Comparison of Pepsi and Coca-Cola's Advertising in the

New Media Environment Based on Cross-Cultural Theory

to Adapt to the Chinese Market
 Contents

1. Introduction .............................................................................................................. 3
2. Literature Review .................................................................................................... 4
2.1 The Intercultural Adaptation Theory of Advertising ........................................................... 4
2.2 Standardization strategy and localization strategy of cross-cultural embodiment of
advertising ................................................................................................................................. 4
2.3 Comparison of cross-cultural expression in two advertisements ......................................... 5
3. Research Methodology ............................................................................................ 6
3.1 Research Questions and Hypotheses ................................................................................... 6
3.2 Data Sample ........................................................................................................................ 6
3.3 Procedures ........................................................................................................................... 7
4. Research findings ..................................................................................................... 8
5. Discussion................................................................................................................ 12
5.1 Localization of brand name ............................................................................................... 12
5.2 Localization of advertising culture .................................................................................... 12
5.2.1 Advertising Positioning .......................................................................................... 12
5.2.2 The choice of spokesperson ................................................................................... 13
5.2.3 Advertising language .............................................................................................. 14
5.3 Localization of packaging design ...................................................................................... 14
6. Conclusion and Limitations .................................................................................. 15
References ................................................................................................................... 16
Appendix ..................................................................................................................... 18
1. Introduction

In 1967, Gore, director of the CBS Institute of Technology, first proposed the concept
of New media. UNESCO defines new media as "a medium for information
dissemination based on digital technology and the Internet as a carrier". In 1994, new
media began to appear in China. With the increase in the number of new media
platforms and the continuous popularity among the masses, the new media marketing
model of borrowing new media for marketing activities came into being.
According to data from iiMedia Research, 41.7% of users are exposed to new media
platforms for 1 to 2 hours a day, and 30.6% of users spend 2 to 4 hours a day on average.
In 2019, the scale of mobile social users is expected to reach 780 million. Besides, the
rapid development of short video and online live broadcast users has provided a good
traffic foundation for new media marketing.
With the development of world economic integration, more and more foreign
companies choose to explore the Chinese market. In the 2019 China Advertising Annual
Data Report, The overall scale of the advertising market reached 867.428 billion yuan,
with foreign brand advertising accounting for 1/3. Among them, foreign advertising also
prefers the advertising market of new media. A large number of multinational
companies use new media to advertise and attract target customersthrough videos and
pictures.
Therefore, we intend to study the comparison of Pepsi and Coca-Cola's advertising in
the new media environment to adapt to the Chinese market based on cross-cultural
theory. From the advertising composition, advertising content, and online advertising
language, we compare their cultural adaptability and discuss which of the two
advertisements is more popular with consumers.
2. Literature Review

2.1 The Intercultural Adaptation Theory of Advertising

In 20 century, Oberg, Adler, and Berry they all respectively mentioned acculturation.
Berry (1980) believed acculturation as adaptation, the reduction of conflict, which is
conceptualized in three modes: adjustment, reaction, and withdrawal.
Kim (1976) tried his best to provide theoretical explanations for communication
behaviors. In his research, he took language fluency, interactive potential, adaptive
motivation and mass media availability as independent variables, and interpersonal
communication and mass media consumption as dependent variables.
Kim (1979) proposed an interactive theory of communication and acculturation based
on a system’s and Kim’s extensive research. He mentioned that culture exchanges and
adapts in the process of interaction between ‘push’ and ‘pull’ and through the interaction
between ‘push’ and ‘pull’. In reality, the validation of acculturation ultimately occurs
in the host society.
As the company expands to the international market, the world market is going global.
Cross cultural issues are more important in determining firm performance (Levitt 1983;
Zou and Cavusgil 2002). Kotler (2003) states, “with faster communication,
transportation, and financial flows, the world is rapidly shrinking (p.383).”

2.2 Standardization strategy and localization strategy of cross-cultural

embodiment of advertising

"Standardization strategy" refers to "a brand management strategy in which products

of the same brand, with the same name and logo, the same packaging, and the same
advertising plan, are promoted to different regions and different countries". （ Guo

Qingguang.2003） "Localization strategy" refers to "make full use of the resources of

the target country in the process of cross-cultural communication, according to the
cultural background and unique economic and social conditions of the target country,
and take the needs of the target market as the starting point to formulate a brand
management strategy specifically for the target country ." （ Song Yushu, Wang

Chunfei2004.）
The debate on standardization and adaptation has a history of more than 50 years
(Agrawal 1994). Many researches confirm the higher use of standardization among
global firms. At the same time, subsidiaries of multinational companies and local
firms reflect more cross-cultural adaptability(e.g. Kanso and Nelson 2002). Affluence
of the country being targeted (James and Hill 1991), cultural values, product attributes
(Yin 1999), and country of origin (Tai 1997) are also being explored.
However, there is few relevant research on analyzing the foreign companies’
advertisement in mainland China with the acculturation theory. Therefore, we will
explains and analyzes the standardization and adaptability of advertising and try to fill
a gap in this area.

