TOWS Development
November 5, 2013UncategorizedGroup
Threats
1. Competitors ( e.g Tesco using their own brand)
2. Possibly some marketing restrictions from the ASA or the European Union. (for making unproven claims such as calling their products “superfoods” without backing it up by any medical science)
3. Recession/economy slowing down/ consumers spending less money in supermarkets
Opportunities
1. They could improve their brand by making their own store (juice bar)
2. Being mostly owned by Coca Cola creates many opportunities to operate internationally
3. Government and the EU passing legislation to promote healthy food/drinks
Weaknesses
1. High price
2. Do it yourself (People making juice themselves because it is much cheaper)
3. Allergy to certain fruits
Strengths
1. Being known as a friendly environmental company (Good Reputation)
2. Widely known brand (Majority of the market)
3. Seasonal Products (Innocent Big Knit)
4. Wide range of products
Threats and weaknesses
1. Innocent can manage their threats and competitors by lowering their price of products as they higher than supermarkets using their own brands such as Tesco. Also during the recession they could make extra promotions to make it more affordable their consumers.
2. They can use the advantage of convenience when facing DYI products. Also promoting them as a healthy company that operates with government schemes could boost their sales even though their prices seem higher.
Weaknesses and opportunities
1. Market diversification is a risky venture and establishing a juice bar could potentially fail, losing them money.
2. Coca-Cola are known for their aggressive marketing strategies which may compromise Innocent’s values as a company.
Strengths and threats
1. They could use their strong environmental image to outcompete their competitors. This can be done by campaigns/promotions raising awareness and convincing consumers why their products would be better for them or e.g their children.
2. By offering a big range of products or being to provide products at the reasonable price to the current economic client they will be more successful during different cycles of economy.
Opportunities and strengths
1. They could use their brand which is well known in the UK to open up their juice bars.
2. By having big range of products they will be more likely to break into new markets.
3. Innocent as a company providing healthy products and supporting the environment will benefit from the polices made by the government or the EU which then can be used to strengthen their position in the market.
Development of the TOWS
Weaknesses
1. High prices mean that competitors drinks look both cheaper and more attractive to potential consumers, as they will not have to have such an outlay to get the drink they want. One reason this is such a weakness is because innocent drinks are stored in the same place as soft drinks in shops. This means that when comparing prices, a consumer will look not only at other juices, but take into account the prices of less healthy, but cheaper soft drinks
2. The fact is that innocent make smoothies and juices which are easy to replicate as an individual, all you need is a blender and some fruit and you can have what you were going to buy for £2 for more like£0.20. There are of course extra benefits being the fact that innocent is bottled and has some form of preservative in which means you don’t have to drink the whole thing immediately. And the obvious fact that it is very quick and easy to buy a smoothie compared to going to the shops to buy fruit then coming home and blitzing them into a smoothie.
3. Allergies cannot be avoided really, you are in the food and drink industry, there are always going to be people with allergies to certain things and all you can do is do market research into each fruit in your drinks and find out which the majority of people are allergic to and then decide whether or not to include it in your drinks
Strengths
1. Being known as a friendly company is a strength because it appeals to people with that kind of mind set, whilst not alienating those people that don’t. You can make yourself look like a good, clean and environmentally friendly company relatively cheaply, and it will only increase your revenue.
2. The fact that the top smoothie brand in Europe is innocent is a strength to the company because as you hold a majority in the market you can push out competitors. Being a monopoly, allows you to price fix at a price smaller, less well off, companies can charge.
3. Seasonal products are easy for an industry such as the food and drink market to stick to. Whilst brands like CocaCola and Pepsi just do more seasonal marketing, innocent can change the product itself, using seasonal fruits/vegetables. Eg. Christmas smoothies using cranberries
4. A wide range of products is such a big strength for a company such as innocent. It allows them to compete is many different markets, from the smoothie, to the juice to the snack market with all their products. This allows for a thicker revenue stream due to selling more products.
