1. Presented by: Seison Johnson, Melissa Nonlall, Ashley Rodeheffer

2.  Originated in Phoenix, Arizona by Herb Bishop in 1938  In 1977, Brooks Products purchased Squirt from Bishop  In 1986, Squirt joined A&W brand which was purchased by Cadbury Schweppes PLC.  Responsibilities for marketing, manufacturing, and distribution of Squirt was assigned to Dr. Pepper/Seven Up (DPSU) in March 1995 when it was acquired by Cadbury.  Major competitors include: Coca Cola and Pepsi-Cola.  Target audience is adults, ages, 18-34.

3.  It is a Caffeine-free, low-sodium carbonated soft drink  Best selling carbonated grapefruit soft drink brand in the U.S.  Marketed under Dr. Pepper/Seven Up Inc; the largest non-cola soft drink enterprise in North America and the third largest soft drink company in the United States.  Product line includes: Squirt (regular), Squirt diet, Ruby Red Squirt (regular), Ruby Red Squirt diet.  There are three major participants in the production and distribution; Concentrate producers, bottlers and retail outlets  Three companies command over 90 percent of carbonated soft drink sales in the U.S.

4. The main problem that DPSU faces in developing Squirt’s advertising and promotion plan is its market targeting and product positioning. In addressing this problem, the following issues need to be assessed:  Re-positioning of Squirt  Redefine the target audience  Focus on Hispanic Consumers and Communities  New Creative Strategy  Advertising expenditures

5.  Squirt targeted 18-4 4 year olds  Squirt advertising emphasized the “hip, cool, experimental nature” of the brand with the message “Beyond the ordinary refreshment-the great citrus taste is incredibly thirst quenching”  Ruby Red Squirt targeted to teens and young adults, ages 12-24 year olds and was positioned as a ”fruity bold way to refresh your thirst”  Ruby Red Squirt advertising focused on its bold taste and extraordinary refreshment with the message “Its fruity berry and citrus taste in incredibly exciting”  Both TV commercials (names “Mountain Bike “ and “Rollerblade”) portrayed Squirt and Ruby Red Squirt in action- oriented biking and skating settings

6.  In 1995, the Advertising Agency, Foote, Cone & Belding (FCB) was asked to revise Squirts current creative strategy, reasoning because it was thought that it was “a bit too intense to fit with the brand.”  Instead of sport situations, they migrated towards the “everyday, on- the-go experience s”  The emphasis on Squirts thirst-quenching benefit remained the same but was now portrayed in “spunky, lively, sociable, colorful, and music driven” advertising that depicted fun-loving, individualistic young adults  Target market was narrowed to 18-34 year olds  Advertising copy described Squirt as ‘Fun relief when you’re dry” with the tag line “Squirt your Thirst”  Squirts positioning and creative execution were revisited in 1999 and again in 2000, following the introduction of Coco Cola’s Citra (a main competitor of Squirt) but no changes were made.

7. In June, 2001, Foote, Cone & Belding (FCB) recommended a new brand position for Squirt:  Target multicultural, 18-24 year olds  Emphasize Squirt’s “thirst-quenching” benefit Formal positioning: “For young multicultural adults who thrive on the excitement and spontaneity of living up to the max, Squirt citrus soda fuels your thirst for living life loud, with an exhilarating taste that’s powerfully thirst-quenching!” According to FCB, this position offers five benefits

8. Strengths:  Largest brand loyalty among competitors  Highest brand awareness among carbonated grapefruit soft drinks  Best selling carbonated grapefruit soft drink  Squirt is bottled and sold by 250 bottlers  Is available in 83 percent of the U.S. bottler markets that represent 85 percent of the total soft drink volume in the United States Weaknesses:  Lower market share (14.7%) as compared to Coca-Cola (41.1) and Pepsi (31.4)  New York City metropolitan area does not have a squirt bottler distributor  Not making changes to their positioning after Citra was introduced  Not being competitive with advertising spending

