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Marketing Plan: AMP Energy

PepsiCo launched Amp Energy in 2001 to compete in the growing energy drink market but sales have declined, dropping Amp to 5th place behind Red Bull, Monster, Rockstar, and NOS. To revitalize the brand, PepsiCo eliminated all 15 flavors of Amp and reinvented it with 3 new flavors and formulations. This marketing plan outlines Amp's target markets, competitive analysis of top energy drinks, and new media strategy to reposition Amp and boost sales among its core consumers of families and young professionals.

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DEVELOPING A MARKETING PLAN FALL 2013 COLUMBIA COLLEGE CHICAGO AMP ENERGY Zanah Thirus Zanahthirus@gmail.com 11/10/13
EXECUTIVE SUMMARY Amp Energy was launched by PepsiCo in 2001. AMP Energy is the premier energy brand of Purchase, N.Y.-based Pepsi-Cola North America Beverages (PCNAB). With its energizing blend of B-vitamins and a specially formulated intense combination of taurine, ginseng, and guarana, AMP Energy provides the power needed to tackle everything in life, day or night. PCNAB is a division of PepsiCo, which offers the world's largest portfolio of billion-dollar food and beverage brands. Over the past several years, Amp Energy has seen a dramatic financial decline. In 2008, Amp was the 4th most bought energy drink (behind Red Bull, Monster, and Rock Star). Since then, PepsiCo’s CSD dollar sales have declined 1.4%. Amp Energy has moved to being the 5th most popular energy drink, below NOS and its leading competitors. Recently, the Amp Energy team decided to rebrand Amp. Eliminating all 15 flavors and reinventing 3. The following marketing plan contains a market summary, competitive overview, demographic summary, a financial analysis, and a media plan for the newly revamped brand strategy. The purpose of the marketing plan is to restructure Amp’s current marketing strategy to target its current primary consumer base (families and young professionals). Demographic charts and competitive overview charts are from Spectra and MRI.
TABLE OF CONTENTS Table of Contents p.1 Company Overview p.2 Market Summary p. 4 Competitive Analysis - AMP - Red Bull - Monster - Rock Star p.7 p.7 p.9 p.11 p.13 Competitive Analysis Summary p. 15 Channel Summary p.16 GAP Analysis p.18 SWOT Analysis p.20 Cultural Issues p. 22 Market Strategy & Programs - Marketing objectives - Financial Objectives - Target markets & Target Audiences - Positioning Strategy - Marketing Budget and Calendar p.23-34 Bibliography p.35
History of Amp: A PepsiCo Brand Amp Energy is the energy drink version of Mountain Dew, created by PepsiCo, and released in 2001. AMP Energy is the premier energy brand of Purchase, N.Y.-based Pepsi-Cola North America Beverages (PCNAB). With its energizing blend of B-vitamins and a specially formulated intense combination of taurine, ginseng, and guarana, AMP Energy provides the power needed to tackle everything in life, day or night. PCNAB is a division of PepsiCo, which offers the world's largest portfolio of billion-dollar food and beverage brands Amp Energy was launched by PepsiCo in 2001. PepsiCo is one of the world’s leading food and beverage companies with over 65 billion in net revenue in 2012. Pepsi Co has a global portfolio of diverse and beloved brands including Pepsi, Gatorade, Lays, Amp, and Quaker. Pepsi Co employs over 250,000 employees in 200 countries across the globe, and the reported revenue growth in the beverage division was 4.5% in 2012. According to Pepsi Co’s website, 80% of the current executive team was promoted from within. The company headquarters is located in Purchase, NY. The current CEO is Indra Nooyi. Pepsi Co Brands are organized into the four global business units: Pepsi Co American Foods Pepsi Co American Beverages (Including Amp) Pepsi Co Europe Pepsi Co Asia, Middle East, and Africa (AMEA) According to Pepsi Co’s 2012 annual report, the company objectives include: Building and retaining top talent
To focus on driving cost savings and other productivity enhancements derived from our complimentary food and beverage portfolio. Reinforce our existing value drivers (refocusing efforts on most popular global brands). PepsiCo’s original strategy for Amp was to position it to compete with leading energy drink brands like Red Bull and Monster. PepsiCo repositions AMP: In 2008, AMP was America’s 4th most popular Energy drink (behind Red Bull and Monster). That year, PepsiCo decided to “amp up” Amp’s media budget and positioning strategy. PepsiCo launched a massive campaign starring Nascar driver dale Earnheardt Jr., three new flavors, a high profile summer promotion, and a slew of packaging variations. This was all in an attempt to increase Amp’s presence in the Energy Drink market, and to compete with the leading brands, Red Bull and Monster. Since the major campaign in 2008, Sales for Amp have taken a major drop. In the last year, PepsiCo’s CSD dollar sales have declined 1.4% amounting to “The Worst performance of PepsiCo in over a year”, according to Wells Fargo’s senior analyst, Bonnie Herzog. Amp is now sitting below Rockstar, NOS, and Starbucks Double Shot. Those three brands are sitting below Red Bull, and Monster. Something had to be done. This year, PepsiCo decided to rebrand and reposition Amp Energy. PepsiCo eliminated all 15 of Amps categories and created a product line of 3 with all new formulations and designs. “Our New line of innovative products provides a kick of energy to match anything the day brings. So tell your Monday morning to bring it on, your Friday night to wait up for you, and everything else in between to be ready. You’re on your way”- Amp Energy Team
I. MARKET SUMMARY According to www.energyfiend.com, Energy Drinks are a billion dollar industry. Red Bull sold US$3.4 billion dollars of energy drink product in the 52 weeks prior to July 2013. Monster sold US$3.1 billion worth. A huge part of energy drink popularity is in the sponsorship efforts, with top brands spending large sums of money to achieve brand placement. Several energy drinks have definitely been lifting their marketing efforts and it’s paying off with their recent entrance into the top 15 energy drinks ranking. The leading energy drinks are Red Bull and Monster. Red Bull sold US$3.4 BILLION dollars of energy drink product in the 52 weeks prior to July 2013. Monster sold US$3.1 BILLION worth. The third leading energy drink is Rock Star. NOS is in fourth place, and AMP Energy is in 5th place. The energy drink market continues to grow even in light of the tough economy and increased health scrutiny. Soda sales have been declining steadily over the same period, while energy drink sales have been booming. Despite recent FDA scrutiny regarding the safety of these beverages, 2013 energy drink sales are up 6.7% over last year in the USA alone. FIG. 1
