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White Claw Branded Vodka

White Claw first entered the alcoholic beverage industry in 2016 with the release of its alcoholic seltzer water. The drink is made with a malted alcohol base, carbonated water, and fruit flavoring. In its initial launch, White Claw was made in four different flavor varieties.

Today the company offers twelve flavors and has dominated the hard seltzer market since its release.  While the hard seltzer category has been growing exponentially since 2015, a study by the IWSR Drinks Market Analysis reveals that sales volumes of spirit-based, ready-to-drink cocktails will overtake hard seltzers in the next two years.

In response to this industry-wide shift away from hard seltzers and towards spirits, White Claw has unveiled its line of premium flavored vodka and ready-to-drink vodka soda cocktails. The bottles of vodka will be sold in select markets across North America and will have four flavor options including black cherry, pineapple, mango, and unflavored.

With this notable shift in the industry, I think that it is advantageous for White Claw to expand its product line to address current and future consumer preferences. They are an established brand and individuals that enjoy their hard seltzers will likely be interested in trying the new products that they release. They are also appealing to their current customers and staying true to their brand by flavoring the vodka with the most popular hard seltzer flavors. While White Claw has an existing fan base for its hard seltzer, how will it be able to generate revenue with its development of spirit-based products?

Based on Porter's model for industry profitability, the factor that will have the greatest impact on White Claw’s ability to generate revenue is competition among existing firms. Because there is little differentiation between products within the spirits industry, there is intense competition between firms to acquire market share. With brands like Smirnoff, Kettle One, and Absolut dominating the vodka segment, White Claw will need to focus its marketing on distinguishing itself from other companies and investing in providing a superior product.

White Claw experienced its initial success by presenting itself as more than just a beverage company but rather a lifestyle brand. Their gender-neutral packaging and beachy aesthetic made their products very appealing to younger consumers.

By continuing this approach with their line of premium flavored vodka and ready-to-drink vodka soda cocktails, I think that they will be able to attract both their current consumers and individuals who were not initially drawn to the brand for their hard seltzer products. As the summer months approach, I look forward to following this story and seeing what other products White Claw releases in the future.

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[helenkiechlinsmarketingblog]

Spotify

Spotify is a Swedish audio streaming provider that was founded on April 23, 2006, by Martin Lorentzon and Daniel Ek. The service officially launched in 2008 and at the time their platform was unique because it allowed listeners to stream their favorite songs while compensating the musicians for their work. Today they are the largest audio streaming company in the world with approximately 456 million active listeners each month.

Recently, the company has focused on growing its revenue by expanding its content library and placing an emphasis on the paid subscription tier of the platform. They have done this by acquiring over 4 million podcasts and 300,000 audiobooks that are available for purchase. In doing Spotify hopes to portray itself as more than just a music streaming service, but rather a diversified audio business.

Based on my research, I believe that the audio streaming industry is in the growth stage of the product life cycle. I have determined this based on the intense competition between companies and the increased interest in adding features and improving services for consumers.

Today, some of Spotify’s top competitors include Apple Music, Amazon Music, Pandora, SoundCloud, and TIDAL. Of all these competitors, Apple Music is especially a concern for Spotify because they only provide a paid subscription service whereas Spotify offers a popular ad-supported tier that is free of charge for subscribers. This greatly impacts Spotify’s revenue and its ability to maintain market share. While they have been working to improve their service by providing curated playlists, expanding their content library, and releasing the highly anticipated “Spotify Wrapped” each year, how can Spotify sustain its dominance in the industry with so many current and emerging audio streaming competitors?

One way I believe that Spotify can maintain its competitive edge is to focus on the submarket of individuals over the age of 35. According to the company’s demographics, over half of its users are between the ages of 18 and 34. While individuals in this age range are the primary consumers of Spotify, the average age of listeners has been steadily increasing over the past few years.

The company could appeal to this older audience by promoting the ease of use of their service and how it is accessible for anyone whether they are commuting, relaxing at home, cooking, cleaning, or falling asleep. In addition, Spotify should continue to invest in marking its paid Spotify Premium tier. This includes their in-app advertisements and other current promotional activities such as billboards, commercials, and music festivals. As a loyal Spotify user myself, I hope they continue to improve the platform and can maintain their edge in this highly competitive industry.

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Kraft Heinz Spicy Ketchup

When consumers think of Kraft Heinz, many would typically associate the brand with their classic condiments such as ketchup, mustard, and relish. In fact, Heinz is ranked first in overall ketchup sales in the United States, holding over 50% of the market share. While they are known for these condiment products, they have almost completely withheld from the hot sauce segment. That is, until now. On April 4th, 2023, Kraft Heinz broke into this market with the launch of three spicy ketchup flavors and one hot sauce.

The spicy ketchup flavors range from medium heat to extra spicy and the hot sauce, known as Hot 57 Sauce, is flavored with jalapeno peppers. These new products are a part of the company’s plan to grow sales in North America by two billion dollars over the next four years.

With its global brand image, it makes sense that Kraft Heinz is investing in new product development to increase sales and revenue. According to Pedro Navio, Kraft Heinz’s U.S. president of Taste, Meals and Away from Home, the company has worked to develop a process for creating innovative products known as One Innovation Engine. This method of new product development focuses on addressing consumers’ current and future needs.

Due to the rise in food prices, many Americans are preparing more meals at home as opposed to eating at a restaurant. With that, consumers are looking for ways they can try new flavors and elevate their experience. In addition, hot sauce sales have grown approximately 15% over the past year. Millennials and Gen Z shoppers greatly contribute to this increase as a Mintel Group research report reveals that nearly fifty percent use spicy sauces regularly and they are constantly looking for new options to try.

In Euromonitor International’s Top 10 Global Consumer Trends 2023, one of the ideas that is highlighted is that consumers are not increasing their spending this year. High inflation and economic uncertainty are making consumers choosier in what items they decide to purchase. With that, I think that it is advantageous for Kraft Heinz to be developing products with budgeteers in mind.

By developing low-cost items, such as condiments, with exciting new flavors, consumers will likely be willing to try them if they believe it will elevate their experience cooking at home. Navio states that the company has plans to deliver 80% more innovations this year compared to last.

While I think that Kraft Heinz has an advantage in the hot sauce market with their widespread brand recognition, I wonder if they will experience the sales growth they are hoping for with hundreds of competitors in the market. How will they be able to differentiate themselves as the superior product with so many established hot sauce brands in this segment? I look forward to following this story and seeing what kind of innovations Kraft Heinz will be releasing in the near future. 

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