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Identifying an Existing Product
Sunkist has been around for more than 100 years. At the beginning citrus fruit growers in California and Arizona instituted the Sunkist trademark as a mark of freshness and premium flavour. In 1978 it was licensed and in 1979 it was launched. By 1986 Cadbury Schweppes acquired the Sunkist license and expanded the brand.
Sunkist is now one of the most popular soft drinks around the world. Its purpose is to bring a great flavour of orange and provide everyone with a drink bursting with quality, as well as a drink that satisfies customer needs.
Cadbury merged with the company Schweppes to form Cadbury Schweppes in 1969. It acquired many drinks including Sunkist. In 2008 Cadbury Schweppes split up their operations to create a separate American Beverage unit, which was renamed the Dr Pepper Snapple Group. In 2009 the confectionary and beverages business of Cadbury Schweppes Pty Ltd. in Australia was formally separated and began operating as Schweppes Australia Pty Ltd.
Schweppes Australia provides good quality products that consumers will enjoy and maintain a good well being. This is done by labelling clearly what is in the products and intake information on packaging. An increased variety of choice is provided and continuous exploitation of consumer needs and preferences is being included to provide customers a drink with great taste, quality and truthful beverages.
Target Market and features
After many years of the existence of Sunkist, and even though a range of ages have the access to the beverage, its core target market is aimed at trend savvy teens and young adults who are mobile, live online and love music. Sunkist aims to attract customers by its colourful designs on the bottles or cans and the brightness of its colour. In most parts of the world Sunkist now comes in different flavours. Sunkist aims to ‘Stimulate the senses' which are citrus. It provides people with a great taste, quality and purity, and varies in shape in different parts of the world.
Beverages are main products in the market place that are commonly purchased. Sunkist is a great drink although similar beverages such as fanta, orange crush etc. or even other beverages such as coca-cola, mineral water, ice tea etc. all compete against each other to attract consumers to purchase their products. For this reason Sunkist is using different strategies to provide customers with a great taste and quality which will increase customer awareness and satisfaction to increase its market share. This marketing concept will be achieved by always updating the product to suite customer needs and advertising its great features.
Product Life Cycle
Sunkist is now in the maturity stage of the product life cycle as its product features are continued to be enhanced to differ from competitors, its pricing is not high, its distribution is intensive and it offers incentives as well as emphasizes product differentiation.
- High brand awareness in big cities
- High quality product.
- Good customer service.
- Provides a strong marketing and promotional service to other fruit producers.
- Large scale of operations.
- Good reputation.
- Offers promotions.
- Strong brand recognition.
- Leading brand value.
- Long-life brand
- Don't spend much on advertising products.
- Didn't introduce different flavours to all countries.
- Low market share.
- Low market coverage
- Limited bottles network
- Low ad and promotion expenditures
- Competitors are cheaper.
- Other drinks are more appealing to customers.
- Competitors have celebrities advertising products
- New drinks are still coming into the market.
- Prices of other drinks are cheaper.
- Unplanned soft drink purchase
- New product launch.
- Greater promotional strategies.
- Introduce new flavour to different countries.
- Increase in spending.
Propose a Marketing Mix
Businesses have to focus on a certain group of consumers to aim their products at as customers needs vary in the marketplace. Schweppes offers many types of beverages, and by using market segmentation different beverages are aimed at different consumers, for example, Sunkist is aimed at teenagers. Market segmentation helps businesses break down the market to study specific needs and produce products that satisfy each specific group of consumers. Sunkist is strongly differentiated from other beverages due to its quality, range of flavours, and long-lasting bubbles...Schweppervescense.
A product is a final good or service. The core product is the benefits the product offers to customer purchase the product rather than from competitors. Businesses offer tangible and intangible benefits to their customers to purchase their products. Sunkist is a type of product that offers this. Its tangible benefits include its design, colour and features, and its intangible benefits include Schweppes' good reputation, image and customer satisfaction. It is important when developing marketing strategies that businesses consider:
- Positioning= this refers to a perception or image that potential buyers have of a product compared with its competitors. Sunkist and Schweppes are well known around the world and are known for high quality, reliable and satisfying beverages. Products are positioned in terms of price and quality and this attracts customers to choose what products they want to purchase.
- Branding= a brand is a tool a business uses to differentiate from its competitors. The Schweppes brand is the number one mixer brand nationally in terms of volume and value. The Schweppes logo is known worldwide and the Sunkist symbol is identifiable by many customers (see figure below). This is important for a business as the customers rely on the products being purchased as good value for good price and customer satisfaction develops.
