LaCroix Sparkling Water Marketing Plan
SPRING 2013 Maria Daniela Carrera
SITUATION ANALYSIS
CURRENT MARKET LaCroix is a sparkling water that has been in the market for over 30 years. Through Spectra we were able to identify its current heavy consumers as well as its core consumers. After analyzing Image 1.1, we were able to pinpoint three different current market segments of heavy consumers for LaCroix. Households with children in affluent suburban spreads and comfortable country showed high indices, this was the first target we identified. The second target segment were couples 35+ with no children in the household, in the same lifestyle segments as the families. Because both of these clusters are geographically located in the same area; affluent suburban spreads indexing a total of 160. This means people in this lifestyle segments are 60% more likely to consume LaCroix. The comfortable country segment indexing a total of 122 means that people in this lifestyle segment are 22% more likely to consume LaCroix. Image 1.2 describes the segments with the highest percentage of dollars spent on LaCroix. This chart, taken from spectra fast facts, allows us to know whom our core costumers are. The ones were the bulk of our sales come from. In this case it mirrors the Index graph Image 1.1 incredibly accurately. By understanding this, we can agree that our core customers are the same as our heavy users. It allows us to be more confident when stating that affluent suburban spreads with 28.3% of our total sales and comfortable country with 21.0% of our total sales are our core costumers. Almost 50% of our total dollars come from these two lifestyle segments.
CURRENT MARKET DEMOGRAPHICS Demographic Summary: Female, white, married, no children, married family without kids, 2-person household, household income 150,000 +, age 45-54, college graduate, professional & specialty, affluent Minipolitan sprawl, 2 vehicles, South Atlantic.
Meet Caroline, she is a fitness conscious woman. Caroline turned 50years old
last month and went on a trip to Europe to celebrate with her husband! What she likes to do most when traveling is walking around the cities, she tries to disconnect from work while on vacation because as much as she enjoys being a lawyer, her work can be very stressful. Caroline uses exercise and a healthy diet to stay focused at work and feel great! Caroline got married a year after her college graduation. Her and her husband decided not to have children; she lives in a nice home in a Minipolitan sprawl outside of Orlando, FL. Both her and her husband have their own vehicles but her office is so close that sometimes she prefers to walk 20 min instead of driving. When it comes to her social life, Caroline enjoys going to Yoga class and Pilates with her girlfriends. She also enjoys spending time with her husband at home.
Demographics-
Race-of-Head-of-Household-
La-Croix-R-(Carb-Bev-:-SD8Carb)Pints-**Total-$-per%-Total%-HHs100-HHs$Index!! !! !!
!!!!!White! Number-of-Persons-
70.9%! !!
!!!!!2!Persons! Household-Income-
32.4%! !!
!!!!!$150,000!or!More! Age-of-Head-of-Household-
Caroline was raised Christian, although she doesn’t follow the religion strictly, she is very spiritual. She likes to help those in need whenever she is able to. Caroline enjoys La Croix water daily because it allows her to stay healthy!
Spectra-Lifestyle-
Top demographic attributes For La Croix Water HH Income Education of head of household Occupation of head of household Age of head of household Housing tenure
Household-Composition-
!!!!!South!Atlantic!
!
65.4%! 33.3%!
37.8%!
114! !!
56.8%! !!
20.0%!
129!!
!!
!!
212!!
!! 29.1%!
!!!!!2!Vehicles! Census-Division-
28.0%!
50.7%!
!!
90! !!
!!
!!
!!!!!Married!Family!without!kids! Number-of-Vehicles-in-Household-
57.4%!
13.2%!
!!!!!Married!
186!!
!!
!!
167!!
9.8%!
63.8%!
!!!!!Prof!&!Specialty! Marital-Status-of-Head-of-Household-
29.7%!
!!
!!
127!!
!! 5.3%!
!!!!!No!Children! Occupation!of!Head!of!Household!
84.1%!
17.8%!
!!
90! !!
!!
!!
!!!!!Affluent!Minipolitan!Sprawl! Age-of-Oldest-Child-
57.1%!
66.4%!
!!!!!College!Graduate!
135!!
!!
!!
334!!
28.5%!
63.8%!
!!!!!Own! Education-of-Head-of-Household-
23.1%!
!!
!!
111! !!
!! 21.2%!
!!!!!No!Children! Housing-Tenure-
36.1%!
6.9%!
!!
