Strategic Marketing Case 1

Topics: Energy drink, Sports drink, Marketing Pages: 9 (2901 words) Published: March 25, 2015


Strategic Marketing

Crescent Pure Case

by
Cenker Arslan (0511394)
Mert Bayraktar (0514486)
Umut Fisek (0514234)
Cem Ziya Gürsoy (0513408)
Muhammet Cihat Mete (0513241)

Portland Drake Beverages (PDB) is a manufacturer of organic juices and sparkling waters, which bought Crescent that is founded in 2008 by Peter Hoober whom already realized a market opportunity for a healthy energizing drink. Although he has started that production and selling of Crescent as a hobby, later on it became a business because of growing local demand. Crescent Pure Case is mainly about acquisition of Crescent by PDB in which market researches and customer surveys are realized in order to identify the best category for Crescent to be successful in United States.

1. Given that Crescent is PDB’s first entry in the US sport and/or energy beverage market, what must PDB do in regard to Crescent’s pending launch? Crescent should do a market research to determine which market has the most potential for their product. Important factors to consider are market need, the market itself and the competition in the market.

Sport-drink market
Energy-drink market

Market need
Most important elements that people think about sport drink:

Refreshing (34%)
Healthy (16%)
Affordable (11%)
Hydrating (49%)

Most important elements that people think about energy drink:

Refreshing (12%)
Healthy (6%)
Affordable (5%)
Hydrating (11%)
Market
The market reached $6.3 billion in the United States and was expected to grow to $9.58 billion by 2017

50% of men drink sport drinks and 40% find them refreshing
33% of women drink sport drinks and 27% find them refreshing 62% of those between 18 and 24 drink sport drinks and 77% between the age of 12

Growing market between 2010 and 2012 with 40%. It was estimated to be $8.billion in the United States in 2013

The largest group of energy-drinking consumers was males between ages 18 and 34. Parents of children were also more likely to consume energy drinks. The highest volume of energy drinks consumed was by respondents with a household income below $25,000 per year.

Competition
Gleam and Drips had 73% and 21% market share, The remaining 6% of market share was split fairly evenly among roughly 20 producer

Together, Fright, Razor, Torque and Stellar accounted for 85% of category revenue. The remaining 15% was split between roughly thirty independent regional and national producers.

Out of this market research we can conclude that it seems more interesting for Crescent to choose the market of energy drinks. Their brand image and their product is more similar to the perception that people have from energy drinks. Moreover most households that consume energy drinks have an income below $25,000 per year, while their drink is not really marketed to compete with the low cost energy drinks.

2. What factors should influence the positioning of Crescent? (textbook chapter 7-8-9) Claude Hopkins, who is one of the most important milestone of advertising and marketing, says, "people should know who their competitors are, what the others offer and what the people want." In light of this logic, in order to identify the positioning of Crescent, following factors should analyse primarily. Customer analysis

Competitor analysis
Market analysis
Environmental analysis

Customer analysis should include definition of customer segments, inquisition of customer motivations and identification of unfulfilled demands. For the PDB, natural, non chemical, low calorie Crescent product is able to be a good opportunity especially as a new product group in terms of unfulfilled customer demand. As a new entrant which needs leaping, Crescent natural functional beverage can generate a strong leverage effect in this market. Competitor analysis is the second phase of those analyses. In this phase, PDB should evaluate the competition from the broader perspective. As well as the competitors which...

References: Allcans. (2009). NALU-Energy drink-250-mL-Benelux. Retrieved from http://www.canmuseum.com/Detail.aspx?CanID=26281
Eileron. Aquarius Sports Drink. Retrieved from http://tracker.dailyburn.com/nutrition/coca_cola_aquarius_sports_drink_calories
Living for Today.(2013) Product Review: XS Energy Drinks. Retrieved from http://www.esteslivingfortoday.com/product-review-xs-energy-drinks/
Quelch, John and Zalosh, Alisa (2014) Crescent Pure, Harvard Business School (Case 9-915-539)
Quite Healthy Technologies.(2011). Gatorade Nutrition Shake, Strawberry. Retrieved from http://www.quitehealthy.com/nutrition-facts/gatorade/L380771.html
Red Bull GmbH. Q&A. Retrieved from http://energydrink.redbull.com/calories-and-nutrition-facts
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