Soda fountain in a drug store on Staten Island, with signs advertising Coca-Cola, as seen on a postcard. (The New York Public Library/Art Resource, NY)
IN 1885, Atlanta druggist John Stith Pemberton needed a new product on his pharmacy shelves. Sales of his popular Pemberton’s French Wine Coca, compounded from his own formula consisting mainly of wine and cocaine, were in jeopardy—not because of the cocaine, which was neither illegal nor unusual at the time, but because Atlanta had passed temperance legislation forbidding the manufacture and sale of alcohol (including wine) in the city.1 Pemberton started experimenting with other mixtures, hoping to formulate a “temperance medicine” using a concoction of coca leaves, kola nut extract, sugar, and flavorings: when he felt he had the right blend, he launched the new syrup called Coca-Cola. Pemberton believed that his concoction was a drug (as indeed it was), and he sold it to other druggists as a “brain tonic” and an “ideal nerve tonic and stimulant;” it cured “neuralgia, hysteria, and melancholy” and “nervous afflictions.” Company advertising also proclaimed that it would cure headaches, which it likely did. Ironically, Pemberton also believed it would cure morphine addiction, which it likely did not.2 Pemberton’s new concoction was one of many similar drugstore medicinal products, and like them, it had little chance of survival. But Coca-Cola thrived and so did the soda drink industry. Americans adopted soft drinks as one of their favorite beverages, and they remain so today.
Europeans have long considered mineral waters to be therapeutic, and water containing carbon dioxide was thought to have medicinal attributes. For centuries, European spas and resorts usually have been centered around mineral springs; people drank, and sometimes bathed in, the naturally carbonated waters as part of a health regimen. In the eighteenth century, the chemists Joseph Priestley and Antoine-Laurent Lavoisier were credited with the discovery that carbon dioxide was the source of the bubbles in natural springs, as well as the “fizz” in beer and champagne. By 1800, beverage manufacturers had discovered that they could produce fizzy water by adding a solution of sodium bicarbonate, thus creating carbonated water. However, the carbonation process was more fizzy when made under high pressure using sulfuric acid, and manufacturing carbonated water this way was more difficult and dangerous. Workers could be seriously burned by the acid, and containers of charged soda water sometimes exploded. Nevertheless, bottled sodas were being manufactured in Philadelphia and New York as early as 1807.3
It was not until the mid-nineteenth century that safer and easier mechanisms called soda fountains were devised to manufacture carbonated water. Soda fountains were sold throughout the nation by the 1850s.4 New technology was demonstrated at the 1876 Centennial Exposition in Philadelphia, where soda fountain manufacturers James W. Tufts and Charles Lippincott constructed a building with a thirty-foot-tall soda fountain and dozens of soda dispensers ready to refresh the throngs of fair visitors. Strong alcoholic beverages were banned at the exposition and the summer was extremely hot, so thousands of thirsty fair-goers were treated to their first taste of carbonated beverages. After the exposition closed, Tufts and Lippincott made a fortune selling soda fountains to drugstores around the nation.5
One beverage advertised at the Centennial Exposition was Hires Root Beer, created by a Philadelphia drugstore operator named Charles E. Hires. Hires Root Beer became America’s first successful national soft drink. Hires sold his root beer concentrate in packages to druggists, who combined it with carbonated water from their own fountains.6 It was also sold to individuals who could add the package to a gallon of regular water for a “Family Affair,” which promised “Health for the Baby, Pleasure for the Parents and New Life for the Old Folks.” As the temperance movement picked up steam in the late nineteenth century, Hires began advertising its root beer as “The Great Temperance Drink” and “a temperance drink for temperance people.”7
At about the same time, drugstore operators and pharmacists around the country began manufacturing and selling carbonated beverages. In Detroit, pharmacist James Vernor introduced ginger ale in the mid-1860s, and the beverage entered into commerce in 1880. In 1896, Vernor established his own soda fountain to dispense it and he began selling ginger ale extract to drugstores in other cities. In New England, an itinerant pharmacist named Augustin Thompson concocted Moxie Nerve Food in Lowell, Massachusetts, in 1876. Seven years later, it was converted into a soft drink that also appealed to the temperance advocates. Its advertisement proclaimed that Moxie was “rapidly crowding liquors out of the barrooms.” Quart champagne bottles of Moxie sold for the very pricey 60 cents.8
