Cola Wars with Miles Klee

I never get paid in vodka and worships, you know?

What have I done wrong?

Welcome to You Wrong About, the show where sometimes, and without meaning to, we take a little break.

We have not had a new episode for you in a month.

It's been a month since Election Day.

Feels related.

I know it's probably been an overwhelming time for you.

It's been an overwhelming time for us.

Also, in terms of good things, I, Sarah Marshall, am doing some live shows with our beloved friends Kelsey Weber Smith and Miranda Zickler of American Hysteria.

Our producer Carolyn Kendrick has a new album out, Each Machine.

So things are busy all over in scary ways, in exciting ways, and we're just so happy that you're here along for the ride with us.

As I'm recording this, it's the day of our Seattle massive seance show at the Moor, December 10th, but we have a couple more shows coming up.

We are doing our massive seance where Chelsea Weber Smith and I decide to not just talk about spiritualism and ghosts, but try to summon some real ghosts of our own.

And we're going to be doing a show in San Francisco at the Palace of Fine Arts Theater on January 11th and in beautiful, breezy, downtown LA at the Regent Theater on January 24th.

We really hope that you can be there and if you can't, our goal is to send out just a big glob of love and energy and Fleetwood Mac

that will find you wherever you are.

You'll never get away from the sound of the woman that loves you.

So on a lighter note, or kind of lighter, our new episode is on the Cola Wars with Miles Klee.

I was very excited to do this topic.

It is the last lyric in We Didn't Start the Fire, the Billy Joel magnum opus.

And that seemed like a fun episode to me, but it is, of course, also a history of some of the ugliest aspects of American colonialism, of business, of the collusion between business and war and government.

And say it with me,

it was capitalism all along.

Miles Klee, of course, wears many wonderful hats.

He writes for Rolling Stone, and we are going to talk today about the history of Coke, where it came from, how it or anything else can become quite so ubiquitous, and why we as Americans have such strong feelings about Coke versus Pepsi.

That is about it from me.

We have bonus episodes for your perusal.

We have a new one up today about Bachelor Nation with Megan Burbank.

I have never seen an episode of The Bachelor.

Megan recaps The Bachelor as part of her work as a gadfly and gal about town.

And so she told me the tale of The Bachelor/slash The Bachelorette.

And

boy, did I have a lovely time.

Again, kind of a light-hearted topic, but it gets right to the core of a whole lot of stuff.

And that's it.

Thank you for joining us.

Thank you for being with us.

Thank you for listening.

Thank you for yearning with us for however long you have been.

Here's your episode.

Welcome to Your Wrong About, the podcast where we talk about life under capitalism.

And with me today is Miles Klee.

Miles, hello.

Hello, how are you?

I'm pretty good.

I think appropriately for what we're recording, we're in the time of year.

It's October as we're having this conversation and it's the period where America can't decide if we're selling Halloween stuff or selling Christmas stuff.

And it's just both at once, which is, you know, a very, that's how we do fall.

Yeah, how are you doing?

How does October find you?

I'm good.

Yeah.

Nightmare Before Christmas predicted this.

Yeah.

And I'm having you on today to talk about a topic that to me and for many people, I feel like I should be saying this in like a James Lipton voice for whatever reason, which to me is inextricable from the lyrics by Mr.

Billy Joel.

Hypodermics on the shore, China's under martial law, rock and roller, cola wars, I can't take it anymore.

And I've always found it delightful that of all the songs listed in Billy Joel's We Didn't Start the Fire, The thing that leads him to not be able to take it anymore is the Cola Wars.

And that's what we're talking about today.

The straw that broke Billy joel's back and this was a strong man we're talking about he he he just couldn't he just couldn't put up with it no i mean what are what are your feelings about uh cola products or soda more generally do you have any dog in this family yes i mean i i was raised by a diet coke woman of the 90s

well we're starting off on the same page here because i i wanted to do this episode because it's just crazy to me how loyal I was to the Coca-Cola brand as a kid and into adulthood.

I mean, part of it is that, part of it is just that soda is addictive, right?

But I was also strangely dogmatic in my belief that Pepsi was bad.

It tasted wrong.

If a restaurant served Pepsi instead of Coke, that was a problem.

I mean, I think to people who don't really drink soda, this probably sounds ridiculous.

They would maybe argue the flavor is the same.

But to this day, I swear I would know the difference in a blind taste test.

And I will always prefer Coke.

That's just a fact.

Oh, yeah.

Yeah.

So, like, the question is, have we been brainwashed?

Right.

Am I making that up?

Am I, in fact, the pod people?

You know, it's funny.

I was on the phone with my mom and sister talking about this topic the other day and the seemingly innate belief that Coke is better.

And they both laughed and they said, well, it is, though.

And there's a political dimension to that as well.

Yes.

Well, and I and the sort of American quest for...

being the best of something or dominating an area.

And also maybe this, like if they do taste different, then maybe it's based not on superiority than on like Coke gets there first.

So everything else feels like an imitation unless you're in Pepsi country, wherever that is.

Yeah, well, let's talk about Coke getting there first.

So

what we recognize as soda kind of dates back to early 19th century.

Before that, artificially carbonated mineral water had taken off as a health fad.

And people started adding fruit flavors and extracts that we've been using to mix beverages since like the medieval era.

At this time, sodas are still associated with medicine, you know, sold in pharmacies.

So, this kind of a snake oil cure for whatever ails you.

Huh.

Right away, you also see how geopolitical forces have a role to play here.

So, like, British colonizers in tropical regions had to take the anti-malarial drug quinine, but it was so bitter they mixed it with sugar and water, which gave us tonic water.

Then they invented genitonic because, of course, they also had to get wasted on the job.

No, you don't want to be sober when you're taking over a country.

No, no, no, no.

And I'm sure listeners are aware of Coca-Cola's origins as like a dubious medicine.

But what I didn't know is that it came directly out of the Civil War.

Yeah, tell us about that.

Because I feel like there's like, there's a joke about it in the T.C.

Boyle book, The Road to Wellville, and that's my historical context for it.

But that doesn't get me that far.

Yeah, so

it's a southern brand.

I mean, a young doctor and chemist named John Pemberton served as a lieutenant colonel in the Confederate Army.

And in a pointless battle that took place in Columbus, Georgia, a week after Robert E.

Lee surrendered at Appomattox.

Oh, get it together, you guys.

He took a saber wound to the chest.

Unfortunate.

In the following years, he became addicted to morphine that he used to treat the pain from this injury.

And meanwhile, he was inventing patent medicines at his drugstore.

Eventually, he came up with something intended to cure his addiction and other veterans hooked on morphine in this post-war period.

Pemberton's breakthrough is called, not joking, French wine cola.

I drink it.

I buy it.

I try it out.

$2.99, right?

Oh, I mean, and when you hear what's in this, this was his take on a mid-19th century French patent medicine called Vem Mariani, which mixed bordeaux wine and coca leaves.

Oh.

The ethanol in the wine extracts the cocaine from the leaves.

So yes, it's a wine and cocaine cocktail.

Well, that would be a really good follow out to the espresso martini if we had slightly different laws.

It would be huge.

Oh my God.

The hot girl drink if they care.

Every Bravo reality show would just have like a contract to basically shoot a fire hose of this stuff at the cast.

Drinking it out of big gold flutes the whole time for continuity.

Pemberton adds extracts from the cola nut, which is a seed of a plant native to Africa that has caffeine in it,

and the aromatic flower Daimania, a woody shrub found in the Americas.

So cocaine, of course, was a legal pharmaceutical at the time.

It's considered a remedy for morphine addiction.

You could just get off morphine and on cocaine and supposedly that's fine.

Yeah, I think just needless to say, we could surmise that the drink's popularity extends beyond its health applications, quote unquote.

I mean, I don't know how the cola got from Africa to Atlanta, but it does feel like colonialism has something to do with it.