CARBONATED BEVERAGE (INCLUDING ENERGY DRINKS) DEMOGRAPHIC SUMMARY – 2013 Spectra Reports The following four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest carbonated beverage consumers. Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 77 76 112 91 113 128 100 114 93 123 131 138 149 125 176 94 150 156 136 195 152 157 110 145 152 184 211 155 47 64 88 94 78 110 79 48 40 52 71 69 81 62 29 33 36 39 40 46 39 105 96 129 138 135 176 132 97 89 98 121 123 120 107 78 65 73 101 86 85 80 84 79 99 106 103 123 100 Very High: 150+ High: 120-150 FIG. 2 Demographic Skews Male Head Only with Children 5+ Person Households Oldest Child 12 - 17 Not a High School Graduate Presence of Only Children 6 - 17 Farming, Fishing & Forestry Occupations Female Head Only with Children Precision Production, Craft & Repair Occupations Struggling Rural Mix Presence of Both Children Under 6 and 6 - 17 Total Consumption 4% 18% 25% 20% 27% 1% 11% 15% 4% 9% Index 178 165 158 151 146 145 144 141 140 138 FIG. 3
Race of Head of Household-Total Consumption Index 150 100 50 0 White Black Hispanic Asian Other FIG 4 Source: Homescan Product Library 2013 Sep (Spectra) Household Income-Total Consumption Index 150 100 50 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More Source: Homescan Product Library 2013 Sep (Spectra) FIG 5
II. Competitive AnalysisAMP/ RED BULL/ MONSTER/ ROCKSTAR A. AMP ENERGY The following four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest AMP ENERGY consumers . Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. FIG 6 LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 95 46 210 137 187 294 163 350 62 153 118 95 229 159 179 72 124 197 161 370 195 168 173 143 57 139 200 152 148 110 144 147 104 69 123 44 61 18 71 32 57 47 17 36 10 29 7 15 17 361 36 242 96 66 88 145 61 50 60 86 46 36 53 39 12 15 46 84 16 32 138 68 104 100 83 113 100 Very High: 150+ High: 120-150
Total Consumption Demographic Skews Transportation & Material Moving Occupations Age 18 - 24 5+ Person Households Presence of Only Children 6 - 17 Oldest Child 12 - 17 Multi-Person Households without Children Age 35 - 44 Farming, Fishing & Forestry Occupations Age 25 - 34 Married Families with Children 13% 12% 22% 35% 29% 26% 32% 1% 25% 34% Source: Homescan Product Library 2013 Sep (Spectra) 150 100 50 0 Black Hispanic Asian Other Source: Homescan Product Library 2013 Sep (Spectra) FIG 8 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More Source: Homescan Product Library 2013 Sep (Spectra) FIG 9 349 285 196 186 184 181 180 177 169 167 FIG 7 Race of Head of Household-Total Consumption Index White Index
B. RED BULL The following four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest RED BULL consumers. Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. FIG 10 Demographic Skews Presence of Both Children Under 6 and 6 - 17 Male Head Only with Children Other Races Precision Production, Craft & Repair Occupations Age 25 - 34 Transportation & Material Moving Occupations 5+ Person Households Oldest Child 6 - 11 Hispanics Oldest Child Under 6 Total Consumption 18% 6% 5% 23% 32% 8% 23% 18% 24% 14% Index 269 259 231 215 212 205 203 195 192 192 FIG 11
Race of Head of Household-Total Consumption Index 250 200 150 100 50 0 White Black Hispanic Asian Other Source: Homescan Product Library 2013 Sep (Spectra) FIG 12 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More Source: Homescan Product Library 2013 Sep (Spectra) FIG 13
C. MONSTER The following four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest Monster Energy Drink consumers . Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 269 174 99 153 125 122 154 140 107 166 141 339 115 169 242 150 108 107 243 195 173 216 126 125 103 122 117 132 107 159 88 74 140 58 104 105 23 50 73 47 33 55 4 35 19 28 28 11 20 226 277 99 86 163 85 154 86 86 101 44 93 51 79 30 42 21 51 33 33 33 132 115 84 84 119 72 100 FIG 14
Total Consumption Demographic Skews Male Head Only with Children Female Head Only with Children Transportation & Material Moving Occupations Oldest Child 12 - 17 Striving Small City Living Presence of Only Children 6 - 17 Presence of Only Children Under 6 Oldest Child Under 6 Administrative Support Occupations 4 Person Households 4% 14% 7% 27% 6% 32% 13% 13% 11% 22% Index 198 195 186 172 171 170 169 167 166 165 FIG 15 Race of Head of Household-Total Consumption Index 200 150 100 50 0 White Black Hispanic Asian Other FIG 16 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More FIG 17
D. ROCK STAR The following four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest Rock Star Energy Drink consumers. Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 131 242 158 349 109 139 185 132 164 95 155 82 82 116 273 688 316 203 120 103 267 65 124 129 63 166 153 121 42 48 78 61 78 64 61 30 26 53 39 264 31 83 12 13 68 13 67 18 34 49 118 135 152 80 134 112 107 25 36 98 84 111 72 52 21 69 111 19 35 45 72 124 103 112 109 80 100 Very High: 150+ High: 120-150 FIG 18
Total Consumption Demographic Skews Male Head Only with Children Female Head Only with Children Transportation & Material Moving Occupations Oldest Child 12 - 17 Striving Small City Living Presence of Only Children 6 - 17 Presence of Only Children Under 6 Oldest Child Under 6 Administrative Support Occupations 4 Person Households 4% 14% 7% 27% 6% 32% 13% 13% 11% 22% Index 198 195 186 172 171 170 169 167 166 165 FIG 19 Race of Head of Household-Total Consumption Index 200 150 100 50 0 White Black Hispanic Asian Other FIG 20 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More FIG 21
COMPETITIVE ANALYSIS/ DEMOGRAPHICS SUMMARY BASED ON 2013 SPECTRA CONSUMER REPORTS Across the board, Amp Energy and its main competitors have similar heavy consumers.: **FIG. 2, 6, 10, 14, and 18** Start up families Younger bustling families Older bustling Families Rock Star was the ONLY competitor with a high index number among the Independent Singles category. **FIG 18** The majority of consumers are Families or couples ** FIG 3,7,11,15 and 19** All consumers with high index numbers had children (most times, more than one child) ** FIG 6,10,14,and 18 ** The Head of Household occupations with the highest index numbers are **FIG 7, 11, 15, and 19** o o Careers in Precision, production, craft & repair Transportation and material moving The majority of consumers with the highest index numbers **FIG 7,11,15, and 19* o Owned more than one vehicle o Were not married, but had children o Lived in a 3-5 person household o Were single parents Household income among heavy consumers ranged from o $10,000-$70,000 FIG **5,9,13,17 and 21** Majority of consumers purchased energy drinks from grocery stores (based on channel summary) ** FIG 22-25 Majority of consumers are Hispanic or Mixed races.
