepsi Cola” and created a new company, but not for long. A few years later the business defaulted on its debts once again. This time Charles Guth, a candy manufacturer and businessman, bought the assets. He had been recently refused a discount on the syrup of Coca-Cola, which he wanted to sell at his retail stores.  Now he would sell Pepsi there.

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In 1936, Pepsi was sold in a 12 ounce bottle for 10 cents, but the sales at that price were not going well. At that time Coca Cola was sold at higher price, but in smaller bottles of six once, 6 cents each. Pepsi decided to reduce the price 50% in order to increase the revenue and fight against the strong brand of its main competitor. They combined this with some radio advertisements featuring “Pepsi-Cola hits the spot, Twelve full ounces, that’s a lot, Twice as much for a nickel, too, Pepsi-Cola is the drink for you”, and in fact the goal was achieved. The sales skyrocketed and the profits doubled in 1938. But the real benefit was that Pepsi became stronger and far more established brand.