It took four decades for Pepsi to become a stable business. During that time, its various owners made three failed attempts to sell the brand to The Coca-Cola Company, and two of them went bankrupt. Since its launch in 1893, Pepsi has followed a remarkable journey to become one of the world’s strongest consumer brands.
A Drugstore Origin in North Carolina
The drink originated in 1893 in New Bern, North Carolina, where pharmacist Caleb Bradham (1867-1934) created a fountain beverage known as Brad’s Drink at his drugstore. In 1898, the drink was renamed Pepsi-Cola, combining the term “dyspepsia” (“upset stomach” in layman’s terms) with kola nut, a key ingredient. The product was initially sold exclusively through the drugstore’s soda fountain. As demand increased, Bradham established the Pepsi-Cola Company in 1902 to support larger-scale production. By 1905, Pepsi-Cola was being sold as a pre-mixed bottled soft drink, marking its transition into mass distribution.
Pepsi-Cola’s logo 1898-1903
Sugar Speculation and Bankruptcy
After World War I, global sugar prices rose sharply, driven by wartime shortages and disrupted trade. Bradham expected prices to continue increasing and committed the Pepsi-Cola Company to large forward purchases of sugar at historically high prices. In 1920–1921, sugar prices collapsed as production and international trade normalized. The company was left with sugar inventories purchased far above market value, resulting in severe financial losses. In 1923, the Pepsi-Cola Company filed for bankruptcy. Bradham lost control of the brand and subsequently returned to operating drugstores.
From Repeated Failure to Corporate Control
The Pepsi-Cola trademark and recipe were acquired by Craven Holding Corporation, which resumed production. Craven itself went bankrupt in 1931. At that time Pepsi-Cola had attracted the attention of Charles Guth, chief executive of Loft Inc., then the world’s largest candy manufacturer. Loft sold Coca-Cola through its chain of candy stores in New York and Newark. Dissatisfied with Coca-Cola’s syrup pricing and unable to renegotiate terms, Guth personally acquired the bankrupt Pepsi-Cola brand. He replaced Coca-Cola with Pepsi-Cola in Loft’s 115 candy stores. Loft shareholders later sued Guth, arguing that he had used his position for personal gain rather than offering the opportunity to Loft. In a landmark corporate governance case, Guth was forced to transfer Pepsi-Cola to Loft, which then rebranded as the Pepsi-Cola Company. Charles Guth later became involved in Noxie-Cola.
Logo 1906-1934
A Profitable Breakthrough
Although Guth is today best remembered for ethically questionable business practices, he was also one of the individuals most critical to Pepsi’s survival. After decades in which Pepsi had remained a marginal and unstable business, a decisive turning point emerged around 1935. Guth introduced 12-ounce bottles of Pepsi-Cola priced at five cents. At the time, Coca-Cola and most other soft drinks were sold in 6.5-ounce bottles at the same price. Sales increased sharply, profits doubled between 1936 and 1938, and Pepsi stock rose one-hundred-fold. Effectively giving away an extra 5.5 ounces per bottle proved decisive for Pepsi’s long-term survival.
PepsiCo and the Shift Beyond Cola
In 1965, Pepsi-Cola Company merged with Frito-Lay to form PepsiCo. The merger marked a structural shift from a soft drink company to a diversified food and beverage group. Today, PepsiCo owns a wide portfolio of packaged food and beverage brands, including 7 Up (in Europe), Mountain Dew, Doritos, Gatorade, Lay’s and Tropicana, as well as SodaStream and Rockstar Energy. Through subsidiaries, PepsiCo also controls major fast-food chains such as Pizza Hut, Taco Bell and KFC. While Pepsi remains the group’s largest single brand by sales, beverages account for only about half of PepsiCo’s total turnover, and carbonated soft drinks represent less than half of beverage sales.
Pepsi-Cola was rebranded as Pepsi in 1961. This logo was in use 1962-1969.
Changes in the Formula
The original 1893 formula developed by Caleb Bradham was revised several times. Bradham adjusted it when bottling began in 1905, and further changes were introduced in the 1930s under Charles Guth. Pepsi has also been produced with small, documented variations by market, including differences in sweeteners and minor changes in carbohydrate and sodium content.
