Group Assignment 2 Crescent Pure Case

CASE 2 : CRESCENT PURE 1. Exec Execut utiv ivee summ summar ary y

Product positioning is an important element of a marketing plan. Product positioning is the process marketers use to determine ho to !est communicate their products" attri!utes to their their target target customer customerss !ased !ased on customer customer needs# needs# competi competiti$ ti$ee pressure pressures# s# a$aila!l a$aila!lee commu communic nicati ation on channe channels ls and carefu carefull% ll% craf crafted ted ke% messa message ges. s. Effe Effecti cti$e $e produ product ct  positioning ensures that marketing messages resonate ith target consumers and compel them to take action. &by Leigh Richards). Portland 'rake (e$erages &P'() ac*uired Crescent in +ul% 2,- in order to e/tension its e/isting organic product lines !% launching launching a product hich com!ines energ%0enhancing# energ%0enhancing# h%drating# and all0organic ingredients. R%an# the $ice president of marketing for P'(# as asked to pro$ide recommendation on the positioning strategies. To options are as follo: 1 Energ%0drink positioning# 1 Sports0drink positioning. n order to ha$e a good positioning# e ha$e to anal%3e the customer needs# competiti$e  pressures# communication channel and con$e%ing the differentiating of the products through the selected communication channels. (ased on the o!ser$ations and anal%3ing the case 444.&e need to rite here hich  product is !etter in the th e positioning segmentation) seg mentation)

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CASE 2 : CRESCENT PURE 2. Case analysis 2.1 Crescent Pure (a company)

Peter 5ooper# a nati$e of crescent# 6regon# sa a market opportunit% for a health%# energi3ing drink. 5e founded Crescent in 2,,7. 6rganic# all natural food a !e$erages  !ecame u!i*uitous in the Pacific Northest region in the -88,s and earl% 2,,,s# and 5ooper found popular energ% and performance0enhancing drinks unhealth%# to seet# and artificial. 5e !egan e/perimenting ith different ingredients in order to craft an organic# all natural !e$erage lightl% infused ith organic 9uices her!al stimulants# and electrol%tes. 5e anted a drink that ould refresh# energi3e# and enhance mental focus. hat !egan as a ho!!% !ecame a !usiness as 5ooper sa groing local demand for his product. Portland 'rake (e$erages &P'() recent ac*uisition of Crescent Pure is a $er% interesting mo$e that could !oost the compan%;s current market. 5oe$er# due to Crescent;s $ersatilit% Sarah R%an has !een charged ith figuring out hether the% should position the drink as an energ% drink or sports drink. 2.2 Customers

2?#,,, per %ear. @or sports drinks consumer# roughl% half of men drank sports drinks# hile onl% a third of  omen did. Although =, of men found sports drinks refreshing# onl% 2B of females did. Sports drinks appealed to %ounger consumers D2 of those !eteen ages -7 and 2=# and BB of those ages -2 to -B.

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CASE 2 : CRESCENT PURE 2.3 Distributors

n this industr%# the distri!ution ill in$ol$e mo$ing products from manufacturing to distri!utors and then the distri!utors ill sell the products to retailer !efore the products deli$er to consumers. Usuall%# distri!utors ill markup 2? from manufacturer hile retailer ill markup =, from distri!utors. (ecause of limited production capacit% and in order to ensure distri!utors profita!ilit% sold out# P'( onl% used three distri!utors. The distri!utors monthl% cost ould >=#,,, during Cresent;s first %ear. The cost includes cost of goods# marketing materials# emplo%ee training and compensation. P'( ill decide hich distri!utors to select after determine the most effecti$e positioning for Crescent  !ecause the drink;s positioning ould influence here the product as sold and hich distri!utors that P'( ould select. 2.4 Competitors

There are to leading energ% !e$erages on the market# @right and Ra3or folloed !% Tor*ue and Stellar. Table 1 and Table 2 shos the market share for each energ% drinks and sports drink. Competitors @right Ra3or Tor*ue Stellar 6thers

Market !are = 2B -D 7 -? Table 1: Energy Drink 

Competitors leam 'rip 6thers

Market !are B 2- D Table 2: Sports Drink 

3. Market researc!

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CASE 2 : CRESCENT PURE Research pro$ided from three consumer sur$e%s conducted !% a pri$ate research firm# se$eral academic reports and industr% media co$erage. e are using S6T anal%sis to summari3e the sur$e%s.

