TEXAS A&M UNIVERSITY CORPUS CHRISTI
Case 1
Dr Pepper-Snapple Inc: Energy Drinks
MKTG 5320
Wesley Gordon
Introduction
In the ever changing world of customer needs and expectations Dr Pepper-Snapple was faced with an increased customer focus on energy drinks. This area, when exploited correctly, is a high growth and high margin beverage business. In early September 2007, Andrew Baker had his marching orders. He emerged out a long discussion about entering the energy drink business and off he went.
First let’s understand that an energy drink simply does as its title suggest, gives the consumer energy. This is accomplished most of the time with caffeine from a guarana bean. Some of the other players in this market
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This could be company strengths, current market penistrationpenetration, supplier agreements and simply all of the business and/or customer loyalties that they have had. Also in today’s market the consumers are looking for the “next new thing”. They no longer want an extension of what they already have. The consumers are loyal to a company, but can quickly change focus if a company fails to continue to change to meet their needs and/or demands for change.
3. Do nothing
Dr Pepper could always do nothing at this time. During the stand down they could evaluate mergers, joint ventures, or buyouts as they market strengthens.
Making a decision Given the track record of Dr Pepper-Snapple and looking at the SWOT analysis I feel that Dr Pepper should introduce an entire new product line. They can leverage their ability to manage a diverse brand business, the leverage they have in the RTD segment, and the strengths that the business as a whole has.
Implement the choice FDr Pepper has a great opportunity to penetrate the energy drink market. They could quickly take a major market share and continue to support the ever changing customer needs and ever changing expectations. The only remaining concept is how to do it.
1. Target Market Selection – Who is to be serviced needs to be determined. Target heavy users, all users, or even what age and gender to focus on.
2. Product Line and Positioning Choice – The product line itself has to be determined. Is it
For personal reasons, I’m extending my resignation. Please accept this letter as formal notification that I am resigning from my position as VP Procurement at Dr Pepper Snapple Group. My last day will be Friday, June 9th . During this time, I will work with you and other team members to ensure a smooth transition of my responsibilities.
Due to the fact that imitations for the product are being developed more rapidly, Ben & Jerry have changed their primary marketing goal to establish products that cannot be imitated, but the technological developments of the company have not allowed them to launch the products within a decent time limit. B&J 's mission statement includes the need for a wide variety of innovative flavors. Five years to find the perfect coffee bean seems unnecessary. Coffee ice cream, in this period, may have become undesired by the customer. This scenario is compounded by, the quick replication by competitors, and the high costs related to manufacturing each different flavor.
Now this has been some they have done over the years, however their time line does somewhat match up with a release or limited release of a new flavor and an increase of stock
According to its official website, Dr Pepper original and most well-known product is Dr Pepper with 10 flavors. The company also unveiled Diet Dr Pepper with several flavors with the aim of satisfying customers who seek out a sugar-free soft drink. Another well-known product is 7 Up, a lemon-lime flavored and non-caffeinated soft drink.
The analysis section will require me to evaluate each of the strategic options that we might have. I am going to layout the pros and cons for: heavy users, all energy drink users and the adult segment, as shown below in the appendices as figure 1-1. Single-serve energy beverage drink retail prices have generally settled at roughly $2.00 per single-serve package, regardless of size. As a consequence, larger single-serve packages are priced lower on a per-ounce basis than smaller packages. Shown in figure 1-2, it shows that our drink Rush NRG will need to come down a little bit in prices to be competitive and make margins meet.
11 Things You Might Not Know About Dr Pepper | Mental Floss. Retrieved from
It is the vision of Dr. Pepper Snapple Co. ‘to be the best beverage business in the Americas. Our brands have been synonymous with refreshment, fun and flavor for generations, and our sales are poised to keep growing in the future’(DR Pepper Snapple Group). The company has many objectives to focus on that will ensure their position as the leading flavored beverage company in the US. These objectives include enhancing leading brands, such as but not limited to, 7UP, A&W Root Beer to even the Dr. Pepper brand. In all of these brands listed there are spinoffs to each such as the brand featuring vanilla, cherry, limeade and much more. They are pursuing profitable channels like different packaging, and leveraging current business models to improve upon. The company is working to strengthening the route to market and also improving operational efficiency. Ultimately, this will contributed to their many resources that facilitate sustainability, in turn creating corporate social responsibility (DR Pepper Snapple Group).
