Nestea and Lipton Go After AriZona

Nestea's new 695ml cans to compete head-to-head with AriZona.  Courtesy of facebook.com

Nestea’s new 695ml cans to compete head-to-head with AriZona. Courtesy of facebook.com

Each summer I pay a little more attention to monitor the Ready-to-Drink (RTD) tea segment.  Some of my beverage industry contacts say that AriZona’s dominance in the RTD tea segment have inspired other beverage companies to launch similar $0.99 tall cans to steal some of AriZona’s sales.  Most recently, I’ve noticed both Nestea and Lipton stock some competitive offerings.  Both have come out with tall cans of tea, with similar $0.99 price points labeled on the cans themselves.  Given that AriZona has made $0.99 teas their claim to fame and have been selling them for many years already, how successful will Nestea and Lipton be at stealing some sales?  More importantly, is selling tea at $0.99 profitable for Nestea and Lipton, or is there another reason for them to enter this segment?

Unlike AriZona, Nestea and Lipton have strong backers.  Nestea’s partnership with Coca-Cola provides them a robust distribution network.  Lipton also has a strong market coverage through their agreement with PepsiCo.  Both competitive brands would be able to leverage the sales and merchandising support of Coca-Cola and Pepsi to ensure retailer shelves are always stocked.  Beyond retail coverage, both Nestea and Lipton would get premium in-store placement locations.  Coca-Cola and Pepsi both own front-end cooler space as well as multiple locations within a grocery store, giving them the opportunity to stock products to their liking within these areas.  So unlike previous challengers, AriZona will face their strongest competition yet in Nestea and Lipton.  These two competitors have the necessary support and expertise to erode AriZona’s leadership in this segment.

Nestea's new 695ml cans to compete head-to-head with AriZona.

Nestea’s new 695ml cans to compete head-to-head with AriZona.

Given these dynamics, it certainly appears that Nestea and Lipton stand as formidable opponents to AriZona and steal their sales.  However, both Nestea and Lipton are known best for their offerings in a different tea format: bottled tea.  By rolling out these $0.99 aluminum cans, don’t they risk cannibalizing their own sales from a more profitable tea format?  Wouldn’t this make the decision to launch 695ml tea cans with $0.99 printed on it hurt their total tea business?  Given the risk associated with devaluing sales potential, why come out with tall cans at all?  In the end, they are just as likely to steal sales from AriZona as they are on stealing their own sales.

Simply put, it may be better to get less dollars from the consumer, than get none at all.  If their market research indicates that the same consumers buy both bottled tea and canned tea, both Nestea and Lipton have much to lose by not having a canned tea offering themselves.  And given the price range of canned and bottled tea, it would appear that canned teas serve as the “value” segment to get people to buy a tea product.  Bottled tea appears to serve more as a “mid-value” or “premium” segment.  Should Nestea & Lipton leave AriZona to own the value tea, it will be much harder to steal that tea customer away at a later point when they are interested in moving up the value chain to premium tea.

As long as you can get them to buy (or try) your drink once, you’ll stand a chance to get them to come by as a repeat customer.  Even if the immediate value is $0.99, there could be opportunities to get these thirsty consumers to buy the more expensive bottled tea at a later time.

vitaminwater Refreshes Canadian Product Portfolio

The @vitaminwater_caa twitter headshot, current as of July 2014. Courtesy of twitter.com

vitaminwater Canada product line-up from their twitter page head shot as of July 2014.  Courtesy of @vitaminwater_ca (twitter.com)

It seems vitaminwater has recognized the limit on how many drink flavors can be sustained in the Canadian marketplace.  That number stands at twelve.  The hydration brand has quietly launched two new flavors under their Zero sub-brand, introducing Rise (orange) and Squeezed (lemonade) to build their calorie-free portfolio.  Very subtly, two of the previous zero-calorie flavors – Resilient-C (grape raspberry) and Recoup (peach mandarin) – are being phased out to make space for the two new offerings.  Beyond the zero-calorie product transition, Spark (grape blueberry) also is being phased out.  Notice the different flavors in the image above and below (Recoup has never been pictured).  It’s certainly interesting to see that the marketplace – and retailers – can sustain twelve flavor extensions.  Definitely not an easy feat to create shelf or cooler space for twelve items.

