Within months of Prohibition’s introduction, drugstore soda fountains had replaced bars and taverns as the social epicenters of Main Street America. But it wasn't just soda drawing in the customers.
Under the Volstead Act, drugstores became the only place where alcohol could be purchased legally, provided it was for medicinal purposes. Strangely, the need for medicinal alcohol grew rapidly after Prohibition. In 1921 alone, pharmacists withdrew more than eight million gallons of medicinal whiskey from federal warehouses, twenty times the amount they dispensed before Prohibition. Soda fountains also did a roaring trade serving their regulars with drinks that were anything but soft. The J-Bar at the Hotel Jermone in Aspen, Colorado, reinvented itself as a soda fountain but spent most of its time whipping up Aspen Crud, a cocktail of vanilla ice cream soda laced with bourbon that became an illicit favorite with the Sunday after-church crowd.
The authorities weren't dumb. Soon drugstores were playing cat and mouse with the law enforcement agencies that began raiding pharmacies and seizing barrels of suspect medicine. In one 1929 raid, federal agents busted a soda fountain liquor ring in Meridian, Mississippi, after receiving reports that young men and women were “getting hilarious” on their Coca-Colas.
The fountains had been offering customers a mix of Coca-Cola and Jake, the most notorious black market liquor of all. Bootleg booze had a reputation for harshness and dubious ingredients, but Jake took the danger of illicit liquor to a whole new level. Formed from fermented Jamaican ginger, this perilous beverage contained an adulterant that was supposed to fool the feds but proved highly toxic. Within weeks of going on sale, the vicious drink had left an estimated 15,000 to 100,000 people impotent or partially paralyzed for life. The hobbling walk of those crippled by the drink became known as “Jake leg.”
But for the hip young things of the Jazz Age, the illegality and danger of moonshine were all part of the thrill and romance of Prohibition drinking. Alcohol was never far away from the rebellious bobbed-haired flappers and their male counterparts, the sheiks, as they swung their way through the Roaring Twenties. To counter the harsh burn of bootleg liquor they turned to soda-based cocktails or mixed drinks, which had been uncommon in the days before Prohibition, when soda was more often used as a chaser than as a mixer for alcohol. In speakeasies they would order “set ups” of cracked ice and ginger ale or club soda into which they could discreetly slip a measure of bathtub spirit from their handy and oh-so-chichi hip flasks. Cola may have overtaken ginger ale as America’s favorite fizz by the dawn of the Jazz Age, but the appeal of the latter as a mixer drove its sales to new highs in the 1920s.
It is often claimed that ginger ale was first developed in Ireland by the American apothecary Dr. Thomas Cantrell around 1850, but drinks bearing the same name were being advertised as early as 1818. Regardless of its exact origin, ginger ale was a variation on ginger beer, the sweet, dark, yeast-fermented drink that had become popular in Britain during the early 1800s. Initially there was little difference between ginger ale and ginger beer, but over time ginger ales evolved into ginger-flavored drinks carbonated with soda water rather than yeast that were clear rather than cloudy.
Ginger ale lived in the shadow of ginger beer for several years until the introduction of Cantrell’s Belfast ginger ale turned the drink into an American favorite. Cantrell’s drink inspired a wave of what are now called golden ginger ales. One of the drinks inspired by Cantrell was Vernor's, the 1866 creation of Detroit pharmacist James Vernor that gained a reputation for being so fizzy it caused people to sneeze. Vernor's ginger ale became a regional favorite in Detroit and Michigan and stands today as America’s oldest surviving soda brand.
The next leap forward for ginger ale came in 1900 courtesy of Canadian pharmacist John McLaughlin, the reserved Presbyterian son of a carriage maker from Enniskillen, Ontario. McLaughlin entered the soft drinks business in 1890 using the dowry from his marriage to Maud, a haughty redhead from a wealthy New York family, to open a Toronto store where he sold bottles of sarsaparilla, lemon, and cream soda under the brand name Sanitary. In 1900 he added a ginger ale to the range, but his wife and customers found his drink too syrupy for their tastes, so he began work on a lighter colored and less sweet version. Four years later he launched McLaughlin’s Pale Dry Style Ginger Ale, a new form of ginger ale that offered a lighter, less pungent taste. A year later he renamed it Canada Dry and, at his wife’s suggestion, started promoting it as “the champagne of ginger ales.”
