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Beverage Positioning Strategy

Sarah Ryan must finalize a product positioning strategy for Crescent Pure, a new non-alcoholic beverage, ahead of its launch in 3 US markets. Crescent Pure was acquired by PDB due to its organic, energy-enhancing ingredients which complement PDB's existing organic product line. Ryan must choose between positioning Crescent Pure as an energy drink or sports drink. Positioning it as an energy drink could capture a large market share but competition is intense. Positioning it as a sports drink has a wider consumer base but slower growth. Ryan will recommend a positioning strategy considering factors like the total addressable market size, drink characteristics, brand fit, price, competition, demographics, and communication requirements.

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148 views4 pages

Beverage Positioning Strategy

Sarah Ryan must finalize a product positioning strategy for Crescent Pure, a new non-alcoholic beverage, ahead of its launch in 3 US markets. Crescent Pure was acquired by PDB due to its organic, energy-enhancing ingredients which complement PDB's existing organic product line. Ryan must choose between positioning Crescent Pure as an energy drink or sports drink. Positioning it as an energy drink could capture a large market share but competition is intense. Positioning it as a sports drink has a wider consumer base but slower growth. Ryan will recommend a positioning strategy considering factors like the total addressable market size, drink characteristics, brand fit, price, competition, demographics, and communication requirements.

Uploaded by

rakesh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Crescent Pure

Manufacturer of Orange Juice and Sparkling Water


Case from Sarah Ryan perspective- VP Marketing Portland Drake Beverages
She has to finalize on product-positioning strategy for recently acquired Crescent Pure a non
alcoholic beverage functional beverage with impending launch in 3 markets of US
Why acquire Crescent?
It was :
Energy enhancing, hydrating and all-organic ingredients
Made it natural extension to PDB’s existing organic product line
2 Positioning challenge:
Energy ehancing ingredient – Energy-drink positioning
Hydrating element – Sports drink positioning
Ryan also pondered on 3rd positioning strategy:
Healthy and organic roots

Competition was launching all natural version of sports and energy drink positioning product
in market by 2015
PDBs had production capacity constraint which prevented them to launch fully in the market
only to delay it till 2015
So they decided to have a soft launch in 3 markets which comprised 15% of national beverage
functional demand

Task in hand: Micheal Booth CEO of PDB tasked Ryan with positioning strategy.
PDB planned to spend $75,000 on advertisement for the soft launch. If the profit is more than
this they would go with national launch in 2015
1. Industry specific related to each of posititioning option
2. Potential benefits and drawbacks of each option
3. Recommendation
US beverage Industry Non- Alcoholic
Water, Dairy, Juice Soda and functional beverages
$131 bn projected to grow to $168 bn by 2018

Distributors: Key contributor in selling process


Distributor’s cut: 25%
They continually refined their catalogue to include products which they believe would
generate highest demand

Retailer’s margin : 40%

Crescent Pure : History


Peter Hooper saw market opportunity for : Healthy, energizing drink
Popular energizing and performance enhancing drinks: unhealthy, too sweet, and artificial

Crescent pure : Organic, all natural , herbal stimulants, and electrolyte


Ingredients:
Herbal stimulants ( Guarana Seed and Gin seng) delivered 80 mg of caffeine which gave 50%
of energy as compared to market leaders product
Sugar quantity in Crescent was 70% less than competitors
The business grew in the area owing to demand for heathy, organic, energy drink

Cost Crescent: 1 case = 24 cans yearly cost


3 distributors: @ $34,000 /month/distributors
Production: 12,000 cases per month
Retail price: $2.75 / can
Variable cost: $ 1.02 /can
Distributor cost: $1.24/can
Positioning Strategy options:
1. Energy: Survey in Oregeon
“Energy” as Crescents most descriptive characteristics
Prize for drink in US – 2- 5 $ (based on size and retail) avg price for 8 oz bottle is $2.99 above
our 2.75

Avg Our Target Competition Threats


Positioning Cos cost Marke
t t size
per
can
Energy 2.99 2.7 8.5 bn 18-24 Higher 85% Trend shows
5 growth revenue decreasing intake
shared due to media
between 5 showing health
players risks
Sports 1.5 2.7 6.3 bn Wider Advertising 94% shared
5 consume has to between 2
r base build the players
than case for
energy. higher
But price
slower
growth

What factors influence the positioning of Crescent pure?


1. TAM: Market potential calculate, Market growth, Consumer Perception (Sentiment for
Energy vs Sports drink) /Sentiment / Buying capacity of individuals
2. Drink Characteristics: (Product Market Fit)
4. Brand Characteristics – Product Brand Fit
3. Price:
4. Competition
5. Demographics
6. Communication ease / Ad budget??
7. Market Gap
8. POD

Energy
Pros

 S
Cons

Energy:
Pros:

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