How Former PepsiCo CEO Roger Enrico Transformed the Corporation Into a Food and Beverage Giant
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Stroll the aisles of any grocery or convenience store, and you’ll witness Roger Enrico’s legacy.
Enrico started his PepsiCo career in 1971, marketing Funyuns for the company’s Frito-Lay subsidiary. He had earned a business administration degree from Babson College before serving in the Navy during the Vietnam War. Despite never enrolling in an MBA program, he quickly moved up the ranks at Pepsi, becoming chief executive of Pepsi-Cola USA in 1983 at the age of 38. By that time, he'd already had stints as brand manager of both Cheetos and Fritos, as well head of PepsiCo’s operations in Japan and South America. From 1996 to 2001, Enrico served as PepsiCo's chairman and CEO.
During his 30-year career with the company, he spearheaded crucial marketing campaigns that positioned Pepsi on par with Coca-Cola for the first time, pushing celebrity endorsements and the Pepsi Challenge. Behind the scenes, he shifted the company’s focus toward restaurants and food.
“Roger Enrico was, quite simply, one of the most creative marketers of his or any generation,” said Indra Nooyi, PepsiCo’s current chairman and CEO, in an email statement. “He was a risk-taker, never afraid to challenge the status quo.”
He made the “other guy blink.”
Pepsi had always ranked far below Coke, but when Enrico became chief executive of Pepsi’s USA operations, the tables began to turn.
Within a year of becoming the head of Pepsi-Cola USA, Enrico landed the ultimate celebrity endorsement: Michael Jackson. It was the largest sponsorship in history, at $5 million ($11.5 million in today’s dollars). The partnership gave Pepsi a fresh, youthful image and made the world’s hottest pop star the face of the brand, intertwining Pepsi with the King of Pop’s image.
"You couldn't separate the tour from the endorsement from the licensing of the music, and then the integration of the music into the Pepsi fabric. If you pulled any one of those pieces apart, it really took away from what the campaign was all about,” former TBA Global branded entertainment executive vice president Brian J. Murphy told Billboard in 2009.
Other celebrity endorsements followed, including Madonna and Michael J. Fox. By 1985, Pepsi’s share of the cola market had reached 30 percent, according to the Wall Street Journal. At that time, Coca-Cola became paranoid and altered its recipe, replacing it with New Coke.
“After 87 years of going at it eyeball to eyeball, the other guy just blinked,” Enrico wrote in a newspaper ad and a 1986 memoir titled, The Other Guy Blinked—How Pepsi Won the Cola Wars. New Coke’s launch went down in history as one of the most ill-advised marketing decisions of all time.
Then he made some major acquisitions.
Though it successfully positioned itself as a direct rival, Pepsi never fully overtook Coke in popularity. At the turn of the century, when Enrico served as PepsiCo’s CEO, he began to restructure the global corporation as a parent company for a diversity of other products. While PepsiCo had long been in the snack and restaurant business, with Frito-Lay, Pizza Hut, Taco Bell and KFC under its umbrella, soda was the company’s namesake and priority.
In 1998, PepsiCo acquired Tropicana Products from Seagram Co. for $3.3 billion. The following year, Enrico was responsible for spinning off the company’s fast-food division into Tricon Global Restaurants (now Yum! Brands). By 2001, he had completed a $13.4 billion acquisition of Quaker Oats Co., which produces Gatorade.
While a foray into food may seem puzzling, it was the smart move for Pepsi, which already had robust distribution channels in place through Frito-Lay. Enrico envisioned Pepsi and a food megabrand, and today, the company owns 22 iconic brands -- all of which generated at least $1 billion in sales in 2015, according to the company.
Today, PepsiCo's market value is $148 billion. Enrico left the company in 2001, but his marketing and growth strategies continue to pay off.