Canada Dry spread rapidly through the Canadian provinces, and while most people drank it straight, McLaughlin’s dry ginger ale also gained a reputation as a mixer thanks to its mellow taste. In 1923 the drink’s appeal as a mixer prompted two businessmen, Perry Saylor and James Mathes, to buy the business for a cool million dollars. The Canadian-born Saylor and his American partner took Canada Dry into the United States with a direct appeal to Prohibition drinkers. They billed it as a New York nightclub favorite, sold it in miniature champagne-style bottles and rode the speakeasy boom to enormous success. In just four years Canada Dry went from selling 1.7 million bottles a year to more than 50 million in 1926. Almost everyone who bought Canada Dry used it as a mixer, with surveys suggesting that as many as three-quarters of ginger ale drinkers used it to mask the taste of bootleg liquor.
Ginger ale became so big during Prohibition that even the notorious gangster Al Capone got in on the act, setting up ginger ale and club soda bottling plants so that he could monopolize the mixer market in Chicago. He and his older brother Ralph “Bottles” Capone, who was put in charge of the mobster’s soda operation, made millions from the business. The marriage of soda and alcohol established during Prohibition would prove to be one of the temperance movement’s most enduring legacies, prompting a change in American drinking habits that still lingers on today.
But while Canada Dry built an empire in the speakeasies, Coca-Cola was enjoying even greater success. By the time Robert Woodruff took charge in 1923 the company was in great shape, with the challenges of the late 1910s resolved. The 1920s lay before the company ready for the taking, and Woodruff used this rosy inheritance to turn Coca-Cola into the epitome of modern business. During the first twenty-five years of his leadership, Coca-Cola would not just dominate the fizzy drink industry but transform how all businesses operated and weave its product into the very soul of America. Woodruff’s Coca-Cola captured the spirit of the 1920s. It was an age of bold dreams, expansive plans, and modernist thinking in which synthetic plastics, refrigeration, cars, color advertising, radio, airplanes, and telephones fundamentally reshaped the world. One of the fruits of this push for the modern was a vision of the corporate boss as a decision-maker reliant on the expert knowledge of PR specialists, lawyers, researchers, salespeople, and advertising creatives to run their businesses. Woodruff was nothing if not a professional manager. Under his stewardship Coca-Cola became a firm at the cutting edge of modernist corporate management.
One of the first signs of the cigar-puffing six-footer’s determination to modernize, standardize, and improve was his early push to clean up Coca-Cola’s bottling plants. Bottled Coca-Cola sales were still behind those made at the soda fountains, but the lucrative potential of the home and take-away market was obvious. The only hurdle was the lingering image of unsanitary bottles that still put many people off. For Woodruff, cleaning up the bottlers was a priority, and, the company legend goes, he witnessed the problem firsthand shortly after becoming president when he visited a Coca-Cola bottling plant. Inside he found piles of broken glass, dust-covered machinery, and pools of spilled Coca-Cola syrup swarming with flies. Furious, he told the bottler that if the plant wasn't clean by the next day they would no longer be a Coca-Cola bottling plant. “But Mr. Woodruff,” pleaded the bottler, “it don’t do no good to clean up. The next day it’ll look like this again.” Woodruff removed his cigar from his mouth and growled: “You wipe your ass, don’t you?”
Woodruff began issuing edicts to the company’s twelve hundred bottlers that dictated everything from employee dress codes and delivery truck color schemes to hygiene standards and the exact amount of syrup to be used in each bottle. To enforce these rules he formed a quality control department to monitor their output and used local advertising support as a carrot and a stick. Bottlers who did what they were told got advertising support, those who did not found Coca-Cola advertising dollars vanished from their territory. By 1928 more Coca-Cola was being sold in bottles than at the soda fountain, where Woodruff continued his push for a standardized beverage by getting soda jerks to serve the drink in the now iconic bell-shaped Coca-Cola glasses that came with a mark showing exactly how much syrup to pour in.