Toward the end of the nineteenth century, a pharmacist named Charles Alderton was employed at Morrison’s Old Corner Drug Store in Waco, Texas, which served carbonated beverages at a soda fountain. Alderton experimented with different beverage formulas, many of which became quite popular. The owner of the store, Wade Morrison, is credited with naming one of the soft drinks Dr. Pepper in 1885. One person who liked Dr. Pepper soda was Robert S. Lazenby, the owner of the Circle A Ginger Ale Company in Waco. In 1891, Lazenby went into business with Morrison and formed the Artesian Manufacturing & Bottling Company. One of their products was a black cherry–flavored soft drink that they called Dr. Pepper’s Pho-Ferrates, which quickly became a favorite in the Southwest. In 1904, the beverage was marketed at the St. Louis Exposition. The first known advertisement to employ Dr. Pepper’s first slogan (“Vim, Vigor, and Vitality”) and its mascot (a lion) appeared in Waco in 1906. This beverage became a tremendous success, and the company’s name was changed to the Dr. Pepper Company. (Subsequently, the period was removed from the Dr Pepper name.)9
A different type of soda company was formed by Roy Allen, who bought a recipe for making root beer; on June 20, 1919, he opened a root beer stand in Lodi, California, offering frosty mugs of root beer for a nickel. He opened more stands in Stockton and Sacramento, one of which may have been a drive-in. In 1920, Frank Wright, an employee at the Stockton stand, became Allen’s partner; they combined their surnames and called the company Allen & Wright Root Beer.10 The partners soon opened additional stands throughout California, Utah, and Texas. Allen bought out Wright in 1924, trademarked the A&W Root Beer logo (a bull’s eye and an arrow), and franchised the operation. Franchisees paid a small licensing fee, displayed the A&W logo, and bought root beer syrup from Allen.11
Yet another successful soda company was launched by Charles Leiper Grigg of St. Louis, Missouri. Grigg invented an orange-based soft drink called Howdy; in 1920, he created the Howdy Company. Grigg’s drink competed with many other sodas, such as Orange Crush, which then dominated the market, so he began experimenting with lemon-lime flavors. After two years of work, he came up with a beverage that blended seven different flavors; he introduced this Bib-Label Lithiated Lemon-Lime Soda in 1929. Shortly thereafter, the name was changed to 7-Up. At the time, Prohibition was still in effect, and 7-Up became a mixer for illegally sold alcoholic drinks. With repeal in 1933, sales were so successful that in 1936 Grigg changed the name of his company to the Seven-Up Company. Within ten years, 7-Up was the third-best-selling soft drink in the world. In 1967, the Seven-Up Company began an advertising campaign positioning the beverage as the “uncola,” which greatly increased sales. Later, it launched a campaign stressing the fact that it had no caffeine. This campaign was one reason why other soda companies began manufacturing decaffeinated drinks of their own.12
Cola-Based Soft Drinks
Two new soft drink ingredients emerged in the 1880s. The first was the kola nut, which had probably first been imported from Africa and the Caribbean into North America during colonial times. By the late nineteenth century, it was very common for the kola nut to be chewed by laborers, especially African Americans. Although bitter tasting, the nut was loaded with caffeine, and thus it served as a stimulant for exhausted workers.
The second new soft drink ingredient was coca leaves. Imported into America and Europe from South America by the early nineteenth century, the active ingredient in coca leaves—cocaine—became a common ingredient in patent medicines and, like the kola nut, was also used by physical laborers to boost their stamina. In the 1860s, vintners combined cocaine with wine to create Vin Mariani, which became one of the most popular beverages in Europe. In the United States, Henry Downes, a New York syrup manufacturer, produced Imperial Inca Coca in 1881; it was the first known soda drink to include cocaine. Other coca beverages, such as coca coffee and French wine coca, soon followed.13
In Atlanta, Georgia, John S. Pemberton had created his own successful mixture of cocaine and wine. When Atlanta went “dry” by banning alcohol in 1885, he returned to the laboratory, seeking to create a new beverage without the wine. During the early months of 1886, Pemberton experimented with a number of different combinations of coca leaves, from which cocaine is extracted, and kola nuts. He sent samples of these mixtures to an associate, Willis Venable, who leased the bottom floor of Jacob’s Pharmacy. It was not until May 8, 1886 that Pemberton’s experiment paid off. Venable had mixed Pemberton’s syrup with soda water, which gave the mixture a sparkling, bubbly effervescence that appealed to many customers.
