The Age Old Question, Coca-Cola or Dr Pepper? The History of Soda
When it comes to economic history, it is often thought that one must use fancy words that only business experts can understand to make a case about the economy or a business. The truth is that economist can tell the economic story or impact of a company much in the same way historians would tell any story about the past. Donald McCloskey argues that the economist is like the storyteller of business. In fact, according to McCloskey, storytelling is how historians make sense of the past. He says it is the history of historical sciences regarding economic history.[1] For the curious mind discovering the roots of, say, their favorite soft drink could be just as exciting as discovering the Gross National Product of Switzerland in 1944. Economic and entrepreneurial history lead us to discover the foundations of activities and even foods we consume daily. Have you ever thought of where Coca-Cola or Dr Pepper originated? Instead of focusing on things like Gross National Product (GNP) or even Gross Domestic Product (GDP), economists can explain the progress of a business or industry through other means. Randall Holcombe's article, "Progress and Entrepreneurship," explains that while economists can analyze industry success through GNP or GDP, there is another way to measure success through the welfare of humans with an emphasis on progress as a factor.[2] However, these terms of progress need to be broadly defined in order to understand the full impact a company or business has on the economy. Sit back and listen to a different kind of story, the story of how Coca-Cola and Dr Pepper were invented late in the 19th century. While both companies were founded around the same time they took different paths due to different visionaries leading the charge.
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| “Trace the Thirty Year Evolution of the Coca Cola Logo,” https://www.coca-colacompany.com/au/news/trace-the-130-year-evolution-of-the-coca-cola-logo |
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| Carol M, Highsmith, photographer. Dr Pepper Advertising Mural, Dublin, Texas. United States Dublin Texas, 2014. https://www.loc.gov/item/2015631060. |
According to the New York Stock
Exchange, the Coca-Cola Company is currently worth over 86 billion dollars, while Dr
Pepper is worth roughly ten billion dollars.[3] However, these numbers do
not tell the story of these two drinks, the ups, and downs over the past
135 years, or even how the companies were founded. Would you have guessed that pharmacist created both Coca-Cola
and Dr Pepper? Probably not, but it is true. The
journey to create sodas like Coca-Cola and Dr Pepper began in the 1760s. Scientists Joseph
Priestly and Antionine-Laurent Lavoisier discovered that carbon dioxide created
bubbles in mineral water. [4]
It had long been believed that mineral waters had a medicinal purpose, so Jacob
Schweppes used this new fuzzy sensation to add flavor and started
selling his product in Geneva, Switzerland.[5] Although the soda fountain
was invented in 1824, it would not be until right before the Civil War that it
would be used more in society. However, due to the belief in the medicinal purposes
of soda water and the expensive nature of manufacturing the soda fountain, soda water was
only sold in drugstores.[6]
While Coca-Cola may be more
globally recognized for its trademark colors and design, Dr Pepper hit the
market first. Pharmacist Charles Alderton began experimenting with adding different
flavors to soda water. When he finally came across a winning combination, he tested
his drink on customers of the local drug store. The drink was an instant hit. In
1885 Dr Pepper was served for the first time at Morrison's Old Corner Drug
Store in Waco, Texas for seven cents a drink.[7] Alderton began marketing his
new drink claiming that it had medicinal healing powers that "aids digestion and restores vim,
vigor, and vitality."[8]
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| Trademark registration by R. V. Pierce for Dr. Pierce's Compound Extract of Smart Weed or Water Pepper brand Medical Compound. , 1877. Photograph. https://www.loc.gov/item/2020749036/. |
One year after Dr Pepper was created, former Confederate Colonel John Pemberton created
Coca-Cola. Having been wounded in the Civil War, Pemberton was addicted to
morphine and desperately sought to break his addiction he created Pemberton's
French Wine Coca.[10] However, Fulton County enacted prohibition legislation, so Pemberton turned his French
Wine Coca into Coca-Cola by substituting the wine with sugar syrup and
rebranding the drink.[11] Due to the nature of the
temperance movement, Pemberton marketed his drink as a "temperance drink
that had healing and medicinal purposes. He claimed it was "a cure for many diseases, including morphine
addiction, indigestion, nerve disorders, headaches, and impotence."[12] Pemberton
realized that he could market his medicinal drink to everyone with the use of the soda
fountain instead of limiting his audience to only the sick. He charged only five
cents a drink, even though his competitors were selling theirs for more. Since Pemberton's
drink was invented during the heart of Reconstruction in the rural southern county
of Fulton, Georiga, he realized that everyone, even poor Southerners, could afford a
five-cent drink (the equivalent to $1.44 in 2020)[13].
The Memphis Appeal. 24 June 1887. chroniclingamerica.loc.gov/lccn/ sn84024448/1887-06-24/ed-1/seq-3/
The success of these two drinks has less to do with the refreshing taste that we have all grown to love today. Coca-Cola and Dr Pepper were created just before prohibition took control over most of the United States. The owners of these drinks quickly realized that if they marketed them as "temperance drinks," they could boost sales as an alternative to alcohol that was no longer allowed. The link between the temperance movement to the success of Coca-Cola and Dr Pepper is not well known today. Through the help of the Woman's Christian Temperance Union, soda sales flourished. At the time, soda was only served from soda fountains and was a readily available alternative to bars and saloons.[15] In order to enjoy a refreshing glass of coke a patron had to go to the drug store, which quickly led the enjoyment of sodas to socializing and entertainment.
