Consumer Protection and Smoothie Brand Innocent Essay Example
- Trading Standards ensure “consumer safety and that fair trading and quality standards are maintained” (Brassington & Pettitt, 2006, p. 83).
- Legislations enforced by Office of Fair Trading (OFT).
- Pressure groups e. g. Advertising Standards Agency (ASA). Pepsi complained to ASA about Innocent.
- Rulings – Department of Health ruled that smoothies can count as two of the RDA of fruit and vegetables.
- UK economy situation and trends affect company’s costs e. g. nergy costs and cost of ingredients
- Taxation - A capital tax gain encouraged investor Maurice Pinto to fund the company.
- Inflation affects price of product.
- Industry factors - Innocent had to find manufacturers willing to forego the more logistically difficult and expensive process of making their drinks without added ingredients.
- Consumer confidence index
- Import/export ratios
- Market routes and distribution
- Production level
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- Business ethics - 10 percent of profits goes to the Innocent Foundation which carries out good causes such as post-tsunami regeneration. Innocent also ensures its fruits are ethically grown in acceptable work conditions for fruit pickers.
- Health awareness had risen in the UK through NPO advertisements making consumers more health conscious. Innocent capitalised on this by highlighting key health benefits to their products like their contributions to consumer’s Recommended Daily Amount intake and that they were 100 percent fruit.
- Consumer attitudes became significantly more health-conscious. Innocent recognised this and created their unique smoothies made of 100 percent fruit to meet consumer demands. Consumer buying patterns - Innocent realised consumers would be willing to pay premium prices for their products because they contained nothing but high quality fruit (sourced under regulation by Rainforest Alliance). They also created product variety to increase consumer
- Waste removal/Recycling - Innocent introduced the first 100 percent recycled plastic bottle. Their bottle labels are also 25 percent recycled.
- Manufacturing advances
- Consumer protection laws - Innocent’s “products have to conform to safety laws” (Brassington & Pettitt, 2006, p. 80)
- Industry-specific regulations - Innocent’s “manufacturing processes are subject to pollution controls” (Brassington & Pettitt, 2006, p. 80).
- Competitive regulations * Employment Law – e. g. employee contracts.
- Ecological – Identified ways to reduce resource wastage.
- Management style - The founders give employees the flexibility to work in areas of their interest.
- Staff attitudes are testament to the brand values, being good to people and the environment.
- Staff morale is consistently high due to friendly and rewarding work environment.
- Customer values – Innocent offers healthy products and puts a lot of effort towards communication and interaction e. g. blog membership website where they also receive valuable feedback.
A SWOT analysis looks critically at the strengths, weaknesses, opportunities and threats of a business or project and sorts them out systematically. It emphasizes certain internal and external aspects that are advantageous or disadvantageous to the accomplishment of a goal and helps those involved develop strategies towards realising this objective.
- Leading smoothie brand – Innocent currently own 77. 5% of the smoothie market. It has established itself as a premium brand by charging premium prices above its other similar specific
competitors based on its unique selling point. It has also developed a resolute brand image by using light-humoured communication cohesive with the brand’s values.
- Price – Innocent’s premium retail prices means there will always be a segment of the market reluctant to purchase their product in favour of their competitors.
- Low customer base – Innocent have a relatively smaller customer base (EU) compared to
- Increase market share - The market Innocent operates in is still growing as more and more consumers are becoming cautious of the effects of processed goods. This is a clear opportunity for Innocent to cease more of the market.
- Emerging markets – Global expansion.
- Increase product range – i. e. vegetable, dairy and whole grain products.
- Eco-friendly promotions with other organisations like National Trust.
- Changing customer tastes i. e. product range/variety becoming repetitive.
- Cultural differences – language has been instrumental to Innocent’s success. Cultural differences may create a barrier for success when expanding to wider continents.
- Brand susceptibility – As the company grows the brand’s values are subject to greater scrutiny based on their actions - such as they are now with selling stakes to Coca-Cola – similar to criticism they received when they partnered with McDonalds.
