Marketing Research

Table of Contents
Introduction......................................................................................................................................3

Product positioning strategy analysis..............................................................................................3

Problem Statement.......................................................................................................................3

SWOT Analysis of Crescent Pure................................................................................................4

Porter's Five Forces of Crescent Pure..........................................................................................4

Factors influencing the positioning of Crescent..........................................................................5

Recommendation.............................................................................................................................6

Conclusion.......................................................................................................................................7

Reference List..................................................................................................................................8

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Introduction

The non-alcoholic beverages market in the U.S is growing rapidly which includes various ranges
of liquid refreshment beverages. This market significantly contributes to the economy of the
country. Portland Drake Beverages (PDB) is a non-alcoholic beverages company that has
acquired Crescent Pure. Crescent Pure is another non-alcoholic beverage company that only
focuses on all-natural energy enhancing drinks. It can be seen that by acquiring Crescent Pure
PDB beverages can expand their business into Energy and sports drinks which are now in high
demand.
Sarah Ryan, Vice President of marketing for PDB beverages, has conducted marketing research
about the positioning strategy for Crescent Pure. The aim of the research was to broader the
positioning strategy of Crescent Pure as a healthy drink. As a marketing research consultant, the
following report consists of an evaluation of market research made by Sarah Ryan and the
appropriate recommendations for the correct positioning strategy of Crescent Pure.

Product positioning strategy analysis

Problem Statement

PDB has recently acquired Crescent Pure, a natural energy drinks company, to introduce a new
segment of products into the market. The company is planning to launch the product with the
most appropriate positioning strategy in three regions by January 2013. Though PDB is planning
to Crescent Pure nationally the marketing team suggests making a soft launch by January 2014.
The marketing team is confused about three critical positioning strategies. Some of them
proposed that the product be positioned as a sports drink but some of them considered it an
energy drink. On the other hand, the remaining are suggested as healthy drinks. Sarah Ryan, VP
of marketing has conducted thorough market research of the product and after considering all
recommendations has decided to broader the positioning strategy of Crescent as a healthy drink.

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SWOT Analysis of Crescent Pure

Strengths: Crescent Pure had a huge market demand for their product which is a pure organic
energy drink. The owner of the company was making significant returns before coming to PDB’s
acquisition. As the energy drink market is expanding rapidly PDB is also expected to grow in the
future with Crescent. With the product’s strength along with PDB’s strong distribution channel,
the company will witness future growth (Khanlarov et al. 2020).

Weakness: The company has decided to launch the product at a very lower price to compete with
their rivals but this might affect customer acquisition (Martins and Serra, 2018). As Crescent is
purely an organic product customers might not purchase the product at that low price. This
affects the profitability of the company in the future.
Opportunities: People are becoming more health-conscious and due to this the health drinks
market is in high demand. In the market of non-alcoholic beverages, sports drinks have a market
size of around $134 billion As people are shifting from sports drinks to health drinks, Crescent
Pure has an opportunity to capture a large segment of customers by expanding nationally.
Threats: Competition among various energy drink manufacturers is a possible threat for PDB.
As the key rivals of PDB, Razor, Torque, and Fright are dominating the energy beverages
market, it will be difficult for PDB to launch a new product in the market.

Porter's Five Forces of Crescent Pure

As a marketing consultant, it is essential for identifying the different sector dynamics by porter’s
five forces. This technique will allow PDB beverages to explore different industry situations
before launching Crescent pure energy drink.
Barriers to entry: As the product is different from other energy drinks, PDB needs a huge
amount of capital investment to get Crescent Pure into their production line (Letunovska et al.
2021). There are various types of energy drinks available in the market but all-natural energy

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drunk of Crescent will face low entry threats. Crescent pure has a loyal customer base in the
market this is an advantage for PDB.
Threats of substitutes: The availability of substitutes is indeed a concern for Crescent Pure due
to the competitive environment of other firms. Customers can shift to alternative products at a
reasonable price if the substitute threat persists (Pitts et al. 2018). However, this threat severity is
substantially low for Crescent Pure. The price of the product is comparatively low and the
customer cannot get the same quality of Crescent in others substitute products.
Competitive Rivalry: Competitive market of PDB can influence the competition of Crescent Pure
energy drink. This rivalry can be low if the market grows fast and if the quality is maintained.
All-natural energy drinks can affect the customer as they are switching from sports drinks to
healthy drinks and the exit barriers are significantly low for the firm.
Bargaining power of Buyers: It indicates the pressure made by customers on the firm to get
high-quality products at affordable prices. The strong customer base of Crescent pure will
definitely help PDB in the market. The bargaining power of customers can be increased by
diversifying their market base further and adopting marketing strategies (Bruijl et al. 2018).
Bargaining power of suppliers: This is the pressure exerted by the suppliers on the organization
on different aspects such as product availability, reducing cost, and increasing the price. These
can affect the business and high supplier power can also increase the competition. If suppliers are
less than the demand for the product, the position of Crescent pure will be increased. Lack of
availability of substitute products can enhance the position of the firm against the suppliers
(Benzaghta et al. 2021).

