Marketing Strategy Plan

VitaminWater
July 28, 2008
Introduction
In 2007, the functional beverage market reached $9.8 billion. From 2002-07, there was an increase in
the market of 30% at current pricing, and 14% after accounting for inflation. These numbers reflect the health
and wellness movement in the United States, as people are now trying to select healthier food and beverage
options. In 2002-2006, the number of people trying to eat healthier increased by 30 million. Ready-to-drink,
functional teas, enhanced bottled water and sports drinks are leading the way with use highest among
consumers ages 18-34, as well as among households with children. Many of those in this younger age bracket
see these drinks more as a hip, lifestyle beverage.1 These consumer select brands of beverages just as they
select the “in” brands of clothing. Market gains have to do with teens and young adults who flock to the
energy drinks and enhanced waters, as these consumers understand these drinks’ rebellious, taboo and/or
trendy images.2

Customers are now demanding more from the beverages. Instead of just being thirst quenching, these
drinks must have other perceived benefits.3 Water and vitamins are two essential substances human beings
need. What if by chance these substances joined forces? And so, Vitamin Water was born. Glaceau emerged
in 1996 as a "pioneer of the enhanced water category.” Glaceau developed a line of bottled beverages called
Vitamin Water, that combine distilled water with vitamins, herbs, and flavors. 4 In 2007, Coca-Cola Company
purchased Glaceau, for $4.1 billion. Glaceau was attractive to Coca-Cola because of its position in the
enhanced water category, which Coca-Cola wanted to enter. Coca-Cola is speculating this industry will
comprise a large portion of the beverage industry's growth in North America through 2010. 5” “The strategy
for the makers of Vitamin Water was “to exit after four years, not to go on as long as it has,’ said one source
familiar with the inner workings of the Whitestone, N.Y.-based company”.6

1
Mintel Reports:Functional Beverages - US - August 2007
2
Mintel Reports:RTD Non-carbonated Beverages - US - June 2008
3
Mintel Reports:RTD Non-carbonated Beverages - US - June 2008
4
http://recipes.howstuffworks.com/vitaminwater.htm
5
http://www.foxnews.com/story/0,2933,275386,00.html
6
http://www.brandweek.com/bw/news/foodbev/article_display.jsp?vnu_content_id=1002951087
Executive Summary

VitaminWater is a powerful brand that has many strengths in its overall marketing strategy. For one, it
has strong brand positioning where it targets a large demographic???., and claims to work for “celebrities,
soccer moms, superheroes, and you”.7 It is known as a stylish product with its bright and cheerful colors as
well as its humorous sayings on each bottle. VitaminWater also engages in local and mass promotional
activities. These are fun and catchy to correspond with the overall brand image. VitaminWater is marketed as
well as sold in multiple locations, so it can easily be found and kept top-of-mind. This “Nutrient enhanced
water” has a lot to offer to its customers,8 both in terms of real and perceived value.

Although VitaminWater has many positive qualities in its marketing strategy, it is left with some
negative ones, as well. For one, there is only one product line, and it has not yet been expanded upon.
Currently, VitaminWater is a product brand, rather than a lifestyle brand. Several line extensions should be
evaluated in order to grow the brand, and build consumer loyalty. Its bottles are fun and colorful; however,
with its focus on bright pinks and purples, statistics have shown that this drink is purchased by more females
than by males. Further, VitaminWater is said to be “a great tasting, natural, low calorie (50 calories per 8 oz
serving), nutrient packed enhanced water”. 9 Little does Glaceau tell customers, though, about the high sugar
content. Vitamin Water is marketed “for people who want something healthier than the stuff they’ve been
drinking to meet their needs throughout the day”.10
While VitaminWater started out building a strong brand, and has acquired an almost cult following.
The questions that remain: How can VitaminWater maintain its market share in an increasing consumer
product segment? How, if at all, should VitaminWater expand its current offerings to promote a lifestyle brand
versus a single product, fad?

7
VitaminWater slide
8
VitaminWater slide
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VitaminWater slide
10
VitaminWater slide
Market Analysis

Company Background

Energy Brands, Inc. was founded in 1996 by J. Darious Bikoff. It is based in Whitestone, New York.
As of June 7, 2007, Energy Brands, Inc. became a subsidiary of Coca-Cola Co. The Coca-Cola Company had
been looking to expand its portfolio. They bought VitaminWater maker Glaceau in a cash deal valued at $4.1
billion.i Some analysts say that 4.1 billion was a hefty price to pay to gain market share of the emerging
beverage segments. Other analysts say seeing the fourth straight year of triple-digit volume growth was not a
bad price to pay. Glaceau will continue to grow rapidly by utilizing Coca Cola’s well developed mass
distribution system. VitaminWater is available in North America and recently launched in Australia.

Energy Brands, Inc. offers flavored vitamin water drinks. It has four main product lines under the
Glaceau brand: VitaminWater, SmartWater, VitaminEnergy, and FruitWater. Due to rising obesity rates and
complications such as diabetes resulting from being overweight have led consumers to seek healthier
beverages. Energy Brands, Inc. was very successful at marketing its VitaminWater as the value-added health
drink alternative, and created a new category in the beverage industry called enhanced water. VitaminWater is
the leader of the enhanced water category.

According to Energy Brand, Inc.’s website “it all started when one thirsty man named Darius wanted
better water, but couldn't find any worth drinking, so he decided to make his own. Along came a guy from
Queens named Mike and because Mike has a gift for gab, it's no wonder word got around, thus emerged
Glacéau, a fresh new approach to bottled water. Today Glacéau, the creator and leader of the enhanced water
category, is the maker of vitaminwater®, fruitwater®, smartwater® and vitaminenergy™. Now, with 1,000+
full and part-time employees. Glacéau is all about helping thirsty people like you hydrate responsibly with
products that are free of sodium and artificial ingredients. It means no artificial sweeteners, no artificial colors
and especially no artificial intelligence”.ii

Industry

Economic Factors

Many people believe that U.S. economy is in a recession. There are many economic factors to validate
the belief. According to Bureau of Economic Analysis, GDP growth slowed to just +0.9% in the first quarter
of 2008, and consumer confidence dropped to 57.2 in May- the lowest level in 16 years. The foreclosure rate
continues to rise while the house price continues to drop. In many parts of US, the average price for unleaded
gas is well over $4 per gallon. Consumer’s discretionary spending budget is shrinking, and more people are
paying for food and fuels using credit cards. The U.S. Department of Labor's Web site offers an inflation
calculator that shows the buying power of a dollar throughout the years. What cost $1 in 1980 will cost $2.63
today, and what cost $1 in 1990 will cost $1.66 today.

