Marketing Environment and Planning Process for Launching a New Soft Drink

The basic principle of marketing takes into account defining the overall plan regarding how the particular product or service is intended to be presented in the chosen market. These principles help in analysing and understanding whether the chosen marketing techniques are well coordinated with the demand and needs of this target market segment (Philip, 2017). Hence this report will be classified into three sections that will discuss about the launch of new soft drink for a particular market segment. The firsts section will outline the whole marketing environment and the plan of how the marketing of this newly launched soft drink would be initiated with a major focus on the macro and micro environmental factors, then the second section will be focused of segmentation, targeting and positioning of this new product and the final or the third segment will analyse the 7p’s of marketing mix for this newly launched product.

Section 1: Marketing Environment and Planning Process:

The global carbonated beverage market is expected to showcase a growth rate of CARG of 3.15% during the forecast period 2020-2025 (statista.com, 2021). The carbonated beverage market is therefore considered as one of the matured industries across the globe. However in the recent times there has been a growing amount of awareness among the consumers regarding the high content of soda and sugar in these soft drinks which definitely makes it quite an unhealthy choice (Garcia Martinez, et al. 2014).

Today consumers are much more aware an informed in comparison to past days which is exactly the reason why this consciousness is growing amongst the global consumer market which is in turn making these soft drink producing companies think and renovate their products (Ashurst, Hargitt  and Palmer, 2017). This is exactly the reason why “Fizz” which is quite a popular global soft drink brand in the Asian Countries mostly in China, Indonesia and Japan is focusing to extend their product portfolio and include the section of “energy drink” in their product segment which would be known as “Energize”. These would also be flavoured soft drinks yet the content of sugar would be replaced by glucose and Acesulphame Potassium and the soda content will also be minimised.

Now considering the launch of this new soft drink product the primary aim of this company is to not only to make it more healthier for the consumers who choose to avoid carbonated drink because of its high sugar content but also to reduce the environmental footprints of the business as Fizz has aimed to completely cut down its use of plastic bottle and instead use recyclable and reusable packaging specifically for launching its new segment which is “Energize”. This can be identified as a technique for the brand to rebuild its market image and better target a new market segment for its brand.

Section 1: Marketing Environment and Planning Process

Fizz has chosen to focus on Asian countries for launching its “Energize” energy segment because in Asian countries the consumer’s awareness is still maturing and the market segment for energy drink products is also quite expanding. Hence it would be easier to tap new markets with special focus on India because it is one of the largest consumers of soft drinks (statista.com, 2021) and keeping in mind the scorching summer that has already appeared it would be a very appropriate time to launch this new energy drink. Moreover consumer conscious is still building in these countries where mostly millennial market segment have started looking for healthy alternatives to carbonated soft drinks. Hence altogether targeting the Indian market with most metropolitan cities being in focus will definitely be a good idea for the brand (Greenwood, et al. 2014).

However before launching a new product segment it very important to analyse the macro environmental factors which will have quite a large impact on the overall business of Fizz. Considering the Indian soft drink market the existing macro environmental factors that can be identified using the PESTEL analysis framework includes: the political (P) factor that defines the soft drink market in Indian is the certification that businesses have to get by the government known as Food and Drug Administration (FDA) Regulation (Kregiel, 2015) which acts as a statutory body governing that the companies meet the set standards of business performance.

The economic (E) factor includes the current market which already seems to be quite favourable with new brands flourish its business in the Indian market economy (Haji, 2018). The socio-cultural framework (S) defines the changing demands and preferences of consumer segments that are now consciously looking for healthy alternatives which provide favourable grounds for “Fizz” to launch its new product in this market (Chhabra and Kiran, 2015).  The technological (T) factor includes how through partnership and international collaboration latest technology can be used to produce eco-friendly products to minimise the carbon footprint of the business (Demartini, et al. 2018).

Thus Fizz can use its Western world technologies to produce best quality products. The environmental factor (E) includes how businesses need to reduce their overall carbon footprint to function in the most sustainable manner and finally the legal factors (L) include how businesses operating in this market need to adhere to proper legal standards in aspect of its nutrient information to abiding by OSHA standards for factory regulations (Coble, 2019).