2.3 Comparison of cross-cultural expression in two advertisements

Nie Jingyi (2019) mainly focused on the changes between the two advertisements,
exploring the different value orientations, different strategic methods of the two in brand
positioning and advertising design, and the close relationship between them. Pepsi-Cola
adopts a differentiation strategy, pays more attention to the younger generation of
consumers, and advocates the positioning of a brand image that breaks through desires
and pursues challenges. And Coca-Cola adopts a localization strategy. Compared with
Pepsi, which pays more attention to young consumers, Coca-Cola relies on the theme
of reunion and home for brand promotion.
Tian Mengxue, Zhang Guangqi, and Chen Xiaohuan (2018) took the localization design
of Coca-Cola and Pepsi as the research object, and conducted a comparative analysis of
their localization design and explored the expression of localization design realization.
It was pointed out that if enterprises want to go global, they must conduct cross-cultural
communication and innovate marketing methods on the basis of fully
understanding the market in order to develop internationally.
Zhang Bo (2015) conducted some preliminary analysis on the cross-cultural marketing
strategies of Coca-Cola and Pepsi. Coca-Cola and Pepsi have both commonpoints and
differences in marketing strategies. There are certain differences in products, prices,
brands, consumer positioning, advertising, promotions, channels, andoverseas market
expansion.

3. Research Methodology

3.1 Research Questions and Hypotheses

From the three aspects: advertising composition, advertising content, and online
advertising language, the cultural adaptability of the two ads is compared, and We
further explore which of the two advertisements is more popular with consumers. In
light of the insights gained from the literature review, the present study formulates the
following hypotheses:
3.1 Research Questions and Hypotheses
H1: The Coca-Cola brand concept is partial to collectivism, while Pepsi is partial to
individualism
H2: Coca-Cola is biased towards feminism in advertising content, and Pepsi is biased
towards masculinity in advertising content.
H3: After comparing three aspects, Coca-Cola has better cultural adaptability.

3.2 Data Sample

According to data from iiMedia Research, nearly 30% of the interviewed users prefer
image-based advertising, and 21.5% of interviewed users prefer video-based
advertising. Image ads and video ads have a high degree of favorability among new
media users. In terms of the distribution of new media marketing advertising forms, the
proportion of video marketing increased from 9.0% in 2018 to 16.0%. More than 70%
of users agree with new media platform marketing advertisements and their
willingness to share is relatively high. New media users are more tolerant towards
new media marketing advertisements, among which the acceptance of short video
advertisements reached 43.5%.
Therefore, we select major domestic and foreign new media communication channels
(such as China's Weibo, Douyin, Bilibili, etc., foreign Facebook, Ins, YouTube, etc.)to
compare the degree of cross-cultural adaptation of Coca-Cola and Pepsi ads.
Refer to the appendix for advertisement comparison.

3.3 Procedures

The focus of this study is to compare the cross-cultural adaptation of the two major
advertisements, which mainly cover well-known new media communication channels
at home and abroad. After collecting all the samples, the data will be analyzed in two
parts, including:
Based on Individualistic Culture and Collectivist Culture, a comparison of the two
advertisements
Based on Masculine cultures and Femininity cultures, the comparison of different time
periods (holiday and non-holiday) of advertising

Based on Individualistic Culture and Collectivist Culture, a comparison of the two

advertisements
Features of Individualistic Culture： 1.The ideas of self-reliance, individual freedom
and equal competition are the core. 2.Personal needs first 3. ‘I, Me, Myself’ identity
as well as individual goals, individual achievements, and individual aspirations.
(Hofstede, 1980)

Features of Collectivist Culture：1.Core Value: People are members of groups rather

than individual party 2.A sense of belonging, loyalty, protection and unity is of high
degree of demanding. (Hofstede, 1980) This research will compare and analyze the
brand concept, advertising positioning, advertising language, and target customers of
the two advertisements, and try to explore the individualism and collectivism of the two
in their cross-cultural adaptation.
Based on Masculine cultures and Femininity cultures, the comparison of different
time periods (holiday and non-holiday) of advertising
Masculine cultures place high values on traits stress assertiveness, competition,
and material success. Femininity cultures place interpersonal relationships in
family group, caring or even more consensus-oriented. (Hofstede, 1980) This
research will count and collect the data about Coca-Cola and Pepsi's advertising
content bias in those selected samples. Then we try to analyze which ads are more
masculine advertising elements and which ads are more feminist advertising
elements.