What is more interesting though, is vitaminwater’s approach to continuously refresh their product line-up.  While there has always been steady sales coming from popular flavors such as XXX, Essential, and Multi-V, there are “test” flavors launched into Canada.  From the hydration brand’s introduction, Rescue (green tea) was the first to be discontinued.  Through the years, other flavors have made brief appearances and slowly gone away, including Formula 50 (grape) and Sync (Berry Cherry).  And beyond these flavors that were expected to mainstays were limited-time offerings, such as the recent Glory (peach mango) flavor for the 2014 Olympics.  Regardless of all these other changes, the magic number – or limit – appears to be twelve flavors.

Despite a mixed response leading to varied success and failure, their constant innovation is admirable.  The company keeps on bringing flavors into the market to see what sticks with consumers.  It would be safe to say that vitaminwater has introduced up to twenty flavors at one point or another to the Canadian market.  Beyond the original eight flavors that accompanied the Rescue offering at launch, the most successful introduction has been Energy (tropical citrus).  Most of the grape flavors – Spark, Formula 50, Resilient-C – have only made brief and unsuccessful appearances.

vitwaminwater Canadian product line-up as of July 2012.  Courtesy of @vitaminwater_bc (twitter.com)

vitwaminwater Canada product line-up as of July 2012. Courtesy of @vitaminwater_bc (twitter.com)

Regardless of success or failure, it is a welcome sign to see a company continuously improve their product line-up.  Before an item can be launched, a company invests significantly behind research and development to determine its viability, demand, and sales potential.  And to consistently bring new products to the market, this is a sign that vitaminwater believes in the product’s longevity.  Even with product proliferation being a key concern that prevents retailers from stocking all the flavors, substituting new products in place of slower selling products helps both parties.

After all the product substitution, let’s just hope that vitaminwater eventually finds a grape flavor product combination that will stick in the Canadian marketplace.

Red Bull Celebrates Summer With New Flavor

The new Red Bull Summer Edition is available exclusively at 7-Eleven locations across Canada and the U.S.

The new Red Bull Summer Edition is available exclusively at 7-Eleven locations across Canada and the U.S.

Building on their momentum of the Red Bull Editions, the energy drink manufacturer will launch a new flavor exclusive to 7-Eleven locations in Canada and the U.S.  Aptly named the “Summer Edition”, the drink’s packaging is a sunny-yellow colored 12oz (355ml) can.  The tropical fruit-flavored drink adds to the Red Bull Editions line-up of the Red (cranberry), Blue (blueberry), and Silver (lime) flavor offerings.  7-Eleven has exclusivity of the Summer Edition in July and August, with a consumer promotion running until September 2nd (per the corporate 7-Eleven news release).  After that, no guarantees whether this becomes available across other retailers or it is truly an exclusive, limited-time offering.  If history proves to be repeated, then the Summer Edition will be here to stay.  Red Bull had previously launched their Red Bull Editions exclusive to 7-Eleven in March, followed by availability at other retailers a few months later.

It’s not the first time beverage companies have partnered with 7-Eleven for exclusive offerings.  Most recently, Gatorade had launched their Gatorade Fierce Green Apple flavor exclusively with the convenience retailer.  The results of that launch is detailed in this Pepsico news release.  The proven success of exclusive launches help 7-Eleven secure more preferred agreements with other beverage manufacturers.  After all, the convenience retail channel generates healthy sales and even healthier profit margins.  And with 7-Eleven adding more retail locations across North America, they certainly have the clout to command more customized products.  For Red Bull, this arrangement is preferable since it helps the energy drink manufacturer lock up more valuable shelf space in the nation’s leading convenience retail chain.  In addition, this also allows them to focus their advertising support behind one product at one retailer, helping to drive a stronger, more focused message.

