BUSINESS
09/16/2014 02:11 pm ET Updated Feb 23, 2015

Why Mountain Dew Has No Reason To Fear The Return Of Surge

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PepsiCo-owned Mountain Dew has little reason to fear its resurrected rival, Surge.

Coca-Cola began once again selling the highly caffeinated citrus soda, discontinued in 2003, on Monday through Amazon in hopes of tapping into the beverage’s online community of cultish fans. But Surge, which debuted in 1996 as Coke’s second of three failed attempts to flatten Mountain Dew, will have trouble slurping up customers from the country’s fourth-most popular soda.

“Mountain Dew has found a niche and has seized it,” said Tom Pirko, who has advised PepsiCo and Coca-Cola for decades as managing director of industry consultant Bevmark. “It doesn’t have anyone who is able to break that hold.”

Coke has tried. The company launched Mello Yello in 1979, but it failed to become a hit nationally. The soda is still primarily sold in the southeastern United States to hit Mountain Dew, invented in Tennessee, on its home turf.

Next, Coke launched Surge, but it struggled to find an audience, wrote marketing executive Calvin L. Hodock in his book Why Smart Companies Do Dumb Things.

“It finally settled on pre-teens -- the idea was to grab them before they became Dew addicts,” Hodock wrote. “In the conference room it sounded wonderful, but Coke did not understand a key dynamic.”

That dynamic turned out to be that preteens don’t have much money to spend. Sales, therefore, were at the mercy of parental purse strings. And given the name, which connotes a sudden gush of electricity, mothers avoided the soda out of concern about the caffeine content. Schools banned it. Sales fell from 69 million cases in its first year to 51.8 million in 1998, then to 26.7 million in 1999, according to the Surge Movement, a group that campaigned to bring back the soda. By 2003, the brand was discontinued.

Coca-Cola did not immediately responded to a request for comment. Jennifer Ryan, a PepsiCo spokeswoman, declined to comment.

The irony of Surge's demise was that Mountain Dew contained more caffeine. With 55 milligrams of caffeine per 12-ounce bottle, Mountain Dew ranks as one of the most caffeinated soft drinks on the market. Surge, by contrast, contains 51 milligrams of caffeine.

Mountain Dew had long been laying the groundwork to become the first modern energy drink.

“They were the predecessor to everything we now know as an energy drink,” Pirko said. “It was always ‘do the Dew,’ and it’s the same thing Red Bull does with its ads.”

Throughout the 1990s, PepsiCo transformed the once-small Tennessee soda into a marketing powerhouse geared toward teens and young male fans of extreme sports.

A 1990 ad shows young adults waterskiing on a summer day:

Six years later, a commercial featured tennis Olympic gold medalist Andre Agassi bungee-jumping off cliffs, rollerblading over desert rock formations and soaring through the air from the back of a plane, all while screaming maniacally:

Still, Surge’s revival comes at a time when Mountain Dew may be vulnerable. Sales of fizzy drinks are struggling in the U.S. -- they fell 3 percent last year -- but energy drinks are soaring. And as the line distinguishing colas from drinks like Red Bull or Monster (in which Coca-Cola recently bought a 16.7 percent stake) blurs, the market may be ripe for a drink called Surge.

“Coke has come after Mountain Dew before, but it could be easier now because we see all these soft-drink categories melding together,” Pirko said.

But he said not to underestimate the strength of Mountain Dew.

“We used to jokingly refer to Pepsi,” Pirko said, “as the Frito Lay-Mountain Dew company.”

This article was updated with a response from PepsiCo.

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