Professional Documents
Culture Documents
Contents
Case Background
Synopsis of Snapple
Rise of Snapple:1973-92
Fall of Snapple:1993-97
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Case Background ?
Overview Many soft-drink brands flourished in the 1980s serving New York's Yuppies Only Snapple could transition from local to national success . It was poised to go international when the founders sold out to Quaker. The brand proved harder to manage than Quaker anticipated and in 1997 was sold for a fraction of its acquisition price. The case presents factors accounting for the growth and decline and provides a qualitative study of the brand. What action should the new owners take?
Topics Covered
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Synopsis of Snapple
In 1972, Snapple was created which was formally known as Unadulterated Food Production. The initial product offered was solely apple soda, which was named Snapple. It targeted at the young, health conscious market segment. Subsequently, the company became more successful, a variety of non-carbonated beverages were then introduced and it began expanding its distribution. In 1994, the company was sold to Quaker Oats for $1.7 billion. However, Quaker was unsuccessful in building Snapples brand value as evidenced by the decline in sales. Later in 1997, Quaker sold the Snapple to Triarc Beverages for $300 million
The case delves into rise and fall of Snapple and reasons behind it
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Price
A premium pricing strategy was employed as Snapple targeted at the niche, premium beverage market It had price as an indicator of quality which was consistent with its positioning strategy
Although not all products succeed, the loyalty of customers assisted Snapple in driving marketshare in targeted market
Promotion
The success of the entrepreneurial founders often resulted in Snapple being reported by several medias.
Threats
Indirect channel distribution marketing strategy was exploited Snapple had a very little supermarket coverage
Secondary associations -Wendy:Spokesmodel. Wendy possessed personality attribute & product-related associations that were linked to the product & reinforced its quirky positioning Enlisted the support of offbeat personalities, including Howard and Rush to create an individualist image that helped achieve cult status Reinforcement of Snapples brand image and brands mantra: 100% Natural can be seen through the use of natural and real set up .
The small distributors weresmall as individuals but became a mighty marketing force when aggregated Aggressive distribution was a mainstay in Snapples success
These distributors generate high margins carrying Snapple, they also had the option of delivering other beverages to chain stores further boosting profitability
Snapple also undertook the opportunity to increase its distributio volume significantly by investing incoolers and vending machines for convenience stores
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Internal Factors
Extrenal Factors
Snapples rumors had an impact on brand image, consumers brand loyalty and brand equity.
The failure of large pack of Snapple drinks illustrated Quakers low understanding and lack of consumers and distributors communication. The main weakness of Quaker was the failure of Snapples brand consistency and the transformation of its brand. The lack of understanding of brand also led to wrong implementation of marketing tactic
Due to the success of Snapple, increase in competition was seen and consumers became more price conscious. Consumers will switch for the lower price product when there is no large differentiation between the products
The youth market, with a lower disposable income, may thus be lost.
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CONFIDENTIAL DO NOT DISTRIBUTE In the period 1972 to 1993, why do you think that Snapple flourished when so many small startup premium fruit drinks stayed small or disappeared? Explore each of the Four Ps, to decide where to give credit
Personnel
Channel
Image
Wendy Kaufman was a spokesperson, who was seen as quirky, likable, and honest Enlisted the support of offbeat personalities, including Howard and Rush to create an individualist image that helped achieve cult status Reinforcement of Snapples brand image and brands mantra: 100% Natural can be seen through the use of natural and real set up
Indirect channel distribution marketing strategy was exploited Snapple was sold primarily though cold channels such as street vendors, delicatessens, restaurants, and recreations areas It had a very little supermarket coverage The small distributors were small individually but became a mighty marketing force when aggregated Aggressive distribution was a mainstay in Snapples success These distributors generate high margins carrying Snapple, they also had the option of delivering other beverages to chain stores, further boosting profitability
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Snapple was very successful in conveying its identity as a sort of counter culture and nonmainstream beverage It was perceived as honest, Was consideres100% natural, Had a somewhat edgy, independent image And was considered not to be a part of corporate America
Did Quaker (the 1994-1997 phase) make an error in buying Snapple or did they just manage it badly? Briefly support your answer
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Identify the three highest priority initiatives you would start tomorrow if you were in Mike Weinsteins shoes. Justify them
Personnel
Channel
Image
Put in place an extensive and dependable network of independent distributors as was the case before Offer new short term lucrative incentives so as to empanel them again . Possible expansion of the independent distributors so as to penetrate the market even further.
Re-enlist the support of offbeat personalities, including Howard and Rush to recreate the individualist image that helped achieve cult status Reinforce Snapples brand image and brands mantra through marketing
Understand the product differentiation of Snapple from its own product and its competitors and employ strategies to heavily market the brand values of Snapple. The marketing strategy should always focus on its core brand value. Both qualitative and quantitative consumer researches, and brand tracking should be engaged to enhance the understandingof their product and consumers requirements
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Roll forward to 1998. What can Triarcs managers learn from Quakers experience? What can they apply from their own experience? Is the Snapple target market anyone with lips? Is it OK that Snapple ends up meaning lots of different things to lots of people? What are the risks and rewards of leaving what the brand stands for open to consumers interpretations rather than a strong positioning on it? And what does it mean to say that Snapple is a fashion brand?
No,
strong positioning helps the brand segment and target the market accordingly.
strategies in distribution and promotion pertaining to the positioning can be adopted. of the positioning to the consumer can lead to confusion amongst potential users also.
Specific
Interpretation From 1.
Eliminate Unsuccessful Flavors Vintage Line Change Packaging Recyclable Material (Green Movement) Pull Strategy -establish on the East Coast Consumer Contest Bring back Wendy personality
2. 3. 4. 5.
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Thank You