In the early 90s, the beverage company Coca-Cola were significantly outselling their arch rival, Pepsi-Cola. Official records stated that the former held a 75 percent market share compared Pepsi-Cola who were just hanging on by a meagre 17 percent.
In their endeavour to better their sales, Pepsi-Cola Philippines Inc. decided to introduce a marketing program known as “The Number Fever” in the year 1992. This program, although initially very successful, caused the Pepsi mistake Philippines later on that rocked the entire nation with a large number of riots and a great deal of loss in terms of human lives as well as damage to property.
The Number Fever – Pepsi-Colas inventive marketing plan
According to this marketing program, the caps of all the bottles of their drinks were to have 3-digit numbers imprinted along with amounts for cash prizes (ranging from 1000 pesos to 1 million pesos). When the promotion period ended, the winning number was to be announced, and the winner was to receive the grand prize of 1 million pesos.
The promotional plan worked to perfection as sales of the company’s products went up by a whopping 40 percent within the period of a few weeks. This initial success prompted the company to increase the number of prizes to a staggering 1500. During the entire promotional period, a total of 31 million people (more than half the population of the country at the time) took part in this program. This did help to increase the sales figures of the company to a great extent.
The announcement of the winner and the blunder
The company had to announce a winner at the end of the program, and once they did, all hell broke loose in The Philippines. It was initially announced that even though numerous people would go on to win small amounts in prizes (which would be imprinted beneath the caps), these amounts would not be dispersed by the company until the eventual winner was also declared.
Two months post the start of the campaign, the company announced the winning number to be “349”, and the winner was promised a payout of 1 million pesos in prize money.
This is where the Pepsi mistake Philippines started. Evidently, the Mexican consulting firm, D.G.Consultores, who were hired by the company to choose the winning number randomly, were the reason behind this blunder. They were supposedly provided with a list of numbers that should not have been considered when selecting the winning number, and “349” was one of those figures.
Consequently, Pepsi had ended up printing over 800,000 caps with the number, and the list was given to them to avoid the very situation that eventually manifest itself. Hence, a situation arose where thousands of people around the country came up with bottle caps that had the winning number and wanted to claim their prize.
The Aftermath – Numerous riots around the country
With so many people claiming the 1 million pesos prize, Pepsi tried to avoid the situation by arguing that the caps did not have the proper security code, and denied to disperse any prize money. This caused a substantial uproar in the country with riots everywhere.
According to the reports of Pepsi, at least 32 delivery trucks and over 40 company trucks were damaged by the public through stoning or fire, and a few of them were even overturned. Numerous Pepsi offices and production plants were bombed and destroyed all over the country. Several people even lost their lives in these riots.
Eventually, the company received 689 civil suit notices along with over 5,200 criminal complaints in regards to deception and fraud. The 2 million dollars budget that the company had initially set for the prize money rose to a staggering 10 million dollars in legal and restitution fees. It all turned out to be a pretty costly blunder on their behalf.
What happened eventually?
In the year 2006, 14 years after the incident, the Supreme Court of the Philippines issued a verdict which cleared Pepsi from all the criminal charges stating that there was “no proof of negligence on behalf of the company”, and that they were not to be held accountable for the riots. However, this did nothing to reduce the extent of damage that had already been done.