106! !!
!!
!!
!!!!!Age!45!<!54! Age-and-Presence-of-Children-
75.1%! !!
150!!
33.3%!
166-
Image 2.1
TARGET NEEDS & WANTS SOCIOLOGICAL NEEDS
A sociological need for the American consumer is the need to drink carbonated beverages; the demand to use carbonation to make the drink more refreshing has been fulfilled also by drinking beer and soda.
PHYSICAL NEEDS
On Maslow’s hierarchy of needs water is at the bottom of the pyramid, we need it to survive. Still water is available through our pipe system in the United States to the average American citizen. The Physiological need for water is met. Keeping this in mind sparkling water climbs the pyramid and is seen as a product that creates fulfillment, you must purchase it at the store or restaurant and it is part of self-actualization. People consume it because they enjoy it, but they do not need it.
PSYCHOLOGICAL NEEDS
Status. Drinking sparkling water is correlated to being of a higher socio economic status. Sparkling water tends to be more expensive than still bottled water. Not to say that sparkling water must always be purchased, instead still water can just be served from the faucet. In high-end restaurants sparkling water is always an option, this allows society to correlate this beverage for the elite. Another factor that has labeled this water of high status is that the highest percentage of market share comes from two European brands; One French PERRIER, and the other Italian, S. Pellegrino. The American public values highly products from these two nations classifying them as classic, elegant and elite.
UNDERSERVED SEGMENTS
LaCroix heavy consumer by index vs. category Sparkling waters can be found under the carbonated beverage category, within the regular or diet subcategories. For this study and because I found that LaCroix’s main compeRtors were other sparkling waters and diet beverages I choose to compare LaCroix to the low calorie sub-‐category. When looking at heavy consumers by index Image 3.1, Total Low Calorie carbonated beverage index high across all lifestyles segments within the Established couples and Empty nest couples. Indexing parRcularly high in affluent suburban spreads (Index151), comfortable country (index154) and plain rural living (index158). When comparing these to the heavy consumers of LaCroix Image 3.2, we can see that the highest lifestyle segments are the same, but that LaCroix index numbers are much higher than the category, for example: LaCroix highest total lifestyle index is 160 in affluent suburban spreads, compared to carbonated diet category’s highest lifestyle index 111 in comfortable country, followed very closely to by affluent suburban spreads with 110. We are also able to say that we have captured the families within these lifestyle segments, whereas the category doesn’t show heavy consumpRon with families. There are some cells that index 125 -‐131 but they do not make up a cluster, making it impossible to define them as heavy consumers.
Image 3.1
Image 3.2
CORE CONSUMER SEGMENTS
LaCroix core consumer by percentage sales vs. category As we compare Core Consumer on the charts to the left, LaCroix vs. the category, we can see that the percentages of sales are very similar in the behavioral stage totals. Couples with no children in the household 35+ make up 37.6% of total LaCroix sales, compared to 42.2% for the category. The biggest difference I saw when comparing LaCroix core consumers to the category was within the plain rural living segment. They have the highest percentage of sales with 22.6% whereas LaCroix only has 14.6%. Instead Affluent suburban spreads make up 28.3% of total La Croix sales compared to 19.4% for the category. After reviewing and comparing the heavy and core consumers of the category vs. LaCroix, we are able to define potential targets based on opportunities we see within our current customer which we must foster, that still have a potential for growth and our non-costumer segments which we must cultivate and develop, these are segments in which we see new opportunities for growth. After analyzing LaCroix consumers vs. category consumers we can define current costumer segments that may grow if fostered: As far as potential targets, we see that plain rural living and modest working towns account for 40.5% of total diet carbonated category sales, LaCroix total dollars from these two lifestyles is 29%. With these numbers we can conclude that there is an opportunity for growth. We know these segments are already consuming our product but that there is still an 11% sales difference between LaCroix and the category, therefore if targeted in the future it could result in potential growth. Another segment we could possibly target are couples with no children in the household. They account for 42.2% of total diet category sales, 4.6% more, than LaCroix with 37.6%. This means that there is an opportunity for sales growth in these segments as well.
