CoCo Water Selling Strategies - Report Example

CoCo-Water Contents Contents 2 Introduction 4 New Product Development and Rationale 4 Primary Research Data Collection 5 Analysis 7 Secondary Research and Analysis 8 Strategic Marketing Plan 9 4 Ps of Coco Water 9 Product 9 Price 10 Promotion 10 Place 11 STP Analysis 12 Segmentation 12 Target customers 12 Position 12 Conclusion 13 References 14 Appendix 15 Introduction Coconut water is the most nutritious and delicious drink that many individuals prefer to have. Coconut water has many medicinal properties. The sweet and pure coconut water have enormous therapeutic features and considered to be a major thirst quenching health drink for individuals of age groups. These types of products are healthier than those of energy drinks present in the market. Tender Coconut water is loaded with salts, vitamins, minerals and sugar. It is low on calories and fat and don’t have any cholesterol. Tender Coconut water is said to ward off any kind of fatigue within an instant because of its rejuvenating power. The aim of this report is to present a new product in the form of packaged coconut water to the customers during all seasons. Tendered coconut water is accessible to all individuals in subtropical countries. But the main problem is that coconut water found in the road side is not hygienic in nature and thus many individuals avoid drinking them in the open. The name given to the new company is CoCo Water which has four different product lines namely Coco-Natural, Coco-Flavour, Coco-Health and Coco-Energy. The main idea of the product is to present the product as natural thirst quencher and be a substitute of energy drinks present in the market. The vision of the company to be the largest producer of packaged tendered coconut water in the world by 2020. This report will look after the rationale behind such new product and the marketing strategies which the CoCo Water needs to take to make the product successful. New Product Development and Rationale The tender coconut water has many important medicinal properties which made the company come out with such a product. The name of the product is CoCo Water. This part of the report will look at the market research conducted to find out the relevant demand and strengths and weaknesses of the product. Logo of Coco Water Primary Research Data Collection Data collection is the main step while going for any market research of launching a new product. Here data collection is done through means of Primary and Secondary data collection method. Given in the appendix are some important questions asked to UK consumers with respect to launching of the new product in the UK market. A sample of 100 consumers was taken to conduct the primary research. The first question was regarding the gender of the respondents. It was found that 60% of the respondents were male and remaining 40% was female. The second question was regarding the age bracket in which they belonged. It was found that 55% of the respondents fell in the 18-25 years bracket range, 35% fell in 26-35 year bracket range while 10% fell in over 36 years range. This showed that the majority of the respondents belonged to the teenage to young generation age group. But the study was conducted taking into account individuals of all age group. This helped in proper representation of the society where people of all age group co exist. The third question was regarding the popularity of the term coconut water to them. It was found that the 78% of the respondents have never heard of the term tender coconut water. The rest 22% have only heard the term. This indicates that tender coconut water is a not a popular term in UK market. The majority of the respondents have never listened the term and have no idea of what it is. The remaining 22% of the respondents who have heard the term have seen it in other countries while travelling abroad. For instance a few of them while visiting in countries like Brazil and USA have seen the tender coconut water sold in their hyper markets or in beaches. A few of them have tried and mentioned that it taste great. But none of them has ever seen the product in UK. The next questions discusses about the important benefits of the tender coconut water. 22% of the respondents who have known about the product responded to the questions. It was found that all of them gave taste and thirst quenching as the main benefits of the product. The next questions focuses on the features customers looks at while deciding on a soft drink. All of the respondents gave health benefits and Calories as the main reason for deciding a soft drink. 15% of the respondents further gave Taste, Branding, Appearance, Portability and Refreshment as the other important feature which they would like to look at before buying any product. The next questions look at the price which the consumers would be willing to pay for 300ml tender coconut water. It was found that 80% of the respondents would be willing to pay in the range of £ 1.01 - £ 1.50. The remaining 20% of the respondents replied that they are willing to pay in the range of £1.51 - £2. The next question refers the settings or occasion when the customers would be willing to use the product. It was found that 60% of the respondents wanted to use the product in Sports Centres and Supermarkets. The remaining 40% of them wanted to use the product in Health Food Outlets. Analysis After doing the primary research, it was found that majority of the respondents under survey did not know about tender coconut water. Only a few of the sample size knew about the product since they have seen it while they went abroad. This indicates that there is an opportunity for CoCo Water to enter into the UK market. But simultaneously it represented a threat since they have to begin from scratch by building the brand and making it aware to the consumers. The respondents were not fully aware of the health benefits associated with the product (Fife, 