And And so the fact that we have an African nut being used as an ingredient by a former Confederate soldier is like, it's just there.

Oh, yeah.

And we'll see how the colonialism goes both ways as these brands expand abroad.

And, you know, we should also note that the coca leaves, those are coming from like Peru.

Right.

Wow.

So these are all very exotic ingredients that are being extracted from elsewhere in the world.

And that will cause problems for Coke later on.

And sold to Americans with a pack of random claims, which is really a a lot of continuity.

As somehow French.

Perfect.

So by 1886, Pemberton moves this burgeoning operation to Atlanta.

That'll remain Coke's headquarters forever.

And they will not be subtle about it.

No, no,

it's a big part of the identity.

But he runs into a big problem right away, which is that Fulton County, you know, where Atlanta is, bans alcohol that same year.

So he could still sell French wine cola elsewhere in the state, but he needs a non-alcoholic version for the the home market.

So his new formula, replacing wine with sugar syrup, became Coca-Cola, which he marketed as the temperance drink, a supposed cure for, quote, nervous affections.

Oh boy, it's non-alcoholic.

Yeah.

It still had cocaine in it.

But no alcohol, which is because we're interesting people.

Anyway.

I should say too that, I mean, the cocaine, the amount of cocaine is often wildly exaggerated when this comes up today, because I think we like imagining people at the turn of the century just absolutely zooted off soda.

That's just a very funny image.

So it is.

It's very fun.

We'll just indulge that.

Yeah, but it does seem like, you know, it's,

you don't want to put too much cocaine in your soda or else people are going to have heart attacks and not buy it again.

I will shout out Pemberton's partner, Frank Mason Robinson.

He came up with the name Coca-Cola and he also wrote the flowy Coca-Cola script that you recognize.

In some ways, the true genius behind the product, I have to say.

Yeah, that script is gold.

It hasn't changed, really.

You know, Pepperton didn't live to see his invention become a global or even nationwide phenomenon.

He died in 1888.

Before that, Coca-Cola had caught the attention of Asa Candler, a Georgia tycoon and politician who would later become mayor of Atlanta.

So over the next couple of years, he secured...

ownership of the formula and brand for a total of $2,300.

Love it.

Or about $80,000 in today's today's dollar, still a great deal.

Well, you know, something similar happened with Jell-O, where it was invented by this guy who just like could not make it work commercially for whatever reason and sold the rights to it for $400 at the time, which was like around 1900.

Yeah, I love how often in the history of these sodas that somebody else comes along over and over and says, well,

I have bigger ideas for this than this asshole can possibly pull off.

So in Candler's case, this involved taking down existing local competitors and prying the Coca-Cola name loose from Pemberton's opium addict son.

Oh, well, that sounds like he would have to do some stuff that might stop someone else from sleeping well at night, I would wonder.

And over the course of this succession-style drama, he also formed the Coca-Cola company that still exists today.

But even before his takeover was complete, Candler went on the offensive with advertisements that sound quite familiar more than a century later.

So in 1889, he took a full page ad in the Atlanta Journal to announce that his drugstores were, quote, sole proprietors of Coca-Cola, delicious, refreshing, exhilarating, invigorating.

Now, wouldn't you want to drink that?

I mean, yeah, it's, it's, I don't know.

I feel like the amount of caffeine people are forced to consume daily.

It's like, are we different?

Nah.

I don't know.

Dutch Brothers is doing really well.

I mean, I would identify this as the moment when Coke acquires this identity of something more than a health talk.

Right.

Tonic.

You know, now it's this effervescent treat.

So by the turn of the century, 1903, Coca-Cola has a competitor marketing itself in almost the exact same terms.

Oh, no.

This is Pepsi-Cola,

which is bottled in New Bern, North Carolina.

It has the tagline, exhilarating, invigorating, aids digestion.

Oh, no.

So Pepsi was originally called, and I love this, Brad's drink.

A pharmacist named Caleb Bradham came up with the formula in the 1890s.

Like Coke, he was using cola nuts.

Oh my God.

As his business grows, Bradham buys the trade name Pep Cola and rebrands to Pepsi to fit the claim that the soda is good for dyspepsia or indigestion.

Love it.

Side note, not true.

That's like an old wives tale.

So many good concepts in there, though.

I also, doesn't Brad's drink sound like there's like a diner with like a regular name Brad and he orders the weirdest thing you know it's like a like a grape soda with an egg in it they're like yeah it's Brad's drink

nobody else orders it

for Brad yeah okay well that's um

how on earth does Asa handler deal with this glove slab to the face

well it's interesting there are different challenges at first so unlike coke pepsi-cola contains no drugs not even caffeine wild uh bradham Yeah, Bradham specifically wanted to create a beverage without the narcotics found in other soft drinks because, you know, this is actually sort of starting to become a political issue.

I mean, this is relevant in terms of competition because through the early years of the 20th century, Coca-Cola is facing pressure to remove its, let's say, active ingredients.

The Gilded Age has produced all these really potent drinks.

And along with that came new anxiety over their habit form and quality.

A lot of this backlash is distinctly racist and anti-immigrant,

you know, based around fears that the non-white underclass is likely to become these dangerous raving addicts of soda.

Because every time white people get addicted to something, we're like, it's not,

we're fine.

We can have all we want.

But it's other people,

minorities, they can't have it.

That would be awful.

Yeah.

And like I said, Coca-Cola is a product of the Jim Crow South.

You know, this same climate cooked up a moral panic about cocaine supposedly contributing to black crime.

So by 1903, Candler amended the original formula, switching to de-cocinized coca leaves.

He sells the cocaine extract that is produced as a byproduct to pharma companies because it's still a pharmaceutical.

In 1906, the U.S.

government passes the Pure Food and Drug Act, which eventually gave us the FDA and made manufacturers liable for stuff like, you know,

accidentally putting arsenic in children's candy.

Yeah, you shouldn't do that.

I mean, yeah, I know that there's a lot to complain about in America, but like, I am very appreciative of the existence of the FDA and the ADA, and it's worth pointing out.

Pepsi takes advantage of this by adopting the slogan, the original pure food drink.

Oh, love it.

Yeah, it was conceived from the start as a beverage without potentially harmful ingredients or additives.

Coca-Cola has all the problems here.

The Department of Agriculture seizes 40 barrels and 20 kegs of a shipment and brings a lawsuit against the company, alleging that its added caffeine content is a public health hazard.

So concerns just about the caffeine at this point.

Oh, my God.

Yeah.

This gets tied up in the courts for years.

Coca-Cola originally wins.

The government appeals all the way up to the Supreme Court.

Says the case should not have been dismissed and would have to be tried in a lower court.

But Coca-Cola, to avoid this, voluntarily cuts its caffeine content in half, covers all legal costs.

You know, meanwhile, Pepsi is kind of...

uh rolling along here no no issues with the government yet it's still small still a health food yeah it's pioneering what will become a long-term strategy of celebrity endorsements.

And it runs newspaper ads featuring race car driver Barney Oldfield, who calls it, quote, a bully drink, refreshing, invigorating, a fine bracer before a race.

I love it.

You got to have a fine bracer.

World War I is a turning point for both brands.

Unlike Pepsi, Coca-Cola is spending millions on advertising already.

Basically an unprecedented level of mass marketing at this point.

It's already nationwide.

It's exporting abroad.

It's part of why they're facing government scrutiny.

But this popularity also means they're dealing with more than 100 imitators selling knockoff sodas, knockoff Coca-Cola.

Can I ask,

because one of the reasons we're, I don't know, that this timing for this episode felt right was that Coke has managed to associate itself so strongly with Christmas.

When does that happen?

Pretty early.

Yeah, we will see that there are, like in the 1930s and 40s, they get a a lot of Santa ads it's part of their

becomes part of their

family slash wholesome slash holiday marketing which is you know kind of knitted in with

their all their nostalgia plays because coke even even as soon as it exists is immediately already playing on nostalgia for the very recent past essentially

Coca-Cola and the hundreds of franchisees it has bottling the soda around the country realize they have no good way of protecting the brand.