Threats:
Competitors are one of the major threats for Innocent, as the fruit juice market has been very successful for companies such as Innocent other companies such as Tesco realised an opportunity. They are very to compete with because Tesco is a global organisations that afford putting lower prices on their fruits and still make profit. When competing Innocent need to pay special attention on what products their competition provides and at what cost. If the competitors are getting ahead of Innocent and this is not recorded they will lose their market share.
Marketing restrictions made by the ASA and the European Union is one of the threats that Innocent has to face while marketing or labelling their products. There have been several legislations passed by the EU which requires Innocent to obey them. Innocent cannot state information or description that is considered misleading. So when labelling their products Innocent need to list all of the ingredients, the country of origin or the date of minimum durability, therefore Innocent need to be very careful when advertising their statements because if they are not justified they can be sought.
EU Legislation, Labelling of foodstuffs, Available from: http://europa.eu/legislation_summaries/consumers/product_labelling_and_packaging/co0019_en.htm[Accessed 30 October 2013]
Another threat that Innocent and all other companies have to face is changes in the economic climate. During the recession companies experience decrease in sales which then can badly effect on operational activities of an organisation, so for example if Innocent would not cover their costs because the number of sales decreased they would go into debt or even go bankrupt. Forecasting slowdowns in economy is essential because then Innocent can be prepared and make necessary strategic decisions, for example less spending and investments.
Opportunities
They could improve their brand by making their own store (juice bar). So far Innocent is selling their products in the main supermarkets such as Tesco or Sainsbury however if they decided to create their own stores it would boost their profits because they would produce and sell products themselves but also it would enable them to strengthen their brand. It also creates other opportunities such as providing new products or possibly services in their stores.
Being mostly owned by Coca Cola creates many opportunities to operate internationally. Coca-cola is one the most powerful brands around the world and the market leader of selling soft drinks. Instantly this can benefit innocent as they will have more power and money to invest into new markets. Also experienced board of directors can positively influence their strategic decision which increases the chances of being successful in another country.
The Britvic Soft Drinks Report 2012, Available from: http://www.britvic.co.uk/~/media/Files/Media%20Centre/Reports/Soft%20Drinks%20Report%202012%20Final%20Proof.ashx [Accessed 30 October 2013]
Government and the EU passing legislation to promote healthy food/drinks is another opportunity for Innocent to use their brand known to sell healthy products to boost their sales and attract new customers. The UK government wants to raise awareness of how many people are obese in the country and therefore try to encourage people to buy products that do not contain sugar. Innocent has an advantage of already providing healthier products and they can use it in their promotions to keep growing.
UK Policy. Reducing Obesity and improving diet, Available from:https://www.gov.uk/government/policies/reducing-obesity-and-improving-diet [Accessed 30 October 2013]
Weaknesses and threats
1. Innocent have a high value product, based on expensive fruits from natural sources, meanng that their pricing is inelastic. If they change the price of their products to match the own brand versions that Tesco make (for example) during the recess, they may find that consumers value their products less and aren’t willing to pay premium prices for their smoothies in the future.
2. They can use the angle of convienience when looking at the cmopetition they have with consumers making their own smoothies at home to save money. Pre-bottled smoothies are easier to drink, have little to no mess and don’t require the consumer to own/buy a blender to make the smoothie, nor does the consumer have to buy the fruit (which may go off before use), meaning that the bootled smoothies that Innocent provide are much easier to get access to than DIY smoothies.
Weaknesses and threats
1. Market diversification is a risky procedure which involves a company branching out into a new market with an existing product with little to no gaurantee of success. Innocent have established themselves as a pre-bottled supermarket stocking smoothie company, meaning that there is no evidence to suggest that a seat-down-and-drink style café which servers only innocent smoothies will work due to the difference in convinience levels for the consumer.
2. Innocent have established themselves as an economically friendly, consumer focused company which provides healthy drinks to their consumers. Coca-Cola are known as an aggressive marketing company that promote their products constantly. Coca-Cola’s investment of £30m into the company is a potential threat to Innocent’s values due to the fact that they may have to compromise some of their values to accomodate for Coca-Cola’s strategies, reflecting badly on the branding of Innocent which could in turn harm their sales.