- Tropicana (PepsiCo) – Tropicana are Innocent Drink’s main competitors and the Pepsi owned company currently holds 29. 3% market share in the UK. Their marketing strategies follow a very similar pattern to its rival focusing efforts on and emphasising the health benefits of its products using popular terms as ‘GDA’ (Guideline Daily Amount) and the ever familiar ‘100% Fruit’, phrases consumers have become well accustomed to. Other marketing strategies such as appealing artwork on packaging have been used to increase brand loyalty.
Tropicana smoothies are approximately a third cheaper than Innocent, attracting the more price-conscious customers than those more concerned with the manufacturing process. More aggressive tactics have been used by the brand which has also created products aimed at the kids smoothie market where it has set prices relatively low to the competition. Since its
launch in early 2008, the Tropicana smoothie range’s has achieved its main objective of reinforcing its presence in the market by the aforementioned methods as well as large television advert campaigns.
It has also built incorporated ethical values resembling Innocent, regarding where and how it sources its fruit, environmentally sustainability and the use of renewable energy to further increase brand loyalty.
- Happy Monkey – Although this brand is new to the market (launching March 2009) its performance has been exceptional achieving sales of over ? 1. 3 million in its first year of trading. With its main focus on the kid’s smoothies market – a market Innocent also concentrates on - it has established itself as a serious competitor rapidly creating brand loyalty supported solely by promotions.
Like the competition, Happy Monkey stresses its healthful nutritional value, the quality of its natural content and its ethical principles to sway customers in their favour. Similar general:
- Lucozade Sport – The Lucozade Sport brand is the market leader in the sports drink category. It has sustained this position by regular product innovation supported by heavy marketing campaigns, sponsorships and endorsements. They have recently launched Lucozade Sport Lite - a low calorie sports drink - to further propel sales.
- Red Bull – Red Bull is an established energy drinks brand that also uses heavy TV ad campaigns as well as outdoor material to sustain a presence in the marketplace. It maintains the brand image by constant reinforcement of the slogan “red bull gives you wings” to which consumers and non-consumers alike have been familiarised with.
- Seven Seas (Multibionta) – This multivitamin supplement brand satisfies the same consumer health needs
by different means to Innocent.The product’s selling point is also based on Recommended Daily Amounts of its nutritional content. Such products have benefited highly from the rise in health awareness; however, they are not advertised as often as soft drinks brands.
- Kellogg’s Cornflakes – This highly popular cereal is one of Innocent’s many distant competitors in the market of discretionary spend.
- Young’s Pink Salmon – This premium brand fish product is also a competitor based on customer preference at the moment of purchase.
- Brassington, F. & Pettitt, S. (2006). Principles of marketing, 4th edition. Harlow: Prentice Hall.
- Simmons, J. (2008). Innocent: Building a brand from nothing but fruit. London: Marshall Cavendish Limited.
- Innocent. (2010) Cheatsheet, http://www. innocentdrinks. co. uk/press/cheatsheet/, accessed on 9th March
- Phoenix, C. (2009) Richard Reed, Innocent Drinks, http://83. 138. 128. 13/interview/interview-richard-reed-innocent-drinks, accessed on 14th March
- Beckett, A. (2009) Innocent leads return to form for smoothies, http://www. thegrocer. co. uk/articles. aspx? age=articles&ID=204507, accessed on 16th March
- Tryhorn, C. and Sweney, M. (2009) Smoothie operators Innocent tread familiar path to lucrative deal, http://www. guardian. co. uk/business/2009/apr/07/innocent-smoothies-coca-cola, accessed on 16th March
- PepsiCo, UK & Ireland (2010) Tropicana, http://www. pepsico. co. uk/brands/tropicana, accessed on 17th March
- Food & Drink Innovation Network. (2010) Happy Monkey smoothies buck market trend, http://www. fdin. org. uk/2010/02/happy-monkey-smoothies-buck-market-trend/, accessed on 18th March
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