Vincor Case Study

PRODUCT/ POSITION:

        The following table provides an analysis of the pros and cons of the 5 concepts discussed.        

Product Chosen

After the discussion about the pros and cons of the available options, it is recommended that Kretz be more innovative and launch a beverage that consists of an innovative mix of fruit juice and tequila based cooler as the consumers favor both beverages as unique, flavorful, healthy and fun. The component of fruit juice will make the cooler less sugary and flavorful, an attribute that will drive consumers to drink the cooler again. Moreover, the fruit juice based cooler has the highest incidence rates for occasional drinkers (78%). Furthermore, as Exhibit 6 suggests that 85% of the total population surveyed is very likely to try real fruit juice coolers making this a favorite. On the other hand as seen in Exhibit 7, tequila based coolers have the highest incidence rate among regular drinkers (21%) which will make the blend of real fruit juice cooler & tequila a unique proposition in the market. Also, the addition of the gummy worm will indeed add to the catchiness and uniqueness of the proposed concept. To add, tequila is known to least affect the overall taste and also has less sugar, facts that will complement the real fruit juice cooler very well while maintaining the proposition offered by the real fruit juice cooler

In conclusion, the value proposition for the concept will be based on three factors:

1. Innovative (blend of 2 concepts along with the gummy candy)
2. Healthier option as the real fruit juice will contain less sugar
3. Higher likelihood of acceptance as real fruit juice cooler emerged as winner of quantitative research and tequila emerged as most likely accepted regular drink

Positioning: “A Fun and Youthful concept meant for the Adventurous. Very Gender-Neutral, Tasty and Less Filling catering not only to avid drinkers but also to the health-conscious!! :-) ”

TARGETING:

        The target markets or buyers of the new product would be liquor boards of all the Canadian Provinces such as the LCBO in Ontario, and the respective boards of other provinces in which there is great liquor consumption such as those of British Columbia, Quebec, Alberta, etc. Moreover, as bars and restaurants act as a channel for generating trial and awareness, they will be targeted too. The product will be launched in the Canadian market and from the analysis above, it is recommended that the target segment be students and youth in the age group between 19 and 26 catering to both males and females.

However, as per the usage & attitudinal study conducted by Synovate, approximately 56% of the Canadians with the ages of 19 years and above claim to drink more  of different types of the refreshment categories. This means that in order to fulfill their expectations, the target market should be selected to the non teenage group too. Having the proposed product (blend of real fruit juice + tequila) will more or less address this aspect.

 Most of the consumers fall under 44 years which constitute 58%     of the total consumers and 35% falling under 34 years, and the rest of the consumers constituting 41% fall from the age group of 34% - 45 years. So the target market should be so selected so as to JUST meet the expectations of mature consumers by not sidelining the teenagers.

It is also recommended that Project Twist target primarily at females as approximately 60 % consumers are females which consume refreshment.

PRICING:

        My recommendation to Kretz would be to follow a low-risk high-reward strategy in the immediate term (next 1 year). As per the response received to the blend concept proposed, Kretz would be well positioned to modulate the prices later above or below the original price (set now). In line with this strategy and to leave room for future price modulation, I recommend that the ‘Line Pricing’ approach would generate the best results because it gives the perception of similar quality to the market leaders.  A price of $9.45 would be a good offer keep in line with competitor products. Besides, the  Limited Time Offers (LTOs) of $1.00 discounts should be used to help ensure premium product placement (and shelf space in general) in LCBOs .

CARRIER & LABEL:

        Vincor already has the Vex brand in six-pack. In order to directly compete with Smirnoff Ice, Kretz must introduce a 4 pack open box carrier. A 4-pack carrier should be produced to keep price point In line with other coolers, since value is a major criterion.  The box will consist of an open-carrier design made of cardboard, containing brand logo & colors. The open design will offer visibility of the product and the bottle.  This will be colorful and aesthetic to view from a viewer’s perspective. Also open box carrier is easy to carry as compared to a closed box carrier and mainly due to the fact the liquor stores are self. An open carrier will display the product easily to the other passing customers too who may then be enticed into buying the beverage. Paper labeling is recommended because it is the easiest and cheapest option for our major target market comprising the youth.