Brand Failures

17 Pepsi AM
In the late 1980s, Pepsi spotted a previously unexploited consumer: the
breakfast cola drinker. Although Pepsi hadn’t conducted much comprehensive
market research into this area, the company realized that many young
adults were drinking caffeinated cola rather than coffee for breakfast. They
therefore came up with Pepsi AM, a drink ‘with all the sugar and twice the
caffeine.’
Unfortunately, Pepsi had failed to appreciate that although some people
drank Pepsi for breakfast, there was no specific demand for a new sub-brand
centred around that usage. ‘If a consumer doesn’t know he [or she] has a need,
it’s hard to offer a solution,’ says brand expert and marketing author Robert
McMath. ‘Sometimes a company can manufacture a need – but it’s expensive
that way.’
Nobody knew they wanted Pepsi AM, so nobody bought it. Furthermore,
many marketing experts have successfully argued that because its name
dictated when the product should be consumed, the market size was restricted
to specific-occasion usage. Another bad idea, another flop.