How Crystal Pepsi Became the Soda World’s Greatest Fail
Midway through the Super Bowl of 1993, a commercial for a revolutionary new “clear cola” sparked a national craze. Set to the Gen X anthem “Right Now” by Van Halen, the ad was supposed to feel edgy. It featured an astronaut, a rhino, and a woman guzzling the translucent elixir. “Right now, we’re all thirsty for something different,” it proclaimed. “Introducing Crystal Pepsi.”
The soft drink quickly became the cool kid of the vending machine. Marketed as a “pure” and “natural” spin-off of classic Pepsi, it was showcased on CBS Evening News, parodied on Saturday Night Live, and begrudged by competitors at Coca-Cola. From high school cafeterias to Wall Street power lunches, millions of Americans were excited to try it.
Crystal Pepsi was poised to become a billion-dollar idea. Instead, it was a colossal flop. Less than a year after the commercial hit the airwaves, the soda was yanked from the shelves. It became a cultural laughingstock and was later dubbed one of the biggest product failures of all time by TIME Magazine. But the full story behind its rise and fall has remained a mystery for decades.
"The best idea I’ve ever had -- and the most poorly executed"
“It could have been more than just a novelty,” says David Novak, the former Pepsi marketing executive who created the soft drink. “It was probably the best idea I’ve ever had -- and the most poorly executed.”
How did Crystal Pepsi go from pop culture darling to the beverage world’s biggest fail? Novak and others tell a tale of a rush to launch before the recipe tasted right, along with a never-before-told food science nightmare and a failure by company honchos to listen to criticism.
The Clear and Caffeine-Free Brilliant Idea
The idea first struck Novak like a can of soda falling from the sky. The year was 1992 and the sale of classic colas like Pepsi and Coke were stagnant. By contrast, lighter soft drinks such as Slice and Clearly Canadian were on the rise. “Everything that was growing in sales was either clear or caffeine-free,” Novak recalls. “I was sitting in my office, and it hit me: Why not make a Pepsi Cola that’s both?”
Novak called PepsiCo CEO Roger Enrico with the pitch. “I knew I was playing with the family jewels because the company is Pepsi Cola,” he said. But he made a solid case -- that occasional soda drinkers want a lighter tasting, healthier-seeming alternative. And his bosses went for it.
Cracking the Code
To create the see-through spinoff, Novak teamed up with food scientist Surinder Kumar, the junk food wizard behind the flavor of Nacho Cheese Doritos. Novak explained the idea and stressed the importance of clear bottles to show off the drink’s hip new look, according to Kumar.
Kumar, who was then head of Pepsi’s Research and Development branch, balked at first. He foresaw a huge problem. “I knew it had a strong possibility of going bad in clear bottles,” he said. “Colas are brown for a good reason.”
The color keeps sunlight from spoiling the drink, and morphing it into a brew that “smells and tastes like shoe polish,” he says. Ever wonder why 7-Up and Sprite are sold in green bottles? It’s the exact same concept, he stressed to Pepsi executives.
“But Pepsi’s motto at the time was ‘Go Big.’ And so I was told, ‘You’re a food scientist -- figure it out,’” Kumar says. “From a technical standpoint, I thought it was impossible. There are laws of physics and chemistry you can’t change.”
But he set out to try. The goal was to make a caffeine-and-preservative-free clear soda that tastes like original Pepsi but wouldn’t eat into its sales. Over the next few months, he concocted a recipe that included a mix of sugars and salts -- along with a secret substitute for the caramel-brown color and flavor, which he’s still not at liberty to disclose.
Problem was, honchos wouldn’t tell him the full recipe of regular Pepsi, he says. Only a few execs at the firm knew the coveted trade secret, which made it harder to replicate. To Kumar, it felt like guarding a castle in a blindfold.
“Imagine trying to protect the flavor of something without actually knowing what’s in it,” he says. “It was difficult and very frustrating.” (Pepsi didn’t return requests for comment.)
Kumar also wasn’t hot on the idea of marketing Crystal Pepsi as healthy. It was made with high fructose corn syrup and had roughly the same amount of calories. “It was misleading to consumers. My point of view was if we want to market it as ‘pure’ and ‘natural’ then the ingredients need to reflect that,” he says.
