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Read the case:
Provide in-depth and thorough analysis for each question (at end of case) by applying assigned readings/chapter material as much as necessary/appropriate in a way that explicitly explains in each application instance what assigned reading material was applied, how it was applied, and why.
Provide rationales (explanations) for your answers/analysis for each question at end of case that are in-depth/drill-down and very specific (not vague).
Takes a well-reasoned clear specific stand on answers/analysis for each question at end of case, avoiding a stand of "it depends."
I'll attach the additional materials.
Case Analysis 2000 words description 4 pages, Single Spacing
Please provide in-depth and thorough analysis for each question by applying chapter 6. Thanks.
Marketing Case Analysis
Marketing Case Analysis
I believe that four variables could be applied to segment 5-hour energy's market. It is essential to highlight that segmentation of the market entails the distinctive classification of the market depending on specific attributes of the customers within each particular market. The segmentation variables for the product included geographic, demographic, psychographic, and behavioral. As such, below are explanations of the different variables and how they segmented the market of the 5-hour energy drink. First, it is critical to highlight that the company targeted GNC as the first retail chain through which its marketing team would drive its product through the market. The choice of GNC is a shred of sufficient evidence for the behavioral segmentation of the market in the sense that its customers at the time were highly oriented to fitness and health matters, and sought to avoid any unwanted side effects of consuming energy drinks. The behavioral segmentation of consumer markets may be centered on the benefits derived from consuming the product as well as their status and loyalty (Kotler et al., 2013). The behavioral segmentation of the consumer markets for the product is also evidenced by the strategic discovery by Bhargava that the previous and current manufacturers of other energy drinks concentrated on the production and distribution of a range of products that provided energy and helped the consumers to stay awake. The products also triggered various nutrient conflicts in the bodies of the consumers such as the carbohydrate-induced crash into grogginess. The consumers were also required to consume substantial amounts of liquid products to generate sufficient energy in their bodies. Behavioral segmentation can be centered on the nature and type of benefits derived from the consumption of a particular product. Therefore, Bhargava saw the flaws demonstrated by the other products as a lucrative opportunity to formulate and introduce a product that covered the weak lines exhibited by the previous competitors. Therefore, he developed a sugar-free product with sufficient caffeine content which would offer adequate energy boost for the consumers. The benefits derived from the product by the consumers also included the blend of vitamins and amino acids whose primacy in boosting the focusing capabilities of the human brain cannot be overlooked (Kotler et al., 2013). Therefore, Bhargava exploited the behavioral segmentation of the consumer markets to leverage the opportunity created by the unfulfilling nature of the existing products to the consumers at the time of introducing his new 5-hour energy drink. He centered his product development strategy on the unmet needs of the consumers; implying that he had learned the desired benefits that the consumers intended to derive from consuming the product. While boosting their health and body energy positions, the consumers needed to obtain other benefits from the product such as staying focused and attentive. Therefore, the behavioral segmentation of the consumer markets served as a strategic source of competitive advantage for the business.
Demographic segmentation of the consumer markets for the 5-hour energy drink is also evident in the case study. It is essential to highlight that demographic segmentation of a consumer market can be centered on specific attributes of the consumers such as age, income, occupation, and generation among others. Imperatively, the development of the energy drink and its presentation in the market at a premium price of more than $3 through the network of GNC stores is a piece of sufficient evidence for the demographic segmentation of the consumer markets (Kotler et al., 2013). Specifically, the premium pricing of the product was a way of segmenting the consumer market based on their income levels. Low-income earners could hardly afford the product; therefore, it was focused on the affluent section of the population. Occupation is another identifiable basis of the demographic market segmentation deployed by the company in offering its product to the consumer markets. The case associates the drink with a young, hip, the white-collar worker who had been much troubled by the 2:30 sleepiness and grogginess in the office. The person concludes that the drug is an ideal solution for the 2:30 feeling; implying that it was appropriate for the working class proportion of the population (Kotler et al., 2013). The application of occupation as a demographic basis of segmenting the market is also demonstrated by the fact that Bhargava identified the need for individuals to remain focused; especially those who served in two jobs to make ends meet. It also focused on truck drivers who spent long hours behind the wheels as well as the Wall Street traders who could grind out for more than sixteen hours. Overall, the fact that all the identified working classes of individuals spent long hours at their workplaces and their jobs required substantial concentration, Bhargava sought to leverage on the market segmentation in a bid to meet their needs while driving the product through the market. The working class was exemplified by Bhargava himself when he knew that he would remain in meetings until 10 pm; therefore, he sought to consume a can of the energy drink that kept him in shape for the next six or seven hours (Kotler et al., 2013). The concept of segmenting the consumer market of the basis of occupation serves as a boost for the company's premium pricing strategy because the drink's presence in the market was a real demonstration of chance meeting opportunity; the working population needs the energy to remain focused and has the income to buy the drink.
The consumer market segmentation adopted by Bhargava in driving 5-hour energy drink through the market was also centered on the geographical concept. The geographical segmentation was pivoted on the selection of GNC as the sole marketing distributor for the product. It is evident that GNC was the largest chain of vitamin and nutrition stores in the entire country. The company also leveraged the engagement of other distribution channels such as Walgreen’s CVS and Walmart; all of which served as great drivers of the product across the entire US market (Kotler et al., 2013). Therefore, the company leveraged the opportunity of selling the product in different geographical markets in the US through the various supply chain agents engaged in delivering the drink to the consumers. The business capitalized on the fact that the selected distributors had strong client bases in the US; thus, offering a firm foundation for the company to take off.
