MAJOR PLAYERS, MARKET LEADERSAND HOW THEY SEGEMENT THEIR MARKETS
The Irish bottled water market is a relatively new and untapped market. It wasn't until 1984 that the market for bottled waters within Ireland really took off. Up to 1984 imported waters were completely dominant. It was at this time that Ballygowan took the brave move to produce bottled waters here in Ireland. Their success has led to an influx of Irish producers into the market to the detriment of the imported waters such as Perrier which has seen its market share dwindle dramatically. The development and aggressive marketing of domestic brands has been the reason for this change around. The market however has four leading players, Ballygowan, Tipperary, Kerry and River Rock who command over 80% of the market. (Note: C& C bought Ballygowan in 1992 M&J Gleeson own Tipperary Water) (source: Canadean)
The industry has quickly come along way from nothing because water available to consumers is not as good as it was. Additional factors such as people encountering mineral water abroad and a fashion element fuelled its emergence since the mid 1980's. Ballygowan are undoubtedly the market leader within Ireland. In 1996 total consumption of packaged water was 32.2 million litres, of which Ballygowan had sales of 15.5 million litres. That constituted 48.1% of the market. Tipperary has a 15.5% market share followed by River Rock at 9.6% and Kerry Spring at 9.0%. [source : Trade Interviews; Canadean] The packaged water market is as yet underdeveloped and accounted for only 6% of all sales in soft drinks in 1996.
However in Ireland there is an increasing popularity of both natural and spring waters, with this being reflected in their increased availability at retail level. Initially bottled water was sold principally through hotels, restaurants and health food stores. However this situation has changed dramatically with the grocery sector now holding a 73% share with the licensed trade's share continues to slide.
1995 OUTLET SHARE Grocery/CTN 73% Licensed Trade 13% Dispense 14%
While Ballygowan still maintains its dominance in the packaged water their market share has been falling. This is due to new entrants into the market but also to the quality of the products offered by these new companies. Ballygowan are currently targeting total sales of more than 40 million litres valued at more than £35 million per annum by the year 2000. Ballygowan exports to Northern Ireland, Britain, France Germany Italy and Cyprus with these sales accounting for 40% of total sales. Ballygowan has recently been confirmed as the number one brand of bottled water in the UK pub trade.
Tipperary Water was the second major Irish firm to enter the market in 1986 and since then has expanded significantly. Tipperary water has 16 export markets with a turnover of £50 million. Deep River Rock is a very brand orientated product and has spent over £1/2 million on consumer advertising since its conception. This has given it a reasonable share of the market for the age of the company. Its investment in image is coupled with its association to the Coca-Cola brand name allowing consumers to instantly associate it with a quality product.
The market for packaged water is divided up into two main sections, still water and sparkling water. Initially sparkling water was the more popular product. Its market share however has continuously been eroded into over the previous few years to the point in 1996 when still water outsold sparkling water. The reason for this move to stilled water reflects a maturing market.
Million Litres Volume 1992 1993 1994 1995 1996 STILL 6.6 9.1 10.6 15.9 16.9 SPARKLING 13.3 16.1 16.0 17.4 15.3
With the great opportunities available within an ever expanding bottled water market, (with an annual growth rate of 20%), the market has seen many new entrants over the past few years. Many commentators sense that many of the companies see the potential within the market and are just out to make a quick profit. This they believe is to the detriment of the market as if consumers are inundated with poor quality waters the industry as a whole would be effected. Following our analysis of the major players, market leaders and how they segment the market, Cape Clear Water believe the opportunities for a new quality water on the Irish market are great.
Promotion Issues
There is a lot more to selling goods than just putting them on the shelf, companies have to display the benefits of the goods to the potential consumer, they must get inside the consumer's minds. To do these companies use the mass-production tools of advertising, sales promotion and public relations. However in Ireland bottled water companies have not developed into mass advertising organisations (especially when compared to the advertising campaigns of the beer companies such as Guinness who invest £6.87m per annum on advertising and Murphy's who spend £3.32m).
In the Republic of Ireland bottled water advertising expenditure per annum is fractional when compared with soft drinks advertising. In 1992 total annual soft drinks advertising expenditure amounted to £3,844,100- compared to annual bottled water expenditure of £100,300 or 2.6% of soft drinks advertising expenditure. In 1992 the bottle water market in Ireland was at a primitive stage and mass advertising was not on the agenda. In 1992 Tipperary were the leaders in advertising expenditure accounting for 54.3% of the market share in advertising. However from 1992 to 1994 there was a steady climb in total expenditure on advertising and it peaked in 1994 at £795,100, with new leaders Ballygowan accounting for a massive 60.7% of the advertising market share.
