...Vitamin Water, Energy Drinks, other Beverages Case Study 2 The beverage industry has been rapidly growing for many years now. New products are being produced, as well as old products being refined. One of the largest markets thus far, beverages are continuously changing and being tinkered with. We look at a few different types such as, energy drinks, sports drinks, and vitamin-enhanced beverages. With different corporations comes different success factors. Some success factors for the beverage industry consist of rapid growth in category, premium prices, and high profit margins. Coca Cola and PepsiCo have been expanding on numerous different flavors, holding to the same products and production line. By expanding the “line up”, companies can expand their production, as well as profit and the business as a whole. “As consumer preferences shifted during the 2000s, sports drinks, energy drinks, and vitamin- enhanced drinks had grown to become important segments within the industry in 2010.” [Gamble C 76]. Noticing that most of the energy drinks are vitamin based, the growth of these products has been positive. Looking at Exhibit 1, we understand and can see the growth and volume sales over the years between 2005 and 2014. This chart pictures a constant growth based on the growth determined within prior years. The Five-Forces Model of Competition, is a key analytical tool in organizing a model based on buying and selling. The Five Forces are considered to be: firms...
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...MARKETING CASE NO. 1 DR PEPPER SNAPPLE GROUP, INC. ENERGY BEVERAGES Definition of the problem The Dr Pepper Snapple Group, Inc. senior company management has developed a corporate strategy to target high-growth and high-margin beverage businesses. The firm is the only major domestic nonalcoholic beverage company in the US without a significant branded energy drink of its own while this beverage market is the fastest growing category. Dr Pepper Snapple group needs to determine if a market opportunity exists to introduce its own, new energy drink brand. In order to effectively evaluate the benefits of entering the energy beverage market, the company needs to identify a consumer group where a favorable opportunity exists, and develop a brand differentiation strategy that effectively appeals to that market. Alternatives 1. The company may choose to remain inactive in the energy drink market. The company has a significant market share in the carbonated soft drink (CSD) segment and participates in other major beverage markets as well. The company achieves strong operating margins and stable cash flows from other businesses. Choosing not to enter the energy drink market is unlikely to impact the company’s performance in these other successful businesses. 2. The company may choose to introduce a new energy drink brand to the market. This alternative would expose the company to the fastest growing and fourth largest nonalcoholic beverage category in the United...
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...culture of consuming energy drink is not only for the western people but also for all over the world. The huge popularity of energy drink brands all over the world is instance. Bangladesh is a developing country. There are different companies who produce local energy drink. There is lots of energy drinks available in Bangladesh like as, Tiger, Red Horse, Speed, Shark, etc. All of these brands are approved by BSTI. But there are some international brands marketed by different companies. Some of them are Red-Bull, BOOST, BAKKAS, 3 Horses, etc. All of these brands are approved by Nuclear Power Commission of Bangladesh (National Nutrition Report, 2002). There is a huge market for energy drink. In today’s mass competitive market each and every company is facing tremendous pressure and challenges to create the brand image and retain the loyal customers. The proper utilization of marketing mix is better solution to the companies. Advertising is one of the best tools of marketing mix. For retaining customers and creating brand image, the full force effort of advertising is now successfully acting in the market. So, to know what is the impact of advertising on energy drink customers, what customers think, does it really works researcher this research. Entitled- ‘‘Advertising impacts on Brand Preference toward energy drink a study on Boost Energy Drink’’ 1.1 Importance of the study Almost all of the media are being used to provide advertisement by the Boost energy drink company (EMS international)...
