Marketing Plan on "Redux Beverages LLC and Cocaine Energy Drink"
Marketing Plan 5 pages (1654 words) Sources: 1
[EXCERPT] . . . .
Redux Beverages LLC and Cocaine Energy DrinkRedux Beverages LLC is a Las Vegas-based manufacturer of 'energy drinks.' Energy drinks are rapidly overtaking soda as the beverage of choice amongst young consumers (Redux Beverages, Official Website, 2013). Redux's founder and president is James Kirby. The company is privately-owned and financials are not available for public consumption. It is a relatively small 'upstart' company and has only recently begun to challenge Red Bull and the producers of other caffeinated, bottled drinks in the market.
As is exemplified in its 'edgy' name, the company caters to young consumers, specifically to students, club-goers, and others for whom staying up for long periods of time is desirable. "The little, two-dollar-plus, red can of 'Cocaine' is an energy booster drink that can be found in convenience stores, like 7-11" and looks fairly similar to other energy drinks, except for its unusual name ("New 'Cocaine' energy drink causing controversy," ABC, 2006). Cocaine is also marketed in the form of energy 'shots,' which can be consumed by people who primarily want the high of caffeine rather than desire to actually drink a beverage.
Market/situation analysis: '5 C' analysis
Company
Cocaine is relatively new in the energy drink market, compared with its competitors Red Bull and Rock Star. It was originally released in 2006 (New 'Cocaine' energy drink causing controversy," ABC, 2006). Its name, a reference to an illegal stimulant drug, is a clear ploy to gain attention in a crowded marketplace. The company already has a substantial presence on social media via Facebook and Twitt
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Collaborators
Cocaine is distributed through an increasingly wide array of states and marketing channels -- the most recently-advertised new venue is that of New York State. Although energy drinks are sold in grocery stores as 'food,' other popular places to buy them include convenience stores like 7-11 and gas stations. These drinks are often impulse buys, bought 'when needed' and not part of a routine shopping trip, although some regular consumers of the beverages may buy them at a grocery store.
At present, this young company is still struggling for sponsorship. One recent alliance it has formed is with an alternative radio show. According to the company website, "One of our very first sponsorships, and a continuing sponsorship, is with the guys over at Morning Show Central. Cocaine Energy sponsors the show 'Uncensored Net Noise'" (Redux Beverages, Official Website, 2013). The idea of being 'uncensored' and on the cutting edge of music or talk radio fits in well with a drink that is often consumed by musicians, clubbers, and students either staying out late or coming back from a late night.
Consumers
Within the energy drink market there are a number of potential consumer profiles. People use energy drinks as a quick pick-me-up because they either do not like coffee or because they need more caffeine than the average 'cup of Joe.' Common consumers include people working very long hours (such as truck drivers); students; and club-goers. All of these persons will have a slightly different demographic profile in terms of how they buy the drink and why. Another subset is people who use the drink as performance enhancement, such as those who work out at a gym frequently. However, they all share a common feature: consumers of Cocaine obviously cannot be squeamish about the potential ethics of naming an energy drink after an illegal substance. They like the fact that the drink has a slightly 'contraband' image. While "critics have been saying its name advocates drug use, and because of that concern, some stores are pulling it off their shelves," its apparent exclusivity may be an asset amongst target users (New 'Cocaine' energy drink causing controversy," ABC, 2006).
According to reviews of the product on Amazon, a typical positive review gushed: "the first Cocaine I ever drank, I was seriously buzzed. My body was shaking and I had a numb, tingly sensation, but it felt amazing. I didn't have a ridiculous jittery energy high, but a focused high where I felt I could focus on video games for the rest of the night or write a long essay" ("Cocaine Energy Drink," Amazon.com reviews, 2013). (the reference to video games also underlines that the target demographic is disproportionately likely to be male). Naysayers said they disliked the 'cough syrup' taste and the price (although they noted it was comparable to other competitor's beverages like Rock Star and Red Bull). But the caffeine high was largely indisputable for most reviewers.
Competitors
All energy drinks, to some degree, market themselves as non-mainstream beverages, given the target demographic. The names Red Bull and Rock Star and 5-Hour Energy all suggest a certain level of stimulation beyond that of ordinary coffee and beyond what is ordinarily recommended for health. But Cocaine takes this a step beyond. Also in competition with energy drinks are more standard ways of ingesting caffeine, including coffee and soda. The closest competitor is that of Red Bull, an established energy drink that has a more mainstream image (and which sponsors a number of 'respectable' organizations, such as a soccer team). In contrast, Cocaine "promises the drinker will achieve a high, followed by a caffeine boost 15 minutes later that could last up to five hours. The drink also includes an ingredient that slightly numbs the throat, adding an oral sensation like the drug cocaine, and has caffeine content that is 350% stronger than its leading competitor, Red Bull" ("FDA finds Cocaine energy drink illegal," CADCA, 2007).
