Go Girl Energy Drink New Product Introduction - Fall, 2014 - S.I. Newhouse

Go Girl Energy Drink New Product Introduction Jennifer Cornwell Fall, 2014

The Energy Drink Market Energy drinks are not a product that consumers necessarily need, so the sales of energy drinks can easily fluctuate. Over the past five years, the market has seen some growth, despite some ups and downs within the marketplace. As the economy overall continues to turn itself around, consumer’s ability to spend money on non-necessities, like energy drinks or other similar food products, will grow. Many of the sales of energy drinks have come from this increase in disposable income as well as the purchases made by young adults and teenagers, who have continued to grow as a consumer base for energy drinks. The growth of the industry can partially be attributed to two major consumer groups, millennials and Hispanics. Energy drink companies have also found that their consumer bases are very brand loyal, which is a huge benefit for individual brands.

Millennials are an ever popular consumer target in the energy drink industry. Males within the target are generally considered heavy users. However, within the millennial age group are young female professionals and young moms. It turns out that this segment within the millennial market are actually just as likely, possibly more likely, to drink energy drinks. This niche has not yet been met with either an energy drink product or promotions of current products successfully marketed to this group.

Currently, the energy drink market is saturated with brands doing very similar things. Energy drinks have taken on many forms, from the ever popular soda-like can, to multiple flavors, energy shots, hybrid energy drink-soda style beverages and powders. Many of the popular brands have taken steps into the different forms, both new and old. The major market share is controlled by Red Bull, then Monster Beverage and followed by Living Essentials LLC, the makers of 5-hour energy shot. However, all of these brands and Go Girl are affected by similar external factors: •

Disposable Income – People obviously don’t need energy drinks, which means that customer’s willingness to spend money on energy drink directly links to people’s available disposable income. Disposable income is expected to increase in the next year, hopefully driving the sales of energy drinks.

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Convenience Stores – Energy drinks are sold in many locations, however most sales, 59%, are made within convenience stores. Convenience stores are another outlet that will benefit from an increase in disposable income. Once consumers begin shopping within these locations for similar food products, snacks, candy, sodas, etc., energy drinks may see more demand from within this retail setting.

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The Health Kick – America’s health consciousness could be considered a trend, but it doesn’t seem to be fading anytime soon. In which case, it is directly affecting energy drink sales. Energy drinks have received a lot of backlash as to whether or not they’re actually good for you. In comparison to its natural competition, coffee, energy drinks really have to prove themselves. As American consumers become more healthconscious, their need for or interest in energy drinks will become less and less, in turn causing a decline in the industry revenue.

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Grocery Stores and Supermarkets – Although a majority of sales do not occur within grocery stores, they are still an option for sales. So if demand from within grocery stores were to increase, there could be a spike in industry performance. However, in actuality, sales within grocery stores are expected to decline within the next year or so.

Trends Soda and Coffee - It’s so important for energy drinks to take into consideration that there is competition outside of the energy drink market. Beyond the factors above that must be considered, soda and coffee must also be brought into the larger picture. Soda has very similar qualities to energy drinks with a lower caffeine intake per can. However, soda consumption must also overcome the health kick in America and it’s not expected to. While soda can be considered ‘better’ for you in comparison to energy drinks, in the eyes of the American consumer, it’s not that much better. Coffee however is considered better. Coffee is the energy drink’s biggest competition. It’s natural, easily available, comes in many forms and has gained and will continue to gain popularity overall. Some of the competitors listed above have responded to this by creating coffee-energy drink hybrids. Associating coffee with energy drinks could potentially reach those avid coffee drinkers.

All-natural energy –There have been studies and controversy surrounding whether or not energy drinks are okay for someone to drink regularly. They are made up of a lot of artificial ingredients and caffeine, and consumers know that. Their opinions as to whether or not they will purchase or even consume energy drinks, have been formed and may be difficult to sway. Producers have begun to develop allnatural, healthier products. Jamba Juice has introduced a line of all-natural energy drinks and Yerba Mate has an organic energy shot. These more natural products will continue to grow in popularity and we will continue to see more of them as American’s health concerns continue to increase.

