CASE STUDY OF HARVARD BUSINESS SCHOOL

1. HARVARD BUSINESS SCHOOL CASE

2. Crescent was a non-alcoholic functional beverage founded by
Peter Hooper, a native of Crescent in 2008.
In July 2013, PDB acquired Crescent.

3. A manufacturer of organic juices and sparkling waters.

4. Sarah Ryan
 vice president of marketing for PDB.
Michael Booth
 CEO of PDB.
Matt Levor
 PDB’s director of market research.

6. 1. PDB’s management team disagreed about viable
positioning strategies which would maximize
Crescent’s revenues.
1. Some felt the drink’s energizing ingredients supported
an energy-drink positioning.
2. while others support for sports-drink due to the
drink’s hydrating elements, a sports-drink positioning
made more sense.

7.  While Sarah Ryan is thinking that a third positioning
option focusing on the drink’s healthy and organic
roots may attract the most consumers.

8.  PDB wants to beat some of the country’s largest
national beverage companies planning to launch all-
natural versions of their own sports and energy drinks
in the second half of 2015.
 Production capacity constraints prevent PDB from
launching the drink nationally until early 2015.
 So, PDB planning to embark on a “soft launch” of
Crescent in three western states (California, Oregon,
and Washington) in January 2014.

10. Evaluate the survey report provided by Matt Levor.
Analyze the data and focus on demographic, psychographic
behavior corresponding to energy and sports drink.

11. Evaluate the feedback provided by the consumer of Crescent
according to Demographics.
Evaluate the difference found between other drinks and
Crescent drink in both category energy drink and sports-
drink.

12. Industry specifics related to positioning options for energy
drink or sports-drink or any third category.
Final decision to launch the Crescent product in specific
category.

14. Evaluate the surveys for energy drinks and sports drink for
other running company and Crescent past and current
feedback, then what will be the projected scenario of market
?

15. Premium pricing or affordable pricing ? Where does the
Crescent stand in both category?

16. COMPANY NAME MARKET SHARE
FRIGHT 34%
RAZOR 27%
TORQUE 16%
STELLER 8%
OTHERS 15%
 Consumers are mostly men of age group 18-34 years old.
 the market for energy drinks had grown by 40%. Projected
figure to reach $13.5 billion by 2018
 The highest volume of energy drinks consumed was by
respondents with a household income below $25,000 per
year.

17. COMPANY NAME MARKET SHARES
GLEAM 73%
DRIP 21%
OTHERS 6%
MEN WOMEN
CONSUMER WHO
DRINK
50% 33%
REFRESHING 40% 27%
AGE 18-24 YEARS 62%
12-17 YEARS 77%

18. Age range
18-24 44%
25-34 36%
35-44 15%
45-54 3%
55+ 2%
MALE 59%
FEMALE 41%
COLLAGE DEGREE 62%
HOUSEHOLD INCOME (MEDIAN) $42,500

19.  Most consumer of Crescent were below the age 44 and
if we notice huge consumers belongs below 35 and
above 18 and also Male counts for 59%.
 And we have noticed earlier that Energy drink
Consumers are mostly men of age group 18-34 years old.
Whereas the consumers of sports drink are mostly below
24 years old.

20. Energy drinks Sports drink
Refreshing 12% 34%
Healthy 6% 16%
Affordable 5% 11%
Functional 22% 28%
Too sweet 9% 8%
Suitable for teens 7% 22%
Fun 9% 11%
Natural 4% 6%
Hydrating 11% 49%
None of these 52% 27%

21. Descriptor
Refreshing 35%
Healthy 22%
Affordable 29%
Functional 47%
Too sweet 9%
Suitable for teens 8%
Fun 19%
Natural 38%
Hydrating 29%

22. Energy drinks Sports drink Crescent
Refreshing 12% 34% 35%
Healthy 6% 16% 22%
Affordable 5% 11% 29%
Functional 22% 28% 47%
Too sweet 9% 8% 9%
Suitable for teens 7% 22% 8%
Fun 9% 11% 19%
Natural 4% 6% 38%
Hydrating 11% 49% 29%
None of these 52% 27% ----

23.  Crescent feedback is more better then other brand
Energy drink in each area which will give a edge
position to this product if it will be released as Energy
drink.
 If we compare with sports drink then Crescent is more
functional and natural then other brand sports drink
but it will lack in the attention of hydrating. So, it will
be approximately same or slightly more or less product
if it will be released as sports drink.

