Cadbury Beverages Inc. - Crush Case Study

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Based on this situation of the Crush brand, the recommendation for the future strategy in the orange segment is that of investing more in the products and in their marketing in order to attract more customers. Still, this course of action would be expected to generate only a slight increase in sales, and this is due to the fact that the soft beverage market is already mature and consolidated, and major shifts are improbable.

Still, the orange sector represents a stable one, which would bring sustainable revenues. In a more specific formulation, Cadbury Beverages should recognize its orange segment as one retailing cash cow products. These products are able to generate suitable revenues, for investments which only maintain, rather then reinvent the product line. The profits generated from this segment are as such secure and the costs are lower, indicating as such, that even if the market for them does not increase, the profits would still be high.

4. Positioning of Orange Crush

Orange Crush is a stable brand, one which is trusted by both the company, as well as the consumers. It is a brand which has existed for several years within the market and has gained the approval of the customers. It is able to retain its older customers, but also to attract new ones. It is based on a combination of loyalty, as well as novelty. The children that once used to drink it within their parents' households now purchase it for their own households, for their own children.

Orange Crush is a brand for the entire family, deeply rooted in the consciousness of the American consumer. It reveals survival in time, stability and strength. It is part of the life style and part of the every day activities. People celebrate with their bottles of Orange Crush on the table and they get through their routine activities with a bottle of Orange Crush in their hands. This is the image and the statement which should be made by the marketing communications campaign and this is the position which should be created for the Orange Crush brand.

This outcome would be completed with the aid of multifaceted marketing communications campaign, which aims to attain the following objectives:

Position the Orange Crush brand in the mind of the consumers

Create awareness of the company, the brand and the products

Stimulate the desire to purchase the Orange Crush beverages

Generate an increase in the demand for the Orange Crush beverages

Attract customer trust and stimulate loyalty

Increase the popularity of the brand, as well as the popularity of the Cadbury company

Increase sales of the Orange Crush products and boost the company's financial results.

5. Marketing communications program

In order to attain the objectives mentioned above, the marketing communications program has to be complex and address as many issues as possible. As has been mentioned in section 4, the recommended strategy is that of treating the Orange Crush brand as one of cash cow products. This in turn means that the marketing communications program would not be allocated massive investments to reposition the product, but that the efforts made would focus more on the further consolidation of the current position. Still, in order to avoid redundancy and to ensure that the allocated resources are not spent without a positive result, the marketing communications program would introduce some welcomed changes in Cadbury's marketing approach.

In this order of ideas, the designed marketing communications program would include the following elements:

Advertisements created in a way to promote the position of the company and the brand, as a preferred consumer choice and a part of the American culture

The advertisement ought to be promoted on more than the three traditional channels used by the company.

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It is as such recommended that the company began to engage in more proactive internet communications. The website should be developed to become more appealing, more user-friendly and more interactive. Online advertisements should be placed on other websites as well.

Direct and indirect communications with the consumer base and the public. In this instance, the organizational leaders, marketing specialists or other company representatives should participate in open discussions, in media interviews and other such meetings in order to promote the product, but also the brand and the company's values and commitments.

The offering of promotional sales on various occasions, including volume discounts. These types of promotions on sales are generally offered by the bottlers, rather than the concentrate producer, but Cadbury Beverages should become more involved in these types of activities.

The sustained and continuous research of the market in order to identify customer needs and wants. In order to succeed, it is necessary to integrate the customer input in the product and marketing decisions.

From a financial standpoint, the marketing communications program would incur costs and sales as revealed in the table below:

1990

1991

Sales

$6,000,000

$7,000,000

Cost of goods sold

$2,000,000

$2,500,000

Expenses

Marketing

Administrative

$500,000

$300,000

$200,000

$500,000

$200,000

$300,000

Taxes

$300,000

$350,000

Net income

$3,200,000

$3,650,000

6. Conclusions

The soft beverage industry in the United States is highly concentrated and Cadbury Schweppes -- parent company of Cadbury Beverages -- is the fourth largest organization, after the Coca Cola Company, PepsiCo and Seven Up / Dr. Pepper. There are three types of industry players -- concentrate producers, bottlers and retailers. The concentrate producers create the beverage mixture based on secret recipes, then send it to either bottlers, or fountain vendors. The bottlers can be either owned by the concentrate producers, or they can be franchised; when franchised, they are allowed to bottle other beverages as well, as long as they do not compete with the products of the franchisor.

One notable modification in the soft beverage industry is represented by the increasing demand for orange flavored beverages, which creates an additional opportunity for the Crush brand from Cadbury. This increase is pegged to new product introductions by Coca Cola and PepsiCo, which stimulated an increase in consumer demand. Overall, the industry is competitive, and the final success of the company is generated by an adequate combination of marketing, operational efficiency and strong managerial models.

Cadbury Beverages is currently positioned as one of the leading companies in the industry. It has attained this position by selling products desired by the customers, but also by specializing in items which were not produced by the competition. Cadbury is for instance the leader of the industry in the tonic water segment, but it has also established strong positions in other segments.

Within the orange flavored soft beverages, the company enjoys the increased demand from consumers. It adversities specifically to teenagers and households with children and it uses a relatively simplistic marketing model, through which it most frequently markets through television, newspapers and street banners. The recommendation for this segment is that of consolidation of the current position.

Crush Orange is part of the American culture and the American life style. It has enjoyed the trust of the consumers and the positioning strategy should integrate this aspect. In terms of the marketing communications program, this would strive to attain this objective, as well as other several, such as increasing awareness, trust….....

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