Diet Coke outsells Pepsi for first time

Pepsi's marketing blunders allowed Diet Coke to move into the No. 2 spot last year.

By Kim Peterson Mar 17, 2011 1:29PM
Credit: (©Urbano Delvalle/ TIME & LIFE Images/Getty Images)
Caption: Can of Diet CokeDiet Coke outsold Pepsi for the first time last year, and now Diet Coke is the No. 2 soda in the country, The Wall Street Journal reports. The top-selling soda is still Coca-Cola.

Nabbing the first two spots is "a historic win" for Coca-Cola (KO), the Journal reports. And it says a lot about the ongoing problems Pepsi (PEP) faces in trying to drive business and maintain its market share.

It was pretty clear that Diet Coke was moving into the No. 2 spot even back in 2009. Pepsi had just a slight lead over Diet Coke back then, the Journal reports. Both brands had a little less than 10% market share, while regular Coke grabbed 17% of the market.

The issue here isn't so much what Coca-Cola did right but what Pepsi did wrong. Pepsi tried some interesting marketing strategies that simply didn't pay off.

Post continues after video:
Coca-Cola made sure its cups were front and center on "American Idol," for example, and tied in other promotions to the hit show. Pepsi missed out but is trying to catch up by advertising on "X Factor," which is a new music show from "American Idol" veteran Simon Cowell.

Last year, Pepsi skipped over some key marketing venues, including the Super Bowl, and instead put millions into an online charitable-giving program, the Journal reports. Very noble, but that did nothing for its sales. Pepsi says it was a long-term bet that ultimately will boost its image.

Pepsi has been revving up its marketing engine lately, however. It introduced a skinny can for Diet Pepsi, though the way it launched during Fashion Week drew some criticism. And this week Pepsi said it's testing a new bottle made entirely from plants.

But ultimately, the beverage competition is more important to Coca-Cola than to Pepsi. That's because Pepsi has broadened its business so much that it's pretty much a food company with a small soft-drink business on the side. Pepsi owns the Frito-Lay and Quaker Oats brands, and it's diversified its beverage business with Tropicana and Gatorade -- two brands that bring in more revenue than carbonated soda.

Coca-Cola, on the other hand, is very focused on its soda line, as well as its Minute Maid, Powerade and Dasani water.

Which company do investors side with? Pepsi shares have roller-coastered all over the place in the past year, falling to $63.17 from $66.50. But Coca-Cola shares have been on a steady march, rising to $62.46 from $55 a year ago. And Coca-Cola has the higher market cap, at $141 billion, compared with $99 billion for Pepsi.


19Comments
Mar 17, 2011 2:11PM
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Funny they never mentioned taste.  Yes, the follish might be influenced by advertising but for me taste is all that matters and not who contributed to whom.

Mar 17, 2011 2:02PM
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Well....yeah?!....Pepsi goes flat as soon as you open the can.  Diet Coke is the best.  Back in the day, it was Tab.  Now it is DIET COKE.  No brainer there.
Mar 17, 2011 2:15PM
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Coke or Diet Coke, when it is ice cold, it feels like heaven on the throat when thirsty!

Mar 17, 2011 2:03PM
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Diet Coke is better than Pepsi or Diet Pepsi, but DIet Dr Pepper is way better than any of them.  I pity you poor folks who live up north and can't get DDP anytime you like.
Mar 17, 2011 2:23PM
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too bad pepsa tastes like swill. maybe they could fix that problem.
Mar 17, 2011 2:03PM
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Perhaps it is just that Pepsi doesn't taste as good?
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I ran a vending machine company in Indiana for 20+ years, and remember when customers pushed for Pepsi in cup vending machines. Tasted OK, but, in less then 2-3 weeks you had to dump the syrup as it produced a blue-green mold on it. I remedied this after a while by finally dumping the syrup altogether and putting Coke syrup in as a replacement. Wasn't nice as far as I guess I lied to the customer, but I was told by "Pepsiholics" that what they were drinking was the best Pepsi they ever tasted. They never did find out it was good ole COCA-COLA.

 

Pepsi drinkers are ****es.

Mar 17, 2011 2:20PM
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Back when I worked in the High School Concession stand  #1 was Coke, #2 Mt Dew, #3 tied Diet Coke & Pepsi, #4 Sprite. We sold 5 Diet Cokes to 1 Diet Pepsi.
Mar 17, 2011 2:31PM
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Pepsi is FLAT.

Coke has the right amount of bubbles.

All there is to it.

Coke tastes bad flat too.

And have you noticed, Diet Coke has even more carbonation than regular Coke.

But, the only diet soda I can handle is Cherry Zero - otherwise you can keep them all.

(It's all about the bubbles!)

Mar 17, 2011 2:17PM
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Some people like Coke some like Pepsi it is depend on their preferences.But,Coke is definitely has better marketing. Almost all restaurant have Coke. How many restaurant offer Pepsi?
Mar 17, 2011 2:18PM
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I have always been a coke person. Who cares about #2. Coke made a mistake and changed BUT they lived up to being better. My money will be on Coke. Makes CENTS right.Thats what we all want.
Mar 23, 2011 9:45AM
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They don't get my dollars. In fact I would rather be thirsty that drink a Coke. Water is a step up for me. I don't like the taste at all. Unfortunately I live in Belgium now and Pepsi is rare, so I drink Belgium Beer instead. Three years from now it's back to Denver, and concerts at the Pepsi Center.
Jun 28, 2011 2:01PM
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As far as drinking a soda straight...I prefer Coke

but then again when I am out having a drink with friends at clubs I prefer pepsi as a mix with Captain Morgan spiced rum....NO LIME....Pepsi as a mixer keeps the rum creamy...Coke totally ruins it !

 

 

Mar 17, 2011 2:26PM
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Who can afford to buy coke or Pepsi?  I save a buck per 2 litter bottle by buying the generics.
Mar 17, 2011 2:35PM
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Sure wish the companies that produce diet drinks would STOP adding aspartame to their products. Read up on it....there are plenty other ways to substitute sugar.  So, to avoid the aspartame I drink the sweetened with "high fructose corn syrup" < another nasty fattening, "make people crave more sugar" additive.  The commercials on TV say high fructose corn syrup is "natural"..I BEG TO DIFFER..It has no place in a sweetened drink.  Regular RAW sugar cane could be used instead.... 

I hate to say it, but after reading all that I have on Aspartame--I will never drink a diet product that contains it!!!!!!!!!!!!!!!

Mar 17, 2011 2:46PM
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Pepsi taste like flat soda water and is definitely undrinkable. The only people that I know who like Pepsi do so because they were raised liking it and they are ignorant and don't know better. Their parents brought them up as the Pepsi "generation" and they themselves are senile.
Mar 17, 2011 2:36PM
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Pepsi is better for drinking plain and Coke is better for mixing with booze! 
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Coke tastes like syrup. It's terrible and leaves a bad aftertaste. I think that the majority of people that like it, do so, due to the mega advertising done by the company. The brainwashing done by Coke is overkill and they have pushed this sweet syrup on the world and made many kids hyper and overactive. If you did a blind taste test using Pepsi, Coke, and some good generic brands, you would miss the mark nearly every time. Most folks don't want to admit they have been a victim of years of advertising brainwash, but we all have, and the sweetwater sugar sodas are basically all alike. Yet, some fools insist on paying twice as much for Coke as they would for a generic. Dummies!
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