...Harvard Business School 9-898-171 Rev. December 11, 2000 Nantucket Nectars Well, we knew we were in an interesting position. We had five companies express interest in acquiring a portion of the company. Sometimes you have to laugh about how things occur. Tropicana (Seagram) and Ocean Spray became interested in us after reading an article in Brandweek magazine that erroneously reported that Triarc was in negotiations to buy us. (See Exhibit 1 for a copy of this article.) At the time, we hadn’t even met with Triarc, although we knew their senior people from industry conferences. We have no idea how this rumor began. Within weeks Triarc and Pepsi contacted us. We told no one about these on-going negotiations and held all the meetings away from our offices so that no Nectars employee would become concerned. It was quite a frenetic time. The most memorable day was just a few days ago actually. Firsty and I were in an extended meeting with Ocean Spray, making us late for our second round meeting with Pepsi. Ultimately, Tom and I split up: Firsty stayed with Ocean Spray and I met with Pepsi. Ocean Spray never knew about the Pepsi meeting. Tom and I have learned under fire throughout our Nectars experience, but this experience was a new one for us. —Tom Scott, co-founder of Nantucket Nectars Research Associate Jon M. Biotti prepared this case under the supervision of Professors Joseph B. Lassiter III and William A. Sahlman as the basis for class discussion rather...
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...Nectar Case Marketing 530 - Team 3 1. Is there any evidence that the program pays out for Sainsbury? Elaborate. * Nectar collected information on customers that helped Sainsbury’s to determine what stock to carry in which stores and to do more targeted marketing to customers. * Sainsbury’s had been losing market share, but after using Nectar’s rewards coalition their customers were spending more money than when they were using Sainsbury’s stand-alone points program. In fact, weekly spending was 40% greater at Sainsbury’s among people collecting points from the store and two other sponsors in the program. In addition, with each new added sponsor the amount spent at Sainsbury’s increased. For customers that earned points from 5 sponsors, their spending at the grocery store increased by 100%. * The benefit of using Nectar was to get customers to spend more per transaction and more frequently at the store, acquire customers that were customers of other Nectar partners, retain current customers, and up-sell customers higher margin products through incentives from the program. * The rewards program increased the competition for selling gas between Sainsbury’s and BP, but at the same time helped both companies take market share from retailers that did not offer Nectar points. * Conversely, though the majority of point were earned at Sansbury’s, there was a steady decrease in its importance throughout the year. Originally four out of five users redeemed...
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...1. Is there any evidence that the program pays out for Sainsbury? Elaborate. Sainsbury’s had been losing market share until partnering with Nectar and then became U.K.’s second largest supermarket chain after the first year of using the program. They also discovered weekly spending was 40% greater among people collecting points from several sponsors than only from Sainsbury’s. A study suggested that Sainsbury’s gained market share from non-Nectar retailers through gasoline sales due to the competition between BP and Sainsbury’s with Nectar. Sainsbury’s benefited from the Nectar program by: · Increasing the frequency of customer’s visits and spending more per transaction · Acquiring new customers · Retaining current customers · Up-selling to customers to buy higher margin products While Sainsbury’s was the dominant sponsor, there had been a steady decrease in its importance. In the launch month, four out of five collectors earned points from Sainsbury’s alone. Within six months, half had earned points from a second sponsor and at the anniversary 30% earned from one, 60% from two and 10% from three sponsors. Spending at Sainsbury’s was greater among collectors earning points from multiple sources than from Sainsbury’s alone. Weekly spending at Sainsbury’s was 40% greater when people collected from them and two other sponsors than from Sainsbury’s alone. It also became apparent that collectors who earned points from multiple sponsors...
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...program pays out for Sainsbury's in numerous ways. Nectar helped Sainsbury's acquire customers. For instance, Nectar customers who are not Sainsbury customers may have another supermarket close to their home, such as Tesco. However, because these shoppers have a Nectar card, they are more likely to travel further for their grocery shopping in order to obtain loyalty points for their Nectar card. Additionally, Nectar allows Sainsbury to target members who are not currently shopping at Sainsbury’s but live close by a location. Typically, the retailer would have a very hard time connecting these targeted individuals, and subsequently converting them to regular shoppers. However, since Nectar has their information in its database, Nectar can target them, yielding a much higher acquisition rate at a much lower cost. The Nectar network helps Sainsbury’s retain customers. Customers are more likely to be loyal to Sainsbury’s as a brand because they receive loyalty points in return for their purchases. Nectar’s loyalty program is more effective than a stand alone program run by Sainsbury. The weekly spending at Sainsbury’s was 40% greater among shoppers collecting from the supermarket and two other sponsors. Shoppers value the ability earn points at multiple retailers, and become loyal to those retailers in the process. Shoppers who participate in these sorts of programs are less likely to defect than a single-sponsor collector. Nectar provides invaluable customer and potential customer...