III. Channel Summary AMP FIG 22 Channel Summary Grocery Mass Merchandise All Other Drug Total Volume per 100 HHs % Volume 59% 19% 17% 5% 7.21 2.27 2.04 0.64 RED BULL FIG 23 Channel Summary Grocery All Other Mass Merchandise Drug Source: Homescan Product Library 2013 Sep (Spectra) % Volume 41% 34% 17% 7% Total Volume per 100 HHs 17.15 14.23 6.94 3.02
MONSTER FIG 24 Channel Summary % Volume Grocery Club Mass Merchandise All Other Convenience Drug Total Volume per 100 HHs 40% 33% 14% 6% 5% 2% 29.46 24.14 9.88 4.74 3.60 1.31 ROCK STAR FIG 25 Channel Summary All Other Grocery Source: Homescan Product Library 2013 Sep (Spectra) % Volume 53% 47% Total Volume per 100 HHs 7.77 6.82
IV. GAP ANALYSIS – Products and Services AREAS OF CONCERN HIGHLIGHTED IN RED AMP RED BULL Products Products 7 products 3 categories: BOOST, ACTIVE, & FOCUS SPORTS: Sponsors 6 athletes including Dale EarnHardt Jr. Company: Majority of Amp Energy promotions are through social media: Face book & Twitter Product Divisions: Sugar Free, Total Zero, and Editions (Blue, Red, and Silver). COMPANY Red Bull TV Sponsors over 100 athletes in biking, surfing, snowboarding, and motorsports. Red Bull Music Academy 100% recyclable products Wings team/ Student Brand Managers Red Bull Graduate School SPORTS DIVISIONS Red Bull Racing Red Bull Crashed Ice Red Bull X Fighters Red Bull BC OWE MONSTER ROCKSTAR PRODUCTS: 34 different products 6 different categories (Monster Energy, Java monster, DuB, Rehab, Extra Strength, Muscle Monster). PRODUCTS SPORTS DIVISIONS Sponsors athletes in 21 motor sports Sponsors athletes in 9 action sports Roster of over 30 athletes COMPANY Monster Girls Monster TV Sponsors bands and tours : MONSTER OUTBREAK TOUR OVER 20 different flavors SPORTS DIVISIONS Sponsors athletes in 11 action sports (BMX, skating, Skiing, snowboarding.) Sponsors athletes in 5 different motorsport divisions COMPANY Represents models Represents music artists PRODUCTS AVAILABLE ONLINE
V. PEST ANALYSIS Political Factor: Regulation about content of energy drinks from US Food and Drug Administration (FDA) Economic Factor: According to Spectra Product Reports , the vast majority of energy drink consumers are in families of 3-5 and may be price sensitive when shopping for beverages. Social Factor: Consumers are now becoming more health conscious, and may lean toward healthier choices such as: o Vitamin water o Coffee o Low calorie energy shots o Energy bars o Protein shakes Online Shopping is becoming very popular. Majority of energy drinks do not offer their products online/via their website. Technological Factor: Social Media Era: o In order to keep up with the competition, the majority of products have to have social media pages to promote their product.  Facebook  Twitter  Instagram  Pintrest  Tumblr o Online Shopping is becoming very common among grocery store shoppers
VI. SWOT ANALYSIS STRENGTHS: A. AMP is a division of a well known company, PepSiCo. . B. The Law of Contraction: “A Brand Becomes Stronger When You Narrow Its Focus.” Amp has eliminated all 15 products and created a small line of 3 products with 7 flavors. C. Amp’s new target consumer is the consumer with a practical need for energy. This matches the primary energy drink consumer: Families Those with transportation & moving careers. Single parents Early risers & Late nighters WEAKNESS: Competitive Situation Amp’s competitors (Red Bull, Monster, and Rock Star) offer WAY more than Amp does. Amp has to now focus on rebuilding its fan base in order to compete with well known competitors. Each competitor:  Has a TV station to promote its athletes and events Uses models to represent the brand: Wings Team Girls (Red Bull), Monster Girls, Rock Star Models. Sponsors at least 20 athletes. Represents music artists or sponsors tours
OPPORTUNITIES: Amp has the opportunity to build its brand presence through the media. Since Amp’s target and brand is different than the majority of energy drinks, they have an opportunity to gain market leadership among other beverage categories. Very few energy drink and/or beverage companies sell their products online. This can be a new opportunity for AMP. THREATS: Revamping the brand turns indirect competition into direct competition. Amp is now all about a consuming energy drinks for practical reasons. A healthier choice for a healthier lifestyle. This means Amp is now competing with:     Vitamin Water Low calorie energy shots Protein shakes Energy bars
VII. CRITICAL ISSUES “Things changed. We're not just playing hard, we're working hard, too. So we need energy for different reasons: To get a hop in our step, fuel our passions, or to get in the "zone". That's why AMP Energy is rethinking energy. Our full lineup of innovative products provides a kick of energy to match anything the day brings. So tell Monday Morning to bring it on, Friday Night to wait up for you, and everything in-between to be ready. You're on your way.” – The AMP Energy Team Amp Energy has completely revamped its brand. Although this decision has its advantages, it may put Amp on thinner ice. Amp is now competing with two different sets of competitors since they revamped their brand: Energy Drinks: Red Bull, Monster, Rock Star, etc Healthy Energy Choices : Vitamin water, protein shakes, etc Amp’s brand does not offer as many elements as its competitors. Amp sponsors less than half of the athletes that its leading competitors sponsor. Red Bull, Monster, and Rock Star all have brand models (Monster Girls, Wings Team Girls, and Rock Star Models), Amp does not. Amp Energy eliminated 15 products and moved to a line of 3 functional drinks. They eliminated several consumer favorites, which means they will have to go the extra mile to regain consumers that they lost.
VIII. Marketing Strategy and Programs A. The Central Idea  AMP Energy has completely revamped its brand. Consumers and the energy drink market should be fully aware of PepsiCo’s efforts to reposition AMP. This new positioning strategy needs to be enforced through social media, and all advertising mediums. B. Mission “ Things changed. We're not just playing hard, we're working hard, too. So we need energy for different reasons: To get a hop in our step, fuel our passions, or to get in the "zone". That's why AMP Energy is rethinking energy.” – The AMP ENERGY TEAM C. Positioning Strategy “Be smart about managing your energy. Introducing the new line-up of AMP Energy drinks to help fuel life, career, family, and everything else that matters to you. So saddle up partner. Let's get it done.” – AMP Energy AMP’s new full lineup of innovative products provides a kick of energy to match anything the day brings. Unlike its competitors, AMP focuses on the smart way to manage your energy, and provides unique products that cater to the everyday needs of its consumers. The new positioning strategy focuses on two target markets : Families & Young Professionals. . According to spectra demographic reports, families represent 54% of AMP’s total volume segment. Target Audience #1 o o o o o o o Age 25-44 Parents Grocery Store Shoppers Career parents & stay at home parents Early Risers and Late Nighters Single and/or married Health conscious shoppers
o Households with 3-5+ persons Target Audience #2 o o o o o Age 18-24 Early Risers & Late Nighters Athletes College Students Recent Graduates Total Consumption Demographic Skews Transportation & Material Moving Occupations Age 18 - 24 5+ Person Households Presence of Only Children 6 - 17 Oldest Child 12 - 17 Multi-Person Households without Children Age 35 - 44 Farming, Fishing & Forestry Occupations Age 25 - 34 Married Families with Children Index 13% 12% 22% 35% 29% 26% 32% 1% 25% 34% 349 285 196 186 184 181 180 177 169 167 Source: Homescan Product Library 2013 Sep (Spectra) LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 1.0% 0.7% 2.5% 1.4% 2.6% 4.0% 12.2% 3.2% 0.9% 2.1% 1.2% 1.3% 3.6% 12.4% 1.3% 0.8% 1.5% 2.2% 2.1% 5.8% 13.6% 2.2% 4.6% 2.7% 0.7% 2.2% 3.4% 15.9% 3.4% 1.2% 1.5% 3.3% 2.4% 1.0% 12.8% 0.9% 1.0% 0.3% 1.4% 0.8% 1.4% 5.8% 0.2% 0.5% 0.2% 0.3% 0.2% 0.4% 1.7% 5.7% 0.7% 4.9% 1.2% 1.2% 2.0% 15.7% 0.8% 1.1% 1.4% 0.8% 0.8% 0.9% 5.9% 0.6% 0.3% 0.4% 0.5% 1.8% 0.5% 4.0% 19.3% 11.7% 17.5% 13.0% 15.5% 23.0% 100.0%
Target Market Demographic Information - Which locations are we focusing our marketing efforts? Local Market Behaviors- What are common shopping behaviors of our target market within these locations? LOCATION For this Marketing Plan, we will market towards Amp Energy’s consumers with the highest total volume sales, Families & Young professionals. Families & Young professionals make up 54% of Amp’s total sales. We will target these groups within 5 Midwestern metropolitan areas. Chicago (CHI) Cleveland (CVL) Detroit (DET) ( Grand Rapids/Kalamazoo/Battle Creek (GPD) Minneapolis/St Paul (MSM) Families and Young Professionals within these locations are the exact market that AMP Energy is targeting. The early risers, the late nighters, those with a busy schedule and a practical use for every day energy. LOCAL MARKET BEHAVIORS According to 2013 Spectra Reports, Local Market Behaviors for Chicago, Cleveland, Detroit, Grand Rapids, and Minneapolis include high indexes & sales volume in: (CHI) - Spending $100-$499 on children’s clothing within 12 months Buying cosmetics, perfume and hair products Eating at fast food restaurants frequently Own a used vehicle (CVL) - Are Saturday & Sunday newspaper readers Watch morning news repeatedly Household owns Ipod, MP3, Digital Recorder or Gaming system Own smart phones
(DET) - Shop at Hardware stores frequently Shop at Mass Merchandise stores frequently Social Media users (Facebook, Twitter, Instagram) Household owns video game system (GPD) - Health conscious eaters Eco Friendly activities done on a regular basis Online Shoppers Typically watch late night programs
D. Financial Objectives AMP Energy’s sales dropped from 300 million to 239 million in 2013. AMP Energy went from being the 4th most popular energy drink, to the 5th most popular. Our sales goal is to increase sales by 5% in each quarter of 2014. Our profitability goal is to increase profits by 5%. Sales Goals 2014 Q1 - $250,950,000 Q2- $263,497,500 Q3-$276,672,375 Q4- $290,505,993 E. Marketing Objectives OBJECTIVE #1: Increase Market Awareness by 18% in 12 months STRATEGY: MEDIA AWARENESS: o Rapid Penetration- low price/high promotion o AMP Energy could benefit from a national advertising campaign titled “Rethinking Energy”. Consumers and the energy drink market should be fully aware of PepsiCo’s decision to rebrand AMP. AMP’s new positioning strategy is clear through their website, but nowhere else. Not many consumers are aware of AMP’s new lineup of drinks, or their new strategy. The new AMP needs to be advertised via television, radio, and magazine. - PROGRAMS : Media Mix  TV: Early News ($7,700 CPP) Late Fringe ($20,000 CPP) Primetime ($25,300 CPP)  Radio Network Radio ($8,500 CPP)  Outdoor Ads Downtown Coverage/Parking lot displays -$60,000 x 30% increase due to National campaign.