Now it is important for Fizz to understand that though the market of soft drinks in India is expanding yet there are few matured brands which are ruling the overall market. Therefore to strategically build business and ease the process of market entry Fizz will initiate a joint venture with Coca-Cola (Masiero, Ogasavara and Risso, 2017) which is one of the leading soft drinks brand in Indian and allow Fizz to get better exposure in the local market, initially help the brand develop consumer’s trust and strengthen the overall international business relations. This is important because the existing market competition in the soft drink industry in India is quite high as well as the threat of substitutes. Hence to get introduce and survive in this local competition for a foreign brand such collaboration is very important (Shah, 2015). This is the reason why Fizz has decided for this collaboration.

The decision for “Fizz” to expand its market in India is definitely quite strategically planned and in order to receive much success, the brand needs to also strengthen its overall marketing mix which can actually hold potentials of impressing the millennial market segment who are no doubt very dynamic, robust, aware, informative and definitely find those brand interesting who can customise, innovative and create strong interpersonal relationship with them. Therefore while creating the marketing mix (IšoraitÄ—, 2016) for this newly launched segment that is “Energize” the marketers of the brand need to focus not only on the product, its quality and taste but needs to go beyond and focus on the overall experience which this brand is bringing for the millennial market segment which will actually help Fizz easily enter into the chosen lifestyle, choice and preferences of its chosen market segment.

Therefore the marketing mix of Fizz for its “energize” product segment will ensure serious focus on building the overall appeal and experience of the customers by choosing the right communication channel which ensures interactivity along with building awareness. In terms of pricing Fizz needs to be aware of the existing market competition and choose a strategic pricing method as a new entrant in the market and also keeping in mind the target market segment (Khan, 2014).

Fizz has to keep in mind that digital communication would be a very important part and platform for its product and chosen market segment because it will play a major role in creating the necessary appeal and building the require awareness among the chosen segment. The primary issue which needs to be considered by Fizz is that it has to go beyond the realms of selling just an energy drink and build an image of selling a lifestyle that is appropriate and an experience that is worth choosing (Huang and Sarigöllü, 2014). The need of the hour is to build a marketing mix that will actually help Fizz to easily propagate its unique selling propositions (USP) which include: health, taste and eco-friendliness.

Section 2: Segmentation, Targeting Positioning:

For ensuring a successful entry of a brand in a new market it is extremely important to concentrate on the overall segmentation, targeting and positioning strategy that is been applied by the brand for that specific product category (Andaleeb, 2016).

For ensuring a successful entry of a brand in a new market it is extremely important to concentrate on the overall segmentation, targeting and positioning strategy that is been applied by the brand for that specific product category. As Fizz is completely a new brand for the Indian market its decision to enter into a joint venture with Coca-Cola seems to be quite a strategic decision to easily enter and sustain its position in this foreign market (Schlegelmilch, 2016). Hence the next area of focus for Fizz is to understand how it will segment the identified market to appropriately target and position its products.

Fizz will consider both business-to-business (B2B) market segment as well as business-to-consumers (B2C) (Madosh and Ålander, 2019). Initially to consider the B2B marketing the chosen segment might include retail outlets like various supermarkets along small restaurants and cafeterias who sell various alcoholic and non-alcoholic beverages (Battaglia, et al. 2015). Fizz can also partner with digital delivery platforms like Big Baskets along with various pubs and clubs where there are customers who prefer non-alcoholic beverages or mix it with their cocktails. As the chosen market segment is millennial generation is these pubs and clubs along with using the digital delivery method is quite appropriate.

Now coming to the business-to-consumer (B2C) market segment the demographics will constitute of the age group between 20-38 years, the income status that the brand intends to focus on is lower to middle income groups because it intends to target college students (DeVaney, 2015) who might not have still started earning hence the prices would be set accordingly. Hence the occupational status might vary that is they might be working or interns or still studying. Next is psychographic segmentation approach where Fizz will focus on personality, lifestyle, interest and attitudes of the customer (Gajanova, Nadanyiova and Moravcikova, 2019.).