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...world’s first energy drinks. Both of them contain caffeine and people have been using these beverages for year to receive an extra boost of energy for their day. I could remember my grandmother would wake up in the morning and the first thing she would do was to start to boil water for her morning tea. As a child I had no idea why she drunk tea. All I knew that if you added lemon and a bunch of the sugar to the tea, then it wasn't so bad. My grandmother was a local babysitter for the neighbourhood and the tea helped to give her energy for the day. My grandmother has passed away for years now but the idea of drinking something to gain energy didn’t pass with her. Tea and coffee has gotten a little out-dated and people today have adopted a new energy increaser, the energy drinks. The energy drinks as we know it today has gotten very poplar. From 2008 to 2012 the energy drink market has grown 60% (wallstreetinsanity.com). Energy drinks of today, besides coffee and tea, have been around for years. From it’s unknown origin, the energy drink has traveled around the world, and have gained substantial market shares in the functional beverage industry of several parts of the world. Europe is one of the largest functional beverages markets in the world. The energy drink has made a sizeable impact on the functional beverage markets in both western and eastern Europe. In this research project we are going to explore a number of objectives targeted to the impact of the energy drink on the european...
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...Introduction to Marketing (MKT333) Case Study #4 Red Bull GmbH is a privately-owned company based in Austria. Red Bull energy drink is based on the Thai energy drink, Krating Daeng (Thai for Red Bull), first produced in Thailand by the T.C. Pharmaceutical Company. The formula became popular as a tonic for blue-collar workers in Thailand. Red Bull Beverage Company Inc. became a subsidiary of the T.C. Pharmaceutical Company in Thailand in 1984 and Red Bull GmbH began marketing Red Bull in Austria in 1987. One millions cans were sold in Austria during the first year of production. The original formula was adjusted for “western” tastes adding sugar and carbonation. Its unique selling proposition was increased stamina and mental concentration relevant to its initial target market of long-distance truck drivers. Red Bull was introduced to the U.S. in 1997 focusing on four western states: California, Oregon, Texas, and Colorado. While the target appeal was initially to athletes, it soon became clear that Red Bull had a special appeal to young, white-collar workers looking for endurance for after-hours “clubbing.” The club scene developed Red Bull as a very popular mixer with vodka. Red Bull has expanded their product line from the original one can, one size, one label, one sticky-sweet liquid energy drink to Red Bull Sugarfree, Total Zero, Energy Shot, and most recently, Red Bull Editions. Red Bull Editions is their line of fruit flavored drinks which include cranberry, lime, and...
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...whether the drink should be positioned in the sport drink market or energy drink market. What's Going On? * Sarah Ryan, VP of marketing for PDB * Crescent Pure Acquisition * Need to position Crescent in the market * $750,000 for advertising * Desire to be first mover * Define: 10/1 Launch: 1/1 In the Beginning... * Peter Hooper, founder of Crescent * Organic Energy Drink * Started in Oregon * Michael Booth, CEO of PDB saw potential Why Crescent Pure? * 70% less sugar * Caffeine = 1 cup of coffee * Sold 1000 cases/month * $2.75 < $3.75 * Low calories * Energizing, hydrating, all-organic Options: The PDB Company needs to choose one of the following actions, in regards to its branding strategy: 1. To strategically position Crescent Pure as an energy drink 2. To strategically position Crescent Pure as a sports drink Sports Drink Pros of Sports Drinks 1. Consumers chose sports drinks more often. 2. The ingredients boost endurance and relieve fatigue. 3. Market is $6.3 Billion. 4. A high percentage of consumers considered sports drinks "anytime beverages." 5. A Study showed consumers favored Sports drinks over Energy Drinks for multiple factors. Cons for Sports Drink 1. The sports drink market is 2.2 billion dollars less then energy markets 2. Crescent's $2.75 sports drink is significantly higher then competitors prices 3. Concerns for sugary sports drinks have caused...
