Re-Energizing the Lemon-Lime Category


Advertising Age published an article last week detailing the marketing investments of Coca-Cola, Pepsi, and Dr. Pepper Snapple Group (DPSG) in the lemon-line soda category (link here).  Until this was mentioned, I actually had not noticed that there really wasn’t much advertising around Sprite, Sierra Mist, and 7up in Canada.  Sprite always appeared to be advertising because of their partnership with the National Basketball Association, so it doesn’t seem like they had not advertised at all in the past few years.  No Sierra Mist advertising in Canada because of DPSG’s agreement with Pepsi, but 7up itself has not done any advertising in the last few years.  The article reports that marketing dollars for this beverage category had shrunk 80% and the money was being reallocated to other beverage categories such as enhanced waters, energy drinks, and sports drinks.

However, all this is about to change (or in Sprite’s case, has changed already).  Driven by consumer insight that clear sodas are a healthier alternative than colored sodas (untrue, by the way), all three major beverage companies are reinvesting marketing dollars into the category.  In terms of product innovation, Sprite launched Sprite Green in 2009, while Sierra Mist will introduce Sierra Mist Natural later this year for the US.  Both drinks are naturally sweetened beverages (Sprite with Truvia and Sierra Mist Natural with sugar) to keep in line with the consumer trends searching for healthier alternatives.  7up had already reformulated to contain 100% all natural flavors, removing artificial flavors and preservatives in 2006.

Sprite has also launched a global integrated marketing campaign titled “The Spark” which began with Drake’s commercial seen above.  Sprite’s marketing campaign includes a music project as well as a film project, and will be marketed through TV, out-of-home, online, and mobile media placements.  The music project gives teens the ability to mix their own music and save it as ringtones or send to their friends, while the film project encourages teens to create their own mini-film through choosing the setting, plot, characters, and ending.  All these efforts tie in with their theme to “spark” creativity and sharing it with others.

courtesy of adage.comWhat about 7up?  Since Sierra Mist cannot be sold in Canada, consumers’ lemon-lime soda options are limited to Sprite, 7up, or private label brands.  Are there any product or package innovations coming from 7up?  Advertising Age indicated that 7up will be stepping up their marketing and will be spending $25 million in these last four months, but no idea if that translates over into the Canadian market.  I’m curious to see what 7up will do because there may not be a lot of leverage to build upon these remaining 4 months.  Holidays are normally a ramp-up for beverages, but Christmas usually sees Coca-Cola and Pepsi promoting their own core brands.  And with 8 months of the year past already without much brand exposure, what will 7up be spending their $25 million on the remainder of the year?  According to Nielsen market share data, 7up held nearly 6% market share in 2009, while Sprite held less than 4% during the same time period.  Despite the US market being larger, shouldn’t 7up invest more advertising into Canada to protect and increase their market share points since there is less competition here?  If nothing is done, 7up stands to not only lose market share to Sprite, but possibly its market leader status.

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