Coca-Cola vs Pepsi
Subway to Replace Coca-Cola Products with Pepsi
In a significant shift in the beverage industry, Subway, one of the world's largest restaurant chains, has announced that it will replace Coca-Cola products with PepsiCo beverages in its U.S. locations starting January 1, 2025. This change comes as part of a new 10-year agreement with PepsiCo, marking the end of a longstanding partnership with Coca-Cola.
The new deal will introduce a variety of PepsiCo beverages, including Pepsi, Pepsi Zero Sugar, Mountain Dew, Starry, Tropicana, Lipton, Aquafina, and Gatorade, to Subway restaurants across the United States. The transition is expected to roll out over several months, with the introduction of new beverage equipment provided to restaurants as part of the agreement.
Subway's decision to switch beverage providers is based on aligning its offerings with guest preferences across demographics. The company aims to deliver better food and a better guest experience, which includes ensuring that the brand's beverage options meet consumer expectations. The change is also anticipated to provide additional value to franchisees.
Doug Fry, President of Subway, North America, expressed enthusiasm about the partnership with PepsiCo, describing it as an exciting milestone in Subway's journey to become America's favorite place to eat, drink, and work. He emphasized the win-win nature of the agreement, which promises to bring a delicious suite of beverage and snack choices to Subway guests while providing cost-effective, streamlined solutions to franchisees.
The strategic move by Subway reflects the ongoing competition between the two beverage giants, Coca-Cola and PepsiCo, which have been engaged in a so-called "Cola War" for over a century. Both companies have employed various marketing strategies to capture market share and consumer loyalty. Coca-Cola has traditionally focused on creating a timeless brand image and emotional connection with consumers, while PepsiCo has targeted a younger demographic and leveraged digital strategies and social media campaigns.
The rivalry has also seen both companies diversify their product portfolios beyond their flagship colas, adapting to changing consumer preferences by incorporating healthier options and focusing on sustainability initiatives.
As Subway prepares to make the switch, the company has also extended its partnership with Frito-Lay, PepsiCo's snack-food unit, through 2030. This extension will bring Subway's U.S. snack and beverage portfolio under one supplier, further driving efficiency across the system.
The announcement of the new partnership between Subway and PepsiCo has garnered significant attention, with industry analysts and consumers alike speculating on the impact this will have on both beverage companies and the broader restaurant industry. As Subway transitions to PepsiCo products, the move is expected to influence consumer choices and potentially reshape the competitive landscape of beverage offerings in fast-food chains.