As there has been a growing demand for healthy alternatives in the soft drink segment and most popularly amongst millennial who want taste with health, again there are millennial consumers who are regular visitors to pubs and clubs prefer cocktails which are clubbed with energy drinks, there are fitness freaks who always prefer to go for energy drinks rather than sipping a carbonated soft drink in scorching summers, the student crowd who often prefer energy drinks because they give them an instants doze of glucose to reenergise them, Fizz with its “Energize section actually wants to appeal to this segment of population (Miranda, 2018).

Next is behavioural segmentation which takes into account factors like purchasing behaviour, benefit sought, and usage rate and customer loyalty (Nagaraju and Kumar, 2014). Apart from this Fizz also aims to appeal to those consumers who support eco-friendly business ideas as Fizz has committed to use bio-degradable cans and bottles for packaging its drinks. Behavioural segmentation actually helps brands to understand how the products would be perceived by the consumer segment, which are the areas that the brand actually needs to focus on. For instance Fizz needs to analyse the purchase behaviour of the chosen market segment that is the millennial that is how to actually purchase soft drinks, what primary factors do they consider while making their purchase decision like: price, taste, nutrient content (Elangeswaran and Ragel, 2014).

Then the next element in behavioural segmentation is benefit sought which actually determines what the chosen market segment is actually looking for in the product that is in a soft drink brand the millennial market segment can look for taste variation, amount of calories present, and the level of thirst quenching effect it has and the environmental footprint of the business (Shahzad, et al. 2015). Hence Fizz needs to appropriately meet these criteria to actually appeal to this target market segment. Next is customer loyalty which is often linked with other factors like purchasing behaviour or benefit sought. Now the primary reason for Fizz to target the millennial market segment is because this segment is very much open to experiment with their taste and choices (Saleh and Abdel, 2018). Hence gradually Fizz has to focus on building customer loyalty through innovative pricing, quality products and most importantly personalising the overall appeal of the brand.

Once market segmentation is done and the target market is completely defined the next important step that comes in the marketing process is appropriately positioning the product or service. Positioning basically constitutes of placing the product in the right manner in the consumers mind by choosing the appropriate pricing, promotion and creating the right appeal for the product (Moon and Kamakura, 2017). Positioning actually defines the overall product image or how the product will actually be perceived by the customer segment.

For instance Fizz with its “Energize” product segment wants to position itself as an easily affordable healthy energy drink which is low on sugar and is marketed in an eco-friendly manner that is using biodegradable bottles and cans. As Fizz is entering into a joint venture with Coca-Cola hence it will have a larger market segment where the loyal customers of Coca-Cola will be present with some new customers which the brand will try to appeal (Fayvishenko, 2018). Hence its positioning strategy would be to place itself in an affordable and healthy segment of soft drinks which is not only quality conscious but also promotes sustainability in its business operation (Ubeja and Patel, 2014). Overall the marketing strategy will focus on prioritising the needs of the millennial market segment who look for taste and health under the same umbrella along with focusing on the aspects of easy affordability and green business performance.

Section-3: Marketing Mix Analysis:

Marketing mix can be defined as the set of all those tactics and actions that actually helps the brand to effectively reach to its chosen market segment and achieve a competitive position in the market. The four primary elements or the 4Ps of marketing mix which was actually the traditional approach included: product, price, place and promotion (IšoraitÄ—, 2016). However with the changing needs and demands of the consumer market segment the existing traditional elements in the marketing mix have been preceded by other 3 P’s which include: people, process and physical evidence (Londhe, 2014). While these three Ps that belong to the contemporary conceptualisation of marketing mix is certainly more applicable in the service industry yet it is important for brands those who aim to not just sell products but to emphasise on their overall experience of the brand with their chosen market segment (Bahadir, Bharadwaj and Srivastava, 2015).