Lifestyle and social class are typical examples of the Bhargava's decision to segment the consumer markets on a psychographic basis. Segmentation based on the variable is evidenced by the fact that the company focused on the health and fitness oriented customers. The lifestyles of such people were highly inclined to the maintenance of good health and fitness while consuming energy drinks (Kotler et al., 2013). The premium pricing strategy demonstrates social class and focuses on the working section of the consumer markets.
According to the information provided in the case, 5-hour energy is using the micromarketing strategy to target the specific market segments. The strategic approach to market targeting entails the customizing the products and marketing programs of an entity to the specific needs of the clients and local customer segments. The concept can be divided into local and individual marketing. Imperatively, utilization of the strategy by 5-hour energy drink is centered on the market opportunity identified by Bhargava before developing the product. The existence of an unfulfilled customer significantly informed the establishment of the business by Bhargava; on who the entrepreneur leveraged to develop a product that would lead to sustainable consumer fulfillment (Kotler et al., 2013). Bhargava discovered that the existing drinks were focused on energy generation and keeping individuals awake. However, the consumers were required to consume too much of them to generate sufficient energy, and they had too much sugar. As such, he ventured into the development of sugar-free drink with sufficient caffeine levels as well as nutrients such as vitamins and amino acids. The company demonstrated the local marketing aspect of micromarketing by identifying the needs and wants of the local customers. 5-hour energy was centered on the aim to generate sufficient energy, maintain the consumers’ health, and maintain their focus (Kotler et al., 2013). Therefore, the ingredients of the product ensured that the 5-hour energy drink specifically met the needs of the customers that were unfulfilled by the previous brands of energy drinks. The individual marketing aspect of micromarketing was also evidenced by the business’ concentration on the customers characterized by substantial health and fitness consciousness. Through micromarketing, 5-Hour Energy successfully meets the needs of the different consumer market segments in which it operates across the country. Overall, the deployment of micromarketing strategy by the company in the production and marketing of the energy drink was evidenced by the high acknowledgment of the previously unmet consumer needs and focusing on meeting them through the design of 5-hour energy drink.
A robust positioning statement serves as a communication tool for the specific ways through which a particular product, service, or brand will serve a specific client need in a unique way that its competitors do not achieve. The positioning statement of 5-hour can be centered on the strategic advantages that it demonstrates above its competing brands (Kotler et al., 2013). For instance, the brand does not contain any sugar; it has minimal caffeine levels and is laced with high energy levels such that consumers do not need to consume it in large volumes to gain the desired levels of energy. As such, the positioning statement for 5-hour energy drink can be crafted as follows: "5-Hour Energy: redefining energy drinking." Justification for the positioning statement is evidenced by the fact that the competitors of 5-Hour Energy had failed to fulfill the needs of the consumer; thus, 5-Hour Energy identified and exploited the market opportunity by developing a great product that met the previously unmet consumer needs.
Challenges are inevitable experiences for all business establishments despite the adoption of dynamic and robust competitive strategies in product development and offering. As such, 5-Hour Energy could be faced with substantial challenges in the future. First, 5-Hour energy could be faced with strong competition which would threaten its position in the market. The inevitability of competition as a future challenge for the company is centered on the fact that there exist other potential competitors in the energy drink industry. Other players such as Red Bull, Monster, and Pepsi, among others pose a substantial threat to the business in the future; given that they may realize the unmet consumer needs of the past and develop competing products for 5-Hour Energy. The competition would be aggravated by the adoption of low-pricing strategies by the competitors. According to the case, the premium pricing strategy adopted by 5-Hour Energy is a potential threat for its existence in the market because many customers would be unwilling to pay $3 twice (Kotler et al., 2013). On the other hand, if competitors develop similar products and offer them at reduced prices, the existence of 5-Hour Energy in the market would be significantly threatened because the customers would prefer affordable products.
The evolution of consumer needs would also challenge 5-Hour Energy; a phenomenon that would lower the demand of the product significantly in the different consumer markets. While the current consumers in its market prefer sugar-free and high-energy drinks, it is not sufficiently guaranteed that future consumers may demand such products. Therefore, the energy drink may be driven out of the market; thus, compelling the business to go back to scratch to formulate a new product that matches the consumer needs. It may also face challenges in its efforts to expand into new markets; especially where the consumers require sugar-laced energy drinks. In such a market, the 5-Hour Energy product would be irrelevant to the consumers. As such, the company would be highly challenged by other competitors offering such products. The problem will be aggravated by the fact that the business has not diversified its production. 5-Hour Energy operates in a single product; a phenomenon which exposes it to a substantial threat of being pushed out of the market if the only product is no longer demanded. Overall, the business faces significant sustainability challenges in the future; all of which are centered on its product development and marketing strategies.
Kotler, P., Burton, S., Deans, K., Brown, L., & Armstrong, G. (2013). Marketing. Frenchs Forest, N.S.W.: Pearson Australia.
[Solved] Marketing case analysis
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- Submitted On 17 Mar, 2021 04:21:44
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