orgtheory.net

Brayden

The Wall Street Journal discusses what-appears-to-be a fascinating new book, The Real Pepsi Challenge, about the creation of Pepsi’s African-American sales division. Immediately before and after World War II, Pepsi’s CEO, Walter S. Mack, created a sales team specifically designed to target black Americans. Recognizing that blacks constituted a market roughly the size of the entire Candian population, Mack decided to go after this niche by hiring a black sales team, the first of its kind in a major U.S. corporation.

Mr. Mack had long believed that being different could sometimes provide an advantage. He started pursuing black customers by hiring a three-member sales team of African-Americans in 1940. During World War II, sugar rations and economic pressures made it all but impossible to continue that initial effort. But after the war ended, Mr. Mack decided to court the black consumer with a full department of salesmen, with a budget for advertising and promotional tools. In 1947, he hired Edward F. Boyd, a onetime singer and actor working then for the National Urban League in New York, to create the new division.

Six members of that team, now in their 80s and 90s, lived to tell their story for the book…Mr. Boyd, Dr. Jean Emmons of Florida, Allen L. McKellar of St. Louis, Julian C. Nicholas of North Carolina, William R. Simms of Massachusetts and Dr. Charles E. Wilson of New Jersey. To their delight, they also lived to see Indra K. Nooyi, an India-born woman, appointed chief executive officer of PepsiCo Inc. in August 2006 — not long after the company edged past Coca-Cola Co. in value of market capitalization. Both milestones would have been unthinkable in the days when the marketing team was working.

The creation of the sales division was a novel strategy that led to the emergence of the niche-marketing strategy that now dominates. The sales division also led to the advancement of the first African-American corporate vice-president in a U.S. company (Harvey C. Russell became a vice president in the company in 1962). Not all was rosey in this endeavour though. The black sales executives were underpaid compared to their white peers, they were confronted with segregation when doing sales trips to the South, and they experienced racism within the hierarchy of the company. Most of the sales team left the company after a new president took over in 1951. While the Pepsi strategy would be temporarily deterred, the legacy of the experiment was to create a new kind of marketing strategy, help to overcome negative stereotypes about black Americans as consumers, and to pave the way for future African-American executives. Looks like an interesting book.