During 1987 – 1993, Snapple was one of the successful brands of a variety of non-carbonated beverages that targeted mainly towards the young, health conscious consumers. Snapple provided many varieties of flavour to its consumers and placed them in different market segments which were mainly cold channel distributions. With a premium pricing strategy, it had price as an indicator of quality and was consistent with its positioning strategy. The success of its marketing strategies were able to enhance consumers brand awareness, brand recognition and brand recall. Subsequently, Snapple was sold to Quaker Oat in 1994 for $1.7 billion, the sale was in decline. Quaker made mismanagement in financial, marketing strategies. Accompanied with ineffective advertising and marketing programs, lost in trust in distributors and increase in competition in the market, were among the reasons for the brand’s decline. In 1997, Quaker decided to sell the Snapple to Triarc for $300 million.
MPD † 545: Snapple Revitalization Plan
Problem Statement - Changes need to be immediately implemented to stop the declining revenue trend of Snapple. Revenues declined from $674M in 1994 to $440 M in 1997; the sales plummeted by 34.7% Snapple was best known for its line of iced teas and juices in off-beat flavors but recent surveys show that Snapple brand means different thing to different people. So the immediate goal is to position the brand and return to sustainable growth. Also one of the biggest priorities is to repair the distributor relationship which was distressed because of prior owners. SWOT Analysis
|Strengths |Weaknesses | |Cold Channel network / Distributors |Positioning of Snapple brand | |Triarc's Corporate style |Limited penetration in Supermarket | |Triarc's acquisition expertise
Product and Brand Management:325-307
3. The Fall of Snapple – 1993 to 1997
SWOT analysis is used to evaluate the failure of Snapple and Quaker’s management performance. The aim of SWOT analysis is to identify the key internal and external factors in the market environment in achieving the underlying business objectives and goals. 3.1 Internal Factors:
Strength is the competitive advantages and attributes which helps to differentiate companies from competitors, in meeting the target market demand. Quaker is experienced in managing its products and also building strong brand images. Since it had the resources and management skills, it was foreseen to be able to benefit Snapple brand. Moreover, the wide range of flavours tends to reinforce Snapple’s individualism characteristic, which was a clear point of difference. Snapple also possessed a strong heritage of providing authentic, natural juices. However, past performance offers no guarantee of future success and even well-established brands need to work to sustain their position. Weakness relates to the limitation and restraint in decision making to achieve the objectives. Gatorade and Snapple had different brand images: lifestyle and fashion, respectively, which created confusion to the consumers as the brand portfolio was not properly managed. Brand values and meaning are related to consumers’ perception of belonging and loyalty of the brand (Quester, 2006). Yet, Snapple had difficulty in differentiating its product from “fashion water”. It lacked compelling reason for use. Mainly due to the discontinuance of Wendy and Stern, brand loyalty was lost which impacted Snapple’s financial performance (Leiser, 2004). The failure of large pack of Snapple drinks illustrated Quaker’s low understanding and lack of consumers’ and distributors’ communication. Moreover, the failure...