Strategic Marketing Short Essay Example

about the new product's positioning. The new product is Crescent Pure the newly acquired beverage line of PDP, and a strategic decision has to be made between positioning the product either in the sports drink market or the energy drink market. In order to make a decision the factors that affect this decision must be clearly defined so we will examine the pros and cons of the two options.

Crescent pure as a Sports Drink pros: Crescent Pure has hydrating elements crucial in a sports drink. Ingredients can help both in boosting performance and reducing fatigue Crescent Pure can be differentiated from the Market leaders in sports drinks as a healthier option. A sizable percentage of consumers considered sports drinks "anytime beverages. " Sports drinks attract a wider consumer base than Energy drinks. Opportunity to market it as a "Premium sports drink" due to price. Cons: The sports drink market is $2. Bill. Less then energy markets. The sports drink market is expected to grow in a smaller rate over the coming years than the energy drinks rarest ($5 vs. $3. 2 Bill. ). Crescent Pure is more expensive than the competitor's products Crescent Pure is also enhancing mental focus and boosts energy which is not sports drink characteristic. Very strong competition with 2 brands dominating the market.

Crescent pure as an Energy Drink Very strongly differentiated from competition, as a healthier alternative to market leaders.

Crescent pure boosts energy combats fatigue and provides mental focus, main characteristics of energy drinks. Informal consumer survey indicated that "energy" is its more descriptive characteristic. Cheaper than average competition price. Bigger market. Bigger market growth. Retailer feedback indicates

that Crescent pure most appeals to the consumer base of Energy drinks. Cons: Narrower consumer base (young males and parents of young children). Concerns about the long term viability of the market, due to negative media attention. Strong competition.

In Conclusion, the Energy drink marker offers greater segmentation, so less resistance to entry is expected, the product is already finding most appeal in the same customer base as energy drinks, and it has a competitive advantage due to rice and differentiation (being a healthier option) so considering all the factors, the energy drink market is more appealing.

How is the market segmented? At what segment should Crescent be targeted? The non-alcohol functional beverage market is traditionally segmented as: Energy drinks consumers, people who need energy to combat fatigue and promote mental focus.

The largest group of energy-drink consumers were men between age 18 and 34, with household income below 25,000 USED per year (medium). Sports drink consumers, people who need refreshing, hydrating, replace water and electrolytes after training r competition. Roughly half of men drank sports drinks, while only a third of women did. Sports drinks are preferred by younger consumers-62% of those between 18-24, and 77% of those ages 12 to 17. Recently, people who concern their health and prefer organic food and beverage as the third segment is on growth.

According to the market research and strategic analysis, Crescent should target younger, health- conscious consumers who regularly consume energy or sports beverage. Besides people who concern health and constantly purchase organic and all-natural products could be also their potential consumers. The customers for Crescent transcend a specific age or demographic age. The benefit

for this STEP strategy is that Crescent can deliver alternative values to customers: refreshing taste, mild energy boost, hydration and organic ingredients at the same time.

Thus the company can include different segments customers without competing directly with existing main players in the energy drinks market and in the sports drinks market.

What are the pros and cons of positioning Crescent as an energy drink, a sports drink, or a healthy organic beverage? Market opportunities, consumer preferences and competitions are the most important factors that need to be considered before craft a comprehensive positioning strategy. ( Domingo, E. 1988) Pros for Energy Drink Market size is big and is growing. Market grew 40% between 2010 and 2012. It was $8. Billion in USA in 2013; forecasts projected that fugue to reach $13. 5 billion by 2018. Compared with other energy drinks, Crescent has lower cost which lead price advantage for Crescent in the market. Crescent can boost energy and mental focus. Besides, Crescent has health benefits. It does not contain artificial chemicals, uses caffeine from natural products, uses much less sugar, all natural flavors, which can employ with the rising demand for healthier food and beverage choices from the customers. Cons for Energy Drink News stories were highlighting energy drinks' alleged health risks.

Only 32% of consumers said they have drunk an energy drink in last 6 months. 11% of people are drinking less energy drinks because of health risks. Some younger consumers think it has less energy than they had hoped. Some people question the ability to deliver quality organic ingredients at only $2. 75 85% market is shared among five big competitors: Together,

Fright, Razor, Torque, and Stellar. Pros of Sports Drinks Market size was $6. 3 Billion in 2012 in USA and was expected to grow to $9. 58 Billion by 2017. Consumers choose sports drinks more often. A high percentage of consumers considered sports drinks "anytime beverages".

A Study showed consumers favored Sports drinks over Energy Drinks for multiple factors. New diet and low-sugar sports drinks were growth areas for the industry, which could be an opportunity for Crescent. Crescent has the ingredients which can boost endurance and relieve fatigue. Cons of Sports Drinks The market increased only 9% between 2007 and 2012. The sports drink market is 2. Billion dollars less than energy drinks markets Crescent's cost is $2. 75 which is significantly higher than competitors prices Concerns for sugary and obesity rate, government required to remove numerous sports drinks in schools vending machines beginning in 2014.

Crescent enhances mental focus and boosts energy, it is not viewed as a sports drink. Pros for healthy organic beverage Organic food and beverage has the trend of growth. Market potency is high. Crescent was originally positioned as an organic Energy Drink and the product was very successful which was sold 1000 cases/month. It contains 70% less sugar, caffeine = 1 cup of coffee, low calories, energize, hydrating, all-organic ingredient which are welcome for the people who are conscious with health. Organic beverages claimed a price premium (on average 25%) over conventional beverages of the same variety.

Cons for healthy organic beverage "Organic beverages" category include too many types of drinks, such as carbonated soft drinks, coffee, tea, fruit Juice, energy drinks, milk, and soy beverages. All these

above mentioned will share the market and profit. The competition is very high. Healthy organic beverage is a relatively new market. It could be very hard to predict the market, to profit past experiences in the marketing activities. 5. Position Crescent Pure in the two perceptual mappings given in Exhibit 1 and 2.

Also place the brands 'Redouble', 'Monster', 'Anal', 'Storage' and 'Aquarius' on the maps. According to the table 1 and table 3 in the case, for hydrating, energy drinks have 11%, sports drinks have 49%, Crescent have 29%. Crescent's hydration is almost in the middle of energy drinks and sports drinks. For energy, according to the case, Crescent contain 80 milliards of caffeine, roughly the same amount of energy effect f a cup of coffee, which is half of the energy contained in a similar serving of the two leading energy beverages on the market, Fright and Razor.

According to the nutrition facts of different brands, Redouble and Monster have similar lower hydration (1 1 per mall); both have high energy. Both are positioned as energy drinks. Aquarius and Anal has similarly very hydration (5. G per 100 ml and 4. G per 100 ml). However Anal has more energy than Aquarius. Aquarius is positioned as sports drink and Anal is positioned as energy drinks. Storage has very high hydration (21. G per 100 ml) but lower energy. It is positioned as sports drinks. For nutrition, Crescent has low calories, 70% less sugar than sports drinks and energy drinks.

Besides, in the nutrition facts of Crescent, we can see it contain low calories, same as Monster(42 per 100 ml). For taste, according to

the market research (focus group), Crescent's taste appeals to most consumers. Some one were very pleased with the taste. There were no unfavorable reactions. According to the nutrition facts of different brands, Storage has very high calories (144 per mall), while Aquariums has very low calories (24 per 100 ml). Both above are positioned as sports drinks. Nard is in the middle between the above two (84 per 100 ml).