PepsiCo's Social Media Crisis: Lessons Learned

This report discusses PepsiCo's social media crisis in 2017, where the company faced negative publicity due to a controversial advertisement campaign. The report analyzes the incident and draws lessons for organizations to avoid such crises. The importance of testing advertising campaigns before launching them in the market is emphasized.

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Network and social Media
Report
9/14/2018
Student Name

P a g e | 1Network and social Media
PepsiCo, Inc. is an American based multinational food, snack, and beverage corporation. The
headquarters of the company are located in the New York. The company has found interested
in the marketing, promoting its products and services in the market by using the campaigns
and another way in the market. PepsiCo has found to promote its products and service on the
social media in any of the different ways (Forbes, 2017). The company was found to be
unique in making the new campaigns in order to get the publicity in the market. However,
sometimes it may have the negative effect on the company and its image in the market. One
of the incidents has been discussed below which was related to the social media crisis which
Pepsi has to face in the market (Semrush, 2017).
In the year 2017, one of the biggest scandals has been identified in the global market. Pepsi
was found to defend in the global market with a message f unity, peace, and understanding.
The company was found as the defaulter in the market due to providing the wrong
advertisements in the market. The intention of Pepsi was to get the publicity in the market but
not have the belief to face the crisis on the social media. However, the interpretation of the
advertisement and campaign was made in the wrong way. For this, the company has to pay a
very high amount in the market in the form of loss of sale, a decrease of reputation in the
market and spoiled image in the social media (Semrush, 2017).
The scandal is nothing but the company has presented the advertisement in the market related
to its new campaign. Pepsi has presented a new advertisement campaign featuring the mega-
celebrity Kendall Jenner. In this campaign, Kendall Jenner through away the Pepsi can to the
camera staff and run away from there and join the protest, which is running on the protest.
This video got viral on youtube. In one day, the video got the 1.6 million views (Forbes,
2017). The most amazing event was recorded in the video. Kendall gives the can in the hands
of the police officer, who takes a sip and smiles to his partners (Rutsaert et al., 2013).
The video and campaign was most advertising in the market. Video get the publicity too in
youtube and other channels. The campaign and video being promoted in the social media
market get advertisement in the newspapers and youtube. This advertisement was given as
the best example of white and economic privilege. This was judged for trivializing
demonstrations and serious social issues. Several memes and jokes have viral related to the
Pepsi and Kendall acts over the social media. The social media crisis has begun. This affects
the market value of the company and its reputation too in the market (Qualman, 2010).

P a g e | 2Network and social Media
It was necessary to shut the communication channel in the market so that the information
must not be sent to a high level in the market. However, Company fails to do so as the
information and video get viral in the short period within 48 hours with a million views and
like on them. This spoils the image of the company, which hampers the growth potential of
the company. The tipping point in the case is only the video that gets viral through the social
media and gets fire in the mind of the individual. This little thing has made the great
distinction in the market (Fearn-Banks, 2016). The difference came in the market after the
video get viral will hamper the image of the company in the minds of the consumers. This
will be considered a tipping or turning point in the life of the company. a little things make a
big difference in the image and sales of the company. The company get affected not only in
the economic terms but also gets affected in the social market also. The historical image that
the company has managed during its initial years was spoiled in the market due to this small
incident (The PHA Group, 2014).
The company was trying to manage the crisis by introducing and indulging the new aspects
of the market. Pepsi Company has tried many different ways to improve the image of
company on social media sites but gets fails to do so. The company was targeted by the social
media. The company tries to manage the affairs of the company so that image can be
improved and an increase in the market. Not only the market image but also market value
should also be enhanced. This should be improved in the eyes of its stakeholders and
shareholders. After all this, Pepsi managed to delete the video from its official sites and on
the social media channels (Berthon, Pitt, Plangger and Shapiro, 2012).
The Pepsi made statements that the Pepsi was trying to project a global message of unity,
peace, and understanding, but fails to do so in this campaign. The company promised to do so
in the near future. At last, the company accepts that they have missed the campaign
objectives and ultimate goals and they are found guilty and apologize for the same. Company
conveys its message on the social media that “we did not intend to make light of any serious
issue. We are removing the content and material available on the social media and halting any
further rollout. We also feel guilty for putting the Kendall Jenner in this position (Forbes,
2015).”
It has been learned from the case that the Pepsi has to pay the high price for this small
incident. When the company is found struggling with the audience in the market, it has
faced such situation, which brought down its image too low in the market. The company

