Research Problem Evaluation
As specified in the case study, Crescent Pure is the newest acquisition of a non-alcoholic drink company Portland Drake Beverage. It is a functioning beverage, that can be positioned as sports or an energy one, with different marketing strategies being possible depending on the case. Having recently acquired Crescent Pure, the PDB management is looking for the appropriate ways of incorporating the new product into its branding. The company specializes in the production of non-alcoholic beverages and is one of the largest manufacturers and retailers in the field on a national scale. In particular, it is known for producing all-natural and healthier forms of functioning beverages, as well as low-calorie non-alcoholic drinks.
PDB has conducted market research to indicate the state of the market as well as existing strengths, weaknesses, opportunities and threats for energy drinks and sports drinks. The existing research problem aims to determine whether Crescent Pure should be positioned as an energy drink or a sports drink.
In order to critique the presented research question, one must first re-emphasize the importance of the product positioning within the marketing strategy a firm designs for said product. It is a form of specific marketing designed to highlight and present a product’s selling points and unique advantages to a pre-identified target audience. Positioning determines the brand image that is going to be attached to a product, which in turn has a significant effect on its intended competitors and customers. It is thus an essential component of a modern marketing strategy, affecting aspects such as advertising, packaging, and future product partnerships. However, the bivariate approach exhibited by PDB in its marketing research has been largely limiting to Crescent Pure’s full market potential.
For the purposes of designing a clear marketing strategy within the time constraints, PDB has developed two potential roots for Crescent Pure to undertake, with the research aiming solely to identify which root provides more opportunities. The roots outlined were, as already stated, the energy drinks market and the sports drink market. These two fields within the non-alcoholic beverage industry are vastly different in their target audiences, levels of market saturation and general public perception.
From the case study, however, it is evident that the researcher was unable to go into detail about the opportunities and general characteristics of an energy drink brand positioning for Crescent Pure. It acknowledges the gap of a healthier energy drink Crescent Pure might occupy, emphasizing its organic origin and low levels of chemicals involved in the formula. However, the presented overview of the energy drink industry lacks contextual elaboration and depth, focusing exclusively on numbers obtained through various third-party sources (Fisher and Kordupleski, 2018). Meanwhile, the industry has many contradictions, which must be accounted for, and yet continues to bloom.
Energy drinks are generally perceived as unhealthy and biologically taxing for a consumer’s body. In many countries, they are not being sold to customers under 18, despite there being no formal regulation prohibiting the trade, and the decision relying on a store’s discretion. Nevertheless, the industry has exploded in the last few years, with North American customers consuming the largest amounts of energy drinks worldwide (Higgings, Babu, Deuster & Shearer, 2018). The field is known for its continuous diversifications, with the known corporate names, such as Monster and Razor releasing new flavors on the regular basis.
It is well-known that the majority of energy drinks provide their boosting effect due to the high caffeine percentage and are therefore not recommended for frequent consumption by medical professionals. To counter this unfavorable tendency, companies put an emphasis on marketing new flavors to distance their products from an image of borderline drug-like, harmful concentrated stimulators.
The research acknowledges the potential that Crescent Pure might gain within the energy drink market as a healthier solution. It also addresses the high levels of established competition in the market, labeling it as difficult to penetrate. However, as stated above, it does not account sufficiently for the controversial market characteristics, and the opportunities and threats they present for choosing this brand positioning for Crescent Pure. To specify, establishing the drink as a healthier alternative might attract a new target audience to purchasing energy drinks while discouraging some of the existing target audience (Sung, Vanman and Hartley, 2019).
Industry-specific marketing profile suggests that while the unhealthy reputation of energy drinks creates negative publicity for the beverages, a segment of the target audience finds it appealing (Buchanan, Kelly & Yeatman, 2017). Nevertheless, Crescent Pure could be potentially positioned as a profitable energy drink considering the current industry trends of the increased popularity of plant-based ingredients and other natural stimuli.
The sports drink positioning section also provides an overview of the industry size, main competitors and basic SWOT analysis, without elaborating on the existing trends in any detailed way. It is a factually correct, but surface-level analysis that glosses over multiple existing opportunities and hidden patterns in the field. Namely, a sports beverage is characterized by a somewhat unique selling point that combines hydration and stimulation purposes (Cordrey, Keim, Milanaik and Adesman, 2018). Branding Crescent Pure as a sports drink would put it alongside the established brands, such as Powerade and Gatorade.
Due to a smaller and more specific target market consisting of the members of the athlete community, Crescent Pure might experience difficulties if presented as a sports beverage (van Esch and Gadsby, 2019). The study acknowledges these difficulties, but, once again, in passing. The general surface level of the research, as well as the unnecessarily specific research question, can be identified as the main areas of criticism so far.
As the case study itself suggests, the research question could benefit from picking a broader category for Crescent Pure to fit into. Since the drink can be positioned within the two overlappings, but distinctly different markets, its product characteristics are wider than both energy and sports drink markets is requiring. The organic beverage brand positioning is innovative, and could thus easily entice consumers’ interest (Shams, Brown and Alpert, 2020). Additionally, it would have aided the PDB in gaining an access to a wider target audience, since the industry of healthy and organic foods and drinks is currently on the rise.
