Pepsi Doesn’t Think the Bowl’s So Super

Pepsi has spent enough money over the years on Super Bowl ads to buy its own pro football team.  According to this article, about $20 million a year is what they had been paying to have a prominent place on the biggest broadcast of the year.

But that’s all coming to an end.  Instead, they’re wadding the $20,ooo,ooo into a big money ball and hurling it at social media.

To be more precise (and really, it would be hard to be less precise than what I just said), here’s what they’re doing:

“…the Pepsi Refresh Project is about getting the global community to nominate projects that need funding in local communities, you upload your video / project profile, gather as many votes as you can by spaming the social sphere and the top projects will win funding from $5k multiple times per month up to $250k a few times every month. “

On its face, this isn’t a bad idea, and who could bash an attempt to give away what would previously have been advertising dollars to worthwhile community projects?  Certainly not me.

Let’s talk about the Super Bowl.  For most companies, Super Bowl ads are a turbo money-suck.  You could spend years putting yourself in a position to raise millions of dollars from investors for your little company and spend it in 30 seconds.  Your message, however much you craft it, would disappear under the water without even kicking up much wake.

Pepsi, by contrast, makes an investment that, given its scale, isn’t huge, except that they burn it all in 4 hours. Still, after years of doing this, they might just have made an impact with those ads.  People kind of expect them to unveil something at the Super Bowl, and since their business is extremely mature, all advertising can really do is keep them healthy vis a vis competitors, and only that if it’s done with a lot of discipline and really well.

So maybe Super Bowl ads are the biggest tax on marketer stupidity in history, whether you’re Pepsi or Pets.com.

But is this program better?

Maybe.

Here’s how this kind of thing works.

One medium (say, TV commercials) gradually stops working.  People who have a vested interest in that deny it for a long time, but eventually, it becomes too obvious to ignore.  In the meantime, something else has developed.  It’s small and easy to ridicule, but if you pay attention, something’s really happening.

Soon thereafter, somebody (or many somebodies) become successful with this new thing (say, campaigns using social media to give away money to community projects) and little by little, others come pouring in to participate.

And in a business environment that’s super competitive and where most stuff is “soft” technology (like websites and software) versus “hard” technology (like iron smelting plants), things can change fast.  Money can migrate incredibly rapidly.

And pretty soon there’s too much money moving into the new thing.  It loses its effectiveness because it’s being done to death.

So it goes from being novel to being in decline very rapidly.

Note here that it’s not social media itself that would decline.  That’s doing just fine, just like the Internet and e-commerce never suffered during the “dot bomb” of the early 2000s.  Just the value of advertising and valuations of start-ups.

So here’s to Pepsi’s experiment.  It’s fair to say that it can hardly do less for them than the Super Bowl ads it might have otherwise bought would do.

So that’s something.