3.1 "#$ %nalysis comparison bet&een Ener'y rinks an port rinks $E*+,$

The market for energ% drinks as groing for the period 2,-, and 2,-2# had gron  !% =,. t as estimated to !e >7.? !illion in the United States in 2,- and forecasts  pro9ected that figure to reach >-.? !illion !% 2,-7. The market for Sport drink increased onl% 8 !eteen 2,,B to 2,-2. n 2,-2# the market for sports drinks reached >D. !illion in the United States and as e/pected to gro to >8.?7 !illion !% 2,-B. @rom the a!o$e# Energ% is e/pected to gro !igger in $alue compare to Sport drinks.

"E%-*EE

Energ% drinks market share here @right# Ra3or# Tor*ue# and Stellar accounted for 7? of  categor% re$enue &=# 2B# -D# and 7# respecti$el%). The remaining -? as split  !eteen roughl% thirt% independent regional and national producers.

leam and 'rip had B and 2-  market share# respecti$el%. The remaining D of  market share &>B7 million) as split fairl% e$enl% among roughl% 2, producers. @rom the a!o$e# Energ% ha$e more competitors and larger market compare to Sport drinks market share and competitors.

#PP#$*/$/E

Sales of energ% drinks ith loer le$els of caffeine and purer ingredients ere rising Page 4

CASE 2 : CRESCENT PURE due to consumer demand for healthier food and !e$erage choices.  Ne diet and lo0sugar sports drinks ere groth areas for the Sport drink industr%. 'iet and lo0sugar sports !e$erages# hich did not e/ist !efore 2,,8# had gron !%   !eteen 2,-, and 2,-2# taking market share from traditional sports drinks. The market si3e for diet and lo0sugar sports drinks as e/pected to increase from >-.= !illion in 2,-2 to >2.8B !illion in 2,-B. Energ% drinks demand ill !e increasing as people ants more healthier food and  !e$erage compare to sport drinks hich is high in chemicals from la!s engineered nutrition.

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 Nes stories ere highlighting the drinks" alleged health risks: 2 of consumers o$er -7 indicated the% drank an energ% drink in the last si/ months# -- of hom ere drinking feer energ% drinks than the% had a %ear earlier# due to concerns a!out health and safet%. Sport drinks is creating concern regarding rising childhood o!esit% rates resulted in go$ernment0mandated guidelines to remo$e high0calorie sugar% drinks and snacks# including sports drinks# from school $ending machines !eginning in 2,-=. The a!o$e threats shos that energ% drinks create less health risk compare to sport drinks.

4. e'mentations an $ar'etin'

Segmentation and Targeting Portland 'rake (e$erages; &P'() recent ac*uisition of  Crescent Pure is a $er% interesting mo$e that could !oost the compan%;s current market. 5oe$er# due to Crescent;s $ersatilit% Sarah R%an has !een charged ith figuring out hether the% should position the drink as an energ% drink or sports drink. The main age range of energ% drink consumers are !eteen -70= %ears old and are t%picall% male# hile the sports drink market is larger# including a larger male and female population ranging from age of -202=. 5ooper had set up an online store# anticipating a future focus

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CASE 2 : CRESCENT PURE on online sales. Chart - and chart 2 shos the stud% of online sales !ased on gender and ages.

Gender of Crescent Online Consum er

Female; 41%

Male; 59%

Chat 1: Gender of Crescent Online Consumer 

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CASE 2 : CRESCENT PURE

Age Range of Crescent Online Consumer

45-54; 3% 55 +; 2% 35-44; 15%

18-24; 44%

25-34; 36%

Chart 2: Age Range of Crescent Online Consumer 

(ased on the chart a!o$e# it shos that most of the consumers are male !ecause male acti$el% in$ol$ed in sports. n term of age# == of the consumers are age ranges from -702= %ears old hile D are age ranges from 2?0= %ears old. 2?#,,, per %ear. Roughl% half of men drank sports drink# hile onl% a third of omen drank sports drink. Although =, of men found sports drinks refreshing# onl% 2B of females did. Sports drink appealed to %ounger consumers F  D2 of those !eteen ages -7 and 2= hile BB of those ages -20-B. So that# P'( determined that %ounger# health0conscious consumers ho regularl% consumed energ% or sports drink ere potential prospects for Crescent.

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CASE 2 : CRESCENT PURE Compare to other competitors# most products the% offered is not a health% alternati$e for energ% drinks.