New product launch is a very challenging process for many companies, especially those operating in very competitive industries where rivalry is extreme. In order to ensure that a successful product launch is attained, key success factors of a new product should be communicated well to the public. A re-launch of the new beverage called New Coke in the North American market would require a critical analysis of the drinks and beverages market in order to assess its success. Through market analysis, competitive analysis, and the assessment of the marketing strategies for the new product, its successful re-launch into the market will be evaluated.
The market size of non-alcoholic drinks and beverages in the North America is very large and can accommodate the re-launched product. North America is one of the biggest consumers of soft drinks in the world due to the developed economy that boosts people’s purchasing power. However, ed. J?rgens (2013) argues that due to the growing health consciousness and diabetes among the consumers, the demand for soft drinks has declined significantly. The New Coke, which is sugar-free, will serve as a perfect replacement for the consumers who have diabetic concerns. The re-launch of New Coke will perfectly fit into the new growing market for sugar-free soft drinks in the North America.
The increasing growth rate of sugar-free soft drinks in the North America provides a good market for this product, since its re-launch targets consumers with health concerns. The new policies provided by the United Stated government through the Food Safety and Modernization Act regulate the production of food and beverages that have health hazards. This regulation will have no detrimental influence on the success of the New Coke, because it is manufactured in full compliance with its requirements (Kapferer 2012).
The New Coke will be re-launched in a very competitive industry full of many products that substitute each other in a direct way. The drinks and beverage industry in the North America is dominated by the Coca-Cola Company and Pepsi whose products are very competitive as they allow consumers to achieve the same purpose. Due to the different tastes and preferences among the consumers of soft drinks, the leading producers have embarked on continuous innovation in order to satisfy the most extraordinary preferences (Stark 2015). Therefore, the industry in which the New Coke is re-launched is extremely competitive. Thus, the re-introduction of this improved product should guarantee proper market positioning.
The beverage industry in the North America is characterized by declining profits. They can be associated with the raising health concerns of many customers, and this trend has discouraged a high rate of consumption of soft drinks. The industry has, however, been performing well over the past years due to many consumers who can afford soft drinks (Kapferer 2012). Despite the challenging drops in revenues, the industry is still promising to grow in the future because of the innovations of its key leaders. The main players have focused on producing healthy drinks in order to address the raised health concerns.
The direct competitors for this product are Diet Coke and Pepsi Max, which have similar ingredients as the re-launched New Coke. These two direct competitors of New Coke aim to satisfy the needs of the soft drinks consumers who have health concerns, especially those who suffer from diabetes. All of these drinks are sugar-free, just like the New Coke; thus, they attract many Americans who want beverages that contain no sweet substances (Aaker 2012). Other indirect competitors of the New Coke are Sprite, Fanta, Kick Start and Tropicana, which offer the same number of calories. They serve as potential competitors to the new product because they have the same purpose of refreshment, but they are still preferred by customers who have no problems with excess sugar or calories.
The Product Idea
The product idea of the New Coke is a great concept, because it fits the North American market very well. The New Coke is an improvement of the original Coke in that it has been changed to the sugar-free option, and now it has no health implications for diabetic consumers. Theis idea deserves the name of the greatest innovation in the beverages industry, since it is designed to suit all types of consumers irrespective of their health status (Rothaermel 2015). According to the preliminary research of the North America market, the new product is presumed to be very successful upon its launch, since it will capture a much wider share of the American market.
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Proper positioning of the new product in the North America market is a guarantee of a boost sales, because Americans are very conscious about their health status. Therefore, they will prefer this drink compared to other products that have a lot of sugar and calories. The concept of sugar-free nature provides a new beverage with a competitive advantage over other drinks, since this feature stands out as a unique benefit. Since the beverages market is very competitive, the idea of this unique product with health benefits makes it sellable (Pendergrast 2013). The New Coke will be promoted on the basis of its unique ingredients to capture the attention of the soft drinks consumers who have health concerns related to sugar levels.
The Analysis of Marketing Strategies
In order to ensure that the product is re-launched successfully, there is a need to analyse the marketing strategies deployed by the firm to sell the drink. The development of a decent marketing strategy will involve a detailed customer analysis in order to get to know the target consumers of the new product. Through customer segmentation, it will be very easy to understand different consumer needs and address them accordingly. The analysis of the customer data will facilitate the development of a unique marketing campaign that will reach all the target customers and forecast the demand for the new product (Tedlow & Jones 2014). Strategies that will ensure continuous product development should also be devised to ascertain that the product will continuously satisfy the tastes and preferences of the existing customers and attract new ones.
Although the pricing of a new product may be critical for determining its success in the market, the New Coke does not require a unique pricing strategy, because there is already an established market price for products with similar characteristics. However, since price is perceived as an indicator of the quality, the New Coke will be priced higher compared to close competitors in order to show its uniqueness and improved quality. Unique branding of the product will also be appropriate, because it will create an emotional connection with the consumers, thus building customer loyalty (Tedlow & Jones 2014). The branding of the new product should be intertwined with the close substitutes – Coke Zero or Diet Coke – to notify the customers of the existence of the most advanced version of the product.
The promotion and distribution of the new drink should guarantee that the customers know about the existence of the new product and its availability. New Coke should be made available to all consumers in the North American market to ensure that it competes rigorously with the already existing products (Gatignon, Gotteland & Haon 2016). Through the proper management of distribution channels, the New Coke will gain a large market share and meet the specific preferences of soft drink consumers. The new product should also be spread to the rest of the world in order to guarantee that it gains global acceptance so that it may compete with the other well-established international products within the same industry.
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Summary of the Key Success Factors
The key success factors experienced during the launch of the new product can be used to evaluate whether the process is successful. Such main success indicators involve a clear understanding of the customers according to their needs, their perception of the product and loyalty. Another success determinant is strong product development that is achieved through brainstorming with an initial objectives of profitability, customer satisfaction and increased sales volume (Ferrell & Hartline 2012). Correct differentiation and clear positioning of the new product in the market are pivotal, since they enable the customers to critically compare the benefits of the new product with those of the already existing competing brands.
To conclude, the New Coke re-launch will be a success in the North American market. A growing number of consumers who care about their sugar intake will prefer this drink over others. Its progress can be measured based on the level of market penetration, the repeat purchase rate, and the level of customer loyalty developed over time. In addition, the size of the market share dedicated to the new product can be used to access the success rate of its launch. Lastly, customer satisfaction will be a significant indicator of the popularity of the New Coke.