Market Trends

In the Unites States, consumers are becoming more and more health conscious and the shift towards a
healthier lifestyle also changed their purchasing behavior for food and beverages. More and more carbonated
soft drink drinkers are seeking alternative beverages with health and wellness positioning. Beverages like
VitaminWater are perfect for consumers who are seeking value added benefits without be concerned with
calorie intake.

According to Mintel, “Rising obesity rates, 66% among adults and 32% among children aged 6-19, and
complications such as diabetes resulting from being overweight/obese have led many Americans to seek
healthier food and beverage choices including curbing consumption of high-calorie/high-sugar soft drinks and
juices. Mintel’s exclusive research shows that concerns about general health and about weight are the most
cited reasons among 40% of all regular soda-drinking respondents, who are drinking less soda as compared
with a year ago.” Carbonated beverage volumes continue to decrease while beverages with health and
wellness positioning are on the rise.

Non-alcoholic Beverages: The Market - US - April 2008 - Market Drivers

Figure 18: U.S. per capita consumption of carbonated soft drinks, bottled water, and sports drinks, 2001-06
Years Carbonated beverages Bottled water Sports drinks
Gallons % change Gallons % change Gallons % change
2001 54.3 -0.4 19.3 8.4 2.8 12
2002 54.2 -0.2 21.2 9.8 3.1 10.7
2003 53.8 -0.7 22.1 4.2 3.2 3.2
2004 53.7 -0.2 23.8 7.7 3.4 6.2
2005 52.7 -1.9 26.1 9.7 4.1 20.6
2006 50.4 -4.4 27.6 5.7 4.5 9.8
Source: Mintel/Beverage Marketing Corp./Beverage World

Carbonated soft drinks not only saw a continued decline in their volume last year, but those categories
are losing market share to the newer emerging categories, especially those with a health and wellness
positioning like the flavored and enhanced water. As it is shown in the chart, beverages that are associated
with a healthy image drove the growth of the beverage industry. Flavored and enhanced water is up 30.6%.

Competition

The competition in the beverage industry is fierce. Every year beverage companies are introducing a
considerable number of new products or line extensions to stay competitive. The beverage aisles are getting
overly crowed with different products for consumers to choose from. Companies that come up with product
innovation driven by health/wellness and convenience propositions are more likely to see more than an
average volume growth. The Mintel figure below shows the number of new products launched in the U.S.
during 2002-07, with first quarter data for 2008. The bottled water category ranked highest in new product
introduction for past three years.

* March 2008 Consumer Choices in the Beverage Aisle - US - April 2008 - Innovation and Innovators
Source: Mintel GNPD

The direct competitions of VitaminWater are Gatorade Propel, SoBe Lifewater, Aquafina Alive,
Snapple Antioxidant Water, Skinnywater, Kellogs K2O and Fruit2O. Both Gatorade Propel and Sobe
Lifewater are distributed by Pepsico, and it is the biggest competitor of Coca Cola Company. According to
BevNet, Propel and VitaminWater combined account for 69 percent of the total enhanced water category.

The two companies are in direct competition with each other by showing the consumers better value
added product features and benefits. “Pepsi has launched ads that point out that its Propel Fitwater has fewer
calories than Glaceau's Vitaminwater — 25 calories for Propel compared with 125 calories for Vitaminwater
per 20 ounce bottle. PepsiCo also has put more emphasis on SoBe Lifewater, another Glaceau competitor.
Glaceau's head of marketing, was quick to point out that Vitaminwater, unlike Propel, uses all-natural
iii
sweeteners.” According to BevNet research, Propel scored higher marks on most brand equity questions,
including “easy to find,” “fun to drink,” and “good value.” VitaminWater also offers functionality and flavor
that beats the competitions. As the ingredient chart shows below, VitaminWater has different vitamin content
across all flavors. However, Sobe Lifewater provides same vitamin content across all flavors.
 Pomegranate Orange Passionfruit Strawberry Blackberry
Cherry Tangerine Citrus Kiwi Grape

Source: www.sobelifewater.com, www.glaceau.com

Product Features and Benefits:

VitaminWater:
• Vitamin enhanced water with natural ingredients.
• Contains 125 calories per 20oz with no sodium.
Sobe Life Water:
• Vitamin enhanced water sweetened with sucrose, no artificial sweeteners.
• Contains 50 calories per 8 oz. Also contains 13g. carbs, 25 mg. sodium per 8 oz.
Kellogs K2O water:
• Provides 5 grams of protein per 16 oz & 8 grams of sugar.
• Contains artificial sweeteners and has 50 calories per bottle.
Propel Fitness Water:
• All 8 flavors of Propel contain 10 calories per 8 oz.
• Contain 3 g. of carbohydrates and vitamins and minerals.
Customers:
The target consumers for VitaminWater are people “who want something healthier than the stuff
they’ve been drinking to meet their needs throughout the day.”11

SWOT Analysis
Opportunity:
• Consumption of soda has declined from 2003-07, consumers are looking for alternative beverages with
health and wellness positioning like vitamin water alternative beverage choices.

11
VitaminWater slide
 • VitaminWater as a hip, new age beverage is attracting the youngest adult consumers who feel the
product better represents their image and lifestyle.

• The “trendy” beverages like vitamin water have become more popular.

• As hip, new-age beverages, these NCBs attract the youngest adult consumers who might feel these
products better represent their image and lifestyle.

• Older consumers are seeking products that give them extra boost and products that make them feel
young and healthy.

Threat:

Competitive Advantage

Target market:

Vitamin enhanced waters are specifically targeted and marketed towards health oriented consumers
and hipsters in generations x and y. Market research has shown that bottled water is the U.S.’ fastest-growing
“refreshment beverage,” with 2006 bottled water consumption increasing 9.5% from the year before.12
Beverage Marketing predicts that by 2011, bottled water’s share of the liquid refreshment beverage market
will be 29%, while soda - which currently holds about 42%, will dwindle to 34% that year.13
Even as Americans are drinking bottled water like never before, enhanced waters such as
VitaminWater are the fastest-growing part of that market - to the tune of $245 million wholesale last year, up
from just $20 million when they debuted in 2000, according to research by Beverage Marketing Corp. in New
York. And those who are their biggest fans are health-conscious young adults and baby boomers in trendy
urban areas such as New York and San Francisco.

