ContentsExecutive Summary.....................................................................................................................................3

Key Decision................................................................................................................................................4

Problems/Opportunity................................................................................................................................4

Stakeholder.................................................................................................................................................4

Decision Criteria..........................................................................................................................................5

Internal Analysis..........................................................................................................................................5

Strengths...........................................................................................................................................5

Weaknesses.......................................................................................................................................6

Current Financial Position............................................................................................................................6

Current Marketing Strategy.........................................................................................................................7

Current Marketing Mix................................................................................................................................7

External Analysis:.........................................................................................................................................8

Opportunities:...................................................................................................................................8

Threats:..............................................................................................................................................8

Consumer Behavious:..................................................................................................................................8

Competitor Analysis....................................................................................................................................9

Alternative Marketing Strategies.................................................................................................................9

Recommendation......................................................................................................................................10

Implementation Plan:................................................................................................................................10

Target Market............................................................................................................................................10

Positioning.................................................................................................................................................11

Marketing Mix...........................................................................................................................................11

Product..............................................................................................................................................11

Price...................................................................................................................................................12

Place..................................................................................................................................................12

Promotion..........................................................................................................................................13

Expected Results........................................................................................................................................13

Appendices................................................................................................................................................14

Appendix A:...............................................................................................................................................14

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Appendix B:...............................................................................................................................................15

Executive Summary

Want Beverages is a business owned and operated by Bill and Angela Moffat alongside

their Spellbound business, that sells energy drinks to young action sports consumers in Canada.

They are faced with the challenge of defining their distribution intensity within their financial

constraints, such that their product is convenient and available to their consumers and

increases brand awareness among their target market. Want has a differentiated product that

is promoted effectively to its niche market, but lacks the external financing and human

resources required to achieve a desired level of profitability and brand awareness. The

company is faced with negative retained earnings and struggles to succeed in the rapidly

growing, highly competitive energy drink industry dominated by Redbull. Want must develop a

defined marketing plan in order to attract potential equity investors or lenders.

Want must redefine its distribution to selective intensity, focusing only on non-

traditional retailers like West 49, and specific convenience stores located in close proximity to

their target market. This strategy ensures the company increases sales, maintains flexible

inventory and promotes brand awareness within its target market. Want will be positioned

based on its key product attributes of taste, design, and packaging. Its value-based pricing

strategy will be a benefit for the price-sensitive target market, since Want is priced at a lower

level relative to its competition. The company will remain with its current manufacturer in

order to achieve maximum flexibility in its ordering and inventory levels. Want will maintain its

socially responsible promotions, with the addition of hiring 5 sales representatives to further

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increase its brand awareness. Based on the implementation of this marketing strategy, Want

can expect to attain a profit of $33,795 by the end of its second year of operations.

Key Decision

Want Beverages is currently facing a problem of defining their distribution channels

within their financial constraints, such that their product is convenient and available to their

consumers while promoting brand awareness for their target market.

Problems/Opportunity

The Moffats hope to see Want become a profitable and reputable business in the near

future alongside Spellbound. A lack of financial resources has severely limited the growth

potential of the company. Securing financing arrangements is imperative for Want to increase

brand preference and see profitability in the near future. Their current marketing plan must be

altered in order for the company to look attractive to potential investors or lenders.

Stakeholder

The most important stakeholders are Bill and Angela Moffat. They have invested a

significant amount of time and personal savings into Want beverages. They want to build a

business that is strong and profitable on a long-term basis. Thus, if Want is successful, they can

benefit from the profits earned and success of the business. In contrast, the Moffats could lose

considerable amounts of money and time if the company fails to become profitable.

Bill and Angela also face the risk of having two unprofitable businesses by ineffectively

managing both Want and Spellbound. It is possible that they may prioritize a substantial

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amount of effort and resources to stabilize Want, while disregarding their focus and

responsibilities in operating Spellbound. This could prove to be an underlying downfall because

if Want ultimately fails after concentrating their effort for growth, the Moffats could suffer with

two unstable businesses.

Decision Criteria

1. Increasing sales to a level that ensures long-term success

2. Maintaining flexible production capacity and inventory levels

3. Increasing brand awareness among target market

4. Stay aligned with goals of corporate social responsibility

Internal Analysis:

Strengths

Want successfully differentiates itself from its competitors through features such as

taste, design, and packaging. Want’s relationship with its bottle manufacturer is an intangible

benefit. They provide Want with the opportunity to produce low volume quantities, given their

current cash flow situation, and allow flexible scheduling resulting in shorter lead time. Want

has built a socially responsible image by its charitable donations to action sports in local

communities; an activity that no other energy drink competitors offer. Another strength is the

Moffats experience with their target market and background in marketing and distribution,

which was developed through their business with Spellbound. This advantage has helped their

product gain access to markets across Canada and provides Want beverages with the

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opportunity to be marketed effectively and profitably.

