Tuesday FOX announced that Pepsi would be the sole season-long sponsor of the highly anticipated Fall show, “X Factor.” Already a humongous hit in the UK, “X Factor” is a singing competition brought to the US by Simon Cowell, who is leaving “American Idol” this season to host the new show.
What makes this announcement such a coup for Pepsi is the fact that its “life-long” competitor, Coke, is already the sponsor of “Idol” (as fans of the show already know). With this new “X Factor” sponsorship, it seems that Pepsi is getting the last laugh, trumping its rival by partnering with the newer, and many might say cooler, program. The announcement marked what was an unquestionably sad day at Coke, which likely used its clout as Idol’s current sponsor – not to mention, heaps of cash – to get the “X-Factor” sponsorship.
When I read the announcement yesterday in the New York Times, I was catapulted back to my youth, when “The Pepsi Challenge” was all the rage. A brilliant piece of marketing on the company’s part, “The Pepsi Challenge” (for those of you who don’t remember, or weren’t even born yet) pitted the two brands against one another in a taste test. At malls, shopping centers and other public locations, a Pepsi representative set up a table with two blank cups: one containing Pepsi and one with Coca-Cola. Shoppers are encouraged to taste both colas, and then select which drink they prefer. Then the representative reveals the two bottles so the taster can see whether they preferred Coke or Pepsi. Whereas most people think that Coke is clearly the preferred brand, the results of the test leaned toward a consensus that Pepsi was preferred by more Americans.
Cut to 35 years later (yes, the Challenge was launched in 1975), with “X Factor” putting a new twist on the so-called cola wars. While Frank Cooper, a senior vice president at PepsiCo, rebuffed questions about the longstanding Cola Wars, he did say, “There is absolutely personal joy in getting the ‘X Factor’ property. I love it.” He then added, “But I love it mostly because of what we can do with it.”
It’s true, in today’s day and age, the possibilities are endless. Along with commercials, Pepsi and Fox will work together on marketing off the air and a joint Web site. Mr. Cooper said the social media and local community parts of the “Pepsi Refresh Project” — which lets people vote to give grants to deserving philanthropic organizations — would be used as a template for its promotions for “X Factor.”
At the end of the day, however, it’s clear that neither Coke nor Pepsi was the big winner in this scenario. That award goes to FOX, which now has Coca-Cola locked up on “Idol” in the winter and spring, and Pepsi on “X Factor” in the fall. Now that’s one foxy marketing coup.