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Brand Extention plan for Innocent Smoothies into Innocent beauty

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Brand Extension Marketing Plan for Innocent.

WORD COUNT: 3,953 (excluding Title Page, Executive Summary, Contents Page, Glossary, List of Figures, Tables, Personal Reflection, References and Appendices.Date 19th January 2016

The key to extensions of any kind is that the brand must stay true to its original identity. Only in this way will consumers accept the change.Paul Temporal, 2002.

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Executive SummaryThis marketing plan details the brand extension for Innocent to expand their product offerings from the drinks sector into the beauty sector. The continuity of ethics and health will be present in both the parent brand (drinks) and the new product development (Innocent Beauty) and such continuity is essential to the success of brand extensions. Mintel Academic and Mintel Trends reported a decline in demand for fruit juices and smoothies. In contrast, the organic beauty sector is experiencing high demand, with a movement towards kitchen cosmetics. However, online research depicted that superfood facial products are only available in the UK via online websites or are sold in niche/unknown shops and are highly costly. A gap in the market for UK produced and UK based superfood cosmetics at affordable prices is evident. Innocent have a strong understanding of superfood properties and combined with expertise from a dermatologist, there is potential for Innocent Beauty to become the first superfood facial care brand available to the UK mass-market.This marketing plan suggests that Innocent should follow a 3 year proposal, launching Innocent Beauty in January 2017 and gaining a strong share of the UK organic superfood beauty market by December 2019. Understanding consumer behaviour and beauty trends to correctly position themselves, appealing to their target markets is paramount to Innocent Beautys success. Innocent Beauty will innovate towards males (55+), engaging them in superfood skincare and stressing the health benefits to an ageing population. By 2019, Innocent beauty should have a full range of products available in Boots, Superdrug, Tescos, Asda and Sainsburys, meeting the skincare needs for acne, wrinkles and sensitive skin. A focus on new trends like multi-masking and photo-ready skin (for a generation highly involved with online imagery, aka selfies), are innovative strategies to stay ahead of trends and attract new consumers to the brand. A risk for Innocent Beauty is consumers doubting their ability to produce quality skincare, after predominantly specialising in drinks. To control this risk, dermatologists shall lead the process and be available to answer any customer queries. Each product shall include an easy to read guide that explains the ingredients and how superfoods work to target skin concerns. If the 3 year plan is successful, by December 2019, it is estimated that Innocent beauty should have 15 million in revenue.

Table of ContentsExecutive SummaryIGlossaryIVList of FiguresIV1.Introduction- 1 -1.1S.O.S.T.A.C- 1 -2. Situational Analysis- 2 -2.1 Innocent - Background- 3 -2.2 Organic Facial Care Current climate.- 4 -2.3Macro Environment P.E.S.T.L.E Analysis- 5 -2.4 Microenvironment Porters 5 Forces- 6 -2.5 Competitor Analysis.- 8 -2.6 Internal Environment- 8 -3.Consumer Behaviour- 9 -4. Strategic context for Innocents Marketing Strategy- 12 -4.2 Segmentation- 14 -4.4 Target Markets- 16 -4.5 Positioning- 17 -4.6 USP- 19 -5.T.O.W.S- 20 -6. Objectives.- 21 -6.2 S.M.A.R.T objectives- 21 -7.Tactics- 22 -7.1Product- 22 -7.2 Place- 24 -7.3Price and Promotions- 25 -7.4 Performance- 27 -8. Actions- 28 -9.Controls2910. Conclusions33References34Appendices36Appendix 1 Internal Environment Boston Box36Appendix 2 Product Life Cycle and Product Portfolio37Appendix 3 People, Physical Environment, Passion and Personality403.1 B2B40Appendix 4 Personal Reflection41

Glossary

BB = Boston BoxFMCG = Fast Moving Consumer GoodsIB = Innocent BeautyNPD = New Product DevelopmentPEOD = Price Elasticity of DemandP5F = Porters Five ForcesPLC = Product Life CycleR&D = Research and DesignSTP = Segmentation, Targeting and Positioning TM = Target MarketsUSP = Unique Selling Point3YP = Three Year Plan List of FiguresFigure 1: S.C.O.S.T.A.C ModelFigure 2: The Marketing EnvironmentFigure 3: P.E.S.T.L.EFigure 4: Porters 11 ForcesFigure 5: Competitor AnalysisFigure 6: Discontinued Innocent veg/noodle Figure 7: Customer Satisfaction and Post-purchase modelFigure 8: Current consumers Figure 9: Behavioural segmentation (1)Figure 10: Summary of facial skincare 2015/16Figure 11: Elements of Strategic ContextFigure 12: Ansoff MatricFigure 13: Blue Ocean StrategyFigure 14: Demographic SegmentationFigure 15: Behavioural Segmentation (1)Figure 16: D.A.M.PFigure 17: Target MarketsFigure 18: Customer PyramidFigure 19: Perceptual Map (1)Figure 20: Perceptual Map (2) Figure 21: T.O.W.S MatrixFigure 22: T.R.I.M.SFigure 23: Marketing Mix 9PsFigure 24: Kotlers Product LevelsFigure 25: DAGMARFigure 26: Rodgers Innovation of Diffusion Figure 27: Factors of DemandFigure 28: Supply and Demand CurveFigure 29: Framework for Price Perception Formation Figure 30: Product Pricing Figure 31: Estimated RevenuesFigure 32: Monopolistic Competition Figure 33: Communications MixFigure 34: Gantt Chart Actions Figure 35: Risk Analysis