2007, p. 158). This indicated that they have to be aware of the benefits of drinking the product. This represented a threat since the product has to compete against the widely known brands of energy drinks. Further the respondents mentioned that the main features which they look at before buying any soft drinks are the health benefits, Calories, Taste, Branding and Appearance. The main weakness of Coco Water is that they don’t have brand presence in UK market. The main strengths of the company are its Health benefits and refreshment it can offer to the consumers. In response to the price of an average 300 ml bottle of Coco Water, the majority of the respondents wanted to pay in the price range of £ 1.01 - £ 1.50. This represents the weakness to the company since initially they will have to invest heavily into their business and the cost per bottle may come out to be more than it to reach breakeven in two years. The next question gives us the clue on where the respondents believe they can use the product. Based on the reply it can be concluded that Coco Water is being perceived mainly as a rejuvenating drink and occasional health drinks (Grimwood, 2001, p. 93). Secondary Research and Analysis The secondary research was conducted by taking references from journals, government sources, magazines etc. A major finding was found out after doing the secondary research. The tender coconut water industry is in its growth phase. The market is nascent in UK, but in countries like USA, Brazil, Philippines the industry is in boom stage. People in UK are more attracted towards the energy drinks though several health originations have raised objections to these energy drinks because of presence of high amount of Caffeine in it which is harmful to consumers. But tender coconut water exerts a universal consumer appeal since it is natural, unadulterated, and virtually unprocessed. The major entry barrier in this industry is the huge investment needed into the production process and technology. Apart from this Coco Water faces the threat from established energy drinks and soft drink producers like Red Bull, Monster, Pepsi, Coca Cola, etc. They are established player and it will be difficult to find shelve spaces in Hypermarkets or Supermarkets across UK. The main substitutes for this industry are the cold drink companies and the health drink companies. Strategic Marketing Plan 4 Ps of Coco Water Product Tender coconut water is a nutritious, sterile and thirst quenching health drink. It is known that tender coconut water has many medical properties and it can be used as a universal health drink for all age groups. It can be a substitute for energy drinks since energy drinks contain Caffeine and other hazardous ingredients. Tender coconut water has many health benefits like it is good for infants who suffer from intestinal disturbances. It keeps the body cool and energizes the body during hot summer season. It can be used to reduce the rashes caused during small pox. It also has an electrolytic effect. Thus tender coconut water can be given to pregnant ladies because it is a good source of calcium, manganese and Vitamin C. It is also fat free and has zero cholesterol. This is beneficial to the fitness specialist persons. Thus the product has a wide range of benefits for all types and age group people. The product will be available in cans, eco-friendly bottles and packs. There will be four product offerings. Coco Natural – It is a simple natural thirst quencher. Coco Flavour - The product will come in different flavours like Oranges, lemon, grape, Chocolate and litchi flavour. Coco Health – This will include special herbal extracts targeted for health conscious segment. Coco Energy – It will be promoted as energy or sports drink. Price According to primary research conducted, majority of the consumers wants the price of a standard 300 ml bottle size of be in the range of £ 1.01 - £ 1.50. Coco Water must price its products such that they can maximize their market share. They must believe that with higher sales volume they will be able to lower the unit costs and thus achieve profit in the long run. This is essentially achieving economies of scale. The price is to be kept in that price range since it will make the product stand in competition with other soft drink and energy producing company. Coca Water has to first determine the demand of tender coconut water in UK market. According to a research, the value of health drink market rose by 1.2% in 2012 from 2011 to £ 1.820 million. Thus the demand for such products is rising. Next the company has to estimate the cost required for the production process. Based on this Coco Water has decided to set different prices for different product offerings (Saloner, Shepard and Podolny, 2008, p. 173). Coco-Natural the Price is £ 1.2 per 300ml bottle Coco- Flavour is priced at £ 1.3 per 300ml bottle Coco- Health is priced at £ 1.5 per 300ml bottle Coco-Energy is priced at £1.4 per 300ml bottle. This price is lower than its competitor’s prices who are offering similar type of products. Promotion Coco Water has to employ mass marketing by advertising through conventional media. The product must be launched by a sportsman like Steven Gerrard. This will place the product as alternative to energy drink to the sportsmen. Coco Water must use celebriti4s like Madonna and Rihanna to promote their product as super hydrating miracle drink. They must try to grow by cultivating separate slivers of beverage enthusiasts. They are individual who are more willing to choose coconut water which comes in 11-oz boxes. These boxes are a natural alternative to flavoured water, energy drinks and sports beverages. Coco Water should try to manufacture more earth friendly bottles instead of regular plastic bottles (Cole, 2003, p. 184). They must try to pack each bottle with as much potassium and electrolytes as possible which is essentially fat free. They must promote their products by using sample vans