Positioning (key differentiators)

Energy Brands' Glaceau VitaminWater is scoring in the “hipness” market, with a dozen drinks in a
rainbow of colors, each with a name that promises more than thirst relief - "determination," "focus" and
"rescue," to name three. Heather Dupree Director of Innovation at Kindred Keziah stated, "Vitaminwater has
hit those three prongs (physical, emotional and spiritual) by balancing the spiritual need of overall health and
wellness with the physical of refreshment and the vitamins that you need, plus the emotional with the
packaging having words on it that are cheeky and fun. I think it's one of the best new product introductions
that I've seen in the last few years.14”
Energy Brands, the parent company of Glacéau, advocated healthy living through low-calorie, low
sugar drinks, and non-carbonated water with additional nutritional supplements. Energy Brands was credited
with creating a new category of drinks popularly known as 'enhanced water products.' According to analysts,
Glacéau's success in a scenario in which major soft drinks and beverage manufacturers like Coca-Cola and
Pepsi had a strong hold over the distribution network and spent aggressively in marketing their products,
illustrated that even the most saturated markets could accommodate innovative products.

Competitive Advantage – Analysis and Conclusions:

How a competitive advantage is created and sustained:
After the acquisition of Glaceau brand by Coca-Cola, Pepsi formulated a strategy to directly compete
against VitaminWater- the name design (VitaminWater vs. Life Water), the packaging, the idea - it's all there to

12
http://www.sanangelolive.com/node/495
13
http://www.influxinsights.com/blog/article/1372/coke-to-buy-vitamin-water.html
14
- Heather Dupre, Director Innovation, Kindred Keziah, in 2005
capitalize on the fact that Glaceau is doing semi-revolutionary things with drinks. As Glaceau’s VitaminWater
was at the forefront of market innovation they were able to securely position themselves as market leader
amongst new competitive entrants. They were able to draw upon many different layers of marketing schemes
to attract consumers. It wasn’t just purely on the taste factor that attracted people, but it was more of the sense
that the VitaminWater brand was able to convey a whole beverage drinking experience. What worked for
VitaminWater was their ability to package and advertise their product as non-threatening, fun, and light-
hearted and attract those consumers who valued those similar interests. All enhanced waters have water as the
main ingredient. The subcategories vary more in marketing styles than in substance.

The company was able to transcend the enhanced water appeal to the core American desire for
something "more," according to Tom Pirko, president of BevMark, food and beverage consultants in Santa
Barbara. Americans turned to bottled water "not because we don't think our tap water is safe -- it has more to
do with what else you can get." Executives for the enhanced waters tout them with words like "health," "pure,"
"natural," "two-in-one drinks" for consumers "who want more than pure hydration." Coke's Gloria Garrett
described them as "emotional and functional" in a recent Beverage Industry trade magazine. People don't drink
enough water because they get bored -- but they'll drink more if it’s fun and flavored. People today are making
purposeful choices about how they live and what they put in their body. They're fundamentally seeking a
healthy lifestyle but not at the cost of giving up taste and variety.

The perfect element is that VitaminWater is the consummate answer for a lot of people who are tired of
just drinking plain water. Subconsciously, a lot of people realize that drinking water and taking your vitamins
has more benefits than gulping down a drink that is infused with artificial sugar and the promise of supposed
vitamin enrichment. However, it is the culture that we are in allows one to compensate the fact that while
drinking water and vitamins is essentially the better alternate than drinking VitaminWater, its justification is
balanced that drinking VitaminWater is much better than drinking a carbonated soft drink with over twice the
sugar content and no added vitamins. This shows that people crave for something of the lesser evil, and
VitaminWater’s mass appeal has the contributing factor that allows them to be a safe-bet of the vitamin
enhanced beverage category in the market.

Competitive Advantage - Recommendations

• Sustainable growth follows the path of constant product innovation. Like most consumer products to
remain relevant in the quick changing palette of consumers, one must constantly think forward. As the
company has brought forth 13 different flavors that are geared to satisfy and cater to specific
functionalities, VitaminWater has to think of other innovative ways to keep a “top of the mind”
reference when people are going to be purchasing a vitamin enhanced water.
• VitaminWater lacks the specific focus that it needs to truly understand who their target market is going
to be. They only recently have just begun to have “tween” oriented female musicians, hard hitting
athletes, and rap musicians endorse their product. As they seem to be trying to covet a mass brand
appeal to many different consumer tastes, they may alienate those consumers who feel that they should
not been seen in the same light as the endorser may portray. Although, their approach is more in the
sense that they want it to be a key element that unites all different types of genres in liking the
VitaminWater brand. However, if they truly understood what market segment to push their products
toward, they would be able to better satisfy those consumer needs and hopefully gain insight of what
they want in the long run. The outline below helps break down a simplified version of the
Segmentation Variables:

Segmentation Variables:

Demographic
Consumer
• Family income 30k-100k, M/F, diverse ethnicity and educational background
Industrial
• Buying processes- point of purchase, wholesale, retailers, mass merchandisers
Geographic
• Product preferences- varied products, 50 Cent endorsement catered to the urban market
 • Market potential- emerging and long-term growth
• Competition- new entrants and fierce competition to capture market share
• Distribution- high access internationally via Coca-Cola’s presence
Psychographic
Consumer lifestyle
• Healthy, fun, lighthearted, educated, sense of humor, conscientious, environmental, witty, risk
takers
Product use and application
Consumer
• Purchase purpose: satisfy thirst, vitamin enhanced water substitute, health conscious, pop
culture enthusiast, trendsetter
 COMPETITOR ANALYSIS

Company Background Unique Selling Positioning/ Points of Points of Marketing Distribution