Strengths and threats
1. Innocent could use their strong environmental image to remain competitive. This can be done via campaigns and promotions that will raise awareness and help to convince customers why innocent are helping the environment more than their competitors. For example own brand products from supermarkets such as Tesco will not be considering the environment when they are packaging their smoothies whereas innocent have put a considerable amount of thought into the packaging and the effect on the environment. They can create awareness of how they are determined to create an environmentally friendly and sustainable business.
2. By offering a wide range of products or being able to market the products at a reasonable price according the current economic climate, they are likely to be more successful during different cycles in the economy. For example in the economic downturn innocent will struggle as they are marketing a high end product, however if they reduce the pricing it may be a threat to the image of the brand.
Strengths and opportunities
1. Innocent could use their strong brand image within the UK to open up juice bars. This would be a good opportunity for innocent as they already have a very popular brand image and would be able to compete with juice shops such as boost.
2. By expanding their range of products innocent will be more likely to break into new markets. Innocent have increased their product range for example from smoothies into fruit juices to compete with Tropicana who dominate the fruit juice market in the UK.
3. Innocent as a company provide healthy products and being supportive of the environment will benefit from the policies created by the government and the EU which can then strengthen their position in the market.
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Critical success factors
November 5, 2013UncategorizedGroup
The critical success factors are those which help the business acheive their corporate objectives. Each member of the group has contributed two ciritcal success factors to the marketing auidt.
1. A key critical success factor for innocent is its healthy products; they promote government policy and the company’s image. As the UK are endorsing ‘Healthy eating’ this is beneficial for Innocent as their smoothies are healthy as listed by their ingredients (Innocent, 2013). “Health remains an issue within the soft drink category with potential to drive value sales in the market. For example 3 in 5 smoothie drinkers agree they are willing to pay more for a drink with higher fruit content. (Mintel)
2. Another critical success factor is by being sustainable as a company by caring about the impact of society and the effect on the environment. “We strive to do business in a more enlightened way, where we take responsibility for the impact of our business on society and the environment, aiming to move these impacts from negative to neutral or (better still) positive. (Innocentdrinks.co.uk) The business can use their image of being sustainable to market themselves in a more positive light and potentially increase sales.
3. The Use of Public Events to spread their brand and product image is on critical success factor for innocent. A good example of this would be the London 2012 Olympics, where 8.8 million tickets were sold, and innocent where named the “Official smoothie and fruit juice of the London 2012 Olympic and Paralympic games
4. Partnership with Coca Cola – another critical success factor that has allowed innocent drinks to grow as a brand. In 2010, CocaCola purchased a 56% stake in innocent drinks, this was increasd in 2013 to a 90-99% stake. This much ownership by a company as large as CocaCola, means that there would be more money available to all departments of he company for investing. The partnership also helped innocent because of CocaCola’s affiliation with the London 2012 Olympics.
5. One of the main critical success factors is the strong green image that the company has, their is an oppourtunity for innocent to improve their brand image by promoting the fact that they care about being sustainable. Innocent can use this opportunity to help inform their consumers about on going social and environmental problems and to show how the company is taking action to help.
6. Another critical success factor is their branding and particularly with their recent partnership with Coca-Cola. They need to be careful in that their core values as a company (healthy, real fruits, natural ingredients) aren’t compromised by the objectives of Coca-Cola which would lesser their image with the public and could potentially reduce further sales due to a consumer boycott of their products in retaliation to these changes.
7. The final critical success factor is that of survivability in the market due to the recession. Innocent currently sell a premium range of products in a market suffering from financial hardship, which could lead to reduced sales. Innocent need to consider the sensitivity of their pricing and the price the customers are willing to pay to ensure that their products don’t fail on the market as it currently is and force Innocent to slow/halt production.
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Evidence of successful group working
November 5, 2013UncategorizedGroup
As we were late forming a group, we had a meeting with Dr Sarah Maddock on the 23rd of October to form a group. We then signed a group contract, swapped contact details such as email addresses and phone numbers and signed the contract. After the contract had ben signed we split the work load into 2 sections: Macro and Micro analysis, which was then split between the four of us. We decided as a group that Tom and Rachel would do the Micro analysis side of innocent smoothies while me and Alan would do th Macro side.
