THE POWER OF BRANDS
“Products are made in the factory, but brands are created in the
—Walter Landor, founder Landor Associates
“Brand equity is the sum of all the hearts and minds of every single
person that comes into contact with your company.”2
LARRY SMITH WAS A TWENTY-YEAR VETERAN OF PEPSI-COLA when he was transferred to Texas in 1975 to do something about the soft drink’s anemic market share in the Lone Star State. A native of South Carolina, Smith knew firsthand that Coke dominated the South, but Pepsi’s 6 percent share of soft drink purchases in Texas, compared to Coke’s 35 percent share, was embarrassing, especially since even Dr. Pepper had a 25 percent share.
Smith soon discovered he had his work cut out for him. The first Dallas supermarket chain he called on turned down what would have normally been a no-brainer promotional deal in which Pepsi proposed to pay the chain to stock its soft drinks and to sell it to them at a heavy discount in exchange for some retail advertising and end-of-aisle displays. “They said they didn’t need us,” Smith recalled later.3
When the advertising people back at Pepsi headquarters in Purchase, New York, refused to replace the Pepsi Generation campaign running in Dallas with something more product-specific that would “move the needle,” Smith took things into his own hands. He hired