Afdsa Essay

988 Words Nov 22nd, 2015 4 Pages
“more loyal to flavor than brand” (Page 5).
Positioning Statement: Among older adults, Vital-Aid is the only brand of Sports Drink that provides a healthy hydrating solution; containing powerful antioxidants that reduce the risk of many diseases including cancer.

Pricing strategy: Two pricing strategies can be used with new products Skimming and Penetration. Skimming strategy will help us reach our performance objective by covering high costs of development, sacrificing high sales for high profits while capitalizing on the price insensitivity of buyers. A Penetration strategy would not be beneficial because with a lower price and a higher production cost, our profit margins will be negatively affected and our performance objective will
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Grocery stores mostly because they make up nearly 60% of sports drink sales so we need to be in that channel in order to compete with Direct Rivals (Page 3). Start in fewer Club stores, use that success to go further into channel. Even though club stores “tended to ignore a new product” (Page 3), Ideals-oriented are “much more likely to purchase at club stores” (Page 6). No convenience stores because “only 1% of grocery sales occurred at gas stations” (Page 8).

Promotion mix and budget: The budget of $50M for 5 flavors should be allocated as follows: $35M for advertising (75% on TV, 20% magazine, last 5% shared among radio and newspaper and celebrity endorsement), $11M for trade promotion, and $4M for consumer sales promotion. This is the introduction stage of the PLC so it is most important to focus on gaining awareness and informing through advertising.
Media – Television has high reach and can target specific segments, uses color, sound and motion to explain the product and it’s benefits. Magazines show great color and quality to show off flavors, can target specific audience, has long life and can convey complex message. Radio and newspapers are low cost specific targeting methods to reach older target market of 40+. Use Richard Simmons as spokesman because he shows relevance (FRED - 4 Keys to Good Celebrity Spokesmen) to the product and older target market, in addition he is known for

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