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1.IntroductionInnocent are the market leader in the smoothies segment accounting for 79% of all value sales and enjoy a consistent brand image across factors like trust, quality and reputation. However, Price (2015) documents dangers of excessive sugar in diets that have attracted negative media coverage. This impacted on consumer behaviour, with 62% limiting the amount of sugar in their diet and 36% buying less due to high sugar content in 2015.In contrast, Libby (2015) observes that the skincare market has seen a trend towards kitchen cosmetics. An interest in nutrition and its benefits for the skins appearance has been prominent, with consumers demanding more organic skincare. With the decline in demand for smoothies and an increased demand for organic skincare, this plan proposes that Innocent extend into the beauty sector by producing Innocent Beauty face-care and face-masks using superfoods. The continuity of health and ethically sourced fruit and vegetables (added to their drinks range) can be used within IB, keeping the brand ethos, brand image and brand loyalty fluid.1.1S.O.S.T.A.CIn agreement with Temporal that, the consumer decides if a brand extension is to be successful, the author has adapted the S.O.S.T.A.C model to incorporate consumer behaviour, C, as a segment. S.C.O.S.T.A.C shall be used to guide this marketing plan.

Figure 1:S.C.O.S.T.A.C Model adapted by the author

2. Situational AnalysisThe situational analysis utilizes Mintel data to detail the macro, micro and internal factors to ensure the best succession of Innocents NPD is attained.

Figure 2: The Marketing Environment

(Source: http://www.slideshare.net/mustafvi786/marketing-environment-15497160)2.1 Innocent - Background

Innocent is a UK Company producing and marketing healthy drinks. Innocent was founded in 1999 by Jon Wright, Adam Balon and Richard Reed and employs 350 people, sells over 2 million drinks weekly and has an annual turnover of 200m. Abbing, (2010) comments that, the Innocent brand is a rich cocktail of health, ethics and humour. After realising that the people of the UK were leading busy lives littered with bad habits, Innocent vowed to make health on the go accessible, using 100% natural ingredients.Conversely, as Price notes, sugar and dental concerns are scarring the market, with value and volume sales expected to decline over 2015-2020. Despite Innocents investment in NPD (reduced sugar and fruity water lines), combined with above-the-line advertising, Innocent saw both value and volume sales decline in 2015.

2.2 Organic Facial Care Current climate.Johnson (2015) reports that, the organic beauty industry is booming, with sales up 20 per cent year on year in the UK. The organic health and beauty market is estimated to be worth 1.6 billion. Anon (2015) furthers this observation stating, consumers are increasingly concerned with the environment and their health, thus natural ingredients using chemical-free formulations are receiving consumer attention.Superfood skincare products are created in the same way as fresh juices or smoothies and sparked a trend in 2014, by combining quality skincare with eco-friendly ingredients. Hunter (2015) reveals the trend of 2015/16 is multi-masking, which incorporates two or more facemasks into one treatment. According to the NPD Group Inc., sales of face masks grew by 22.8% between Octobers 2014-2015. The skincare sector represented 24.1% of the beauty market in October 2015, which in total equated to 368m (the face-mask market totalled 6m).

2.3Macro Environment P.E.S.T.L.E AnalysisFigure 3: P.E.S.T.L.E Fill (2014) claims, PESTLE framework is one of the easiest and most popular frameworks for examining the external environment. The author, to a certain extent, agrees with Fills observation, thus P.E.S.T.L.E has been used to assess the external factors for IB. However, there are limitations to P.E.S.T.L.E which are discussed below. Albright (2004) notes, it can be difficult, costly and time consuming to collect data for an in-depth PESTLE analysis; assumptions can form the basis of the data, making it incomplete or incorrect. In terms of PESTLE collated for this plan, the technological section is inconclusive as skincare trends, ingredients and technology change and many companies choose not to release details of their formulas. This made it difficult to fill in the technological section for IB using exact details.PESTLE falls short of providing management with a methodology that includes the multi-le