- Packaging= this refers to information available to identify the product/brand and catch customers attention to keep it competitive. Packaging is very important for a product and attracts different target markets to the product. Sunkist is packaged in cans and bottles that are recyclable and provide nutritional information that should be known such as dangers, ingredients etc. the cans and bottles are packaged in boxes that protect them while being distributed to stores around the world. They are placed in boxes in reasonable numbers so that it is easy for customers to carry when they purchase the product.
Price is the payment required to purchase a product. It involved methods, strategies and the interaction of price and quality.
- Price methods= the pricing method used to sell Sunkist is cost. As Schweppes charges the same to all businesses, they want to get back what they paid for the product and add the profit they want to gain from selling the product.
- Pricing strategies= the pricing strategies used to sell Sunkist are prestige pricing, penetration pricing and price points. Prestige pricing is the customer's perception of the product that will influence them to pay the price for the product. For example, since Schweppes is a nationally known brand and its products are trustworthy, customers are willing to pay a high price for drinks like Sunkist as they know they will be satisfied. Penetration pricing is where businesses lower prices to attract customers to their business instead of it competitors. This is not always used by businesses; Sunkist drinks are sometimes put on sale for a limited time, when businesses went to increase their business share.Â Price points are a psychological strategy to influence customers to purchase the product. Many businesses charge for example $2.99 for a bottle of Sunkist instead of $3. This makes customers think they are purchasing the product for a cheaper price by really aren't.
- Price and quality interaction= price and quality are very important for a product. They interact as a product that is seen as high price is of high quality. This is seen in the selling of Sunkist as it is sold for a higher price than other orange drinks, so consumers recognise that it is of high quality. Sometimes products may not be of good quality but for a high price but consumers tend to think they are.
Promotion is effective communication with customers. Schweppes and Sunkist promote their products through advertising. This is paid communication and is used to persuade customers. Advertising is through TV commercials, billboards, newspapers and store catalogues.
Sunkist also offers below-the-line promotions. On their bottles, they have competitions that customers can enter to win prizes such as trips, money, t-shirts or vehicles. They also offer special offers in store every once in a while to remind customers of their products.
Another important promotion used is the communication process. Sunkist uses saturation advertising by advertising to the public as everyone knows the high quality, great taste and trustworthy beverage, and will appeal to a target market.
Also word of mouth is common and helpful. By teenagers seeing their friends holding the drink it makes them want it as teenagers have a major influence on each other.
Place refers to the distribution process. It is important for businesses to make sure that customers receive their products. Schweppes uses direct channels also known as intermediaries, to distribute their products. Retail stores are an example of this, where the product is bought from the business by the final consumer. Stores that sell Sunkist include Woolworths, Franklins, Coles, supermarkets, fast food outlets, vending machines and many more. This way it is easier for consumers to purchase the product.
Distribution intensity refers to the number of places the business sells its products to. This influences the types of consumers purchasing the product and allows businesses to control where their products and being sold. Sunkist is intensively distributed. As Schweppes is a nationally known company and has existed for a while, Sunkist is distributed around the world.
Physical distribution is about a small amount of resources to achieve business goals. There are several issues that need to be considered when distributing the product:
- Transport= this involves moving the product from one location to another. This can be expensive and should be considered when pricing the product, although it is an easy way to distribute the product.
- Warehousing= this involves storing goods before they are sold. Businesses like to purchase goods in bulk so they don't have to keep asking for goods all the time. This is good if products are easily sold and profit is made out of their selling. This can reduce costs as bulk items are cheaper than single. This can work for businesses selling Sunkist ad it is a known product purchased by many.
- Inventory= this involves storing products in case customers want to purchase it. There must be sufficient stock/inventory to satisfy customer demand, but if businesses over stock and don't sell it all, they will be losing profit and this is not good for a business.
Businesses need to also consider the environmental effects of distribution. This refers to the external environment and how it impacts distribution.
- Technology- advances in technology has helped businesses distribute their products. People are becoming more aware of products through internet technology and e-commerce is one development that allowed customers to purchase goods online.
- Government= local government are responsible for their local areas. Government regulations affect business activities, for example, zoning. This makes it hard for distribute products to some stores as there are some areas where a truck can't stop or there is no room making it harder for products such as Sunkist to be distributed to stores.