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New Products – Energy drink producers will continue to introduce new products, which have led to most of the past industry growth. Rapidly producing new products peaks consumer interest and will continue to grow the industry as it has in the past. Traditional energy drinks, bought in a can similar to soda, are still the most popular and account for a majority of drink sales. However, if producers can create a form that is healthier and more convenient, they could see consistent growth within the market.

Health Concerns –Regardless of whether or not energy drinks are considered safe or healthy, most consumers continue to buy energy drinks. In stores, energy drinks are conveniently located and conveniently priced. While the industry will need to make a conscious effort towards more natural energy products in order to continue to grow their consumer base, it turns out that consumers are still interested in the energy drinks already on the market. Another health concern outside of the product make up is its use. Particularly heavy users have been reported to have had some major health problems linked to energy drink consumption. Energy drinks also appeal to millennials as a drink mixer, meaning they mix some energy drink product with alcohol. Mixing caffeine with alcohol, a depressant, can come with huge health risks and could continue to shed a poor light on the energy drink market, making it more difficult to grow the marketplace.

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Competition Market Share -

Red Bull 32.9%

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Monster Beverage Corp. 28.7%

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Living Essentials LLS (5 Hour Energy Shot) 12.7 %

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Rockstar Energy Drink 7.3%

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The Coca-Cola Company 6.0%

The major brands listed above make up almost 90% of the entire energy drink market, making it very difficult for smaller brands, who hold about 12% of the market share as a group, to break into that marketplace. Aggressive marketing and promotion have been huge contributors to the success of the major brands like Red Bull or Monster. The position within the marketplace of these two brands has hardly been swayed, even by a major company like Coca-Cola. However, competition overall is still very high. Although, smaller name products may struggle to enter the marketplace competitively, it’s important that their products stand out from the competition to be competitive. This is one of the only ways that smaller companies will be able to differentiate themselves from brands like Red Bull.

It’s important to remember that competition exists outside of the marketplace brands, coffee being the final major competitor. Coffee production has grown significantly and will continue to grow at an exponential rate. The availability of coffee in general and all of the products created with coffee will play a huge role in the success of energy drinks. If one is more readily available, more user friendly or simply tastes better than the other it’s much more likely to succeed over all as consumers have become less concerned about the brand of their drink.

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Red Bull – Market Share 32.9% Red Bull is one of the strongest, most aggressive brands in the world, let alone within the energy drink market. The brand was founded in Austria in 1984 and as of 2013, they’ve sold 5.4 billion cans of energy drinks globally. Red Bull is an example of a brand that is doing lots of things right.

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Product – Red Bull has developed a multitude of products but currently in the United States they only sell a variety of canned energy drinks. These include their original energy drink, a sugar free version, a zero calorie version and the editions series. The editions series are Red Bull’s ‘limited edition’ flavors, including cranberry, lime and blueberry. Red Bull also produces a cola that is not an energy drink, but is still packaged in the same fashion as their energy drinks.

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Pricing – Red Bull is reasonably priced at about $3 a can however, in comparison to other energy drinks it is one of the most expensive. All of the flavors are sold at the same price. You can also buy them in 4 packs, 12 packs and 24 packs. Generally, in grocery stores they carry single cans, either in the soda aisle or the refrigerators at the ends of check-out lanes. 4 packs and 12 packs can be purchased in the soda aisles as well.

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Distribution - Currently Red Bull is in at least 166 countries. In the United States, Red Bull is sold in chain grocery stores, convenience stores, sometimes vending machines and other quick grab and go food retail locations.

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Promotional History - The interesting thing about Red Bull is how historical their promotion has been. Red Bull partners with sporting events, particularly extreme sporting events. From dirt bikes to skate boards to surf boards, Red Bull sponsors, highlights and plans events to work for the athletes as well as for the Red Bull Brand.

Red Bull relies so much on their event promotion, even from the very beginning with the first ever Flugtag. Held in Vienna, Austria in 1991, the Flugtag event has become extremely well known and was one of Red Bull’s first ever promotions. Red Bull also pulls stunts on college campuses, like temporary vending machines that provide free Red Bull or distributing cans on campus during finals weeks. Red Bull is very promotion heavy and works it to their advantage.

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Monster Beverage Corp. – Market Share 28.7% Monster Energy is the second leading energy drink in the current marketplace. Founded in 1935 in California, Monster reported global revenue of $2.7 billion last year, a number that has only continued to increase each year. Even with the backlash regarding the health effects of an energy drink, Monster has seen little to no fluctuation in sales.

