m file · web viewexternal environment. current economic conditions. an analysis by the...
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External Environment
Current Economic Conditions
An analysis by the U.S. Department of Labor confirms unemployment rate has
decreased continuously since 2009, as it is now 5.1%. The labor market continues to improve,
as illustrated by job gains in the private sector, as well as the falling unemployment rate.
According to the Department of Numbers, employment in September 2015 is at a new high of
over 140 million people. Due to this, consumer confidence has grown steadily. Over the last
year, prices of goods declined 0.1% according to the Labor Department. The U.S. Bureau of
Economic Analysis reported that the United States economy expanded 3.9% in the quarter
leading up to June of 2015. This exceeds the previous estimate of 3.7%. Currently, Americans
spend more than 30 billion dollars on athletic apparel and accessories, which includes water
bottles. The steadily improving economy provides advantageous conditions for Trifecta to
emerge as a competitor in the water bottle industry, while promoting the preservation of the
environment and a healthy lifestyle.
Industry Analysis
Trifecta competes in the 22 billion dollar bottled water industry. According to
Rubbermaid, Americans spend over $1.5 billion dollars a year on reusable beverage containers.
Americans alone, spend over 11 billion dollars on disposable plastic water bottles each year.
According to the International Water Bottle Association, total annual U.S. bottled water
consumption was 10.9 billion gallons in 2014, which translates to approximately $500 per
family. A single investment on a reusable water bottle can drastically reduce the cost of
drinking water.
In America there is a growing sense of awareness to save the environment. Campaigns
such as Ban the Bottle and Travelers Against Plastic are gaining popularity as they work
towards the elimination of plastic waste in the environment. Many cities such as San Francisco,
CA, Mt. Shasta, CA, and Concord, MA have banned the sale of disposable water bottles in an
effort to reduce the effect they have on the environment.
Trifecta’s primary real world competitor is Camelbak. In 2012, Camelbak made $157
million in sales, a 28% jump from $122 million 2010. Camelbak offers three styles of reusable
water bottles; a plain bottle, a filtered bottle, and an insulated bottle. Trifecta ‘s filtered and
insulated bottles are, on average, two-thirds of the price of Camelbak’s filtered and insulated
bottles. The Company’s secondary competitor is Nalgene which only offers plain water bottle.
Trifecta offers a compatible app for all of its products, and a variety of bottles that have unique
features including the smart water bottle, filtered, fruit infused, and insulated bottle.
Trifecta’s bottles stretch over several classifications of products such as; sports and
leisure, food and beverage, and health and beauty. Trifecta will excel in all of these categories
due to its attractiveness, utility, and affordability in the virtual marketplace. Affordability is a
crucial factor when deciding what to buy for many students as they have a limited amount of
discretionary income. The expected demand for Trifecta’s products is high because of its “cool
factor” that differentiates itself from competitors.
Competitive AnalysisIn the Virtual Enterprise world, Trifecta has two direct competitors. These firms are
Aqua Pura and Every Drop Counts. However, we differentiate ourselves by offering our
HidrateSpark bottle. This is the only bottle in the market equipped with bluetooth technology.
Trifecta has many indirect competitors who are trying to capture their share of the
virtual market, as virtual enterprise students have limited discretionary income to make
purchases. Trifecta’s only indirect competitor who has something similar to Trifecta is Impulse.
They sell a portable blender which allows the user to transport and blend their drink on the go.
Trifecta differentiates itself by offering a variety of more convenient types of reusable water
bottles varying in size and design that cater to the different needs and interests of users.
Marketing PlanTarget Market & Market Segmentation
The target market for Trifecta is active young adults aged 18-54. According to the
USDA3, this is typically the most active age group and the group with the highest water
consumption. These people play sports, hike, do yoga, or participate in other similar activities.