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...Energy drinks such as Red Bull, 5-Hour energy and Monster are the hottest-selling items of the beverage industry, but medical experts are concerned about the possible health hazards they pose and are on a mission for better regulation. The energy drink industry is doing very well looking at it from an economic standpoint. The industry has grown 60% between from 2008-2012, and had total U.S. sales of more than $12.5 billion in 2012, according to new market data from Packaged Facts. According to the “Energy Drinks and Shots: Market Trends in the U.S." report, sales of energy drinks and shots will grow to a value of $21.5 billion by 2017 (Energy drink sales). With this being said, the industry is facing many criticisms due to their health risk. Energy drinks are beverages with a high concentration of caffeine and other uppers. Some of the most laid-back regulatory requirements reside in the U.S. There are increasing reports of caffeine intoxication from energy drinks, and it seems likely that problems with caffeine dependence and withdrawal will also increase. They are sold in many places and are easily accessed by children, adolescents, and young adults. Many experts argue that this is actually their target market. Many reports warn about potential adverse effects associated with their consumption, especially in combination with alcohol among adolescents, and in combination with stimulant medications among children treated for attention deficit hyperactivity disorder. In children...
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...is difficult to grow without adding new products, specifically for smaller businesses. Research is needed in order to determine which products will be successful, and how to present these products to attract more customers. A popular beverage company is currently looking to add an energy drink to their selection. Their current beverage line includes a variety of sodas, sports drinks, water, vitamin water, and teas. In order to compete with other beverage companies they need to present something that will attract current energy drinkers, coffee drinkers, athletes, and sport fans. Problem Statement The beverage company has drinks in most classifications that compete with other popular drinks on the market. The organization is looking into the opportunity of marketing a new energy drink. When starting this process the company wants to know, “What matters more to consumers when purchasing an energy drink: taste, price, or duration of energy?” Research Purpose The goal of this research is to understand what consumers want from an energy drink. If the company can obtain this information, it will make things easier in the production process. The popularity of energy drinks on the market is increasing, and making it necessary to introduce a product that is unique in...
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...Energy Drinks: A Boost in The Wrong Direction Martin C. Okereke East Tennessee State University Introduction The use of energy drinks in the world today as a means of overcoming life stress and challenges, and its effects in humans after its long use and consumption has initiated the writing of this research paper. The importance of this paper is to create a level of awareness in the mind of people about the effects of energy drinks when consumed in large quantities, combined or mixed with other drinks such as alcohol, and taken amidst medical health conditions. There have been various questions regarding the use, effects and promotion of energy drinks. The use of energy drinks has been linked to so many factors which are not limited...
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...ISLS 4301 - Section 5 Energy Drinks Research By: Maram Balubaid, Rahmah Bukhary, Sara Al Akel, Haifa Al Akel and Basma Salah Energy drinks 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 at least one to four energy drinks a month. This year, research documented a jump in energy drink-related emergency room visits; and politicians and consumers called upon the Food and Drug Administration (FDA) to look into deaths associated with the drinks. So, what are the ingreadients that are causing this harm? * Caffeine Which is a stimulant that acts on the nervous system to speed up the messages to and from the brain. it is the main active ingredient in energy drinks . Caffeine can make a person feel more alert and it also has been shown to help exercise endurance. However, it can also have some negative side effects, such as heart palpitations and insomnia in case of overdose. (Laurent, 2000). There is no official recommended limit...
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...Practice Case 1: Dr Pepper Snapple Group, Inc: Energy Beverages 1. How would you characterise the energy beverage category, competitors, consumers, channels, and DPSG’s category participation in late 2007? Energy Beverage Category: Energy drinks provide consumers with a boost of energy and they fall under the category of functional drinks. Functional drinks are non-alcoholic drinks which include ingredients such as herbs, vitamins, minerals, amino acids or other nutritional ingredients. Other functional drinks include sport drinks, teas, fruit drinks and enhanced water drink. DPSG participation → In the US and Canada, Dr Pepper Snapple Group participated primarily in the flavoured carbonated soft drink (CSD) market segment Competitor: The largest non-alcoholic beverage category, after carbonated soft drinks, sport drinks, and bottled water, but the fastest growing one. DPSG participation → their major competitors include Red Bull, Monster Energy, and Coca Cola. Consumers: Average US per capita consumption of energy beverage drinkers increased by 14% since 2004. Predominantly consumed by males aged between 12- 34 during the afternoon or morning. The reasons for consumption include energy boost, mental alertness and taste. Most limit their options to 1.4 different brands which sheds light on strong brand loyalty. DPSG participation → DPSG have an attractive positioning within a large, growing, and profitable market. Channels: Distribution channels include convenience...
