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Consumer Perceptions on Energy Drinks

Our project is focused on developing a brand for a new kind of energy drink, one that is the complete antithesis of what the big players in this market (such as Red Bull, Monster etc) are perceived as.

These incumbents have spent years cultivating strong associations of their brand with a predominantly male, younger, fast living, work hard/play harder image.

These energy drinks have also developed a notorious association with being unhealthy.

Our idea, based around the unique nutritional properties of the African superfruit of the Baobab tree (”the tree of life”), is to create an alternative energy drink that is targeted at a more “responsible” (possibly older) health conscious consumer (of either gender) whose needs are not being addressed by existing energy drinks.

We made a number of assumptions here and as part of our branding assignment, we first wanted to understand whether our assumptions were correct. Is there really a wider market for energy drinks and if so, what are the pain points of consumers in that wider market that current players are not addressing? Does our product (a completely natural and nutritious alternative devoid of artificial chemicals typically associated with traditional energy drinks) truly offer value to this untapped consumer? If so, what are the day to day habits or rituals of these consumers, where this new kind of energy drink can become a part of their life?

In order to start answering some of these questions, we developed an extensive market research survey for which we employed the services of Amazon Mechanical Turk recruiting consumers between the ages of 30 and 50.

The early results are very interesting, confirming some of our assumptions and earlier qualitative research, while shedding new light on how to address this new market.

1. There is clearly a need within this demographic (not usually served by the traditional energy drinks makers)

2. This need is currently mostly being addressed with coffee (followed by traditional energy drinks).

3. Over 80% of respondents in this demographic consider traditional energy drinks to be either unhealthy or very unhealthy.

4. We also gathered some insights on the purchasing habits of this consumer base that can help inform our go-to-market strategy

As we move forward with our branding assignment, given the data we have gathered so far, we feel that we may be able to carve out a lonely place on the competitive frontier given the right branding strategy.

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The New Frontier of Branding

Reading the articles for Thursdays class, I couldn’t help but be reminded of how the Dollar Shave Club came out of no-where a few years back, bringing a fresh new take on providing a commoditized product, the humble razor and in a very short time created a multi-million dollar company in a saturated market.

The viral marketing of this low budget video led to 19 Million views during launch and culminated in a referral campaign that further helped accelerate the word of mouth network effects that resulted DSC’s commercial success. Had Dollar Shave Club tried to compete with the likes of Gillette etc on their own turf and advertised in traditional ways, they may not even have seen light of day on a store shelf.

As we consider a branding strategy for our start-up B-Energy, an all natural energy drink for the health conscious consumer, based uniquely on the superfruit of the Baobab tree, we are up against a similar highly competitive market. Where there are powerful incumbents and new energy drinks coming out almost every month, with some even claiming health benefits. How will we differentiate ourselves and carve out a share in this market? Knowing who our customer is, developing relationships with that customer, between such customers and making sure our values resonate with these consumers using networks and alternative business models will be central to our strategy.

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Intel in sight

The “Intel Inside” campaign directly targeting consumers came at just the right time, when the ability to build and customize your own desktop PC was becoming more and more accessible to the average consumer. The promise was that one could build a media powerhouse according to one’s own needs and specifications. However, close to the time of the publication of this case, the desktop PC market was already under decline, with cheaper and cheaper laptops flooding the market and computing becoming increasingly more mobile (and this was before the advent of the smartphones and tablets).

In hindsight, it seems that Intel should definitely have taken its “Intel Inside” campaign further to aggressively associate the brand with emerging ultraportable laptops, tablets and smartphones and establish itself as a major player in the portable computing market against the like of Qaulcomm and AMD etc.  However, with Desktop PCs, the focus in consumer advertising had been on processing power and speed. With portable computing the emphasis also needed to be on low power requirements (implying long battery life). Perhaps Intel could have marketed its new made-for-portables processors implying with their product embedded in your laptop you have a whole “Desktop Inside”.

That was 2005. Today, we are in a very different landscape. Computing is becoming increasingly distributed amongst a range of devices including smartphones, tablets, laptops, smart watches, home monitoring cameras, smart thermostats, smart cars etc. The age of the “internet of things” is upon us. How can Intel re-brand itself for this new frontier? More than power and speed, consumers are now more concerned about connectivity, reliability and security. The meaning of “Intel Inside” (if they are to stick with this) needs to cater to these emerging needs.

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Cool Brittania and the re-invention of  Burberry

The late nineties were a time of reflection and re-evaluation for Britain. In 1997, the Conservative Party (our equivalent of the Republicans) had been in power for almost two decades. The Tories, as they are affectionately or dissaffectionately known, had long had associations with the stuffy image of the upper classes; think wealthy middle aged white males, bowler hats, Harrods, Knightbridge, tweed and of course, the Burberry Check.  The political party also had very strong associations with the British aristocracy and royalty, who were undergoing their own branding turmoil in the wake of Princess Diana’s death. The royal family had underestimated the power of the Diana brand, a more accessible royal than the lot of them. With her tragic death, they were under pressure to re-invent their image and relationship with the public.

