Caleb's Kola Marketing Plan
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Transcript of Caleb's Kola Marketing Plan
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Arlina Cai, Gabriel Kates, Han Ren Lim, Steven Lukens, Robert Petts, Stephanie Zheng
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AGENDA
• Context• Caleb’s• Competitive Landscape• Addressing the Challenge• Strategy• The Marketing Mix: 4Ps
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• Per capita soft drink consumption is decreasing
• The soft drink industry is declining at a more rapid rate
CONTEXT
• Consumer awareness of the negative effects of soda consumption• Obesity and diabetes epidemic
• Increase in soda prices due to increased prices of corn and sugar
The soda industry as a whole is in decline
Additional Facts
Key drivers of decline
Retail sales of U.S. carbonated soft drinks
Sources: IBISWorld Business Environment Profile: Per capita soft drink consumption, Mintel Carbonated Soft Drinks - US - 2014
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Page 1
Craft soda is 1% of the soda market in terms of units
CONTEXT
= 90 million cases
Craft soda
Sources: CNBC 2014
But the craft soda market is emerging
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Page 1
CONTEXT
Sources: Mintel Carbonated Soft Drinks - US - 2014
The craft movement is being driven by new social trends and changes in consumer taste
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CONTEXTPeople buy craft soda
because
Reasons People buy Carbonated Soft
DrinksLike the flavor
For refreshmentTo have as a treat
A favorite beverageFor energy
For Convenience
Reasons People Buy Craft Soda
Better taste
Authenticity
Quality
Smaller batches
Sources: Mintel’s Carbonated Soft Drinks - US - June 2014, Five Star Soda, PMQ
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What is Pepsi doing to leverage this trend?
CALEB’S
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Pepsi is moving into the craft soda industry with Caleb’s Kola
Ingredients
1. Kola nuts from Africa2. Sustainable fair trade cane
sugar3. “A special blend of spices from
around the world”4. Citrus5. Sparkling water
Nutrition Facts10 ounce glass bottle
110 calories29 grams of sugar
0 grams of fat50 milligrams of
sodium50 milligrams phosphorus
Current Distribution Channels
(Collaborators)
Current Customers
NYC Area (Brooklyn focus)Pizza eaters
Costco shoppersDeli patrons
Restaurant goers
Sources: Caleb’s Website
~100 retail stores (sold by bottle)9 Costcos (sold by case)
32 restaurants (sold by bottle)
CALEB’S
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Weaknesses
Strengths
Sources: Caleb’s Website
• Lack of Awareness in target market
• Lack of Understanding
• Lack of Availability
• Lack of Attractiveness
• Overall ineffective at attracting new customers
• Access to large distribution networks via Pepsi
• Economies of scale
CALEB’S
Caleb’s currently has more weaknesses than strengths
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BUT Caleb’s value proposition offers consumers a premium craft soda
• High quality ingredients - kola nuts, cane sugar
• Sustainable sourcing of ingredients
• Taste• Thirst quenching• Product design• #honorincraft - coolness• Caffeine• Champagne like fizz
• Price• Limited availability• Calories• Sugar• Caffeine
Sources: Caleb’s Website
CALEB’S
CostsBenefits
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Sources: Caleb’s Website
The core competencies and strategic assets How Caleb’s can leverage it
Cash Sustainable sourcing of premium ingredients
Existing distribution channelsCaleb’s can piggy back on current
distribution channels to get Caleb’s into more restaurants and stores
Economies of Scale Can provide a better product for cheaper
Relationships and experienceCaleb’s can use Pepsi’s professional
network and use Pepsi’s experience to optimize operations
CALEB’S
Caleb’s optimal value proposition leverages its core competences and strategic assets
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We need to differentiate Caleb’sin a way that is conducive to achieving our
goals.
COMPETITIVE LANDSCAPE
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Sources: Mintel’s Carbonated Soft Drinks - US - June 2014, Five Star Soda, PMQ
CALEB’S
Value Refreshment Seeker
Energy Seeker
Mixer Seeker Foodie Treat
SeekerHealth Seeker
Flavor M/H L H H H M
Fizziness L/M L H H M L
Thirst Quenching H L L M L M
Caffeine L H L L L L
Convenience H H M L L L
Authenticity L L L/M HH H H
Healthy L L L M/H M H
All natural ingredients L L L H H H
Pairs well with food L L M HH M L/M
Good for mixing L L H M L L
Heritage L L L H M M
Price H M M L L L
Soda customers value these attributes
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Additional Brands: Dr. Browns, San Pellegrino, Hansen Beverage Company, SABMiller Holdings inc., Thomas Kemper Soda Co.
