The Evidence · Case: Coca-Cola vs Pepsi
The brand decides before taste
When the product is almost identical, it is the perception of the brand, and not the taste, that decides preference, what the brain registers and the value that remains.
There are few pairs of products as close as a Coca-Cola and a Pepsi. According to McClure and colleagues (2004), they are almost identical in chemical composition. And yet one is worth, as an asset, roughly three times more than the other. That distance is not in the liquid. It is in perception.
This case is not a marketing opinion. It is one of the rare episodes in which the same question was answered by two independent routes: neuroscience, which observed the brain choosing, and the market, which registered the choice in share and in value. Both point to the same principle: perception decides, and perception converts into a financial asset.
Blind, taste rules. With the brand in view, it stops ruling.
In the study by McClure and colleagues (2004), published in Neuron, the participants tasted the two soft drinks under controlled conditions. In the blind test, the activity of the ventromedial prefrontal cortex correlated with the stated preference. Taste, on its own, had a voice.
The picture changed when the Coca-Cola brand became visible. According to the authors, brand knowledge had a dramatic influence on the expressed behavioural preferences and on the measured brain responses. The same drink, the same brain, a different choice. The difference was the brand information, not the chemistry.
Without the emotion region, the brand effect disappears
The second route tightens the argument. Koenigs and Tranel (2008), in Social Cognitive and Affective Neuroscience, studied patients with a lesion in the ventromedial prefrontal cortex. In these patients, the brand-induced change of preference does not occur. In their words, damage to that region abolishes the Pepsi paradox.
The reading is direct. If, by switching off the brain's system of emotion and valuation, the brand effect disappears, then that effect does not arise from taste. It arises from perception. The brand does not season the drink: it reorganizes the decision.
New Coke: the market rejected the winning taste
On 23 April 1985, Coca-Cola launched a reformulated recipe, preferred in consumer tastings. The product that won in the cup lost on the shelf. On 11 July 1985, after 79 days, the original formula returned as Coca-Cola Classic.
The episode isolates the principle better than any laboratory. People were not asking for the taste back. They were asking for the brand back. When the company delivered the objectively preferred liquid, the public refused it, because the value was not in the sip, it was in the meaning the brand carried.
Perception converts into asset and into share
What the brain registers, the balance sheet confirms. In Interbrand Best Global Brands 2025, the Coca-Cola brand appears in 7th place, valued at 60.1 billion dollars. Pepsi appears in 38th, at 20.3 billion. Comparable products, roughly three times the distance in brand value.
The pattern repeats in the market. In the North American carbonated soft drinks segment, the Coca-Cola brand held about 19.2% of volume share in 2023, against about 8.3% for Pepsi, according to Beverage Digest data cited via Visual Capitalist. The brand that loses in blind tastings sells more than double. Perception does not stay in the consumer's head: it leaves there in the form of share and of value.
What this case does not prove
This case proves the force of a principle, not a universal equation. The neuroscientific evidence is above all correlational, and the replication itself is open: van Doorn and Miloyan (2017), in Food Quality and Preference, argue that no single study has provided closed proof of the existence of the Pepsi paradox. We treat brand neuroscience as a strong indication, not as a settled consensus fact.
The New Coke episode has more factors than taste versus brand: loyalty, ritual, habit and media coverage weighed in. And the value and share figures come from a proprietary model (Interbrand) and from a secondary source that tabulates paid data. They serve to compare magnitude and read a pattern, not as realized price nor as proof of single cause. Nothing here guarantees, on its own, the return of a specific brand in another market.
The Coca-Cola vs Pepsi case proves the principle: when the product is almost equal, it is perception that decides, and perception converts into a financial asset. What this case does not do, and no case does, is say how much that perception is worth in a specific business. That is measured case by case. It is precisely there that a Strategic Listening begins: to diagnose where your brand is being decided, what the current perception is costing you or earning you, and what part of that value is still to be captured.
Book a Strategic ListeningSources
Neuroscience of decision
- McClure SM, Li J, Tomlin D, Cypert KS, Montague LM, Montague PR — Neural Correlates of Behavioral Preference for Culturally Familiar Drinks · Neuron · 2004 · doi:10.1016/j.neuron.2004.09.019 Source
- Koenigs M, Tranel D — Prefrontal cortex damage abolishes brand-cued changes in cola preference · Social Cognitive and Affective Neuroscience 3(1):1-6 · 2008 · doi:10.1093/scan/nsm032 Source
- van Doorn G, Miloyan B — The Pepsi Paradox: A review · Food Quality and Preference · 2017 (replication note)
Brand history
- The Coca-Cola Company — New Coke: The Most Memorable Marketing Blunder Ever (historical archive) · 1985/reissued Source
Value and market