With an unprecedented number of youth attaining voting age, Britain was looking to the future. The Labour party had re-invented itself as “New Labor”, a more centrist party led by a young, dynamic guitar playing Tony Blair, courting “Madchester” indie rock bands and using the Britpop tune “Things Can Only Get Better” as his party’s anthem. The Labour party won by a landslide!

At the time I had just arrived in Britain as an undergrad and could immediately feel the excitement of a cultural renaissance in the air and of a society that was embracing change, multiculturalism and chipping away at old class structures. Everything about Britain appeared to be changing under this cultural spotlight, music, film, humor, literature and even the roles of royalty and government. The movement came to be known as Cool Brittania.

Rose Bravo’s re-calibration of the Burberry brand strategy couldn’t have come at a better time for the company in the UK and I believe the company (metaphorically) rode the Cool Brittania (double decker) bus. Granted that many of these cultural reference were purely British but they projected themselves far beyond these tiny islands in northwestern Europe. Burberry’s images for example, of Stella Tennant (an aristocrat) juxtaposed with those of Kate Moss (in her irreverant Burberry check bikini) perfectly captured the zeitgeist.

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Commodification of the Burberry Check

Rose Bravo and her team initially succeeded in bringing back Burberry's luxury brand status and in doing so also expanded the target market for its products. However, by terminating relationships with sub standard partners, particularly in Asia, thereby slashing SKUs by 76%, Burberry also created a vacuum that appears to have started to have given rise to a whole industry of counterfeit products.

Adding to that, during the early 2000s, the increasing popularity of Burberry (particularly in youth culture) as a more ‘accessible’ luxury brand, made it a highly profitable target for counterfeiters. The most recognizable (and easily reproducible) of these counterfeits has to be those that imitate the classic check design, increasingly made popular with a youth audience thanks to a bikini clad Kate Moss and a host of rap artists.

Thus, capturing the value created by Rose Bravo’s new strategy wasn’t as successful as it had the potential to be. Her successor recognized this and immediately decided to reduce the proportion of products with this obvious Burberry identity.

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How does “Brandalism“ affect the Brand Manifold?

The COP21 climate change summit a few months back in Paris became a showcase for the emerging phenomena of “Brandalism”, where activists targeted the corporate sponsors of the conference.

Over the last two decades, media creation/editing tools that were once the reserve of major advertising production houses have now become increasingly accessible to anyone with a computer. Making it possible for activists to create “subvertising” at near the same levels of quality as the original ads, launching a concerted attack at Popper’s Worlds 2 and 3 with regards to the evolution of the Brand identity of these corporations, with the hope of being able to affect World 1 in some cases.

The question is whether this added exposure (albeit negative), erodes the embodied value, exchange value and meanings of the brands targeted or does it have the opposite effect? In terms of the brand manifold, which constituencies are most receptive/affected by these “brandalism” attempts and in what ways are they affected (if at all)?

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The Power of Ritual vs Product Diffusion

I have many friends (old and young) who still purchase Vinyl records and will swear that this is due to the superior quality sound. Yet they will play these records on inferior quality sound systems! According to my observations (and in my humble opinion) it is much more about the ritual of playing records than the quality of sound. Choosing from a large physical representation of their favorite music on their living room wall (as opposed to a filename on an ipod or a computer), taking the record out of its sleeve and dusting it off lovingly (as opposed to dragging the said filename into a playlist), placing it on the turntable platter, placing the needle on the record and sitting back to enjoy the music (with crackles and hisses) while reading the liner notes or admiring the artwork on the record sleeve. The enjoyment lasts for upto 15 minutes, until one has to either turn over the record or repeat the ritual with another record from your collection. In their world, this is the ultimate way to enjoy the music. Yet, many teenagers today, with an equally fanatical passion for music, may never have seen a turntable or a record in their lives. Their ultimate way to enjoy music is very different. Usually on a highly portable device, they will carry more music than you can fit on ten living room walls full of vinyl records. They have their own (very different) rituals (the origins of which go back to the 80s with the advent of the Sony Walkman).

I found the framework presented in Rogers Five Factors a very useful lens to view product adoption and diffusion through. It got me thinking about some of the barriers that contribute to the “chasm” that keeps so many promising products from taking off. In my opinion, one of the major barriers amongst these has to do with what I believe is the power of ritual. Consumers can build up habits, beliefs and comfort zones that can be extremely difficult to transgress. I guess this relates most to Roger’s “Compatibility” factor. This was certainly the case with the Peanut Butter Slice example (although, other factors are also at play). The ritual of making PB&J sandwiches is one that we most associate with Peanut Butter. Perhaps the product would have been a lot more successful had it been marketed with a clean break from this ritual. Perhaps the makers of this product needed to create new rituals that Peanut Butter slices can better facilitate. How about associating the PB slices as dips for chocolate fondue for example, or in a cake mix recipe kit etc? I can see many possibilities. By associating the product too strongly with existing rituals, I believe the makers of PB slices shot themselves in the foot and did not explore the potential of this product as well as they could have.