4. Research findings

Figure1：Among the 71 samples collected, 28% chose Pepsi and 72% chose Coca-Cola.
Coke sells almost three times as much as Pepsi.It can be seen that the localization strategy chosen
by Coca-Cola is closer to the traditional Chinese spirit of home and country, and therefore it has
achieved better sales.
Figure2 ： From the chart, we can find that coke drinkers are mainly among young people aged 18-29,
among whom there are 33 people aged 18-23 and the same number aged 24-29. There are five people
over 30.It can be seen that Pepsi’s selection of the younger generation’s advertising positioning is
very accurate. At the same time, the friendship, sports and other elements that Coca-Cola mainly
promotes have also gained the love of a large number of young people.

Figure3：Among the factors that influence the choice of brand,52 votes were awarded for taste, 18
for packaging and only one for price. As a result, packaging is far more important to the customer
than price, even exceeding one third of the most important taste factor. It can be seen that the
innovation and promotion on packaging made by Coca-Cola and Pepsi in recent years is very useful.
Nickname bottle, lyrics bottle and other novel packaging attracted a lot of customers.
Figure4:Of the 71 samples collected, 24 percent liked the Pepsi ads and 76 percent liked the Coca-
Cola ads. Coca-Cola's ads are nearly three times as popular as Pepsi's. It can be seen that the
localization strategy adopted by Coca-Cola and the degree of deeper cultural adaptation lead to the
fact that the advertisements designed by Coca-Cola are more popular among Chinese people.

Figure5:In the 71 collected samples, 20% of the people have bought Coca-Cola's nickname bottle.
The proportion is still quite large, reflecting that this kind of packaging promotion of Coca-Cola's
nickname bottle has a positive effect on its sales. It can be seen that the customized packaging made
by Coca-Cola in line with the Chinese cultural market is very popular
Example1 ： Coca-Cola's advertisements focus more on shaping the emotional atmosphere by taking
pictures of family reunion. Emotional factors such as warmth and reunion are emphasized, which
are more Femininity and closer to Collectivism. People and collectives are inseparable.

Example2：Pepsi tends to choose a single male image as the main body in its advertising images.
The spokesmen are in good shape and look masculine and explosive. It was accompanied by the
words "Desire is power". In emphasis on Individualism, at the same time, also has the characteristics
of Masculinity. More popular with young men.

Example3：Coca-Cola's nickname bottle and Pepsi's emoji bottle

5. Discussion

5.1 Localization of brand name

When taking its Chinese name, Pepsi cola fully took into account the Chinese people's
interest in auspicious festival. Cola is a transliteration meaning "to be happy" in Chinese
culture. While the pronunciation of "Pepsi" in Chinese means all things, "Pepsi"

translates to "all things are happy" ， creating a local name that Chineseconsumers are

very fond of.

5.2 Localization of advertising culture

5.2.1 Advertising Positioning

Pepsi has always been positioned as a "new generation of Coke" and has won a large
market from young people. Pepsi has had many discussions with the advertising agency
BBDO, and finally "Pepsi: a new generation of choice" as the advertising theme. BBDO
has created many classic and vivid TV commercials, including sharks, spaceships and
other elements. These advertisements are aimed at young Americans who want a unique
way of consumption and their rebellious psychology to draw a clear line from the older

generation, making Pepsi’s sales in the US market soar. In

the Chinese market, Pepsi has also been using the younger generation of advertising
positioning. Through advertising, Pepsi strives to establish its "young, lively, and
trendy" image, while hinting at the delicious "old, outdated, and outdated" image. Pepsi
leads people to the forefront of society and releases vitality. It can be said to bea
younger cola.
Coca-Cola has always adopted an indifferent market coverage strategy in foreign
markets, striving to become a worldwide beverage, while bringing customers into the
spiritual world of Coca-Cola, which is a spirit of vitality, unrestrainedness and passion.
In the Chinese market, the Coca-Cola Company pays more attention to localized
business strategies while following the national strategy. In advertising, it is often
combined with traditional festivals. It features emotional elements such as "friendship"
and "happy hour". Especially the Spring Festival series of 1997-2002 series. Extensive
use of traditional art, such as firecrackers, paper-cutting and clay doll Afu, etc., to

express China ’ s unique New Year blessings by pasting Spring Festival couplets,

setting off fireworks and other folk activities. At the same time, Coca-Cola has shown
great enthusiasm by advertising at key moments such as China's entry into the WTO,
China's successful Olympic bid, and the Chinese FootballWorld Cup.
According to The Cultural Dimension Theory proposed by Hofstede (2010), Pepsi’s
marketing strategy is closer to Individualism, emphasizing personal abilities and values
rather than the overall social environment. Compared with Pepsi, Coca-Cola’s
marketing strategy puts more emphasis on Collectivism, which believes that people are
inseparable from society from birth. At the same time, in the choice of emotional factors,
Pepsi is obviously closer to Masculinity, more modest and tender, while Coca-Cola
emphasizes a warm home country atmosphere, which is closer to the characteristics of
Femininity.

