Pepsi challenge #marketing, a tactic which pits No.2 and against No.1, always succeeds if used properly – but many people don’t realize how.
Many might be surprised to find that Coke’s sales INCREASE when Pepsi does a taste test challenge, The growth in Pepsi’s sales and share comes from minor brands suffering and losing market share.
What the strategy does is send a strong message “There are only two brands worth considering”, the focus of consumers’ interest ensures trial and adoption from OUTSIDE the Coke franchise as well as reinforcing brand equity of the existing franchise – a double edged sword… only soured by the knowledge that it assists your major competitor too.
Coles & WW are using it, with a price war that couldn’t have been better organized if they had colluded to do it on purpose 😉
NOW Facebook and LinkedIn have adopted this strategy in a movement that is likely to hamper growth and undermine THEIR competitors.
While short-term benefits may offer a consumer advantage, the long term development of unconquerable oligopolies offer an inevitable industry wielding too much power and to the larger populations’ disadvantage.
Great if you’re a shareholder, of senior executive on a performance bonus… not so for the masses 😦