The Pepsi promotion that caused mass riots and five deaths
In the Philippines in the early 1990s, a Pepsi promotional campaign was initially a huge success - before turning deadly.
In the Philippines at the start of the 1990s, Pepsi suffered what has been described as “one of the biggest marketing disasters in history”.
From millionaire joy to deadly riots
In a lottery-style promotional campaign, the beverage giant turned a number of Filipinos into millionaires at a stroke, by offering Pepsi customers cash prizes of up to one million Philippine pesos.
Initially, the promotion was a runaway success, reportedly leading sales of Pepsi drinks to rocket in the Southeast Asian nation.
However, when a major mix-up mistakenly left many Filipinos believing they had won the jackpot, the campaign’s popularity gave way to widespread fury. It sparked riots that left several people dead.
What happened in the ‘Number Fever’ fiasco?
In early 1992, as Pepsi sought to one-up soft drink rival Coca-Cola in what had become known as the ‘Cola Wars’, the New York-based company launched a campaign known as ‘Number Fever’ in the Philippines.
A promo that Pepsi had previously run in Latin America, ‘Number Fever’ doled out monetary prizes to Filipino customers who bought winning bottles of the drinks Pepsi, 7-Up, Mirinda and Mountain Dew.
To secure the seven-figure jackpot - which equated to about $40,000 at the time - a number printed on the underside of the bottle’s cap had to match a figure announced on Filipino television, on the ABS-CBN news program TV Patrol.
Per Bloomberg journalist Jeff Maysh, the average monthly salary in the Philippines at the time was about $100. “A million pesos was wealth beyond anyone’s wildest imaginations,” he notes. Smaller prizes were also available, down to 100 pesos.
According to reporting by the Los Angeles Times in 1993, more than 51,000 people received cash prizes during the promo campaign - including 17 jackpot winners.
Such was the initial success of ‘Number Fever’ that it was extended beyond its originally-planned 12-week run, for a further five weeks. The campaign reportedly led Pepsi’s sales in the Philippines to rise by 40%.
But on May 25, 1992, disaster struck, in the form of the now-infamous ‘349 incident’.
That evening, TV Patrol’s viewers were told that holders of bottle caps bearing the number 349 on the underside had scooped the one-million-peso jackpot.
Pepsi had made a huge mistake, though. While the company normally printed only a couple of bottle caps with the jackpot-winning digits on it, 349 had been stamped on somewhere between 600,000 and 800,000 caps nationwide.
Hundreds of thousands of claims came in for the grand prize. Pepsi would have had to fork out tens of billions of dollars had it honored every claim it received.
Five die as protests turn deadly
After an emergency meeting, Pepsi decided to offer holders of mistakenly printed ’349′ bottle caps around $20 each instead of the jackpot, as a “goodwill gesture”.
The company explained that it could only pay out cash prizes in full for caps whose lottery number was accompanied by a specific security code. The required code, Pepsi said, was missing on almost every ’349′ cap.
At a cost of some $10 million to Pepsi, nearly 500,000 ’349′ caps were exchanged for the firm’s smaller cash offer, per a Philippine Star report that cites a Pepsi lawyer.
The company also paid a $6,000 fine to the Philippines’ consumer protection bureau, the L.A. Times notes.
Many angry customers were not persuaded by Pepsi’s vastly lower compensatory offer, however - and riots followed, with deadly consequences.
At one protest, a schoolteacher and a five-year-old girl were killed when a grenade bounced off a Pepsi truck and exploded. Later, three Pepsi workers died when a grenade was thrown into a company factory.
Filipino court sides with Pepsi
Within a year of the ‘349 incident’, nearly 700 civil suits had been filed and over 5,000 criminal complaints lodged against Pepsi, the L.A. Times said.
One group of plaintiffs, Ugnayan 349, secured a judgment at a Filipino court ordering Pepsi to pay its members 10,000 pesos each in damages.
But after a series of appeals and counter-appeals, the Philippines’ Supreme Court ruled in 2006 that Pepsi did not have to pay out winnings or damages to holders of erroneously printed ’349′ caps.
The court later wrote: “349 crowns bearing the wrong security code are not winning crowns. Hence, petitioner PCPPI [Pepsi Philippines] is not liable to pay the amounts printed on the crowns to their holders. Nor is PCPPI liable for damages thereon.”
“Pepsi a taboo word”
In the end, Pepsi may have managed to wriggle out of an 11-figure lottery-winnings bill and avoided having to shell out more than the initial - albeit not insubstantial - $10 million in compensation.
But more than three decades on from the ‘349 incident’, the company is still feeling the after-effects of the debacle.
“Pepsi’s ‘Number Fever’ disaster changed the legacy of that soft drink in the Philippines forever,” Bloomberg’s Maysh says. “Some people of a certain age won’t touch it. For many people, Pepsi is a taboo word.”
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