Xtreme Juice Smoothies - Marketing Project

Introduction

In this Marketing Plan we will be discussing various topics of marketing that surround the juice industry. In part one, we will analyze the juice market as whole by studying their marketing environment carefully. We will be looking at prices, advertising expenditures, promotion and products offered. In part two, we will be introducing our company of choice, Xtreme Juice Smoothies. We hope to launch this company in the best way that we can by opening a franchise and amongst many other marketing strategies that we will like to implement and explain in detail.

Market definition

The juices market consists of the retail sale of 100% fruit juice (from concentrate), 100% fruit juice (not from concentrate), nectar (30%-99% juice), fruit drinks (0-29% juice), and vegetable juice. The market is valued according to retail selling price (RSP) and includes any applicable taxes. According to MarketLine Industry Profile report; Juice in the United States, September 2013, “Any currency conversions used in the creation of this report have been calculated using constant 2012 annual average exchange rates”

This industry primarily sells smoothies and fresh-made juices. A smoothie is a blended, sometimes sweetened beverage primarily made from fresh fruit or vegetables combined with ice. They may contain chocolate, honey, syrup, milk, yogurt or ice cream and have a milkshake-like consistency thicker than slush drinks. Some juice and smoothie bars offer add-ins, like soymilk, whey powder, green tea and herbal or nutritional supplements. Revenue from other beverage and food sales is included.

Market Segmentation

Geographic Segmentation

The United States accounts for 30% of the global juices market value.

United Stated Juices Market Geography Segmentation: $ million, 2012

Geography 2012 %

Europe 36,238.1 33.8

United States 32,156.6 30.0

Asia-Pacific 27,804.7 25.9

Rest of the World 11,078.7 10.3

Total 107,278.1 100%

(Adapted from MarketLine, 11)

(Adapted from MarketLine, 11)

Category Segmentation

100% fruit juice (from concentrate) is the largest segment of the juices market in the United States, accounting for 24.3%of the market's total value.

United States Juice Market Category Segmentation: $ million, 2012

Category 2012 %

100% fruit juice (from concentrate) 7,829.6 24.3%

100% fruit juice (not from concentrate) 7,739.5 24.1%

Vegetable juice 6,617.7 20.6%

Fruit drinks (0-29% juice) 6,439.0 20.0%

Nectars (30%-99% juice) 3,530.8 11.0%

Total 32,156.6 100%

(Adapted from MarketLine, 10)

(Adapted from MarketLine, 10)

Market Analysis

Size of Market

In 2012, the United States Juice market had a value of 32, 156.6 million. In 2017, the market value is predicted to be about 34,223.5 million, which is a 6.4% increase since 2012.

United States Juice Market Value From 2008 - 2012

Year $Million % Growth

2008 23,279.50

2009 32,319.00 0.10%

2010 32,254.70 -0.20%

2011 32,146.50 -0.30%

2012 32,156.60 0.00%

(Adapted from MarketLine, 8)

United States Juice Market Value Forecast From 2012 -2017

Year $ Million % Growth

2012 32,156.60 0.00%

2013 32,305.90 0.50%

2014 32,778.58 1.50%

2015 33,331.10 1.70%

2016 33,724.10 1.20%

2017 34,223.50 1.50%

(Adapted from MarketLine, 14)

Competitors in the Juice Industry

The number of competitors in the juice market is limited which reduces the rivalry in the industry. There are few substitutes for the juice market which consist of other nonalcoholic drinks, carbonated soft drinks, and bottled water. The top four leading players in the juice market accounting for 58.6% of the total market value are: (MarketLine, 21)

Dr. Pepper Snapple Group, Inc.

PepsiCo, Inc.

The Coca-Cola Company

Ocean Spray Cranberries

Competitors of Xtreme Juice

Based on our research, we have concluded that the top three competitors of Xtreme Juice are the following:

Jamba Juice

Tropical Smoothie

Smoothie King

As the basis for comparison we have annual sales for each company. It is evident how successful these companies are and we can conclude that Smoothie King is the competitor to beat.

Xtreme Juice Competitors Total Revenues

Company Annual Sales (Millions)

Jamba Juie 228.8

Tropical Smoothie 80

Smoothie King 362

Share of Market

The Coca-Cola Company is the leading player in the United States Juice market generating a 26.8% of the total market share. Below we see the percentage for the competitors and for “other".

United States Juice Market Share by %, 2012

Company % Share

The Coca – Cola Company 26.80%