Woodruff’s quest for standardization was fueled by his ardent belief that the image mattered as much as the product’s actual quality. Coca-Cola the liquid might be unremarkable but the brand that came with it was anything but. For Woodruff, Coca-Cola was not just a drink but a lifestyle choice, and its public image was as crucial as any ingredient in its secret formula. In fact the secret formula would play a vital role in Coca-Cola’s efforts to turn its soda into a corporate totem. In 1925 the company relocated the lone copy of the formula from the New York bank vault, where it had been held since the sugar crisis, back to Atlanta in a blaze of publicity. Then it made public the procedures surrounding the mysterious document—policies that seemed more appropriate for a state secret than a soda recipe. Employees needed approval from the board to even look at the document, and only two Coca-Cola employees were permitted to know the recipe at any one time. The secret formula was more than a trade secret; it was now a holy relic—a divine object of mystery sealed deep within an impenetrable vault.
This was myth-making on a Wizard of Oz scale: any chemist worth his or her salt could decode much of the formula, as the hundreds of cola copycats had proved, and there wasn't really anything that special lurking in the liquid. But that was, in many ways, the point. It wasn't the drink that mattered so much as what customers believed it to be. And the task of telling them what to think about the drink fell to Archie Lee, the company’s advertising mastermind.
Born and raised in Monroe, North Carolina, Lee grew up dreaming of writing literary novels and leaving an impression on the world. “I feel that to work just for money’s sake would be a desecration,” the idealistic youth once wrote to his mother. “I want to do something really worthwhile. I would die happy if it should be just one recognized and lasting thing.” Lee’s search for greatness took him into journalism, but after several years as a reporter he made the leap into advertising by joining Coca-Cola’s ad agency D’Arcy, where he took charge of the Coke account in 1923. Today Lee’s approach seems obvious, but in the 1920s it was groundbreaking. Most advertisers were still stuck in a rut of verbose text-heavy promotions that often resorted to dry, functional detail or to scare tactics to win business. Lee had little time for such approaches. “The offering of a product is blunt selling,” he wrote in a 1945 letter summarizing his beliefs about advertising. “Presenting the idea from the consumer angle is using imagination.”
He presented Coca-Cola not as a mere beverage that would quench your thirst but as something symbolic of innocent everyday pleasure. He commissioned artists such as Norman Rockwell and McClelland Barclay to paint scenes of happy times, sociability, and rural tranquility that he then complemented with a message condensed into a bite-size slogan, short enough for motorists to absorb from a roadside billboard in a single glance. Messages like “Thirst knows no season” and “6,000,000 drinks a day.” Simple, eye-catching, and backed with a budget capable of putting these ads in front of millions of eyeballs, Lee’s creations set the tone for the future of advertising. Lee’s most memorable slogan, “The pause that refreshes,” came in 1929. It and the myriad variations on that theme he created captured the public imagination so effectively that the company was still using the slogan twenty years later. Its impact was still being remembered seventy years on, when the industry journal Advertising Age named it one of the ten best campaign slogans of the twentieth century.
Lee’s gentle nostalgia and positive sell captured something about the American spirit, and as the 1920s went on, people began more and more to think of Coca-Cola as representative of America. People began talking about things being “as American as Coca-Cola,” and in the southern states Coca-Cola cake, a moist chocolate cake made with the soda, became a common sight at picnics and church events. The suspicion that surrounded the drink before the First World War was gone. Now Coca-Cola was part and parcel of American life. Nothing illustrated this change in public attitudes as much as the reaction to the news that the Women Christian Temperance Union of Arkansas City would devote 1929 to stamping out the “hydraheaded menace of Coca-Cola.” Instead of finding the public rallying to their crusade, the temperance activists watched their short-lived campaign get lampooned in the newspapers and dismissed as a joke.