Products: Soda is basically all these companies offer. But many companies do offer different flavored sodas and diet versions of those flavors.
JONES
REED’S SODA
BOYLAN
Sources: Google Images, Reed’s Soda 2014 10-K, Boylan’s Website, Jones Soda Websites, Reed’s Soda Website, Izze’s Website
COMPETITIVE LANDSCAPE
*Please refer to our competitors’ tab for more information
GROWN UP SODA
Caleb’s has strong competitors
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High
Medium
Low
Flavor FizzThirst
Quenching
Caff. Conv. Authen. HealthyAll
Natural Ingredie
nts
Pairs well with food
Good for
MixingHeritage Price
Sources: Google Images, Reed’s Soda 2014 10-K, Boylan’s Website, Jones Soda Websites, Reed’s Soda Website, Izze’s Website
COMPETITIVE LANDSCAPE
Caleb
’s
Jones
Reed’s/Virgil’s
Boylan
GuS
Caleb’s competitors have many different value propositions
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Values Caleb’s Jones Reed’s/Virgil’s Boylan GuS
Flavor M/H M H H HFizziness H M/L M/L M/L M/L
Thirst Quenching M L H H H
Caffeine M H H H LConvenience L L L H M/HAuthenticity H L M/H M (decr). M
Healthy H L M M HAll natural ingredients H L H H M
Pairs well with food H L L M M/H
Good for mixing L/M L M H HHeritage M/H L L H L
Price H L M L M
Sources: Caleb’s Website, Boylan’s Website, Jones Soda Websites, Reed’s Soda Website, Izze’s Website
COMPETITIVE LANDSCAPE
Caleb’s competitors have many different value propositions
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ADDRESSING THE CHALLENGE
Values Caleb’s
Flavor M/H
Fizziness H
Thirst Quenching M
Caffeine MConvenience LAuthenticity H
Healthy HAll natural ingredients H
Pairs well with food H
Good for mixing L/M
Heritage M/H
Price H
Value Foodie
Flavor HFizziness H
Thirst Quenching MCaffeine L
Convenience L
Authenticity HHHealthy M/H
All natural ingredients H
Pairs well with food HH
Good for mixing M
Heritage H
Price L
Sources: Mintel’s Carbonated Soft Drinks - US - June 2014, Five Star Soda, PMQ
The Foodies’ values align best with Caleb’s value proposition
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ADDRESSING THE CHALLENGE
Value Foodie
Flavor HFizziness H
Thirst Quenching MCaffeine L
Convenience L
Authenticity HHHealthy M/H
All natural ingredients H
Pairs well with food HH
Good for mixing M
Heritage H
Price L
Sources: Mintel’s Carbonated Soft Drinks - US - June 2014, Five Star Soda, PMQ
How did you hear about new flavors and ingredients?
• Value experiences with food• Adventurous flavors• Artistic and/or creative
• “Creative Class Millennials”• Love sharing photographs of their food• Spread food ideas through word-of-
mouth• Social media and food bloggers
Who are foodies? What do they value?
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Sources: Mintel
ADDRESSING THE CHALLENGE
• Millennials care about quality• Are adventurous and want to try new
things• Grew up with social media
The profile of Foodies fit the description of the Millennials
Value Foodie
Flavor HFizziness H
Thirst Quenching MCaffeine L
Convenience L
Authenticity HHHealthy M/H
All natural ingredients H
Pairs well with food HH
Good for mixing M
Heritage H
Price L
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ADDRESSING THE CHALLENGE
Retail Sales $10,000 Net Revenues 5,000COGS
(3,250)Distribution Costs
Gross Profits 1,750Marketing Budget (1,000)
Marketing Contribution $750
Given a marketing budget of $1 million$10MM in retail sales / $1.75 per bottle = 5,714,286 units of Caleb’s
Caleb’s P&L (in thousands)
Caleb’s financial goal is to reach $10 MM in retail sales by Dec. 31, 2015
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How will Caleb’s achieve its financial goal?
