Bloody Bottles

Cola wars in Thailand

The global sales competition between Coke and Pepsi has produced some of the catchiest tunes in advertising, as well as a lot of intricate high-level maneuvering in Washington, where the winner was sometimes determined by who sat in the Oval Office. PepsiCo Chairman Donald Kendall got the right to bottle and sell Pepsi in the Soviet Union in 1972, when his friend Richard Nixon was in the White House. After Jimmy Carter moved to Washington, his old Atlanta pal Coca-Cola Chairman J. Paul Austin captured the exclusive right to sell Coke to a billion Chinese. Rarely, though, has the Coke-Pepsi rivalry gone so far as in Thailand, where it has now led to two deaths.

Both Pepsi and Coke have campaigned vigorously for the Thai market. Tropical thirsts have driven consumption of soft drinks there up to a strong 50 to 60 bottles per person per year, despite an annual per capita income of only $350. Although Coke's overall sales, including those of Sprite and Fanta, top Pepsi's total market share 46% to 34%, Coke alone has long trailed Pepsi by a wide margin.

In recent years, Coke had begun closing the gap, but the Thai government hurt the company's sales a year ago when it raised the excise tax on soft drinks by more than 100%. That made Coke and Pepsi raise their prices from a dime to 15-c- a bottle. Thai peasants, who leaned toward Pepsi but occasionally bought both drinks, were forced by the higher prices to cut their consumption and choose one or the other. More often than not, they chose Pepsi.

Coke salesmen became increasingly nervous. One of them, identified only as Tin, spotted Pepsi Salesman Thongyu Meksuk putting up Pepsi posters in a small open-air restaurant on the outskirts of Khampaeng Phet, about 200 miles northwest of Bangkok. Such point-of-purchase advertising is important in Thailand, since about 96% of soft drinks are consumed where they are bought. Coke and Pepsi have long squabbled over prime space in cafes and other public places.

An angry Tin began tearing down his rival's posters. Enraged, Thongyu shouted at Tin. The two men then agreed to settle the matter with a fistfight and departed in clattering bottle trucks for a field near by. On the way, though, Tin pulled his truck alongside Thongyu's and, according to witnesses, blasted him with a shotgun. Thongyu was left dead at his wheel; Tin disappeared.

This was not the first murder in Thailand's cola wars. Two years ago, a Pepsi distributor stabbed a Coke man to death. A court later ruled that the Pepsi employee had acted in self-defense. Such violence is common in provincial Thailand, where political instability has imparted a certain Wild West atmosphere.

But local officials of the two companies deplored the recent murder. Said Coke's Win Mumby: "Both Pepsi and Coke have reasonable managements who try to prevent this kind of thing." Added Pepsi's Leonard DuBoff: "A poster certainly isn't worth a man's life." Thongyu's death did accomplish one thing. For a few moments, it got Coke and Pepsi to think seriously about the limits of their rivalry.

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