Point/Products Target Market Parity Difference Strategies
● Formed 1996, ● Pioneer and ●18-49, peak ● Bottled water ● 15 functional ● Focus on ● Sold at retail
headquarters in New leader in the positioning is 35- ● Likeness is varieties with branding image not outlets, natural
York enhanced water 49 similar with other unique as a sports drink food and specialty
● Under parent category ● 60% of drinkers brands combination of but as a health stores in more than
company Glaceau ● Fastest growing are female ● Market can be nutrients vitamin 45 States
● Bought by Coca- bottled water brand Caucasian saturated ● Bottle design replenishment nationwide
Cola Company in the industry ● College graduate ● Unpredictable ● Ingredients ● Positioned next ● Introduced
● Several line ● First in sales in with income range demand/fading to the water bottles overseas in
extensions including the enhanced water of 30k – 100k trend products Australia and the
SmartWater, category UK
FruitWater
● Founded: 1966 by ● Backed by 40 ● 18-49, peak ● Offers an array ● Heavy research ● Brand culture ● Parent brand
researchers at the years of research positioning is 35- of 11 different focus on hydration focus on sports Gatorade available
University of Florida ● Proven benefits 49 flavors ● Sports medicine related activities in 80 countries,
● Purpose was to of rehydration over ● 55% of drinkers ● Replenishment and the attributes with the sold at retail
prevent dehydration water are female drink that help the body association of main outlets,
on sports team ● Expertise in Caucasian with no ● Low calorie replenish fluids brand Gatorade supermarkets, mass
● Pepsico owned rehydration and children drink ● Parent brand has ● Aligns itself as a merchants,
company sports nutrition ● Income range ● Vitamin a heavy sports forerunner of convenience stores,
over all beverage from 0k- 60k with enhanced sponsorship industry trends in and warehouse club
companies 50% college rate ● Lightly flavored sports liquids: stores nationwide
● Market leader created Gatorade
Sports Science
Institute
● South Beach ● Reformulated ● 12 - 50+, peak ● Vitamin infused ● Cheaper unit ● Use of sports ● Sold at retail
Beverage Company with sucrose, demo 12-17 drink price over figures, celebrities, outlets,
(SoBe) antioxidants, ● 52% of drinkers ● Variety of VitaminWater so superbowl ads, supermarkets, mass
● Manufacturer of vitamins, and are male different flavors cut into their gecko trademark to merchants,
teas, juices, and natural herbs ● Income range ● Low calorie market share push the brand convenience stores,
energy drinks ● 35 calories per from 0k- 60k with ● Direct approach and warehouse club
● Subsidiary of serving 43% college to compete with stores nationwide
Pepsico in 2000 graduate rate VitaminWater:
● Founded in 1996 in reversed engineer
Connecticut to the exact
molecule

Company Background15 Unique Selling Positioning/ Points of Points of Marketing Distribution

15
http://
 Point/Product Target Parity Difference Strategies18
s16 Market17
● Aquafina is the No. ● Uses PepsiCo's ● 12-50+, peak ● Low calorie, ●Carries a "smart ● Name clearly ● Sold at retail
1 bottled brand in the own purification demo at 50+ vitamin-enhanced spot" to indicate shows the outlets,
US in 2003 system, which it ● 62% are female water beverage that it is a smart consumer the supermarkets, mass
● Alive is a product calls HydRO-7, Caucasian ● Fitness water choice for the product benefit- merchants,
extension of the that includes ● 69% have no ● Flavored variety health-conscious satiety convenience stores,
Aquafina line charcoal filtration, children under the consumer. ● Build on brand and warehouse club
● Subsidiary of reverse osmosis age of 17 ● Bottle labeled heritage stores nationwide
Pepsico and ozonation. ● Income range that the water ● Identified as
● First distributed in ● Has 10 $0k – 60k originates from “nutrient enhanced
Kansas in 1994 calories and public sources water beverage”
10% ● Bottles are ● Film festivals are
DV of fiber to packaged in the the sampling
help lightly fill same shaped bottle venues of choice
you up. as regular Aquafina for the new
water Aquafina Alive

● Founded in 1972 in ● Features seven ● 12-49, peak ● Lifestyle vitamin ● Packaging too ● Brand slogan is ● Sold at retail
New York unique flavors demo 12-17 infused drinking different from what "Made from the outlets,
● Snapple is derived inspired by ● 60% Female beverage people were best stuff on supermarkets, mass
from a carbonated nature’s ● Diverse ethnic ● Frame of accustomed to Earth." merchants,
apple soda “superfruits,” consumer base reference that ● Move away from ● Early Snapple convenience stores,
● Acquired by including ● Broad consists of all juice flavored campaign featured and warehouse club
Cadbury Schwepps pomegranates and educational level: thirst-quenching drinks Wendy the Snapple stores nationwide
Americas Beverages acai berries. The high index of drinks lady
antioxidants, graduates and post- ● Paid $100
vitamins and graduates million to sponsor
electrolytes in each NYC school
flavor provide one system and have
of four their vending
distinct benefits for machines replaced
the body by Snapple

16
See Appendix B for examples of competitor product
18
See Appendix C for examples of competitor advertising asset
17
http://www.quantcast.com
Brand equity:
Key elements in the brand:
Glacéau was able to successfully brand VitaminWater as a health drink by honing down
on an effective marketing and distribution campaign. The company based their core product line
by having vapor-distilled water, and infused their VitaminWater branded drinks with electrolytes,
which are ions of sodium, chloride, potassium, calcium, magnesium, phosphate and hydrogen
carbonate. Glacéau's brand positioning is aligned by having a clean look, upbeat attitude, and
humorous “tongue in cheek” tone of voice. The label packaging text is lower case, cheeky and
confident as well. Bottles are adorned with "one sip, swing or gulp may result in boycott of other
beverages." Color use is bright and vibrant, reflecting the refreshing quality of the product.

Value:
With the association, leverage, and resources Coca-Cola has to offer VitaminWater has
the potential to reach many people in many different types of markets. Coca-Cola likens to build
an international market out of a brand bought by celebrities like Cameron Diaz, Ben Affleck and
Madonna. The celebrity endorsement will help strengthen the value of the brand and hopefully
create a long term brand association amongst consumers. Chief operating office of Coca-Cola
Muhtar Kent said: "This is an outstanding opportunity for both of our companies to build an
expanded active lifestyle business, first in the United States and then around the world."19

Strengths:
Glaceau boast on its labels and website the motto "vitamins + water = all you need."
Various labels of VitaminWater carry energetic names, and are stated to contain fruit and
vegetable extracts, or vitamins. A grape label, Formula 50, is endorsed by rapper 50 Cent. It's
creative labeling and prints on the bottles give the brand more appeal to consumers whom enjoy
humor. Its "balance" flavor is recommended for "clowns who ride unicycles while juggling
chainsaws;" and the "endurance" flavor contains the warning "usage may result in increased
stamina.”

Their online presence reflects the same brand outlook: vibrant, humorous, and confident.
A user can choose a bottle amongst the many flavors, the product jumps straight up, produces a
tune, and displays a quirky Q&A based on the selected drink. For example, we learn that the fruit
19
http://www.guardian.co.uk/business/2007/may/26/4
punch VitaminWater, called "revive," contains vitamin B and potassium. The exchange of
question and answers typically flies at this level: "q: if I put revive in my fish tank will my
goldfish wake up? a: we don't believe in animal testing." A click on the bottle brings up a
facsimile of the "revive" label, complete with barcode.

