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Text Preview SNAPPLE CASE

Table
 of
 Contents
 
Question
 1 ......................................................................................................................... 3  
Figure1.
 Stages
 of
 managerial
 approach
 towards
 market. ..............................................................................3  

Question
 2 ......................................................................................................................... 4  
Question
 3 ......................................................................................................................... 5  
Table
 1.
 SWOT-­analysis.....................................................................................................................................................5  
Table
 2.
 Depravity-­deprivation
 scale ..........................................................................................................................6  

 

Question
 1
 
In the period of 1972 to 1993, why do you think that Snapple flourished when so many small Start-ups premium fruit drinks stayed small or disappeared? I would highlight several roots of Snapple’s success on the market during first 20 years: A. The start-up of “Snapple” business was based on Demand approach. Founders identified growing popularity of natural fruit juices influenced by atmosphere of 1960s. B. They were developing their business in a consistent manner in accordance with its growth (see Figure 1):

a) Production concept – «100%
Natural», outsourced
b) Product concept – broaden
product portfolio, outsourced
product development
c) Selling concept –network of
distributors, mostly independent
ones distributing via cold
channel. Covering New York at
the beginning and expanding
throughout East Coast.
d) Marketing concept – hired
top-professional who improved
label design, invested in
promotion as an offbeat mix of
PR and advertising.
Figure1.
 Stages
 of
 managerial
 approach
 towards
 market.
 
Source: Andrés Cuneo. Marketing Course Wrap-Up (MBA ’13)
C. From the case we know that entrepreneurs were exiting start-ups through acquisitions as SoHo founders did in 1989. While “Snapple” founders preferred to develop the business on their own with help of hired professional. I believe it was half a battle that allowed “Snapple” to continue its growth in a consistent and coherent manner unlike competitors. D. “Snapple” was creating loyal and trustful relations with distributors by responding on their inputs/feedbacks, for example, broadening of product portfolio and introduction of commissioned advertising.

E. They were also creating trustful relations with customers by following their mantra of “100% Natural” in everything they did – from production to promotion concept. F. Approach to positioning and promotion of the brand introduced by Gilman was a success. By choosing Wendy, the truck dispatcher, that represented bottom-up popularity and in this way reflected company’s business journey from nowhere to success, as well as on-air endorsement in two shock radio shows, “Snapple” differentiated the brand from competition

and built a strong emotional connection with its consumers. That was proved in 1997 by New Jersey group survey, which showed that even after several years of failure people would still associate “Snapple” with its initial brand characteristics.

Question
 2
 
Now look at the period from 1994 to 1997. Did Quaker make an error in buying Snapple or did they manage it badly?
In my opinion, the acquisition was not a mistake. The failure was clearly the result of mismanagement. Below is a list of management decisions that lead to sales decline. A. Needs. Quaker introduced larger pack sizes for “Snapple” applying its Gatorade strategies. Since the moment of consumption was different for these two products (Gatorade – consumed when... Show More

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