Who's Winning the Social Cola Wars? It's March Madness and the Battle Is On

03/28/2011 04:48 pm ET | Updated May 28, 2011

The Cola Wars are legendary and taught as case studies in business schools all across the country. Back in the 1980s, Pepsi ran a series of advertisements where people, caught on hidden camera, in a blind taste test, chose Pepsi over rival Coca-Cola. And many will of course remember the infamous strategic retreat Coke made on July 11, 1985, by announcing its plans to bring back the original 'Classic' Coke after recently introducing New Coke.

Pepsi had its groove on back then and it was heady times for the beverage company. But in spite of clever marketing moves, Coke kept beating Pepsi for the top spot in brand equity challenges. Coke has maintained that top spot for years, with Pepsi always at a strong second.

Fact is, these industry rivals are both very able and nimble competitors and neither should be considered down for the count. The long-term view is that these two have been in the boxing ring for years, swinging hard, retreating to their corners, then slogging it out for another round. And making billions on the seemingly unquenchable thirst the world has for cola.

Fast forward to this week, and it's 2011 March Madness in the era of real-time social media marketing. So who's winning the Social Cola Wars?

Looks like Pepsi's got its own version of March 'madness' going on. On March 17, 2011 Beverage Digest announced that Pepsi has fallen to third place behind Diet Coke in spite of its gutsy move to shift from Super Bowl TV ads to a global social charity program called the Refresh Project in 2010. Ouch.

Aha, cry the social media skeptics. This proves that social media is indeed a fad after all! We knew that social media was silly. See, the sales numbers are down! And in Pepsi's case, it looks like doing good did not translate into doing well. Negative ROI, case closed.

Meanwhile, Coke seems to be enjoying its return to multiple top spots. An American Idol sponsor, a solid presence with TV spots on recent Super Bowl and Academy Awards shows -- and now the NCAA and Coke Zero Social Arena, an online space devoted to combining the tournament with social media for March Madness. In fact, in 2010, Coke spent 2% of its NCAA tournament ad budget on social media. This year, it's spending more than 20%, with most of it in the Social TV category. Capturing real-time fan engagement is the Holy Grail in Social TV. That pivotal engagement point will create the spark for everything that comes next -- social shopping, couponing, location based rewards, mobile, etc. He who owns that 'Engagement Intersection' owns the future.

Not so fast. Pepsi feels that the Refresh initiative will provide a long term lift to its global brand profile as an impressive 87+ million votes were cast for charitable projects. It seems to be banking on that engagement translating into revenue in the long run. And Pepsi top marketing execs have proven that they have what it takes to polish brand tarnish -- just witness the comebacks of the sagging Doritos and Gatorade brands. Plus, Pepsi has a wider and more diversified product and brand portfolio than Coke.

The question now is, which cola giant will best harness the mega power of real-time social media? Will March Madness fans really go to the Coke Zero Social Arena site to engage or will they find each other on Twitter, Facebook, and/or other agnostic platforms? Will Pepsi refresh its brand by stronger integration of social and traditional messaging?

I say watch for a rogue market disrupter with smart social chops to jump into the ring and deliver that knock-out punch to the cola market. Energy drinks, anyone?

Beverly Macy is the CEO of Gravity Summit, Inc. and the co-author of The Power of Real-Time Social Media Marketing, published by McGraw Hill in January 2011. She also teaches Executive Global Marketing and Branding and Social Media Marketing for the UCLA Extension in Westwood, CA. Follow her on Twitter @beverlymacy, @PowerRTM, or @GravitySummit, or email at