Many of Lee’s campaigns drew on the insights that came from Coca-Cola’s statistical department, another of Woodruff’s innovations. Formed in 1923, the department brought a scientific edge to the company’s operations. It gathered vast amounts of data about traffic patterns in towns and cities throughout the United States, so that the company could pinpoint exactly which billboards would have the most impact. It identified the most valuable retailers in the country so Coca-Cola’s sales force could visit them twice as often as less lucrative stores. It analyzed the shopping habits of forty-two thousand drugstore customers and then used the results to teach soda fountain operators how to sell more Coca-Cola and how to encourage Coke drinkers to buy additional items. The statisticians also enabled the company to start accurately predicting future sales and profits—no mean feat for a company of Coca-Cola’s size in a computerless age. And in late 1928 Coca-Cola’s statistical department sent a warning to Woodruff that an economic crash was coming.
The soda pop giant’s numbers men were right. The Roaring Twenties had been a decade of speculation, excess, and a widespread belief that share prices would keep going up and up and up. But this party came to a screeching halt in October 1929 when the stock market crashed. In the space of a week millions were wiped off the value of stocks, erasing personal and business fortunes. To recover from the losses U.S. banks began refusing to lend money to Germany to help it rebuild, prompting the German economy to collapse, which frightened American shareholders even more. Soon there were runs on the struggling banks, and businesses across America started going bust, leaving millions out of work. The Great Depression had begun.
As the economic crisis deepened, people stopped buying soda as they tried to make ends meet. Soon the soda fountains and retailers that the fizzy drink industry relied on were going under in the thousands. “There has been a tremendous loss in outlets,” Coke’s vice president of sales Harrison Jones told Woodruff in a 1932 memo. “We have found that practically all bottlers are experiencing an inability on the part of many of their small outlets to buy more than one case and pay cash. In many cases, when the truck calls in the morning, the dealers are required to ask them to come back later in the day, until such time as they can get enough money to pay the cash for a case of Coca-Cola.”
Coca-Cola responded with more advertising. While Moxie and others slashed back their advertising budget, Woodruff kept spending big—a move that made Coca-Cola even more visible than ever. “In the last four years there has been less advertising of every kind and character than at any time in fifteen years,” wrote Jones. “Since we maintained our advertising showings in all media we have stuck out as a sore thumb, and have been more dominant unquestionably than at any time before in our history.” The company’s ad budget went further too. Billboard owners didn't have enough advertisers to fill their boards, so instead of leaving their poster sites vacant, they gave Coca-Cola space for free, enabling the company to blanket America in Lee’s visions of a happier America.
Lee fulfilled his end of the bargain by finally producing a campaign good enough to convince people that Coca-Cola was an all-year-round drink rather than a summer treat with a series of Christmas ads painted by Haddon Sundblom. Born in Muskegon, Michigan, in 1899, the Swedish American artist had already made his name in advertising with his work for Maxwell House and Palmolive by the time Lee asked him to illustrate Coca-Cola’s 1931 Christmas ad. Lee wanted an illustration of Santa Claus having a refreshing pause with a Coca-Cola, and Sundblom was happy to oblige for the appropriate fee. Partially inspired by Clement C. Moore’s poem “A Visit from St. Nicholas,” Sundblom painted a smiling, ruddy-faced Santa toasting the audience with a glass of Coca-Cola. He modeled the character on his retired friend Lou Prentiss. “He embodied all the features and spirit of Santa Claus,” Sundblom explained. “The wrinkles in his face were happy wrinkles.” The advertisement proved so successful that Coca-Cola made its Santa advertisement an annual event, with Sundblom illustrating every one of them until 1964.