Weaknesses:
Actual sugar content and serving size per bottle is a concern for many consumers. While
Vitaminwater contains fewer calories per serving than many sodas, it is still loaded with sugar
and/or corn syrup. And although an 8-ounce serving contains no more than 66 calories the actual
serving size is 2.5: leading a total calorie of 165.20

VitaminWater lacks the foresight to advertise to a large over 50 demographic. According

to a new study by Sweeney Research, only 23 percent of 45 to 54 year olds said advertising was
in tune with their needs or entertaining to watch. Points of contention included images of smiling
retirees strolling around retirement villages, young people used in ads, over-55s depicted as
“old,” and ads that are perceived as speaking down to the elderly. An overwhelming majority
(84%) of respondents (aged 45-54) said they were more likely to take notice of ads that showed
situations they had experienced in real life. Ninety-nine percent said they appreciated ads that
were humorous and light-hearted.
How effectively the brand is managed:

This is a great move for Coke because VitaminWater seems to be delivering the right
experience for today’s generation of soft drink consumers; its water based, but not as boring as
water and has a “natural” profile.
VitaminWater is first and foremost a success story built around a smart product
formulation, great packaging and smart distribution. The product was launched in 2000, but only
started advertising and using celebrity endorsers in the last three years.

20
http://www.marksdailyapple.com/coke-pepsi-cadbury-schweppes/

18
Recently, Outlaw Consulting conducted a survey to discover the most trusted brands amongst
Generation Y “trendsetters”, Vitamin Water ranked 14th, just behind Converse and ahead of Red
Stripe.21

Analysis:
Baby boomers are not out to hijack the genuine culture of youth. Instead they are
interested in a youthful way of life, the recognition that being young is a state of mind, and in a
physical, turbo-charged approach that allows you to bend and stretch well past your 40th birthday.
The most successful advertising campaigns targeted at mature consumers focus on active
and healthy lifestyles and introduce positive role models. Even the youth-obsessed cosmetic
industry (Lancôme ditched Isabella Rossellini as its model because she was considered too old at
42) is getting better at portraying women over 50. Since such women make up over half the
market for face cream in developed countries, it’s a wise move. In 2001 L’Oréal recruited the
then 57-year-old French actress Catherine Deneuve to promote its hair care products (she refused
to have her physical imperfections airbrushed out of the advertisements).
Such initiatives, however, remain the exception, not the rule. Most companies are only
just waking up to the impact shifting demographics will have on consumption. While some fret
about the old age demographic time bomb, others are investigating the possibility that the next
wave of pensioners simply will not act like, well, pensioners, but more like teenagers. Those that
choose to ignore the over-50 opportunity are ignoring a global redefinition of age, but more
importantly, a looming social gerontocracy that will decide their survival in the marketplace.

Recommendation:
From the current advertisement schemes it appears that the appeal of VitaminWater is
geared towards crossing over into unsuspecting and unfamiliar approach in reaching their
demographics. As an example, in an advertisement by rapper 50 cent plays a conductor to a large
classical symphony that plays his hit song “In Da Club” while basketball player LeBron James
plays a successful defense attorney. Clearly both stars are out of their professional element that
they are known for, but VitaminWater’s strategy to transcend urban, hip hop, tween, borders is on
the right path to create an image of “anything is possible” mentality.

21
http://www.influxinsights.com/blog/article/1372/coke-to-buy-vitamin-water.html

19
 As the purchasing power of the over 50 is something gravely something to consider, it is
important to distinguish the clear role as to how VitaminWater should tap into that market. As the
baby boomer generation can identify with a lot of cultural aspects, they don’t see themselves as
being irrelevant and “old” past a certain age. In fact, more see themselves as “50 is the new 30”.
If consumers see that the brand is depicting themselves as old they would be more reluctant to
purchase the product. Therefore, in a scheme of building brand equity VitaminWater must
develop an advertising campaign that people over 50 can identify but not necessarily think that is
geared toward them.
Campaign ideas would include using notable stars from the 70s like Alice Cooper, the
members of KIIS, Roger Daltrey in various comical scenes that people wouldn’t necessarily
associate themselves with. The company has been successful with the likes of their crossover
commercial advertisements and should continue the theme of using humor to attract potential
customers.

Customer Loyalty and Retention

Description of Current Tactics:
Glaceau’s VitaminWater has a strategic dependency on high levels of customer loyalty,
customer satisfaction, and customer advocacy in order to both drive new customers to the brand,
as well as to promote customer retention among current purchasers. This is especially important
as the enhanced water category moves from having a single player, to many.
VitaminWater’s goal: To turn tryers into buyers into “addicts,” as loyal fans of this
fantastically fruity beverage line call themselves. Since VitaminWater launched in 2000, it has
focused its awareness building tactics on more grassroots and interactive approaches, such as
sampling and interactive engagements (online games, in-person giveaways, etc.), as well as on
quick-witted bottle messaging that keeps consumers spreading the word and coming back for
more. This initial low key strategy gave early customers the feeling that they “discovered” the
product, thereby increasing their psychological investment, and therefore loyalty in the brand.
While promoting awareness was heavily addressed in VitaminWater’s early stages, there was no
initial or strategic focus on continued customer loyalty until recently.
Today, VitaminWater interacts with its consumers in unique and surprising ways to
promote loyalty. For example, the brand recently ran an interactive Facebook campaign that
encouraged customers and potential customers in the Generation X and Y demographic segments

20
to pass Vitamin Water along to their friends in this virtual environment. In just one week, the
VitaminWater brand was shared around the community almost ten million times. Enhancing
relationships is also key to the brand’s current retention efforts. VitaminWater’s “Customer of the
Day” program, for example, rewards loyal fans for reaching out to the company via email,
phone, etc. Surprises like this keep customers coming back, and telling their friends, and in the
case below, spreading the word on YouTube!

Letter to the “customer of the day”. Free drinks, hats, and stickers for loyal customers.

Further enhancing the consumer relationship, VitaminWater recently revamped its

website to provide a more consumer-friendly and interactive brand presence that promotes word-
of-mouth communication. Here, visitors can take a quiz to find out what VitaminWater flavor
they are, play a VitaminWater game, download wallpapers, watch current television ads, and
even turn their IM icon into a VitaminWater bottle. In essence, VitaminWater is encouraging
customers to incorporate the brand into many areas of their lives, and customers are excitedly
doing so.

Interactive elements on VitaminWater’s website:

As a result of this recent push for consumer loyalty, VitaminWater has been so successful
that customers have been known to start blogs if they detect that one of the beverage colors or
21
flavors has been adjusted ever so slightly. These “addicts” reach out to others, thereby creating
an almost cult-like community around VitaminWater. Measures, such as the annual Brand Keys
Customer Loyalty Engagement Index, offer support that the brand’s tactics are working.
VitaminWater ranked #2 in terms of bottled water brands with the highest customer loyalty, as
displayed in the ranking below:

2008 Brand Keys Customer Loyalty Engagement Index; Bottled Water Category:
1. Aquafina/Fiji (tie)
2. VitaminWater
3. Poland Spring
4. Dannon
5. Arrowhead
6. Volvic
7. Evian
8. Deer Park
9. Dasani

Customer Loyalty and Retention – Analysis and Conclusions:

● VitaminWater’s strategy around driving customer loyalty and retention has been apparently
successful, although the strategy has centered around Generation X and Ye. The next generation,
Millenials, should be considered in upcoming loyalty-promoting tactics, as many of these
advertising-overexposed individuals may begin building brand preferences and loyalties early on
that will also affect their preferences and purchasing habits in the future.

