The energy beverage companies are targeting same group of people as Red Bull and it is hard to make significant increase in profit. To make more profit companies should target diverse types of consumers to differentiate your company from the other companies in the same branch. The heavy consumers of energy beverages are consist of males between 12 and 34 ages. In this market is high brand loyalty which means that average consumer is limiting his/her choice to only 1.4 different brands. The convenience stores and supermarkets are the dominant off-premise retail channels for energy beverages.
It is important to remember that it is one thing about drinking diet soda people genuinely enjoys the taste, but it is another thing is to drink it solely, because some people feel that they will lose weight from drinking it. Regular Coke has a very sweet and strong taste. People like Coke more than Diet Coke. Regular coke gives people more energy than Diet Coke. Between Regular Coke and Diet Coke, Regular Coke gets sells fast.
* Threats * Moving to a new product line could hurt the core brand. The new product could cannibalize the Lager and/or act as a substitute. Economies of scale of the large national brands allow them to advertise and market light beers to the younger demographic. 4. What are the decision options?
Coca-cola believed that as this segment aged, it would move on to healthier diet drinks and hence they needed to look into the “full-calorie” young segment. Figure 1 below graphically depicts this understanding. At that time the youth favored Pepsi’s high calorie content by even more overwhelming margins than the market as a whole. Thus Coca-cola zeroed-in on this segment and launched the “New” Coke (of course they substantiated their strategy with surveys and focus groups, the unbiased nature of these efforts is now being questioned) Fig 1 What went wrong: The purpose of segmentation is to break mass markets into
Defend your strategy to successfully compete against market leaders in your segment. Hints: For example, in the soft drink market, it is intimidating to try to compete against Coke and Pepsi. Newcomers in mature markets typically must pursue niche markets or even create new market categories, as Red Bull did with energy drinks. c. Defend your plan to differentiate yourself from the competition using the information detailed on the worksheet in the text (p. 131 | Market Share Distribution). Hints: Every business faces competition and the non-alcoholic beverage market is an especially crowded market.
The two key competitors in the area are The Grog Grill and Kelly’s Taproom. The Grog Grill attracts an older crowd due to a more costly menu, and upscale décor, polarizing our younger target market due to its lack of affordability. Furthermore, the Grog Grill advertises itself as the perfect place to cater or host events, neither things our niche market is interested in. nor does the Grog Grill have much room for patrons to let loose and have a good time. Kelly’s Taproom is our most direct competition since it tends to attract both our niche market due to its prime location near colleges and universities and older guests.
It is certain that some young adults may have already established brand loyalty to companies of some other alcoholic products. However, for some other young adults, certain brands or types of alcohol can be too strong, and some can be quite unaffordable or simply “boring”. As for its target market, the Cabana Boy Rums concentrates its efforts on those young adults who do not like the taste of those strong alcohols, those who do not wish to spend a lot of money on high-class alcohols, like champagnes and wines, and those who just like to try newly designed product and, perhaps, would like to be one of the stylish “Cabana Boys”. Although there is no specific secondary target market for the Cabana Boy Rums, its product can appeal to anyone in the market, such as those older adults who have had other companies’ products for long period and simply wish to try or even
Under the pressure coming from large national brewers, MMBC is considering to extend its product line: launch Mountain Man Light to attract a new market segment and remain profitable. Although launching light beer may attract a new market segment and get more exposure for MMBC, MML may “drown” in the sea of large light beer brands and even lose loyal customers from its core brand Lager. The main customers of MMBC are blue collar, middle-to-lower income men over age 45. MMBC is famous for its “toughness”, so the market they serve is traditional baby boomer generations. In general, United States was the largest beer-consuming market in the world with over $75 billion in annual sales in 2005.
Sales may be higher in zones where coffee is more popular versus where tea is the main selection. (Gurufocus.com) The rollout of alcohol and wine sales in some locations of Starbucks was a big risk to take for the company. Which is why they chose limited stores to partake in this venture. It started with one location in Seattle and then moved on to Atlanta, Southern California and Chicago. Out of all of the locations, Seattle saw the biggest and strongest sales trend.
The ingredients in energy drinks are also one of the main reasons why they are not good for you. Most of them contain a high amount of caffeine. Researchers say that the average energy drink has the same amount of caffeine as 7 cups of coffee. That is a lot more caffeine than a teenager needs! Energy drinks have other unhealthy ingredients in