It is often claimed that Sundblom’s ad created the look of the modern-day Santa Claus with his red suit, black leather belt, white beard, and bobble hat. But the reality was that Sundblom simply latched onto the emerging consensus about how Santa looked. Traditionally Santa and his European forerunners had come in all shapes and sizes. Sometimes he was tall and skinny; at other times he was the squat, pipe-puffing elf from Moore’s poem. Santa’s garb also varied from the bishop’s clothing of the Dutch Sinterklaas, who would kidnap naughty children, to Britain’s Father Christmas, who wore green robes, to the present-day red-and-white outfit. Despite Santa’s mixed-up origins in folklore, paganism, and Christianity, by the time Coca-Cola hired Sundblom, the idea of St. Nick as a fat man with a big white beard dressed in red was already becoming the archetype of the Yuletide gift giver.
In fact, not only was Sundblom’s depiction simply tapping into a wider trend, but this popular vision of Santa had even been used to promote soda pop before. The Santa in White Rock’s 1915 Christmas ads looked much like Coca-Cola’s Santa, although he preferred to make his festive deliveries of the Wisconsin soda firm’s drinks by automobile or biplane rather than by sleigh and magic reindeer. A few years later in 1923, White Rock was running Christmas ads in color magazines showing a Santa almost indistinguishable from Sundblom’s enjoying a whiskey and a White Rock ginger ale while catching up on his mail. Luckily for Santa, Prohibition didn't apply in Lapland. But while Coca-Cola’s Santa was not by any stretch of the imagination the origin of the modern-day St Nick, it probably sealed the deal once and for all with its ubiquitous year-in, year-out Christmas advertising muscle.
Not that all its extra advertising, Coke-guzzling Santas, and statistical wizardry worked miracles. Coca-Cola sales flat-lined in the Depression, the growth of the 1920s replaced with stagnation. Compared to most of its rivals, though, this was a good result. Charles Hires watched sales of his root beer fall off a cliff, dropping 60 percent between 1930 and 1935. Nor were sales of Hires’ temperance drink helped by the end of Prohibition in April 1933. The noble experiment had proved little more than the naivete of the temperance campaign. In the hope that the return of the liquor industry could help the moribund economy, the federal government consigned the Volstead Act and Eighteenth Amendment to the trash can of history.
The return of alcohol worried the soda industry. In the first six months of Prohibition, soda sales leaped by 200 percent and kept rising all the way up to the Great Depression. The question now haunting the industry was whether the repeal of Prohibition would reverse all of that. Would people still want a Coke when beer was readily available? Would they still need ginger ale in their drink when distilled liquor didn't taste like gasoline? The breweries hoped not. Schoenhofen Edelweiss greeted the end of Prohibition by sidelining Green River, the soda that saw it through the dry years, and refocusing on beer. Soon the breweries that survived by making smoked ham and ice cream were poised for a glorious return.
At Coke, vice president of sales Harrison Jones was particularly twitchy. He wrote to Woodruff warning that the brewers would be a serious threat to Coca-Cola. They were buying ads like crazy, he noted in one memo. In another he urged Woodruff to launch a Coca-Cola beer to grab a share of the expected post-prohibition liquor boom. Woodruff dismissed the proposal. Coca-Cola made Coca-Cola, nothing else. At first it looked as if Jones was right. After several years of flat sales, 1934 saw Coca-Cola’s revenues dip by about 25 percent to $31.2 million. But the hit was short-lived, and in 1938 the company’s annual sales reached a new high of $75.8 million. Coca-Cola had survived once again.
Coca-Cola wasn't the only soda company to buck the trend for decline in the Depression. Another success story was the lemon-lime drink 7Up. Its creator Charles Leiper Grigg was born in 1868 in a log cabin in Price’s Branch, a tiny hamlet in Montgomery County, Missouri, with a population of just twenty-five people. As a child Griggs became obsessed by mail-order catalogs and the array of wonderful goods on offer within their appealing pages. He was still obsessing about catalogs at the age of twenty-two when he wrote to a St. Louis mail-order company to tell them that their catalog wasn't up to scratch and explained how it could be improved. “If you think you can do better, come to St Louis and do it,” the firm replied. So he did.