Image 4.1
Image 4.2
PRODUCT DIAGNOSTICS
LaCroix vs. Category
Image 5.1
Another insightful way of understanding LaCroix vs. the category is by the Product Diagnostic chart found on spectra Image 5.1 here LaCroix is automatically compared telling us that by Total Consumption, the brand is at 20.52, whereas the category is 17367.64, this tells us that there is very low consumption compared to the whole category. We must remember that this category includes heavy competitors such as diet Coca-Cola and diet Pepsi, although these are competitors, they are not the ones we are looking to target specifically, later we will look into the sparkling water category and understand LaCroix’s ranking within it. Another measure we are able to compare our brand to is by Penetration, in other words, the number of adults who have tried the product at least once. LaCroix’s penetration is .56% compared to 87.20% for the category. This is a very important comparison because we can say that there is a lack of trial with our brand compared to the category. Although this is a very low number for LaCroix it indicates opportunity for future campaigns to encourage first time trial. Lastly, this chart informs us about Buying Rate, this is very important information because it allows us to identify the number of items purchased in the year 2012 per buyer. LaCroix with 36.89 has a much lower buying rate than the category at 199.18. This presents us with another marketing challenge that we must address.
MARKET SHARE Image 5.2 allows us to find competitors by market share within the sparkling water category. Although LaCroix is listed within the entire carbonated beverage category, we felt that although it gave us insight into consumption, buying rate and penetration we needed to look further and find market share for sparkling waters alone in order to determine top competitors. This chart from InBev.com, a trade magazine, gives us insightful information about top competitors through total dollars. This is incredibly helpful when trying to compare LaCroix to its subcategory, sparkling water. We see that from 2012 data, LaCroix ranked 5th in market share with 8.9% after private label 21.0, Perrier 18.1%, San Pellegrino 15.6% and Sparkling Ice 9.6% this will help us narrow down our main competitors.
Image 5.2
NEW TARGET MARKET In order to determine new targets markets we needed to look into many different factors, the first is the importance in demographic attributes for consumers of LaCroix. The Image 7.1 tells us that household income is the most important attribute, so when we look back at our current target research we know that our core customer HH income is $150,000+. This concludes that LaCroix is more likely to be consumed by the three highest income lifestyle brackets. There are two category markets we must look to target.
Image 7.1
CULTIVATE & DEVELOP – markets where we see opportunity for growth Cosmopolitan Centers are currently indexing total 97, with 13.1% of our total dollars. We see a huge amount of potential by targeting cosmopolitan centers because they have higher incomes and as discussed earlier that is the #1 demo attribute that dictates our consumers. We also believe that since we already have high consumption with families with or without kids in the other two high-income lifestyles (affluent suburban spreads and comfortable country), we should be able to attract the same behavioral stages in the cosmopolitan areas. Young Transitionals & Independent singles in Cosmopolitan areas, Affluent Suburban spreads and comfortable country. We see these two segments as a great opportunity to create future loyalist. This will be the most challenging demographic to capture because at the moment we do not rank high in the market. What allows us to be able to target these segments is that there is a gap, which we must fill. There is a disconnect when children become young transitional or independent they do not continue to consume LaCroix.
CURRENT & EXISTING – Markets that are core consumers, which we must foster, while still having a potential for growth. Families with children in affluent suburban spreads and comfortable country. Couples with no children in affluent suburban spreads and comfortable country.
MARKET ANALYSIS
MARKET SIZE We were able to gather sales for the category of sparkling water from the last 4 years, with these numbers we are able to see exponential growth in the past three years. When we compare the category to LaCroix we are able to see that we have 8.9% of the market but I believe is most important to understand where our brand is by comparing the growth of the category to the growth of the brand alone. From 2011-2012 the category sales increased by 24.2%, were as LaCroix sales increased 30.4%. This allows us to say that LaCroix is growing with the category, which indicated to us that it is still in its growth phase of the product lifecycle.
Size of category // Sales Year 2012: $514,624,100 Sparkling water category sales: 2008 $ 330,100,000 2010 $351,076,562 2011 $390,085,068 2012 $514,624,100
Top Competitors 2012 Market Share – Sparkling Water Private Label Perrier San Pellegrino Sparkling Ice LaCroix Poland Spring
Market Market Market Market Market Market
share Share Share Share Share Share
21% 18.1% 15.6% 9.6 % 8.9% 4.3%
(P)RODUCT LaCroix Sparkling water is 100% natural, made with nothing artificial. Calorie, sweetener, sodium, caffeine & gluten free, LaCroix comes in 9 delicious flavors. It is made in the US.