This dominant position was reflected in their sales where they controlled 49% of the market. From 1994 onwards, total advertising expenditure decreased to £551,500 in 1996, and Ballygowan managed to maintain its position as Ireland's top selling bottled water controlling 48.45% of the bottled water market. As we can see from the annual advertising expenditure, mass advertising is not part of the company's agenda. In a market that is growing 20% per annum company's to keep their market share. Presently Ballygowan are the most successful water company in the market and are consistent in maintaining their market share.
Almost all the bottled water companies adopt in-store promotions such as 33% extra free on a 2-litre bottle, or a twin pack at a reduced price to promote their own brand. These are the most popular promotion methods used by bottled water companies. Some companies take on bigger advertising operations such as the sponsorship of award ceremonies or tournaments, for example the Ballygowan Irish Sports Star awards held annually. Packaged water experiences its greatest sales during the summer and therefore bottled water companies are aware that advertising water as an all year round product is necessary if they are to increase their sales in off-peak months.
PRICING STRUCTURES
When considering price companies in the water industry need to consider other factors such as competitors prices, costs and how much of the price has to go to the a) retailer b) bottlers c) government. They also have to consider their target market.
DISTRIBUTION
Distribution determines how well target customers gain access to the firm's product or service. Companies need to pay particular attention to their distribution channels. Management must design its channels carefully with an eye on tomorrow's likely selling environment as well as today's. In the analysis of the distribution systems we found that it would beneficial to examine one particular company's distribution system, i.e. Tipperary's. M & J Gleeson who own Tipperary water are wholesale distributors to the licensed trade. Tipperary Water is as a result the largest independent distributor to the licensed trade. Tipperary increased their distribution network as the company expanded. In 1991 it opened a distribution depot in Drogheda to serve the northeast market including Dublin. The opening of another depot in Belfast to serve the Northern Irish market in 1994 followed this. As the company expanded further a depot in Cavan was opened in 1996 to serve the northwest of the country. Tipperary Water has also been very successful abroad and exports its products to 17 countries worldwide.
INTRODUCTION TO MY MARKETING STRATEGY
Based on the location of our spring we decided to call our product Cape Clear Natural Mineral Water. Our water has the same qualities and attributes as the other waters on the market but the sheer isolation and cleanliness of our source offers the consumer a refreshing alternate. Our research has shown that people welcome this new product on an already crowded water. We consider that we can compete successfully with existing brands by marketing more enthusiastically and taking a fresh and innovative approach to advertising and promotion. Thus we feel there is a market opportunity for such a product if properly pursued. Marketing is the force of your enterprise that begins and with customers that have to be satisfied in a competitive market.
Marketing like any other business function cannot be implemented without thought and structure. We must ensue that the marketing strategy we choose is consistent with the objectives of our enterprise, the resources we have at our disposal and the environment in which it must operate. Recognising consumer needs and a possible niche in the market, from our primary and secondary research, we set about developing our marketing strategy. To be effective in the 21st century, a marketer must continually re-evaluate the concept of rightness to ensure that the marketing mix is sensitive to a continuously and rapidly changing marketplace.
"At the end of the day, reaching a clearly defined target audience is a vital consideration in the brands promotion and positioning." - Carl Keen - Sheridan Marketing Team.
We propose to clearly identify Cape Clear Water's target market and also address issues such as product positioning, together with developing our marketing mix (the precise balance between the four factors that make up any product operation i.e. product, price, place, promotion). While we will treat these components separately, they do in fact combine to create the overall marketing image of both the product and the enterprise. When we decide to produce our natural mineral water, its quality must be reflected in the price, the way in which the products are promoted, where the products are on sale and in what quantities. To a large extent, the marketing success of an enterprise depends on how familiar it is with these marketing variables and the amount of the resources it can denote to its development.
The key to Cape Clear Water's successful development will be defined by the development of a cohesive marketing plan covering these areas individually and collectively, so that their combined efforts will satisfy our customers needs i.e. the product image will be consistent with that desired by the consumer.
