Snapple/Dr Pepper Study
1. How would you characterize the energy beverage category and competitors in late 2007?
The energy drink market is very competitive as it has several major brands in play. These brands include Red Bull, Monster Energy, Rockstar, and PepsiCo’s AMP. The major purchases of the energy drinks are made in the convenience stores, supermarkets, and mass merchandisers as they account of 71% of the retail sales compared to 29 percent of sales made in restaurants and night clubs (Kerin & Peterson, 2010). The market for 2007 to 2011 was predicted to have a 10.2 percent growth rate. Red Bull currently dominates the Energy drink as it boasts an estimate of 43% of dollar sales in 2006 while the closest competitor has a 16% of the sales share (Kerin & Peterson, 2010). It is becoming a fad as I have noticed that there are many new energy drink flavors entering the market and I know that my wife is addicted to those as she drinks one a day in lieu of coffee.
2. Does your characterization bode well for a new energy beverage brand introduction generally and for Dr. Pepper Snapple Group, Inc. in particular?
The competition for the energy drink is tight as PepsiCo , Coca-cola, and Red Bull are heavily involved in this market. The growth is there and poses an opportunity but it will be tough to snag some of the shares. A friend of mine who owns and operates a home-based business selling XB-Fit energy drinks (http://xbfit.net/) said that he faces 2 major challenges when it comes to selling the energy drinks. One challenge is to sway the consumers try their product and pry them away from other brands. The second challenge is assuring consumers that new energy drinks are safe as many health concerns regarding the energy drinks have come up. Dr. Pepper Snapple Group has the distribution ability to deliver and the resources to market the energy drinks, but the marketing campaign will have to be the biggest campaign that the Dr.Pepper Snapple Group has ever done. In my
The energy drink market is very competitive as it has several major brands in play. These brands include Red Bull, Monster Energy, Rockstar, and PepsiCo’s AMP. The major purchases of the energy drinks are made in the convenience stores, supermarkets, and mass merchandisers as they account of 71% of the retail sales compared to 29 percent of sales made in restaurants and night clubs (Kerin & Peterson, 2010). The market for 2007 to 2011 was predicted to have a 10.2 percent growth rate. Red Bull currently dominates the Energy drink as it boasts an estimate of 43% of dollar sales in 2006 while the closest competitor has a 16% of the sales share (Kerin & Peterson, 2010). It is becoming a fad as I have noticed that there are many new energy drink flavors entering the market and I know that my wife is addicted to those as she drinks one a day in lieu of coffee.
2. Does your characterization bode well for a new energy beverage brand introduction generally and for Dr. Pepper Snapple Group, Inc. in particular?
The competition for the energy drink is tight as PepsiCo , Coca-cola, and Red Bull are heavily involved in this market. The growth is there and poses an opportunity but it will be tough to snag some of the shares. A friend of mine who owns and operates a home-based business selling XB-Fit energy drinks (http://xbfit.net/) said that he faces 2 major challenges when it comes to selling the energy drinks. One challenge is to sway the consumers try their product and pry them away from other brands. The second challenge is assuring consumers that new energy drinks are safe as many health concerns regarding the energy drinks have come up. Dr. Pepper Snapple Group has the distribution ability to deliver and the resources to market the energy drinks, but the marketing campaign will have to be the biggest campaign that the Dr.Pepper Snapple Group has ever done. In my
References: Kerin, Roger A. & Peterson, Robert A. (2010). Strategic Marketing Problems Cases and Comments (12th ed.). New Jersey: Pearson Prentice Hall.