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Media Campaign for my Advanced Advertising Media Class. Short description: As the innovator of the energy shot category, 5 Hour Energy was looking to expand its presence among current users and ...

Media Campaign for my Advanced Advertising Media Class. Short description: As the innovator of the energy shot category, 5 Hour Energy was looking to expand its presence among current users and individuals who drink coffee and energy drinks. To accomplish the goal a mix of traditional media was used to generate increased usage, brand loyalty and demand by targeting individuals who are moderate to heavy users of coffee and energy drinks. In addition to delivering 5 Hour Energy’s messages on a national basis, carefully selected DMA’s were used as a complement to drive sales and ensure a strong brand presence among consumers who are likely to use such a product.

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5 hr energy leave behind Presentation Transcript

  • 1. 5 Hour Energy
  • 2. Index Executive Summary…………………………………………………………………………………………………………………………………………………..………....3 Situation Analysis………………………………………………………………………………………………………………………………………………………………….4-13 History/Purpose of the Brand…………………………………………………………………………………………………………………………..………....4 Current Business Climate……………………………………………………………………………………………………………………………………………..5 Relevant Sales/Usage Data…………………………………………………………………………………………………………………………………………..6 BDI/CDI and Competitive Analysis………………………………………………………………………………………………………………………………..7-9 Geographic/Trade Market Characteristics…………………………………………………………………………………………………………………….10 Target Analysis……………………………………………………………………………………………………………………………………………….....…………11-12 Target Segment……………………………………………………………………………………………………………………………………………...…………….13 Marketing Objectives……………………………………………………………………………………………………………………………………………………………14 Creative Objectives…………………………………………………………………………………………………………………………………………………………….…15 The Media Plan…………………………………………………………………………………………………………………………………………………………………….16-17 Strategies…………………………………………………………………………………………………………………………………………………………………….16 Specifics on Chosen Media…………………………………………………………………………………………………………………………………………..17 Tactics…………………………………………………………………………………………………………………………………………………………………………………..18-20 Media Mix CostBreakdown……………………………………………………………………………………………………………………………………….…18 Budget Breakdown………………………………………………………………………………………………………………………………………….……………19 Flowchart……………………………………………………………………………………………..………………………………………………………………………20 Appendix………………………………………………………………………………………………………………………………………………………………………….……21-22 Added Value…………………………………………………………………………………………………………………………………………………….……………21 Sources………………………………………………………………………………………………………………………………………………………………….……..22 2
  • 3. Executive Summary As the innovator of the energy shot category, 5 Hour Energy is looking to expand its presence among current users and individuals who drink coffee and energy drinks. To accomplish this goal a mix of traditional media will be employed to generate increased usage, brand loyalty and demand by targeting individuals who are moderate to heavy users of coffee and energy drinks. In addition to delivering 5 Hour Energy’s messages on a national basis, carefully selected DMA’s will be used as a complement to drive sales and ensure a strong brand presence among consumers who are likely to use such a product. 3
  • 4. Situation Analysis History/Purpose of the Brand 5-Hour Energy is a flavored energy shot 5-Hour Energy has targeted a segment of made in the United States based in Farmington the market that other energy shot Hills, Michigan. It is sold in 2-oz containers. Its companies have not. It’s for work. It helps manufacturer, Living Essentials, focuses on the you feel better. It helps you get over that energy shot category rather than the energy afternoon slump.. drink category. The makers of the drink claim Executives at Living Essentials set out to that it will provide hours of energy and, unlike create a product that could compete in the other energy drinks, will not cause a sugar crash. tremendous energy-drink category. They After its introduction in 2004 it sparked a wave of wanted to create a small energy boost that "energy shot" drinks, and it is the number one was not 12 ounces. Also they knew it should selling product in the energy shot category in the have less sugar than others to avoid the US. The drink claims to be quick, simple, and crash and to promote a healthier choice. made to help hard working people. 5-Hour They planned to create a package that Energy is different than any other energy shot could sit and not get lost among the because of its target. 5-Hour Energy appeals to competitors. Last, they set out to target working adults instead of teenagers and young working adults, as opposed to the teenage adults. boys that are the cornerstone of almost every other competitor. 4