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...King should continue with nectar program . Nectar provides Sainsbury with valuable information about their customers that helps keep Sainsbury thriving : In other words * 2.9% raise in revenue Cost is dispersed amongst the partners * Increase in number of buyers due to a large number of partners Cons: * Costs more than 120 million pounds towards the loyalty program * Company is competing with partners on same commodities * Benefits sometimes get split due to similar offering by partners * No complete control over its nectar loyalty program * The amount of inactive collectors has increased from 0 to 12%, using it once then abandoning in it. * Sainsbury’s CRM may be stronger if they had their own loyalty program 2. What should Rob Gierkink do with the program to keep Sainsbury’s happy? Sainsbury’s advantages if it remains associated with the Nectar Program: * The program’s management is outsourced to LMUK, which allows its partners to concentrate on their own business * By having a share cost of multiple partners, the cost would be greatly reduced * It helps with the segmentation of its customers by analyzing their purchase across a section of different products which was purchased in many different outlets * Expand company to different countries where Sainsbury’s is not present * Award more points to Sainsbury's' customers when products are purchased Customer Advantages: * Nectar card holders will collect points...
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...1. Is there any evidence that the program pays out for Sainsbury? Elaborate. * Nectar collected information on customers that helped Sainsbury’s to determine what stock to carry in which stores and to do more targeted marketing to customers. * Sainsbury’s had been losing market share, but after using Nectar’s rewards coalition their customers were spending more money than when they were using Sainsbury’s stand-alone points program. In fact, weekly spending was 40% greater at Sainsbury’s among people collecting points from the store and two other sponsors in the program. In addition, with each new added sponsor the amount spent at Sainsbury’s increased. For customers that earned points from 5 sponsors, their spending at the grocery store increased by 100%. * The benefit of using Nectar was to get customers to spend more per transaction and more frequently at the store, acquire customers that were customers of other Nectar partners, retain current customers, and up-sell customers higher margin products through incentives from the program. * The rewards program increased the competition for selling gas between Sainsbury’s and BP, but at the same time helped both companies take market share from retailers that did not offer Nectar points. * Conversely, though the majority of point were earned at Sansbury’s, there was a steady decrease in its importance throughout the year. Originally four out of five users redeemed at Sansbury’s, but throughout the year...
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...Contents CASE BACKGROUND 2 NECTAR 2 Nectar Promotions: 3 SAINSBURY 4 Therefore the aim of this case analysis is to find out: 4 CUSTOMER REGISTRATION 5 TWO METHODS OF REDEEMING POINTS 5 COMPETITION IN THE UK GROCERY RETAIL INDUSTRY 6 COMPARISION WITH COMPETITORS 7 SITUATIONAL ANALYSIS 8 CONSUMER PERCEPTION OF NECTAR PROGRAM 8 SPONSOR PERCEPTION OF NECTAR PROGRAM 9 SHOULD SAINSBURY CONTINUE WITH NECTAR? 10 SHOULD SAINSBURY HAVE ITS OWN LOYALTY PROGRAM? 12 SHOULD SAINSBURY DISCONTINUE WITH THE CURRENT LOYALTY PROGRAM & DIVERT FUNDS TO NON-LOYALTY PROGRAMS 14 CUSTOMER LOYALTY PROGRAM IN FIJI 16 RECOMMENDATION 17 CONCLUSION 20 BIBLIOGRAPHY 21 CASE BACKGROUND NECTAR • The Nectar loyalty program is the largest loyalty program in Britain. • It was launched by Loyalty Management UK (LMUK and chaired by Air Miles co-founder Keith Mills). • Nectar opened for business in 2002. • With reference to various individual retail loyalty programs, Keith Mills,Gierkink, and further members of the LMUK team undertook the decision to search for an assembly of retailers who had their individual reward programs however were not content with their performance and could enhance their performance by combining with a multi partner loyalty scheme. • The initial four sponsors of LMUK were Sainsbury, BP, Barclaycard and Debenhams. Out of these sponsors, Sainsbury had its own regular shopper program which it discarded to join Nectar. Likewise, BP and Barclaycard...