● Much of the loyalty is likely derived in part from the excitement generated from the overall
newness of the product. While VitaminWater did originate the enhanced water category, many
other brands are stepping in, and today’s increasingly fickle customer is difficult to tie down to
one brand for long periods of time. Additionally, VitaminWater can also be considered today’s
fad, and who knows what tomorrow’s fad may be. VitaminWater may be able to outlive this
image, but they must be pro-active in doing so.

● VitaminWater launched with the premise that it is a healthy beverage. As a result, many
consumers switched from carbonated soft drinks, to enhanced water beverages, like
VitaminWater. Recent news coverage surrounding the unhealthy qualities of VitaminWater, are

22
surfacing. VitaminWater’s sugar and calorie levels, for example, have recently been publicized in
both competitor advertising and in health publications. If many initial consumers began drinking
VitaminWater for the health benefits, this may lower the rate of customer retention that the brand
currently enjoys.

● While programs, such as the “Customer of the Day” program, reward the loyal VitaminWater
consumers and advocates, it is unlikely that programs like this can last more than a couple of
years without either becoming stale or costly. Therefore, continuously coming up with new and
surprising ways to reach out to the “fans” will be an essential driver of loyalty and retention in
the next few years.

● VitaminWater gained its large market share and initial consumer loyalty through its first mover
advantage. With so many competitors now on the market, it may need to more aggressively
approach its consumer retention. For example, many carbonated soft drinks “under the cap”
games bring increased loyalty and retention (consumers need to continue purchasing one brand
or another in order to accumulate points, etc.), as well as a drive to the brand’s website for
further engagement. Additionally, VitaminWater is not proactive about capturing consumer
information (other than through grocery store club card transactions), in order to communicate
with them about new products, garner feedback, etc. It is much easier to retain customers if you
know who they are!

Customer Loyalty and Retention - Recommendations:

As VitaminWater is the “inventor” of the enhanced water category, it is able to draw
customer loyalty from this authenticity, as well as from the brand’s guerilla, one-on-one retention
tactics. VitaminWater’s first mover advantage, though, will not last forever, especially as replicas
of the product surge onto the market. VitaminWater will need to try innovative CRM methods
that incorporate a “fun” and viral factor in order to maintain consistency with the image that the
brand has already worked to build. Therefore, in order to maintain a strong level of loyalty and
retention, and to grow to take the number one spot (or at least hold its current position) in the
Customer Loyalty Engagement Index, the following actions are recommended:

● Collect e-mail address from customers and “fans” on the Vitamin Water website in order to
communicate with them, and to build relationships. Utilize/promote the “Customer of the Day”
23
concept in order to garner these acquisitions. Turn this into a “club” of sorts, with prizes,
interactive games, consumer generated content, etc. A birthday e-mail program should also be
incorporated to let customers know that they are important. At the same time, Glaceau will be
gathering data about its customers in order to re-message to them in a more personal manner.
This one-on-one like communication is what will keep consumers coming back to the brand.

● Utilize promotions, such as an “under the cap” game to build excitement around the brand, to
build loyalty and to drive the consumer to other brand outlets.

● Offer a VitaminWater rewards card (the user can select their “flavor” of card) where customers
can log on to the VitaminWater website after purchasing a VitaminWater product. They can then
enter a code into their member page on the site to earn points, which can be redeemed for prizes
and product. Further, each time the consumer uses the card, they will see the VitaminWater
branding.

● Publish promotional recipe books, where each recipe would have at least one flavor of Vitamin
Water as an ingredient. A VitaminBar (i.e. VitaminWater Energy Cosmo) version will be directed
to the college-age/young adult crowd, while a version for the younger and older demographics
will be slightly tamer (i.e. VitaminWater Clarity Sorbet Punch). These books will also
incorporate fun quotes, stories to go along with the drinks, and a rainbow of ironic images. A
child’s favorite treat may come out of one of these books (hopefully the non-alcoholic version!),
thereby introducing him/her to the brand at an early age. Consumers would also be able to
register online to receive the VitaminWater recipe of the week. The more touch points a
consumer has with the brand, the more likely he/she will stay loyal.

Marketing Mix
What is the name of this triangle?

24
Marketing Mix: Product
Description of Product:

VitaminWater is credited with creating the enhanced water category. The water itself is
de-ionized and distilled, and contains herbal extracts, vitamins and minerals, a differentiating
factor that has given it its “healthy” image. VitaminWater also contains a level of corn syrup
fructose that is similar to that in other sweetened soft drinks. Bright colors and a variety of
flavors, each with its own unique purpose (i.e. energy, clarity, increased metabolism, etc.), offer
distinction from regular water and sports drink beverages.
Aside from the drink itself, VitaminWater is also known for its distinctive bottle shape
and color-blocked label. Lined up on a supermarket or convenient store shelf, the assortment
resembles a can’t-be-missed rainbow. Humorous copy, in all lower case type, is used on the
labels in order to correspond to the brand’s quirky and youthful image. For example, copy from
the Power-C label reads:
"Legally, we are prohibited from making exaggerated claims about the potency
of the nutrients in this bottle. Therefore, legally we wouldn't tell you that after

25
 drinking this, Eugene from Kansas started using horseshoes as a thigh master or
that this drink gave Agnes from Delaware enough strength to bench-press llamas."

