Crescent pure - Case Study
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Crescent Pure was a non-alcoholic beverage founded in 2008 and acquired by Portland Dark Beverages in 2013. It contained energy-enhancing, hydrating, and organic ingredients. Michael Booth, the CEO of PDB, was analyzing options to position Crescent Pure either as an energy drink or sports drink. Positioning it as an energy drink offered larger market share but also faced more competition and negative publicity regarding health risks. Positioning it as a sports drink faced a smaller market but was seen as more refreshing and healthy. Through market insights and break even analysis, Booth evaluated highlighting Crescent Pure's healthy and organic roots as a potential strategy.
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Crescent pure - Case Study
- 1. CRESCENT PURE Harvard Case Analysis 1
- 2. Introduction Crescent Pure was a non-alcoholic functional beverage The drink’s combination of energy-enhancing, hydrating, and organic ingredients. 2
- 3. The CEO of Portland Dark Beverages (PDB), Michael Booth acquired it in 2013 3 The drink was first founded by Peter Hoops in 2008 It was well received locally, due its Organic nature and unique taste THAT’s HOW IT HAPPENED
- 4. “ ▫ T ▫ T P , 4 STRATEgies
- 5. BUT WHY Crescent Pure ? ▫ Comparatively 70% less sugar. ▫ Minimal caffeine content. ▫ Natural, Healthy, Hydrating 5
- 6. Main Options Available ▫ Energy Drink ▫ Sports Drink 6 PRODUCT POSITIONING
- 7. 7 ENERGY DRINK PROS: ➢ Market share was projected to reach 13.5 billions by 2018. ➢ Healthier and low levels os sugar compared to competitors. ➢ The suggested price $2.75 was less than the Average price $2.99 ➢ Attracts more Male consumers 18-34.
- 8. 8 ENERGY DRINK CONS: ➢ Negative Media publicity regarding health risks ➢ 32% people avoided energy drinks in past years ➢ 11% people reduced taking them being health conscious. ➢ High competition among top 4 players, combinedly occupying 85% Market share.
- 9. 9 COMPEtitiors In ENERGY DRINKS 1. Fright 2. Razor 3. Torque 4. Stellar
- 10. PROs: ▫ 42% of sports beverage drinkers considered sports drinks “anytime beverages” ▫ Regular users consume sports drink more often ▫ It is described more often as refreshing, healthy, fun and hydrating than energy drinks 10 SPORTS DRINK
- 11. CONs: ▫ Market is $2.2 billion less than energy drink market ▫ Crescent’s $2.75 price point for an 8 oz.can is significantly higher than other competing sports drinks. ▫ Recent govt. mandated guidelines to remove sugary,high calorie drinks from school vending machines. 11 SPORTS DRINK
- 14. DEMOGRAPHICS A B C Yellow 10 20 7 Blue 30 15 10 Orange 5 24 16 14
- 16. energy DRINK Highligthing its Healthy & ORanic Roots PROS: ▫ Healthier and Organic alternative. ▫ Organic beverages claimed a price premium over convenctional beverages. ▫ PDB will have a wider customer presence in additional segments. 16 ANAlysis
- 17. energy DRINK Highligthing its Healthy & ORanic Roots CONS: ▫ Feasible budget $7,50,000 ▫ SHORT OF TIME, SHOULD HURRY UP. ▫ LIMITED DISTRUBuTERS. ▫ People may doubt the quality with low price 17 ANAlysis
- 18. WIll IT Break Even ? 18 Let’s see
- 19. BREAK EVEN ANALYSIS Advertising costs (Benchmark goal) $750,000 Price per each 8-ounce can $1.24 Variable costs $1.02 Profit per can $0.22 No.of cases produced per month 12000 Cans / each case 24 Profit per month $63,360 Profit per year $760,320 Net profit (Beyond Break Even) $10,320
- 20. SUMMARY 20 STRATEGIES ANALYSIS and BREAK EVEN PRODUCT POSITIONING
- 21. 21 Thank you ! Created by A.S.R.Sai Teja. NIT RAIPUR. Submitted to Prof.Sameer Mathur, IIM LUCKNOW as a part of Marketing Internship.