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Snapple

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by

Marie Lombardo

on 10 April 2014

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Transcript of Snapple

Quaker Oats Takeover
1994- $1.7 billion acquisition deal
Young trendy consumers were switching back to pop and clear sodas
Started to take consumers idea for flavors
Ralph's Cantaloupe Cocktail
1995- First annual Snapple Convention
Snapple Sales
Decline
1995 - $40 million sampling campaign,
20% sales drop for the quarter
1996- inside the bottle cap game promotion
$40 million nationwide giveaway campaign, including TV, radio advertisements
New advertisement campaign to replace Wendy ads
Spike Lee replaced Rush Limbaugh and Howard Stern
1997- Iced tea dropped another 4.7%
Snapple Commercials
Emergence of Snapple
1978 - Meaning behind the name Snapple: created apple soda that fizzled
First all natural beverage line
1980s - created non-carbonated beverage segment
Goal: make a natural product that tastes, smells and looks good
Raised capital
sold portion to Thomas H. Lee
went public: 4 million shares at $20
New Age Beverage Market
Health conscious consumer
Eight distinct groups
ready to drink tea, sports drinks, bottled water, fruit beverages, and natural soda
3rd in beverage consumption rankings
Ready to drink iced tea grew 189%
History
1972 - Established by Leonard Marsh, Hymann Golden, and Arnold Greenberg
1994 - Quaker Oats Company purchased for $1.7 billion
1997 - Sold to Triarc Beverage Group for $300 million
2000- Bought by Cadbury Schweppes for $1.45 billion
Currently owned by Dr. Pepper Snapple Group
spun off Cadbury in 2008
1990s: New Competition
Pepsi/Unilever: Lipton iced tea
Tetley/A&W: Pearle
Coca-Cola: Fruitopia, Nestea
Arizona Iced Tea
Roberta Fernandez, Amanda Lafferty, Marie Lombardo, and Jeremy Robbinson
Early Marketing Efforts
Early 1990s - successful ad campaigns
TV, Radio: off beat humor & jingles
Packaging: art critic to analyze label
Product placement: Seinfeld, Sleepless in Seattle
Sponsorships: Rush Limbaugh, Howard Stern, Jennifer Capriati
Word of mouth
Event appearance: unusual events
Wendy Kaufman: "The Snapple Lady"
testimonial advertising
public appearances: Oprah Show
Snapple
Advertisements
Errors Made by Quaker Oats
1st summer season
no regular advertising schedule
no introduction of a new product
Overall sales decline: 19-35%
Jane Hurley exposure
less than 10% fruit juice
equivalent to Hi-C
Snapple and Gatorade distribution not compatible
Quaker's New
Strategies
New brand management team
Reduced number of flavors from 50 to 35
Reduced contract manufacturers
Tripled the ad budget
Seasonal and Diet lines Introduction
Supermarket accessible packaging
12 and 4 packs
Plastic 32 and 64 oz bottles
Supply chain improvements
Brandweek- " They can't even give Snapple away right."
Corporate brand consultant- "What the hell is Snapple? No one knows what is means any more."
Triarc
1997- sold to Triarc for $300 million
Invested heavily in new product development and marketing strategies
Mission: rebuild the brand, differentiate against competitors, capture consumer attention
Edgy advertising, strong distributor relationships, colorful labels and focused street sales
Brought back Wendy to bring Snapple back to its core values
New Products
Whipper Snapple- first bottled fruit smoothie, unique bottle design, eye-catching labeling, creative and the variety of flavors
Sweet Tea- appeal to southerners, competed with a similar beverage marketed by Nantucket Nectars
Snapple farms- 100% pure juice drink, school lunch market
Snapple Hydro- characteristics of a sport beverage, contains electrolytes, for the health conscious consumers
Snapple Elements- 6 flavor herbal-enhanced fruit drinks and teas, health-conscious consumers
Triarc's Marketing
Recapture Snapple's image before it was acquired by Quaker
off the wall marketing technique
Sponsorship agreement again with Howard Stern, Rush Limbaugh and Wendy
Win Nothing Instantly contest
free rent for a year, no car payments for six months
Restore attitude and quirkiness
packaging and labeling- maximize color
Slowed the downslide
sold 100 million more bottles than Quaker
1998- 8% rise in sales
Triarc's Future
TV Advertising- $27 million campaign
product focused message including differentiation
premium and all natural positioning
Sponsorships
official iced tea of the New York Yankees
enhanced local significance
signed olympic figure skater- Tara Lipinski
Website
May 1999
innovative to support promotions
Brand Performance 1999-2000
14% increase of case sales
40% market share
brand extension: candy products
27% increase of volume sales
Cadbury Schweppes
Bought for $1.45 billion
$500 million in cost savings through distribution and manufacturing
International- Five operational units
America, American Confectionery, Europe, Middle East, Africa, and Asia Pacific
Bought Nantucket Nectars
Cadbury Endevours
Discontinued new products
Altered ads for younger generation
New energy drink- Venom
2002- Personified Bottle ad campaign
targeted range of demographics
2002- 13 city tour across the US
2003- first nine months volume rose 3.2%
Official beverage of NYC
failed- contract to sell 750,000 cases
sold only 26,000 by July
Last Five Years
2009- made with real sugar
Now owned by Dr. Pepper Snapple Group
42 different flavors
diet, regular, tea, juice, and specialty
Marketing efforts
sex appeal for younger demographic (18-24)
"Re-enFACTments" campaign- videos, social media, animated gifs, memes, vines
Recommendations
Placement
Fountain drink market
Vending machines: schools and professional
New line for alcoholic mixers
target market is ages 18-24
Keep advertising towards younger crowd
Fun and spirited TV advertisements
New label design - modernize
Health conscious market
Substitute sugar for Sugar in the Raw or Stevia
Brew tea with organic tea leaves
Vitamin, antioxidant, protein drink
Overall Challenges
Poor brand image
steady image during emergent time period
Decline in revenue
decrease in sales during Quaker ownership
Growing competitive market
first drink of its kind but now has competitors that obtained more market share
Full transcript