PDB acquired Crescent Pure, an organic juice drink containing caffeine, in July 2013. Crescent Pure aimed to position itself in the growing energy drink market by October 2013 through a soft launch in 3 states with $750,000 in advertising. Market research showed Crescent Pure was perceived as refreshing, healthy, and functional by consumers aged 18-24. Positioning it as an organic energy drink could reinforce these perceptions and help it break even with monthly sales of 12,000 cases by generating $760,320 in annual profit.
2. About the Company
• Portland Drake Beverages(PDB)- A
manufacturer of organic juices and sparkling
water
• Revenue: $120.5m by 2012
• Values: Quality Organic products at Affordable
Prices
3. The Players
Michael Booth- CEO
Sarah Ryan - Vice
President for Marketing
Matt Levor - Director of
Market Research
5. CRESCENT PURE
Peter Hooper founded Crescent Pure in Oregon in 2008
All natural organic juice containing herbal stimulants and
electrolytes
Retailed for $3.75 a can; Contained 80mg of caffeine(As in a
cup of coffee)
Sugar content was 70% lesser than sports and energy drinks
7. TO EXPAND AND MAXIMIZE REVENUE
SOFT LAUNCH IN JANUARY IN 3 STATES IN 2014
WITH AN ADVERTISING BUDGET OF 750,000, WANTED
TO DEFINE PRODUCT POSITIONING BY 1ST OCTOBER,
2013
8. PRODUCT POSITIONING
Energy
Drink
Sports
Drink
Organic
Drink
• Age Group:18-24
• Avg Price: $2.99/can
• Negative
Perception;
Rising Health Risks
• Age Group:12-24
• Avg Price: $1-$2/can
• Negative Perception;
Increasing Obesity,
High Sugar
• Age Group: All ages
• Avg Price: 25%
premium
• Healthier, Natural
Product
9.
10. MARKET OVERVIEW
• $ 8.5 BILLION MARKET GROWING 40% YOY
• TOP 4 BRANDS OCCUPIED 85% MARKET SHARE
• HIGHEST CONSUMERS WERE MEN OF 18-24 YEARS
• SALES OF ENERGY DRINKS WITH LOW CAFFEINE WERE RISING IN
DEMAND
16. 44%
36%
15%
3%
2%
18-24 25-34 35-44
45-54 55+
DEMOGRAPHICS OF
CRESECENT’S ONLINE
CONSUMERS
PERCEPTION OF
RESPONDENTS
REFRESHING 35%
HEALTHY 22%
AFFORDABLE 29%
FUNCTIONAL 47%
TOO SWEET 9%
SUTABLE FOR TEENS 8%
FUN 19%
NATURAL 38%
HYDRATING 29%
17. BREAK-EVEN ANALYSIS
AREA COSTS (IN $)
WHOLESALE PRICE PER CAN 1.24
COST PER CAN 1.02
PROFIT PER CAN 0.22
NUMBER OF CANS PER CASE 24
PROFIT PER CASE 5.28
PRODUCTION OF CASES PER MONTH 12,000
PROFIT PER MONTH 63,360
PROFIT PER YEAR 760,320
ADVERTISING COSTS 750,000
NET PROFIT 10,320
18. HOW SHOULD CRESCENT BE POSITIONED?
CONSUMERS VIEWED “ENERGY” AS CRESCENT’S MOST
DESCRIPTIVE CHARACTER
POSITIONING CRESCENT AS A “ORGANIC ENERGY DRINK” WOULD
REINFORCE EXISTING PERCETPTIONS
FIRST IS THE BEST
OPPORTUNITY TO ALSO BRANCH INTO SPORT DRINKS MARKET
WITH PRODUCT LINE EXTENSIONS