Grigg spent the next three decades working in various St. Louis companies. In 1918, he ended up as an advertising executive for Whistle Orange Soda, the creation of local businessman Vess Jones. But Grigg didn't get along with his new boss, so in 1919 he walked and started work on an orange soda of his own. He obtained funding for the new company from his friend Edmund Ridgway, who had made his fortune investing in mining. In 1920, Grigg launched Howdy—a lightly carbonated but very sweet orange-flavored soda. Although Griggs and Ridgway had built a network of nearly four hundred bottlers by the mid-1920s, Howdy struggled, overshadowed by the rapid rise of Orange Crush, a rival orange soda from Chicago. Orange Crush was booming on the back of doctors recommending orange juice as a source of vitamin C, because the soda contained orange juice rather than the essential oils of the fruit’s peel that were used in Howdy. Grigg found his beverage under attack from rivals for its lack of juice, and new laws forced him to label Howdy an orange-flavored drink rather than an orange drink. He hated the obsession with juice and pulp, and he refused to change Howdy’s formula “simply in order to line up with a pseudo-consumerist notion that the addition of orange juice makes a better product.”
But the market had spoken, and by 1927 Grigg had started searching for a new drink to make his millions. He settled on the idea of creating a lemon soda. As one of the simplest flavors around, lemon sodas abounded, with around six hundred brands on sale in the United States alone during the late 1920s. But Grigg saw opportunity in this fiercely competitive sub-market due to the lack of a market leader. Grigg spent months perfecting his new drink, eventually settling on a lemon and lime flavored beverage that fizzed more than the average soda.
The drink also harked back to soda’s origins in patent medicine thanks to the inclusion of a trace of lithium citrate. Although better known today as an antidepressant, lithium’s use in pharmacology only began after World War II. Lithium’s main medical use in 1929 was as an alternative to table salt in the wake of research linking salt with hypertension and heart disease. This ill-advised substitution would continue until evidence of severe side effects and deaths prompted an outright ban on the sale of lithium salts in 1949; the ban also forced the removal of the substance from Grigg’s drink.
But in 1929 this was all to come, and Grigg was keen to highlight the alkali metal’s presence in his new drink, so much so that he named his beverage Bib-Label Lithiated Lemon-Lime Soda. Someone must have had a quiet word, though, because shortly after its October 1929 launch Grigg changed the name to 7Up. Why Grigg picked 7Up remains a mystery, but there’s no shortage of speculation. Some stories say Grigg got his inspiration while gambling with cards or dice. Another claims he saw a cattle brand with the shape of a seven and a u, while another tale suggested the seven represented the number of ingredients and the up referred to the fizz. Whatever the reason, looking back everything seemed stacked against 7Up.
It had launched just two weeks before the stock market crash, and it still had to find a way to stand out from its hundreds of competitors. But 7Up had some advantages. For a start it had Howdy’s bottling network to tap into, giving it instant reach across America, and because the drink was lower in sugar than most sodas, it was cheaper to make, which made it an appealing option for other cash-strapped bottlers. It also successfully promoted itself as a hangover cure, running a “7Up for 7 hangovers” campaign that pitched the drink as capable of easing the effects of overdrinking, oversmoking, underdrinking, mental lassitude, overwork, overeating, and over-worry. After sales of 7Up syrup reached 5,920 gallons in 1930, the drink began a steady rise. In 1933 syrup sales topped 174,000 gallons before shooting up to 2,074,000 gallons a year by 1936, after Grigg’s post-Prohibition decision to start promoting his soda as a mixer that “tames whiskey” and “glorifies gin.”
As 7Up raced to the top of the lemon soda league in 1936, Coca-Cola was marking its fiftieth anniversary with a party for its employees. By then Jones’s fears about beer had subsided, and the flamboyant and towering Coca-Cola sales chief was convinced that Coke was here to stay. “There may be war,” he told the assembled Coca-Cola men and women in a tub-thumping speech. “We can stand that. There may be revolutions. We will survive. Taxes may bear down to the breaking point. We can take it. The Four Horsemen of the Apocalypse may charge over the Earth and back again—and Coca-Cola will remain.”