Our success is fueled by more than 50 brands that are synonymous with refreshment, fun and flavor. We have 6 of the top 10 non-cola soft drinks, and 13 of our 14 leading brands are No. 1 or No. 2 in their flavor categories. In addition to our flagship Dr Pepper and Snapple brands, our portfolio includes 7UP, A&W, Canada Dry, Clamato, Crush, Hawaiian Punch, Mott's, Mr. & Mrs. T mixers, Penafiel, Rose's, Schweppes, Squirt and Sunkist soda. DPSG is a publicly traded company and they have done nothing but increase their value and please the stock holders since the beginning of DPSG in 2007.(MOVED FROM THE END OF ORIGINAL
By 1990s Snapple emerged as a nationally recognized brand.. With the combination of a unique product and package design and colorful advertising the company achieved nationally recognized brand. Later Snapple went through several management system and owners.
DPSG on the other hand has the brand loyalty, equity, image, and budget to support such a venture. It also has some unique qualities such as the addition of protein, a larger, re-sealable bottle, and an emphasis on performance over simply something to perk the consumer up. Since DPSG already has a target market, distribution network, and manufacturing set up, it could feasibly enter the market on the shoulders of its good name. The fact that DPSG has differentiated itself from the other brands also gives them a leg up. If it could successfully attract more consumers from the 35-54 year old range by riding its healthy image and promoting a healthier, more fulfilling energy beverage, it could that target market and become a great competitor.
Squirt soft drink is a caffeine-free, low sodium carbonated drink designed and created by Dr Pepper/7Up, Inc... This powerhouse drink is a wonderful creation of distinctive grapefruit juices, which gives it its fresh citrus taste. Due to its unique flavoring as a soft drink, Squirt is one of the best-selling carbonated drinks in the United States (Kerin & Peterson 2009) The key elements in Squirt’s advertising and promotional plan development begins with market targeting as well as product positioning, said Kate Cox who is the brand manager responsible for Squirt. This case study will provide a summary and analysis of Dr
Energy drinks are drinks that don’t contain alcohol, and often lightly carbonated. They are designed to give the drinker a burst of energy by adding of a number of ingredients, most notably caffeine. They are mostly found in grocery stores, corner stores and gas stations, usually displayed beside the soft drinks, juices and sports drinks. The study, published in the journal Pediatrics, reports that more teens are downing energy drinks; in 2003, 16% regularly consumed the drinks, while in 2008, that percentage jumped to 35%. Another study of college student consumption found 50% of students drank
Energy drinks refer to the beverage that contains caffeine in combination with other ingredients such as taurine, guarana, and B vitamins. And thus, it claims to provide extra energy to consumers such as improve their performance physically and mentally. For example, it would include promote wakefulness, maintain alertness, and provide cognitive and mood enhancement.
Other key marketing mix failures that affected Snapple in the Quaker era fall under the promotion and product umbrellas. Quaker did not follow regular advertising schedules, ceased Snapple’s partnership with Wendy Kaufman, and beside reducing the numbers of flavors available, was also unable to introduce new ones quickly enough. The started selling the product in larger sizes (32 and 64 ounces bottle), but this initiative was another flop: bottles of that size were suitable for Gatorade, not for a leisure beverage like Snapple, customers simply would not buy it. These choices elicited negative response in consumers who stopped perceiving Snapple as a funky and fashionable brand; the beverage’s healthy reputation was damaged too. It is rather clear that Quaker’s executives did not fully understand the Snapple brand and erroneously modified its marketing mix. This failure resulted in the rise of a deleterious discrepancy between the experiential value and benefits customers were used to and expected form Snapple, and the brand’s altered nature. In synthesis, Quaker tried to transplant a marketing mix and execution strategy to a recipient who was not suitable for it, and Snapple, its distributors, and its customers ultimately suffered from
The energy drink industry is a fairly new market, with the top products being little under 30 years old. There are several strengths, weaknesses, opportunities and threats in the sector that are unique to this particular industry. Through a SWOT analysis, I will analyze this markets’ main components.