The variety of flavors appeals to VitaminWater’s core generation X and Y target market,
as well as to its peripheral market of soccer moms and younger, highly influenced kids. The
product’s bright coloring and quirky labeling mirrors the imagery and verbiage that today’s MTV
and MySpace generations are familiar with and interact with on a daily basis. Plus, the vitamins
and other health benefits are attractive to this same group, while also extending to older, health-
conscious individuals.
VitaminWater Flavors Include:

● Power-C: Dragonfruit (Vitamin C + Taurine) (Shaq's water--32 0z)

● Energy: Tropical Citrus (Vitamin B + Guarana) {Carrie Underwood's water}
● Revive: Fruit Punch (Vitamin B + Potassium)
● Multi-V: Lemonade (“Vitamin A to Zinc”)
● Focus: Kiwifruit-Strawberry (Vitamin A + Lutein) {Kelly Clarkson's water}
● Essential: Orange-Orange (Vitamin C + Calcium)
● Formula 50: Grape (50% Daily Dose of Vitamins) {50 Cent's water}
● Defense: Raspberry-Apple (Vitamin C + Zinc)
● Rescue: Green Tea (Vitamin C + EGCG)
● Endurance: Peach-Mango (Vitamin E + Ribose)
● Vital-T: Lemon Tea (Vitamin C + Vitamin E)
● Balance: Cran-Grapefruit (Vitamin C + Glucosamine)
● B-Relaxed: Jackfruit-Guava (Vitamin B + Theanine)
● Charge: Lemon-Lime (Vitamin B + Electrolytes)
● XXX - Acai-Blueberry-Pomegranate (Triple Antioxidants) {Sex & the City
Movie}

Product – Analysis and Conclusions:

● As vitamin supplements are attractive to the health-conscious, VitaminWater is using its name
and its vitamin ingredients to present itself as a health-conscious drink, even though its sugar
content is no less than that in a regular Coca Cola or other soft drink. There is an inconsistency

26
here in terms of what the product stands for in the consumers’ mind, and what the product
actually is. Customers may not have yet caught on to this discrepancy in a widespread manner,
although once they do, drop-off (at least amongst the health-conscious demographic) will likely
become an issue. At this point, Vitamin Water would need to decide how to re-position itself so
that its brand image and name are more inline with its actual product contents.

● While the copy on the product labels are meant to be fun and quirky, the labels themselves,
while distinguishable, do not correspond to this lightheartedness. The simple color-blocking and
black print (no images) are graphically dry in comparison to the overall brand image.

● The majority of Vitamin Water’s consumers are young, and therefore fickle with short attention
spans. Currently, the consumer experiences minimal interaction with the product, as there is only
one type of product available: a sugary beverage. With the strong branding that VitaminWater
has built, there is likely a larger potential for brand fans to incorporate other VitaminWater
products into their lifestyles. Such an extension has not yet been explored.

Product Recommendations:
To take advantage of the lifestyle branding potential, and to reach consumers in many
aspects of their lives, VitaminWater should consider offering extensions (in order to develop a
family of related products) to its original enhanced beverage line. Packaging and copy styles
would be consistent with that of the current product. The ultimate goal is to create a lifestyle
brand that consumers can relate to with a “this brand is for someone like me” statement. For
example:

1. Limited Edition Flavors: to add buzz and immediacy to the brand and product.
Constant newness keeps current customers on the lookout for the next flavor.

2. A zero calorie line, including one flavorless/colorless version (VitaminWaterPure): to

address the health-conscious consumer who may be turned off by the sugar content in
the current product. Additionally, this will help combat the new zero calorie
competitors that are coming onto the market. This, as well as the concept above (#1)
are recommended as the first efforts in terms of product extension.

3. Two liter versions: to compete with the carbonated soft drinks, and to encourage mass
and family-style consumption. Some of these two-liter offerings, will be offered in
carbonated versions.
27
 3. Breakfast and healthy snack bars (VitaminBars): To re-enforce the healthy lifestyle
image VitaminWater initially created, as well as to fulfill a need of the typical health-
conscious VitaminWater consumer: healthy snack bars. Most likely these consumer
are already purchasing bars, although if they are already loyal to the brand, and
consider it to reflect their lifestyles, a Vitamin brand bar will make logical sense to
them.

5. VitaminMints & VitaminGum: Same fruit flavors as the most popular waters, and
enhanced with vitamins. These types of items are carried around in pockets and
purses, and are offered to friends, therefore producing a viral branding element, as well
as another product to enhance VitaminWater as a lifestyle brand.

6.VitaminWater Popsicles and lollipops (VitaminPops): A way to attract kids to the brand
early on, as well as to lure parents by offering a fun way to deliver daily vitamins.

Marketing Mix: Promotion

Promotion Description:
Initially, Glaceau focused on grassroots endeavors to promote the Vitamin Water brand.
Glaceau purposefully avoided mass media outlets, as it wanted to first grow the brand
organically as a fashionable and healthy product, and relied on tongue-in-cheek marketing and
celebrity “spottings” to attract and influence young consumers. Celebrities like Allen Iverson,
and Paris Hilton were photographed with VitaminWater in hand. The majority of VitaminWater’s
promotional efforts, though, were initially centered around several hundred brand and school
campus advocates who worked to generate awareness and word-of-mouth buzz via product
sampling in retail and college locations. The retail sample program was titled “hydrology,” while
the college program was the titled the “campus ambassador” program. Along with the sampling,
these advocates also displayed banners, posters, information brochures, t-shirts and other such
promotional materials for both display and consumer hand-outs.
Such organic promotional tactics were utilized until 2004, when the company began
national marketing campaigns, starting with event sponsorships (action sports, music, fashion
and community-based events to build a hipster, “in the know” vibe around the brand), billboard,
web, and print, and more recently, television. The messaging of these promotions mirrors the
tongue-in-cheek humor that is printed on the VitaminWater product labels. The brand slogan,
“Hydrate Responsibly”, is included in promotional display, and is also meant to correspond with
VitaminWater’s sarcastic and cool brand image.

28
 By 2006, celebrity endorsements are also heavily utilized. Further, several celebrities
have been given their own VitaminWater flavors. This celebrity-factor has grown substantially
since Coca-Cola took over. Similarly, product placements in movies is now common practice.
VitaminWater has been strategically placed in both male and female targeted, humor-
based movies, such as Dodgeball and Sex and the City. Most recently, in order to continue
increasing awareness and word-of-mouth marketing among the Generation Y consumer,
VitaminWater has begun exploring mobile media and sms messaging as a promotional tool.

Vitamin Water Celebrity and Athlete Endorsers (sample list):

● Carrie Underwood
● Kelly Clarkson
● Jon Walker
● David Lee
● Josh Howard
● Tony Parker
● Shaquille O’Neal
● Lebron James
● David Ortiz
● Tom Brady

Promotion – Analysis and Conclusions:

● As the brand grows, grassroots efforts will likely give way to more mass forms of advertising
in order to maintain market share. VitaminWater will need to decide how to utilize other forms of
marketing, while still maintaining its humorous, lighthearted image.

● VitaminWater’s television ads are the brand’s most mass-promotional initiative to date.
Therefore, may of those seeing these advertisements have likely not been exposed to prior
marketing efforts, and therefore may be unclear as to what the product is all about. These
advertisements do not explain what the product is about, and feature athletes in some and
musicians in others. There may confusion about who VitaminWater is for, what it does, etc.