Secondary Research
Secondary research involves the analysis of current trends in the market place. Prior to entry into the water industry analysis must be done on both the internal and external market. In order to do this information was attained from the following sources: · Bottled Water Association of Ireland · An Bord Bia · Ballygowan Water · Tipperary Water · Trade and Business Journals · An Bord Trachtala · Cork City Library · The Irish Times · Evian Water
The aim of our secondary research is to assess our possible market for Cape Clear Water and also to identify the opportunities and threats to the company. We also what to explore the strengths and weaknesses of the bottled water industry. Through the sources mentioned we also wish to learn what the people in the industry perceive as being important and unimportant in the market. The newspaper articles and trade journals also went a long way to towards identifying market opportunities within the water industry. We found a very informative article in a 'Licensing World' trade magazine, which gave the results of a survey, carried out in 1995 as to the reasons that people purchased bottled water. This information is obviously invaluable to Cape Clear Natural Mineral Water. ¨
The 54% who considered bottled water a refreshing alternative to alcohol and the 8% who feared the drink driving laws are being targeted by Cape Clear in bars, restaurants and clubs such as golf clubs. Still, sparkling and flavoured waters will be distributed to these places in 250ml glass bottles. ¨ The 11% who bought it for diet or health reasons will be targeted in supermarkets, convenience stores, health shops and leisure centres. ¨ The 24% who are worried about tap water can avail of our 19 and 11 litre containers.
Primary Research
Consumer Questionnaire
First and foremost in order to establish a type of market we should target, we: ¨ Categorised our respondents in terms of gender, age, marital status, and occupation of head of household and size of household. ¨ We then asked whether they drank bottled water and what brands they consumed. ¨ Along this theme, we discovered the frequency of water consumption, average weekly expenditure on water, and where the respondents normally drink water. ¨ We then asked whether the respondent drank flavoured, sparkling or still water. ¨ We also asked if the respondent would try Cape Clear Water, when they would consume it and how much they would pay. ¨ We then examined the attributes the respondents thought to be of the most important in evaluating a product such as Cape Clear. ¨
Finally we examined the ages, gender, and other factors with regard to those who said they would try the product, in order to identify a target market. The following are the results of this questionnaire: Sex: 58.3% Female Occupation of head of household: - 41.7% Male 42.1% Professional 17.7% Skilled Age: 18.2% Under 20 3.7% Unskilled 55.2% 21-35 18.9% Farmer 13.9% 36-50 1.8% Unemployed 12.7% Over 50 3.0% Pensioner 11.0% Student Marital Status: 1.8% Other 71.9% Single 28.1% Married Occupation:
Size of household: 19.5% Professional 21.0% 1-3 Members 13.4% Skilled 58.6% 4-6 Members 7.3% Unskilled 20.4% Over 6 Members 3% Farmers 51.2% Students 4.3% Other Does the respondent drink bottled water? 73.5% Yes 26.5% No Type of water drank: 38.7% Sparkling 44.3% Still 17%
Flavoured Average weekly expenditure on water: 12% <£2 32.5% £2-£5 45.7% £5-£10 9.8% >£10
Frequency of water consumption per week: 10.1% Never/rarely 60.1% 1-3 times 3.8% 4-6 times 22.8% 7-10 times 3.2%
More than 10 times Those who drank other brands: 28.5% Ballygowan 22.5% Evian 18.3% Kerry Spring 15.7% River Rock 9.7% Tipperary 5.3% Other
Would Cape Clear appeal to respondent? 89.7% Yes 10.3% No Attributes receiving No.1 rankings: 62% Taste 26% Quality 5% Price Shelf life, texture, versatility, packaging and appearance received only 7% of No. 1's between them.
Why does respondent drink bottled water: 58.3% Health 38.3% Drink driving 3.4% Other
We then examined whether there was any relationship between particular categories of customers and their decision to try Cape Clear Water. We checked for statistical significance in the areas of sex, age, whether they drank water. The only area where statistical significance was discovered was in the sex of the respondents saying they would try Cape Clear Water. 76.4% said they would try our water, out of 68 males and 93 females. This implies that in the absence of any factors affecting them, 52 men and 71 women should have been the figures emerging as saying they would try our product.
However in actual fact, only 40 men said they would and 83 of the women. In contrast to this is the age of respondent's correspondence to whether they would try Cape Clear Water. At first glance it appears that the 21 to 35 age group were the most enthusiastic about it. However when the high number of 21 to 35 aged respondents answering the questionnaire are taken in to account, there is no significant difference. 76.4% of respondents said they would try our product.