Red Bull has previously launched the Red Bull Editions exclusive to 7-Eleven before opening it up to all retailers.  Courtesy of flippies.com

Red Bull has previously launched the Red Bull Editions exclusive to 7-Eleven before opening it up to all retailers. Courtesy of flippies.com

In BevNet.com’s article on the Red Bull launch, the publication detailed that Red Bull is slower to launch new products relative Monster Energy, leading to slower sales growth (link here).  The comment is not without merit, as it appears that Red Bull’s sales are more reliant on existing drinks rather than new innovations – especially with a innovation history that includes unsuccessful attempts to diversify with  Red Bull Cola and Red Bull Energy Shots.  However, their recent product launches came from an area where they are the clear leaders and have been quite successful.  And with fewer launches, Red Bull is able to put more attention into each launch, and ensure that it receives full support across media outlets as well as.  Case in point: their launch efforts behind Red Bull Total Zero and the Red Bull Editions have been well executed with media and in-store support.  Even their BULL Energy Drink has garnered strong attention despite catering the beverage to a highly specific market.

The lower frequency also helps Red Bull convey a stronger brand presence that coincides with their premium pricing.  Fewer launches highlight a prestige that will be harder to sustain if launches become fast and frequent.  So with the Summer Edition now available in 7-Eleven, let’s see how Red Bull celebrates with their Summer Edition.  It won’t be forever until they have another product launch, but it will surely be after they make sure the Summer Edition is successfully entrenched with  the customers and consumers.

At-Home Carbonation Reaching Critical Mass

It wasn’t that long ago that all we knew about at-home carbonation soda was Sodastream following their banned SuperBowl ad in 2013.  In the years since, Coca-Cola has joined up with Keurig and Pepsi has partnered with Bevyz to develop home brewing units and syrups.  We can now add another known competitor to the mix.  Sparking Drink Systems (SDS) International has a product called Viberation that produced carbonated soda all within one beverage pod.  It’s entirely possible that other companies are developing at-home carbonation units with its growing appeal.  Consuming carbonated beverages in an environmental-friendly way helps remove some guilt by reducing the plastic waste.  Sugar intake is another problem, but that’s a focus for another day.  As more competitors enter this expansive home-brewed beverage space, what will define their success?

The SDS Viberator, carbonating beverages within a single beverage pod.

The SDS Viberator, carbonating beverages within a single beverage pod.  Modified image via sparklingds.com.

One of the stronger products in the marketplace would be the SDS Viberation.  This Viberation has the capability to produce sparkling and enhanced waters, carbonate sodas, and even carbonate alcoholic beer without a CO2 cylinder.  The elimination of a CO2 cylinder increases the usability of the device, and possibly increase its adoption rate.  At this time, the Viberation is distributed across a variety of regional US-based distributors.  In order for this device to succeed, it must gain more exposure through securing distribution, marketing, and innovation.  Gaining distribution brings the Viberation to consumers that shop in bricks and mortar stores, or online.  Marketing efforts educate the consumer on the product benefits and its unique selling proposition (great-tasting carbonated beverages without a separate CO2 device).  Innovation makes meeting the consumer needs paramount with more flavors and assortment.  All three could end up being done through collaboration.  With a branded player (ie Starbucks? Dr Pepper Snapple Group) helps increase its reach, awareness, and appeal.

SodaStream’s main challenge appears to be part of its business model: carbonation cylinders.  With the competition’s ability to carbonate a beverage without any CO2 tanks, the Israeli-based company is facing an uphill battle to innovate.  Despite their recent marketing efforts at the SuperBowl to gain worldwide exposure, their growing stable of branded syrups, and their international distribution, the product still requires customers to invest in purchasing a CO2 device.  As the market shifts toward “all-in-one” devices, SodaStream’s may need to develop an at-home carbonation unit that can brew soda without a CO2 cylinder.  One of the core challenges SodaStream now faces is understanding whether their business model is still viable given the competitive landscape.  The C2 cylinders is a lucrative revenue stream, but it is also the barrier toward their adoption with more home-brewing appliances available.