These people tend to be healthier and more concerned with their outward appearance, which
includes accessories such as a reusable water bottle. They also tend to find new trends and
technology as an attractive “must have”. A critical segment of this target market is women, as
their families health and wellness are important to them. These women live comfortable
lifestyles with discretionary income. According to a study conducted at Duke University, 70%
of women regularly use a reusable water bottle. Trifecta’s secondary target market is people
with medical conditions that require them to drink a very specific amount of water per day. The
most common condition related to this is ESRD, a disease that deteriorates the efficiency of the
kidneys and is most commonly placated by drinking an above average amount of water. The
Company also targets cities where the sale of disposable water bottles has been banned such as
San Francisco, CA, Mount Shasta, CA, and Concord, MA.
Demographics Trifecta targets people who are active, eco-friendly, and health-conscious. According
to the IHRSA4, The largest group of gym members (by age) is adults ages 25 to 54 with the
average age being 40. According to a study done at Duke University, 73% of college students
owned one or more reusable water bottles. Trifecta also attracts people who enjoy new and
trendy apps.
GeographicsDue to the online nature of the business, Trifecta is able to ship worldwide and thus is
not limited to a specific geographical region. The United States is the largest consumer market
for bottled water in the world, so Trifecta will focus its marketing effort there. Americans drink
an average of 30.8 gallons of bottled water per year. Trifecta targets the areas where the sale of
plastic water bottles has been banned such as San Francisco, CA, Mount Shasta, CA, and
Concord, MA.
Psychographics
Trifecta provides people the opportunity to be environmentally conscious and to do their
part in the fight against plastic bottle waste. Users feel a sense of responsibility and necessity to
improve the growing environmental crisis. The Company takes advantage of the recent health
craze throughout America to live healthier and save the planet. People are more inspired than
ever to maintain a healthy lifestyle and feel rewarded by doing their part in preserving the earth.
The bottles offer users a chance to feel stylistic and trendy as Trifecta’s bottles have a sleek and
modern design.
BenefitsTrifecta’s products allow users to maintain a hydrated, healthy, and environmentally
friendly lifestyle. Through the mobile apps, users are constantly reminded to stay on track with
their hydration goal and are able to conveniently track their water consumption. When
consumers use Trifecta’s bottles they help reduce the 35 billion plastic water bottles that are
thrown into landfills each year. This investment will save consumers an average of $500 a year.
Marketing Mix
ProductTrifecta offers eco-friendly reusable water bottles that allow users to keep track of their
daily water consumption, contribute to the growing minimization of bottled water waste, and
positively affect their environment… one bottle at a time. The Company provides four
innovative bottles that are all made from BPA free plastic. According to the New York Times,
Bisphenol A (BPA) is a harmful chemical found in disposable water bottles that seeps into the
water. BPA can cause heart disease, cancer, asthma, and more.Trifecta’s products are designed
to satisfy the user's preferences and needs while keeping safety in mind.
HidrateSpark™ Smart BottleThe HidrateSpark™ bottle is Trifecta’s most innovative product.The
sensor stick inside the bottle automatically tracks how much water
you drink throughout the day. It sends information to the
HidrateSpark™ app on your phone via bluetooth and glows when it’s
time to drink more water. The bottle is powered by a small battery
that is easily replaceable and lasts over a year.
Filtered Water Bottle: TriFilterThe TriFilter is a clear, filtered water bottle. The carbon filter in the
cap filters out chlorine and organic contaminants from the water as
the user takes a drink. The bottle and filter are made from FDA
approved recycled PET plastic. They are both Phthalates and PVC
free, which are harmful contaminates commonly found in plastics.
For optimal use, users should replace their cap filter every two
months or every 40 gallons. Trifecta offers replacement filters in
packs of two that can be purchased online.
Fruit Infused Water Bottle: TriFuseThe fruit infused bottle is made up of three parts; the lid, the bottle
and the fruit infuser basket. Each piece is dishwasher safe. After
removing the lids of these bottles, users can place their desired fruit
into the removable ‘fruit basket.’ The bottle is FDA approved for use
with any drinkable liquid. The fruit infused bottle fits easily in most
cupholders.
