Voss Artesian Water from Norway - Brand Analysis, Positioning Strategy and Promotional Strategy - Case Study Example

Name: University: Instructor: Date: Voss Artesian Water from Norway - Brand Analysis, Positioning Strategy and Promotional Strategy Introduction Voss, as mentioned by Moon, McGovern and Beyersdorfer (1), is a water company that bottles water from Norway and is considered to supply the purest drinking waters in the world. Voss products are packed in a sleek minimalist design cylindrical glass bottle and sold at an ultra-premium price. The company’s main market is the United States, especially in the on-premise locations, such a clubs, hotels and top-of-the-line restaurants. The company also focuses on off-premise channel and has continued to expand its portfolio by supplying, for instance, flavoured water. Competition in the US market is very fierce, and this has led to price wars together with reduced consumer loyalty. As a result, companies have been forced to look for other ways in order to differentiate their products in addition gain improved margins (Moon, McGovern and Beyersdorfer 5). Voss water is sourced from Iveland, Norway, which has been associated with beautiful nature and extreme sports with high mountains. The name ‘VOSS’ is used to prove that the water still is sourced from nature and not the distributor or the producer. Recently, the bottled water has become a major industry, which has gained all the legal as well as social armamentarium of the international presence and closely modelled on other industries, such as newsletters, industry associations, trade shows, and so forth. Most water producers follow the expensive beverages models so as to achieve value and hierarchy through connoisseurship as well as competition. This case study focuses on Voss Artesian Water and provides recommendations on the strategies that should be used to ensure future profit targets are met. Current Position of Voss's Brand in the USA The USA is the primary market for Voss Artesian Water, and the brand has positioned itself strongly in the on-premise locations. Besides that, Voss has recently started penetrating the off-premise locations. As mentioned by Voss World, the company has strongly positioned itself in the US market by building On-Premise distribution platforms, and as of 2007, Voss had a customer base of 10,500 customer accounts (Moon, McGovern and Beyersdorfer 6). Besides that, the company has developed a growing brand of premium water within the on-premise segment, and as a result, it is considered as the most elite water brand in the US. Between 2001 and 2006, Voss had a compound annual growth rate (CAGR) of over 82 per cent in revenues (Voss World). Although the US is experiencing a shift far from sugary and soda beverages, Beverage Marketing Corporation maintains that the bottled water has been experiencing a significant growth to an extent that it is expected to surpass the carbonated soft drinks in the in the US by 2016 (BevNET). The US market is more congested, with brands competing fiercely so as to achieve the American consumer attention. Presently, Voss has become the fastest growing brand in the U.S., especially for the premium water products. Akin to Evian, Voss has attracted the attention of trendsetters and celebrities; thus, it frames itself as the new best of the best luxurious water brand. The bottled water packaging mould was broken by Voss’ new cylindrical glass bottle. The company focuses on positioning itself in the hotel and restaurant industry and its super premium brand has enabled it successfully position itself in the US market. Furthermore, Voss awareness and image have been developed by means of a selective distribution approach that has enabled it to yield a status of luxury and profitable brand. The company’s sales have increased and its footprint in the US is still expanding. Basically, the momentum of the brand has created the need for a focused role, which may enable the brand to continue to grow in the US, which is a vital core market. According to Beverage Industry, the U.S. bottled water industry is growing because Americans are searching for better alternatives to the carbonated soft drinks. As a result, the bottled water sales have continually increased, and the sales are expected to continue growing (Beverage Industry). Developing Brand and Brand Awareness in the USA Branding as mentioned by Dolnicar, Hurlimann and Grün (325) is an important strategy utilised widely in commercial marketing with the goal of attracting more consumers by making the products look very attractive to consumers. The power of the brand is recognised both in the ‘real world’ and within the academics. Voss should try to differentiate its brand like the Evian’s brand whose differentiation is attributed to the company’s unique efforts in brand communication. In view of this, Voss could effectively differentiate its brand through unique packaging design. As suggested by Marija (39), Voss branding strategy should be rooted in the future goals associated with customers with the goal of increasing the brand