The Five Forces Analysis Of Glanbia's Global Performance Nutrition Business

Gatorade is a flagship brand of PepsiCo and has a commanding 75% market share of the sports nutrition beverage marketplace globally, being sold into 80 different countries according to the latest PepsiCo annual report published in late 2011. Gatorade's success in branding and product marketing has actually expanded the global market for sports nutrition beverages during the late 1990s and into the 21rst century. Recently however the company has faced many channels including product line extensions of the last decade which failed to deliver strong results (Pollack, 1997) and a more critical analysis of their ingredients as many of their beverages are sold in public schools (Tallon, 2009). Despite these challenges however, Gatorade continues to experience strong market share and growth. The intent of this analysis is to evaluate and provide recommendations for each of the four areas of the marketing mix including product, price, promotion and place or distribution.

The concept of market structures and competitive strategies are important when attempting to compete in any market. Understanding what market structure your product falls under can help companies develop better competitive strategies and identify potential for loss and gains. The athletic footwear industry in the United States is highly profitable and continuously growing. In this paper I will identify market structure of the athletic footwear industry, the major retailers, and competitive strategies that can be used to maximize profits.

For the analysis the packaged food company ConAgra Foods, Inc (CAG) was chosen. According to ConAgra 2013 Annual report, ConAgra Foods, Inc. is one of the USA’s leading food companies. It has a strong brand recognition and consumer loyalty. ConAgra 's products are sold both in large supermarkets and convenience stores. Company operates in Commercial and Consumer Foods segments. The food industry is especially interesting for the research as the demand on food will stay relatively stable even during economic crises and is continuously growing.

As the world’s leader in nutrition, health and wellness, Nestlé collaborates with countless companies across different industries (Goldberg, 2012, para. 86). This enables the company to build a global supply chain, allowing Nestle to generate, buy, and sell agreements through collaborations within the local communities in the countries where the company operates.

The attractiveness of the Ice Cream Industry will be evaluated with Porter’s five forces analysis (Kotabe and Helsen, 2010).

Sports nutrition products are designed to be taken in conjunction with an exercise and fitness regimen. These products include: proteins, mass gainers, pre-workout supplements, during-workout supplements, post-workout supplements, and gluten free products. In total, the sports nutrition sector generated approximately 43% of GNC’s retail sales for 2010. (Reuters, 2011)

Both competition and market size are of major importance when one explores the positioning of a product. In the case of Crescent Pure, this is vital as Ryan must determine the level of competition that will be faced if the product is marketed as either an energy or sport drink. In the case of an energy product, it should be noticed that there is heavy market dominance by Together, Freight, Razor, Torque and Steller, as they account for roughly 85% of the market. Despite this, it should be seen that the average price point for a 5oz can is $2.99 which is notably higher than Crescent’s $2.75 pricing. Additionally, the market size for sport drinks is of particular interest as it is estimated to grow to $8.5 billion by the year 2013. This, coupled with the fact that the market had grown 40% between the period 2010 – 2012, makes this sector of particular interest to PDB.

Gatorade has emerged as the global leader in sports nutrition beverages by continually managing their brand to signify high energy, athletic excellence combine with one of the most efficient new product development and introduced processes in the beverage industry. As a result of being able to consistently synchronize these many components of their business so well, Gatorade today holds a 75% market share in the sports nutrition market globally today. Gatorade is owned by PepsiCo, which has made it possible for the company to sell in 80 countries today. Gatorade relies heavily on the PepsiCo distribution and retail network globally. Gatorades' revolutionary approach to managing branding for beverages has served to increase the total market size for this product category globally (Huang, Sarigöllü, 2012). Despite the continued widespread adoption of Gatorade as a healthy energy drink, the company has encountered resistance to its brand and the ingredients used for creating the many variations of Gatorade energy drinks (Tallon, 2009). Despite these setbacks the Gatorade brand continues to experience exceptional growth and stability over time.

The effect of this aggressive competition can be seen in Figure 2, which shows a sharp decrease in Lucozade’s market share from 2002, following the introduction of Powerade (owned by Coca-Cola) and C&C Club Energise (introduced in 2003) to the market. Every year since 2006, however, has seen Lucozade Sport regain market share, firmly consolidating its position of market dominance in Ireland. This trend endorses the quality of Lucozade Sport’s marketing, as it is succeeding in fighting off stiff competition. “Functional drinks is dominated by Lucozade brand, with Lucozade Energy and Lucozade Sport recording a combined volume (market)  share of  54%  in 2009” as stated in Euromonitor International (2011).

