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BBUS402.2 Principles of Marketing
Transcript of BBUS402.2 Principles of Marketing
Fruits and veg have 0% tax,
100% fruit juice smoothie, classified as beverages and luxury face 17.5
The ‘Macroeconomic Analysis’ consists of the behavior and the environment around the world. This can impact a firms performance which sometimes may not be in the firms control.
(Jobber and Ellis, 2013)
: Thirst - Vitamins
: Engaging Packaging, Quality
: Charity, Good suppliers relations
BBUS402.2 Principles of Marketing
Innocent Company audit
by Oscar, Nehal, Ryan, Maryam
INNOCENT - Squeezed Overview
Industry: FMCG - Beverages
Founders: Richard Reed (CEO), Adam Balon and Jon Wright
Operations: EU - 13 Countries / Based in London, UK (Innocent, 2014)
Revenues: £ 202 millions (Coca-Cola, 2012)
Recommendation & Conclusion
Recession 2008 - Credit Crunch
Innocent bankrupt because they unable to find capital to finance corporate operations
Available at big 4 supermarkets.
Wholesalers to distribute product to small stores & fast-food chains (e.g. Eat) and saturate the market.
Subsidiary of Coca-Cola: use of the established channels of distribution.
More "Thirsty" Theory
This Micro analysis uses Porter's 5 forces framework. It allows industry analysis or business strategy development. This was published by Michael E. Porter of Harvard Business School in 1979.
(Kotler et al, 2013)
Sustainable packaging .
100% Plastic bottles recyclable (Innocent, 2014)
Natural disasters, - may effect supply chains increasing fruit prices.
People: more health conscious / Eat more healthy products (Mintel, 2013)
23.9% of the UK women and 22% UK men being obese (BBC. 2011).
Innocent provides 2 of you 5 a day
New entrants - Medium
High Demand: Increase interest in healthy lifestyles, (National Diet & Nutrition Survey, 2012)
Easy to enter the market: Start-up costs are low (Mintel, 2013)
Saturated market (Mintel, 2013)
Substitutes - High
Many substitutes available: fizzy drinks, flavored water. However customer-base more focus on healthy alternatives.
Green tea, coconut water becoming the new healthy alternative (Mintel, 2013).
Supplies are from a all over the world – Dependent on international distribution and climate factors.
Healthy relationships with suppliers (BBC, 2011)
POwer of BUYERS - HIGH
B2B (FMCG) - Price sensitive
B2C - Quality as main drive (non-price sensitive): Coca-Cola 90% stake may be perceived as a drawback (The Grocer, 2013).
Porter's 5 Forces
Highly competitive market: Big 4 [supermarkets] own brands & local organic alternatives
Innocent’s USP - ‘100% natural fruit’ common promotion strategy
“Innocent enjoys an 75% share of the UK Smoothies market.” (BBC, 2010)
Declining trend: cannibalization from mother company own brands (Mintel, 2013)
Nature of Competition
Power of Suppliers - Low
FMCG: Focus on mass advertisement (e.g. TV).
Strong branding: unique packaging and brand values well communicated through quirky packaging to increase Brand Equity.
Positioning: Value Added product ‘more-for-more’
Segments: Happy to pay for added benefits - health content and ethical sourcing of ingredients.
Supply chain ready
Growing market size (Mintel, 2012)
High margins per unit (Mintel, 2012)
Brand Equity transferable
Even More "Thirsty" Theory
Is marketing strategy in which a firm marketing a product with a well-developed image uses the same brand name in a different product category (Keller, 1998)
The value of having a well-known brand name (Keller, 2003)
Cycling carts targeting parks, universities, in London, Brighton, other big cities
McDonald's & Coca-Cola Joined Venture: Introducing smoothies with breakfast.
Drop price by introducing bigger family pack bottles.
High Margins (Mintel, 2013)
Supply Chain ready – i.e. This Juicy Water
Coca-Cola’s Dasani experience in UK – Case Study (Lindgreen et al., 2009)
It is the smallest detectable difference between a starting and secondary level of a particular sensory stimulus (Bebin, 2012)
Guerrilla marketing is an advertising strategy in which low-cost unconventional means (Levinson, 1983)
...Last one - Theory
Q & A
Anthony, S. D. 2008. The innovator's guide to growth. Boston, Mass.: Harvard
Bowman, C. and Faulkner, D. 1997. Competitive and corporate strategy. London:
Bradley, N. 2013. Marketing research. Oxford [u.a.]: Oxford Univ. Press.
Campaign. 2014. The Week - Innocent offers 2012 tickets. Campaign, p. 9.
Golder, P. N. and Tellis, G. J. 2004. Growing, growing, gone: Cascades, diffusion,
and turning points in the product life cycle. Marketing Science, 23 (2), pp. 207--218.
Heavey, C. 2014. Innocent - Brand Book. Conference & Incentive Travel - CIT, p.
Innocent. 2014. Innocent - Little Tasty Drinks. [online] Available at:
http://www.innocentdrinks.co.uk/us/being-sustainable/legacy [Accessed: 20
Jobber, D. 2007. Principles and practice of marketing. London [u.a.]: McGrawHill Education.
Knowles, A. 2011. Brand Lesson. Marketing Magazine, p. 16.
Kotler, P., Armstrong, G., Wong, V. and Saunders, J. 2008. Principles of
marketing. Upper Saddle River, N.J.: Pearson Prentice Hall.
Kotler, P., Kartajaya, H. and Setiawan, I. 2010. Marketing 3.0. Hoboken, N.J.:
Lockwood, D. 2008. Smoothie Sailing. Prepared Foods, Iss. 4 pp. 13-18.
Marketing Magazine. 2011. Innocent. Marketing Magazine, p. 16.
MarketLine. 2013. United Kingdom - Soft Drinks 2013. United Kingdom - Soft
Drinks. [report] London: Informa Business.
MarketLine. 2012. Innocent Ltd. 2012. Innocent Ltd. [report] London: Informa
Oscar Simon Chu Ortega CW2: Reflect and Evaluate Innocent’s Marketing Principles
Mintel. 2013. Fruit Juice, Juice Drinks and Smoothies - UK - November 2013.
Fruit Juice, Juice Drinks and Smoothies - UK. [report] London: Mintel.
The Grocer. 2014. Juices and Smoothies Category Report 2014: Hard pressed?.
Juices and Smoothies Category Report. [report] London: William Reed
The Grocer. 2011. Focus on Juices & Smoothies: Keeping the Juices Flowing.
Focus on Juices & Smoothies. [report] London: William Reed Business Media.
Which?. 2014. Is your fruit smoothie as healthy as you think? - December - 2012 -Which? News. [online] Available at: http://www.which.co.uk/news/2012/12/is your-fruit-smoothie-as-healthy-as-you-think-305688/ [Accessed: 27 Mar