While soda consumption is down amongst the target young demographic coveted by energy drink companies (in part because of the availability of more potent substances like Red Bull and Cocaine), Redux is also seeking to encroach upon the market of soda consumers. It is test-marketing "Cocaine Black Cola, a drink with a cinnamon and cola flavor that will be sugar free and have about half the caffeine of a regular Cocaine drink or shot" (Thompson 2012:1). In contrast to regular Cocaine, which is primarily being marketed as a stimulant, this drug will be marketed as a weight loss supplement. "According to the company founder: "This new drink will have ingredients in it that studies have shown assist the body in burning calories" (Thompson 2012:2). This new beverage will enable the company to compete in several different new market segments, expanding the product's appeal to females in particular regarding its weight loss enhancement potential. Conventional cola drinkers, who would shy away from drinking full strength Cocaine might also be willing to give the drink a try.
Climate (Environment)
Unsurprisingly, government regulators and opponents of energy drinks were not pleased by Cocaine when it was first released. Although the beverage was never formally recalled, the FDA declared the beverage illegal when it was released and demanded the company reframe its marketing position in the form of a warning letter. "The FDA said the makers of the drink illegally marketed the drink as a street drug alternative and a dietary supplement….the FDA cites as evidence the drink's labeling and Web site, which include the statements 'Speed in a Can,' 'Liquid Cocaine' and 'Cocaine -- Instant Rush.' In addition, dietary supplements cannot carry claims to prevent or treat a disease -- something only drugs can do, according to the letter" ("FDA finds Cocaine energy drink illegal," CADCA, 2007). The FDA… READ MORE
Quoted Instructions for "Redux Beverages LLC and Cocaine Energy Drink" Assignment:
INTRODUCTION/COMPANY PROFILE
Write a brief paragraph here that briefly describes the company, its history, the sector in which it operates, the products it makes, etc*****¦
Company Details
*****¢ Location
*****¢ Financial Facts
*****¢ Personnel
Questions to address
*****¢ How does the company compare to its main competitors?
*****¢ What obstacles does the company face in its sector, and does the company have any innovative approaches to overcoming them
*****¢ How will the product/service fit into the competitive landscape?
MARKET/SITUATION ANALYSIS
A situation analysis is the foundation of the strategic planning process for your marketing plan. It includes an examination of both the internal factors (to identify strengths and weaknesses) and external factors (to identify opportunities and threats).
Situation analysis should include a detailed exploration of:
*****¢ The Company
The product time line, experience in the market, etc.
*****¢ Collaborators
Distributors, suppliers, and alliances. These are any companies that you work with on a day to day basis to help your company run.
*****¢ Customers
This is your whole market not simply your target segment(s). Ask yourself what benefits they are looking for. What motivates them in the purchase process? Where does the customer actually purchases your product? How the product is purchased (impulse buys, internet, etc)? Understand the quantity a customer will purchase and even trends in consumer tastes. A segmentation worksheet (available from your instructor or through Blackboard) is available.
*****¢ Competitors
Both your actual and potential competitors and those that directly or indirectly compete with you. Understand their products, positioning, market shares, strengths and weaknesses.
*****¢ Climate
Climate (or Environment) - These are governmental policies and regulations that affect the market. It is also the economic environment around your company; which is the business cycle, inflation rate, interest rates, and other macroeconomic issues. Society*****'s trends and fashions are found in the *****"climate.*****" The technological environment is creating new ways of satisfying needs (i.e. using technology to enhance the demand for existing products).
Marketing Research
In order to adequately report on the 5c*****s it will be necessary to conduct both primary and secondary research. In this section and in an appendix, report on the research you conducted and the degree to which questions remain unanswered. You will also need to include a review of any assumptions you made in drawing the conclusions and presenting the information in your overall situation analysis, customer review and competitive review.
This information can be summarized using any tools necessary or appropriate and is descriptive of the current situation facing the brand, company, industry, marketplace and economy. This may culminate in a SWOT type analysis or 5C analysis. Generally, this section is the longest single section of your Marketing Plan requiring the most thought, time, research and consideration.
POSITIONING
Based on your market research and segmentation, you should identify those characteristics of the marketplace that potential customers see as driving quality. Using these *****quality drivers***** you should evaluate the key competitors or competitor clusters and define your relation to them.
In addition, you should include discussion of:
*****¢ the dimensions that drive value in your industry
*****¢ your competitive differences
*****¢ your unique selling points
*****¢ how your marketing, situation analysis, and location will support your positioning.
How to Reference "Redux Beverages LLC and Cocaine Energy Drink" Marketing Plan in a Bibliography
“Redux Beverages LLC and Cocaine Energy Drink.” A1-TermPaper.com, 2013, https://www.a1-termpaper.com/topics/essay/redux-beverages-llc-cocaine/3767016. Accessed 4 Oct 2024.
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