Q1 i) Beverage market segmentation

1 – Geographic- It would involve the type of area, like plains, mountains, coastal areas, further
segmentation is done on basis of density in terms of urban, suburban or rural. Type of climate hot or
cold. For example in urban areas large packaging of 2 liters could have good consumption rate, while
in rural it might not, the choice of drink preferred in coastal areas can be different than the one
preferred in mountain areas.

2- Demographic- In demographic we consider variables like gender, age, income, generation, for
instance caffeinated drinks are not suggested for children here age becomes important, similarly
level of income in the area would decide in which price range to launch a product. For gender the
heavy consumption of bottled water was found to be slightly more by women than men.

3- Behavioural- Variables involved in behavioural segmentation include, decision makers like in

Q1 ii) who should Urzaa target?

Urzaa positioned it-self as an energy boosting drink without caffeine, hence there were no strict
restrictions for it to target a specific segment of consumer markets. It could be consumed by teen
agers, men, women, but its price did put some restrictions on its target markets, being in a premium
segment, it had to target urban rather than rural areas more, due to the presence of high earning
individuals and families. Unlike other energy drinks that were usually preferred to me consumed at
pubs clubs to mix in alcohol and by students’ wo needed to wake up long hours urzaa could be
consumed casually just like tea- coffee.

Q2 intended positioning at the time of conceptualization of URZAA

Ramesh was the main brains behind URZAA, as it is mentioned in the case it self that urzaa did not fit
into any category of functional drink segment, Chauhan wanted it to be an open game, he wanted to
craft out a new segment itself in the market, Urzaa was positioned as an energy boosting drink
without caffeine which could be consumed anytime by anyone because of absence of harmful
ingredients and no caffeine.

Positioning options for Urzaa

i) It could have been positioned as an energy boosting drink- The pros would have been that since
energy drink segment was going through a lot of changes, regulations on caffeine were being
imposed by the government, people were open to try new products, hence it was perfect time for a
new entrant, the other side of the coin would have been that with zero caffeine its energy boosting
claims would not have been upheld in relation to other products.

ii) It could have been positioned as a general health drink with vitamins which aided digestion- The
pros would have been that it could have been sold in a segment which did not have much

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 competition this would also have kept it open for other segments as well, cons would have been that
the premium price they were charging could have been considered high from a view point of general
health drink.

Q5- Do you think target volume for URZZA is achievable?

Firstly the target given by Ramesh Chauhan to sales team was 10% of Bisler’s annual sales, which was
240 million cans of URZAA in a year. We think that target volume was not achievable due to following
reasons.

i) It was an energy drink without caffeine so it would have not have proven good for those consumers
who were looking for an instant energy effect, as without caffeine that is not possible.

ii) The competition in the market was very intense, red bull had complied with the regulations set by
the government, hence its customer base was retained, URZAA would have to take a large chunk of
market from red bull in order to realize a revenue of Rs. 8 billion with a year of launch.

iii) The management, sales team, distributors and all were really under pressure as told in the case,
focussing on a new product while continuing the production, sales and distribution of the older ones
would have taken its toll on the staff.

iv) The product was not positioned sharply it was an open game, a new segment by itself, attracting
customers and setting the notion that stimulants like taurine and caffeine were not needed for an
energy drink was a difficult task as people had used other products and were used to them, the way
was to attract new consumers and retain them.

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