In 1914, their head attorney, Harold Hirsch, calls on everyone to band together behind a new bottle design,

telling them they will have to absorb the immediate expense because, quote, we are not building Coca-Cola alone for today.

We are building Coca-Cola forever.

And it is our hope that Coca-Cola will remain the national drink to the end of time.

Oh.

It feels very American to like invent a thing and then the next day be like, this will be the most important soda in, you know, until the history of time.

And it's like, okay,

it's soda, you know, calm down.

Several glass companies are given the challenge to create a bottle, quote, so distinct that you would recognize it by feel in the dark or lying broken on the ground.

I gotta say, they did do that.

I mean, they snapped.

The winning company came up with the curbaceous design we all know, sometimes referred to as the hobble skirt shape.

There was a trend at the time for narrowly tapered skirts that hobbled women who wore them.

They couldn't walk in them.

As well as the May West bottle for similarly horny reasons, I think.

The May West bottle, that's fantastic.

It was actually inspired by an illustration of an elongated cocoa pod, but,

you know, sex elsewhere.

Businessmen in the early 20th century would just get turned on by, you know, pencils

if they looked at them long enough.

Candler becomes mayor of Atlanta.

No more time for Coca-Cola.

He steps away.

He gives controlling stake in the company to his kids.

They apparently weren't up for the job or just wanted some quick cash.

So they sold it to investors led by another Atlanta businessman, Ernest Woodruff, for $25 million.

In what year?

That would be 1919.

Okay.

It goes public that year.

It's stock priced at $40.

One share bought that year with dividends continually reinvested.

About $10 million today.

Gosh darn it.

So that's what I'm using my time machine for.

Yeah.

So this acquisition creates a central part of the Coke legend.

As collateral for the loan, Woodruff needed to acquire the company.

He gave his bank the only written copy of the formula for Coca-Cola syrup, and they kept it in a vault in New York.

When the loan is repaid, he gets it back and puts it in a vault in his Atlanta bank.

The document is now in Coca-Cola's own publicly displayed vault at their World of Coca-Cola Museum.

And the formula remains one of the ultimate trade secrets in existence, in part because they've never patented it.

I mean, which they would have made it public domain 20 years later.

This way, they can keep it secret.

I mean, but as you might guess from the cheeky museum display, there's a bit of theater to this.

I mean, if you pulled off an Ocean's 11 heist and got your hands on the formula, you still wouldn't be able to market it as Coke, which is the valuable part.

I mean, the brand is the product.

You also can't compete with Coke's global distribution system.

And on top of everything else, you don't have a special contract with Stepan Company in New Jersey, which is the only corporate entity in the U.S.

that is specifically authorized by the DEA to import cocoa leaves.

It still has coca leaves in it?

Stepan doesn't even process that much cocoa.

And you don't taste, you're not tasting that

in the drink.

It's just this weird signature thing, and it goes to all this trouble to de-cocanize these leaves.

And this company is still thought to be creating about $200 million worth of cocaine annually as a byproduct of the leaves it processes, which is either destroyed or sold to the only pharma company in the U.S.

permitted to receive it as like an experimental drug based.

You're really, you're giving some good heist inspiration in this section, I think.

I will say that the arrangement with the Stepan Company, which de-cocinizes the leaves, this whole arrangement is a result of Coca-Cola's power already in the early 1920s because they effectively lobbied Congress as they passed something called the Harrison Act, which otherwise outlawed the importing of coca, but includes a special provision for the use of decoconized leaves.

And whose idea do we think that was?

I really know.

Is this an expression of the fact that by this point they're big enough and they're generating enough gross domestic product, I guess, that it's

valuable for the government to stay on their good side?

I think so, yeah.

I mean, they have done a good job not only of cozying up to government power and political power, but for certain, this is like, again, they were a product of, you know, the Gilded Age and up through the roaring 20s.

And big business is,

you know, good for everyone at the top.

They're all basically the same people.

As I said, Candler becomes, you know, mayor of Atlanta.

It's like, you basically have politicians running the place already.

So the connections go really deep.

And especially in Atlanta, as we've just said,

we're going to see just, you know, how powerful they kind of are in that area and, you know, increasingly in DC as well.

Yeah, I mean, as all this was happening,

Pepsi is failing.

It goes bankrupt in 1923.

Pepsi.

Sold to a new owner who can't revive it.

Over about a decade, Coke is offered the chance to buy Pepsi several times, but never does.

Are the people running Pepsi?

Like, the people aren't responding well to purity, sir.

They're like, you know, we have a bottling operation.

Like, it's kind of big.

Like, don't you want this?

I mean, instead, in 1931, Pepsi is bought by a guy named Charles Guth.

Love it.

Guth is what you might call a bit of a bastard.

Not only was he known for being sued by his business partners after screwing them over.

That's familiar.

He was acquitted in a murder trial in his 30s.

Oh.

After killing, yeah, he killed his black chauffeur.

Jesus.

Supposedly because of a dispute that arose over Guth not wanting his milk delivered at the same time as the chauffeur's.

Makes no sense.

A really awful case that the NAACP brought a lot of attention to at the time.

Of course, he gets away with it.

And this wonderful human specimen is, of course, the president of a major candy company called Loft when he buys the Pepsi formula.

Of course.

Yeah.

So, yeah.

So he's like a classic Willy Wonka character.

I mean, in a way, I find it...

impressive that it made it to trial at all as opposed to being just kind of dismissed by the system at the time.

Yeah, that's how bad it was, basically.

Yeah.

So he acquires it through his own family business as opposed to Loft, the candy company.

His own family business makes soft drink syrups, and he's motivated to do this also because of spite.

Against Papa, I would guess.

Actually, no, against Coca-Cola.

Oh,

chiseler that he is.

He's mad that Coca-Cola won't give him a discount on the Coke he's selling at his own drugstore.

Okay, all right.

So he says, fuck it.

We're a Pepsi Soda Fountain now, and I own the brand.

Things still don't go that well.

Guth tries unsuccessfully to get Coca-Cola to buy him out at one point, but they won't.

Then he has the chemists at Loft, the candy company, reformulate the Pepsi-Cola formula.

Guth moves the company to Queens, New York.

They come out with a six-ounce bottle.

But the game changer comes at the height of the depression.

Pepsi debuts a 12-ounce bottle that is critically the same price as the six-ounce bottle, just a nickel.

By the mid-1930s, Pepsi can be found around the world.

It's the second largest company after Coca-Cola.

Boom, done.

Wow.

Yeah, undercutting until you achieve domination and then not doing that anymore is truly one of the great American business strategies.

You know, Pepsi is really stealing Koch's playbook here.

I mean, they're leaning hard into the advertising game because there's not much to distinguish it on the flavor flavor level.

People don't really get a difference between the two.

So they're hiring skywriters.

They're putting the name everywhere.

They're just drilling it into people's heads, and it works.

And that does feel like kind of a marker of what the 20th century and then, you know, the 21st century became about for consumers, where you have, you know, companies

marketing virtually indistinguishable products and having to continually find ways to make them seem different from each other.

But something else interesting was going on, and that's to return to Coca-Cola, which was based in the deep Jim Crow South, led by Ernest Woodruff's son, Robert Woodruff, a segregationist who publicly said his fair share of racist things.

It did not mark it directly to black people at all.

I mean, part of the reason cocaine was removed from the drink, as we said, was because of this racist moral panic.

The Coke ads of this time really painted as the drink of wholesome white respectability.

Often there's a white guy in a suit and a tie, which I don't associate with soda at all.

I even found a poster where it's like a man in a tuxedo and a woman in a gown being served Coca-Cola on a silver tray by a black butzler.

All right, right.

So it is, it is the, the, the soda of white supremacy as well.