Weaknesses

Want’s weaknesses are in its lack of financial and human resources. The Moffats are

operating at a highly inefficient level as they frequently market and promote the Want product

entirely by themselves as opposed to hiring additional sales staff. This in turn takes away from

their ability to focus efforts on certain aspects of the business that ensure growth. The

company also faces a weakness in their inability to secure financing from external sources. It is

this factor, along with their limited sales, that affects Want’s ability to meet the credit terms

that their retailers or manufacturers require and further limits their opportunity for growth. In

addition, Want’s capacity issues can restrict potential profits that they can make from

increasing demand.

Current Financial Position

Current financial results show the firm having negative retained earnings of $33,304

making it extremely difficult to attract any investors. Failure to maintain adequate inventory

levels to meet demand along with cash flow problems have put the firm in a very compromising

financial position.

Current Marketing Strategy

Want is currently using a concentrated segmentation strategy where they are targeting a

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young Canadian, action sports crowd aged 14-24 years old. They have positioned their product

as low priced, providing buyers with a distinctive taste and a unique bottle design that is

convenient for sports; a competitive advantage that its competitors do not offer.

Current Marketing Mix

Want offers an energy drink product that provides the consumer with an alternative to

the “mediciney” taste that is present in many competitors products. The Want beverage offers

a re-sealable plastic bottle unlike the traditional cans sold by their competitors, the consumer

does not have to consume the whole drink in one sitting. In terms of pricing, they are

implementing a value-based pricing strategy due to the low price value that they have on their

product compared to their competitors, especially in the bar scene. To distribute their product,

Want uses an intensive distribution strategy to get their product into as many outlets as

possible, specifically in most action sports outlets and convenient stores. For promotions, Want

promotes its corporate social responsibility by offering 15 cents of bottle sales to local

skateparks, snowboard hills and bmx trails for each bottle sold. They are also sponsoring local

up-and-coming athletes and use tabletop refrigerators to promote their product image.

Furthermore, they promote their brand though bar and nightclub promotions where they give

out sample shots of vodka with their energy drink, as well as sponsoring sporting events.

External Analysis:

Opportunities

The energy drink industry is a rapidly growing market with a present value of $653

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million in the U.S. (approximately $65 million in Canada). This is a fairly strong indicator of

potential profitability if Want can increase its market share. As Want’s brand awareness and

market share increase, the company also faces the opportunity to change manufacturers which

would significantly improve their margins, yet require larger order sizes and the potential to

ruin the current relationship with their manufacturer. The company also has the opportunity to

increase the depth of their Want product line to include electrolyte drinks and iced tea.

Threats

The highly competitive energy drink industry is a major threat towards the potential

success of Want. Another threat facing Want is its ability to maintain the inventory levels and

displays of Want beverages at its retail locations. The company’s limited human resources has

made it difficult to ensure that their product is properly presented and restocked by its

retailers.

Consumer Behavior

Want currently targets the 14 to 24 year old Canadian action sports crowd. This is a

substantial market because the average teenager purchases 24 beverages per month. Many

consumers of energy drinks encompass habitual buying behaviour, while brand conscious

consumers exhibit variety-seeking behaviour. Want satisfies the needs of its variety-seeking

consumer segment because of its unique product differentiation from its competitors.

Competitor Analysis

One of Want’s main competitors in the energy drink market is Redbull who is the market

leader with a 60% market share. Other competitors that have entered this industry include

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Coca-Cola, Rockstar, AriZona and PepsiCo. Given Want’s company size and scale of operations,

it would be very difficult for them to compete with their larger sized competitors for market

share because most of them have an established presence in the market in terms of their brand

awareness and leadership. Furthermore, Want’s competitors have more capital to spend on

advertising and the type of efficient intensive distribution channel to distribute the product to

as many outlet as possible for higher profits.

Alternative Marketing Strategies

1. Selectively distribute Want to non-traditional retailers and convenience stores located in

close proximity to their target market. This distribution strategy effectively reaches their

concentrated market and limits the competition because of its exclusivity in non-traditional

outlets such as West 49. Sales volume may be limited because it will not be intensively

distributed throughout Canada.

2. Intensively distribute Want to non-traditional retailers, convenience stores and bars. This

distribution strategy maximizes their product availability and sales volume, but it is not feasible

given their limited resources and financial instability.

3. Exclusively distribute Want to non-traditional retailers, convenience stores or bars. This

type of strategy will grant West 49 and a few other retail stores exclusive rights to sell Want

beverages, but extremely limits the availability of the product. (An in-depth evaluation of

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marketing alternatives can be found in Appendix A.)

Recommendation

After an evaluation of Want’s feasible marketing alternatives, the logical solution I to

selectively distribute their product to non-traditional retailers, as well as convenience stores

located in areas that are highly populated with their target market segment. This distribution

strategy ensures that sales will increase to a level that sustains long-term profitability. With this

solution, brand awareness will increase as it will be exclusively marketed towards Want’s target

segment and there will not be as much direct competition in non-traditional retail outlets as

there are in traditional outlets. The success of this marketing plan is contingent on obtaining

external financing from an equity investor, which is reasonable to assume given the profitability

of implementing this strategy.