awareness, generating a positive image of the brand as well as creating a brand preference and the consequent brand loyalty. Marija (39) maintains that a brand is a crucial competitive factor that results in a market leadership position. Voss should ensure that brand building is an all-time commitment so as to generate intangible outputs that can positively impact customer satisfaction, and lead to fewer customer defections, low price sensitivity, and more referrals. Ghodeswar (4) posits that customers normally value having a connection with the branded possessions as well as with the company managing and owning the brand. For this reason, Voss should ensure that its brand identity concentrates on the points of differentiation that could enable it to achieve sustainable competitive advantage. Imperatively, brand identity is about having knowledge about the firm’s business environment, competitors, and customers. Therefore, the brand identity must mirror the business strategy as well as the will of the firm to introduce programs that could help the brand meet its promise to its customers. Voss must have in-depth knowledge about the customer behaviours, beliefs, product attributes as well as competitors. To be successful, Voss must ensure that they differentiate their brand from competitors and also make sure that its brand image is well cultivated, planned, reinforced, and attentively protected. Ghodeswar (5) asserts that understanding how to develop the brand identity is the key to effective brand-building. Voss ability to present a brand identity that is distinctive, cohesive as well as relevant may generate an inclination in the market and also add value to its products. Importantly, when a company’s products face aggressive competition in the market, reputation and personality of the brand can help the firm to differentiate it from the competing products. As a result, the company can attain growth and gain customer loyalty. Brand awareness is very important because it enables the potential customers to recognise the brand. To create successful brand awareness, the company must first understand the existing competition, consumer trends as well as breakthroughs in technology. In order for Voss to keep up with competition in the US market, it must create points of parity in areas that the competitors are yet to capitalise on and simultaneously creating points of dissimilarity so as to realise a competitive advantage in a number of areas. It is important for Voss to develop and put into practice long-lasting communication strategies so as to demonstrate the value of the brand to the targeted customers. Importantly, the message must be in line with the personality and value of the brand as well as other dimensions of the brand identity. Voss can use Keller (17) model to develop a strong brand: (1) creating a suitable brand identity; (2) developing proper brand meaning by means of robust, inimitable and favourable brand associations; (3) occasioning brand responses that are accessible and positive; and (4) building a brand relationships with customers. Positional Strategies In the US market, competition is fierce due to declining prices as well as the lack of loyalty amongst the customers. As a result, companies have been forced to look for ways of differentiating their products from those of their competitors. Enhanced and flavoured are the fastest-growing segments. Some of the major competitors in the US market include brands like Evian, Perrier, Fiji as well as San Pellegrino (Moon, McGovern and Beyersdorfer 5). Furthermore, Nestlé Waters North America (NWNA) holds a 28 per cent market share followed by PepsiCo that holds 15 per cent market share (Pfeiffer 8). Coca-Cola‘s Dasani and PepsiCo‘s Aquafina hold a significant market share as compared to Voss. Pfeiffer (8) asserts that 53.6 per cent of the bottled water market in the US is controlled by the top ten brands control just 53.6% while the rest is controlled by the smaller players. The marketing area is a key function in the company since it facilitates the implementation reputable marketing department can possibly enable the company achieves a better positioning within the market, and as a result, increasing its market share and satisfying the demands, needs, and wants of the customers. As maintained by Fejza and Asllani (274) creating and implementing an effective marketing strategy is important, particularly in the bottled water marketplace. Robust brands such as Dasani and Aquafina enjoy differentiated positioning that is implemented according to the brand strategies intended for the target groups. Positioning implementation according to Janiszewska and Insch (13) leads to a certain brand image, consistent with the brand identity as well as enables the company to differentiate its brand from the competitors. It is imperative for Voss to differentiate its products in terms of performance quality, features, reliability, durability, design and style. As suggested by Chowdhury (59), companies have to communicate and define the differences and similarities between brands so as to be