5.2.2 The choice of spokesperson

Pepsi has hired Michael Jackson to promote it in the West, and produced an
advertisement with his song as the soundtrack, expressing Pepsi's brand positioning as
a "new generation of choice", and also implements music culture into the company
and products. When it first entered the Chinese market, Pepsi-Cola invited a lineup of
nine stars and went to Jordan to film the music mv of "Dare for more". In recent years,
Pepsi has invited new generation singers Wang Jiaer and Deng Ziqi as spokespersons.
Wang Jiaer and Deng Ziqi also collaborated on a Pepsi theme song "Love Is Together".
The song also conveys Pepsi's attitude of helping every young man who is dedicated
to chasing love.
5.2.3 Advertising language

Pepsi's advertising slogans are closely linked to its brand positioning, such as "This is
Pepsi, it belongs to the young heart" and "Breakthrough innovation discovers more".
While integrating the brand culture, it also conforms to the young people's mentality
of being aggressive and brave to make breakthroughs. While delineating the market, it
also demonstrates its strength.
Coca-Cola just entered the Chinese mainland with the slogan "You Can't beat the
feeling", which translates as "beat". At that time, China has just implemented an
opening-up policy, and China should strengthen its understanding of the world.
Therefore, the "You Can't beat the feeling" advertisement and the products promoted
by the Chinese are unstoppable. Therefore, the acceptance of the product advertised by
"You Can't Beat the feeling" by Chinese people was also unavoidable. "Drinking Coca-
Cola is not only to taste the drink, but more importantly to feel the spirit". Since then,
the Coca-Cola slogan in the Chinese market more combined with the Chinese spirit of
reunion, as well as the Chinese culture of "Cola" (meaning can be happy), so as to create
more familiar advertising words. For example: "Every coke, Coca-Cola", "Coca Cola,
open happiness", "reunion taste, is to Coca Cola"

5.3 Localization of packaging design

In recent years, Coca-Cola has printed popular vocabularies such as "artistic youth, pure
man, natural stupid, cat-star person, rich and handsome" on its packaging, andhas
launched a "nickname bottle" that has a sense of identity among young people.
Following the "Nickname Bottle", Coca-Cola launched the "Lyrics Bottle" in 2014. In
2015, it launched the “Training Bottle”. In 2016, it combined the Rio Olympics and
the Chinese Internet hot word “Like” to launch the “Like Bottle”. In 2017, Lu Han’s
“Honey Talk Bottle” was launched, which will be popular among young people. The
favorite online vocabulary is conveyed to consumers through cartoon images. This kind
of creative slogan can arouse consumers' desire to shop to the greatest extent and
become a way for people to advertise their ideals and personality.
6. Conclusion and Limitations

In our investigation, we found that Coca Cola was far more recognized in the sample
than Pepsi, which was 2.5 times higher than Pepsi. It also scored three times as many
votes as Pepsi when it came to whether Pepsi's AD or Coca-Cola's was more in line
with your taste. It proves that Coca-Cola's "universal" strategy has achieved greater
success. Therefore, a higher degree of cultural adaptation can indeed bring greater
consumer recognition and win a larger mainland market. However, our investigation
is still limited. Due to time constraints, we only had time to survey 71 individuals as a
data source. At the same time, due to age restrictions, we were unable to find more
people over 40 as a sample source. In future work, we can expand the research scope
and the limit of the age, to explore the localization of Coca-Cola to the people of
different age stages different functions.
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Appendix

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Coca-Cola
From WeChat Official Account
Advertising design based on different cities

Advertising elements in different cities not only accurately target customers, but also
an adaptation to local culture.

From T-mall, Jingdong, CCTV

new media official media.

Coca-Cola pays tribute to the DIY

version of reform and opening up,
including China's "Memorabilia"
from 1978 to 2018.

From YouTube
Commonality in culture: family warmth
Esta navidad, el mejQr regalo eres tu.
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The best gift is you in this Christmas.
Pepsi
 From Weibo

Pepsi pays more attention to the

culture of young people
Passion, struggle

From ins

Choose more male

spokespersons,
emphasize enthusiasm,
competition, place
high values on traits
stress assertiveness,
competition, and
material success.

(Bi http://www.pepsi.c om/

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 From WeChat Official Account
Young, enthusiasti c, online culture

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Most young male spokespersons

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Videos emphasize youth, enthusiasm, competition, and confidence
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Pepsi