Case Study


ASIA PACIFIC INTERNATIONAL COLLEGE

SBM3102 – Assignment 1 Case Study

The relaunch of Mother


Coca-Cola Amatil (CCA) is one of the largest bottlers of non-alcoholic ready-to-drink beverages in the Asia Pacific region and one of the world’s top five Coca-Cola bottlers. The company employs more than 15,000 people and has access to more than 265 million consumers through over 700,000 active customers. CCA has operations in five countries – Australia, New Zealand, Fiji, Indonesia and Papua New Guinea – manufacturing, selling and distributing a diversified product portfolio including carbonated soft drinks, water, sports and energy drinks, fruit juice, flavoured milk, coffee and packaged ready-to-eat fruit and vegetable products. CCA’s major shareholder – The Coca-Cola Company – owns 30% of CCA’s shares and has two directors on CCA’s eight-member board of directors. With a market capitalization of over A$8 billion, CCA is one of the Australia’s ‘Top-50’ listed companies. The support of the Coca-Cola Company provides major advantage for CCA over its competitors Since the energy drink market has been the fastest growing segment within soft drinks market and the company did not have any energy drink in its portfolio, in the beginning of 2007, it introduced Mother to compete with the two leading energy drinks in the market, V and Red Bull, which at that time dominated the A$151 million industry and accounted for 94 per cent of sales. The company was hoping that Mother would finally become a successful energy drink in its portfolio. Since 2001, CCA tried to launch several energy drinks such as Burn, Lift Plus or Recharge; however, all of them have failed.
Mother was launched to a great fanfare with a $15 million marketing budget, created by Publicist Mojo, featuring animated animals describing the natural content and benefits of the drink. But the campaign failed and sales dropped. CCA did not want to give up; therefore they conducted extensive marketing research and learnt that consumers did not like the taste, neither were attracted by the natural benefits of the drink. Perhaps, with such energy drinks they should have targeted women to whom the natural content of the drink as well as animals in the advertisement would be more appealing. 
However, the company aimed to target ‘red blooded’ 18–34-year old males who were, in general, more attracted by the potent effect of energy drinks. As a result, in mid-2008, CCA altered the formulation with respect to taste and addressed consumer dissatisfaction in regard to the standard 250-ml can by doubling the size to 500 ml without affecting the cost, thus exceeding V and Red Bull that remained at 250 ml. Except for the size of the can, the company also changed the logo and selected a message strategy for its relaunch. The key message was ‘New Mother – tastes nothing like the old one’, which aimed to demonstrate in a humorous appeal that the company had made a mistake about the taste of the previous version. Another message was ‘New Mother – Double the Energy Hit’ aiming to point out the powerful content of 500-ml cans.

In relation to this change in strategy, in late 2008, V released a 500-ml can of its original product and a new product called SAMEDI. In early 2009, Red Bull released their ‘XXL’ can, a 473-ml can, to compete with Mother. Other sizes of Mother started to appear on the market in 2010, such as a 375-ml glass bottle, a 300-ml can as well as the ‘surge’ and ‘lemon’ flavour 500 ml variations.


Industry and competitors

The energy drink segment is the fastest growing within the A$2 billion (2006) carbonated soft drink market. The energy drink segment is worth A$151 million and is growing by 47 per cent a year since 2006. Energy drinks account for 22 per cent of total drink sales. According to AC Nielsen data, Red Bull and V drink account for the majority (90 per cent) of sales within the Australian energy drink segment.

There are many new energy drinks trying to enter the market every year as well as lots of brands trying to gain at least minimal market share and compete with V drink and Red Bull, which represent the main competition. The new energy drinks need to overcome the powerful marketing of both drinks. Moreover, there is a great loyalty among the users of both brands, and V and Red Bull have established intimate relationship with their retail channels. Coffee and tea can represent substitute products; however, the main advantage of energy drinks is that they deliver the same and even better effect but in highly refreshing form, which is a good point considering the Australian climate.


Marketing communications

Marketing of the Coca-Cola Company is known worldwide for its creativity and message consistency. The IMC campaign of the first version of Mother energy drink was aiming to communicate a message emphasising the natural content of the drink. The main IMC tools of the campaign included TV ads, printed ads with animated animals and sampling. However, the campaign did not appeal to the selected target market (18–24-year old males).
The campaign for Mother’s relaunch focuses on the same target market and was supported by extensive research. The message strategy is based on admitting the company’s mistake about the taste of the first version in a humorous style as well as on highlighting the potent content that 500-ml cans offer. Besides the packaging, the company’s IMC agency has decided to utilise the following IMC tools: TV and cinema ads, blogging and sponsorship of V8 Ute driver, Layton Crambrook.


Discussion questions


1. Discuss the marketing orientation used by Coca Cola Amatil, in relaunching “Mother”


2.    Conduct strength and weakness analysis of “Mother”


3.  Describe the consumer decision making process of “Mothers” based on the consumer decision making model (need recognition, information search, evaluation of alternative, purchase and post purchase evaluation)


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