 - Wrapped Train -$30,589 x 30% increase due to national campaign Taxi tops - $120,000 x 30% increase due to national campaign Internet ads Banner ads Social Media Websites Youtube Budget Plan  $10,000,000 National Campaign  35% on TV – $3,500,000 Early Morning News (parents, professionals, and college students tend to be awake and getting ready, needing energy.) Late Fridge (Settling down to watch tv, late night “studyers”, procrastinators)  30% on Outdoor advertising $3,000,000 Outdoors in common city areas Downtown on taxis and in parking lots On public transportation  20% on Radio $2,000,000 Pandora Radio Early morning radio  15% on internet ads $1,500,000 Facebook banner ads TV websites where the commercials aired YouTube STRATEGY: SOCIAL MEDIA AMP Energy should also run sweepstakes and contests through their various social media handles:  CONTESTS FACEBOOK: Show us how you “Rethink Energy” Similar to Red Bull’s “Gives You Wings” campaign. Facebook users can upload photos demonstrating how they consume Amp Energy for every day needs. The first user to reach 1,000 likes is rewarded
 CROSS PROMOTION THROUGH SOCIAL MEDIA AMP should use social media pages as a cross promotion tool. Following brands on twitter and retweeting their posts, and well as “liking” their face book pages. (Vitamin Water, Energy Bars, Sports Magazines, Special Olympics etc) OBJECTIVE #2: CHANGE BRAND PERCEPTION FROM EXTREME to EVERYDAY ATHLETES/ SPONSORSHIP / ADVERTISEMENTS o AMP has repositioned its brand to cater to the everyday needs of everyday consumers. To avoid brand confusion, AMP Energy should look into new sponsors and endorsees outside of extreme sports athletics. The new faces of AMP should reflect AMP’s new brand, and match their new line of innovative products. o PepsiCo eliminated all 15 of Amps categories and created a product line of 3 with all new formulations and designs: AMP BOOST, AMP ACTIVE, and AMP FOCUS. AMP has now reentered the introductory stage of the product lifecycle. o AMP FOCUS:  A college student during an exam  A young professional prepping for an interview o AMP ACTIVE  An NBA/NFL/MLB Player  An Olympic gymnast  A college athlete o AMP BOOST  A stay at home mom or dad  A college student pulling an all night study session
IX. BUDGET & CALENDAR 2014 Marketing Plan Calendar - January through April o Launch National Media Campaign in select cities  Topic: Initial Campaign launch “Rethinking Energy”  CHI, DET, GPD, CLV, and MSM o Winter Promotions  Face book and Twitter contests and giveaways - May through July o National Media Campaign in select cities  Topic: Summer Break/ Vacation Cool off with AMP o Spring Promotions  Bikini Body! Stay in shape for the summer! Partnering with fitness clubs and protein bars - August through October o National Media Campaign in select cities  Topic: Back to School  Busy moms, working dads, college students, etc o Fall promotions  Partnering with back pack giveaways and educational charities - October through December o National Media Campaign in select cities  Topic: Holidays! Black Friday Shopping Thanksgiving Dinner Frenzy Santa needs Amp to fly across the world…duh!
Marketing Budget for 2014: Total $15,000,000 - Media plan: $10,000,000 National Campaign   35% on TV – $3,500,000 Early Morning News (parents, professionals, and college students tend to be awake and getting ready, needing energy.) Late Fridge (Settling down to watch tv, late night “studyers”, procrastinators) 30% on Outdoor advertising $3,000,000 Outdoors in common city areas Downtown on taxis and in parking lots On public transportation  20% on Radio $2,000,000 Pandora Radio Early morning radio  15% on internet ads $1,500,000 Facebook banner ads TV websites where the commercials aired YouTube - Promotions : $5,000,000 o Cross promotions with various brands  Vitamin Water  Energy Bars  Granola Bars o Contests and sweepstakes  Social Media contests o Product Launch events  Major cities where national campaign airs  CHI, DET, GPD, CLV, MSM o Endorsements and Sponsorships
BIBLIOGRAPHY "The Top 15 Energy Drink Brands." The Top 15 Energy Drink Brands. N.p., n.d. Web. 14 Nov. 2013. "Energy Drinks in C-stores: Strong Summer for Red Bull, Monster, NOS, Full Throttle, Weaker Performance from AMP, Rockstar." FoodNavigator-USA.com. N.p., n.d. Web. 14 Nov. 2013. "Sales of Energy Drinks Surge, along with Controversy over Health Effects | The Salt Lake Tribune." The Salt Lake Tribune. N.p., n.d. Web. 14 Nov. 2013. "America’s Most Popular Energy Drinks." 247wallst.com. N.p., n.d. Web. 14 Nov. 2013. "Top Selling Energy Drinks." Statistic Brain RSS. N.p., n.d. Web. 14 Nov. 2013. "Energy Drinks: An Assessment of Their Market Size, Consumer Demographics, Ingredient Profile, Functionality, and Regulations in the United States." - Heckman. N.p., n.d. Web. 14 Nov. 2013. "Global Sports and Fitness Nutrition Foods and Drinks Industry." MarketWatch. N.p., n.d. Web. 14 Nov. 2013. www.spectrainfinet.com

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Marketing Plan: AMP Energy

  • 1.
    DEVELOPING A MARKETINGPLAN FALL 2013 COLUMBIA COLLEGE CHICAGO AMP ENERGY Zanah Thirus Zanahthirus@gmail.com 11/10/13
  • 2.
