Though Coca-Cola (NYSE:KO) has delivered stock appreciation for the past three years, it has consistently underperformed PepsiCo (NYSE:PEP) in the same time frame. For instance, while Coca-Cola has seen stock appreciation of 32% in the past three years, PepsiCo has seen stock appreciation of 36%. This isn't a big difference, but if you look at the past year, Coca-Cola's stock has appreciated 11.7% while PepsiCo's stock has appreciated 21%. Coca-Cola has also underperformed Dr Pepper Snapple Group (NYSE:DPS) for the past three-year and one-year time frames. Dr Pepper Snapple has seen stock appreciation of 40% in the past three years, and it barely squeaks by Coca-Cola in the past year, with its stock appreciating 11.9%.

Are these stock performances fair when related to underlying business performances? And if so, what does Coca-Cola have in store to alter this trend? 

Coca-Cola lags on the top line
A decade ago, nobody thought Coca-Cola could be struggling on the top line. It was, and still is, one of the most powerful brands in the world. And it's still extremely profitable. However, if you take a look at top-line performance comparisons between Coca-Cola, PepsiCo, and Dr Pepper Snapple for the past year, you will notice a concerning trend:

KO Revenue (TTM) Chart

Coca-Cola revenue (trailing-12 months) data by YCharts

That's why Coca-Cola must innovate in order to thrive again. It does offer its own brands that target the health-conscious consumer, including Dasani, Vitaminwater, Simply, Odwalla, Coca-Cola Light, and Coca-Cola Zero.

Coca-Cola has recently added another brand to go along with the last two on the list above. You probably haven't heard of it because it's being launched in South America, and it might be launched in Europe in the near future. It's possible that it will hit the United States in the distant future, but that remains to be seen, and this would only happen if the brand saw great success in other regions of the world. While it's too early to tell if this mystery brand will deliver strong sales, one key indicator hints that it will.

New life
Coca-Cola's new brand is Coca-Cola Life. It has already been launched in Chile and Argentina, and the ad for the brand has gone viral online. This, of course, will immediately lead to strong brand recognition as well as the likelihood of sales beating expectations. If you would like to watch the viral ad, it will only take up one minute and one second of your time:

The marketing campaign for the brand is focused on life and the joy and pain that goes along with parenthood. Coca-Cola put five years of research into the product and a marketing angle, so it's good to see that the company's hard work has paid off.

As far as Coca-Cola Life targeting the health-conscious consumer, it only has 36 calories per 200 ml, and it's sweetened with stevia and sugar as opposed to aspartame. The goal is for Coca-Cola Life to appeal to people who want to consume a healthy and refreshing drink without sacrificing the sweet Coca-Cola taste. Based on early results, such as an ad that has already gone viral, I would put the brand's potential success as high.

The Foolish bottom line
Contrary to what some people believe, Coca-Cola isn't suddenly going to fade into oblivion. This is a company that generated $10.5 billion in operating cash flow in the past year. Therefore, it has more than enough capital to support its wide range of brands via effective marketing, and it has the ability to innovate at a relentless pace.

Nobody knows if Coca-Cola Life will be the company's next big hit, but it demonstrates the company's ability to innovate and market effectively. This trend is highly likely to continue in the future, which may make Coca-Cola a big winner in the future. 

Dan Moskowitz has no position in any stocks mentioned. The Motley Fool recommends Coca-Cola and PepsiCo. The Motley Fool owns shares of Coca-Cola and PepsiCo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.