Now focusing on Fizz and its marketing mix strategy for launching its “Energize” segment which is basically energy drink low on sugar, high on glucose with variant flavours the marketing mix that will constitute of the 7Ps will focus on :

• Product-As the market competition is quite high for Fizz and it has entered into a joint venture with Coca-Cola hence there can be no compromise in the quality of the drink being sold. It has to focus on the major USPs of the product which is its healthy composition followed by its variant flavours and unique packaging which gives boost to the concepts of doing business with sustainability (Mustaqimah, Hartoyo and Nurmalina, 2019). The product will primarily focus on its unique taste that will attract consumers who prefer energy drinks to be blended with their cocktails as well as for those who prefer to drink it as a simple beverage. The variation in flavours will be based on summer demanding tastes like cool mint, blue berry, Virgin Mojito, Kiwi, Coconut.
• Price-As Fizz has partnered with Coca-Cola to get significant market exposure hence it can use competitive pricing strategy that will help the brand to gain better competitiveness in the market (O'shaughnessy, 2014). Analysing the target market segment the pricing strategy has to be kept flexible with certain discount offers on bulk purchase as the brand intends to promote to B2B as well as B2C consumers
• Place- placement or the overall channel and method of distribution plays a very vital role in the overall marketing process. Hence Fizz has chosen to serve both B2B and B2C segments hence it has to engage in physical as well as digital distribution channels (Kumar and Ray, 2018). From directly supplying to retail outlets to restaurant and pubs, street vendors to convenience stores to movie theatres Fizz will also sell its products on online grocery stores. It will also strategically make use of the existing local distribution channels which Coca-Cola has in all metropolitan cities.
• Promotion-It is very important to choose promotional channels according to the preferences of the target market segment that is after determining which media platforms the segment is most exposed to (Ubeja and Patel, 2014). However as Fizz  has partnered with Coca-Cola hence it will definitely use the traditional channels which include television, newspaper along with Outdoor advertising in form of bill boards but it will also excessively focus on digital channels of communication with special focus on social media marketing and mobile marketing along with event marketing. The reason to focus particularly in these contemporary communication channels is that the millennial generation is highly obsessed with social media platforms as these allow personalisation of brands where the marketing techniques can be made quite interesting as well as interactive. For instance Coca-Cola has the greatest example with its #Shareacoke campaign (Fetisova, 2015) that brought massive profit and global recognition for the brand because it was engaging and had a personalised appeal. In the very same manner Fizz can also come up with exclusive and interactive promotional campaigns of social media where it can ask customers to rate the flavours or conduct an online poll to vote which flavour they love the most or post a picture with a can to win free hampers on their next purchase (Liu and Lopez, 2016). Such interactive promotional techniques are not just cost-effective but have a long-way to go when it comes to strengthening consumer loyalty. Apart from this mobile marketing techniques which includes sending personalised message or offers to the target market base is yet another effective technique that can be utilised by the brand
• People-Here Fizz needs to focus on its internal business management by ensuring that the employees and staffs operating in the organization are ensured with a safe working atmosphere. As Fizz will be using the factory and infrastructure of Coca-Cola hence it is easily understood that the corporate governance structure will be well taken care of.
• Process-The whole process of producing the products to its distribution and packaging will involve a lot of intermediary stages where Fizz needs to continually concentrate on meeting quality standards at all aspects of the operation (Grădinaru, Toma  and Marinescu, 2016).
• Physical Evidence- For Fizz physical evidence is definitely includes the eco-friendly bottles of “Energize” but apart from this the brand will concentrated on building a distinct brand identity be it with its own merchandises that it will offer has gift hampers for its B2B as well as B2C market segment (Neelakantam) the brand logo along with the overall experiences that the brand will offer in terms of after sells communication which will focus on having an infotainment appeal

7 Ps of Marketing	New Soft Drink Product (Energize)
PRODUCT	Taste, quality, health, eco-friendly appeal
PLACE	Offline as well as online availability
PRICE	Competitive Pricing strategy
PROMOTION	Traditional as well as contemporary medium, special focus on digital and social media marketing channels
PEOPLE	Ensuring proper human resource management
PROCESS	Quality and transparency in overall manufacturing, packaging, distribution and marketing process
PHYSICAL EVIDENCE	Product Bottle, special merchandises, brand logo and after sales brand interactivity.

Conclusion:

The overall presented analysis helps in understanding the whole marketing communication technique that Fizz needs to adapt to introduce its new soft drink segment “Energize” in the Indian market. The target market segmentation and positioning provides strategic aspects of how foreign brands should operate in local market while the market mix helps in defining the overall marketing activity and the primary areas where the brand should focus on to gain a competitive position in the market

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