    EXECUTIVE SUMMARY Amp Energywas launched by PepsiCo in 2001. AMP Energy is the premier energy brand of Purchase, N.Y.-based Pepsi-Cola North America Beverages (PCNAB). With its energizing blend of B-vitamins and a specially formulated intense combination of taurine, ginseng, and guarana, AMP Energy provides the power needed to tackle everything in life, day or night. PCNAB is a division of PepsiCo, which offers the world's largest portfolio of billion-dollar food and beverage brands. Over the past several years, Amp Energy has seen a dramatic financial decline. In 2008, Amp was the 4th most bought energy drink (behind Red Bull, Monster, and Rock Star). Since then, PepsiCo’s CSD dollar sales have declined 1.4%. Amp Energy has moved to being the 5th most popular energy drink, below NOS and its leading competitors. Recently, the Amp Energy team decided to rebrand Amp. Eliminating all 15 flavors and reinventing 3. The following marketing plan contains a market summary, competitive overview, demographic summary, a financial analysis, and a media plan for the newly revamped brand strategy. The purpose of the marketing plan is to restructure Amp’s current marketing strategy to target its current primary consumer base (families and young professionals). Demographic charts and competitive overview charts are from Spectra and MRI.
  • 3.
    TABLE OF CONTENTS Tableof Contents p.1 Company Overview p.2 Market Summary p. 4 Competitive Analysis - AMP - Red Bull - Monster - Rock Star p.7 p.7 p.9 p.11 p.13 Competitive Analysis Summary p. 15 Channel Summary p.16 GAP Analysis p.18 SWOT Analysis p.20 Cultural Issues p. 22 Market Strategy & Programs - Marketing objectives - Financial Objectives - Target markets & Target Audiences - Positioning Strategy - Marketing Budget and Calendar p.23-34 Bibliography p.35
  • 4.
    History of Amp:A PepsiCo Brand Amp Energy is the energy drink version of Mountain Dew, created by PepsiCo, and released in 2001. AMP Energy is the premier energy brand of Purchase, N.Y.-based Pepsi-Cola North America Beverages (PCNAB). With its energizing blend of B-vitamins and a specially formulated intense combination of taurine, ginseng, and guarana, AMP Energy provides the power needed to tackle everything in life, day or night. PCNAB is a division of PepsiCo, which offers the world's largest portfolio of billion-dollar food and beverage brands Amp Energy was launched by PepsiCo in 2001. PepsiCo is one of the world’s leading food and beverage companies with over 65 billion in net revenue in 2012. Pepsi Co has a global portfolio of diverse and beloved brands including Pepsi, Gatorade, Lays, Amp, and Quaker. Pepsi Co employs over 250,000 employees in 200 countries across the globe, and the reported revenue growth in the beverage division was 4.5% in 2012. According to Pepsi Co’s website, 80% of the current executive team was promoted from within. The company headquarters is located in Purchase, NY. The current CEO is Indra Nooyi. Pepsi Co Brands are organized into the four global business units: Pepsi Co American Foods Pepsi Co American Beverages (Including Amp) Pepsi Co Europe Pepsi Co Asia, Middle East, and Africa (AMEA) According to Pepsi Co’s 2012 annual report, the company objectives include: Building and retaining top talent
  • 5.
    To focus ondriving cost savings and other productivity enhancements derived from our complimentary food and beverage portfolio. Reinforce our existing value drivers (refocusing efforts on most popular global brands). PepsiCo’s original strategy for Amp was to position it to compete with leading energy drink brands like Red Bull and Monster. PepsiCo repositions AMP: In 2008, AMP was America’s 4th most popular Energy drink (behind Red Bull and Monster). That year, PepsiCo decided to “amp up” Amp’s media budget and positioning strategy. PepsiCo launched a massive campaign starring Nascar driver dale Earnheardt Jr., three new flavors, a high profile summer promotion, and a slew of packaging variations. This was all in an attempt to increase Amp’s presence in the Energy Drink market, and to compete with the leading brands, Red Bull and Monster. Since the major campaign in 2008, Sales for Amp have taken a major drop. In the last year, PepsiCo’s CSD dollar sales have declined 1.4% amounting to “The Worst performance of PepsiCo in over a year”, according to Wells Fargo’s senior analyst, Bonnie Herzog. Amp is now sitting below Rockstar, NOS, and Starbucks Double Shot. Those three brands are sitting below Red Bull, and Monster. Something had to be done. This year, PepsiCo decided to rebrand and reposition Amp Energy. PepsiCo eliminated all 15 of Amps categories and created a product line of 3 with all new formulations and designs. “Our New line of innovative products provides a kick of energy to match anything the day brings. So tell your Monday morning to bring it on, your Friday night to wait up for you, and everything else in between to be ready. You’re on your way”- Amp Energy Team
  • 6.
    I. MARKET SUMMARY According towww.energyfiend.com, Energy Drinks are a billion dollar industry. Red Bull sold US$3.4 billion dollars of energy drink product in the 52 weeks prior to July 2013. Monster sold US$3.1 billion worth. A huge part of energy drink popularity is in the sponsorship efforts, with top brands spending large sums of money to achieve brand placement. Several energy drinks have definitely been lifting their marketing efforts and it’s paying off with their recent entrance into the top 15 energy drinks ranking. The leading energy drinks are Red Bull and Monster. Red Bull sold US$3.4 BILLION dollars of energy drink product in the 52 weeks prior to July 2013. Monster sold US$3.1 BILLION worth. The third leading energy drink is Rock Star. NOS is in fourth place, and AMP Energy is in 5th place. The energy drink market continues to grow even in light of the tough economy and increased health scrutiny. Soda sales have been declining steadily over the same period, while energy drink sales have been booming. Despite recent FDA scrutiny regarding the safety of these beverages, 2013 energy drink sales are up 6.7% over last year in the USA alone. FIG. 1
  • 7.
    CARBONATED BEVERAGE (INCLUDINGENERGY DRINKS) DEMOGRAPHIC SUMMARY – 2013 Spectra Reports The following four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest carbonated beverage consumers. Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 77 76 112 91 113 128 100 114 93 123 131 138 149 125 176 94 150 156 136 195 152 157 110 145 152 184 211 155 47 64 88 94 78 110 79 48 40 52 71 69 81 62 29 33 36 39 40 46 39 105 96 129 138 135 176 132 97 89 98 121 123 120 107 78 65 73 101 86 85 80 84 79 99 106 103 123 100 Very High: 150+ High: 120-150 FIG. 2 Demographic Skews Male Head Only with Children 5+ Person Households Oldest Child 12 - 17 Not a High School Graduate Presence of Only Children 6 - 17 Farming, Fishing & Forestry Occupations Female Head Only with Children Precision Production, Craft & Repair Occupations Struggling Rural Mix Presence of Both Children Under 6 and 6 - 17 Total Consumption 4% 18% 25% 20% 27% 1% 11% 15% 4% 9% Index 178 165 158 151 146 145 144 141 140 138 FIG. 3
  • 8.
    Race of Headof Household-Total Consumption Index 150 100 50 0 White Black Hispanic Asian Other FIG 4 Source: Homescan Product Library 2013 Sep (Spectra) Household Income-Total Consumption Index 150 100 50 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More Source: Homescan Product Library 2013 Sep (Spectra) FIG 5
  • 9.
    II. Competitive AnalysisAMP/ REDBULL/ MONSTER/ ROCKSTAR A. AMP ENERGY The following four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest AMP ENERGY consumers . Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. FIG 6 LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 95 46 210 137 187 294 163 350 62 153 118 95 229 159 179 72 124 197 161 370 195 168 173 143 57 139 200 152 148 110 144 147 104 69 123 44 61 18 71 32 57 47 17 36 10 29 7 15 17 361 36 242 96 66 88 145 61 50 60 86 46 36 53 39 12 15 46 84 16 32 138 68 104 100 83 113 100 Very High: 150+ High: 120-150
  • 10.
