A Harvard Business School Case Study

1. CRESCENT PURE
A Harvard Business School
Case Study

3. • Founded in 2008 by Peter Hooper, a
native of Crescent Oregeon
• The drink was sold in regional grocery
chains
• The drink was priced $3.75 for 8-ounce
can
• After one year, Hooper secured legal
protection for his propriety recipe.

4. SITUATION
• Portland Drake Beverages (PDB) acquired
Crescent with an aim of expanding and
maximising revenues
• Production capacity constraints prevented PDB
from launching the drink in 2015. Hence PDB
has planned to embark on a soft launch in 2014
• Sarah Ryan, VP- Marketing at PDB needs to
finalise the product positioning strategy for
Crescent Pure.

5. MARKETING POSITIONING
OPTIONS
• ENERGY DRINK • SPORTS DRINK
• ORGANIC DRINK

6. CRESCENT PURE V/S ENERGY
DRINK
PROS
• Forecast predicted the market
for energy drink to reach $
13.5 billion by 2018
• Average price for 8 ounce can-
$2.99
• Largest group of consumers :
males between 18-34 years
• Due to demand for healthier
drinks, sales of energy drinks
with lower levels of caffeine
and purer ingredients have
increased
CONS
• Fright, Razor,Torque and
Stellar together accounts for
85% of the market
• Health risks
• Only 32% of consumers had
an energy drink in the past 6
months
• 11% of them decreased
consumption due to health
risks

7. CRESCENT PURE V/S SPORTS
DRINK
PROS
• Expected to grow to
$9.58 billion by 2018
• Attracted wider
consumer base than
energy drinks
• Increasing demand for
diet and low sugar sports
drinks
• Market size for diet
sports drink expected to
rise
CONS
• Obesity among children
• Gleam and Drip
occupied 73% and 21%
market share respectively
• Only 27% of the
consumers are females
• Avg $1 to $2 for 12 & 14
ounce containers
respectively

9. ENERGY DRINKS

10. Market Size
Market size for energy drinks
had grown by 40% in 2 years
and estimated to be $13.5
billion by 2018
Competition
5 company accounts for 85%
of total revenue.
Opportunities
Demand of energy drinks with
Lower caffeine is increasing
Due to customers demand
For Healthier food.
Threats
New stories posses that energy
Drinks posses health risks and
People are consuming fewer
Energy drinks than before.

11. SPORTS DRINKS

12. Market Size
Market size for sports drinks
had grown by 9% in 2 years
and estimated to be $9.58
billion by 2018
Competition
Gleam and Drip has 73% and
23% market share
Opportunities
New diet and low sugar sports
Drinks are the growth area for
The industry
Threats
Rising childhood obesity

13. CONSUMER ANALYSIS

14. Demographics of Consumer

15. Respondents Described Crescent
as (%)

17. BREAK EVEN ANALYSIS
• In order to break even net revenue must
be greater than $750,000
• Variable costs for 1 can=$1.02
Selling price for 1 case=$29.76 ($1.24 per
case) i.e. 24 cans per case
• In order to break, 11,837.2 cans per
month need to be sold.(<12000 production
capacity- therefore break even to be
decided by amount of sale)

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
perceptions
 First is the Best
 Opportunity to also branch into sporta
drink market with product line extensions

19. DISCLAIMER
Created by Nandita Biswas, Jadavpur University, during
a marketing internship under Prof. Sameer Mathur, IIM
Lucknow.