The CO2 cylinder presents a great revenue source for SodaStream, but is also prevent fast product adoption. Sourced from coolest-gadgets.com.

Coca-Cola’s partnership with Keurig brought greater attention to this product segment.  Distribution and innovation likely are not challenges for the world’s largest beverage manufacturer.  In fact, these areas exist as its core strengths.  Keurig Cold will have the ability to not only brew Coca-Cola carbonated drinks, but also produce teas, sports drinks, juices, and a host of other Coca-Cola-manufactured beverages.  Marketing may actually be where Coca-Cola’s Keurig Cold device sees the biggest challenge.  The majority of their marketing dollars still reside with bottled beverages, and intensely promoting Keurig Cold will cannibalize their sales.  Another marketing challenge would be Coca-Cola’s ability to create the demand for beverage format when their bottled format is so successful and widely available.  Similar to Kraft MiO entering the liquid enhancers space first and Coca-Cola following, SodaStream pioneered the at-home carbonation space.  The challenge for Coca-Cola within liquid enhancers is not their product assortment, but their marketing efforts to create the demand for the liquid enhancer form of their beverages.  Coca-Cola beverage pods may endure the same fate as their liquid enhancers: broad assortment and distribution but limited marketing funds preventing the product line from reaching its full potential.

Pepsi’s Bevyz partnership will release an at-home carbonation unit to the market sooner than Coca-Cola.  The Pepsi Bevyz Fresh Machine was launched in the U.S. this past May.  Despite first-mover advantage, one of their core challenges appears to be marketing.  The market has not heard of Bevyz, and the majority still do not know Pepsi has developed an at-home carbonation unit.  While the product’s distribution and innovation are strengths, the marketing aspect seems to be the most significant barrier to overcome.  Despite the product’s versatility to carbonate beverages, produce teas, juices, and waters, and even serve as a water cooler, consumers are simply unaware of this machine.  Check out their 2011 Bevyz in Action video below.  Pepsi has been slow to react when Coca-Cola moved first in other spaces, such as in liquid enhancers and intelligent fountain units.  If Pepsi continues to think methodically before acting, they may stand to lose more ground to Coca-Cola and other competitors.

Each competitor faces their own challenge within this home-brewing beverage space.  Roadblocks toward growth include marketing, distribution, and innovation – it just depends on your business stage.  What is certain is more organizations are dedicating resources to small home appliances to help consumers make their own beverages.  This in turn helps the segment approach critical mass toward being available in every consumer’s kitchen counter space.

Diet Coke Reverts to “Just for the taste of it!”

Image courtesy of ispot.tv.

Diet Coke has changed their slogan – again.  After rolling out “You’re On. Diet Coke.” recently and receiving a lot of criticism, they have changed it back to “Just for the taste of it!”  It appears that the weight of the media backlash was too heavy to bear.  Diet Coke’s marketing executives acted once the slogan attracted continued negative publicity, necessitating a change and dissociation from this negativity.  Here’s the new commercial below, where there is no visible reference to a Diet Coke slogan – only a verbal reference.

Going back to the “Just for the taste of it!” slogan is an interesting choice, seeing that they have returned to this slogan three other times.  This slogan launched alongside Diet Coke’s introduction in 1982, and was subsequently resurrected in 1986, 1995, 2006, and now 2014.  Seems like other Diet Coke slogans just don’t have staying power like the original.  The “Just for the taste of it!” turns the attention back to taste and calories.  No focus on drugs – cocaine or aspartame.