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Product – Monster Beverage Corp. distributes at least 20 products, all energy drink based. Their original canned energy drink ‘line’ includes 13 of these products. They have also extended into coffee by creating a canned energy drink that is ‘coffee + energy’ and called the ‘Java Monster.’ Monster also creates high potency, extra strength energy drinks. The multitude of products are divided into separate categories and it seems that each category attempts to fill a particular niche of the market.

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Price - Monster is sold in 16 oz. cans that are priced between $2 and $3. Commonly, grocery stores or convenience stores carry a variety of the Monster beverages. Monster can also be purchased in 4 pack boxes, typically sold in the soda aisle. The 4 packs are sold alongside individual cans and the individual cans are also sold in the refrigerators at the ends of check-out lanes.

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Distribution – Convenience stores rack up the most sales for any energy drink company and Monster is no exception. The beverage can be bought in convenience stores, grocery stores and in other grab and go food sale locations.

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Promotional History – Monster, much like Red Bull, partners with extreme athletes.

Their website provides a roster of athletes, personalities, musicians and more that have partnered with the brand. Monster also promotes via extreme sporting events, including the X Games. They are currently running a contest for the ‘Ultimate Monster Energy X Games Fan Experience.’ The sports they affiliate with are generally racing based, opposed to Red Bull’s broad spectrum of extreme sports. Monster’s logo is made into a sticker that can be put on a racer’s bike or car. However, the Monster logo has become increasingly popular among ‘regular people’ who may just have an interest in some form of racing. Their logo has been plastered on the back of pick-up trucks and cars, only to create more promotion for themselves.

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Go Girl Go Girl is an energy drink produced out of Sacramento, California beginning in 2005. The drink is owned and produced by Nor-Cal Beverage Company, a family owned company established in 1937. Currently, they distribute only to the West Coast only, including the states of Washington, Oregon, California and Nevada. Go Girls comes in five different flavors, Original, Sweetie Grapefruit, Peach Tea, Pomberry Tea and Lemonade. It sells competitively for about $2 or $3 a can. The best-selling flavor, Original, is five calories, sugar free, lightly carbonated and low-carb. Each flavor also contains an appetite suppressant, garcinia cambogia a ‘trendy’ way to lose weight that was covered on the show ‘Dr.Oz.’ Currently, Go Girl is marketed to young, college age females via promotional events. These have included involving sororities and involving Go Girl’s breast cancer fundraising. Go Girl proudly supports ‘breast and ovarian cancer research and awareness’ as stated on their website and on each of their cans.

“A portion of the proceeds of each case sold is donated to affiliated foundations. Go Girl has created relationships with foundations like: Albie Aware, The Network of Strength, Susan G. Komen, Cure Breast Cancer Inc. & the National Ovarian Cancer Coalition.”

Go Girl strongly believes in promoting and raising funds for these breast cancer affiliated charities in hopes that their consumers will find a connection as well. Go Girl is made for women, for the girl on the go. Go Girl hopes to extend themselves into a nation-wide marketplace and beat out the competition for women energy drinkers.

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The Taste Test 19 participants, 16 of them female, between the ages of 18 and 24 tried Go Girl Original flavor, and filled out a survey asking them about their caffeine preferences and habits. Based on the survey: •

16 said they will drink a beverage specifically because it has caffeine in it

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10 said they regularly drink caffeine, all of these respondents said they consume caffeine at least once a day

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13 respondents said when they drink a caffeinated beverage, coffee is their first choice.

Brands listed were Starbucks and Dunkin Donuts. 3 of the thirteen respondents also said they drink tea

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3 participants listed ‘energy drinks’ as a caffeinated beverage they sometimes drink. 2 of those respondents were female who both also listed coffee as a source of caffeine.

Energy drink brands listed include Red Bull, Monster and Mountain Dew

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8 respondents said they either cared ‘somewhat’ or ‘a lot’ about how many calories were in the beverages they regularly drink. All respondents were female

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10 respondents said they will specifically select a product because it’s a low calorie product

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13 respondents said they would make a conscious effort to choose a product because it’s cause related

In the taste test, the drinks received mixed results. Some statements include: "I like the Original one better than the tea one."

"The tea one is too sweet."

"Wow that is pink!"