The athletic apparel industry is also defined by a moderate threat of new entrants. As mentioned earlier, the industry is extremely concentrated, with large companies (Nike, Adidas, Under Armour) at the top and several smaller companies following. While the costs for starting a local company is low, as the company grows, it will become harder to compete and be profitable in this industry. The incumbent firms in this industry have the advantage of existing production, distribution, and supply chain processes. New companies would consider the large upfront costs of these processes while incumbent firms take advantage of economies of scale due to having the benefit of already securing a large market share. These large costs in turn cause the company to have low profits, which discourages new entrants. Additionally, the threat of new entrants is low because of the brand preferences of consumers in the economy. This industry

The last two topics within Porter’s Five Force Analysis are the threats of substitutes and new entries. The threat of substitutes for PepsiCo and Pepsi products could be considered quite high. In recent years, Americans have been cutting back soda consumption, approximately 1.2% in 2015, and 0.9% in 2014 (Taylor, 2016). Customers have been replacing soft drinks, in particular, with water, coffees, and all natural juices. This also leads the way for the threat of new entries. As people are tending to lean away from traditional soft drinks, the threat of new entrants could be considered moderate. This is because the cost of entry is relatively low as it is not a technology driven industry. Most of the cost of entry would be related to branding and marketing of the new product (Thompson, 1996). In recent years many competitors have entered the market with desirable ingredients and non-soft-drink beverages.

The following paper will be discussing GNC Holdings Incorporated which is profiled as a retail-food store. As most people already know, GNC is a leading global specialty retailer of health and wellness products, including vitamins, minerals, and herbal supplement products, sports nutrition products and diet products (Investor, 2011). GNC is a publicly traded company that stays compliant with all the laws, rules, and regulations of the New York Stock Exchange as well as presents information that is in accordance with generally accepted accounting principles (GAAP). All information in this paper will be based off the most recently provide annual report, i.e. 2014.

This is a strategic analysis of GlaxoSmithKline that examines the key factors that influence the company and its activities. The strategic analysis will examine key factors in the company’s internal and external environment and their influence on the company’s strategies. GlaxoSmithKline is a global healthcare company that offers pharmaceutical, vaccines and consumer products. The company is a product of various mergers, the latest occurring in 2001 between GlaxoWellcome and SmithKline Beecham. The company started in London United Kingdom in 1715 as Plough Court pharmacy and has evolved to become one of the leading global healthcare companies. The healthcare company operates in more than 150 countries with 89 manufacturing locations and research centers in the USA, China, UK and Belgium. In 2015, the company’s sales grew to £23.9 billion from £23.0 billion in 2014 (GlaxoSmithKline plc. 2015).

We will be marketing a food product, “Healthy Protein Snack Foods” that will be marketed to the athletic people, people playing soccer games, and people from ones who joined sports clubs in Dubai. The prime focus of the product is mainly on Dubai, that is u males between the ages of 20-35 years of age in order to get their attention to the efficacy of the product with to improving their health. From there we want to spread to other cities of UAE. The success of the “Healthy Protein Snack Foods” will be dependent on the way, we take the product to the people in our target market, describing its features and the aspects of health that it contributes, the replacement it can give for the fast foods, and the overall value it can add for the family health. we would like to marketing strategy that would enable us to reach the population of Dubai in a faster way, and in low cost method. The “Healthy Protein Snack Foods” is one of the kind of the products, created specifically for the sports people in Dubai, to help them upkeep their health.

Substitutes are plentiful available to take the place of a Glanbia product. A consumer upon entrance into most health shops would be greeted with tubs upon tubs of different whey proteins. The long list of substitutes erodes the demand for Glanbia products such as optimum nutrition. Brands such as Maxinuitrition, Muscle tech and cellucor are all household names when it comes to the performance supplement market. To combat this Glanbia have marketed there number one product Optimum Nutrition as a health supplement for all types of people and kept the BSN range more focused on the more advanced gym goers and body builders. The separation of the two brands has given Glanbia more power at either side of the market.