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...FRUIT/VEGETABLE JUICE IN LEADERASIA HEADLINES * Fruit/vegetable juice grows at 11% in total value and 9% in total volume terms to reach $12.3 billion and 231 million litres in 2011 * Product and flavour innovations from leading manufacturers help add dynamism to fruit/vegetable juice * Juice drinks excluding Asian registers the strongest growth as a result of aggressive marketing and new products from Minute Maid and Tropicana Twister * Average unit price continues to rise due to increasing production costs and aggressive penetration of the super-economy segment * Coca-Cola (Leaderasia) Ltd leads fruit/vegetable juice with a 22% of-trade value share in 2011 * Fruit/vegetable juice is anticipated to see 6% CAGRS in constant value and volume terms over the forecast period TRENDS * Fruit/vegetable juice continued to show healthy growth in 2011 in both volume and value terms, helped by the ongoing health and wellness trend as well as aggressive marketing and product innovation in 100% juice and juice drinks excluding Asian. * Juice drinks excluding Asian registered the healthiest performance in 2011, backed by aggressive marketing activities and advertising for Minute Maid Pulpy from Coca-Cola (Leaderasia) Ltd and Tropicana Twister from Pepsi-Cola (LDR) Trading Ltd. Minute Maid Pulpy was more active than Tropicana Twister in terms of advertising and marketing activities in 2011. However, both manufacturers continued to stimulate strong...
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...show any substantial increase in total output although branded drinks do show a healthy improvement. There is no general acceptance of the product forms in the fruit drinks market. The consumer is basically concerned that it is a fruit juice and not a synthetically constituted product. Accordingly, the first segmentation is between real fruit drinks and synthetic drinks. The former are based on natural fruit pulp or juice. The others are synthetic products containing fruit flavours. Among the fruit juice beverages are fruit juices (Pepsi's Tropicana), nectars (Dabur's Real) and fruit drinks (Frooti and Slice). All these are real, reconstituted from fruit pulps or concentrates. The leading fruit juice brands include Real, Onjus, Tropicana, Frooti, Jumpin. The fruit drinks are mainly based on oranges, mangoes, pineapples, grapes, apples, guava and tomato. They only differ in pulp content: the juices have over 85%, nectars (20% to 85%) and fruit drinks (less than...
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...Hawaiian Punch “Go- To- Market Strategy” I would characterize the U.S fruit juice and juice drink market looks like very mature. The carbonated soft drink in the U.S. accounts for the most popular drink of choice among American consumers. The U.S. fruit juice and juice drink constitutes of 4.7 of the total 182.5 gallon of beverage consumed annually. These corporates four distinct varieties of fruit juice and juice drinks; 100% juice which may be either be 100% made from fruits or 100% made from concentrates. 100% juices form the largest share market with its share capital comprising of 54.9% of the total fruit drink and juice drink; the other is nectars which comprises of from 25% to 99% fruit juices and is manufactured from concentrated juices or fruit pulps. Nectar accounts for 6.1% of the total fruit juice and juice drink market; juice drinks that comprise of up to 25% juice and; fruit-flavored drinks which contains no juice content. Fruit-flavored drinks are the lowest ranked in terms of market share in the fruit juice and juice drink market with 5.3% of the total share. Eight companies distribute the most well-known brands in the U.S fruit juice and juice category. These are the PepsiCo, Coca-Cola Company, Kraft Food, Sunny Delight, Cadbury Schweppes, Welch and Nestle USA. Of all its competitors, Hawaiian Punch is a strong competitor forming 55% of the total sales. Consumers have confidence in Hawaiian Punch as the product has established a strong market base with...
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...Campaign Goals and Objectives Veggie Ville is in need of a campaign as the brand is new and it is to be launched in the market. To increase its brand awareness, revenue and market share. The company has numerous top competitors not only in the vegetable juice company but entire beverage umbrella. Fruit juices, vitamin water and flavor water. A main goal of the company is to increase brand awareness amongst our target market and inform them about the benefit of our new product. A second goal of the company is to increase its overall sales. This campaign will combine traditional advertising techniques like magazines, flyers, radio, billboards along with in-store activities and social media marketing. Market Information Market Profile The Canadian Fruit/Vegetable Juice off trade volume sales increased from 1,351.5 million liters in 2009 to 1,382.7 million liters in 2010. According to Statistics Canada the total number of people in 2009 who consumed vegetables/fruits 5 or more times per day were 3,92,1549. Minute Maid Co of Canada, a Coca-Cola company, leads sales of fruit/vegetable juice in Canada, with a total volume share of 16% in 2009 A Lassonde Inc is the second leading company in fruit/vegetable juice in Canada, holding a 16% value and a 15% volume share in 2009 By the end of 2014, 100% juice is expected to reach sales of C$2.6 billion and 1.4 billion litres in off-trade channels. Brand Profile Veggie Ville distinguishes itself from the...
