Snapple

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Overview

Tells the story of Snapple's rise and fall, and poses the question "Can it recover?"

Many soft-drink brands flourished in the 1980s serving New York's Yuppies, but only Snapple made the big time.

Cont.

It went from local to national success and was poised to go international when the founders sold out to Quaker.

The brand proved harder to manage than Quaker anticipated and in 1997 was sold for a fraction of its acquisition price.

The case presents factors accounting for the growth and decline and provides a qualitative study of the brand. What action should the new owners take?

Challenges

Poor brand image --Snapple fired their beloved spokes person, Wendy--Previously quirky image is obscured by the perception that Snapple is a “corporate sell out”

Declining revenue--When bought by Triarc, Snapple's revenue had decreased to nearly half of what it was at the time of acquisition of the Quaker Competition--Competitors have entered the beverage market with an array of similar fruit juices and tea products

Snapple’s early success 

 First, Snapple offered a broad line of beverage products accompanied with 100% Natural that appealed to young, health conscious New York professionals in the 1980s.

Second, Snapple’s proximity to New York City proved to be beneficial for marketing its products. Exposure to the media and celebrities helped the local company gain national attention.

Third, outsourcing the production and product development and built a network of distributors across New York.

Fourth, the premium pricing of its products enabled Snapple to be profitable, despite many failures. Premium pricing on the successful products covered losses on the failures.

Fifth, Snapple successfully promoted and advertised its products with an offbeat blend of public relations and advertising using celebrities.

Quaker Acquisition

Cultural differences between both brands and differences in operating styles between both companies.

Snapple and Gatorade appealed to different audiences in different markets. Quaker failed to acknowledge or accept the cultural differences between the brands, and as such, Snapple lost market share and brand image.

Quaker alienated Snapple’s network of established distributors by attempting to force a partnership. Quaker destroyed healthy relationships that took Snapple years to develop.

Quaker failed to recognize that offering Snapple in larger package and bottles sizes would be unsuccessful given that Snapple sold best in 16-ounce containers. The mass-market operating style for Gatorade was not conducive to Snapple’s traditional business.

Core Issues

Loss of brand identity

Mismanagement of established image

Termination of key spokespeople

Unorganized distribution system

Recommendation

Trairc needs to revitalize the brand by introducing a marketing plan focuses on the unique characteristics that made it successful initially.

Trairc needs to reintroduce Snapple with advertising campaigns in radio, television, print, etc.

Use of 4P’s (Product,Price,Place,Promotion)

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