Soft-Drink Giant Turns Russia's Ex-Reds 'Blue'

Russians may not know it yet, but their country has just "gone blue."

That's the word from PepsiCo, which last week launched its new "blue" image here with an announcement that it would invest more than half a billion dollars in Russia by 2000.

Of course, Pepsi never used to mind when the Soviet Union was red. Pepsi Cola was the first Western consumer product to be manufactured under the Communists back in 1974, and PepsiCo always enjoyed a cozy relationship with the Soviet leadership.

But "times are changing and so is Pepsi," says Niel Bainton, Pepsi's marketing director in Russia.

The highlight of a glitzy hard-sell presentation in Moscow, which featured a 30-foot-high Pepsi bottle masquerading as a rocket, was a live TV hookup with the Russian Mir space station. Floating in front of a poster proclaiming "Even in Space, Pepsi is Changing the Script," Russian cosmonaut Yuri Usachov intoned the campaign's Russian slogan.

The Mir space station was not the only former Soviet icon that has been dragooned into promoting carbonated soft drinks. Also on hand was Anatoly Dobrynin, Moscow's legendary ambassador to Washington for nearly 30 years. Forgotten were Mr. Dobrynin's diplomatic achievements - his role in averting nuclear war during the 1962 Cuban missile crisis, for example. Instead, he was introduced to the audience and applauded as the man "responsible for our first two Pizza Huts in Moscow."

From this perspective, in which cola consumption is the measure, Russians are a pretty hopeless bunch. Last year, the average Russian got through only 35 bottles of carbonated soft drinks when he should have been able to manage 150 bottles, judging by income levels, according to David Jones, Pepsi's president for Eastern Europe. Americans drink 800 bottles a year, on average.

Pepsi and its two new bottling partners are planning to invest $550 million in Russia over the next four years in what would be the largest consumer-product investment in the former Soviet Union. The money would build 11 new plants and set up distribution networks that would get Pepsi to 90 percent of the Russian population by the end of the century.

"Russia is a sleeping giant," Mr. Jones said.

Pepsi still outsells Coke, which arrived in Russia in 1986, by 2 to 1 here. But Coke's overall Russian sales, including drinks such as Fanta, have caught up with PepsiCo's total sales.

Pepsi's scramble to stay ahead has driven it to new heights in marketing - literally. The Mir space station is now an orbiting Pepsi billboard; Pepsi's Jones allows himself to dream of a Pepsi-sponsored moon landing. Meanwhile, on board a resupply rocket due to dock with Mir this week, according to space station spokesman Sergei Gromov, is a three-foot-high metal and cloth mock-up of a new blue Pepsi can. Once it has been filmed floating in space, the can will be disassembled and the metal parts disposed of in Mir's cargo space vehicle, along with other trash.

The vehicle will then be undocked, left to hurtle through space on its own - the first soft drink can to litter outer space.