When Pemberton saw that his latest formula was a success, he trademarked “Coca-Cola Syrup & Extract.”14 He then turned it over to one of his partners, Frank Robinson, to manufacture and sell. Twenty-one days after the drink first appeared at Jacob’s Pharmacy, Robinson took out an advertisement in the Atlanta Journal, trumpeting Coca-Cola to be “Delicious! Refreshing! Exhilarating! Invigorating! The new and popular soda fountain drink containing the properties of the wonderful Coca plant and the famous Cola nut.” When Pemberton’s health failed in 1887, he sold a portion of his business to Venable.15 Pemberton eventually relinquished the recipe for Coca-Cola, which ended up in the hands of a pharmacist and patent medicine manufacturer in Atlanta named Asa Candler. Candler expanded Coca-Cola syrup sales to soda fountain operators, who sold the new beverage for 5 cents a glass. By 1890, Candler was selling almost 9,000 gallons of Coca-Cola syrup annually.16 He reinvested most of his profits into the business and spent much money on advertising, which paid off handsomely. In 1900, the National Druggist magazine announced that Coca-Cola’s “commercial history reads like an episode from the Arabian Nights,” which “burst on the market some five or six years ago,” and its “popularity has increased with every year of its existence.” By 1899, almost 281,000 gallons of syrup—the equivalent of 36 million glasses—were being sold, and the following year Coca-Cola’s revenues topped $400,000.17
The bottling of Coca-Cola in the form of a fizzy beverage first began in 1894, but it was not until 1899 that a company in Chattanooga, Tennessee, was licensed as the exclusive bottler of the beverage. By 1909, there were more than 400 Coca-Cola bottlers in America, and therein lay one reason for the company’s early success: franchising the bottling operation made it possible for the company to concentrate on producing the syrup rather than on making or distributing bottled beverages. The syrup for Coca-Cola was easily transported, and there was no need to share the “secret” formula. Local bottlers or soda jerks had only to combine the syrup with soda to create the fizzy form of Coca-Cola. This allowed the company to quickly develop a national distribution system.18
The inclusion of coca leaves as an ingredient in Coca-Cola eventually generated problems with temperance movement leaders and medical professionals, who believed that ingesting cocaine was even more harmful than drinking alcohol. As a result, the Coca-Cola Company reduced the amount of cocaine in Coca-Cola in the early twentieth century, but the trademark required it to remain an ingredient. In 1913, the company came up with a compromise: eliminating cocaine and replacing it with “spent coca leaves,” which just became a flavoring. It was not until 1929, however, that technological advancements allowed the company to remove all active cocaine from the beverage.19
Coca-Cola became enormously popular, and many other druggists strove to match its success. In 1905, a Georgia pharmacist named Claude A. Hatcher began the Union Bottling Works in the basement of his family’s grocery store in Columbus, Georgia. Chero-Cola was the first of his Royal Crown line of beverages; this was followed by ginger ale, strawberry, and root beer sodas. In 1912, Hatcher changed the company’s name to the Chero-Cola Company. The company struggled through World War I when sugar was scarce, and it continued to have financial difficulties during the early 1920s. By 1924, however, the firm was strong enough to bring out a new line of beverages, called Nehi, with orange-, grape-, and root beer–flavored sodas. When Hatcher died in 1933, his successor—the company’s vice president, H. R. Mott—reformulated Chero-Cola and shortened the brand name to RC Cola.20
Yet another early cola experimenter was Caleb Bradham, a pharmacist in New Bern, North Carolina, who named one of his kola nut beverages Brad’s Drink. The formula for the beverage contained pepsin, a digestive enzyme that helps break down proteins in the stomach for easier digestion. Rechristened as Pepsi-Cola in 1898, the beverage became quite successful, and Bradham incorporated the Pepsi-Cola Company in 1902. Bradham then staked out new territory, and by 1907 the company had forty bottling plants across the United States. By 1910, Bradham had franchised more than 300 bottlers in twenty-four states to produce Pepsi-Cola. Bradham ran into financial problems, however, and the company went into bankruptcy in 1922. It was resurrected by a Wall Street broker named Roy C. Megargel, who controlled the company until 1931. In the midst of the Depression, the company went again into bankruptcy. This time the company was saved by Charles Guth, the president of the Loft Candy Company. The formula for Pepsi-Cola was changed at this time, eliminating pepsin as a major ingredient. By 1934, the Pepsi-Cola Company had turned the corner and started purchasing bottling operations throughout the United States. By 1939, the company’s net earnings had risen to over $5.5 million.21
The Pepsi-Cola Company was hurt again by World War II. When the U.S. government imposed sugar rationing early in 1942, Pepsi-Cola had to cut back production drastically. The Coca-Cola Company, though, received government contracts to supply America’s military with soft drinks, so it was supplied with sugar as needed. After the war, sales of Coca-Cola exploded as soldiers returned home thirsty for Coke. Even after the war, when sugar restrictions were lifted, Pepsi still had difficulty competing with Coke. By 1950, the Pepsi-Cola Company was almost forced to declare bankruptcy for a third time, but a highly successful advertising campaign came to the rescue. Throughout the 1950s, Pepsi expanded aggressively abroad, particularly in Latin America and Europe.