"Tastes like a fruit roll up but fizzy."

"It has appetite suppressant in it? My mind is changing.."

"I think it’s very gender specific..."

"I feel like fake cherry flavor never actually works."

"It's a little too sweet." (Original) "I feel like there's so many cause driven products that I've started to filter that out when I'm at the store."

"It says ‘save lives’, but it's completely filled with chemicals. I know they might not be connected but it's weird that they're promoting health."

"I just get three shots of espresso from Starbucks, it's more natural."

"It does taste better than Monster."

"I'm not a big energy drink person, but it wasn't bad."

"It's so good! It tastes like soda." (Original)

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Summary: Female’s 18 – 24 do drink caffeinated beverages and that need is currently being filled by coffee. They aren’t as concerned with calorie count and they’re more concerned with whether or not what they’re drinking is considered healthy. Flavor is a big factor and not as much of a problem with Go Girl. They may also be concerned with whether or not their product is cause-driven and it does have an effect on what products they’re buying.

SWOT Analysis Strengths -

Weaknesses

Variety of flavors Low calorie, Low Carb, Low sugar Cause driven brand Taste Large social media following Appetite suppressant Offers carbonated and noncarbonated versions Large region for distribution More ‘grab & go’ friendly than coffee

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Opportunities Can reach a target audience that has not yet been promoted to – 22-28 y/o females are drinking energy drink but have yet to be a target audience for a successful campaign Be the pro-female brand Become the coffee replacement for the busy woman Become the grocery store energy drink, rather than the quick pick convenience store

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Targeting an already saturated market Smaller budget compared to major energy drink companies i.e. Red Bull Possibly too many products/flavors Large region for distribution, but a small customer base that cannot support it Targeted to females, but most energy drink sales are made within convenience stores, rather than grocery stores where target market may actually be shopping Not as readily available as coffee Cannot come in as many forms as coffee Threats Coffee, Tea Possible health risks affiliated with energy drinks All-natural energy drinks entering the market Large energy drink brands like Red Bull or Monster Inability to take control over the small brand portion of the energy drink market

Introductory Plan Positioning Go Girl energy drinks are made for the woman that works 8-6. It’s made for the woman who wakes her kids up in the morning and puts them to bed at night. Go Girl energy drinkers are achievers who do their job and everyone else’s.

There is a new generation of Go Girls who take their time seriously and strive to be better than they already are. That means putting in the extra hours to come out on top. Whether those extra hours are put in to being the best employee or being the best mom they can be, Go Girls need an extra boost to not only keep doing what they’re doing, but to come out on top. Go Girl energy can provide them with the extra oomph they need to go the extra mile and be better than their very best.

Product The Go Girl energy drink offers a variety of flavors that allow for them to appeal to a variety of people.

Energy drinks that taste alright are hard to come by, but Go Girl has managed to make one that actually tastes good. However, I don’t believe the packaging is doing anything for the product. I’m not opposed to keeping the name Go Girl. It is very gender specific but I believe that using the name to market the product could be beneficial enough to argue that it’s worth keeping. The can itself however truly needs an update. Besides the fact that it’s slightly dated, it’s also very busy with text and image and logos. I think that cleaning it up will prove a significant difference in the brand’s image. I believe this product could provide for the young professionals that are not currently targeted in the energy drink market, however they are drinking energy drinks. By ‘cleaning up the can’ by getting rid of some of the imagery and texture, and making it sleeker-looking, you help provide an image that your customer wants to associate with.

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Current Can Design

Updated Can Design

The ‘Updated Can Design’ has very subtle, minor changes. There are fewer words, but the same message is being projected. Muting the neon pink makes the can less overwhelming and more appealing. I believe our new market of ‘Go Girls’ will be more likely to carry around this can.

The drink itself tastes pretty good and the variety of flavors allow for it to appeal to a broader range of people. During the telephone conversation with Go Girl marketing, they discussed getting rid the Pomberry Tea flavor and the Lemonade flavor. Although the research groups were not able to try the lemonade, after personally trying the lemonade flavor getting rid of the product may be for the best. On the other hand, the Pomberry Tea was tasted and had very similar feedback to the original flavor. The Pomberry Tea has some benefits that should be taken into consideration before being completely thrown away. Having tea in the name of a flavor instantly makes it sound more natural, regardless of whether or not it is actually better. This could be helpful in overcoming the ‘health kick’ obstacle.