Tom and Jamie agreed to split the workload of the infographic in half, where Tom posted that micro analysis sections that him and Rachel worked on and then Jamie posted the macro analysis parts and finished the design, completing the inforgraphic. The inforgraphic work was equally divided and worked out as a 50/50 split between Jamie and Tom.
We arranged a group chat on Facebook to swap information when we weren’t metting physically, allowing us to quickly contact anyone in the group in regards to certain sets of information such as access accounts for the group blog, allowing each member to log in and post their own posts (which then failed and we now use a neutral account).
We met on November the 4th at 2pm in 4D29B in person to work on the assignment and ensuring that the project was finished before the deadline as we were already on a tight schedule due to forming as a group 3 weeks late.
We then met on the 5th of November at 4pm in room 4D29B (library) to finalise the blog posts and collect all of the information, leading up to the handing in on the evening.
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Futher Micro analysis of innocent drinks
November 5, 2013UncategorizedGroup
Public Events
This is an area where innocent drinks are really allowed to spread their brand image to the public. One such public event where the London 2012 Olympic games. An opportunity handed to innocent by their 56% (at the time) stakeholder, Coca Cola. They were named “Official smoothie and fruit drinks brand of the games” which increased the global awareness for innocent drinks. Influence of other brands on innocent drinks
At this point in 2013, Coca Cola has a 90-99% stake in innocent drinks as a brand. This has both its obvious strengths and drawbacks. One of the biggest reasons why it is a good thing for innocent is the fact that with a company as large as one like CocaCola, there is so much money available for reinvestment. This could be investment into new production, reaserch and development, or something as simple as marketing and advirtising. One of the reasons why this marriage might be considered a bad thing wuold be that, innocent drinks are trying to market themselves a healthy company, one with smoothies and juice drinks that are more healthy than their competitors. So being very directly linked to a soft drinks giant such as CocaCola – known for the sugaryness of their bevarages, and so at a juxtaposition to innocent drinks – might not be the best for public image. This fact is only heightened by the % stake Coke actually holds in innocent drinks, what was 56$ in 2010, skyrocketted to around 90-99% in 2013! innocent is a registered charity innocent gives grants to NGO’s (non governmental organisations), with the idea of briging nature and communities closer together for mutual benefit. Facts:
 innocent doubled its turnover from 2008 to £209m in 2012 and is the top smoothie brand in Europe
 The government’s push on healthy eating over the last few years really helped innocent in their early years.
 Higher awareness of healthy eating will increase consumption of healthy beverages and food, and therefore is likely to increase innocent’s market share

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Macro Analysis – PESTLE
November 5, 2013UncategorizedGroup
Macro analysis – PESTLE
Political/Legal
Political and legal factors are closely linked together. It is essential that soft drink companies keep special care on any new legislation passed by the government or the EU. This is because they can either benefit from them or lose huge amount of money. So for example Government encouraging people to eat/drink healthier will have a positive impact on the fruit juices. In the other hand the EU have passed a legislation in 2009 which prevents companies from making unproven statements while marketing. For example calling their products “superfoods” or “the best drink in the world”. Therefore companies will have to really carefully plan their marketing strategies or they can lose money in court.
Economic
Soft drink industry is hugely influenced by the economy in they country they operate in. During the recession soft drink products have experienced big loses and still struggles to regain their market strength. In the other hand once the economy starts to recover there is opportunitiy for companies to make more profit which is currently happening in the UK. In addition during different stages of economy cost of raw materials or even petrol (used to transport products) can be very different.
Social
Social factors are very important for the soft drink industry because these are the consumers who bring money for the company. An example of how it can be used is that older people tend to be more healthy cautious and avoid products containing sugar. Using people well known in the society to promote their products can be really valuable for any company, for example David Beckham endorsing Pepsi. Another important reason is that in most “Western” countries people suffer obesity so therefore there will be more impact on drinking products that containing less sugar.
Technological aspects can be very beneficial for the companies. An example of this is that the latest technology can be used to produce their products more efficient within shorter period of time. In addition it will be easier to get in touch with more consumers through the internet or their smartphones (apps). We can also notice that machines/computer have been replacing stuff which means less operating costs. (Increased productivity.
