The Cause That Refreshes: Project Boosts Pepsi Brand, Not Sales - AKA, "Is there any way to be sure, going into a social media campaign, that it will actually help sell your product?"

One year in, the Pepsi Refresh Project encapsulates both the potential of social media and some of its paradoxes: specifically, is there any way to be sure, going into a social media campaign, that it will actually help sell your product?

By all accounts, Pepsi Refresh has been a big success in its stated goals of raising Pepsi’s brand awareness and burnishing the brand’s image, by giving away millions of dollars of grants to charitable initiatives large and small, with individuals and organizations submitting ideas online, and winners chosen by online voting. Altogether Pepsi allotted $20 million to fund grants in the project’s first year, working out to about $1.3 million in grants per month.

Aside from some complaints about bigger organizations dominating the voting (which Pepsi has addressed with some tweaks to the submission categories and voting process) there’s no question that Refresh has created a lot of mostly positive buzz around the Pepsi brand — from social media mini-campaigns created by people submitting ideas, and media coverage of winners and their charitable projects, among others.

And the online metrics are indeed impressive: Pepsi tells the Wall Street Journal that the Pepsi Refresh Project has received more than 150,000 idea submissions in the last year and tallied 76 million votes from 17 million unique visitors over the same period. In addition to casting their votes, these visitors also left 1.6 million comments, suggesting a pretty high level of engagement with the site and the concept in general, while the Facebook page attracted more than three million “likes.”

The only problem: the incontrovertible success of the Pepsi Refresh Project as a social media campaign doesn’t seem to translate into actually, you know, selling more of the product — at least in the short term. The total volume of Pepsi sales slipped 8.6% in the first nine months of 2010 compared to the same period in 2009, according to figures from trade pub Beverage Digest cited by WSJ.

True, this was partly due to economic conditions (and probably growing concern about obesity and health eating): archrival Coca-Cola saw total sales volume decline 6.6% in the same comparison. But it’s hard to spin an 8.6% drop in sales as evidence of success for the brand’s main marketing effort in 2010.

Of course, this touches on the ever-present issue of social media ROI. If you’re inclined to be sympathetic to Pepsi (and supportive of bold social media experiments), you might argue that it’s too soon to judge the actual, long-term effect of the Pepsi Refresh Project. Sure, its sales may have taken a hit from recessionary pressures, but the positive associations engendered by Refresh will linger in the collective imagination for years to come, buoying brand awareness and sales in the long run.

If you’re a skeptic, on the other hand, you might argue that any marketing campaign which doesn’t bear some kind of fruit — quantifiable fruit, with dollar signs on it — in a year or less is basically useless. True, brands do conceive and execute multi-year marketing campaigns, but I imagine almost always with the expectation that some benefits will be realized immediately (within the first year) in terms of sales lift — thus justifying the continuing expenditures.

Source: Media Post

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