Insulated Bottle: TriFrostThe TriFrost Bottle features an impact-resistant double wall that
withstands freezing to boiling temperatures. The TriFrost bottle has a
re-freezable built-in gel pack that eliminates the need for ice. The
bottle keeps drinks cold for hours without the watered down effect of
ice.
Trifecta APP The Trifecta app is used for all other bottles the Company offers.
Starting with the user's height, weight, age, and activity level, the app
calculates how much water each user should be drinking throughout
the day. Using the user's location, the app adjusts their daily water
goal depending on the temperature, humidity, and elevation of their
surroundings. Due to the app’s user friendly interface, the user can
easily input how much water they have drank throughout the day. The
user is able to set reminders to stay on track in order to progress
towards their daily goal. The app is able to tell the user how much
money and how many plastic bottles the user has saved by using the
information the user has input into the app to track their daily goals.
The app is available for iPhone and Android devices.
PricingTrifecta’s pricing strategy was created in order to maximize
sales. It was based on wholesale cost of the items, it’s competitors, and
customer willingness to pay for each item. The Company sells the
bottles at 65% of retail price to gyms and colleges in order to maximize distribution
opportunities.
Product Wholesale Price to Gyms and
Colleges
Retail Price
HidrateSpark Smart Bottle $38.95 $59.95
Filtered Water Bottle $6.50 $9.99
Replaceable Filter 2 Pack Only sold online $9.99
Gel Bottle $12.99 $19.99
Fruit Infused $9.75 $14.99
Placement (Distribution)Trifecta offers all of its products online through an easy buying process at
Trifectabottles.com. It also distributes its bottles through various real world and Virtual
Enterprise firms. Trifecta has distribution contracts with gyms and colleges such as Rock
Fitness, NC3 Gym, Nutrishop, Starbucks, University of California Santa Cruz, and San Diego
State University. The distribution of sales are: online sales at 46.1%, trade show sales at 4.6%,
VE contracts at 2% and real world contracts at 47.3% of our total revenue.
Promotion Trifecta’s promotional objective is to
appeal mainly to active people between the ages of 18-
54 who strive to lead healthier lifestyles. The
Company has a $36,000 yearly marketing budget for
advertising. Trifecta advertises on the Virtual
Enterprise website through the virtual company Exorbia. Trifecta has a strong social media
presence on sites such as Pinterest, Instagram, Facebook, Tumblr, and Twitter allowing the
Company to participate in events, post photos, create contests, and receive feedback on its
products. Trifecta attracts additional users through various gyms and fitness centers that
distribute Trifecta’s bottles.
In the Trifecta app users are asked to input an email as they create their account. This is
used to directly contact customers with information on new products, promotions, and health
tips. Trifecta takes advantage of endorsements with Ban the Bottle and Travelers Against Plastic
that list Trifecta as their preferred reusable water bottle company. This builds trust and
credibility among customers, in order to promote itself as an eco-friendly company. This
contributes to Trifecta’s mission to promote care for the environment and the reduction of
plastic waste.
PositioningTrifecta positions itself as a prominent water bottle provider in the industry. The
Company strives to redefine the image of water bottles through its unique, innovative designs.
Users feel modern and trendy as they use Trifecta’s products. Trifecta offers users the
opportunity to maintain a healthy lifestyle, while also benefitting the environment. Trifecta aims
to take an active role in environmental conservation by working with select gyms and
universities in order to raise awareness of the necessity to protect the environment from plastic
bottles. Trifecta’s goal is to capture the attention of potential consumers and inform them of the
issues that waste of disposable water bottles cause. The Company strives to positively affect
each user’s lives through the conveniency of its product, as it advocates to live a hydrated life.
Business RisksTrifecta’s biggest risk is the reliance on outside manufacturers for Trifecta’s products.
All of Trifecta’s products are purchased through individual wholesalers. If these businesses
were to stop manufacturing these bottles, Trifecta will have to source new manufacturers to
purchase these bottles from. Another risk Trifecta faces is the loss of contracts from gyms and
universities. Trifecta addresses this risk by having its contract specialist continually making new
contracts with distributors.