  • 5. Situation Analysis Current Business Climate Both Coca-Cola and PepsiCo have released Living Essentials has invested heavily in energy shots, as have Monster, Red Bull advertising over the past couple of years to and Arizona. The category is expected to secure a leading position for 5-Hour Energy. nearly double this year to $400 million While the competition is heating up its also wholesale, up from $210 million a year ago helping build the market for energy shots. according to Beverage Marketing Corp. Red Bull recently introduced a "shot" version Still, 5-HourEnergy, which launched in of its market-leading beverage. Dr Pepper 2004, is the undisputed leader in the field. It Snapple began test-marketing a shot of its controls roughly 70% of the market and is Venom energy drink (Venom Bite), and expected to top $320 million in sales this Coca-Cola has added a shot based on its year, which is almost double its sales of NOS energy drink. Shotz, which made its $170 million last year. The ever-present 2- vending industry debut at last falls National ounce red-capped bottles can be found in Automatic Merchandising Association retailers as diverse as Walmart, Home National Expo, is another contender in the Depot, Dicks Sporting fast-growing category. This year, Living Goods, OfficeMax, Kroger, Duane Reade Essentials plans to spend $60 million to and GNC. promote 5-Hour Energy. 5
  • 6. Situation Analysis Relevant Sales/Usage Date Theres still plenty of room for growth. 5- Hour Energy needs to prove and reassure to women that its safe, and useful. Convenience stores are on track to achieve such growth. According to Nielsen data they have posted the largest dollar sales increase in the first half of 2009 for "liquid vitamins, supplements and energy shots" – up 120.5% over the same period last year. 6
  • 7. Situation Analysis BDI/CDI and Competitive Analysis Cont. Breakdown of our Best DMA’s: Los Angeles This might possibly be the strongest Atlanta favors energy drinkers over coffee. 5 market for energy drinks with overall high hour energy has the second strongest brand indexes across the competition. Despite presence/usage, but also has several close such high usage, 5 hour energy still has competitors. considerable room to gain market share, indexing at 118. Chicago 5 hour energy has a steady index at 132. Although Arizona Extreme Energy Shot dominates with a 445 index this market is San Antonio Also one of the strongest markets still a great opportunity to increase brand for energy drinks. 5 hour energy indexes at usage with the right creative messaging. 82 though, which may be due to a lack of advertising dollars being spent in this Dallas 5 hour energy’s index is insignificant but overall high energy drink usage allows for market. advertising dollars to be allocated here. San Francisco This is another great market with Houston With 5 hour energy’s index at 263 being a lack of advertising dollars possibly being the second highest, a focus on brand loyalty is recommended. spent on 5 hour Energy. An insignificant index could be due to the geographic nature and demographics/psychographics of the people in this market. 7
  • 8. Situation Analysis BDI/CDI and Competitive Analysis Cont. Breakdown of Some Considerable DMA’s: Breakdown of the Worst DMA’s: Cleveland is by far the worst DMA. It did not Boston has moderate energy drink usage, with a index above average for any coffee/energy few competitors dominating the market. It drink category. Its highest index was 78 for may not be wise to spend much, if any “coffee drinkers,” and it’s not a viable market advertising dollars. to spend advertising dollars in. Miami 5 hour Energy indexes the highest at 205. Detroit’s highest index was 131 for Amp. A An emphasis on brand loyalty is key here majority of categories indexed far below since this market has moderate energy drink average, which is about the same weighting usage. as Washington DC. New York indexes low across the board except Philadelphia has several competitors cemented for a few competitors. However it is a big their presence, but 5 hour Energy still has enough market that could be an opportunity an index of 53, which could pose as a red to extend brand awareness and usage. flag when allocating advertising dollars. Washington DC’s highest index was 112 for Red Bull. Every other category was below average or insignificant which is about the same weighting as Detroit. 8