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Runyon, Robert. "Soda fountain," Ca. 1900. The Center for American History and General Libraries, University of Texas at Austin. Reproduction Number 04093. |
While Coca-Cola and Dr Pepper have a similar start and capitalized on
the temperance movement, their stories go in a different direction. Asa Candler
bought the rights to Coca-Cola from Pemberton and rapidly began to advertise
the drink more effectively than his competitors. By selling the drink for only
$0.05, he undercut the market and created an image that Coca-Cola was
affordable for the everyday man. From there, the Coca-Cola empire has exploded,
which would explain more of why Coca-Cola is worth over 86 billion dollars
today compared to Dr Pepper's 10 billion dollar value. As Holcombe said, there
are more ways to measure a company's success than merely looking at their GNP
or GDP. When analyzing a company's progress, we see a much different version of
the story. The beginnings of both these companies tell the world about the mindset of people in the late 1800s. The success of these companies show how temperance played a role in boosting sales and ensuring that neither company failed. The current day value of the companies show the long term success of these companies, but without digging into the past and discovering the details of exactly how these companies started or who was in charge to bolster the success of the companies all that is left is a bunch of numbers that mean relatively little to the average person. These two stories show the American dream of striking it rich and inventing something that the world craves and entrepreneurship at its finest.
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[1] Donald McCloskey, “Economics as a Historical Science,” Economic History and the Modern Economist. Oxford and New York: Blackwell, 1986.
[2] Randall G, Holcombe, "Progress and Entrepreneurship," The Quarterly Journal of Austrian Economics 6, No. 3 (Fall 2003): 3.
[3]
New York Stock Exchange.
[4] Andrew F. Smith, "Soda and Soft Drinks," Daily Life through History, ABC-CLIO, 2022.
[5]
. A History of the American Soft Drink Industry; Bottled Carbonated
Beverages, 1807–1957. American Bottlers of Carbonated Beverages: Washington, DC, 1958.
[6]
Smith, "Soda and Soft Drinks,"
[7]. U.S. Trademark 71,561,734
[8] John Bloom, “Business: Sweet Revenge,” Texas Monthly. Emmis Communication (April 1978): 78
[9] Susan Eberman, "It was Created, Manufactured and First Sold in 1885 at Wade...[Derived Headline]." The Herald - Times, Aug 06, 2011.
[10] Richard Gardiner, “The Civil War Origin of Coca-Cola in Columbus, Georgia,” Muscogiana Journal of the Muscogee Genealogical Society Vol. 23, (Spring 2012): 22.
[11 Jack Hayes, “Coca-Cola Television Advertisements: Dr. John S. Pemberton,” Nation’s Restaurant News (January 2007).
[12] Pendergrast, Mark (2000). For God, Country, and Coca-CCola Basic Books. p. 32
“Trace the Thirty Year Evolution
of the Coca Cola Logo,” https://www.coca-colacompany.com/au/news/trace-the-130-year-evolution-of-the-coca-cola-logo
Carol M, Highsmith, photographer. Dr Pepper Advertising Mural, Dublin, Texas. United States Dublin Texas, 2014. https://www.loc.gov/item/2015631060.
Trademark registration by R. V. Pierce for Dr. Pierce's Compound Extract of Smart Weed or Water Pepper brand Medical Compound. , 1877. Photograph. https://www.loc.gov/item/2020749036/.
The Memphis Appeal. 24 June 1887. chroniclingamerica.loc.gov/lccn/ sn84024448/1887-06-24/ed-1/seq-3
Runyon, Robert. "Soda fountain," Ca. 1900. The Center for American History and General Libraries, University of Texas at Austin. Reproduction Number 04093. |
Bibliography
Primary Sources:
Highsmith, Carol
M, photographer. Dr Pepper Advertising Mural, Dublin, Texas. United
States Dublin Texas, 2014. https://www.loc.gov/item/2015631060.
The Memphis
Appeal. 24 June 1887. chroniclingamerica.loc.gov/lccn/
sn84024448/1887-06-24/ed-1/seq-3.
U.S. Trademark 71,561,734.
Secondary Books:
McCloskey, Donald.
"Economics as a Historical Science." Economic History and the
Modern Economist. Oxford and New York: Blackwell: 1986.
Pendergrast,
Mark. For God, Country and Coca-Cola. New York, Basic Books: 2000.
Secondary Articles:
Bloom, John. "Business:
Sweet Revenge." Texas Monthly. Emmis Communication (April 1978): 75-81.
Eberman, Susan.
"11It was Created, Manufactured and First Sold in 1885 at Wade...[Derived
Headline]." The Herald-Times, Aug 06, 2011.
Gardiner, Richard. "The Civil War
Origin of Coca-Cola in Columbus, Georgia." Muscogiana Journal of the
Muscogee Genealogical Society Vol. 23, (Spring 2012): 21-24.
Hayes, Jack. "Coca-Cola Television
Advertisements: Dr. John S. Pemberton." Nation's Restaurant News
(January 2007).
Holcombe, Randall
G. "Progress and Entrepreneurship." The Quarterly Journal of Austrian Economics 6, No. 3 (Fall 2003): 3–26.
. A History of the American Soft
Drink Industry; Bottled Carbonated Beverages, 1807–1957. American Bottlers
of Carbonated Beverages: Washington, DC, 1958.
"Trace the
Thirty Year Evolution of the Coca Cola Logo," https://www.coca-colacompany.com/au/news/trace-the-130-year-evolution-of-the-coca-cola-logo
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