STRATEGY
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STRATEGY
Cities % Millennials in Population
# Millennials in Population
Austin 16% 141,664Salt Lake City 15% 28,677
Portland 15% 91,418
Los Angeles 14% 543,802
Denver 14% 90,930
D.C. 14% 92,245
Houston 14% 307,440Las Vegas 14% 84,489
San Francisco 14% 117,242Dallas 14% 176,120
Manhattan1 30% 484,800
• There are high concentrations of Millennials in the West
• Focus on college towns
Key Facts about Millennials
Sources: U.S. Census Bureau, Nielsen’s Millennials – Breaking the Myths
The percentages of Millennial concentration are very similar, so we are looking mostly at the nominal # of millennials in the population.
1 Manhattan is not technically a city, but a borough of NYC
The following cities have high concentrations of milennials and are potential markets for Caleb’s
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STRATEGY
Sources: U.S. Census Bureau, Nielsen’s Millennials – Breaking the Myths
The five markets combined creates a potential market size of 1.378 million
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Heavy Consumers
Moderate Consumers
Light Consumers Total
Penetration Rate 10% 30% 60% 100%
# of Buyers 13,789 41,368 82,736 137,893
Purchase Frequency 208 36 18 -
Purchase Quantity 2,868,166 1,489,250 1,489,240 5,846,646
To reach our financial goal
we are assuming 10% yield
STRATEGY
Sources: Elaborations on craft soda market
2 This number comes from the P&L
We need to reach approximately 1.37 million people in order to achieve sales of approximately 5.7 million2
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Sources: Caleb’s Website, Competitors’ websites
STRATEGY
So how should Caleb’s position itself to attract this target?
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We don’t want to compare ourselves to any other craft sodas in the market because we don’t have a main competitor. We don’t want to dominate the market, but rather want a healthy portion of it.
Rationale
STRATEGY
Non-Comparative Positioning Statement
Caleb’s is the craft soda for foodies because it has a smaller and more champagne like fizz which pairs better with food because the fizz does not dominate the meal.
We think that the non-comparative positioning statement is best
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Sources: Google Images, Reed’s Soda 2014 10-K, Boylan’s Website, Jones Soda Websites, Reed’s Soda Website, Izze’s Website
Create Awareness
Create Trial
Create Understanding
Create Attractiveness
Create Availability
Caleb’s is a new brand, so brand awareness is extremely low.
Because Caleb’s is a new brand, customers do not know their value proposition.
Caleb’s needs to convince consumers that it is an attractive product
Caleb’s has very limited availability, so customers who want Caleb’s will be very discouraged when they can’t find it available in stores.
We need to work on all of the above to get customers to try the product.
Repeat!
STRATEGY
Caleb’s should focus its marketing goals on creating awareness and understanding
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Implementation: The Marketing Mix
THE MARKETING MIX
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THE MARKETING MIX: Product
Why?
Because we want Caleb’s drinkers to think of an indulgent experience whenever they see or drink Caleb’s
The essence of the Caleb’s brand is indulgence
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THE MARKETING MIX: Product
Caleb’s core product benefit is high quality indulgence
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THE MARKETING MIX: Product
To convey our positioning, Caleb’s association with food must be strengthened
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Add a tag to the back of the bottle explaining the bubbles
Sources: Google Images
THE MARKETING MIX: Product
#CalebsCompletes encourages consumers to share their food pairings on social media
This description of the bubbles increases consumer understanding of Caleb’s and increases the value that consumers see in Caleb’s.
Add a tag to the back of the bottle explaining why its bubbles are better with food
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Sources: Primary market research, Caleb’s website
THE MARKETING MIX: Place
To maintain the authenticity of the brand, we should be looking to restaurants/cafes that are more intimate/small.
