Product life cycle of energy drinks

New Product Launch Marketing Plan, Part III

Complete the final phase of your New Product Launch Marketing plan.

Please provide a total of 500 words. I have also attached the previous assignments that are associated with the information needed for the bulleted items.

Segmentation, target market, and positioning
Pricing and distribution strategies
Please follow APA formatting and include references.

Mufuliat Adeseun, Sontisha Allison, Johanna Curtis-Dancy, Shelia Collins, Latrina Saunders, and Emma Yearby

MKT/571

Heather Hanchak-Moss

March 10, 2014

New Product Launch Marketing Plan, Part II

Products are just like humans in that they have a life cycle. Products that have been established for a long time become less popular and the demand for new and modern products increase. Most companies understand the different stages of the product life cycle and that each has a limited lifespan. In order for PepsiCo to stand out in the market, it has decided to sell EDEN Energy in eco-friendly reusable sport bottles. Lower pricing of the product will also help to attract more consumers to purchase the product. Because of competition, PepsiCo will need to offer EDEN Energy at a lower price than the average in the market. The different ways to consume EDEN Energy will also help as consumers will be able to use the product however they choose, whether it is hot, cold, room temperature, or on ice.

Target Market

To ensure PepsiCo continues to follow proper path to achieve successful market target, they must employ various steps under target market profiles. Detailing a target market profile will help PepsiCo identify and determine the importance of communicating with reliable opportunities to have successful sales in the competitive market.

Before PepsiCo implements the new plan of action, it is necessary for PepsiCo to identify consumer’s buying behavior to appropriately align their product strategy. Without understanding consumer’s buying behavior, PepsiCo will be unable to draw consumer’s attention towards EDEN Energy (Muske, 2012). During the analysis, PepsiCo will review the type of quality and ingredients that the consumer prefers most in their current energy drinks. In addition, PepsiCo will place emphasis on qualities of EDEN Energy which will ultimately provide an option to the consumers to go for more of the product.

To continue to have consumer attention, it is imperative for PepsiCo to employ decision motivators that will motivate and direct the consumer’s interest towards EDEN Energy. The decision motivators that will be used are: the need to trust and belong; identifying excitement and fun, analysis of importance, the need to nurture, and adoption of self-improvement.

Product Life Cycle

As EDEN Energy moves through its life cycle, PepsiCo’s marketing approach will be adapted to fit each stage (Lorette, n.d). PepsiCo’s objectives in the introduction stage are to launch EDEN Energy and develop awareness amongst its target market. The initial offering will include the basic product and will be sold at a low price in order to quickly gain market share. The drink will first be launched domestically in the U.S. because of the ease of entry and will be distributed to sport teams and specialty retail stores (GNC and Trader Joes). Product promotion will be expensive and advertisement will focus on early adopter consumers such as athletics and will be created to build awareness, understanding, and acceptance of the energy drink (Lorette, n.d). Growing market share will be the main objective of PepsiCo in the growth stage. The company will ty to increase brand preference by focusing on EDEN Energy’s features and its benefits to users. As product demand grows, price and product quality will be maintained and distribution outlets will increase to include restaurants, grocery stores, online, and vending machines. To increase market shares and profits, EDEN Energy will be launched in Europe, Asia, South America, and Australia. Product promotion will be focused on building awareness and interest in the mass market (Lorette, n.d). In the maturity stage PepsiCo will focus on maximizing profits and defending its market shares. To effectively differentiate its products, PepsiCo will enhance the drink to include multiple flavors, bottle sizes, and improved benefit to consumers. EDEN Energy will be launched in Africa were there are less competitors. Product price will be matched or lowered to compete with competitors and promotion will emphasize brand differences, values, and benefits. As consumer taste changes and new trends appear, competition will become more aggressive and the sales and profits of EDEN Energy will fall drastically in the decline stage (Lorette, n.d). To maintain profits, EDEN Energy’s product and marketing costs will be reduced. Also, there will be intense prices cuts and non-selling flavors will be phased out. PepsiCo will continue to offer the remaining flavors to a loyal niche segment.

Product Mix: Features, Benefits and Branding

EDEN Energy has various ingredients such as caffeine, sugar, herbal extracts, and amino acid among other stimulants. While consuming this energy drink, users will realize the various benefits that it provide as far as human health is concerned. For instance, consuming EDEN Energy helps in provision of more energy in the body. Therefore, the energy drink is good for athletes and other users who are involved in carrying out heavy activities (Liotta et al, 2012). In relation to energy, this product is helpful to users because it increases heart rate. This product is important because it increases mental awareness of the users and provides nourishment through the minerals within the product.