and tour the streets of important cities in UK like London and give samples of it at various places like Schools, Hospitals, Gyms, Supermarket etc. They should try to pitch the product as a hydration vacation. They should try to sponsor major events like Rugby, Football, college fest, charity programs etc. This will make their brand presence known to all age groups. They can set up their own kiosks and go for promotion at various places. Place Coco Water must aim at decentralized distribution system. This will help them in fast meeting the consumer demand in a particular area by making the product available to them quickly. This will result in low inventory turnover. They must try to establish their distribution channel initially. But as their market gets spread out, they will enter into contract with new dealers to distribute their products. Initially they must have their own kiosk present across many important places like Hospitals, schools, colleges, Gyms etc. They must try to set their own outlets in few core market locations like London, Thames etc. They will have to source their raw material from outside country like Brazil, Philippines or India. They will have their production units located in places where it can be easy to distribute to supermarkets, hospitals, schools, colleges across the country (Leader and Kyritsis, 1994, p. 273). STP Analysis Segmentation Coca Water has segmented the product on the basis of age group and profession. It is a well documented fact that tender coconut water is beneficial to all age group people. For them Coco – natural is the product which will be offered to them. For young generation youths, the company has made the product available in different flavours known as Coco-Flavour. Next the market is segmented on the basis of type of their profession. For professionals like Sportsman they will prefer to have Coco- Energy. But for professionals like actresses, actors they will like to have Coc0-Health which is for such type of individuals. Target customers Tender coconut water is beneficial to people of all ages. Consumers in UK are turning more health conscious and prefer to have natural products. This makes their product acceptable both in UK and in International markets. Their main target group is the common man walking on the streets. Secondly they also target young generation customers in the age bracket of 18-25 years of old who mostly prefer to have energy drink (Burkitt, 2009, p. 1). This helps the company in generating maximum revenue since they are the one who will be of prime target customers. Coco Water will also target sports man with their product as an energy drink since it has presence of Potassium and Calcium which will give energy to them. The target customs also include pregnant ladies for whom having tender coconut water is beneficial to them (Hogg, 2013, p. 1). Position The different brand of Coco Water is positioned differently in the market. Coco-Natural is positioned as Low price as compared to its competitors while maintaining high quality. Coco-Flavour is positioned as premium product since it is priced more than its competitors and high quality. Similarly the other two brands like Coco-Energy and Coco-Health is also priced high and since it caters to specific target segment (Beroe, 2012, p. 17). Conclusion Tender coconut industry is a rising industry as it is an appropriate substitute to many traditional forms of soft drink and energy drink industry. This report discussed about a tender coconut water company Coco Water which is opening up its first base in UK. It was found that tender coconut industry has a huge potential in the UK market though the knowledge about the product among the consumers were little. Coco Water will have for different product lines namely Coco-Natural, Coco-Health, Coco-Flavour and Coco-Energy. The company mainly targeted their products across individuals of all age group. The company priced their product accordingly with three out four products being priced at premium category. The company is trying to segmenting the product according to age group and according to the profession of individuals. Coco Water must use mass marketing across UK to make their brand presence known across UK. Through different product lines it is trying to communicate with the consumers that the company is catering to all individuals along with the health benefits which it is offering. Thus Coco Water must use this opportunity to enter into UK and gain significant market share in the soft drink industry. References Beroe. 2012. Demystifying Supply Strategy. Available at: http://www.apccsec.org/document/YTC.pdf. [Accessed on: 26 Feb. 2014] Burkitt, L. 2009. Coconut Water: A Hard Nut To Crack. Available at: http://www.forbes.com/2009/06/04/vita-coco-zico-one-leadership-cmo-network-coconutwater.html. [Accessed on: 26 Feb. 2014] Cole, G.A. 2003. Strategic Management. London: Cengage Learning EMEA Fife, B. 2007. Coconut Water for Health and Healing. New York: Piccadilly Books, Limited. Grimwood, B.E., 2001. Coconut Palm Products: Their Processing in Developing Countries. New Delhi: Food & Agriculture Org. Hogg, C.D. 2013. Coconut water: Living La Vida Coco. Available at: http://www.independent.co.uk/life-style/health-and-families/features/coconut-water-living-la-vida-coco-8805651.html. [Accessed on: 26 Feb. 2014] Leader, W.G. and Kyritsis, N. 1994. Fundamentals of Marketing. London: Nelson Thornes Saloner, G., Shepard, A. and Podolny, J. 2008. Strategic Management. New Jersey: John Wiley & Sons Appendix Questionnaire 1. What is your Gender? 2. What is your age group? 3. Have you ever heard of the drink tender coconut water? 4. Have you ever tired coconut water? 5. Do you know the benefits of tender coconut water? 6. What do you look while buying any soft drink in the market? 7. How much would you be willing to pay for standard 300 ml tender coconut water? 8. In which of the settings would you use this kind of product? Read More