Snapple Marketing Case
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Transcript of Snapple Marketing Case
Case HistoryIn 1994, Quaker acquired Snapple at the height of its popularity for $1.7 billion. Quaker made a series of changes, disaffecting Snapple’s most loyal customers and tarnishing the brand’s image, resulting in declining revenue. In 1997, Triarc acquired Snapple for $300 billion, and needed a strategy to turn the brand around.
Challenges
Objective
+ 116%
Increase revenue to $1 billion within the next 5 years
Competitor Analysis: Brand Image
HealthyUnhealthy
Mainstream
Unique
Supermarket Brand Shares 1997
Market Share is indicated by relative circle size.
Objective Brand Image
HealthyUnhealthy
Mainstream
Unique
Supermarket Brand Shares 1997
Healthier and more unique
Grow market share
Customer Analysis
Customer Value Proposition
“For the quirky consumer who needs a break
from a busy day, Snapple is a
flavorful, healthy choice.”
To achieve the objective brand image, Snapple needs a value proposition that will resonate with its target
market.
Recommendations Overview
Product Line Renovation Unique Flavors
Cap Fact: Queen Victoria offered a
reward of 100 pounds to anyone
who could bring her a fresh Mangosteen
Offering a line of unique flavors maintains Snapple’s quirky image while differentiating them from competitors
MANGOSTEE
N MANGOSTEE
N
Product Line Renovation
IMMUNE HEALTH
Immune Health: Fortified with vitamins to help strengthen your
Immune System
Snapple Plus
The Snapple Plus Line moves Snapple toward a healthier brand image
Protein Plus: Packed with protein to help build muscle
Product Line RenovationSnapple Boost
All natural energy boosting ingredients
The Snapple Boost Line competes with the energy drink market by providing a healthier alternative for target customers with fast-paced lifestyles
BoostBoost
Promotion
?
PlacementNot only should Snapple appeal to lost customers,
but it should also bring in new customers by creating new sales channels
PlacementSchool Vending Machines
Snapple will appeal to school
boards and parents as a
healthy alternative in a
beverage market saturated with soda products
PlacementThe Snapple
Store
Flagship stores in
metropolitan areas will
be an integration
of marketing
efforts
Timeline
Financial SummaryProduct Line RenovationProduct Line Renovation
$140,000 one time + $140,000 annually$140,000 one time + $140,000 annuallySnapple StoreSnapple Store
$650,000 annually$650,000 annuallyLabel Design ContestLabel Design Contest
$19, 600$19, 600TV AdvertisingTV Advertising
$1.6 million annually$1.6 million annuallyVending machine contractsVending machine contracts
$12 million annually$12 million annually
TOTAL $14.5 million for all recommendationsTOTAL $14.5 million for all recommendations
Cost Analysis: New Flavors Exotic FruitsExotic Fruits
4/year x $35,000 each = $140,000 annually4/year x $35,000 each = $140,000 annually
Snapple BoostSnapple Boost One energy formula $35,000One energy formula $35,000 Snapple PlusSnapple Plus
3 formulas x $35,000 each= $105,0003 formulas x $35,000 each= $105,000
TOTAL $280,000TOTAL $280,000
Cost Analysis: TV Advertising$100,000 (Production Cost) +$100,000 (Production Cost) +$300,000 (air a 30-second ad) x 5 slots / season$300,000 (air a 30-second ad) x 5 slots / seasonTOTAL $1.6 million annuallyTOTAL $1.6 million annually
Cost Analysis: Vending MachineVending Machine
($1,500/machine) x (2 machines/school) x (3,600 schools/year) = $10.8 million/yr for 3 yrs
Personal SellingSalary ($60,000/ year) x employees (20) = $1.2
millionRestocking
Existing DistributorsTOTAL = $12 million
Cost Analysis: Snapple StoreStore Operation Store Operation
$500,000 / yr$500,000 / yrRental Cost Rental Cost
$150,000 / yr$150,000 / yrTOTAL= $650,000 annually per storeTOTAL= $650,000 annually per store
Cost Analysis: Label Design Contest$10,000 prize$10,000 prizeInfo Sessions/ Advertising Info Sessions/ Advertising
2 representatives(travel and board), 1 intern $3,3002 representatives(travel and board), 1 intern $3,300Posters/handouts $4,400 Posters/handouts $4,400 Labor $8 x 8hrs x 3days x 10schools = $1,920Labor $8 x 8hrs x 3days x 10schools = $1,920
Top 10 Art SchoolsTop 10 Art Schools
TOTAL $19,600TOTAL $19,600