In a time when all brands try desperately to manage their image – especially across social media – returning to the basics is necessary.  Even as Diet Coke has worked hard to establish a strong image as a lifestyle beverage with slogans like “Stay Extraordinary” or “You’re On”, solidifying its foundation remains critical.  Beyond all the dreams and aspirations, it must continue to deliver on the “brand promise” of a great-tasting sugar-free soda.  With this latest debacle, here’s hoping that Diet Coke has indeed learned its lesson.  As soda became linked with obesity and aspartame became linked with adverse health effects, some of Diet Coke’s campaigns veered off course to defend against these claims.  Other Diet Coke campaigns focused on establishing a strong image outside of its product attributes.  Both these types of campaigns made the brand less tangible and may have led people to forget what Diet Coke truly stood for.  And it certainly opened the door for criticism by marketing bloggers like myself.  A re-dedication to its core is essential in reviving Diet Coke.

While no publicity is bad publicity, the staying power of this bad publicity mattered more.  A couple years of advertising the new-old slogan of “Just for the taste of it!” should help re-establish Diet Coke’s image of a great-tasting sugar-free drink.  Who knows, it could be the right time to expand as a lifestyle beverage  at that time.  Diet Coke just needs to find the right balance of their image of being a great-tasting drink and being a lifestyle drink.

Starbucks Brings Teavana Into Coffee Shops

Starbucks baristas now brew Teavana ice teas for Starbucks locations. This is the start of a

Starbucks baristas now brew Teavana ice teas for Starbucks locations. This is the start of a “shake up”. Image courtesy of http://www.ispot.tv.

Not sure if anyone has noticed the latest Starbucks commercial.  The coffee giant is now featuring their Teavana shaken iced tea as a summer drink.  Why is this important?  This TV commercial shows Starbucks baristas making the beverage, and showing the ice teas as available within Starbucks locations.  This is different from their initial strategy for Teavana.  The Seattle-based coffee company stated that Teavana operations would be completely separate from Starbucks, and increase the Teavana standalone locations.  While they continue to open Starbucks and Teavana locations, is bringing Teavana-branded offerings under the Starbucks locations the right thing to do?

Starting with the recent Oprah collaboration, Teavana products have increased exposure within Starbucks locations.  Beyond the handcrafted Oprah products, Starbucks customers would start seeing Teavana tea packages and mugs available for sale.  It certainly looks like the bringing Teavana-branded beverages into Starbucks locations will help increase Teavana’s exposure.  This cross-branding effort strengthens the Teavana brand and opens up more possibilities for Starbucks.  While Starbucks had always served iced teas within the retail establishments, they were never branded.  This changes as they now brand them under Teavana.  The coffee giant has the platform to brand a variety of beverages within their retail locations.  Starbucks has built up Teavana and Tazo for tea, Evolution Fresh for juices, Ethos for bottled water, and Clover for premium coffee.

With more Teavana locations opening up, this provides Starbucks with greater opportunities.  Though the strong smell of coffee may prevent it from being brewed inside a tea establishment (likely the same reason that Starbucks locations only serves Teavana iced teas), water and juices could be strong candidates for increased distribution.  Ethos and Evolution Fresh may only require a cooler for refrigeration and do not emit strong aromas like coffee or tea.

Starbucks’ acquisition of Teavana came with retail locations that created potential scale for the beverage organization.  Now we can clearly see how cross-promotional opportunities exist between Teavana and Starbucks.  As Starbucks has also supported Evolution Fresh in standalone locations, it is highly likely that the organization’s continued expansion will involve Starbucks or Teavana products within Evolution Fresh juice stations as well.

Here’s the Starbucks Teavana ice tea commercial called “Shake Up”.  Though the commercial itself is simple and showing baristas creating Teavana iced teas, the name could be symbolic.  Starbucks continue to position itself to “shake up” the beverage landscape.

Backed By Popular Dewmand Reaches Canada

Mountain Dew Canada brings back Code Red, White Out, and Supernova for Backed by Popular Dewmand Canada.  Courtesy of facebook.com.

Mountain Dew Canada brings back Code Red, White Out, and Supernova for Backed by Popular Dewmand Canada. Courtesy of facebook.com.

