Harvard Business Case Study Crescent Pure

HOW SHOULD CRESCENT BE POSITIONED Put yourself in the position of Sarah Ryan as you are faced with the challenge of positioning a new product. In writing this up, stay focused on the following questions: · Given that Crescent is PDB’s first entry in the U.S. sports and/or energy beverage markets, what must PDB do in regard to Crescent’s pending launch? What factors should influence the positioning of Crescent? · How is the market segmented? At what segment should Crescent be targeted? · This section can be concisely executed in 1-2 pages APPENDIX Prepare an appendix with a perceptual map PDB must prepare ample research to help decipher the best positioning strategy in marketing Crescent. Some of the biggest factors influencing this are price, product quality, current market conditions of both the American energy drink market as well as the sports drink market, and then the opportune demographics within each market. In 2010-2012, the energy drink market in the US increased by 40% as compared to a 33% jump in the sugar-free sports drink market. The 2013 energy drink market in the US consisted of 5 major players who make up 85% of the market while the current sports drink market is dominated by 2 giant brands that together boast a 94% market share. With a near monopoly in place in this market, it can be safe to assume that it would prove extremely difficult to establish the Crescent-brand against such competition. In contrast, entering the energy drink market would allow Crescent to take advantage of the 15% of the market that is largely undeveloped and untapped by the 5 main competitors they would face. With no giant brands to compete with, it is a much more reasonable assumption for Crescent to not only do well but thrive for years to come. The vast majority of sports drinks are bottled. This has led to the near expectation that sports drinks always come in a bottle. In contrast, the majority of energy drinks are sold in cans. Given the can design of Crescent products, it would be difficult to establish itself in the sports drink market with this kind of image. The pricing would also be extremely difficult to pitch in the sports drink market that exhibits an average price of 1-2 dollars for bottles that are 12-24 ounces on average and is even more of a concern given how premium pricing experiments with Crescent have backfired. The $2.75 8 oz can will be received in a much more positive light in an energy drink market that averages $2.99 per 8 oz unit. . While both energy drinks and sports drinks are consumed largely by younger populations, sports drinks were indicated by 42% of consumers to be any time beverages. At an average of 1-2 dollars per unit, it is financially much more reasonable to assume this regular expense as compared to 8 ounces for $2.75. The opportune demographics for each segmentation strategy provide additional clarity. With negative PR surrounding the health concerns of energy drinks caused a falter in the market. On the flip side of this, there is a new demand for energy drinks that are more health conscious and transparent in their ingredients. This fits the Crescent product mold and would allow for an easy transition into the market. The focus group results reflect this as there was a 50% decrease in concerns regarding the health impacts of Crescent when informed that it contained the same amount of caffeine as a cup of coffee. This also spurred interest in some of the older participants that previously were more on the fence, saying they, “Liked that Crescent was a healthier alternative.” With a more generalized positioning strategy and a heightened focus on the organic qualities of the product, new market niches open up that only serve to expand opportunities for Crescent.