Cadbury Beverages, Inc.: Crush Brand
1. Based on your assessment of the soft drink industry, the orange-flavored category, and the competitive situation of Cadbury Beverages and orange Crush, what is your recommendation for positioning orange Crush? Be sure to base your recommendation on facts and issues raised in the case.
According to Exhibit 5, from 1985-1989, Orange crushes’ market share decreased from 22% (1985) to 8% (1989), this data shows that prior to the entrance of Coca Cola’s Slice and Pepsi’s Minute Maid, Orange Crush had more of the market share which at the time, they were positioned toward groups between the ages of 13-40. Since 1985, Crush repositioned itself to target individuals between the ages of 12-17. Appendix D shows that Pepsi Co. and Minute Maid entered the market with their own orange soda brands capturing a large portion of the orange soda market. These new juggernaut competitors reduced Crush’s market share consistently each year by positioning themselves in the 15-30 year old market. Initially, we thought it would be wise for Crush to revert back to its’ original target market, however with the emergence of Pepsi Co.’s Slice and Coca Cola’s Minute Maid into the market, and the fact that both brands are targeting individuals roughly between the ages of 15-30 (Crushes’ previous target market) (Exhibit 8), we believe it would be best for Crush to make an adjustment to their current positioning strategy. Shifting from their current age range (teens 12-17)(Exhibit 13) to younger children between the ages of 6-16 would tap into a market segment not currently being pursued by the new dominant Orange Soda companies. This shift would differentiate Crush even further from their competition, and as a result lead to more market share capture potential and competitive advantage due to the fact that they will be the first major orange soda brand to enter into this new target market. Secondly, the alignment with a younger age bracket comes less of a say the actual consumers (young kids) have in the purchase of this product which is why Crush needs to promote the fact that their formula includes 10% real juice, making it more appealing to the actual purchasers of the households (parents). We know that Slice and Minute Maid have already positioned themselves as a healthier choice, but within their market (p.323). The fact that Crush has natural juice will encourage parents to purchase the brand that their kids will love. Placing an emphasis on the natural flavor in print and media advertisements will reassure parents that they are making a healthy choice for their kids.
2. Based on your analysis, what objectives should be set for the Crush advertising and promotion program? What strategies should be pursued?
Crush’s first objective should be to continue repairing the relationships with the bottling network and build relationships with retailers. Crush should also increase spot marketing in areas most associated with children. Also, since Orange Crush’s main issue is that they are no longer uniquely differentiated among their competitors in the orange soda market, we feel the main objective should be to reposition the brand with respect to a younger age bracket (6-16). Finally, an integrated marketing communications strategy tying into the interests of the younger age bracket will be implemented.
In terms of advertising, Crush should incorporate their promotion strategies into end of aisle displays in supermarkets and television commercials. Because a brand can be locked out of about 60% of supermarket soft drink volume, it is important to involve the grocery retailers in a push marketing strategy by offering incentives to display Orange Crush in end aisle displays. Orange Slice and Minute Maid use promotional mediums such as magazines, newspapers, and billboards on the sides of roads (all places that reach THEIR target market). In order to grab the attention of the Crush...
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