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...|BUSINESS PLAN | |ESSENCES | |Vegetable Juice | |BBA 6 | [pic] Sehrish Inayat (090016) Sarah Masood (090014) Fatima-Tu-Zahara (090028) Tahir Ayub (090006) EXECUTIVE SUMMARY Juices consumption is high because of increased awareness of health consciousness among people. The competitive analysis identified that competition within the industry is high as the industry has some humongous names in it i.e. nestle, shezan, fresher etc. The application of Porter’s five forces to the Pakistani juice industry provides us a view of the potential attractiveness in terms of profitability of the industry. By doing PEST analysis we have learnt that although the political situation of the country is not satisfactory but the GDP and per capita income has increased and raised demand of FMCG’s. The awareness about health consciousness has increased a lot and people are accepting vegetable juices as a regular and healthy drink. SWOT analysis reflected that the industry is full of opportunities. In the end, the strategies for launching vegetable juices are quite similar which were used while launching fresher. The vegetable juices will initially be launched only in flavors that are commonly accepted by the public i.e. Celery, Spinach, Kale, Collard, Greens, Lettuce, Carrots, pumpkin, Cucumber and Mixed vegetable etc...
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...Nantucket Nectars Nantucket Nectars has captured America’s modern day lifestyle with its signature juices, quirky marketing, and intimate workplace. Tom and Tom’s huge success has drawn attention from bigger corporation such as Ocean Spray, Tropicana, Welch’s, Pepsi, and Starbucks. Nantucket Nectars should sign with Pepsi to keep the most control over their product and its image, allowing customers to still enjoy the item. Pepsi is a much better alternative to sign with because Tom and Tom would most likely have a better opportunity to keep up their current control of the company. Since Pepsi is not big in the juice market, it would allow Tom and Tom a lot of freedom in return for Pepsi’s entry into this market. Signing a contract with Pepsi that keeps upper management and main control with Nantucket is ideal. Pepsi can own a share of the company, but Tom and Tom can have virtual control over all other aspects in order to keep their company name and guarantee the same ingredients and quality that Nantucket has maintained thus far. Additionally, Pepsi is a worldwide name, allowing Nantucket Nectars possibly to reach a wider market of consumers. Pepsi could potentially provide a global market for Nectars. Pepsi would probably allow for the smoothest transition into a large corporation since Nantucket would make the most money and keep the most control under Pepsi. On the same token, Pepsi would want to acquire Nantucket Nectars as it would help increase its customer base...
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...Supply Chain Management Fruit juice- Dabur Nepal Pvt Ltd. Dabur Nepal has been producing fruit juice in Nepal for many years. The major fruit juices produced by Dabur Nepal are:- • Real • Activ The major raw material required to produce these juices are:- • Fruit pulp (orange, apple, mango etc) • Concentrated • Sugar • Water • Natural flavors The majority of the mango pulp comes from the India, while other fruit pulps like: - apple, orange, cranberries are imported mainly from Europe. Sugar and water are obtained from the domestic suppliers of the country. Beside juice productions, for other major products of the Dabur the major supplying companies are: - Orano, Doehler, LDC. In Dabur, the spices are imported from Indonesia, Glucose from china, and palm oil from Malaysia. In Dabur, the sales and marketing department forecasts the demand for fruit juices for coming 6 months. They use the system developed by SAP inorder to forecast demand and manage their inventory. RPP (Revolving Product Planning) is used to determine the market requirement once a month. Through this system they are able to determine what and when the raw materials are required. The SKU (Stock Keeping Unit) has the FG code for every item. Then the system determines the purchase requirement. After that the purchase order is placed by the company to their suppliers. After the raw materials are received from the suppliers, quality testing of the material is done. For the quality test, 5 days...
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...2.1 Micro-environments Micro-environmental analysis model used to analyze the internal business environment as. Company The company under analysis Atlantic Quench is manufacturing and distributing the fruit juices since 80 years in the US and now in the UK also. Atlantic Quench is famous for its Cranberry juices and dried Cranberry i.e. Crantanas. The company made the strategic alliances for its manufacturing and distributing of fruit juices with Gerber and Coca-Cola in 2013 and 2007 respectively (Ofori, 2013). The company has to buy raw materials at high price and unpredictable harvesting of Cranberry affects the share value of it. The company is famous for its canned and bottled juices and has introduced diet, white Cranberry and other flavored juices. Competitors The company Atlantic Quench has its competitor in its every field of work from manufacturing to selling of the product i.e. Fruit juices. In the UK, the consumers are health and diet conscious, so the company has larger market for its product range. The company faces cut throat competition in the UK with Tropicana, Rubycon and The ChagWorth Valley. According to the recent report about the Fruit juice and products, Tropicana is the leading brand with around 15% market shares in the UK (Elepu, Nabisubi, and Sserunkuuma, 2016). Customers Atlantic Quench has consumers in all the segments of the market, whether children, youth or adults. The people of the UK are health conscious so the company has wide market...
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