PEPSI COLA - social change in a US economic system

PEPSICO-social change in a US economic system

Walter Mack was appointed company chairman in 1950, and a former Coca-Cola vice-president of sales, Alfred N. Steele, took over as president and chief executive officer, bringing 15 other Coke executives with him. Steele continued the policy of management decentralization by giving broader powers to regional vice-presidents, and he placed Herbert Barnet in charge of Pepsi's financial operations. By the time Alfred Steele married movie star Joan Crawford in 1954, a transformation of the company was well underway. Crawford's adopted daughter, Christina, noted in her best-seller Mommie Dearest: '[Steele had] driven Pepsi into national prominence and distribution, second only to his former employer, Coca-Cola. Pepsi was giving Coke a run for its money in every nook and hamlet of America. Al Steele welded a national network of bottlers together, standardized the syrup formula ..., brought the distinctive logo into mass consciousness, and was on the brink of going international.' In fact, Pepsi-Cola International Ltd. was formed shortly after Steele's marriage. (L. Gornstein 2000)

Joan Crawford became the personification of Pepsi's new and glamorous image. She invariably kept a bottle of Pepsi at hand during press conferences and mentioned the product at interviews and on talk shows; on occasion she even arranged for Pepsi trucks and vending machines to feature in background shots of her movies. The actress also worked hard to spread the Pepsi word overseas and accompanied her husband, now chairman of the board, on his 1957 tour of Europe and Africa, where bottling plants were being established.

Steele died suddenly of a heart attack in the spring of 1959. Herbert Barnet succeeded him as chairman and Joan Crawford was elected a board member. Pepsi-Cola profits had fallen to a postwar low of $1.3 million in 1950 when Steele joined the company, but with the proliferation of supermarkets during the decade and the developments in overseas business, profits reached $14.2 million in 1960. (J. Timothy et al. 2001)

1960s and 1970s: The Pepsi Generation, Diversification

By 1963, Kendall was presiding over the Pepsi empire. His rise to the top of the company was legendary. He had been an amateur boxing champion in his youth and joined the company as a roduction line worker in 1947 after a stint in the U.S. Navy. He was later promoted to syrup sales where it quickly became apparent that he was destined for higher office. Ever pugnacious, Kendall has been described as abrasive and ruthlessly ambitious; beleaguered Pepsi executives secretly referred to him as White Fang. Under his long reign, the company's fortunes skyrocketed.

Pepsi-Cola's remarkable successes in the 1960s and 1970s were the result of five distinct policies, all of which Kendall and his crew pursued diligently: advertising on a massive, unprecedented scale; introducing new brands of soft drinks; leading the industry in packaging innovations; expanding overseas; and, through acquisitions, diversifying their product line. ( J. Timothy 2001) The postwar baby-boomers were in their mid- to late teens by ...