● VitaminWater’s latest mobile marketing efforts will involve couponing. While mobile
marketing is a great way to reach the target Generation Y audience, the coupon portion will allow
consumers to pay less for the product, which may devalue the premium positioning that
VitaminWater has been working to achieve.

29
Promotion Recommendations:

VitaminWater has tested numerous promotional vehicles, and has recently begun moving
into the more mass marketing arenas. While its promotional tactics have been successful, the
brand must consider its next moves, as well as which mediums to continue promoting through,
and which ones (if any) to drop. Some recommendations for the brand are as follows:

● As VitaminWater’s new venture into television ads are generating consumer buzz, and are able
to tell engaging brand “stories,” they generate word-of-mouth marketing, position the brand as
more of a major player in the beverage market, and keep the brand top-of-mind among today’s
television-loving consumers. Therefore, it is recommended to continue its promotional efforts in
this medium. VitaminWater will enjoy greater brand awareness, and potentially, a greater market
share of the bottled water market.

● To continue reaching Generation Y consumers in a relevant manner, VitaminWater will need to

consider which celebrity endorsements to go after next. In order to capitalize on the popularity of
reality television, VitaminWater may consider The Hills star, Lauren Conrad, Keeping Up with
the Kardashians star, Kim Kardashian, or media icon, Ryan Seacrest as potential candidates for
generating buzz among the Generation Y consumer. Product placements within these shows will
also gain additional visibility among the target market, and seem less staged than such
placements in movies.

● Now that VitaminWater has been able to capture consumers through its previous promotional
endeavors, a focus on building loyalty is critical in order to keep theses customers (see loyalty
and retention section for recommendations).

● The brand’s promotions are catchy, and therefore draw attention and curiosity, although there is
nowhere else for customers to go to find out more. Advertisements should include drive-to-site
messaging so that customers can learn more and interact with the brand. The more a potential
customer is able to engage with the brand, the more likely he/she will try the product.

● Event marketing, with its cool-factor, will continue to be key to reaching trendsetters and
influencers. While the brand should continue promoting itself at sports, fashion and music
events, it should also consider promoting itself at popular clubs in major metropolitan areas.
Only those “in the know” go (and are then let in) to these hotspots. Plus, if VitaminWater is
offered here, it must be cool. Also, have advocates educate bartenders on appropriate drinks that
could include VitaminWater. The VitaminWater Cosmo may be the new “it” drink, will
encourage experimentation, and generate buzz.

● The brand’s print ads tend to be more focused on product, and less humorous or entertaining
than its other promotional vehicles. VitaminWater should test incorporating its iconic humor to
more of its print presence. For example, incorporate scent strips (as is done with fragrances) in
print advertising. This will add some tongue-in-cheek humor that the brand is known for, and
will also have consumers smelling, and possibly craving the drink all day.

30
● If VitaminWater moves into line extensions, it will need to market these individually, while
tying them back to the initial product and umbrella brand image. For example, the zero calorie
beverage’s slogan may be: “fresh squeezed water.” This campaign would be colorful, visual, and
tongue-in-cheek to fit in with previous VitaminWater campaigns. A key celebrity endorser would
also be used.

Promotion Examples:

An Early Promotion Placement Movie Product Placement: Sex & the City

31
 Carrie Underwood Outdoor Placement Mobile Outdoor Placement (sports-theme)

In-Store POP “Celebrity Spotting” (Lindsay Lohan) Kobe Bryant Placement

Branded Promotion Limited Edition VitaminWater Air Force Ones

(to capture the sneaker-head market)
Marketing Mix: Place

VitaminWater is located in a variety of business channels. It is located within supermarkets, drug

stores, convenience stores, select food service locations and on the internet. 22 During 2005-07,
Supermarkets accounted for nine in ten functional beverage FDM sales. Drug stores make up
5% of the Functional beverage sales. In 2002-07, sales through mass merchandisers (other than
Wal-Mart) experienced a 116% gain. Sales in through mass merchandisers are considerably less
than in the grocery channel, although current increases indicate much potential.23 Below is a
chart of the retail distribution of Functional Beverages.

22
Vitamin water slide
23
Mintel Reports:Functional Beverages - US - August 2007

32
 Functional Beverages - US - August 2007 - Retail Distribution

Figure 43: FDM *sales of functional beverages, by channel, 2005 and 2007
Change 2005-
2005 2007 (est.) 07
$million % $million % %

Supermarkets 7,846 92.7 8,856 90.4 12.9

Drug stores 370 4.4 488 5 31.7
Mass merchandisers 248 2.9 451 4.6 81.9

Total 8,464 100 9,795 100 15.7

* Excludes sales through Wal-Mart

Source: Mintel/Based on Information Resources Incorporated, Inc. InfoScan® Reviews Information

24

Going forward, one of the places VitaminWater needs to be placed is in amusement parks. This
will be able to give them more market share as well as introduce the product as a healthy
alternative in a place where soda is usually served. VitaminWater can also be introduced at bars.
It can replace Red Bull and other energy drinks and be used as a mixer with vodka. Restaurants
are another place where VitaminWater can make a lot of profit and market share. Once brand
awareness sets in, people will be happy to hear that their favorite restaurant is carrying the brand
they enjoy.

Marketing Mix: Price

The VitaminWater 20oz average unit price range from $1.20 to $1.50 in the grocery stores and
the price for 32oz range from $1.90 to $2.20. The price of VitaminWater needs to stay relatively
the same going forward. People tend to think of a product as lower quality when it is priced
significantly lower than its competitors, so VitaminWater will be kept at a constant, but
competitive price with slight increases due to the inflation rate. There will not be any coupons
for the products since this will cheapen the product and lower the quality of it.

24
Mintel Reports:Functional Beverages - US - August 2007

33
i
ttp://investing.businessweek.com/businessweek/research/stocks/private/snapshot.asp?privcapId=4399679
ii
www.glacéau.com.
iii
www.bevnet.com/news/2008/6-24-2008-pecoriello_enhanced_water.asp

References

Promoting at Spring Break:

http://promomagazine.com/sampling/news/vitamin_water_samples_spring_break_030507/

Facebook
http://www.adweek.com/aw/content_display/news/digital/e3i70fa56666e6c5bccbcd1f8c0690137af?pn=
4

First marketing Campaign:

http://www.bevnet.com/news/2004/07-06-2004-energy_brands_glaceau_marketing.asp

Customer Loyalty Measure

http://www.brandkeys.com/awards/

Customer Loyalty: Customer of the Day (video):

http://technorati.com/videos/youtube.com%2Fwatch%3Fv%3D4S48NN2-KHI