This means that out of the different age categories, the expected and the observed numbers were: Expected Observed Under 20 22.2% 21% 21-35 67.2% 69% 36-50 17.6% 17% Over 50 16% 16% Observed results were very much in line with the expected results, that is 76.4% of each category. This clearly shows there is no significance between age of respondents and whether they would try Cape Clear Water. Retail Questionnaire The aim of the retail questionnaire was to gauge the reaction of retailers to a product such as 'Cape Clear'. Many of the retailers surveyed have been in the supermarket/catering business for many years and we felt that at this stage they are experts on their customer demand and habits. ¨
We established the type of retail outlet we were dealing with and the position the respondent held in the business. We ascertained what age groups their customers fit into. ¨ We then went on to examine the trends in still, sparkling and flavoured waters. We asked whether sales of these had increased or decreased in the last 5 years. ¨ We queried as to the ideal bottle size from a retailers point of view. ¨ Following this we got down to business and asked what price the retailers would charge per bottle. The importance such as factors such as product quality, packaging and presentation, promotion and prompt delivery was then ascertained. ¨
Finally we gauged the interest among retailers, both in sampling our product and in staging an in-store promotion. The following are the results of this questionnaire: Types of Retail Outlet: Multiple 10% Shop 52% Public House 9% Hotel 10% Other 19% Position of Respondents: Proprietor 38% Manager 24% As. Manger 5% Shop Ass. 24% Bar Attendant 4% Age of Customers: 21 - 35 28% 35 - 50 19% Mixed 43% Have Bottled Water Sales Increased: Yes 99% No 1% Sales of Water Accounted for by: Still 42% Sparkling 38% Flavoured 20% Did retailers think Cape Clear would be successful? Yes 71% No 29% Would the retailer stock Cape Clear? Yes 81% No 19% Anticipated Major competitors: Answers varied between Ballygowan, Tipperary, Irish Spring, Kerry Spring and River Rock. Interested in in-store promotion: Yes 80% No 20% Important Factors: Product is of prime importance. Ms. Healy, Bandon also said, "attractive packaging is needed to represent the ideal image of a cool enjoyable drink to the consumer".
PRODUCT CAPE CLEAR,
Ireland's southernmost inhabited island, 3 miles long by 1 mile wide, lies 8 miles off the coast of West Cork. 3 miles west of the island stands the solitary Fastnet Rock. To the northwest stretches the Mizen Head, the mainland's southerly point. Cape's wild romantic scenery, its sparkling harbours, its cliffs and bogs and lake, all contribute to the island's unspoilt charm. Heather, gorse and wild flowers cover the rugged hills. Myriad stonewalls have a patchwork effect on the varied landscape. Megalithic standing stones and a 5000 year-old passage grave, a 12th century church ruin, a 14th century O'Driscoll castle, cannonaded in the early 1600's, suggest times past. Saint Ciarán, the island's patron saint, is allegedly the earliest of Ireland's four pre-Patrician saints. Cape's remote island location, coupled with its proximity to the continental shelf, makes it the foremost centre for birdwatching in Ireland. Whale, leatherback turtle, sun fish and shark are spotted every year, dolphins regularly.
PRODUCT ATTRIBUTES
From this remote and beautiful setting comes water from one of Ireland's most pure and forgotten springs. The water is abstracted direct from a deep source on the highest part of the island. Cape Clear Natural Mineral Water is sourced where the water emerges from a tunnel in the mountain at 52.88 degrees F. The source's aquifer is estimated to be at 600 feet through the earth's surface, where the water filters through levels of shale, Blakely sandstone and limestone. At the source the water has a distinct iron taste which is removed by micron filtration and ozonation. Cape Clear is a sweet tasting and well-proportioned water. The low mineralisation, with an emphasis on calcium, makes it an ideal table water for daily consumption. · Cape Clear is a natural mineral water as distinct from the many bottled spring waters available on the market. · Natural Mineral water is a strictly regulated product which comes from a protected underground source and must emerge from tat source totally free from all pollution and harmful bacteria. It must be bottled at the source. Mineral water cannot be treated, but carbon dioxide can be added for sparkle. It must have a consistent mineral content. The product and the source must pass stringent EU controlled tests before being recognised as a natural mineral water. · Spring Water does not have to be bottled at the source and can be treated.
