Pepsi A.M.: the morning cola nobody drank after breakfast

In August 1989 PepsiCo began test-marketing Pepsi A.M., a variant of Pepsi with 25% more caffeine, aimed squarely at the morning drinker. The thinking was that American coffee consumption had been falling — from a peak of 3.12 cups per person in 1962 down to 1.75 in 1989 — while morning soft-drink share had climbed from 10% to 15% of all soda sales over a decade. Pepsi saw an opening to replace the morning coffee the market was giving up.

The product had two self-inflicted problems. Testers said the formula tasted flat, and the name itself — 'A.M.' — advertised that the drink belonged to the morning, so it was hard to sell to the afternoon or evening crowd the way a regular cola could be.

The morning-soda thesis did not translate into morning-soda sales. After about a year of disappointing results, production of Pepsi A.M. ceased in October 1990. It became one of the era's most cited beverage flops — a case where the market data pointed at coffee, and the answer Pepsi shipped was a cola nobody wanted at any hour.