Marketing both the Pomberry and Peach teas as teas with extra kick could be highly beneficial.

The only other consideration from the research to consider in the product is whether or not the product needs to contain an appetite suppressant. There’s a major difference between choosing a product because it’s fewer calories in their diet or because it will make them eat less. Go Girl doesn’t need to be the next new diet energy drink, Go Girl should instead focus on providing a positive image that women aspire to be a part of. Keeping women’s body image issue in mind but out of the product could benefit Go Girl overall.

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Pricing Go Girl’s current pricing is competitive enough to keep up sales and stay competitive within a larger market. Go Girl should be sold in 6 pack boxes as well as single cans in grocery stores, much like Red Bull and Monster each do. The 6 packs would allow for a higher volume of sales by selling more cans at once and it would mean that each customer would have enough cans to last them a week before they go back to the store for their next grocery trip.

Distribution After the positioning, in this situation, distribution is the next most important factor in the product introduction. Grocery stores should be the number one location for Go Girl sales. Although most energy drink sales are not coming from within grocery stores, and they are expected to decline, convenience stores are not where women are doing the same kind of shopping. Women in the target demographic are in grocery stores buying weekly products for themselves or their families. When she enters the store with her shopping list, it should say that she needs ‘Go Girl.’ Using end cap displays and stocking refrigerated cans by the registers are important in-store placement factors.

Go Girl should try to make itself as readily available as coffee. Although coffee comes in many different forms a chilled Go Girl should be coffee’s indoor substitute. In which case, Go Girl should be distributed to office complexes. Although vending machines seem convenient and optimal, marketing Go Girl to office managers and giving them a free case to try so they can buy it by the case and keep it cold in the office refrigerator makes it much more convenient. Similar to free samples, employees can try Go Girl at work and buy it when they’re in the store on their own.

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Creative Brief Objective: To prove to women that drinking Go Girl is going to help them do even more than their best.

Target Audience: Women, ages 22-28 who are goal oriented -

Rachel is 24 and graduated college two years ago Summa Cum Laude with a marketing degree. She received a job offer in June right after graduation and has been working at the company for the past two years. Rachel has been promoted twice since being hired and the top executives within the company in New York know who she is. Rachel wakes up early every morning to go to the gym before she clocks in at work at 8 AM. She generally works through lunch and leaves between 5:30 and 6:00 PM. She starts every morning with a cup of coffee on her way to the gym but by the time 3PM rolls around, she finds that she has lost focus and usually heads to the break room for another cup of coffee. Rachel has gone to extreme measure to keep herself awake during afternoon meetings at work. By the time she gets back to her apartment she has just enough energy to make dinner before falling asleep on the couch. She would like to volunteer with her niece’s soccer team and has slept through several texts from her friends trying to make plans, but after work she is usually in bed by 8 PM and just can’t seem to stay awake any longer. She’s tired of being tired.

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April is 27 years old and has a 3 year old child, Johnny, with her husband of 3 years. Her husband is a lawyer that works long hours and April has been working as an architect for the same firm since her internship in college five years ago. April has worked her way up to the top with hard work and dedication and a position for partner could be in her near future.

Although it’s just rumors now, April believes that she has a good shot at the position.

However, April finds that as the years have passed and as Johnny gets older, she has less and less energy. She doesn’t want to admit that it’s because she’s getting older because she doesn’t feel old yet. And she still has all the motivation and ambition to work hard, but she just doesn’t have the energy. She occasionally drinks a cup of coffee if Johnny hasn’t slept well the night before, but she has no real caffeine routine.

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What do they believe?

Energy drinks are aggressive brands and are made for truckers and teen gamers.

What should they believe?

Energy drinks don’t have to be overly aggressive. Go Girl can provide you with the quick pick me up in the morning or afternoon to make sure you’re the best version of yourself.

Single minded proposition Go Girl will help the modern day woman go the extra mile, plus another lap.

Reason to Believe Go Girl is an energy drink made with a variety of B-vitamins and Taurine, commonly found in energy drinks and supplements. However, the Go Girl drink delivers these energy providing ingredients in a way that taste’s good and is easy for women to get the extra boost of energy they want.