24. ENERGY DRINK SPORTS DRINK CRESCENT
$ 2.99 PER(8 oz.) $ 1.00 PER (12 oz.) $ 3.00 PER (8 oz.)
 While PDB wants to sell Crescent at $ 2.75 PER (8 oz.). Which will
create more demand and provide an edge position.

25.  While we may notice that the variable cost for
Crescent is $ 1.02 per can, which will be higher then
the wholesale price of Sports drink. So if PDB wants to
sell it as Sports drink then it must have to keep it’s
price higher then the other brand product.
 But if we shape the crescent product as energy drink
then it will be cheaper then the other brand energy
drink which will give a strong position to crescent and
it will differentiate the product from other brands.

26. ENERGY DRINK SPORTS DRINK CRESCENT
News stories highlighting
the drinks’ alleged health
risks, consumers are
trying to reduce the
consumption.
Concern regarding rising
childhood obesity rates
resulted in government-
mandated guidelines to
remove high-calorie
sugary drinks and snacks,
including sports drinks,
from school vending
machines beginning in
2014.
Crescent’s herbal
stimulants (guarana seed
and ginseng) delivered 80
milligrams of caffeine,
And this could be a
barrier in future time for
Sports Drink.

27. ENERGY DRINK SPORTS DRINK CRESCENT
Sales of energy drinks
with lower levels of
caffeine and purer
ingredients were rising
due to consumer demand
for healthier food and
beverage choices.
New diet and low-sugar
sports drinks were growth
areas for the industry. The
market size for diet and
low-sugar sports drinks
was expected to increase
from $1.4 billion in 2012 to
$2.97 billion in 2017
lime green and orange
accents, clear-colored
liquid. Taste included a
hint of fruit and was less
sweet than most fruit
juice, cola, sports drinks,
and energy drinks. Each
can contained one 80-
calorie serving.

28.  CRESCENT as Energy drink : Apart from health risk
rumor about Energy drink on the basic of other
company brand, the market for energy drinks had
grown by 40%. . It was estimated to be $8.5 billion in
the United States in 2013 and forecasts projected that
figure to reach $13.5 billion by 2018. On the basic of
this figure we can say that market size of energy drink
is much larger then sports drink.

29.  CRESCENT as Sports drink: If it will enter in market as
Sports drink then due to premium price it will lack the
competition and due to caffeine content it may face
hurdle in future.
 CRESCENT as drink’s healthy and organic roots: This
tagline may works better then sports drink but again
the price would be premium and PDB has already
suffered once because of premium pricing. And there
is another chance of legal challenges due to caffeine
content.

30. Energy and hydration.
Nutrition and taste.

33. The difference from Energy drink can be noticed easier. So,
Crescent as Energy drink will be more valuable product to
launch.

34. Retailers indicated that their inventory of Crescent depleted
quickly, some had increased the price by 25%, and still sold
out before inventory was replenished.
Crescent appeared to be most popular among consumers
aged 18 to 30
Higher percentage of women purchased Crescent than they
expected

35. Better taste
More satisfaction with energy content
Total consumer satisfaction
Price is surprisingly affordable

36. We have studied the different views and corresponding result
and almost in each case we noticed that Crescent as Energy
drink is the best option to go in market.

37. Crescent will be launched as Energy Drink

38. ANAND KUMAR
IIT KHARAGPUR
UNDER THE GUIDENCE OF PROF. SAMEER MATHUR