    Total Consumption Demographic Skews Transportation &Material Moving Occupations Age 18 - 24 5+ Person Households Presence of Only Children 6 - 17 Oldest Child 12 - 17 Multi-Person Households without Children Age 35 - 44 Farming, Fishing & Forestry Occupations Age 25 - 34 Married Families with Children 13% 12% 22% 35% 29% 26% 32% 1% 25% 34% Source: Homescan Product Library 2013 Sep (Spectra) 150 100 50 0 Black Hispanic Asian Other Source: Homescan Product Library 2013 Sep (Spectra) FIG 8 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More Source: Homescan Product Library 2013 Sep (Spectra) FIG 9 349 285 196 186 184 181 180 177 169 167 FIG 7 Race of Head of Household-Total Consumption Index White Index
  • 11.
    B. RED BULL Thefollowing four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest RED BULL consumers. Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. FIG 10 Demographic Skews Presence of Both Children Under 6 and 6 - 17 Male Head Only with Children Other Races Precision Production, Craft & Repair Occupations Age 25 - 34 Transportation & Material Moving Occupations 5+ Person Households Oldest Child 6 - 11 Hispanics Oldest Child Under 6 Total Consumption 18% 6% 5% 23% 32% 8% 23% 18% 24% 14% Index 269 259 231 215 212 205 203 195 192 192 FIG 11
  • 12.
    Race of Headof Household-Total Consumption Index 250 200 150 100 50 0 White Black Hispanic Asian Other Source: Homescan Product Library 2013 Sep (Spectra) FIG 12 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More Source: Homescan Product Library 2013 Sep (Spectra) FIG 13
  • 13.
    C. MONSTER The following fourcharts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest Monster Energy Drink consumers . Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 269 174 99 153 125 122 154 140 107 166 141 339 115 169 242 150 108 107 243 195 173 216 126 125 103 122 117 132 107 159 88 74 140 58 104 105 23 50 73 47 33 55 4 35 19 28 28 11 20 226 277 99 86 163 85 154 86 86 101 44 93 51 79 30 42 21 51 33 33 33 132 115 84 84 119 72 100 FIG 14
  • 14.
    Total Consumption Demographic Skews Male HeadOnly with Children Female Head Only with Children Transportation & Material Moving Occupations Oldest Child 12 - 17 Striving Small City Living Presence of Only Children 6 - 17 Presence of Only Children Under 6 Oldest Child Under 6 Administrative Support Occupations 4 Person Households 4% 14% 7% 27% 6% 32% 13% 13% 11% 22% Index 198 195 186 172 171 170 169 167 166 165 FIG 15 Race of Head of Household-Total Consumption Index 200 150 100 50 0 White Black Hispanic Asian Other FIG 16 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More FIG 17
  • 15.
    D. ROCK STAR Thefollowing four charts are 2013 consumer demographic from spectra. The charts show index numbers and total volume among the heaviest Rock Star Energy Drink consumers. Charts include data on race of head of household, household structure, household demographics, occupation of head of household and average household income. LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 131 242 158 349 109 139 185 132 164 95 155 82 82 116 273 688 316 203 120 103 267 65 124 129 63 166 153 121 42 48 78 61 78 64 61 30 26 53 39 264 31 83 12 13 68 13 67 18 34 49 118 135 152 80 134 112 107 25 36 98 84 111 72 52 21 69 111 19 35 45 72 124 103 112 109 80 100 Very High: 150+ High: 120-150 FIG 18
  • 16.
    Total Consumption Demographic Skews Male HeadOnly with Children Female Head Only with Children Transportation & Material Moving Occupations Oldest Child 12 - 17 Striving Small City Living Presence of Only Children 6 - 17 Presence of Only Children Under 6 Oldest Child Under 6 Administrative Support Occupations 4 Person Households 4% 14% 7% 27% 6% 32% 13% 13% 11% 22% Index 198 195 186 172 171 170 169 167 166 165 FIG 19 Race of Head of Household-Total Consumption Index 200 150 100 50 0 White Black Hispanic Asian Other FIG 20 Household Income-Total Consumption Index 200 100 0 Under $10,000 $10,000 - $19,999 $20,000 - $29,999 $30,000 - $39,999 $40,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $149,999 $150,000 or More FIG 21
  • 17.
    COMPETITIVE ANALYSIS/ DEMOGRAPHICS SUMMARY BASEDON 2013 SPECTRA CONSUMER REPORTS Across the board, Amp Energy and its main competitors have similar heavy consumers.: **FIG. 2, 6, 10, 14, and 18** Start up families Younger bustling families Older bustling Families Rock Star was the ONLY competitor with a high index number among the Independent Singles category. **FIG 18** The majority of consumers are Families or couples ** FIG 3,7,11,15 and 19** All consumers with high index numbers had children (most times, more than one child) ** FIG 6,10,14,and 18 ** The Head of Household occupations with the highest index numbers are **FIG 7, 11, 15, and 19** o o Careers in Precision, production, craft & repair Transportation and material moving The majority of consumers with the highest index numbers **FIG 7,11,15, and 19* o Owned more than one vehicle o Were not married, but had children o Lived in a 3-5 person household o Were single parents Household income among heavy consumers ranged from o $10,000-$70,000 FIG **5,9,13,17 and 21** Majority of consumers purchased energy drinks from grocery stores (based on channel summary) ** FIG 22-25 Majority of consumers are Hispanic or Mixed races.
  • 18.
    III. Channel Summary AMPFIG 22 Channel Summary Grocery Mass Merchandise All Other Drug Total Volume per 100 HHs % Volume 59% 19% 17% 5% 7.21 2.27 2.04 0.64 RED BULL FIG 23 Channel Summary Grocery All Other Mass Merchandise Drug Source: Homescan Product Library 2013 Sep (Spectra) % Volume 41% 34% 17% 7% Total Volume per 100 HHs 17.15 14.23 6.94 3.02
  • 19.
    MONSTER FIG 24 ChannelSummary % Volume Grocery Club Mass Merchandise All Other Convenience Drug Total Volume per 100 HHs 40% 33% 14% 6% 5% 2% 29.46 24.14 9.88 4.74 3.60 1.31 ROCK STAR FIG 25 Channel Summary All Other Grocery Source: Homescan Product Library 2013 Sep (Spectra) % Volume 53% 47% Total Volume per 100 HHs 7.77 6.82
  • 20.
    IV. GAP ANALYSIS– Products and Services AREAS OF CONCERN HIGHLIGHTED IN RED AMP RED BULL Products Products 7 products 3 categories: BOOST, ACTIVE, & FOCUS SPORTS: Sponsors 6 athletes including Dale EarnHardt Jr. Company: Majority of Amp Energy promotions are through social media: Face book & Twitter Product Divisions: Sugar Free, Total Zero, and Editions (Blue, Red, and Silver). COMPANY Red Bull TV Sponsors over 100 athletes in biking, surfing, snowboarding, and motorsports. Red Bull Music Academy 100% recyclable products Wings team/ Student Brand Managers Red Bull Graduate School SPORTS DIVISIONS Red Bull Racing Red Bull Crashed Ice Red Bull X Fighters Red Bull BC OWE MONSTER ROCKSTAR PRODUCTS: 34 different products 6 different categories (Monster Energy, Java monster, DuB, Rehab, Extra Strength, Muscle Monster). PRODUCTS SPORTS DIVISIONS Sponsors athletes in 21 motor sports Sponsors athletes in 9 action sports Roster of over 30 athletes COMPANY Monster Girls Monster TV Sponsors bands and tours : MONSTER OUTBREAK TOUR OVER 20 different flavors SPORTS DIVISIONS Sponsors athletes in 11 action sports (BMX, skating, Skiing, snowboarding.) Sponsors athletes in 5 different motorsport divisions COMPANY Represents models Represents music artists PRODUCTS AVAILABLE ONLINE
  • 21.