Choosing the right restaurants will enhance our reputation with foodies
Ideal restaurant profile should be in line with our brand identity of indulgence/authenticity
58% Would drink soft drinks with pizza
42% Would drink soda with burgers
We would like to move into pizza and burger restaurants
because according to our market research
We want to continue expansion into more restaurants
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Sources: Numbers based on 100-300 average restaurant goers per day in a restaurant
THE MARKETING MIX: Promotion
Bottle purchases per day 20Bottle purchases per month 600Case sales required to reach goal (12 bottles/case) 50Order Frequency 12Total Orders per year 600
Number of restaurants required to achieve goal 800Number of cities expanding into 5Number of restaurants required per city ~160
3 Please refer to index for a detailed breakdown
In order to reach our financial goal, we need to target about 160 restaurants in each city3
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Trade Promotion (push tactics)
Consumer Promotion (pull tactics)
• “Buy one get one” deals
• Display Caleb’s on the counter with sample food
• Give out free stickers with the cases for restaurants and cafes to give to their customers
• Sampling
• Increase social media presence through bloggers
• and through #CalebsCompletes campaign
• Recommendations on what food to pair with Caleb’s (with possible alteration to packaging to include something about this on the bottle)
THE MARKETING MIX: Promotion
Goal: Increase awareness and induce trial
Goal: Obtain initial distribution
We recommend the following tactics
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To increase awareness of Caleb’s, we recommend spending on stickers, blogger collaborations, and sampling4
Sources: Google Images, Mintel’s Innovation on the Menu: Flavor Trends - US - June 2014
THE MARKETING MIX: Promotion
$513K Stickers$40K Bloggers$447K Sampling$1 M Total
Marketing Budget Allocation
4 Please refer to index for a detailed breakdown
To increase awareness of Caleb’s, we recommend spending on stickers, bloggers, collaborations, and sampling4
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Moving into the future
STRATEGY
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Sources: Google Images, Mintel’s Innovation on the Menu: Flavor Trends - US - June 2014
THE MARKETING MIX: Place
“influential foodies to connect and share ideas and recipes. Unfortunately, for the restaurant industry, this has created a league of confident, at-home cooks that have been inspired by beautiful pictures, blog posts, boards, and pins found on the internet, and have been replicating or creating their own one-of-a-kind dishes at home versus going out to eat.”
We need a way to enter into foodies’ at home eating occasions
Foodies are eating out, but they are also eating at home more
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Niche supermarkets like Whole Foods is the next step for Caleb’s distribution.
Sources: Google Images, Mintel’s Innovation on the Menu: Flavor Trends - US - June 2014
THE MARKETING MIX: Place
The number of niche format super markets like Whole foods are growing by 69%
Niche supermarkets like Whole Foods is the next step for Caleb’s distribution
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Sources: Google Images, Mintel’s Innovation on the Menu: Flavor Trends - US - June 2014
THE MARKETING MIX: Place
Foodies go to supermarkets like Whole Foods because they buy the most organic goods out of all consumers and Whole Foods caters to this type of food consumer 6
Whole Foods’ brand image would give credibility to Caleb’s authenticity and high quality core and essence
Niche supermarkets like Whole Foods is the next step for Caleb’s distribution
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Thanks
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GUS
GROWN UP SODA
Sources: Google Images, Reed’s Soda 2014 10-K, Boylan’s Website, Jones Soda Websites, Reed’s Soda Website, Izze’s Website
• Founded in 2003• Emphasis on 100% Natural• “Not too sweet,” 90-98
Calories
• Social Media Platforms: Facebook, Instagram, Twitter
• Wide distribution, available for purchase in most states
• “Dry” sodas: blackberry, cola, pomegranate, Valencia orange, Meyer lemon, cranberry lime, root beer
• “Extra Dry” ginger ale• Star ruby grapefruit
Key Facts
Product Line
Promotion and Communication
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Index
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Sources: Numbers based on our calculations for bottles from P&L
THE MARKETING MIX: Place
Retail Sales $10,000,000
Net Revenues 5,000,000COGSDistribution Costs