Focus groups didn’t seem to mind. “They loved it,” according to Novak. “So I rushed it into the test market.”
Rush for Super Bowl Glory
In April 1992, the drink launched in Boulder, Colorado, and was soon flying off the shelves. “It was the hottest news in the category,” Novak recalls. “People were calling their friends and shipping them six-packs. Everybody wanted to try it.”
But in Novak’s mind, the clock was ticking. He wanted the soft drink to launch nationally in time for the Super Bowl on Jan. 31, 1993, as part of a $40 million ad campaign.
All told, Crystal Pepsi was rolled out across America at breakneck speed -- just nine months after Novak’s first pitch. By contrast, “It took us three years to launch Slice,” Kumar says. “It wasn’t enough time to accurately test its shelf-life.”
"Everybody will try this...but nobody is going to retry it"
Bottlers gave Novak the first hint that something wasn’t right. “They said, ‘You have a really good idea, but the problem is that it doesn’t have enough Pepsi Cola flavor in it,’” Novak says. “One of them told me, ‘Everybody will try this. The problem is nobody is going to retry it.”
He added, “They had a unique perspective that I basically ignored... And they were right.”
After the Super Bowl commercial, sales of $1.50 six-packs soared. The company sold $474 million of Crystal Pepsi by March 1993, according to The New York Times.
Crystal Pepsi’s immediate success sent competitors at Coke into attack mode. The company launched Tab Clear in what chief marketing officer Sergio Zyma described as a mutual destruction effort to fail -- and take Crystal Pepsi down with it. He hoped to kill it off by confusing shoppers into thinking it was a diet drink.
“Pepsi spent an enormous amount of money on the brand and, regardless, we killed it. Both of them were dead within six months,” Zyma said in the book, Killing Giants: 10 Strategies to Topple the Goliath in Your Industry.
Whether or not the scheme actually worked, not many people tried Crystal Pepsi twice. Novak thinks the flavor simply wasn’t good enough. “Because we rushed it, we were having product quality problems. It had more of an aftertaste than it should have had,” he said.
The Crystal Gravy Kiss of Death
SNL even spoofed the soft drink with a commercial parody for “Crystal Gravy.” In it, actress Julia Sweeny dunks a piece of chicken into a lube-like clear meat sauce as Kevin Nealan splashes it on his face, absurdly. (Asked about the sketch, Sweeny told Thrillist, “I have no memory of it but I laughed really hard seeing it. It's really gross!”)
Pepsi honchos weren’t laughing. “We didn’t like [the sketch] because they were basically saying it didn’t taste good,” Novak says.
More serious dilemmas soon began to bubble up. “Cases of Crystal Pepsi were being displayed sitting out in the direct sunlight at gas stations,” Kumar says. “That was the kiss of death.”
As he predicted, ultraviolet rays caused the soda to spoil. Reports began pouring into Pepsi headquarters from customers saying the stuff tasted strange, according to Kumar.
"It could have been more than just a novelty"
By 1994, less than a year after Crystal Pepsi’s big launch, it was discontinued. “I was disappointed that it wasn’t more enduring,” Novak says. “If we had gotten the flavor notes to taste more like [original] Pepsi Cola, it could have been more than just a novelty.”
Two decades later, in 2014, the soda was named one of the “10 worst Worst Product Fails of All Time” by TIME Magazine, which noted, “Many of the purchases were likely due to curiosity.” Crystal Pepsi relaunched temporarily three years later as a way for the firm to cash in on ‘90s nostalgia.
Ultimately, Novak has some regrets. “I let my passion for the product override real issues,” he admits. “I still have a bottle of Crystal Pepsi in my office to remind me to take risks, be creative -- and listen to people." He now runs the consulting firm David Novak Leadership and likes to use the story of Crystal Pepsi as an anecdote about what not to do.
Kumar has a different take: Crystal Pepsi is still lodged in the minds of Americans, and that means the company did something right. “It’s good to shoot for the moon, and that’s what we did,” he says. He just wishes the firm had scrapped the whole “healthy” marketing angle. “I learned that you can’t trick the consumer -- at least not for long.”