EXECUTIVE SUMMARY 2
CONTENTS 3
INTRODUCTION – Jayne to read over 6
SITUATION ANALYSIS 7
MISSION STATEMENT(S) 8
PRODUCT DEFINITION 8
AT THE INDUSTRY LEVEL (TOTAL OF ALL PRODUCT CATEGORIES): 8
AT EACH PRODUCT CATEGORY LEVEL 8
THE MARKET – CUSTOMERS (END USERS) FOR THE PRODUCT CATEGORIES TARGETED BY OUR ORGANISATION 10
SCOPE 10
EXTERNAL ENVIRONMENT: REMOTE ENVIRONMENT 10
ECONOMIC FORCES 10
Scenario:
1. The soft drink market is so influenced by the markets top 3 companies’ that any new entrant is immediately counter attacked. 11
2. The global financial crisis has had such an effect on the market that consumers’ are more hesitant to invest in Virgin’s new venture. 11
3. The global financial crisis has lead consumers to become more spending conscious, reduced spending, reducing the likelihood of consumers trying a new brand. 11
Implications: 11
Compared to the dominant competitors, our price point will not be as competitive which could influence consumer purchasing decisions however compared to other healthy alternatives within the product category. A slip in consumer confidence as a result of the Global Financial Crisis. This threatens entry into any market and considering the rise in the cost of living which affects the carbonated soft drink market as it is a luxury. 11
SOCIO-CULTURAL FORCES 12
Socio-cultural forces heavily impact the carbonated soft drink market. The Australian populations expenditure on food and non-alcoholic beverages heavily impacts the carbonated soft drink market. Socio-cultural trends also have an impact on the market. The ‘health’ trend changes the way that competitors formulate new products and recreate their existing products. 12
Scenario: 12
1.The top 3 players each introduce brand new flavours to keep up with the health trend, which expands the market but makes it harder for new entrants to succeed. 12
2.The ‘healthy’ trend is moving into the later stages of maturity of the product life cycle and consumers’ become bored/skeptical of it. 12
3.A further population increase will expand the market and develop more opportunities for a niche market to be introduced. 12
4.An increase in the birth rate will increase the amount of children that are present during the late growth, early maturity stages of a new product. 12
Implications: 12
Marketing a carbonated soft drink as a healthy alternative consumers may be sceptical (consider vitamin water, was marketed as a healthy alternative, but is full of sugar.) 12
The impact that political and legal forces have on the carbonated soft drink market basically relate purely to the labelling and ingredient content in the products. 13
Scenario: 13
1.Labelling laws change forcing companies to recall products and relabel, costing large amounts of money 13
2.Drought affects Australia increasing water usage costs even higher than they already are. 13
Implications: 13
Virgin Cola does not have the money to spend on relabelling or changing the label of their soft drinks, therefore labelling must abide by the conditions of the ACCC to prevent any issues. 13
The ACCC requires by law that labelling give sugar and kilojoule content. 14
TECHNOLOGICAL FORCES 14
Technological forces have a high impact on the carbonated beverage market in Australia, continuing technological advancements allow the supply chain of competitors to become faster and faster. The development of things such as recyclable bottles and new and improved vending machines also adds another dimension to the carbonated soft drink market. 14
Scenario: 14
Implications: 14
The continual advancement in technological forces will effect potential new entrants. New entrants are looking for a point of differentiation and technological advancements may be this point. 14
New and improved ingredients can be used in Virgin Cola, ingredients that are cheaper can be found and worked with. 15
Technological advancements can result in more efficient supply chain management 15
Technology impacts this industry less which means less capital investment 15
NATURAL ENVIRONMENT FORCES 15
Scenario: 15
Implications: 15
Companies must take into account the unpredictablility of natural disasters which heavily effect the production of natural and raw materials. 15
EXTERNAL ENVIRONMENT: NEAR ENVIRONMENT 16
INDUSTRY/MARKET REVIEW 16
FORCES 17
TYPE OF FORCE 17
STRENGTH 17
Description: 19
Yoffie D. & Kim R. 2011, ‘Cola Wars Continue: Coke and Pepsi in 2010 ‘,Harvard Business School, 9-7-11-46, pp. 1 - 22 20
Implications: 20
COMPETITIVE REVIEW 21
Description: 38
Implications: 38
DISTRIBUTION CHANNELS AND BUYERS (INTERMEDIARY CUSTOMERS) 39
Description: 41
Implications: 41
END-USER CUSTOMERS 41
Description: 41
Implications: 41
Datamonitor 2011. Soft Drinks in Australia, Available: http://360.datamonitor.com.ipacez.nd.edu.au/Product?pid=889413C8-178F-43C0-8BD7-4FD8C32C0B1F. Accessed: 05 March 12. 42
Description: 42
Implications: 42
CRITICAL SUCCESS FACTORS (CSFS) 43
SUMMARY OF OPPORTUNITIES AND THREATS 44
SITUATION ANALYSIS – INTERNAL CAPABILITIES 46
Review: 49
Implications: 49
PROBLEMS AND OPPORTUNITIES STATEMENT 49
RECOMMENDATIONS AND RATIONALE 50
MARKETING OBJECTIVES: (See Exhibit 2.4 for examples) 50
EXAMPLE OF MARKETING STRATEGIES: 50
APPENDIX 52
APPENDIX A 52
APPENDIX B 55
APPENDIX C 55
APPENDIX D 57
APPENDIX E 57
APPENDIX F 62