It must meet EU tap water regulations. Spring water can come from a wide variety of sources, whereas Cape Clear Natural Mineral Water can only be sourced from its natural location. · High calcium, magnesium and bicarbonate concentrations mean that Cape Clear water is hard. · The typical composition of Cape Clear Natural Mineral Water is: Mg/lt. Calcium 114 Magnesium 16 Sodium 15 Potassium 3 Bicarbonate 400 Chloride 28 Sulphate 15
PRODUCT RANGE
· Cape Clear is committed to product innovation and satisfying its many customers. · Cape Clear intends on launching a series of light water products within two years of production to capitalise on the ever-growing health and diet conscious consumer. · Cape Clear are also introducing a range of mixers which will primarily be targeted at restaurants, clubs and societies. These mixers will be available in 80ml glass bottles. · Cape Clear products are available in a range of packaging types and sizes: · Glass: 250ml, 1L, 80ml mixer. · Can: 150ml, 330ml · Plastic (PET):500ml, 1.5L, 2L, 750ml Sports Cap. · Plastic: 11L, 19L · The product range includes: v Cape Clear Sparkling v Cape Clear still
THE EMPHASIS ON QUALITY · The essence of the success of the Cape Clear product range is that it is a pure, natural mineral water, sourced from one of the finest natural locations in the world. · The highest standards of quality are maintained in the handling of such an important natural product. · The geographical location of the Cape Clear source in the south west corner of the country is an important factor. The strong prevailing winds from the Atlantic ensure that the area is free of pollution. High rainfall also plays an important role. · The catchment area is totally free of industry and intensive farming. · Cape Clear is one of the few companies in Ireland to employ a full time hydrogeologist. · Cape Clear has been rewarded with the very high standard of EU natural mineral water status in recognition of the naturalness and purity of the product, its natural source and the geological aspects of the site from which it originates. Along with Ballygowan Ltd. ,which is now an established company in the bottled water market, Cape Clear aims to achieve ISO 9002 accredation. In addition the company's products will be licensed by the National Standards Authority of Ireland to use the Irish Standards mark indicating conformity to Irish Standard IS 432: 1992, the Irish Bottled Water Standard.
HEALTH BENEFITS OF CAPE CLEAR WATER · Today's lifestyle trends have led to the increasing demand for natural products. Peoples' concerns about personal health, general fitness, the environment, tap water quality and drink driving have positive implications for the bottled water market. · Water plays an important role in a healthy diet. It is essential to drink plenty of fluids to stay healthy. · Water is also an important agent in providing the necessary calcium needed to strengthen bones and teeth for the general well being of the nervous system. · By flushing out harmful toxins, water promotes a clear, healthy complexion. · Boiling tap water does not remove all the chemical impurities of water. By using natural mineral water one can rely on the natural purity of the product. · One litre of Cape Clear Natural Mineral Water supplies 23% of the recommended adult daily calcium intake. · Cape Clear Water is also suitable for those on a low sodium diet.
Product Life Cycle
Product life cycle is the successive stages through which a product moves, between its initial launching and its final removal from the market. If a product is successful it will have a life cycle from introduction, to growth, through maturity and finally into decline. The key to the success of any new product is the identification of innovators; they are a relatively small part of the total potential market - usually 2-3%. Yet the remainder of the target group will not buy unless this group buys first and are satisfied with their purchase. These people prefer magazine articles and recommendations for the influences, so it is difficult to find them. Ballygowan have been on the market since 1984 and is extremely popular but is still growing. Tipperary was a close follower of Ballygowan's example but they have not been as successful and had to drop their prices to compete against Ballygowan. Cape Clear is at the introductory stages of its life cycle, where its purpose will be to establish a market, using extensive and vibrant promotional activities. Positioning: Cape Clear is positioned as a completely natural mineral water of premium status.
TARGET MARKET
With so many stories of pollution of rivers and the public water supplies and also water shortages, people are more and more likely to move over to the safer option of bottled water. There have been many reports of mothers with young babies who will only use still bottled water when making feeds. We realise that once we gain the trust of our customers that a bond will emerge which will force people away from drinking tap water. There is also an increased focus on healthy lifestyles. Women in particular respond to health messages such as "you should drink eight glasses of water a day ". People engaging in sporting activities recognise the need for rehydration and there is even a water cooler in many workplaces and leisure centres now. This is the market where our 19 litre water coolers, 1.5ml, 2 litre and 750ml sports pack bottle can be aimed at. A third market that we will be looking to exploit is the 15-25 year old age market.