able to position its brand. Promotional Strategies and Actions For years Voss have preferred to depend on managerial instinct while making most of the strategic decisions, rather than investing in the market research. Furthermore, most of the Voss promotional efforts were dedicated to nurturing relationships with on-premise and top accounts decision-makers. The company has continually disregarded traditional promotional strategies, but instead, have been focussing on celebrity-driven and high-profile events to enable its brand garner positive publicity. The company promotes its brand by ensuring that it is in the right places and use events to build public relations. Without a doubt, promotional strategies are the effective way of increasing the product’s sales. For future success, Voss must ensure that companies must first segment its consumers, and ensure they use the right pricing strategies and promotional tools in order to achieve the set goals and objectives. Voss should adopt Agent-based modelling (ABM) in order to model consumer to consumer (C2C) interactions. According to Karakaya, Badur and Aytekin (3), ABM is a technique that can help the company to overcome the challenges of modelling real life status quo and handling complex human behaviour. Voss can use the ABM tool to model the complex human behaviours by testing their reactions to various promotional strategies. The tool can enable Voss to consider the consumer behaviour complexity within the social system through monitoring as well as managing psychological effects generated by the company’s promotional strategies. One of the future promotional strategies appropriate to Voss size, style, position and budget is online marketing since it provides the company with a lot of possibilities. In the future, it will be indispensable to run a business with no online presence since consumers are moving towards online consuming. For this reason, the company should introduce an online department tasked with the company’s online presence. Besides that, the company should create a brand that is clearly defined, and which represents Voss’s strengths and values s and clasp the attention of loyal consumers both offline and online (Schwarzl and Grabowska 195). Conclusion In conclusion, this case study has focussed on Voss Artesian Water and has offered recommendations on the strategies that should be used to ensure future profit targets are met. As mentioned in the paper, having promotional strategies that are consistent with the dimensions of the brand identity is important for brand-building efforts. Voss must make sure that its brand remains strong in the US market even when experiencing challenges. Besides that, positioning is crucial to Voss bearing in mind that it operates in a competitive market. Effective positional strategies can enable Voss to make informed changes to its expansion strategy with the view to competition as well as the stakeholders’ shifting expectations and needs. Works Cited Beverage Industry. U.S. Bottled water market grows 6.4 percent in 2015. 26 February 2016. 23 June 2016. . BevNET. Evian, Fiji, Perrier and the Battle for Relevance. 13 March 2015. 23 June 2016. . Chowdhury, Partha Prasad. "Key strategies and issues of positioning: A review of." American Academic & Scholarly Research Journal 5.1 (2013): 55-66. Dolnicar, Sara, Anna Hurlimann and Bettina Grün. "Branding water." Water Research 57.100 (2014): 325–338. Fejza, Ejup and Alban Asllani. "Marketing Strategies Of Bottled Water Producing Companies: The Case Of Kosovo." European Scientific Journal 9.13 (2013): 274-283. Ghodeswar, Bhimrao M. "Building brand identity in competitive markets: a conceptual mode." Journal of Product & Brand Management 17.1 (2008): 4-12. Janiszewska, Karolina and Andresa Insch. "Th e strategic importance of brand positioning in the place brand concept: elements, structure and application capabilities." Journal of International Studies 5.1 (2012): 9-19. Karakaya, Çiğdem, Bertan Badur and Can Aytekin. "Analyzing the Effectiveness of Marketing Strategies in the Presence of Word of Mouth: Agent-Based Modeling Approach." Journal of Marketing Research and Case Studies 2011 (2011): 1-17. Keller, Kevin Lane. Building Customer-Based Brand Equity: A Blueprint for Creating Strong Brands. Working Paper. Cambridge, MA: Marketing Science Institute, 2001. Marija, Jankovic. "Exploring the value of brands on the montenegrin bottled spring water market." Applied Studies in Agribusiness and Commerce 7.2-3 (2013): 39-42. Moon, Youngme E., et al. VOSS Artesian Water from Norway. Case Study. Boston, MA : Harvard Business School, 2009. Pfeiffer, Erik. Voss Water and Retail Expansion: Implications for a Luxury Brand. Thesis. Norwegian School of Economics. Bergen, Norway, 2008. Schwarzl, Susanne and Monika Grabowska. "Online marketing strategies: the future is here." Journal of International Studies 8.2 (2015): 187-196. Voss World. VOSS – Growth Story. 4 September 2012. 23 June 2016. . Wilk, Richard. "The Pure Commodity in the Age of Branding." Journal of Consumer Culture 6.3 (2006): 303-325. Read More