It looks like Pepsi likes to recycle American promotions for the Canadian market.  Mountain Dew had used the “Backed by Popular DEWmand” promotion to resurrect popular discontinued flavors, and are now running this campaign in Canada.  Following in the success of Voltage winning the first Canadian DEWmocracy, Code Red, Supernova, and White Out are now returning to store shelves until early August.  Like the original DEWmocracy campaign, consumers vote and choose which flavor they’d like to remain available after August 2014.  No mention on whether the winning citrus soda will become a permanent beverage in Canada.  However, if the 2013 promotion was any indication, there is a strong chance another flavor will join their current beverage line-up come September.

Intelligent move by Pepsi Canada’s Mountain Dew to follow the American playbook to introduce a new product.  The DEWmocracy campaign from 2013 may have generated a surge in sales that would have made it difficult to match in 2014 without any promotional activity.  Repeating DEWmocracy in the following year risks tiring out the Mountain Dew consumer with identical consumer promotions.  Enter the 2014 “Backed by Popular DEWmand” promotion.  The DEWmocracy campaign equity is extended to the current year through the “Backed by Popular DEWmand” campaign without risking promotion fatigue.  Loyalists that previously chose Code Red, Supernova, or White Out can now re-engage with these flavors and vote for their preferred flavor.

The beverage brand also reaps another benefit by indirectly repeating this campaign.  Beyond the voting process, Mountain Dew can further understand the Canadian consumer’s taste preferences.  The four flavors from last year – Voltage, Code Red, Supernova, and White Out – were carefully selected to see which ones would appeal most to Canadians.  While Voltage (raspberry-citrus) was the most popular, Code Red (cherry) placed a close second.  Code Red has been produced by Mountain Dew USA since 2002 and was considered one of the brand’s most successful flavor extensions (via the Mountain Dew wikipedia page).  Based on this information, it is certainly worth giving Code Red another chance in the Canadian market.

Mountain Dew Canada brings back Code Red, White Out, and Supernova for Backed by Popular Dewmand Canada.

Mountain Dew Canada brings back Code Red, White Out, and Supernova for Backed by Popular Dewmand Canada.  Courtesy of facebook.com

With all the focus and support behind the Mountain Dew brand in the U.S., it certainly makes sense for the Canadian team to receive some additional.  Even if Code Red does not win this year, the citrus soda company may return again next year with four new flavors – possibly the Taco Bell Baja Blast flavor.  Once again, great marketing campaign that engages with the brand’s fans that also provides valuable benefits to the beverage.

Pepsi Spire’s Launch Fuels Competition and Innovation

Pepsi's range of the Spire. There are three different sizes and versions (1.1, 2.0, 5.0) to help customers cater to their consumers' needs.

Pepsi’s range of the Spire. There are three different sizes and versions (1.1, 2.0, 5.0) to help customers cater to their consumers’ needs.  From left to right: Pepsi Spire 1.1, Pepsi Spire Ice Dispenser, Pepsi Spire 2.0, Pepsi Spire 5.0 counter top unit, Pepsi Spire 5.0 freestanding unit, Pepsi Interactive Vending Machine, and Pepsi Smart Cooler.

Since 2013, Pepsi has been testing an interactive fountain unit similar to Coca-Cola’s Freestyle.  It looks like the testing is complete and they chose to launch the interactive fountain dispenser as Pepsi Spire (after trademarking Pepsi Touch, Pepsi Fusion, and Pepsi Smart Cooler).  The Pepsi Spire comes in three sizes offering restaurant customers up to 1,000 beverage combinations, here’s the media release from Pepsi.  It is currently available in over 50 locations in the U.S.  Spire’s launch comes nearly five years after Freestyle, but Pepsi has taken this time to tweak issues that were present during Coca-Cola’s launch: customer frustration and social integration.