In November 1984, PepsiCo announced that Pepsi produced in the United States would switch exclusively to high-fructose corn syrup, replacing corn sugar, a change mirrored by The Coca-Cola Company around the same time. From around 2020, Pepsi’s sugar content was reduced in several markets from about 10.7 g to 7.0 g per 100 ml, with sugar partly replaced by acesulfame K and sucralose.
After several very different logos in the 1990s and 2000s, Pepsi returned in 2023 to a visual identity based on the 1960s.
Diet, Max, Twist, Crystal, and Raw
PepsiCo has consistently experimented with new cola formulations and extensions. Early low-calorie variants include Diet Pepsi, marketed as Pepsi Light in some countries (since 1963, sweetened with aspartame). The brand’s most successful sugar-free line is Pepsi Zero Sugar, also known as Pepsi Max or Pepsi Black (since 1993, sweetened with acesulfame K and aspartame). Another long-running extension is Pepsi Twist (since 2001).
Other variants were produced for limited markets or short periods, such as Pepsi Ice Cucumber (Japan, 2007), Pepsi Salty Watermelon (Japan, 2012), Pepsi Raw (Europe, 2010), Pepsi Maple Cola (Canada (obviously), 2026), and the colorless Crystal Pepsi of the 1990s. Pepsi also jumped on the emerging craft soda trend with Caleb’s Kola (2014–2017, sweetened with sugar), a short-lived reference to the brand’s founder Caleb Bradham.
Pepsi Perfect
In the 1989 science fiction film Back to the Future Part II, the main characters Doc and Marty travel forward in time to October 21, 2015. While visiting a café in the future, Marty orders a “Pepsi Perfect,” a fictional, vitamin-enriched Pepsi variant served in a distinctive bottle with a built-in straw. The product existed only as a prop created for the film.
On the actual October 21, 2015, however, Pepsi introduced a limited-edition Pepsi Perfect that replicated the bottle shape and label design shown on screen. The release was limited to 6,500 bottles and was sold exclusively in the United States.
Marty McFly with a Pepsi Perfect in the movie Back to the Future Part II (1989)An actual ad for Pepsi Perfect (2015). The hoverboard plays a big role in the movie.
Forever Number Two in the Cola Wars
From the beginning of its national and later global expansion, Pepsi has existed in direct comparison with Coca-Cola. The rivalry between the two has lasted for decades, and on most markets Pepsi has consistently been the second-best-selling cola of the two. Notable exceptions include India, Pakistan, Saudi Arabia, Egypt, Peru, Guatemala, and large parts of Canada.
Constant comparison with a direct competitor may be demanding, but Pepsi has itself reinforced this dynamic. Since the 1970s, the two brands have competed openly through marketing, frequently using tongue-in-cheek references to each other. Pepsi, in particular, has repeatedly positioned itself explicitly against Coca-Cola. This long-running and highly visible rivalry is often referred to, half-jokingly, as “the Cola Wars.”
At corporate level, the picture shifts. While The Coca-Cola Company has remained focused almost exclusively on beverages, PepsiCo has pursued diversification since the 1960s and today generates almost twice the revenue of its long-time rival.
Ironically, PepsiCo is still number two, ranking as the world’s second-largest food and beverage company after Nestlé.
An example of the tongue-in-cheek rivalry between Pepsi and Coca-Cola, seen here at a MARTA station in downtown Atlanta, the home of Coca-Cola. When Pepsi was a main sponsor of the Super Bowl in 2019, held in Atlanta, the company used the occasion to cover downtown Atlanta in blue Pepsi advertising with subtle references to its red rival. Coca-Cola responded with a television commercial simply stating, “A Coke is a Coke.”Photo from CNN.
Pepsi-Cola in exchange for vodka and warships
A distinct chapter culminated in 1972, when Pepsi became the first Western consumer product produced under license in the Soviet Union. Because the ruble was not convertible, PepsiCo declined payment in currency and instead entered barter agreements. These included exports of vodka and, later, a fleet of decommissioned Soviet warships and submarines. The vessels were transferred to PepsiCo and subsequently sold for scrap, briefly making the company one of the largest private holders of naval tonnage in the world.
Russian Pepsi-Cola
In Kenneth’s collection
A 330 ml can (exp. March 2025) with 2023-logo, purchased in Denmark.
A 330 ml glass bottle (exp. Oct. 2025) with 2023-logo, purchased in Germany.
A glass bottle (empty), from the 1960s with screen printing, from Denmark.