Implementation Plan:

Target Market

It is recommend that Want continues using the concentrated segmentation strategy in

Canada where its target market is around the age of 14-24 years old, and have an interest in

action sports. Users are primarily the action sports crowd who want convenience, a unique

taste in their beverage, and energy that is needed in the type of sports they partake in. By

distributing Want to non-traditional stores and convenience stores near the target market,

Want beverages will be more reachable and responsive to its consumers. In addition, it would

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make Want a product that will be substantial and profitable in the future because of the loyalty

that is built through repeat customers.

Positioning

Want Beverages will continue to position itself as a unique tasting energy drink, which

attracts the young action sports crowd. It will continue to emphasize its key product attribute

of taste, which differentiates from the “mediciney” taste relative to its competitors.

Furthermore, Want should communicate that its resealable bottle is much more practical for

the action sports crowd than traditional cans. These two attributes will allow Want to be

preferred since these are features that its competitors do not offer and are desired by WANTs

target market.

Marketing Mix

Product

Want should continue to use its unique product design and resealable packaging as a

competitive advantage. The traditional Berry, Lemonade, and Lemonade Lite beverages will

remain in the Want product line, with the bottled water dropped. This product does not fit the

core positioning of the brand, is difficult to differentiate, and provides smaller margins than

other Want products.

Price

Want should continue to price its product at a lower price than the market leader

Redbull. This value-based pricing strategy will give Want point-of-purchase attention at its non-

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traditional retailers, and look attractive compared to its higher priced competitors at

convenience stores. The target consumers generally fall into the category of lower income

earners (under $30,000 per year) which implies they are price-sensitive for convenience goods

such as energy drinks.

Place

Want should selectively distribute its product to non-traditional retailers such as West

49, as well as convenience stores located in close proximity to areas that are highly populated

by its targeted consumers. The concentrated distribution strategy allows the company to have

greater control over its product inventory and product displays at its selected retailers. This

strategy ensures the company will have the necessary production capacity to meet demand

since it will only be distributing to a limited selection of retailers. Want will remain with its

current manufacturer because of their order flexibility, as well as the capacity constraint of

6,000 cases in the new Want warehouse. Want should continue to use direct distribution to its

retailers, an advantage they have gained with West 49 because of the Moffats’ connection with

Spellbound.

Promotion

Want should discontinue bar promotions due to Redbull securing such a significant

proportion of that market. The expenses associated with the bar promotion far outweigh the

benefits derived from them and proceeding with this type of promotion will further decrease

the current cash flow. Instead, Want should hire five additional full time sales staff to target

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customers with a high degree of personal selling. They will be paid on a mixed salary plus

commission basis depending on the amount of sales that the staff generates. This sales team

will be responsible for promoting Want at various action sports events that occur throughout

the year. Furthermore, these five new sales reps will be responsible for increasing brand

awareness of the Want beverages and managing inventory levels at various retailers who carry

the Want product. Want should continue to promote their socially responsible brand by

donating 5 cents (reduced from 15 cents) from every bottle purchased to local community

skateparks and action sports events. This maintains Want’s socially responsible image, and

increases the company’s financial flexibility.

Expected Results

Want is projected to attain a profit of $33,795 in its second year of operations largely

due to increased brand awareness, an innovative and experienced sales team, increased

inventory levels to meet demand, guaranteed sales contract with West 49 and an equity

investor with an annual 5% dividend return. The break even quantity is 13906 cases per year, or

less than half a percent of the Canadian market. Refer to Appendix B for an in-depth analysis of

financials.

Appendices

Appendix A:Alternatives

Decision Criteria

Selectively distribute Want to non-traditional retailers and convenience

Intensively distribute Want to non-traditional retailers, convenience stores,

Exclusively distribute Want to non-traditional retailers, convenience stores or

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stores located in close proximity to their target market.

and bars. bars.

Increasing sales to a level that ensures long-term success

Limits overall sales volume, but increases sales within niche market to ensure long-term success.

Increases sales volume, but more difficult to maintain long-term success against competitors.

May increase sales within a concentrated market, but limited overall growth potential.

Maintaining flexible production capacity and inventory levels

Company can remain with original manufacturer that offers flexibility in production. Only a small chance of exceeding warehouse capacity.

Company most likely would be required to switch manufacturers to have capacity for intensive distribution.Most likely face warehouse inventory capacity issues.

Company could remain with original manufacturer. Almost no chance of reaching maximum production capacity.

Increasing brand awareness among target market

Target market more exposed to Want in these locations. Continued promotions directed at target market increase awareness.

Brand awareness could increase, but also face a greater risk of direct competition from Redbull and other competitors.

Not a great chance brand awareness could reach a substantial level if exclusively distributed.

Stay aligned with goals of corporate social responsibility

Maintains Want reputation for donating to local, selected communities.

May dilute image of social responsibility towards communities if sold intensively across Canada.

Maintains Want reputation for donating to local communities.

Appendix B:

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