Due to Ireland's "Europeanisation" and increase in "brand drinking", consuming bottled water in social settings is seen as a fashion statement. With this age group travelling abroad more so than their forefathers, they consume bottled water abroad and brings these habits home with them. There is evidence that bottled water are drinks seen to be as trendy as soft drinks like Coca-Cola and Pepsi, especially in the hot, summer periods .We envisage that our 500ml and 750ml bottles would exploit this market.
The fourth market we see ourselves targeting is a completely new, experimental market. However we are confident that it will be a success. We are going to sell an 80 ml mixer bottle which almost as a luxury good to hotels, airlines, golf clubs, tennis clubs, restaurants and off-licenses. We would sell it as a healthy mixer for spirits such as whiskey, brandy, vodka and gin. The water would be still or sparkling and would be used in bars where the poor taste of tap water can stop people from buying whiskey. We would also envisage that that the publicans would stock our products to help their trade also .We would hope to sell this product as a complement good for people (especially the elderly) who drink nagons of whiskey at home and on train, bus and plane journeys .As this products a luxury good we would hope to make a large profit here from this product
PLACE DISTRIBUTION
Cape Clear Water limited has the most state of the art bottling facility in the country. It captures the essence of pristine bottled water sources and combines it with modern of bottling techniques. This newly built bottling factory was built with the beauty of the island in mind and uses the most environmentally friendly materials. The facility covers 2000 square feet and is built using an old stone finish so as to fit into the surrounding area. The bottles are then shipped by sea to a purpose built storage depot in Cobh. This depot serves as the main distribution centre for Cape Clear Water Ltd. This site also contains the headquarters of the company. Contained within are the marketing and product development departments. Cobh was chosen as the ideal place to set up as it is near Pepsi's Little Island plant. Cape Clear Water Ltd has negotiated a partnership with Pepsico Ireland Ltd to use the well-established distribution network that Pepsi has built up over its many years operating in the Irish market.
Cape Clear Natural Mineral Water will soon be as widespread as the Pepsi Brand. This partnership with Pepsi is a very exciting prospect for the company. Being such a young company the expertise and extensive network provided by Pepsi will be invaluable. Cobh's other major attractions are the rail link with the rest of the country and the seaport at Ringaskiddy. The port will allow Cape Clear Water Ltd easy access into the UK and European markets in the future.
Cape Clear Water Ltd will initially target supermarkets and smaller shops. Once established in these areas we hope to expand our distribution network into public houses, restaurants, nightclubs and various social clubs such as golf and tennis clubs. In the first six months we will use the Cork area as a test market. At the end of this period the company will evaluate the feedback received and if necessary refine the product accordingly.
Using the Pepsi network we hope to enter other markets such as Dublin, Waterford and Limerick as soon as possible after the test period with a view to countrywide distribution within two years. The company has agreed terms with numerous distribution companies that will initially distribute our product ranges. In line with our projected expansion other wholesalers will be used but initially Cape Clear Water will use the following wholesalers and distributors: Ø Ban Ard Cash and Carry, Kinsale Rd, Cork. Ø James A Barry & co. Ltd, Mallow Co. Cork Ø T&J Ashe, Dingle Co. Kerry Ø Kelly & Co. Ltd., Bashna Rd, Tipperary Ø J D O'Connor & Sons Ltd., Kanturk, Co. Cork Ø Sean Byrne & Sons Ltd,. Kilkenny
PROMOTION
Promotion is the most important P factor in terms of affecting media strategy and planning. A vital element in ensuing our product's success would be the ability of our promotion and advertising to arouse awareness among consumers. As Cape Clear is new product on the Irish market, our promotional aspect is made all the more difficult as we have to create a whole new awareness of our product. Also Cape Clear, not being the only water on the market, needs protection against the threat of more possible new entrants by differentiating itself so well that it will be impossible for would-be competitors to successfully launch rival products in the same market. We see a strong promotional campaign as a way of achieving this. The primary role of our promotional strategy is to encourage people to buy our product.
