INTEGRATED: integrated issues; Will a US law student teach PepsiCo a lesson?
By NICK GILLIES, campaignlive.co.uk, Friday, 30 August 1996 12:00AM
A spoof Pepsi promo may prove costly for the drinks giant, Nick Gillies reports
A spoof Pepsi promo may prove costly for the drinks giant, Nick Gillies
When PepsiCo in the US dreamed up the idea of offering a pounds 16
million Harrier Jump-jet in a spoof promotion, it never imagined anyone
would take up the offer.
However, the wheeze backfired when a business student, John Leonard, did
just that. Now the joke could cost PepsiCo up to dollars 25 million and
lead to changes in the law on advertising, not only in the US but in
this country as well.
The ad, which was devised by the New York office of BBDO, depicts goods
that can be won by accumulating tokens, or ‘stuff’ points, on Pepsi Cola
bottles. It shows a 13-year-old boy getting ready for school by putting
on a leather jacket and sunglasses as the number of points required to
win them (1,250 and 125, respectively) flashes underneath. The closing
shot depicts him landing a Harrier in his schoolyard with the figure
‘7,000,000’ flashing underneath - the number of points supposedly
needed to claim the jet.
The promotion says points can also be bought for ten cents each.
Consequently, Leonard got together a group of investors, who produced
the minimum three tokens and a cheque for dollars 700,000 to claim the
When PepsiCo refused to pay up, Leonard, instructed a Florida law firm
to issue proceedings in Miami.
Leonard has since set out his side of the case on the Internet
(http://k-i-s.com/johnsjet/), where he claims he dreamed up the idea
from what he learned in a class in contract law. Lawyers in this
country, however, are cautiously dismissive of his chances of success.
The basic point of law governing advertising in both the US and UK was
set out more than 100 years ago in England following the case of Carlill
versus the Carbolic Smokeball Company.
The company took out a newspaper ad that stated that anyone who caught
influenza within a month of using its smokeball product would get pounds
100 compensation. When the eponymous Mrs Carlill sued, the company
turned to the existing law of contract, which stated that a person
making an offer must know who they were making it to.
The judges, who loathed what they saw as vulgar advertising, compared
the ad with a reward for a lost dog; the advertiser wants their dog back
and doesn’t care who accepts the reward.
However, Stephen Groom, head of intellectual property at the UK
advertising law specialists, Lewis Silkin, says the judges were driven
by more than just distaste for the new medium. ‘They said they were
influenced by the ad, which said that money to cover any claims had been
deposited at the bank. They thought that showed it was meant to be taken
seriously,’ he says.
Leonard’s claim is not as clear-cut as he might have thought because the
ad was one in a series produced by BBDO, all of which were in the same
style and ended with an obvious joke.
Leonard’s claim could hinge on a PepsiCo press release that called the
jet the ‘ultimate Pepsi stuff award’, but he may have problems here,
too. PepsiCo’s US spokes-man, Brad Shaw, claims: ‘The language, and
everything about the release, made it clear it was a joke. There is a
long-established right to use humour in advertising.’
Vanessa Hall-Smith, a solicitor at the UK media law firm, the Simkins
Partnership, thinks the case would not get to court in this country.
‘The courts take a fairly robust view of what is real. There was a
credible offer in Carbolic Smokeball, but a Harrier is a ludicrous
offer,’ she explains.
Even so, agencies would probably do well to take greater care when
preparing promotional ads. Robin Price, who qualified as a lawyer but is
now a partner at Howell Henry Chaldecott Lury, says: ‘People always
sound me out during the development phase if they think there is
anything potentially dangerous, and I refer it to lawyers and tax
But Leonard’s claim has done nothing to deter PepsiCo’s efforts in this
country. A spokesman says that, although the company has not run loyalty
reward schemes in the UK, he does not rule them out. ‘They are a good
idea,’ he adds.
Although comparisons are being made with the Hoover ‘free flights’
debacle, where Hoover offered plane tickets worth much more than the
value of the goods purchased, a huge multinational such as PepsiCo is
unlikely to be hit too badly even if it loses.
This article was first published on campaignlive.co.uk
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