HEALTH
La Croix is geared toward the lifestyle/health conscious consumer; LaCroix is also the only leading sparkling water that is sodium-free, unlike its imported competition (Perrier & Pellegrino).
A REFRESHING ALTERNATIVE
La Croix is also a refreshing alternative to a diet soft drink. Many consumers start to drink it to help them kick the habit of drinking high sugar or high calorie beverages. An alternative to boring tap/bottled water.
VALUE & FLAVOR
LaCroix Sparkling Water is currently available in eight flavors in 12 oz. cans: Coconut, Pure, Lime, Orange, Lemon, Berry, Cran-Raspberry and Grapefruit. New 12 oz. slim cans are available in Coconut, Lime, Pure and Cran-Raspberry.
ENVIROMENTALLY FRIENDLY
LaCroix Sparkling water, manufactured in the U.S., is 100% recyclable and boasts a lower carbon footprint than other imported sparkling counterparts.
MADE IN THE USA
Why import your water? An interest in local sourcing and product origin is on the rise in the minds of consumers. LaCroix water is the #1 domestically produced sparkling water.
ALL NATURAL
triple-purified and sourced from 12 regions throughout the United States. It is naturally carbonated, flavored with all-natural extracts, natural essence oils extracted from fruits, there are no sugars or artificial ingredients contained in or added.
SPECIAL DIETARY NEEDS
All flavors of LaCroix are gluten free. They are also Kosher and vegan. There is no meat, dairy, wheat or nuts.
SUSTAINABILITY
Ethical and Environmental concerns figure high in the consumer preference prediction. LaCroix Sparkling water eco-friendly cans are the only sparkling water in a can that is 100% recyclable and has a lower carbon footprint.
(P)RICE While researching we noticed that coupons were available in every online platform LaCroix was using starting with their own website, twitter, Facebook and Amazon.com. With this observation we can determine that LaCroix may not be purchased at full price, and that their consumer may be the type of consumer that utilizes those coupons. This gives us a little insight on whom our consumer is.
Amazon 24-Pack Peapod 12-Pack Office Depot 24-Pack
$12.91 $5.69 $10.99
LaCroix is an average of 50% less expensive that its top three competitor’s. So when we look at sales and compare them, the volume is there but the amount of sales is not going to be greater than the competitors.
(P)ROMOTION In the past 12 months LaCroix has had two big promotions in the way of a challenge. They are encouraging consumers to replace their next 40 cans of soda with LaCroix, for a healthier lifestyle. Now days, we are also able to know a bit about the LaCroix consumer and its loyalty for the product through Facebook and twitter. In this case we can determine that the best way to reach its audience its through Facebook because it has significantly more followers than the other two platforms they are present in. But Pinterest allows us to know a bit more about the kind of things our consumers like because their boards are insightful as to what they love and what they admire .
(P)LACE LaCroix’s website was a great way to understand were people can purchase the product as well as where they plan to be available in the near future. It is interesting to see that they only distribute to a few grocery stores, one department store, and have great online ordering access they will soon partner with office depot to sell their product on their website. Comparing LaCroix to its top three competitor’s they all have more retail outlets they are available in.
GROCERY
Dominick’s Mariano’s Whole Foods
DEPARTMENT STORE
TARGET
ONLINE
Peapod – Chicago, Milwaukee, S.E. Wisconsin, Indianapolis Amazon Fresh-‐ Seafle Area Only Office Depot -‐ Coming Soon -‐ NATIONWIDE
This is LaCroix Channel summary, 82% of the total product sold is sold in grocery stores. We must then believe that all others is online and at target with only 18% of their product volume coming from these outlets.