The current research question as it is lacks the consideration for the grand picture of the state of the foods and drinks manufacturing and retail in the country. The following section elaborates on the perceived imperfections of the research design and method, as well as the potential alternatives for a market research process in the future.
Design & Method Critique
The initial issue with the presented market research design is stated in the case study itself, with the paper referencing its time constraints and reliance on third-party sources exclusively. A PDB executive has gathered their data on the industry state for energy drinks and sports drinks based on the secondary market research exclusively. The concept of secondary market research refers to studies conducted by other researchers, which an executive uses for the purposes of their project. It is generally a quicker and less resource-demanding way of gathering information, however, is also a less reliable one (Garret & Wringley, 2019).
Secondary market research is sometimes subject to scrutiny since by using it a researcher cannot personally control whether the sampling, data processing and other relevant procedures were held appropriately. Hence, the data presented in the secondary research is by definition less reliable than the one obtained via primary research, provided the proper scientific procedures were followed. Meanwhile, by conducting the field research a PDB agent would have been able to acquire highly specific information from the regular consumers of energy drinks, sports drinks, organic drinks and Crescent Pure itself.
Secondly, the case study comments on using three focus groups while conducting the market research for Crescent Pure: women aged between 25 and 33, men aged between 25 and 35, and men aged between 18 and 24. The use of a focus group is a marketing research technique that allows the company to test a particular audience’s reaction to their product. The audience in question is usually part of the target market, and thus multiple stages of the focus group research might be required if a company changes its marketing strategy (Barbour, 2018).
The focus group research was carried out after the initial secondary market research after the head of PDB contacted retailers in relation to a product’s sales. Yet, it still lacks the full potential of data representativity such analysis might provide, with both gender and age demographics of the groups. The greater number of diversified focus groups would aid PDB in finalizing their Crescent Pure positioning decision since target markets for sports drinks, energy drinks and organic drinks differ vastly.
The case study lacks precise information on the sampling methods used within the research, other than the fact that the respondents have consumed the drinks in question. As a market study, the project does not need to follow the simple random sampling guidelines, with the required unifying characteristic being already met. However, the commentary on the time constraints somewhat decreases the credibility of the findings. The proper market research for the introduction of new products includes a combination of primary and secondary market studies, several focus group tastings and feedback collection through multiple channels.
Recommendations
The overall quality of the market research depicted in the study is relatively low, however, it does improve towards the end of the paper. The use of focus groups is a form of primary market research, which the firm needs to provide stakeholders with credible information on the consumers’ end (Guest et al, 2017). Generally, the firm would benefit from interviewing and surveying the different parties involved in the production of the drink. By requesting the information from the Crescent Pure suppliers, PDB would learn more about the prior product management of the drink and gain insights into the opportunities for its future marketing. PDB could also conduct a similarly structured but more detailed research for the organic drinks market, which caters to a demographically different audience compared to energy drinks and sports drinks.
References
Barbour, R., 2018. Doing Focus Groups. SAGE Publications, Incorporated.
Buchanan, L., Kelly, B. and Yeatman, H., 2017. Exposure to digital marketing enhances young adults’ interest in energy drinks: An exploratory investigation. PloS one, 12(2). Web.
Cordrey, K., Keim, S., Milanaik, R. and Adesman, A., 2018. Adolescent Consumption of Sports Drinks. Pediatrics, 141(6), p.e20172784.
Fisher, N. and Kordupleski, R., 2018. Good and bad market research: A critical review of Net Promoter Score. Applied Stochastic Models in Business and Industry, 35(1), pp.138-151.
Garrett, A. and Wrigley, C., 2019. Navigating market opportunity: traditional market research and deep customer insight methods. Qualitative Market Research: An International Journal., 22(3), pp. 456-471. Web.
Guest, G., Namey, E., Taylor, J., Eley, N. and McKenna, K., 2017. Comparing focus groups and individual interviews: findings from a randomized study. International Journal of Social Research Methodology, 20(6), pp.693-708.
Higgins, J.P., Babu, K., Deuster, P.A. and Shearer, J., 2018. Energy drinks: A contemporary issues paper. Current sports medicine reports, 17(2), pp.65-72. Web.
Shams, R., Brown, M. and Alpert, F., 2020. A Model and Empirical Test of Evolving Consumer Perceived Brand Innovativeness and its two-way Relationship with Consumer Perceived Product Innovativeness. Australasian Marketing Journal, 28(4), pp.171-180.
Sung, B., Vanman, E. and Hartley, N., 2019. Interest, But Not Liking, Drives Consumer Preference toward Novelty. Australasian Marketing Journal, 27(4), pp.242-248.
van Esch, P. and Gadsby, C., 2019. Marketing the Healthiness of Sports Drinks: From Physiological to Cognitive Based Benefits. Australasian Marketing Journal, 27(3), pp.179-186.