  • 9. Situation Analysis BDI/CDI and Competitive Analysis As shown in the previous table of the top 14 DMA’s Atlanta, Houston and Miami are 5 Hour Energy’s highest established markets. We are going to continue to advertise to reinforce brand loyalty in these markets, and ultimately steal share from competitors. Chicago and Los Angeles index high, but there is significant room for BDI growth, especially with all high indexes from competitors. Dallas, San Antonio, San Francisco and Philadelphia are lacking a strong brand presence, making them 5 Hour Energy’s biggest opportunity markets for a higher BDI. With substantial advertising dollars being allocated in these markets, increased usage is highly possible. 9
  • 10. Situation Analysis Geographic/Trade Market Characteristics Targeted DMA’s DMA 5 Hour Energy’s Index Market Type Atlanta 174 BDI Opportunity Chicago 132 BDI Opportunity Dallas 97 BDI Opportunity Houston 263 Well Established Los Angeles 118 BDI Opportunity Miami 205 Well Established Philadelphia 53 BDI Opportunity San Antonio 82 BDI Opportunity San Francisco 90 BDI Opportunity 10
  • 11. Situation Analysis Target Analysis Demographics/Psychographics: According to Simmons research among males and females between the ages of 22-39 who are employed full and part time, and full and part time students will be included in our target audience, because although they do not index the highest for 5 Hour Energy they are still prevalent users of energy drinks. The indexes show that consumers with these demographic characteristics equally divide their preferences between drinking coffee and energy drinks. 5 Hour Energy has an index in the middle among top competitors (Rockstar, AMP, Arizona Extreme Energy Shot, Full Throttle, Red Bull, and Sobe Adrenaline Rush). Homemakers and those that are unemployed will be excluded from 5 Hour Energy’s target audience, because they are the least likely users of the product. From these demographics we can conclude that those in our target audience that are full time and part time students are our biggest opportunities because their indexes were the 11 lowest.
  • 12. Situation Analysis Target Analysis Demographics/Psychographics: Supplemental information for • Adults 22-39 with a slight male skew demographics/Psychographics: • Finishing school, but most likely in the workforce Targets who are employed and have two or • Career and starting a family are most more kids are more likely to drink 5 Hour important to him/her Energy, because their daily activities would • Fairly active social life require an energy boost, as opposed to individuals who are employed and have no • Moderate exerciser kids. • Establishing a professional identity is likely *Race shouldn’t play a major factor in a priority targeting. The major DMA’s that we are • Convenience and efficiency play big roles advertising in we’re targeting the overall in his/her work and personal life lifestyle, not the individual lifestyle of the • Business trips may require more added people that live there. In these big energy than other target segments cities, the focus is on the workforce not • Likely to be adopters of new products once on race. they see others using them • Average salary of $45,000 12
  • 13. Situation Analysis Target Segment • Female usage- Ages 22-24 and 25-29 use • Target- By analyzing our data we choose to energy drinks the most. Ages 30-34 and 35- leave out 40-44 year olds from our target. 39 have low usage, but are still users of Even though 5-Hour Energy did not do well competitors products. The lowest users are with ages 35-39 we decided to target them ages 40-44 and will be excluded. anyway to steal share from other energy • Male usage- Although men drink energy drinks that favor well with 35-39 year olds. drinks more than women they still indexed relatively low for 5 Hour Energy compared to other energy drinks. Men ages 22-24 and 25-29 drink energy drinks the most. • 5-Hour Energy- Ages 25-29 and 30-34 drink 5-Hour Energy the most. The lowest users are 35-39 year olds. • All energy drinks- Ages 22-29 consume the most and widest range of energy drinks . Sobe, Rockstar, and Red Bull do well with ages 35-39. 13