CHANNEL SUMMARY The chart on the right show us the channels in which our competitors are present but LaCroix is not. There are a few things that we can conclude from these charts. $6,000,000
LaCroix is only present in the grocery channel image 14.1 with 82% of their total volume coming from there. Instead Perrier, Pellegrino and sparkling ice all have two other very strong channels in which they are present. Image 14.2 shows us that in the top three high-income lifestyles all three main competitors are bough in here, more than $5,000,000 of S. Pellegrino’s sales comes from club stores in affluent suburban spreads followed by cosmopolitan centers with a little over $3,000,000. Mass merchandise. Only our top 2 competitors are part of this channel: S. Pellegrino and Perrier. Their sales in affluent suburban spreads, LaCroix highest segment, accounts for $550,000 - $825,000 in this channel alone
Consumer Profile Region = United States, Channel = Club, BehaviorStage = Total, Measure = Total $
$4,000,000
$2,000,000
$0
Cosmopolitan Affluent Centers Suburban Spreads La Croix R (Carb Bev : SD-Carb) Pints ** Perrier Reg (Carb Bev : SD-Carb) Pints *
Comfortable Struggling Modest Plain Rural Country Urban Cores Working Towns Living S. Pellegrino R (Carb Bev : SD-Carb) Pints Sparkling Ice Dt (Carb Bev : SD-Low Cal) Pints *
Image 14.2
TRENDS TECHNOLOGICAL
• Smart Packaging: The smart label revolution as its been called is a trend that may be just in the early works but that we predict will be seen more and more in the coming years. Digital labels that educate, that answer questions about the product, that tells you the perfect temperature of consumption. A label that is synched to social networks and will allow the consumer to share when they consume it. • There will be greater concerned that technology is moving faster than measures to protect the quality of human life and the environment.
POLITICAL
• Globalization largely irreversible, likely to become less Westernized, also referred to as ‘the rise of the rest.’
ENVIROMENTAL
• Plant based packaging: being able to recycle will not be enough of a measure to future generations, being able to decompose all of the packaging their products come in because they are made 100% out of plant material will be preferred.
SOCIAL
• More people will adopt a simpler, less consumer-driven lifestyle with greater levels of physical human interaction • Generational change – the ‘Millennial’ generation will start to exert a strong social influence as their digital-thinking merges (and clashes) with the old-style analogue world. Mass collaboration will lead to the invention of new industries • Aging populations in established powers. Rise and Fall of Generations (Boomers falling, Gen Y rising)
COMPETITIVE ANALYSIS
!
STRENGHTS • • • • •
•
(S)TRENGHTHS (W)EAKNESSES (O)PPORTUNITIES (T)HREATS
• • • • • • • •
Good for your health Good for the environment #1 domestic sparkling water brand Eco-friendly cans Popular amongst consumers due to being calorie, sodium, sweetener, caffeine and gluten free It has risen with environmentalists due to the sustainability of being the “only” sparkling water in a can 100% pure sparkling water Manufactured in the U.S. 100% recyclable Boasts a lower carbon footprint For over 30 years, the #1 sparkling water brand in a can in the U.S A true American favorite for over 30 years Linked to a lifestyle Portable convenient packages
OPPORTUNITIES •
• • • • • • • •
An interest in local sourcing and product origins is on the rise in the minds of consumers US is growing to be more heath conscious Alcohol-free fizzy holiday drinks still enjoyable Increase distribution channels Fountain (restaurant &bars) Vending machines (schools & gyms) Health & wellness trends Rising demand for American-made consumer goods In an effort to reduce obesity in the United States, the U.S. government proposed a tax on sugared soft drinks, and sugared beverages were increasingly unwelcome in certain venues across the country.
WEAKNESSES " " " " "
Low penetration compared to category Not a global brand Distribution outlets (Facebook) Not linked to hospitality industry (restaurant/hotels) Brand is not globally recognized unlike its competitors
THREATS • • • •
• • •
Globalization, easier for international brands to import International brands have a higher quality persona More choices, fewer calories from multinational brands Two main competitors, Pellegrino & Perrier are owned by Nestle, a global company. Sparkling performance category growing Congress is looking to impose a beverage tax There is a new healthy product boom with large label beverage companies, meaning more competition.
COMPETITOR No. 1 We ranked S. Pellegrino as our number one competitor when looking at the Fast Fact data because of these factors: 1) It has a significantly higher consumption index in what are ranked our strongest markets. They have an index of 201 in affluent suburban spreads compared to 160 for LaCroix. 2) 52.2% of their sales come from affluent suburban spreads and comfortable country, compared to 49% for LaCroix. 3) San Pellegrino indexes high with families with and without children in the 3 high-income lifestyle segments, the ones LaCroix is looking to target because of the important attributes within our consumers. Strengths S. Pellegrino is the third largest share in the sparkling water category with 15.6%, their sales for 2012 were $80,488,400. They are a global brand recognized as ’gourmet’ water. Positioned as a high-end beverage. This brand is owed by Nestle, a global company. Weaknesses Purchase price a little more expansive than other competitors and it is not a natural sparkling water
COMPETITOR No. 2
Not only does Perrier have the largest market share after private label, but it also has the cosmopolitan segments we are looking to target as well as the young transitionals and Independent singles. These two factors allows us to see that these segments are drinking sparkling waters, meaning that there is an opportunity for them to switch. Strengths Perrier had 18.1% of the sparkling water market share in 2012 making it LaCroix top competitor after private label sparkling water. The brand is recognized worldwide, it is originally a French brand, and now it’s a product of nestle waters. Perrier can be found in glass bottles, plastic and canned. Perrier mineral water is known to promote a nightlife culture in cosmopolitan areas, it is seen as a trendy young brand. Weaknesses Perrier can be found in natural and lemon flavor, the limited flavor choice may be seen as a weakness. Since it is a mineral water it has sodium may also be seen as a weakness.