Yeah, I mean, some of this is like less overtly harmful.

I mean, some of the 1930s images are by Norman Rockwell.

Yeah.

So pure uncut nostalgia, but still a very like genteel southern white milieu.

I mean, it's like, it'll be like a little white boy in a big straw hat fishing with his dog and he has a Coke.

So you get the picture.

Well, it's like when you see sort of a Republican attack ad now and it's like a white family in a cornfield, you're like, fuck you.

You know, and you're like, I'm not against any of these things, but I know what this is standing for and what it is saying it's against.

Unnecessarily nostalgic, white, idyllic, fan imagined past.

feels still part of it.

Yeah, and it's not as it's not as subtle as they think.

No, yeah.

I mean, Charles Guth, who literally murdered a black man, probably wouldn't have seen the possibility here.

But fortunately for Pepsi, shareholders of the Loft Candy Company sued him for breach of corporate duty for snatching up the Pepsi-Cola formula for himself instead of selling it to them.

They also accused him of using their assets and employees to build the Pepsi Empire and line his own pockets.

Guth lost this case, and it was such an important precedent that there's now a principle in corporate law known as the Guth rule, which basically says that if you as a company director recognize a business opportunity that your employer can financially and logistically take advantage of, you can't just take it yourself behind their backs.

It would have been different if Loft couldn't afford to buy Pepsi or was in some radically different industry, but they're like the world's biggest candy company.

Obviously, they would acquire Coca-Cola's upstart competitor if they'd had the chance.

And naturally, they realized this as soon as Pepsi started to actually succeed.

Wow.

So, in the aftermath of this lawsuit, Loft merges with Pepsi, keeping the Pepsi-Cola name, and Guth is replaced with a new CEO, Walter Mack.

Mack is a far more liberal Jewish man from Queens, and he is the one who starts to appreciate that Coca-Cola has no standing in black markets.

Oh, interesting.

So he likes noticing things.

He's a noticer.

He hires an African-American sales team.

that targets urban northern regions and black areas of the south.

They put out ads with black models that don't conform to offensive stereotypes.

There's no Aunt Jemima and Uncle Ben.

It's like middle-class, well-dressed, aspirational families.

Some ads highlight prominent black businessmen and women.

They get Duke Ellington as a spokesman.

It's this extraordinary experiment in multicultural marketing, all because Pepsi notices that Coca-Cola is deliberately ignoring this whole segment, but it is not by any means some enlightened or woke campaign.

Let's say that.

It's probably no such thing as a woke ad campaign.

Oh, no.

I think it's just an instructive example because it's something that looks progressive, but it's actually just pretty cutthroat.

Right.

And well, and it's like the idea of like that selling a product to somebody means noticing that they're there and that they exist as people.

And that's sort of humanizing.

But it's also, you know, it's fundamentally about realizing that you could get their money.

So, yeah.

And Pepsi still has to walk this super fine line because by courting a black customer base, they risk white backlash.

They could, they could have the go woke, go broke problem.

And over the 1940s, they do see a stigma develop so that even as Coca-Cola becomes known as the Jim Crow soda, Pepsi gets attached to like racial epithets.

I mean, you have a few attempts at boycotts as well by racist white people.

And this all comes to a head in 1949 when Walter Mack gives a speech at a bottle or convention explaining that Pepsi will have to gain, quote, a little more status.

and no longer be strictly identified as, quote, an N-word drink.

Ooh.

Buddy.

Buddy, buddy.

Yeah, yeah.

Our liberal hero, not so much.

I tried to not have high hopes, but even so, you know.

So, Edward Boyd, a Pepsi employee who was one of the only black corporate executives in America back then and genuinely adored Mac, other than this, was so offended by this that he walked out of the presentation.

He had seen, he'd overseen a lot of the sales strategy that helped Pepsi make inroads with the black markets, all while his team faced discrimination from other Pepsi employees, not to mention out on the road and even threats from the Ku Klux Klan.

He leaves the company and his team basically disbands.

Only one member will climb the corporate ladder, Harvey C.

Russell, who in 1962 becomes the first black vice president at any major American corporation.

However, I mean, as Pepsi is expanding in the U.S.,

World War II gives Coke a big opening to expand their footprint abroad.

Oh, boy.

And it comes to be seen for better and worse as a defining symbol of Americanism and globalization.

How does World War II help Coke out?

What does that involve?

It all kicks off with a kind of corporate patriotism.

Robert Woodruff declared in 1941 that every American serviceman should be able to get a bottle of Coke for a nickel, no matter where in the world, no matter what it costs the company.

This entailed a huge effort.

to ship the soda to the troops and set up dozens of bottling operations as close to the front lines as possible in North Africa and Europe, South Pacific.

As the secondary brand, Pepsi had a much harder go of it and complained that the U.S.

government was favoring Coca-Cola in its military theaters.

Coca-Cola was exempted from sugar rationing, for example, which is crazy to me.

Yeah.

But Pepsi still sold plenty of soda at like army bases and defense plants and what have you.

I mean, the war benefited both sides, no doubt.

It is fascinating to think of like just the, you know, the construction crews that were like knocking up these coke plants, you know, in Algeria or whatever

during World War II.

Like, what that's a,

what was that like, you know, day-to-day, the World War II coke plant?

Was it scary?

You know, were you, were they going to bomb you to take down morale?

Yeah, I don't know if those were targeted, but, you know, it probably looked like any other kind of

munitions manufacturer.

Wait, God.

Got to worry about that.

If something is manufactured and distributed on the scale that we do things, you know, for the last hundred years or so, then like nothing ever stays simple.

It always gets involved in war and corporate racism and everything else.

This also sets us up for a great example of Coca-Cola playing both sides.

Of course, it becomes associated with the patriotism of

our boys in World War II.

But before the U.S.

entered the fray, Coca-Cola had...

distributed sodas at Hitler youth rallies and embraced the swastika at bottling conventions in Germany in part because a competitor in Germany had tried to demonize it as a Jewish drink.

Coke.

I mean, the weirder footnote here is once the U.S.

imposed the trade embargo with Germany, preventing the import of Coca-Cola syrup, the siloed German branch of the company tried to invent a substitute using the crappy available ingredients they had, what the head of the regional operation called Leftovers of Leftovers, and they called it Fanta.

Short for the German word Fantasy or imagination, because they were told to use their imagination to come up with a good name.

Just something fun to think about when you see someone drinking Fanta.

It's more to connect into the Nazis than I expected, but what's nice about it is that it means that the Nazis had terrible soda.

That's something.

Wow.

They wanted Coke and this was the best they could do.

They really ended up pretty far away if the modern version is at all close.

You know, as Coke is spreading around the world,

there are many who try to stop its relentless march into their domestic culture.

This process becomes known as coca-colonization.

Very clever.

I don't know who came up with that, but man, that's good.

I do really like that.

Yeah.

Because it is, I mean, and is that from a sense partly of like,

you know, this being the period when America does start to take over the world with our products and our exports and like everybody.

starts wearing our trash.

Absolutely.

Absolutely.

There is an awareness of America becoming a superpower and in particular, spreading our capitalist nonsense everywhere.

So some of the staunchest opponents of Koch in the post-war era would be the French Communist Party, God bless them,

which not only argued that the company was no help in their efforts to rebuild the war-torn nation, but that its vast corporate hierarchy could be used for espionage.

I don't see why not.

Who can blame him?

I'm sure Koch had spies abroad, you know.

You're just like spitting out Netflix series left and right here, you know?

It could be a 10-season show um another funny development of note this time you know how in the south people say coke to mean any kind of soda i love that yeah yeah

so that's because from the very early days people abbreviated abbreviated the name coca-cola that way and coca-cola fought for decades to reverse this trend unsuccessfully they didn't want any association with the coal-based fuel coke and besides they hadn't trademarked coke okay so they went as far as running ads in the 1910s pleading with people to order coca-cola by its full name to ensure they're getting the genuine article.