When Pepsi bought Frito-Lay, maker of salty snack foods, in 1965, it renamed the corporation PepsiCo. During the 1970s, PepsiCo acquired several fast food chains, including Pizza Hut, Taco Bell, and Kentucky Fried Chicken (now KFC). PepsiCo considered its fast food chains to be important outlets for its soft drinks, because all the chains sold Pepsi-Cola. However, other fast food chains refused to handle PepsiCo beverages because of competition with Pepsi’s own fast food chains. In 1997, PepsiCo divested itself of its restaurant subsidiaries, creating a separate corporate entity now called Yum! Brands. PepsiCo maintains the largest ownership in Yum! Brands, and all these chains continue to sell Pepsi beverages.
Diet Soda
In 1904, a Russian immigrant named Hyman Kirsch founded a soft drink business in Brooklyn. It sold ginger ale and other flavored soda water. In addition to running the soda company, Kirsch served on the board of a sanitarium for chronic diseases, many of whose patients had diabetes. Hyman, his son Morris, and a company chemist named S. S. Epstein began seeking an artificial sweetener that did not taste metallic, and they came up with cyclamate calcium. Their company released the first sugar-free soft drink, called No-Cal, in March 1953. During the following years, Kirsch Beverages aggressively marketed No-Cal ginger ale and root beer. Although its sales were only moderate, the idea encouraged others to produce diet beverages.22
The Royal Crown Cola Company introduced a diet beverage called Diet Rite Cola in 1958. Five years later, the Coca-Cola Company introduced Tab, a diet cola drink. The name was a play on words that derived from people “keeping tabs on their weight.” It sold well and, in 1967, the company released Fresca, a no-calorie, grapefruit-flavored soda. In 1970, Dr Pepper/Seven-Up, Inc., released sugar-free 7-Up, which was renamed Diet 7-Up in 1979.
Sales of diet drinks took off in the late 1970s. This increase can be attributed largely to attacks on sugar by nutritionists, who proclaimed that sugar caused many illnesses, including diabetes, heart disease, and obesity—and regular soft drinks were loaded with sugar. By 1980, diet soft drinks claimed about 20 percent of the soda market. In 1982, both Coca-Cola and PepsiCo released diet colas: Diet Coke and Diet Pepsi, respectively. These new products were supported by vast advertising campaigns. Consumers preferred the taste of Diet Coke and Diet Pepsi; their sales skyrocketed while Tab sales plummeted. By the late 1980s, a variety of diet drinks were on the market. Diet Mountain Dew, for instance, made its debut in 1988.
Marketing
Coca-Cola and Pepsi launched sophisticated advertising programs targeting youth. In 1961, Pepsi commercial proclaimed that “Now it’s Pepsi, for those who think Young.” Pepsi launched a more ambitious promotional effort two years later targeted at the baby boomers, who were now defined as the “Pepsi Generation.” In 1984, Pepsi launched another campaign targeting the baby boomers’ children: Pepsi was “The Choice of a New Generation.” The campaign included asking consumers to try both products in blind taste tests matching Coke and Pepsi. Even confirmed Coke drinkers chose Pepsi in these blind taste tests, and Pepsi inevitably won. The campaign increased sales, and Pepsi narrowed the gap with Coca-Cola. Then Coke made a major blunder: convinced that Americans preferred the taste of Pepsi, the company launched New Coke—a product that promptly failed. However, the company quickly rebounded when it reintroduced Classic Coca-Cola.
The soda advertising campaigns succeeded to such an extent that America’s most popular flavored beverage—coffee—was displaced by soda. The president of the National Coffee Roasters bitterly complained that “the Pied Piper” was “one giant cola bottle,” which made a lot of noise as he walked “through the marketplace with our youth flocking after him.”23 Soft drink manufacturers spent as much as 18 percent of their entire revenues annually on advertising, much of it targeting young people. Through advertising, soft drinks have not only increased their sales but also have shaped America’s self-image. When you quaff a Coke or Pepsi, the idea of quenching your thirst is only part of the picture. If the relentless advertising campaigns for soft drinks are to be believed, drinking the soda will also make you younger, sexier, stronger, smarter, and cooler—in fact, your entire life will be a blast.