COMPETITOR No. 3 Sparkling ice is the last brand we choose as our competitor by core consumer. This brand is also scoring very well with Affluent suburban spreads with 30.2% of their total sales coming from this lifestyle. They are also very popular with older bustling families, they account for 16.1% of their sales and share the high income couples 35+ segments with the other two competitor and LaCroix. Out of our three top competitors we are able to see that this brand is weakest in both cosmopolitan and comfortable country. But from our Market share chart we know that they have a larger market share in sparkling waters than LaCroix, this is why it is so important to keep Strengths Sparkling Ice zero-calorie (sweetened with splenda sucralose) naturally flavored, It is the only sparkling water competitors that has vitamin and is antioxidant-enhanced. It has been enjoying triple-digit growth. Sparkling Ice is available in Coconut Pineapple, Lemonade, Orange Mango, Pomegranate Berry, Lemon Lime, Kiwi Strawberry, Pink Grapefruit, black Raspberry. Weaknesses Newest in the market Not naturally sweetened
COMPETITIVE ANALYSIS
LaCroix
S. Pellegrino
Perrier
Total Consumption
20.53
35.40
73.66
Penetration
0.56%
1.71%
1.43%
Buying Rate
36.89
20.67
51.69
Product DiagnosRcs
Chan Channel Total
Channel Summary
Channel
Volume per
Summary
% Volume
100 HHs
Grocery
82%
16.83
All Other
18%
3.70
Top 3 Demo
Household Income
attributes
Education of hh Occupation of hh
Census Division
S. Atlantic 35.6% / 178 W. South Central 21.7% / 190
Total $ per
Summary
% Total $
100 HHs
Club
46%
12.48
Grocery
42%
11.45
All Other
7%
2.01
5%
1.46
Mass Merchandise
nel S
% Total $
Channel Summar
% Total $
Sparkling Ice 21.66
1.29%
16.74 Total $ per 100 H Total $ per 100 HHs Hs
Club
50%
12.45
Grocery
34%
8.48
Mass Merchand ise All Other
12%
3.10
4%
0.99
Household Income
Household Income
Education of hh Occupation of hh
Age of Head of Household
Pacific 31.4% / 211 Middle Atlantic 23.1% / 175
Channel Summar y Grocery
% Total $ 50%
Total $ per 100 HHs 7.37
47% 3%
6.91 0.40
Club All Other
Household Income Household Composition Number of Persons
Education of Head of Household
Pacific 22.9% / 155 South Atlantic 21.4% / 107
5
3
2
Pacific 33.9% /229 South Atlantic 19% / 95
!
The chart above narrates very well the competitive set, each brand weakness and strengths. Lets start by looking at total consumption. The highlighted number is the strongest competitor in this case in total consumption, as we can see Perrier has an incredibly high consumption rate when compared to the other brands here with 73.66, and LaCroix is the weakest when looking at this cell. When talking about Penetration, S.Pellegrino has a higher percentage with 1.71%, LaCroix is also very weak in this with a .56% penetration. Perrier has a Buying rate is extremely high compared to the others with 51.69, in this measure LaCroix is second highest with 36.89. When looking at distribution channel, we can see that there is an advantage of number of channels between LaCroix and its competitors. This could b a great opportunity for growth. The 3 top demographic attributes of S. Pellegrino and LaCroix are the same, it varies in one with Perrier which includes age of head of household instead of occupation and for sparkling ice, # of people in household and household composition. Lastly, when talking about highest consumption in census divisions we can see that all three competitors were strongest in the Pacific whereas LaCroix is strongest in the South Atlantic.