Because if you just say Coke, who knows what you're getting right now?

Oh, you got it.

It makes no difference.

They just continue to live with the problem that Coke might turn into a generic trademark, you know, similar to how anybody can sell their pain relievers as aspirin, even though that used to be like a bear brand name.

If you lose control of the word, then it's over.

In the early 40s, they start to use Coke in advertising materials and they create a very confusing mascot to explain that Coke and Coca-Cola are the same thing.

Something that anyone could have figured out because that's how language works.

But yeah.

Okay, who is this horrible mascot?

His name is Sprite Boy.

There was no such soda as Sprite,

by the way.

This was a rather demonic-looking elf child who wore a Coca-Cola bottle cap for a hat.

And he was designed by the artist Haddon Sonblum, whose illustrations of Santa Claus for Coke ads are some of the most recognizable depictions of the character that we've discussed.

I should say there's a bit of a misconception that Koch like invented our contemporary image of Santa, the red and white jumpsuit being some kind of subliminal brand hypnosis.

But the 19th century artist Thomas Nast was doing basically the same thing before Koch existed.

So in the second half of the century, you know, as we said, America is this superpower.

And a lot of the jockeying between Coke and Pepsi comes to resemble kind of a Cold War chess game where they compete to infiltrate new countries before the other.

right and you begin to resemble each other more closely than you resemble anybody else

uh before we move past the mid-century fascism though uh i will drop my um most academic reference uh there's a theodore adorno passage i happened to come across the other day that really made me bolt up right.

Adorno was writing about the rhetoric of Martin Luther Thomas.

This was a fascist American demagogue on right-wing Christian radio in the 1930s.

And Adorno had had this to say, quote, the mode of selling an idea is not essentially different from the mode of selling a soap or a soft drink.

Socio-psychologically, the magical character of the word leader, and therewith the charisma of the Führer, is nothing but the spell of commercial slogans taken over by the agencies of immediate political power.

That's bars.

That's bars.

I mean, to me,

the example of a soft drink is really striking.

If you flip this around, if you flip this around for this era, you could say we're enthrall to the global dominance of the big soda brands.

The same way people can support authoritarian rule and be excited about that.

It's something that like it doesn't cost that much.

You kind of go through it.

So you need to keep buying it.

So they need to keep advertising it.

And they're all basically the same.

And so it has to come down to like selling the feeling.

And yeah, that if you look at just

our current totalitarianism, that it is about like selling an emotion, selling an affect of space, but there's nothing of substance really in the pitch.

So for the Soda Giants, the 50s and 60s are all about maximizing optimism over American prosperity and technological progress, but without any of the pesky anxiety of the atomic age.

Nobody at Koch commercial is worried about getting news.

It's true.

I can't think of any.

A ton of TV ads, a medium that transforms and heightens this rivalry.

The increased exposure really allows Pepsi and Coke to insinuate themselves into the very fabric of American experience and leisure.

I mean, cola is there when you go to the movies.

It's there when you're at the beach.

It's what you drink at the holidays.

It's what Santa Claus drinks.

Let's all go to the lobby.

You know, the companies also settle more into their identities.

Coca-Cola wedding itself to the kind of American iconography that feels idealized and timeless.

Pepsi striving to define itself as the the new and different choice of younger people, the future.

Their big win on the youth front is from a 1963 campaign about the so-called Pepsi generation.

This is an idea that came out of a slogan contest won by a woman in Wisconsin.

Her prize was a car, so congrats to her.

Should have given her more, but that's how they get slogans.

They get some lady to come up with it and then never, you know, pay her royalties.

It's great.

Pepsi's play here was to maintain that it is actually different from Coke, a cool alternative,

preferred by a cool alternative crowd.

Commercials were showing attractive young people riding motorcycles and surfing.

They call Pepsi drinkers livelier, active people with a young view of things.

Nice.

Yeah, it implies being

kind of exciting and edgy without committing to any kind of idea ever, which is ideal, I'm sure, for marketing.

Yeah, they kind of had their cake and ate it too here because they were appropriating sort of a burgeoning counterculture, but without, you know, getting specific.

And they're selling a lifestyle as opposed to a beverage, right?

Yeah.

They, in 1965, acquire Frito-Lay or merge with them, expanding into the snack market.

And then that's on their way to buying Pizza Hut, Taco Bell, and KFC, which is, you know, where you're still going to get Pepsi products to this day.

That's very and Sierra missed, R.I.P.

Coke was also changing with the times, though kind of more behind the scenes.

Of course, by now they've realized that they have to compete for their share of black customers.

Robert Woodruff is no longer president of the company, but kind of steered it from the board of directors for decades.

He seemed to understand where the civil rights movement was taking the country.

Interesting anecdote is that Martin Luther King Jr.

had won the Nobel Peace Prize in 1964 and was said to be honored at a huge banquet dinner in his hometown of Atlanta the following year.

Certain business and political leaders, who you can probably imagine, were against King

and his politics, threatening not to take part.

The story goes that Woodruff put the word out that he supported the banquet and would be attending even if no one else did.

And the rest of town fell in line because that's how powerful he was at this point.

Supposedly, Woodruff didn't want Atlanta and by extension Coca-Cola embarrassed by a snubbing of a civil rights hero.

So again, it's yeah, it's a strategy.

Yes, yes.

I don't think he gives a shit about

people's rights.

Right.

Well, and it's like when you look today at sort of, you know, the way corporations are tweeting at each other and it's, yeah, you know, Wendy's is beefing with Burger King.

It's like, you know,

they're never going to be people.

So Coke has...

figured out a couple things.

They're slow learners, but they do know how to survive.

And, you know, he is basically like the most powerful person in Atlanta.

I mean, he, he, Woodruff is out the White House the night King is assassinated in 68 and actually learns of his death directly from LBJ,

then immediately calls his people down in Atlanta to make sure nothing goes wrong with the public memorial.

And he personally paid for funeral expenses the city couldn't cover, sent the Coca-Cola Company jet to bring Coretta Scott King back to Atlanta for the funeral.

And it does have, again, you know, to be a little cynical about it, it is all these like, he's paying a lot of attention to these appearances.

Let's say that.

I don't know.

To build on the previous point, you can never train a corporation to have morals, but you can train them to know they're being observed.

And maybe that's the best we can do.

Very true.

The war on drugs is taking shape.

There's a U.S.

agency called the Federal Bureau of Narcotics, predecessor of the DEA.

It's actively working to eradicate coca crops in Central and South America to stifle cocaine production.

Of course, despite the cultural significance of the plant in these regions.

Right, yeah.

Coca-Cola is worried they won't be able to get their leaves from Peru to be decoced by their chemical firm in New Jersey, but they're so powerful they can go straight to the FBN and say, hey, we'd like to set up a secret coca farm in Hawaii.

What?

The feds are like, sure thing.

And they even negotiate with the Peruvian government to make sure that supply channel remains open as well.

All for an ingredient they don't need.

Alrighty.

But that's what makes it fun when you think about it.

getting the government to bend the law so you can do something that you don't need to be doing

plus you know the name is still coca-cola so i guess they just have to stick with it yeah so that i don't know that is an incredible expression of what a big superpower they are you know because it's like who else could have done that in the 80s.

It's kind of hard to imagine.

Reagan, maybe a bit.

Well, this was just in the 60s.

I mean, they saw the writing on the wall.

Oh, my gosh.

Yeah.

They're like, yeah, okay.

So this is an area where they are quick on the uptake.

Yeah.

They saw that this is about to happen.

Yeah.

These crackdowns.

Speaking of addictive substances, so a final novelty of the 1960s soda scene.

Curiously, it was a third company, RC Cola.

Shout out to them.

Beat Coke and Pepsi to the Diet Soda fab.

Good job, RC.

Also, Tab.

Tab was around way before Diet Coke, right?

So Tab is a Coke product.

What?

Oh, my God.