Factors influencing the positioning of Crescent

Market Growth: The positioning of the product is depending on the market growth in different
categories. The sports drinks market is comparatively slower than the rapidly growing energy
drink market. But the market growth of both the category is expected to grow in the next five
years as forecasts suggest. The organic drinks market has also grown significantly in 2013 (Pitts
et al. 2018).
Price Range: The price range of different types of sports and energy drinks varies according to
the can size. The average price varies from $2 to $5, whereas an 8 oz. of energy drink costs

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around $2.99. The organic beverages have a premium price range which might affect the
positioning of Crescent and the price range set by PDB.
Competitive structure: The other competitors of PDB are concentrated on energy drinks
whereas the sports drink market is limited. This factor essentially influences the positioning of
Crescent for gaining a highly competitive market share.
Customer value: The positioning of a product also depends on the customer values of that
product. Crescent is a certified organic drink, which contains low caffeine and low sugar base.
This differentiates the product from an energy drink. A product containing all-natural ingredients
appeals to the health-conscious customer market (Bauner and Wang, 2019). Based on that
company need to decide the positioning of Crescent to capture the market.
Threats: The government has imposed various regulations on energy and sports drink segments
which critically affects a large consumer base. negative media speculation critically affects the
consumption of various non-alcoholic beverages.

Recommendation

According to the analysis, PDB can position Crescent in three different ways. As it contains
hydrating elements, it can be easily positioned as a sports drink but the relatively higher price
segment of $2.75 can affect the position. Low sugar content and all-natural organic ingredients
have given the product advantage. PDB needs to sell the product at a lower price to compete in
the sports drink market. Another positioning strategy can be implemented which is to position
Crescent as an organic healthy drink. With the help of this positioning strategy, the company can
easily promote health consciousness among different aged customers. As the product is
organically certified, the company can sell the product easily in the evolving organic product
market. This broader positioning strategy will lead to an increase in advertising expenditures and
product launch delays. The product contains caffeine which is the same as in a cup of coffee
hence, it can also be positioned as an energy drink. The energy drink market is a fast-growing
non-alcoholic beverages market and negative publicity about health risks can be a beneficial
factor for PDB to position Crescent as a healthy energy drink.
According to my expertise in market research, the following section describes all the pros and
cons of positioning Crescent as an energy drink or a sports drink or a healthy organic beverage.
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Sports Drink: The sports drink category is expected to from $6.3bn in 2013 to $9.5bn in 2018.
Due to low sugar levels and a diet-conscious recipe this product can be beneficial for consumers
as people are shifting from energy drinks to sports drinks. These are the pros related to the
positions of Crescent as a sports drink. On the other hand, Crescent is in a comparatively higher
price range than other drinks in the same category. The company didn’t have a favorable
experience with premium pricing of previous product launches and customers can question the
company about the quality of the product at a lower price.
Energy Drink: As the product is having a low sugar level it is an advantage for PDB compared
with other energy drink manufacturers. The price of the product ($2.75) is comparatively low
than the average energy drink price ($2.99). This product is different from other energy drinks as
it contains less caffeine so there are no similar products available on the market. On the other
hand, this product is low on energy as people focus energy content in those drinks. There is huge
competition among various brands as this segment is highly demanded.
Healthy Organic Drink: There is an advantage in positioning crescent as a healthy drink. The
organic drinks market is growing slowly and the competition is comparatively low in this
segment as not many companies are offering organic drinks in the market. People are willing to
pay a premium charge for organic products. All-Natural ingredients can affect the sale of the
product. But consumers looking for sports and energy drinks might reject this product. This
segment is growing slowly hence, the growth aspects are comparatively low on this positioning
strategy.

Conclusion

Thus, from the above analysis, it can be concluded that all the three positions strategies of
Crescent are beneficial as well detrimental in their respective ways. PDB needs to focus on a
particular segment or the brand may get diluted. According to my expertise, PDB needs to
position the product as a healthy energy drink. This might affect the non-alcoholic beverages
market easily and witness substantial business growth in this segment.

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Reference List

Bauner, C. and Wang, E., 2019. The effect of competition on pricing and product positioning:
Evidence from wholesale club entry. International Journal of Industrial
Organization, 67, p.102525.
Khanlarov, E., Chyhryn, O.Y. and Liulov, O.V., 2020. Marketing and management strategies
for enhancing green competitiveness (Doctoral dissertation, Varazdin Development and
Entrepreneurship Agency and University North).
Martins, F.S., da Cunha, J.A.C. and Serra, F.A.R., 2018. Secondary data in research–uses and
opportunities. PODIUM sport, leisure and tourism review, 7(3).
Letunovska, N.Y., Liulov, O.V., Pimonenko, T.V. and Aleksandrov, V.T., 2021. Environmental
management and social marketing: a bibliometric analysis (Doctoral dissertation).
Pitts, S.B.J., Ng, S.W., Blitstein, J.L., Gustafson, A. and Niculescu, M., 2018. Online grocery
shopping: promise and pitfalls for healthier food and beverage purchases. Public health
nutrition, 21(18), pp.3360-3376.
Benzaghta, M.A., Elwalda, A., Mousa, M.M., Erkan, I. and Rahman, M., 2021. SWOT analysis
applications: An integrative literature review. Journal of Global Business Insights, 6(1),
pp.55-73.
Bruijl, G.H.T., 2018. The relevance of Porter's five forces in today's innovative and changing
business environment. Available at SSRN 3192207.