POSITIONING STARTEGY
CRITICAL ISSUES/ KEYS TO SUCCESS ONE DISTRIBUTION CHANNEL LaCroix is only present in the grocery channel image 14.1 with 82% of their total volume
coming from there. Instead Perrier, Pellegrino and sparkling ice all have two other very strong channels in which they are present. Through research we are also aware that supermarkets are loosing market share over drug stores this is why it is important to plan accordingly
CATEGORY/BRAND GROWTH Sparkling water category exhibited impressive growth in 2011& 2012.
There was a marketing push for the category because all brands within it grew at a high rate. La Croix is the #5 brand when looking at brand share in the sparkling category.
LACK OF TRIAL When talking about Penetration, Pellegrino has a higher percentage with 1.71%, LaCroix is also very weak in this with a .56% penetration.
PRICE La Croix offers flavors and value, it is sold at the lowest price compared to sparkling water competitors in the market BALANCE MALE/FEMALE COMMUNICATION The consumption of male & women of sparkling water is 45.5% male vs. 55.5% female according to MRI Data
FLAVOR INNOVATION in the segment can bring growth HEALTHIEST ALTERNATIVE IN THIS CATEGORY LaCroix contains no sodium or sugar unlike our competitor’s. FILL GAP No. 1 COSMOPOLITAN CENTERS All of our competitor’s are strong where we are already successful we now must work to be where they are.
FILL GAP No. 2 YOUNG TRANSITIONALS & INDEPENDENT SINGLES We are strong with families and older couples, there is a gap in this segment that we must look to fill.
EDUCATION
to educate the masses about the difference between sparkling water and mineral water (with and without sodium)
DIETARY RESTRICTIONS Target new consumers with dietary restrictions that enjoy carbonated beverages
OBJECTIVES 1
Increase sales by 6% = $2,747,030 = 626,000 cases @ $4.39 by the end of 2014 fiscal year
2
Increase penetration by 10% = Add 79,387 HH = From .56% -.62% by end of 2014 fiscal year
3
Increase awareness of the brand LaCroix as a sparkling water by 10%
4
To increase distribution channels from 1 to 3 in 18 months
5
Increase consideration as a healthy alternative by 30%
6
New flavor development & launch to market by July 2014
SALES PROJECTION SUMMARY
POSITIONING STRATEGY To be your everyday sparkling water for a refreshing & healthier life
LIFE CYCLE STRATEGY
YOUR DAILY REFRESHMENT.
TARGET MARKET STRATEGY Cosmopolitan Centers are currently indexing total 97, with 13.1% of our total dollars. We see a huge amount of potential by targeting cosmopolitan centers because they have higher incomes and as discussed earlier that is the #1 demo attribute that dictates our consumers. We also believe that since we already have high consumption with families with or without kids in the other two high-income lifestyles (affluent suburban spreads and comfortable country), we should be able to attract the same behavioral stages in the cosmopolitan areas. Young Transitionals & Independent singles in Cosmopolitan areas, Affluent Suburban spreads and comfortable country. We see these two segments as a great opportunity to create future loyalist. This will be the most challenging demographic to capture because at the moment we do not rank high in the market. What allows us to be able to target these segments is that there is a gap, which we must fill. There is a disconnect when children become young transitional or independent they do not continue to consume LaCroix. Families with children in affluent suburban spreads and comfortable country. Couples with no children in affluent suburban spreads and comfortable country.
(P)RODUCT STRATEGIES & TACTICS
(P)ROMOTION STRATEGIES & TACTICS
(P)RICE STRATEGIES & TACTICS
(P)LACE STRATEGIES & TACTICS
FINANCIAL SUMMARY Financial Summary
Marketing Budget (% of Mfg.Sales)
Projected Mfg. Sales Marketing Budget
in millions 48,530,870.40 9,706,174.80
20%
Contribution Margin
Marketing Budget
2013 (est.)
10,676,791.49
Budget Allocation (%) 20%
2013 9,706,175 No chargeback to budget
Marketing Staff Marketing Research
$
1%
97,061
Media
$
52%
5,047,210
Creative Production
$
10%
970,617
Sales Promotion
$
15%
1,455,926
Sales Literature
$
1%
1,941
Trade Marketing
$
15%
1,455,926
PR
$
4%
388,246
Training
$
2%
194,123
Total Marketing Budget
$
100%
9,611,050
MARKETING MEASUREMENTS & METRICS