Soda Central
Before World War II, hundreds of local soft drink manufacturers dotted the American landscape, but wartime sugar rationing drove many of them out of business. After the war, the surviving companies consolidated. In 1960, the western region soft drink company Shasta was acquired by Consolidated Foods (later renamed Sara Lee), and it was sold to the National Beverage Corporation in 1985. In 1962, Crush International was acquired by the root beer maker Charles E. Hires Company. In 1986, 7-Up and Dr Pepper merged to form the Dr Pepper/Seven-Up Companies, Inc. Schweppes expanded its global operation in 1969 by merging with the English chocolate manufacturer Cadbury to form Cadbury Schweppes. The new partnership then began acquiring other soft drink companies, such as Hires Root Beer in 1989, A&W Beverages in 1993, and Dr Pepper and Seven Up in 1995. In 2000, the RC Cola brand was acquired by Cadbury Schweppes, which, by 2005, had become the world’s third largest manufacturer of soft drinks, behind Coca-Cola and PepsiCo. In May 2008, Cadbury and Schweppes demerged. The North American beverages unit became the Dr Pepper Snapple Group, headquartered in Plano, Texas.
Today, the Coca-Cola Company is the most successful of the soft drink manufacturers, and it remains the largest soft drink company in the world. The company’s brands account for about 44 percent of the soft drink market in the United States. The company spends about $3 billion annually on advertising, and its annual sales are estimated at 1 billion servings sold in more than 2 million stores, 500,000 restaurants, and 1.4 million vending machines around the world. One of the most widely known brands in the world, Coca-Cola has, for better and worse, become emblematic of the United States of America.
The cost of producing soft drinks is low because the ingredients—water, carbon dioxide, sweeteners, colorings, and flavorings—are inexpensive. In the 1960s, the sales of soda in the United States surpassed the consumption of coffee, formerly America’s number-one beverage. According to the American Beverage Association, soft drink companies now gross almost $93 billion in sales in the United States, and the industry employs some 211,000 people in the United States. Together, Coca-Cola and PepsiCo and their subsidiaries sell more than 70 percent of the carbonated beverages around the world. In 2007, Americans drank 14.7 billion gallons of soda, which almost equaled the combined total sales of bottled water, fruit drinks, sports drinks, and other bottled and canned beverages. The three largest soda companies (Coca-Cola, PepsiCo, and Dr Pepper Snapple Group) account for all ten top-selling beverage trademarks.24
By the 1990s, Americans were drinking more than fifty-seven gallons of soda per capita. Although this number declined appreciably in subsequent years, soda remains the most commonly consumed beverage after water in the United States. Although adult consumption has declined over the past three decades, the consumption of soft drinks among American children from six to seventeen years old has tripled. In 2010, Americans bought approximately $18.7 billion of carbonated beverages—$5 billion more than total milk sales. According to Mark Pendergrast, author of For God, Country, and Coca-Cola (2000), the Coca-Cola Company alone “sells over 500 brands of 3,300 different drinks in over 200 countries, receiving some 80% of its income from sales outside the United States. Pepsi is still runner-up but a more serious contender.”25
Postscript
In 1888, three years after his invention of Coca-Cola, John Pemberton died. Asa Candler, the man who founded the Coca-Cola Company, served as mayor of Atlanta from 1916 to 1919. He suffered a stroke in 1926 and died three years later.
Caleb Bradham, the inventor of Pepsi-Cola who declared bankruptcy in 1922, died in 1934.
Charles G. Guth, usually considered the founder of the modern Pepsi-Cola Company, died in 1948.
A&W Root Beer went through many ownership changes beginning in 1960. A&W Beverages, Inc., was formed in 1971; it test-marketed A&W Root Beer in bottles and cans in California and Arizona. The product was well received and subsequently was distributed nationally, along with sugar-free, low-sodium, and caffeine-free versions. Today A&W is part of the Dr Pepper Snapple Group.
In 1965, Pepsi bought the Frito-Lay company and renamed the combined corporation PepsiCo. PepsiCo is today the largest producer of snack food in the world, but it remains second to the Coca-Cola Company in sales of soft drinks.
Hyman Kirsch, the maker of the first diet soda, died in 1976 at the age of ninety-nine.
Environmentalists worry about the amount of garbage produced by soda bottles. Plastic soda bottles produce an enormous amount of waste. Americans trash 40 million soda bottles every day. These bottles produce an estimated 3.2 billion pounds of unrecycled garbage annually.26