Environmental factors play a big part in the soft drink industry as consumers who buy fruit products rather than “unhealthy” fizzy drinks are more likely to look at the environmental aspects. So therefore companies recognise that in order to attract more consumers they will have to become more environmental friendly. While producing their products and transporting them to the stores they produce huge amount of carbon footprint. Companies can reduce their emission of carbon by using machinery/transport that produces less carbon or they can make their strategy to source products locally rather than importing them from overseas. There are also pressure groups that can have a big influence on a company’s reputation so they would have to consider having good relationship with them by, for example producing packaging than can be easily recycled.
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Mirco analysis of Innocent smoothies
November 5, 2013UncategorizedGroup
I have considered a number of factors when analysing the mirco environment of innocent smoothies, these include their competitors, buyers, suppliers and intermediaries.
Competitors- Innocent faces the dual threat of a consumer downturn and the effects of a bigger rival to force them out of business. Innocent has been forced to contend with the entrance of PepsiCo into the market, one of the food and drink industry’s global giants. (Telegraph.co.uk)
However innocent smoothies have remained competitive by launching an orange juice that contends with Tropicana.
“It gives us an opportunity to dramatically widen the demographics of the brand. A litre of smoothie is £2.99; a litre of orange juice will be £1.89. People can buy the innocent ideals at a lower price point. (telegraph.co.uk) statement from Richard Reed co-owner of innocent.
Another of innocents main threats include leading supermarkets own brand products that are cheaper. Also premium high street brands such as Waitrose are introducing own label products at competing prices (Mintel)
Heavy discounting has failed to arrest the decline in the smoothie market with consumers continuing to switch to cheaper alternatives such as fruit juice. As a result the market declined by 36% between 2007 and 2009, following strong growth (+159%) between 2005 and 2007. (Mintel)
Coca colas investment in innocent should provide the brand with distribution scale to improve margins while maintaining price competition.
Innocent dominates the market for smoothies accounting for 80% of all value sales despite having a torrid time over the last few years. (Mintel)
Last year innocent had to fight off competition from two rival products, PepsiCo’s Tropicana and nestles boost, which caused annual sales to fall for the first time. Although its share of the UK smoothie market fell as low as 50%, it has since recovered strongly to reach 83%. (Theguardian.com/business)
Buyers
The customers of innocent are attracted to the products because of the healthy and nutritional nature of them. Innocent appeal to customers by promoting the fact that their smoothies are made with 100% real fruit. “Our 100% pure fruit smoothie, no added sugar, no concentrates no funny business”. (innocentdrinks.co.uk)
Smoothies have been damaged by negative publicity around their health credentials, such as damage to teeth and high calorie intake despite scientific evidence to the contrary. However smoothies are still seen by consumers as a healthy product and the drive to ensuring kids have a healthier diet is playing to their advantage. Innocent need to focus on advertising the health benefits of their smoothies to retain and attract customers. (advertising.microsoft.com)
Suppliers
With the investment of coca cola, innocent will be provided with the distribution scale to improve margins while maintaining price competition. Innocent are likely to obtain better/cheaper suppliers as a result of being financially backed by a corporation such as Coca cola.
Innocent have encountered problems with suppliers previously as a result of a large supermarket chain taking production. Their competitors found out innocent were planning to use clear bottles for their smoothies to make their products more visually appealing; however the supermarket found out and beat them to the supplier and production. (Telegraph.co.uk) extract from 25 years, 25 insights by piper private equity.
Intermediaries
Intermediaries assist a business in selling, distributing and promoting their product to their buyers. An example of this would be seen as a reseller such as Sainsbury’s and Tesco; companies that buy the products to resell them on to buyers. However retailers such as Tesco and Sainsbury’s are one of innocent’s main competitors with their own brand supermarket smoothies that sell for a cheaper price. Leave a comment
Group Blog
November 5, 2013UncategorizedGroup
We are completing a marketing audit on innocnet drinks, a brand which has found great success in the UK. We will be completing a macro and micro analysis of the market innocent operating within. Each member of the group will be researching and completing a different part of the marketing audit.