    V. PEST ANALYSIS Political Factor: Regulationabout content of energy drinks from US Food and Drug Administration (FDA) Economic Factor: According to Spectra Product Reports , the vast majority of energy drink consumers are in families of 3-5 and may be price sensitive when shopping for beverages. Social Factor: Consumers are now becoming more health conscious, and may lean toward healthier choices such as: o Vitamin water o Coffee o Low calorie energy shots o Energy bars o Protein shakes Online Shopping is becoming very popular. Majority of energy drinks do not offer their products online/via their website. Technological Factor: Social Media Era: o In order to keep up with the competition, the majority of products have to have social media pages to promote their product.  Facebook  Twitter  Instagram  Pintrest  Tumblr o Online Shopping is becoming very common among grocery store shoppers
  • 22.
    VI. SWOT ANALYSIS STRENGTHS: A.AMP is a division of a well known company, PepSiCo. . B. The Law of Contraction: “A Brand Becomes Stronger When You Narrow Its Focus.” Amp has eliminated all 15 products and created a small line of 3 products with 7 flavors. C. Amp’s new target consumer is the consumer with a practical need for energy. This matches the primary energy drink consumer: Families Those with transportation & moving careers. Single parents Early risers & Late nighters WEAKNESS: Competitive Situation Amp’s competitors (Red Bull, Monster, and Rock Star) offer WAY more than Amp does. Amp has to now focus on rebuilding its fan base in order to compete with well known competitors. Each competitor:  Has a TV station to promote its athletes and events Uses models to represent the brand: Wings Team Girls (Red Bull), Monster Girls, Rock Star Models. Sponsors at least 20 athletes. Represents music artists or sponsors tours
  • 23.
    OPPORTUNITIES: Amp has theopportunity to build its brand presence through the media. Since Amp’s target and brand is different than the majority of energy drinks, they have an opportunity to gain market leadership among other beverage categories. Very few energy drink and/or beverage companies sell their products online. This can be a new opportunity for AMP. THREATS: Revamping the brand turns indirect competition into direct competition. Amp is now all about a consuming energy drinks for practical reasons. A healthier choice for a healthier lifestyle. This means Amp is now competing with:     Vitamin Water Low calorie energy shots Protein shakes Energy bars
  • 24.
    VII. CRITICAL ISSUES “Thingschanged. We're not just playing hard, we're working hard, too. So we need energy for different reasons: To get a hop in our step, fuel our passions, or to get in the "zone". That's why AMP Energy is rethinking energy. Our full lineup of innovative products provides a kick of energy to match anything the day brings. So tell Monday Morning to bring it on, Friday Night to wait up for you, and everything in-between to be ready. You're on your way.” – The AMP Energy Team Amp Energy has completely revamped its brand. Although this decision has its advantages, it may put Amp on thinner ice. Amp is now competing with two different sets of competitors since they revamped their brand: Energy Drinks: Red Bull, Monster, Rock Star, etc Healthy Energy Choices : Vitamin water, protein shakes, etc Amp’s brand does not offer as many elements as its competitors. Amp sponsors less than half of the athletes that its leading competitors sponsor. Red Bull, Monster, and Rock Star all have brand models (Monster Girls, Wings Team Girls, and Rock Star Models), Amp does not. Amp Energy eliminated 15 products and moved to a line of 3 functional drinks. They eliminated several consumer favorites, which means they will have to go the extra mile to regain consumers that they lost.
  • 25.
    VIII. Marketing Strategyand Programs A. The Central Idea  AMP Energy has completely revamped its brand. Consumers and the energy drink market should be fully aware of PepsiCo’s efforts to reposition AMP. This new positioning strategy needs to be enforced through social media, and all advertising mediums. B. Mission “ Things changed. We're not just playing hard, we're working hard, too. So we need energy for different reasons: To get a hop in our step, fuel our passions, or to get in the "zone". That's why AMP Energy is rethinking energy.” – The AMP ENERGY TEAM C. Positioning Strategy “Be smart about managing your energy. Introducing the new line-up of AMP Energy drinks to help fuel life, career, family, and everything else that matters to you. So saddle up partner. Let's get it done.” – AMP Energy AMP’s new full lineup of innovative products provides a kick of energy to match anything the day brings. Unlike its competitors, AMP focuses on the smart way to manage your energy, and provides unique products that cater to the everyday needs of its consumers. The new positioning strategy focuses on two target markets : Families & Young Professionals. . According to spectra demographic reports, families represent 54% of AMP’s total volume segment. Target Audience #1 o o o o o o o Age 25-44 Parents Grocery Store Shoppers Career parents & stay at home parents Early Risers and Late Nighters Single and/or married Health conscious shoppers
  • 26.
    o Households with3-5+ persons Target Audience #2 o o o o o Age 18-24 Early Risers & Late Nighters Athletes College Students Recent Graduates Total Consumption Demographic Skews Transportation & Material Moving Occupations Age 18 - 24 5+ Person Households Presence of Only Children 6 - 17 Oldest Child 12 - 17 Multi-Person Households without Children Age 35 - 44 Farming, Fishing & Forestry Occupations Age 25 - 34 Married Families with Children Index 13% 12% 22% 35% 29% 26% 32% 1% 25% 34% 349 285 196 186 184 181 180 177 169 167 Source: Homescan Product Library 2013 Sep (Spectra) LifeStyle BehaviorStage Start-Up Families HHs with Young Children Only < 6 Small Scale Families Small HHs with Older Children 6+ Younger Bustling Families Large HHs with Children (6+), HOH <40 Older Bustling Families Large HHs with Children (6+), HOH 40+ Young Transitionals Any size HHs, No Children, < 35 Independent Singles 1 person HHs, No Children, 35-64 Senior Singles 1 person HHs, No Children, 65+ Established Couples 2+ person HHs, No Children, 35-54 Empty Nest Couples 2+ person HHs, No Children, 55-64 Senior Couples 2+ person HHs, No Children, 65+ Total Cosmopolitan Centers Affluent Suburban Spreads Comfortable Country Struggling Urban Cores Modest Working Towns Plain Rural Living Total 1.0% 0.7% 2.5% 1.4% 2.6% 4.0% 12.2% 3.2% 0.9% 2.1% 1.2% 1.3% 3.6% 12.4% 1.3% 0.8% 1.5% 2.2% 2.1% 5.8% 13.6% 2.2% 4.6% 2.7% 0.7% 2.2% 3.4% 15.9% 3.4% 1.2% 1.5% 3.3% 2.4% 1.0% 12.8% 0.9% 1.0% 0.3% 1.4% 0.8% 1.4% 5.8% 0.2% 0.5% 0.2% 0.3% 0.2% 0.4% 1.7% 5.7% 0.7% 4.9% 1.2% 1.2% 2.0% 15.7% 0.8% 1.1% 1.4% 0.8% 0.8% 0.9% 5.9% 0.6% 0.3% 0.4% 0.5% 1.8% 0.5% 4.0% 19.3% 11.7% 17.5% 13.0% 15.5% 23.0% 100.0%
  • 27.