The key elements of our message gives A.I.D.A. (Awareness Interest Desire Action). With this in mind, we developed our strategy. What to communicate: The central part of our strategy is that we want the consumer to be attracted by what we say. Our promotion should convey Cape Clear as a premium product through the use of a black glass bottle which conjures up images of grandeur. Cape Clear gives a sense of comfort in the knowledge that the product is completely natural. We also want to stress that it is innovative, relatively original to the Irish market, and that it is a drink can be enjoyed.
With whom to communicate: Having carried out an extensively secondary research programme, who to communicate our message to was rather an easy task. A number of a groupings were identified. · Health conscious people · Sporty people · Drivers who can't drink but still want something refreshing in a pub. · People who are worried by the quality of tap water.
How to Communicate: The bottom line here when deciding how to communicate is which modes of advertising can most effectively reach our target market. Different media forms are used for different purposes. No one specific advertising channel can accomplish all objectives of a promotional plan and the use of several channels is therefore the best way of advertising. · In-store promotions These will play a vital role in launching Cape Clear. We feel in-store promotions are an effective means of evoking customer interest in the product. We will carry out these promotions at the launch of the product and will vigorously follow it up with continuous promotions in different supermarkets throughout Ireland, to establish effective consumer awareness. 80% of retailers said they would be interested in holding an in-store promotion.
· Radio We chose 96 and 103FM along RTE Radio Cork to air our advertisements. Its primary use is to highlight promotions. Its advantage is that it can reach a wide area. Its value is primarily of an attention grabber and it must be brief in order to be effective as listeners are unlikely to remember a long or involved message.
· Newspapers and Magazines National newspapers such as The Examiner are the newspapers in which Cape Clear will be advertised. The advantage of printed media is that, not alone does the primary reader read the advert but pass along readers will also read it e.g. at the hairdressers, doctors, aeroplanes etc. · Billboards These help the initial awareness of the product. · Television In our first year we will not use television advertising due to the cost, but we will use it once the product is established nationwide. · Introductory Scheme One of the insights gained from the retail questionnaires was that although retailers said they would stock Cape Clear, some were sceptical. For this reason we established a retail introductory scheme to run during 1999, which allowed 10% to the retailers to make it more attractive. We feel confident that at the end of 2000, this will no longer be required.
PACKAGING
Packaging serves many useful functions and is a necessary part of marketing. It is generally agreed that packaging is valuable to marketing in many ways. The package used for Cape Clear Water is a different bottle to many of the other bottled waters on the market. The label will be plastic and see through thus emphasising the clearness and cleanliness of the water. Packaging is the first thing a potential customer will see therefore, it has to be inviting. The original shape of our bottle will make it easily identifiable to consumers. We believe with our advertising strategy Cape Clear will become an established brand and a recognised label giving Cape Clear Water limited a distinctive edge nation-wide and eventually Europe-wide.
· Executive Summary
The Irish economy is currently experiencing the fastest rate of growth in the western economy. This environment makes it extremely attractive to companies wishing to enter the Irish market. The Irish market currently attributes much strength. The economy consisting of 3.6 million people has just fewer than 1 million people in the key soft drinks age bracket of 10-24 years. The buoyant Irish economy is also a strongly branded market. The soft drinks industry is highly concentrated with leading companies taking 75% of the total market. These companies also have strong distribution networks. The market however also contains a number of weaknesses. It is a small economy with poor infrastructure outside the major urban areas. A number of the smaller and more local suppliers are too small to survive greater international competition.
A number of threats exist within the market for a new company. The effects of the Tesco purchase of Quinnworth/Crazy Prices may lead to local supply being threatened by links to branded manufacturers. This is also the case with the increase in smaller foodmarkets coming under the control of Centra and Spar, for example, which provide their own-label goods. This being said the opportunities are still enormous. The increase in living standards brings with it a greater disposable income along with more leisure time. This being coupled with an upturn in the lucrative licensed trade channel, especially for beer, wines and spirits and carbonates. Adding a steady growth in tourism to this scenario leaves a very favourable picture of the Irish market.
Using SWOT analysis we came up with the following findings of the market for packaged water. The packaged water industry contains a very high quality of water. However the market, especially for still, is becoming generic. The high pricing in the on-trade market is impacting on volumes in this channel. It has also been found that "flavoured waters", technically carbonates, are confusing the consumer. However, the per capita of bottled water consumption are very low in European terms leaving huge opportunities for growth. This opportunity is also aided by the varied quality of domestic water.