P a g e | 3Network and social Media
wants to attain the attention and attract the customer at large. Companies love to request the
social issues so that they can get the publicity in the market and product can be known in the
product. The large public can able to reach the product. The popular idea of making a buyer
and speaking to the spectators in their language is a good one but as we can see from this
incident, it is possible it can be a failure also. From the incident, it has been analyzed that this
will be the greatest failure due to the very small issue, which has taken a large span in the
social media market. The company wants to maintain the good image by speaking in the
language in which people understand their campaign but ends up with the failure only. The
social media, in this case, provoked a serious issue and made the crisis on a hike (PR week,
2017).
The company has tried to manage the affairs in the right way, as there is no other option is
left with the company. Deleting the video from the social media and apologizing for their
mistake is the right way to get resolved this topic from the minds of the consumer. Otherwise,
the company will have to pay a huge amount in resolving the issue from the minds of the
customer as other companies are bearing today also (Malthouse et al., 2013).
Therefore, from the above case, it has been analyzed that before launching a product
advertising campaign, first test the idea in a small area or market. From this, the analysis can
be made whether the campaign will be successful in the market or not. Choosing the small
target audience has its own advantages in the market as the cost and analysis involved in the
research will also be less rather than targeting the large audience at one time without knowing
and analyzing the result (Gensler, Völckner, Liu-Thompkins and Wiertz, 2013).
However, from the case of Pepsi, Pepsi has apologized for doing the mistake in the market
and on the social media. The company takes the responsibility for what company has done in
the market. From this, it can be concluded that the Pepsi care for their customers and target
area to whom they are targeting. Pepsi feels sorry for the misunderstanding and this was
appreciated by the social media, which works as the positive driver to improve the company
image in the market (PR week, 2017).
From the above discussion, it can be concluded that every organization should try to make the
campaigns, which are eligible and found relevant in nature. From the case of Pepsi, it has
been learned that the organization should deal with the problem on the valid basis. If they
have mistaken they should accept it on the social media so that everyone can know that they
are guilty and care for their customers and targeted market. This will make the negative

P a g e | 4Network and social Media
image of the company concerned into the positive image. Pepsi was found to be eligible in
accepting their mistakes and shown care towards its customers.
References
Berthon, P.R., Pitt, L.F., Plangger, K. and Shapiro, D. (2012) Marketing meets Web 2.0,
social media, and creative consumers: Implications for international marketing
strategy. Business horizons, 55(3), pp.261-271.
Fearn-Banks, K. (2016) Crisis communications: A casebook approach. Oxon: Routledge.
Forbes. (2015) Crisis PR – Top 10 Best and Worst [Online] Available from:
http://blog.rdpr.co.uk/the-best-and-worst-crisis-communications-case-studies [Accessed on:
14-09-2018]
Forbes. (2017) The Biggest PR Crises Of 2017 [Online] Available from:
https://www.forbes.com/sites/forbesagencycouncil/2017/05/23/the-biggest-pr-crises-of-
2017/#7e00fdef50a8 [Accessed on: 14-09-2018]
Gensler, S., Völckner, F., Liu-Thompkins, Y. and Wiertz, C. (2013) Managing brands in the
social media environment. Journal of interactive marketing, 27(4), pp.242-256.
Malthouse, E.C., Haenlein, M., Skiera, B., Wege, E. and Zhang, M. (2013) Managing
customer relationships in the social media era: Introducing the social CRM house. Journal of
Interactive Marketing, 27(4), pp.270-280.
PR week. (2017) Pepsi says sorry and removes Kendall Jenner ad from the Web [Online]
Available from: https://www.prweek.com/article/1429761/pepsi-says-sorry-removes-
kendall-jenner-ad-web [Accessed on: 14-09-2018]
Qualman, E. (2010) Socialnomics: How social media transforms the way we live and do
business. New Jersey: John Wiley & Sons.
Rutsaert, P., Regan, Á., Pieniak, Z., McConnon, Á., Moss, A., Wall, P. and Verbeke, W.
(2013) The use of social media in food risk and benefit communication. Trends in Food
Science & Technology, 30(1), pp.84-91.

P a g e | 5Network and social Media
Semrush. (2017) What We Can Learn From the Biggest Social Media Management
Nightmares of 2017 [Online] Available from: https://www.semrush.com/blog/three-biggest-
social-media-management-nightmares-2017/ [Accessed on: 14-09-2018]
The PHA Group. (2014) Top ten worst PR mistakes [Online] Available from:
https://thephagroup.com/insights/crisis-and-reputation-management-insights/top-ten-worst-
reputation-management-disasters/ [Accessed on: 14-09-2018]