Okay, so pepsia responds to rc cola 1963 with a line of diet drinks called patio there's a bunch of different flavors uh this actually gets a subplot on season three of mad men if uh people remember that patio it's a good name i like it patio diet cola is soon just diet pepsi coca-cola is very uptight about using the name on anything but the flagship product so they come out with the diet cola tab at the same time oh okay and the commercials have the commercials have to specify this is made by Coca-Cola, so you can trust it.

But

they refuse to put the name on there.

Fascinating.

Yeah.

Can I just tell you,

I have a personal favorite tab commercial.

Oh, please.

It's so good.

It's like shot in like Stepford wives fiction, and it's got this very eerie jingle.

And basically, it's about...

drinking tab so you can be a mind sticker.

Stick on your husband's mind when you're not around so he doesn't forget you and have an affair.

Be a mind sticker.

Drink tab.

Keep your shape in shape.

Your husband will forget you.

Good night, ladies.

It's the commercial.

That is dark.

Yeah.

It's rough.

I don't know.

I guess it's kind of silly for my mind to be this blown, but I really had been under the impression.

Why had I thought tab was somehow independent and why do I care?

It just goes to show the whole theme.

Just an upstart soda company that came out of nowhere.

It's an independent.

Yeah.

Oh, God.

I mean, it's funny because while there are obviously ads that focus on the diet culture aspect of this, the Diet Pepsi commercials kind of take aim at Tab for supposedly having this like gross aftertaste because of the saccharine that's in it.

Well, yeah, it did.

So they were like really laser focused on how Diet Pepsi tastes just like real cola.

And there's a very unsubtle subtext of like, FYI, the other Diet Cola tastes like shit.

Well, you know, I mean, if it's true, you might as well point it out.

Yeah.

Well, that's an interesting segue to 1971.

Oh, Don Draper,

which brings a master stroke from Coke, a worldwide commercial spot known as the Hilltop ad, which some consider the greatest commercial ever made.

And yes, to spoil the serious finale of Mad Men, the ad that Don Draper is implied to have written.

You could argue that it takes the Pepsi generation concept and levels it up to a kind of utopian mindset.

You get a multicultural group of young people on top of the hill holding cokes labeled in all different languages, singing, I'd like to teach the world to sing in perfect harmony.

I'd like to buy the world a Coke and keep it company.

It's the real thing.

Coke is what the world wants today.

Coca-Cola.

It's so good.

Like, it's so sinister.

I think it's quite evil.

But, like, I have goosebumps thinking about that ad.

I really do think it's fantastic.

For some reason, this cost the equivalent of $1.9 $1.9 million to make.

How expensive were those kids?

It became the most expensive commercial ever produced at that point.

But, you know, I guess if we're considering the upheavals of the late 60s, best during trauma of Vietnam, you can see how this sunny take on globalization, American greatness exported seamlessly to non-Americans who embrace it might have been comforting.

Yeah, well, and also it's, I think I remember, you know, because it like zooms out and it's this sort of like United Colors of Benetton thing of like multicultural, multicultural, everyone brought together by Coke.

But the first face it's on is a young blonde white woman, right?

So like,

yeah, like keeping its core focus.

Still very prominently,

you know,

a lot of white people leading the leading the charge, I guess you could say.

But it still wasn't everywhere.

So this is where we have to introduce Donald Kendall.

He's a Pepsi boss, one of the chief architects of the Cola Wars.

pure a company man as you'll ever find.

He drank Pepsi for breakfast.

Did he ever do the hot Pepsi like Laverne?

I have no doubt.

I mean, yeah, you got to try it at least if you believe so much.

He had no college degree.

He worked his way up from a job at a bottling plant to become president and CEO in the early 60s.

Before that, however, Kendall struck up a friendship with one Richard Nixon.

Okay.

And had formerly represented Pepsi in his legal career.

What?

Okay.

Love it.

That is, that is a very Nixon thing to do, honestly.

Here He loves soda.

That's my Nixon.

Exactly.

The two of them traveled together to Moscow in 1959 when Nixon was vice president

for an exhibition of American products.

Kendall wanted to beat Coke to the Soviet Union.

Can we do an operetta about this, this trip?

This is when he had

the kitchen debate with Khrushchev.

But when that wasn't happening, Kendall wanted Nixon to guide Khrushchev to the Pepsi display at the exhibition, where Khrushchev sampled the drink.

Khrushchev tried it and deemed it, quote, very refreshing.

The New York Times ran a headline I just love that said, Cola captivates Soviet leaders.

Incredible.

Kendall wouldn't be able to set up Pepsi operations behind the Iron Curtain until 1973, but it was the first American consumer product made and advertised in the country.

Good going, Pepsi.

It gets weirder because to get around the currency exchange issues over the next two decades, Pepsi continued to strike barter deals through third parties, accepting payments from the USSR in the form of stolytonaya vodka, as well as Russian submarines and warships that could be harvested for scrap.

And Kundal would later tell an advisor of President George H.W.

Bush that we are disarming the Soviet Union faster than you are.

Nice.

I mean, it does seem like they're getting some of their junk, but

yeah,

never get paid in vodka and warships, you know, what have I done wrong?

Why don't you have a navy?

I don't know.

Kendall unfortunately also connects Nixon with a Chilean Pepsi bottling magnate who was seeking to oust President Salvador Allende in the early 70s, which may or may not have influenced the president as he helped to set the stage for a coup in Chile.

Okay.

Wow.

On the flip side.

Kendall was also the guy who convinced Nixon to install a tape recording system in the Oval Office so he could refer back to audio transcripts when later writing his memoirs?

Kendall!

So we have him to thank for the Watergate tapes.

Incredible character.

That's amazing.

Is it true also the thing of like, because the way I remember it is that there was supposed to be like a button that Nixon could press to start recording, but he just like couldn't master it.

And finally, they were just like, okay, fine.

We'll just have it record everything.

I think we got everything.

In fact, Kendall is on the Watergate tapes because at some point he shows up and gives Nixon advice about what to do.

Perfect.

And then they have a nice soda, I hope.

Yeah, yeah.

Back on the U.S.

soda market, Kendall is responsible for a memorable, though pretty cynical, Pepsi pitch in the mid-1970s known as the Pepsi Challenge.

Oh, no.

The idea here was to stage blind taste tests of Coke and Pepsi in malls and stores to demonstrate that when people don't see the branding, they actually prefer Pepsi.

I feel like this might have backfired.

You know, there are a lot of theories about how Pepsi gained an edge in this comparison that the obvious truth is that when people do see the labels they pick the brand they have already aligned themselves with that's always been coke's advantage they're the default name but other things that could have swayed customers included whether the sodas were served at different temperatures a natural bias toward sweeter tastes served in smaller doses and how the cups were labeled it wasn't a scientific study by any means i mean the participants preferred pepsi by a really slim margin anyway to prove much The idea was just to make you question your own buying habits, right?

The idea was just to make us question reality.

Yeah.

I mean, toward the end of the 70s, Coke answered Pepsi's victory in Soviet Union by breaking into China first.

Ha ha.

They are the first foreign corporation allowed in almost three decades after the Communist Revolution.

Anti-American propaganda within the country tended to regard Coke as a prime symbol of capitalist empire and waste, and Communist Party media pretty sharply criticized coca-colonization but coca-cola chairman j paul austin was not going to let pepsi win this time and he constantly lobbied chinese diplomats in washington he would bring them boxes of cokes and then gave them a refrigerator when he realized that they were drinking it at room temperature

oh yeah it's not going to make a great impression yeah it just doesn't it's it doesn't hit But they're impressed by Coke's factories, their technology, their quality assurance.

I mean, this has been the model for a lot of the company's international franchising.

They give away cutting-edge infrastructure.

They let foreign partners run the plants, and they just import the secret syrup.

That's it.

Wow.

Yeah, it is fascinating that they managed to have that much syrup leverage.