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...The claim for the article is that there is nothing special about energy drinks. The author of Energy Drinks Promise Edge, But Experts Say Proof is Scant supports the claim in many ways by stating various facts about the research done by experts on energy drinks. Such as the energy drink industry being in scrutiny by the Food and Drug Administration after various reports of serious injuries or even death that could very well be linked to the amount of caffeine in the drinks. The research that has been done on energy drinks always ends up leading to the conclusion that there are no real benefits besides a short burst of energy. Energy drinks tend to be very hyped up, like “Red Bull gives you wings,” and Rockstar is “scientifically formulated”...
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...------------------------------------------------- Re: Case Study No. 1 ------------------------------------------------- I appreciate this opportunity to assist you in this assignment and address the board with my findings. As per the assignment I have researched the following topic from the course materials. “Illness and death associated with the consumption of energy drinks”, and I have reached the following conclusions: 1. There are potential risks associated with energy drinks in children and adolescents 2. Sale of energy drinks has been debated and or restricted in various places 3. Many ingredients are understated and not regulated Within this memo I will explain my conclusions. I will be presenting my analysis in three parts. The first section addresses potential risks in children and adolescents. The next section about the debates and regulation of energy drink sales. The final section regards the ingredients that are understated or not regulated in some countries and states. Potential Risks to Children and Adolescents For my analysis I began by reviewing “Energy drinks 'potentially dangerous for children' say doctors. Energy drinks could be dangerous for children and teenagers, doctors have warned.” Found on www.telegraph.co.uk. As a responsible company we should be liable to research and warn consumers of the possible risks associated with the consumption of our products. “Energy drinks could be dangerous for children and teenagers,” The Daily...
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...unambiguous about the likelihood of Red Bull appearing on the stock market in the future, however. “Never. Thanks to our financial philosophy, we are not and never have been in need of additional capital, nor does anybody want to cash in. If we were to go public, the company would lose all of its benefits and in turn we would be left with numerous disadvantages,” he says. http://www.ft.com/cms/s/0/8733b030-de30-11e0-9fb7-00144feabdc0.html#axzz1nQrxHXt1 Some observers say that Red Bull's branding is revolutionary, calling it an 'anti-brand' strategy. The company faced additional problems in Pakistan where there were already many established drinks available. The firm avoided usual methods of marketing, relying more on what is called 'buzz marketing' or word-of-mouth. A brand image was created and cultivated which associated the drink with youth culture and extreme and adventure-related sports, such as motor sports, mountain biking, snowboarding and dance music parties. In other countries...
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...LTD). The energy drink market had been growing exponentially; but in the recent years growth has been decreasing. How can energy drinks cope with a dwindling market place? Along with dwindling growth, competitors Red Bull and Rockstar have to deal with smaller startup companies trying to steal market share. This report will analyze market share reports from Snapshots International LTD, as well as many other sources. One company that wasn’t even on the top 5 list in 2005, Monster, is now the second biggest competitor in the market place in 2009. Is there a correlation between energy drinks that sponsor sports events or more of a correlation to sponsored athletes? This report will also examine Price, Place, Product and Promotion that Red Bull and Rockstar use. There is a 50/50 split with energy drinkers and non drinkers alike, how can energy drinks expand their sales outside of the energy drink market. This report will also analyze results from Google trends which shows a graphical analysis of search hits. Along with secondary research, this report also includes a primary research section. Included in this section is a survey posted to Survey Monkey.com. With 100 respondents this survey finds out the primary concerns and preferences of energy drink consumers and non-drinkers as well. Broken down within this section are results from Red Bull drinkers, Rockstar drinkers, non-drinkers, as well as those who drink energy drinks only 1-2 times per week and those who drink energy drinks...
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