Cresent Pure : Position It Right A Harvard Business Case Study

The problemPDB

Manufactures sparkling water and orange juice

Brand values : Quality product at affordable prices

Looking to increase organic product line

Cresent

Organic, all-natural energy drink.

Moderate energy, low sugar content

Riding on the locavore movement.

Problem statement

PDB acquired Cresent Pure.

Want to position it to get optimum sales result.

Want to break even with the advertising budget of $750,000

Situational AnalysisProduct Positioning

Sarah Ryan needs to decide whether Cresent Pure will be marketed as a Sports Drink, Energy Drink or Organic Beverage

Production Constraint

There’s a constraint on production of 12,000 can a month which has made cresent go for a soft launch to gain the first mover advantage.

PDB’s Goal

To increase sales and ride on the locavore movement with a more wide product line.

Product Positioning

Options

Energy Drink85% market share with the top 6

competitiors

Locavore Movement and the rise of healthier drinks

Primary Consumers : Males b/w 18-24

Threats : News relating to health issues.

Sports DrinkProjected 9% growth of the industry

Top 2 competitors hold 90% market share

Oppotunity : Increased demand for healthier and diet beverages

Threat : Increasing obesity and govt. intervention

A third option

max growth

● New and emerging market with the rise of locavore movement

● Larger consumer base● Higher margin rates ( usually

25%)● Niche market for health

conscious consumers

Market AnalysisMarket Trend

Rising demand for organic, all natural foods

Market Growth

Sports Drink - 9%growth

Energy Drink - 40% growth

Competition

High cometition in both energy

and sports sector

Threats

Negative campaign against

sports and energy drinks

Competitive Advantage

Competitors to roll out health drinks only in

mid 2015

Target Market

Age group 18-34Health concious

Points of Difference

Low sugar and caffeine content

Consumer Analysis - Cresent

18-24 25-34 35-44 45-54 55+

44% 36% 15% 3% 2%

Annual Income$42,500

Profit Margin

Analysis

Budgeting to optimally price the

product.

$ 1.24

Manufacturer - 18%

$ 1.65

Distributor - 25%

$ 2.75

Retailer - 40%

COST ANALYSIS

Break Even Analysis

SWOT

Low competition in high hydration and mid - high drinks.

Low competition in high nutrition and high taste drinks

Swot AnalysisStrength

All organic and natural drink

Lower levels of sugar and moderate levels of caffeine

A healthier anytime beverage for health conscious consumers

Weakness

Lower caffeine content than competitors

Lack of Brand awareness compared to competitors.

Opportunity

Low competition in high hydration and mid energy drink

Middle of locavore movement

Recovering economic for functional beverages

Threats

Negative media attention

Established competitors in Energy and sports drinks categories

Lower prices question the organic label which is usually costlier

Implementation

Product

Launched as a organic, healthy energy drink

Price

Priced at $2.75 which is above the general sports drinks and lower than the energy drinks

Promotion

Heavily promoted over social media,event sponsorships and other digital forms to reach the younger target audience

Distribution

Focus on Washington, Oregon and california.Distributed through big box stores like WalMart.

ConclusionShould be positioned as

healthier alternative to other energy drinks

Priced between the premium energy market and the general sports market at $2.75

First Mover advantage before the mafor beverage brands

Increasing the product line length.

Energy Drink

DisclaimerThis presentation has been made by Kunwarjeet Chawla, BITS Goa in fulfillment of the requirements of Marketing Management Internship pursued under the mentorship of Prof. Sammer mathur, IIm Lucknow.