Apart from providing nourishment, EDEN Energy also contains some amount of caffeine that helps in the stimulation of the body (Berger et al, 2011). The presence of caffeine is important to users especially when they feel drained. Therefore, for customers who may sometimes feel tired after performing some tasks are encouraged to take EDEN Energy for refreshment. Consequently, based on the above benefits of EDEN Energy, the company is certain that it will help many customers; hence, people should try using the product in order for them to know its benefits. In order for targeted customers to recognize the new product easily, the organization has decided to use a picture of an energetic man and woman carrying EDEN in their hands. These pictures explain the power of EDEN Energy drinks for its users.

Product Differentiating Characteristics

There are numerous energy drinks on the market and most have similar characteristics. Before its launch, PepsiCo conducted a product comparison in order to develop a differentiation technique for EDEN Energy. The idea is to make the product more visible to the consumer. Most energy drinks are sold to consumers in bottles (glass and plastic) or cans. PepsiCo has decided to take on the go green approach. EDEN Energy will be sold in eco-friendly reusable sports bottles. This can be viewed as a win-win for PepsiCo. Consumers will be able to refill the sports bottles with various liquids. The sports bottles will be clearly labeled with EDEN Energy drink. Free advertising will alert consumers about PepsiCo’s new energy drink. Consumers will have an opportunity to purchase EDEN Energy in one gallon containers which will be economically priced to attract families that are seeking ways to experience healthier living. One gallon size containers will save consumers time and money by reducing the need to travel to make extra purchases. This differentiation may be a short run because the competitor will have the same opportunity to increase the packaging of their energy drinks.

Pricing is another strategy. The average cost of energy drinks are $3.00 but the price of EDEN Energy will be $2.50. It seems like such a small amount of money. Consumers tend to purchase products that are considered to be a bargain. EDEN Energy will maintain the price for the first two years. Sales have been forecasted to increase PepsiCo’s market shares as the sales soar.

The quality of EDEN Energy will be impeccable. Most energy drinks are consumed at room temperature or with ice but EDEN Energy can also be consumed hot. EDEN Energy can be mixed in hot water in colder climates to produce more energy during winter months. The hot energy drink can be stored in the eco-friendly sports bottle which will benefit athletes during the winter.

New Positioning Statement

PepsiCo as a leading food and beverage company will aggressively promote healthy lifestyles. Consumers are requesting more healthy snacks and drinks to be offered on the market. PepsiCo is taking action to encourage healthier life styles and offer healthy nutrition options for consumers. Energy drinks, low calorie drinks, and low calorie snacks are a few of the products the company has introduced to promote eating and drinking healthy (Human Sustainability, 2013).

PepsiCo is a dynamic global business committed to sound and responsible growth. The business continues to grow and remain a popular brand among consumers (Human Sustainability, 2013). The new position statement would be “EDEN, superior taste, low calorie content, and long lasting energy”. Future marketing strategies will focus on the needs and wants from consumers around the world by concentrating on taste, nutrition and health.

Conclusion

It is important that manufacturers understand each stage of the product life cycle to make a profit and stay in business. The key to successful manufacturing is not only to understand the product life cycle, but also to manage products proactively throughout its lifetime. Product promotion will be used to build awareness for EDEN Energy to grow the market share. Focusing on the benefits to consumers, PepsiCo will try to increase the brand preference. As the life of EDEN Energy continues, and the consumer tastes changes, the price will be reduced to keep up to maintain products. The “EDEN, superior taste, low calorie content, and long lasting energy” campaign will help keep PepsiCo relevant in the market because of all the healthy benefits of the new energy drink.

References

Berger, L.K., Fendrich, M., Chen, H., Arria, A.M. & Cisler, R.A. (2011). Socio-demographic correlates of energy drink consumptions with and without alcohol: Results of community survey. Addictive Behavior, 36(2011), 516-519.

Human Sustainability. (2013) Retrieved from http://www.pepsico.com

Liotta, E., Gottardo, R., Seri, C., Rimondo, C., Miksik, I., Serpelloni, G. & Tagliaro, F. (2012). Rapid analysis of caffeine in “smart drugs” and “energy drinks” by micro-emulsion electro-kinetic chromatography (MEEKC).” Forensic Science International, 220(2012), 279-283

Lorette, K. (n.d). How Would the Marketing Mix Change at Different Stages of the Product Life Cycle? Retrieved from http://smallbusiness.chron.com/would-marketing-mix-change-different-stages-product-life-cycle-3283.html

Muske G. (2012): Understand Consumer Buying Behavior. Retrieved from http://smallbizsurvival.com/2013/03/understand-consumer-buying-behavior.html