Pepsi launched Spire with three different sizes, relative to Coca-Cola’s Freestyle launch in only one size.  This will certainly be pleasing to restaurant owners.  One of the initial concerns for Coca-Cola’s Freestyle was that some restaurant may not have strong enough customer traffic to justify the available flavor combinations.  This would exclude the Freestyle’s availability for smaller restaurant.  Having smaller units with fewer combinations solves this problem.  This leaves only the top flavors and most popular combinations available for the smaller unit (40 combinations for Pepsi Spire 1.1), and offers the broadest assortment for the largest unit (up to 1,000 combinations for Pepsi Spire 5.0).

Pepsi also understood that the “maker” movement is both interactive – and social.  Despite no direct mention of social media integration, Pepsi has demonstrated the ability to incorporate the usage of mobile phones, Facebook, Twitter and other social platforms with their equipment.  While it is widely understood that most dining experiences are social, Pepsi found a way to make this experience more inclusive with your peers.  Pepsi’s smart equipment also has the ability to provide the restaurant customer with popular beverage combinations at that location, further integrated social and local demographics.

Pepsi Spire 2.0 – the interactive fountain unit integrated with smart equipment to provide popular beverage combinations as well as real-time insights for restaurant owners.

The launch of Pepsi Spire has spurred Coca-Cola to improve the Freestyle.  Coca-Cola recently introduced a mobile app allowing users to share their drink combinations with other users and pre-mix drink combination to scan at the Freestyle unit.  Coca-Cola also announced two smaller Freestyle fountain units coinciding with the Spire’s launch.  To minimize market news and maintain a competitive landscape against the Pepsi Spire, Coca-Cola’s Freestyle has also introduced smaller Freestyle units that dispense 35 drink combinations or 80 drink combinations.

The Pepsi Spire’s adoption rate should be relatively quick given their unit size flexibility as well as their own customer exclusivity contracts.  Beyond customer push tactics, consumer trends and social integration will help pull the Pepsi Spire into more on-premise locations.

The Cola War heats up again with the arrival of Pepsi Spire, this time on the fountain unit frontier.

POM Wonderful and Coca-Cola sue each other

Courtesy of foodindentityblog.com.  Is the Minute Maid juice label misleading?

Courtesy of foodindentityblog.com. Is the Minute Maid juice label misleading?

The food & beverage landscape may undergo significant changes shortly if a lawsuit between POM Wonderful & Coca-Cola is decided in POM’s favor. POM is suing Coca-Cola for misleading packaging for its Minute Maid Pomegranate Blueberry juice.  The labeling suggests that the beverage is a 100% fruit juice flavored with a combination of five fruit juices.  The beverage contents are primarily apple and grape juice, containing only 0.3% blueberry juice, 0.2%. pomegranate juice, and 0.1% raspberry juice.

The crux is whether one organization can sue another for misleading labeling that was deemed permissible by the Food & Drug Administration.  The FDA has decided that the beverage contents and the name itself satisfies their labeling requirements.  That said, the governing body allows companies to name the product based on the flavor even if trace amounts were used to produce the flavor.  Volume quantification is not necessary for the product contents.  Linda Goldstein, a partner with Manatt, Phelps and Phillips prefaced the following to AdWeek (full article here):

“Depending on how the Supreme Court rules, the ramifications could be broad. This is a huge case for the food and beverage industry.  No one has asserted that Coca-Cola violated FDA rules and law. The issue is whether the FDA regulations are the floor or the ceiling. Pom says it’s the floor and that the label can still be misleading.”

Should this case be decided favoring Coca-Cola, the food & beverage industry’s product labeling practice is kept intact.  POM will have made an even larger name for itself and Coca-Cola will carry on business as usual.  In the end, this could serve as a win for both Coca-Cola and POM Wonderful despite the court ruling in Coca-Cola’s favor and everyone paying exorbitant legal fees (the case has been around since 2008).

If the court ruled in POM’s favor, this sets the stage for increased vigilance toward product package labels.  Beyond the direct impact where Minute Maid must augment the product label, other food & beverage products currently on the market will be availability for scrutiny.  According to Goldstein in the AdWeek article, the fact that it could lead to a class action litigation suggests that many products do not satisfy the labeling requirements.  The precedent would be set that an organization can reduce the competitor’s advantage by scrutinizing their packaging claims.  Will this ultimately lead more companies to sue other companies for the sake of labeling challenges?