    Target Market DemographicInformation - Which locations are we focusing our marketing efforts? Local Market Behaviors- What are common shopping behaviors of our target market within these locations? LOCATION For this Marketing Plan, we will market towards Amp Energy’s consumers with the highest total volume sales, Families & Young professionals. Families & Young professionals make up 54% of Amp’s total sales. We will target these groups within 5 Midwestern metropolitan areas. Chicago (CHI) Cleveland (CVL) Detroit (DET) ( Grand Rapids/Kalamazoo/Battle Creek (GPD) Minneapolis/St Paul (MSM) Families and Young Professionals within these locations are the exact market that AMP Energy is targeting. The early risers, the late nighters, those with a busy schedule and a practical use for every day energy. LOCAL MARKET BEHAVIORS According to 2013 Spectra Reports, Local Market Behaviors for Chicago, Cleveland, Detroit, Grand Rapids, and Minneapolis include high indexes & sales volume in: (CHI) - Spending $100-$499 on children’s clothing within 12 months Buying cosmetics, perfume and hair products Eating at fast food restaurants frequently Own a used vehicle (CVL) - Are Saturday & Sunday newspaper readers Watch morning news repeatedly Household owns Ipod, MP3, Digital Recorder or Gaming system Own smart phones
  • 28.
    (DET) - Shop at Hardwarestores frequently Shop at Mass Merchandise stores frequently Social Media users (Facebook, Twitter, Instagram) Household owns video game system (GPD) - Health conscious eaters Eco Friendly activities done on a regular basis Online Shoppers Typically watch late night programs
  • 29.
    D. Financial Objectives AMPEnergy’s sales dropped from 300 million to 239 million in 2013. AMP Energy went from being the 4th most popular energy drink, to the 5th most popular. Our sales goal is to increase sales by 5% in each quarter of 2014. Our profitability goal is to increase profits by 5%. Sales Goals 2014 Q1 - $250,950,000 Q2- $263,497,500 Q3-$276,672,375 Q4- $290,505,993 E. Marketing Objectives OBJECTIVE #1: Increase Market Awareness by 18% in 12 months STRATEGY: MEDIA AWARENESS: o Rapid Penetration- low price/high promotion o AMP Energy could benefit from a national advertising campaign titled “Rethinking Energy”. Consumers and the energy drink market should be fully aware of PepsiCo’s decision to rebrand AMP. AMP’s new positioning strategy is clear through their website, but nowhere else. Not many consumers are aware of AMP’s new lineup of drinks, or their new strategy. The new AMP needs to be advertised via television, radio, and magazine. - PROGRAMS : Media Mix  TV: Early News ($7,700 CPP) Late Fringe ($20,000 CPP) Primetime ($25,300 CPP)  Radio Network Radio ($8,500 CPP)  Outdoor Ads Downtown Coverage/Parking lot displays -$60,000 x 30% increase due to National campaign.
  • 30.
     - Wrapped Train -$30,589x 30% increase due to national campaign Taxi tops - $120,000 x 30% increase due to national campaign Internet ads Banner ads Social Media Websites Youtube Budget Plan  $10,000,000 National Campaign  35% on TV – $3,500,000 Early Morning News (parents, professionals, and college students tend to be awake and getting ready, needing energy.) Late Fridge (Settling down to watch tv, late night “studyers”, procrastinators)  30% on Outdoor advertising $3,000,000 Outdoors in common city areas Downtown on taxis and in parking lots On public transportation  20% on Radio $2,000,000 Pandora Radio Early morning radio  15% on internet ads $1,500,000 Facebook banner ads TV websites where the commercials aired YouTube STRATEGY: SOCIAL MEDIA AMP Energy should also run sweepstakes and contests through their various social media handles:  CONTESTS FACEBOOK: Show us how you “Rethink Energy” Similar to Red Bull’s “Gives You Wings” campaign. Facebook users can upload photos demonstrating how they consume Amp Energy for every day needs. The first user to reach 1,000 likes is rewarded
  • 31.
     CROSS PROMOTION THROUGHSOCIAL MEDIA AMP should use social media pages as a cross promotion tool. Following brands on twitter and retweeting their posts, and well as “liking” their face book pages. (Vitamin Water, Energy Bars, Sports Magazines, Special Olympics etc) OBJECTIVE #2: CHANGE BRAND PERCEPTION FROM EXTREME to EVERYDAY ATHLETES/ SPONSORSHIP / ADVERTISEMENTS o AMP has repositioned its brand to cater to the everyday needs of everyday consumers. To avoid brand confusion, AMP Energy should look into new sponsors and endorsees outside of extreme sports athletics. The new faces of AMP should reflect AMP’s new brand, and match their new line of innovative products. o PepsiCo eliminated all 15 of Amps categories and created a product line of 3 with all new formulations and designs: AMP BOOST, AMP ACTIVE, and AMP FOCUS. AMP has now reentered the introductory stage of the product lifecycle. o AMP FOCUS:  A college student during an exam  A young professional prepping for an interview o AMP ACTIVE  An NBA/NFL/MLB Player  An Olympic gymnast  A college athlete o AMP BOOST  A stay at home mom or dad  A college student pulling an all night study session
  • 32.
    IX. BUDGET &CALENDAR 2014 Marketing Plan Calendar - January through April o Launch National Media Campaign in select cities  Topic: Initial Campaign launch “Rethinking Energy”  CHI, DET, GPD, CLV, and MSM o Winter Promotions  Face book and Twitter contests and giveaways - May through July o National Media Campaign in select cities  Topic: Summer Break/ Vacation Cool off with AMP o Spring Promotions  Bikini Body! Stay in shape for the summer! Partnering with fitness clubs and protein bars - August through October o National Media Campaign in select cities  Topic: Back to School  Busy moms, working dads, college students, etc o Fall promotions  Partnering with back pack giveaways and educational charities - October through December o National Media Campaign in select cities  Topic: Holidays! Black Friday Shopping Thanksgiving Dinner Frenzy Santa needs Amp to fly across the world…duh!
  • 33.
    Marketing Budget for2014: Total $15,000,000 - Media plan: $10,000,000 National Campaign   35% on TV – $3,500,000 Early Morning News (parents, professionals, and college students tend to be awake and getting ready, needing energy.) Late Fridge (Settling down to watch tv, late night “studyers”, procrastinators) 30% on Outdoor advertising $3,000,000 Outdoors in common city areas Downtown on taxis and in parking lots On public transportation  20% on Radio $2,000,000 Pandora Radio Early morning radio  15% on internet ads $1,500,000 Facebook banner ads TV websites where the commercials aired YouTube - Promotions : $5,000,000 o Cross promotions with various brands  Vitamin Water  Energy Bars  Granola Bars o Contests and sweepstakes  Social Media contests o Product Launch events  Major cities where national campaign airs  CHI, DET, GPD, CLV, MSM o Endorsements and Sponsorships
  • 34.
    BIBLIOGRAPHY "The Top 15Energy Drink Brands." The Top 15 Energy Drink Brands. N.p., n.d. Web. 14 Nov. 2013. "Energy Drinks in C-stores: Strong Summer for Red Bull, Monster, NOS, Full Throttle, Weaker Performance from AMP, Rockstar." FoodNavigator-USA.com. N.p., n.d. Web. 14 Nov. 2013. "Sales of Energy Drinks Surge, along with Controversy over Health Effects | The Salt Lake Tribune." The Salt Lake Tribune. N.p., n.d. Web. 14 Nov. 2013. "America’s Most Popular Energy Drinks." 247wallst.com. N.p., n.d. Web. 14 Nov. 2013. "Top Selling Energy Drinks." Statistic Brain RSS. N.p., n.d. Web. 14 Nov. 2013. "Energy Drinks: An Assessment of Their Market Size, Consumer Demographics, Ingredient Profile, Functionality, and Regulations in the United States." - Heckman. N.p., n.d. Web. 14 Nov. 2013. "Global Sports and Fitness Nutrition Foods and Drinks Industry." MarketWatch. N.p., n.d. Web. 14 Nov. 2013. www.spectrainfinet.com