So let's come back to the United States for the 1980s.

Oh, boy.

The fiercest years of the Cola Wars.

The years which drive Billy Joel to madness, apparently.

Yeah.

From here through the late 90s, Coca-Cola is helmed by a guy guy named Roberto Goizueta, whose family defected from Cuba when Castro rose to power.

Like Kendall at Pepsi, he's someone who rose fast in the organization at a really young age.

He was such a maniacal arch capitalist that I could spend 20 minutes just reading you insane quotes from him.

Wonderful.

He takes over in 1980 and instantly decides the company has no direction.

Rudderless.

It's a disaster.

It's gradually been losing market share to Pepsi in stores and is barely holding on to the the top spot thanks to distribution in restaurants and the like.

Goizueta talks a big game about Coke not competing with Pepsi, but with coffee, tea, milk, water,

saying stuff like,

saying stuff like, what's our share of the stomach?

His goals were, quote, a Coke within arm's reach of everyone on the planet

and quote, to make it impossible for the consumer to escape the Coca-Cola company.

I mean, he sounds like a Bond villain.

It's just

an incredible guy.

It's like, yeah, if you, I don't know, if you need a level of dominance where you want people to be unable to escape, it's like,

but why?

Asked if he ever drank Pepsi, he said, only when I've eaten something I don't like and I want to throw up.

Okay.

Love it.

Love the commitment.

Most importantly, though, he believed in action and change.

He said, don't wrap the flag of Coca-Cola around you to prevent change from taking place.

It is extremely important that you show some insensitivity to your past in order to show the proper respect for the future.

And I thought Hannah Arendt said that, but what do I know?

Wow.

It is like, I don't know.

I love the sort of the like the corporate intensity.

Like, it does feel like much like war corporations exist so men can feel like they're doing something important by destroying each other.

It's very interesting.

All right.

Well, great.

This is very dramatic.

In 82,

he takes the extraordinary step of putting the brand name on what is essentially a reformulated version of Tab.

This is the Diet Coke juggernaut we know and love.

Nice.

They buy the film company Columbia Pictures because the Reagan years are an insane frenzy of mergers and acquisitions.

And the company wants to see Coke products and movies that are then shown at theaters that sell Coke.

That seems like a good idea at the time.

There are, they're right.

There was a bump in Coke products and movies in the 80s, I feel like, now that you're saying that to me.

They sell it at a profit to Sony by the end of the decade because they realize they have no business in the film game.

Goizueta also swaps out the sugar and Coke for corn syrup to save on costs.

Oh, wow.

RIP to the to the good Coke.

Both Coke and Pepsi unveil caffeine-free versions, which would have pleased the Puritans who were making a stink about it at the beginning of the century.

Pepsi Co.

gets its own new hungry CEO in 1983.

This is Roger Enrico, whose original job at the company was in the marketing department for funions.

He climbed fast.

Enrico aggressively signs celebrities to endorse and advertise Pepsi, including Madonna, Michael J.

Fox, Lionel Ritchie, and the biggest of all, Michael Jackson, who inks a record-breaking $5 million deal.

Famously, Jackson's hair caught fire while he was filming a Pepsi spot in 1984.

We all know that.

Yeah.

The brand having these stars on their side only contributes to the ongoing sense of Pepsi being young and hip compared to their dusty old rival.

And on top of that, they're running these amusingly mean commercials that dunk on Coke in unexpected ways.

There's one where a UFO hovers over Coke and Pepsi vending machines and then uses its tractor beam on the Pepsi machine.

There's another where archaeologists in the future find a Coke bottle and don't know what it is.

It is like kind of clever.

Pepsi embrace bitterness at a certain point.

Yeah, yeah.

I think you have to, right?

Yeah.

The upshot is that by 1985, Pepsi is clawing its way to a 30% market share.

This is just unprecedented.

Diet Diet Coke is also somewhat cannibalizing the sales of original Coke.

So the company knows it's time for a big swing.

You might know what's coming here.

Sergio Zimon, a marketing executive at the company who had previously worked at Pepsi and spearheaded the success of Diet Coke, advanced the idea that Coca-Cola's secret formula should be changed again.

Oh, God, yeah.

Then you can call it new Coke.

Yep.

and push an advertising blitz for this revamp flavor, which would be noticeably sweeter, more like like Pepsi.

It is a great example, I think, of how you shouldn't try and compete by doing the thing your competitor is doing, which just so happens to be the opposite of the thing that you have always done.

It makes sense if you consider Coke's insecurity about being a lumbering dinosaur in the industry.

But I think as any consumer alive right now is aware, New Coke did not survive.

It's like that, yeah, the one thing we know about it is that it didn't make it.

And I don't, right, but it's like this idea of Coke, you know, for better and for worse, and in benign ways and in quite, you know, evil ways, building itself year by year as like the establishment drink, the drink of nostalgia and childhood and idyllic white families.

And then, you know, to just kind of like panic and dick shit, you know.

As soon as new Coke comes out, customers revolt.

Yeah.

I would.

I mean, it would be one thing if they could still buy original Coca-Cola, but they couldn't.

It's just New Coke.

They went all in, all in.

Yeah.

And it seems like they've made fairly conservative choices until now.

Like they wait to get into, you know, very to change.

They kind of wait stuff out.

And in this case, it's like, you couldn't have thought this over a little bit.

Well, as you were sort of describing, I mean, they're a victim of their own manufactured nostalgia.

Once you take away real Coke, suddenly that's all anyone wants because you can't have it anymore.

Yeah.

It's the real thing.

You don't, you don't have people embracing New Coke or Pepsi, really.

You just have customers forming organizations called like Old Cola Drinkers of America and signing petitions demanding Coke bring back the original formula.

Yeah.

And this is all despite Coke's own internal research, which indicated that people did prefer New Coke.

It's this encapsulation of our loyalty to an emotion as opposed to a product.

Nobody cares what the product is.

Yeah.

Is it better or does that matter?

Like, how much better can it be versus the comfort you get from it tasting the same as it has tasted since you were born?

So Pepsi and Roger and Rico see this blunder as their moment of triumph.

This guy is so delightfully petty that after the failed rollout of New Coke, he buys a full-page ad in major U.S.

papers that says, quote, after 87 years of going at it eyeball to eyeball, the other guy just blinked.

Wow.

That goes so hard.

Yeah, these guys are like freaking Carnegie.

This is great.

I mean, three months later, Coca-Cola puts regular Coke back on the shelves under the name Coca-Cola Classic.

Uh-huh.

This proved so popular that there are conspiracy theories to this day about the company deliberately sabotaging itself with new Coke just to make people clamor for the Coke that had been taken away.

They quickly regained their market share.

Pepsi remains the number two beverage company.

And as of this year, actually, Dr.

Pepper has edged out Pepsi and sales volume.

What?

This is because of Mormons.

Yeah, apparently, by connecting with Gen Z

who like a spicier soda.

Fair enough.

Surprisingly, Coke did keep trying to sell new Coke after rebranding it as Coke 2,

which feels even sillier.

It does.

It's like the first Coke is a family pet that died.

You can imagine their scientists being like, finally, Coke 2.

We've cracked it.

You know, Crystal Pepsi only ran from like 1992 to 1994 and yet occupies like a large part of my memory for some reason.

Right.

Well, it had that Van Halen song in the commercial, right?

That was, you know, can't do better than that.

Some of the stunts of the 80s and 90s were truly absurd.

Coke and Pepsi competed to be the first soda into space.

Okay.

Who won and how?

Or did anybody?

I don't think there were any winners here.

Coca-Cola invented a special dispenser can for zero gravity first, but Pepsi contacted the White House and demanded the chance to hardly develop their own gadget.

Eventually, both cans went up on a Challenger mission in 1985.

Oh, no.

Yeah, that one didn't go well.

Coke in 1990 has another really hairbrained scheme with a multi-million dollar promotion called the Magic Can.

