Dr. Pepper Snapple Group Case Study

1520 Words Feb 13th, 2014 7 Pages
DISCUSSION QUESTIONS FOR DR. PEPPER SNAPPLE GROUP

_1. HOW WOULD YOU CHARACTERIZE THE ENERGY BEVERAGE CATEGORY, COMPETITORS, CHANNELS, AND DPSG'S CATEGORY PARTICIPATION IN LATE 2007?_

In late 2007 the energy beverage category was reaching market maturity and projected to have a slower annual growth rate from 2007 to 2011 (10.5%) than it had between 2001 and 2006 (42.5%). Rising prices, packaging competition, and the introduction of hybrid energy beverages also added to the slower projected growth rate. However in 2007 the market still saw growth of 32%.

The category is dominated by 5 major brands (94% of dollar sales), with Red Bull far above the pack with a 43% dollar sales market share. The other 4 are in close competitions with
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DPSG on the other hand has the brand loyalty, equity, image, and budget to support such a venture. It also has some unique qualities such as the addition of protein, a larger, re-sealable bottle, and an emphasis on performance over simply something to perk the consumer up. Since DPSG already has a target market, distribution network, and manufacturing set up, it could feasibly enter the market on the shoulders of its good name. The fact that DPSG has differentiated itself from the other brands also gives them a leg up. If it could successfully attract more consumers from the 35-54 year old range by riding its healthy image and promoting a healthier, more fulfilling energy beverage, it could that target market and become a great competitor.

_3. WHAT TARGET CONSUMER MARKET SHOULD BE CHOSEN FOR A NEW ENERGY BEVERAGE BRAND?_

An opportunity lies in the 35-54 year old range. It is a market that does not receive much attention and is not specifically targeted. Since this target market consumes only slightly less than the 24 and under market, there is a great opportunity to promote a product that suits their needs and advertisements that speak to them. By capturing that market, DPSG will stay consistent with its brand image and give it the awareness and experience to begin transitioning into the 12-34 year old market in the

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