  • 14. Marketing Objectives a. To capture new customers likely to c. To reinforce brand identity as the sole or recognize and actualize the benefits of authoritative source in the “Energy Shot” 5-hour Energy to increase trial and category. one-time users 12% in one year. b. To increase average purchases d. To increase demand and ultimately requests among current, light and moderate for retailers to stock 5-hour Energy at users by 1.5 bottles per month. mainstream retail locations target audience is likely to visit for other reasons (i.e. grocery, drug stores and big box. 14
  • 15. Creative Objectives Tagline: Hours of energy now, no 2:30 feeling later. We want the creative to fit in to how our target audience’s lifestyle is. For example: functional, smart, modern, young etc. 5 Hour Energy’s current advertisements are clear and straight to the point, and that’s a good place for them to stay. These advertisements show the target that this product is a convenient smart choice for energy during key times in their life when a shot of energy will make you more efficient to keep doing, working, exercising, or playing. 5-Hour Energy needs to focus on its health attributes. 5-Hour Energy has zero sugar, is non-carbonated and is low in calories. The message should communicate 5-Hour Energy’s health benefits to working professionals. They are always on the go, and need a quick energy fix, yet they are still health conscious. It’s an energy shot, not a drink. It keeps up with their hectic lifestyle and won’t give them a crash later. The vibrant packaging, although not the most attractive, stands out among its competitors, and is easily recognizable. 15
  • 16. The Media Plan Strategies The media classes we chose are OOH, Network Radio, Spot Radio, Network TV, Cable TV, and Spot TV. We chose this media mix because it is a broad way to reach our target audience through the media that they are most likely to use. Network TV and OOH are heavily weighted compared to radio and Network cable which is used as a supplement to reach our target audience and reinforce our message. Geographic Weighting Rationale: We will be weighting the schedule during fall and winter months. However, from our research we found that 5 Hour Energy is more popular in warmer states. By focusing on colder DMA’s it will allow the brand to grow. 16
  • 17. The Media Plan Specifics on Media Chosen OOH Busses, Taxis, Subways, Airports, Wallscapes, Small Billboards, Vinyl Graphics Network Radio Morning Drive, Evening Drive Network TV Early Morning, Prime Network Cable Late Fringe Spot TV Early Fringe/News, Prime Spot Radio Morning Drive, Evening Drive 17
  • 18. Tactics Media Mix Cost Breakdown Low Months – 42% of budget High Months – 58% of budget Spot – 42% of budget Net TV National – 58% of budget 24% Net Cable 38% 8% Net Radio More emphasis will be placed on Spot TV National advertising, because it provides 11% the greatest opportunity to reach new Spot Radio users and establish a brand presence. 11% 8% Outdoor 18
  • 19. Tactics 19
  • 20. Tactics 20
  • 21. Appendix Added Value 5-Hour Energy will be sponsoring many athletic events. If successful, sponsorship will capture new customers, increase average purchases among current users and reinforce brand identity. Sponsorships will help promote 5-Hour Energy’s image, use of the product, and benefits. Sponsoring athletic events establishes a relationship between the brand and an active lifestyle. Unlike traditional advertising, sponsoring does not deliver a direct message to consumers; instead sponsorship conveys an indirect message to consumers. Consumers will find the advertisement less intimidating, therefore feeling less pressure to try it. 21
  • 22. Appendix Sources http://www.5hourenergydirect.blogspot.com/ http://www.vendingtimes.com/ME2/dirmod.asp?nm=Vending+Features&type=Publishing&mod=Publications%3A %3AArticle&mid=8F3A7027421841978F18BE895F87F791&tier=4&id=F9AE131E4ED44232B844CFADA5F4043 0 Zmuda, Natalie. "5-HOUR ENERGY." Advertising Age 80.39 (2009): 22. Business Source Premier. EBSCO. Web. 24 Apr. 2011. 22