(3,250,000)
Gross Profits 1,750,000Marketing Allocation
Stickers (513,000)Sampling (447,000)Bloggers (40,000)
Marketing Budget (1,000,000)
Marketing Contribution
$750,000
Retail Sales $10,000,000
Bottles Required to Achieve Target
5,714,286
Potential Market Size 1,378,893Yield 137,893
Heavy User
Moderate User Light User
Penetration Rate 10% 30% 60%# of Buyers 13,789 41,368 82,736Purchase Frequency
208 36 18
Purchase Quantity 2,868,166 1,489,240 1,489,240Assumptions:
Bottles required to achieve target sales is based on $1.75/ bottle10% yield of potential marketHeavy users consume 16 times a monthModerate users consumer 3 times a monthLight users consume 1.5 times a month
2
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3 In order to reach our financial goal, we would need to target about 160 restaurants in each city
Sources: Numbers based on our calculations for bottles from P&L
THE MARKETING MIX: Place
Target goal (Units) = 5.8 million = 480,000 cases (assuming 12 bottles per case)
Estimated number of bottle purchased per restaurant/cafe per day: 20Estimated number of bottles required per restaurant/cafe per month:600 (20 x 30)Estimated number of cases: 50 (600 / 12)Estimated order frequency: MonthlyTotal order size: 600 per year
Number of restaurants to meet the target goal: 800 ( 480,000 / 600)Number of cities to expand into: 5Number of restaurants/cafe per city:~160 (800 / 5)
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4 Elaborations on the budget allocation
Sources: Numbers based on our calculations for bottles from P&L
THE MARKETING MIX: Place
Stickers 3 stickers per bottle 12 bottles per case
Selling 475K cases this year
17.1 million total stickers needed for distribution
Assuming
each sticker costs 3 cents to make (a conservative
estimate because online purchase price is 3 cents for
average consumers)
17.1 million x .03
$513K total spending on
stickers
Bloggers
$8K to collaborate with each blogger because
commissions even for small bloggers can average in the
thousands
5 bloggers$40K spending
on blogger collaboration
Sampling We are distributing the rest of our budget for sampling
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5 Caleb’s is in the Introduction phase, moving into the growth phase of the product life cycle
Sources: Google Images, Product Handout
THE MARKETING MIX: Product
Characteristics of Caleb’s in the Market:- Small, but growing, market size- Market growth is increasing from low to higher- Competition is increasing from low to higher- Product is still limited- Distribution is still limited- Price is still penetration/skimming- Promotion is still on awareness and is beginning to stress positioning
![Page 48: Caleb's Kola Marketing Plan](https://reader036.fdocuments.net/reader036/viewer/2022062523/58ed0c291a28ab0b348b45d1/html5/thumbnails/48.jpg)
5 Caleb’s is in the Introduction phase, moving into the growth phase of the product life cycle
Sources: Google Images, Product Handout
THE MARKETING MIX: Product
Characteristics of Caleb’s in the Market:- Small, but growing, market size- Market growth is increasing from low to higher- Competition is increasing from low to higher- Product is still limited- Distribution is still limited- Price is still penetration/skimming- Promotion is still on awareness and is beginning to stress positioning
![Page 49: Caleb's Kola Marketing Plan](https://reader036.fdocuments.net/reader036/viewer/2022062523/58ed0c291a28ab0b348b45d1/html5/thumbnails/49.jpg)
Primary Research
We used a survey to find out how college consumers viewed pairing soda with their food. These results may be a bit skewed because we only surveyed NYU students, but we also believe that these results are most consistent with those that we would find in our recommended cities.
Survey Results
![Page 50: Caleb's Kola Marketing Plan](https://reader036.fdocuments.net/reader036/viewer/2022062523/58ed0c291a28ab0b348b45d1/html5/thumbnails/50.jpg)
Sources: Google Images, Reed’s Soda 2014 10-K, Boylan’s Website, Jones Soda Websites, Reed’s Soda Website, Izze’s Website
Superior fizz
Inferior fizz
Good Taste
Caleb’s
Bad Taste
Reeds Boyla
nJones
STRATEGY
GuS
Caleb’s should position itself on its high quality fizz and …
![Page 51: Caleb's Kola Marketing Plan](https://reader036.fdocuments.net/reader036/viewer/2022062523/58ed0c291a28ab0b348b45d1/html5/thumbnails/51.jpg)
Sources: Google Images, Reed’s Soda 2014 10-K, Boylan’s Website, Jones Soda Websites, Reed’s Soda Website, Izze’s Website
Pairs well with food
Caleb’s
Doesn’t pair well with food
Reeds Boyla
n
Jones
STRATEGY
Superior fizz
Inferior fizz
GuS
Caleb’s should position itself on its high quality fizz and “pairs well with food”