This is part of a tie-in with a New Kids on the Block concert tour that summer.

Oh, boy.

The gimmick here is that certain cans of Coke, instead of soda, contain cash or vouchers for other prizes that would jump out from a spring-loaded device when you pop the tab.

Now, to make it impossible to tell which cans were winners just by picking them up, the company partially fills them with gross-smelling chlorinated water,

which was also meant to keep you from drinking out of a prize can once it was open.

For once, they're overestimating the intelligence of the American public.

And also, I hope nobody opened one of these while driving.

If this is sounding like a very

your scientists were so preoccupied with whether or not they could, they didn't stop to think if they should type moment, like that's right on the money.

I mean,

stores report that customers are shaking up cans, trying to determine which ones have prizes.

The packaging was faulty and it leaked.

So sometimes the money or tickets would get soaked in the chlorine water.

A little boy did end up going to the hospital after drinking some of the chlorinated water.

He was fine.

He was fine.

Thank God.

Cook scrapped the campaign.

They scrapped it in three weeks, but the company can't recall the magic cans that are already on sale because thanks to the ingenious design, there's no way of telling them apart from the regular cans.

They've become too big to, I guess too big to fail is a more specific, you know, it means too big for the government to allow them to fail or else we'll all die.

But in this case, they're just like too successful to tell good and bad ideas apart, maybe at this point.

Pepsi faced an even more insane disaster in the early 90s.

Its manufacturer in the Philippines held a contest called Number Fever in which the underside of bottle caps were printed with a three-digit number and confirmation code that corresponded to different prizes, including a grand prize equivalent to about 40 grand in US dollars.

Importantly, that's like hundreds of times the average monthly salary in the country.

Winning numbers were announced nightly on the news, and the promotion is so popular that Pepsi extends it.

One night, a news channel announces that the number 349 is the grand prize winner.

They were supposed to be just two winners, but because the contest had been extended, there were already 800,000 bottle caps in circulation with that number, without the confirmation code.

Yeah.

Paying out that many grand prizes would have cost around $32 billion.

God.

Thousands of customers in the Philippines try to redeem their caps.

Pepsi initially points out that they don't have the confirmation code.

Then they try to buy these people off for $20 a piece.

Some customers take this deal, but others form a consumer group and start holding protest rallies that sometimes turn into riots.

People are tipping over Pepsi trucks and setting them on fire.

Jesus.

Executives receive death threats.

Three employees are killed when someone throws a grenade into a warehouse.

A couple more people die when a homemade bomb is thrown at a Pepsi truck.

One of the men accused of orchestrating the bombings will go on to claim that Pepsi paid him to stage them as false flag attacks so they could smear the protesters as terrorists.

The fraud suits about number fever would take another 15 years to fully settle, with a number of plaintiffs finally receiving a few hundred dollars.

But it only took about a year for Pepsi to recover the market share it lost in the country during the scandal.

Man.

That is like, I don't know.

Yeah, it feels like these are the years when the consequences of the supremacy start coming back maybe, where it's like, right, like you are sort of this like God-size power if you're promising people money and then not giving it to them.

And it's sort of, I don't know, it's hard to blame people for

wanting to take Pepsi down and not thinking through the consequences.

Around the turn of the millennium, Coke and Pepsi continue to expand their product lines to keep pace with one another.

You may remember Coke selling Surge to challenge Pepsi's Mountain Dew.

Some people still hoping that'll come back.

The tie-ins get more and more expensive.

Pepsi is the official beverage of the Star Wars prequels.

In 2001, Coca-Cola faces a lawsuit from a Colombian trade union seeking $500 million in compensation for the deaths of three members, claiming that a Coke bottling partner in the country assisted right-wing militaries in murdering them.

Colombia, because of its never-ending civil war, is one of the most dangerous places for union activism.

Coke and the bottlers eventually get the complaints dismissed, but if you've ever heard offhand comments about quote-unquote Coca-Cola death squads, they're referring to this controversy.

Coke continues to deny the allegations through the odds, but it's just one more example of how these corporate behemoth myths wind up embroiled in every kind of geopolitical conflict thanks to their kind of imperial ambitions.

Right.

Right.

And if you're expanding aggressively into international markets and trying to maintain a foothold, then like at a certain point, you do,

I think, have to commit the same kind of crimes as governments do, just in order to keep your place.

Not that it's justified, but that that's how people justify it.

Now, throughout the

rest of the 21st century so far, I can't help but feel that some of the fight goes out of the Cola Giants in this era.

I think that some of it is because outside of the Super Bowl, we don't really experience the TV ad monoculture once did.

That's true.

But because of the escalation of their battle in previous decades, Pepsi and Coke are just stuck burning ungodly amounts of money to remain in the public eye.

This is like the paradox of being a product that's everywhere and that everyone already knows about.

You have to continually reinforce your omnipresence.

Yeah.

I mean, Pepsi and Coke both now spend around $4 billion a year on advertising.

That's amazing.

I mean, and that does, I don't know, that goes back to the arms race comparison because I feel like, like, what if Coke just decided to stop advertising completely?

Wouldn't they be fine?

I mean, not really, but, you know, but they would, though.

We wouldn't forget about them, you know.

I they can't take that chance, Sarah.

No, they can't.

They can't.

They can't.

What am I saying?

And, you know, sometimes the efforts to remain a part of the conversation backfire enormously.

You mentioned the Kendall Jenner ad.

So this was, this was interestingly like Pepsi kind of going for like a Coke style message.

Yeah.

You know, the spot features of what vaguely resembles a Black Lives Matter protest, of course, with all the slogans kind of downgraded to being generic.

Facing off against the cops.

Yeah, but it's like the timing is sort of, yeah, the implication is there.

They're like, oh, we're here and, you know, we have signs.

We are young.

I'm surprised there wasn't a sign that just said sign on it.

Yeah.

And the tension is diffused when Kendall Jenner, of all people, hands an officer a can of Pepsi and the whole scene turns into a celebration.

of soda and togetherness.

And you're just like, what were you going for, you guys?

So the social media outrage was so intense that Pepsi pulls that commercial after a day.

Incredible.

Faster than the like a prayer ad.

But I guess to sort of wrap up, I mean, the question that inspired this episode was,

why was I not only a Coke drinker, but in some way committed to Coke over Pepsi?

Right.

Can be answered in part by its relative success.

I mean, maybe without consciously choosing, I wanted to back a winner.

And maybe Pepsi drinkers want to root for an underdog.

If we ever find any of them, we'll know.

We can't really uncouple our cola desires from the fact that they've been locked in combat for more than a century.

Yeah.

It's possible that neither would have prospered at this level without the other company kind of driving it to, you know, even greater extremes.

I mean, personally, I have to conclude that while the cola wars may have sold oceans of soda, they were more about the frenemies you made along the way.

Aw, that's nice.

It is fascinating, isn't it?

It's like tracking the

expansion of Christianity.

Files, what a romp.

You're gonna go get a Coke at some point, but until then, like, what are you up to and where should people find more of your weird, wild stuff?

Yeah, my byline is over at Rolling Stone, where I'm a staff writer.

You can also find me on Twitter, for the time being, I guess, at you wouldn't post of my terrible joke framing like the you wouldn't download a car.

Nice.

And I'm just on my own name at Blue Sky.

Yeah, you know, I'm just shit posting around so you'll see me thanks for just having a great brain and using it around town i really appreciate it well thank you for having me

and that was our show we have learned so much Thank you so much for being with us through this year.

Thank you for your patience as we get back to you.

And

I promise we won't ever leave you alone for so long again.

Thank you to Miles Cleave.

Please check out his work over at Rolling Stone.

Thank you to Corinne Ruff for editing.

And thank you to Carolyn Kendrick for editing and producing.

You can check out her new album, Eech Machine, over at Bang Camp.

She's got a song about the devil out.

You're gonna like it.

We will see you in two weeks.