Executional Mandatories: Recognize that women are already working hard and Go Girl isn’t a substitute for hard work but is instead a helping hand to the next best thing in her life.

________________ Media Recommendations: • • • •

Print Ads Social Media Outdoor Ads (Subway, Bus Stop) In-Store Advertisement

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Print

Could also be used for Subway/Bus Stop Ads 15

Social Media The Go Girl brand already has a large social media following to take advantage of. To continue to project the Go Girl image in social media it’s necessary to get Go Girl drinks into the hands of that type of women.

Spokespeople: Mommy blogger and Youtube personality: Marie Bits and Clips More and more, women are turning to social media to read reviews and find product recommendations via their friends and other trusted sources. Marie Bits and Clips is a stay at home mom of two children under 6. She has over 72,000 subscribers, 700+ readers of her blog, and 3,000 likes on facebook.

A partnership with Marie, and other women like her would mean putting Go Girl in the hands of women who do it all and getting some product placement via social medias.

Marie in particular is an excellent choice, as she is based out of Seattle, Washington, putting her in the right region to bring Go Girl out of Sacramento.

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Events Go Girl already does a lot of promotion via events and it’s important to continue that promotion.

By continuing these partnerships with cause related events, Go Girl continues to grow their image as a brand specifically for women. Taking part in walks across the country will also help with brand awareness and distribution. Getting women at these events to try free samples will give them a taste of it and get them talking about the product. Go Girl also has some opportunities to team up with foundations like Susan G. Komen to produce some partnered, breast cancer centric swag. The proceeds from things like t-shirts, tote bags and travel mugs could also be donated to the foundation, another positive factor for Go Girl’s image.

Go Girl could set up a branded tent at an event to hand out samples, sell cans and sell merchandise.

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In-Store Display Go Girl has to be prominently displayed on the end caps of an aisle. Although these location are expensive, in order to sell the product within grocery stores, the in-store advertising has to be aggressive.

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Samples/Demos- Getting a woman from Go Girl to come in and hand out samples along with a coupon will help drive sales and give women the opportunity to try Go Girl. Coupons drive sales for women 22-28. They are more willing to try new food products with a coupon so I believe their first can should be half price. If the can is on sale for $2, the coupon should be $1 off. It’s also important that the demo includes the original flavor as well as a non-carbonated. In a faceto-face situation, it’s easy for a Go Girl representative to tell a customer that they are one of the few energy drinks that have non-carbonated options.

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Displays- A giant can of Go Girl can easily be designed to look like a big fuel tank. Along the side there should be a ‘fuel gauge’ that reads full. The gauge could include markers that run up it starting with ‘Entry level’ at the ¼ tank mark. ½ tank marker could be labeled ‘strategist.’ At ¾ tank, it could read ‘project manager’ and at the full marker it could read ‘CEO.’ I think this strategy would be eye catching and continue the print ads in a new way in-store.

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Conclusion Currently, the energy market does not provide an energy drink specifically for females. They focus more generally on students or teens, but no one has developed a marketing strategy targeting females. There is research that has found that one of the largest groups of energy drinkers are young moms. Even with this insight and the research that supports it, major producers like Red Bull, Monster or Rock Star have yet to bring forth a female specific marketing strategy.

This is Go Girl’s opportunity. By targeting women 22-28 years of age, you are targeting women at a very particular part of their lives. This time of a woman’s life can include the beginnings of careers, families, new degrees. It’s a time when women are competing to get ahead in their careers or with their families.

Either woman has a lot on her plate and is trying to do everything to the best of her abilities. Go Girl can position themselves as the extra fuel to get these goal-oriented achievers beyond their very best.

By discontinuing the heavy focus on being sugar free and weight loss friendly, I believe Go Girl can be more female body-positive, and simultaneously become more about female empowerment. There are too many diet, low-cal, low-sugar drinks in the marketplace for Go Girl to stand out in that way. Instead of continuing to worry women with their size and body image, Go Girl can support women’s ambitions and goals.

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Sources Simmons: Who is drinking energy drinks?; What bands are they drinking?; Shopping habits of Females 18-34; Media Habits of Females 18-34 “Energy Drink Production in the US” April,2014. IBISWorld.com “Energy Drinks” August, 2014. Mintel Reports Gogirlenergy.com Redbull.com Monsterenergy.com

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