The genesis of POM’s lawsuit was Coca-Cola’s introduction of this Minute Maid Pomegranate Juice at a lower price point relative to POM’s products.  Given Coca-Cola’s distribution and marketing muscle, it’s understandable that POM would want to level the playing field as much as possible.  However, be careful what you wish for.  POM is also currently in appeals with the Federal Trade Commission over their own misleading advertising claims (full article here).  Through all of this, both beverage organizations’ focus has been on reducing the competition’s advantage.  Let’s hope that they return to their core business functions sooner rather than later: selling refreshing beverages.

Powerade’s 2014 World Cup Campaign Highlights Real Heroes

Courtesy of endomondo.com

Courtesy of endomondo.com

I wasn’t following the 2010 FIFA World Cup close enough to notice when advertising started appearing, but it looks like Powerade and other advertisers want to get a head start for the 2014 FIFA World Cup promotions.  With the World Cup starting in June, Powerade has already released FIFA World Cup commercials.  Here’s the full-length 60-second ad found on YouTube that features both professional and amateur soccer players, launched on YouTube more than a month ago.

This commercial happens to be the first time that Powerade has featured amateur soccer players in a global campaign.  The Powerade advertisement includes five amateur soccer players selected from the U.S., Spain, and Brazil.  These individuals star alongside Spain’s Andres Iniesta, who famously put scored the winning goal in the 2010 World Cup.  Since the tagline is “There’s Power in Every Game”, it makes sense to include other soccer players at different competition levels to help forge a stronger connection to the sport and to Powerade.

Similar to the Procter&Gamble “Thank You Mom” campaign where mothers of Olympic athletes were highlighted to add more context, bringing in amateur soccer players helps humanize the athlete and focus on how they train and prepare.  More importantly, it shines a light on the different adversities athletes must go through in order to attain success.  The spot brings this adversity even closer to home, weaving a story line where the amateur soccer players and Iniesta encounter similar  events during the course of their soccer game.  As one player is tripped during a game, so is Iniesta during one of his games.  As another player is training or resting to prepare for a soccer match, so too is Iniesta.

As a global campaign, there is customization that caters to the local geography.   Powerade has created different backstories for each of the amateur athletes to run in key geographies.  Each player has a different theme that Powerade showcases to help them find their inner power and overcome a challenging situation.  They are featured in a two-minute video where the athlete discusses the challenges they’ve had to personally overcome.  The feature ends with a callout to publicize the theme each athlete represents.  With the U.S.’s Nico Calabria, the common characteristic is “Power in Purpose”.  For Brazil’s Haboubakar Amadou Conde, this theme is translated as the “Power in Determination”.  Spain’s Erik Flores is presented as the “Power in Confidence”.  With Brazil’s Marcelo Lyras, it becomes “Power in Preparation”.  And for Spain’s Karlota Planas, the characteristic is “Power in Pushing Yourself”.  These videos indicate that “Power” is represented differently for each athlete, and conveys the message that everyone defines their motivation in a unique way.

In some ways, soccer is an escape from their personal struggles.  Within these feature videos, Powerade describes additional themes that athletes must “Power Through” to get to their current state.  Athletes continue to defy expectations and failure, in addition to overcoming challenges that deter them from pursuing their goals.

Here’s one of the struggles that Powerade highlights, that of Haboubakar Amadou Conde.  Conde had to overcome language barrier, failure, and homelessness in order to continue playing soccer.

As companies continue leveraging on emotion in their marketing campaigns, the key to success  lies in execution.  If executed perfectly, the beverage brand can foster a strong and genuine connection with many viewers.  I believe this campaign to be well-delivered and creates the emotional link Powerade wants to create.  Check out the Powerade YouTube channel for the other feature videos.

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