9. Opportunities:  In Mexico, Squirt is the eighth largest carbonated soft drink brand and the second most popular brand in the grapefruit category  Market targeting: Per capita consumption of soft drinks is higher among Hispanics and African Americans than other racial and ethnic groups and among teens than adults. They also prefer flavored soft drinks.  Advertising: Use a variety of advertising medias to target this new segment  Taste and brand preferences are formed between 12 and 24 Threats:  Coca Cola and Pepsi-Cola’s advertising and promotion expenditures are greater than DPSU  Colas are the dominant flavor in the U.S. carbonated soft drink industry, accounting for about 60 percent of total retail sales in 2000.  As of 2000, Coca Cola’s Citra is available in 95 percent of the U.S. bottler market.  Taste and brand preferences are formed between 12 and 24, Squirt currently targets 18-34

10.  Flavored soft drinks represent one quarter of carbonated soft drink sales  The average American consumes 849 eight ounce servings annually (2.3 servings per day)  Most Carbonated soft drinks in the U.S. are consumed by individuals, ages, 20-49  Teens and young adults are the primary audience for soft drink marketing since taste and brand preference are formed between 12 and 24 years of age.  Per capita consumption of soft drinks is higher among Hispanics and African Americans than any other racial or ethical group  About 25 percent of Americans are younger than 18 and one quarter of the U.S population is Hispanic and African American, and these groups tend to consume carbonated soft drinks.

11.  According to the U.S. Census 2000, Hispanics population in the United States increased by 57.9 percent from 22.4 million in 1990 to 35.3 million in 2000, compared with an increase of 13.2 percent for the total U.S. population  Hispanics accounted for 12.4 percent of the U.S. population and African Americans accounted for 12.4 percent or 34.7 million  More than 75 percent of Hispanics live in the western and southern United States. More than half live in just two states California (11 million) and Texas (6.7 million)  Hispanics and African Americans tend to favor flavor carbonated soft drinks  In 2000, 35 percent of Hispanics were under 18 years old (25.7% U.S. population), median age of Hispanics was 25 years old (U.S. population 35.7 yrs old). Hispanics under 20 represent 58 percent of Los Angeles youth.  Hispanics prefer shopping close to home and tend to patronize mom-and-pop grocery outlets, convenience stores, and bodegas  55.4 percent of Hispanics prefer to see and hear ads in Spanish, while 30.3 percent would chose English and 13.2 percent don’t have a preference. In youth Hispanics, ages 18-24, 44 percent prefer hearing ads in English and 46 percent prefer Spanish  Hispanics don’t like “hard selling” approaches and prefer messages that are real and relevant to them; authenticity is important as is an emotional connection with the brand

12. HispanicPercent Hispanic of RankPlace and StatePopulationTotal Population 1New York, NY2,160,55427.0 2Los Angeles, CA1,719,07346.5 3Chicago, IL753,64426.0 4Houston, TX730,85637.4 5San Antonio, TX671,39458.7 6Phoenix, AZ449,97234.1 7El Paso, TX431,87576.6 8Dallas, TX422,58735.6 9San Diego, CA310,75225.4 10San Jose, CA269,98930.2

13. As a carbonated grapefruit soft drink, Squirt competes directly with Coca-Cola’s two carbonated grapefruit soft drink brands- Fresca and Citra 1. Coca Cola’s Fresca  Introduced in the 1960’s.  It is a caffeine free soft drink targeted at adults, ages 30 and older.  More recently used as a mixer  In 1992, it was one of the fastest growing soft drinks in the U.S. 2. Coca Cola’s Citra  Introduced in 1997 as a “sugared” counterpart to Fresca.  No diet version, but is caffeine free.  Targeted at teens and young adults.

14. Coca-Cola Pepsi Cola  All brands contain caffeine  All brands are sold in regular and diet, except Surge  Mountain Dew is the largest selling citrus favored soft drink brand in the U.S. …  Surge was introduced in 1997 to attract consumers before they became Mountain Dew drinkers…  Mello Yellow and Sun Drop are popular in the South East U.S.

15. Case Volume Trend for major Carbonated Grapefruit and Citrus-Flavored Brands in the United States: 1996-2000 Case volume (millions) by year Company/ Brands19961997199819992000 Coca Cola Fresca2826.225.925.524.1 Citra NA 2126.215.6 Mellow Yellow5946.642.441.645.7 Surge NA6951.826.711.8 Pepsi-Cola Mountain Dew605.9683.2748.1793809.8 Regular535.6605.2665.1705715.6 Diet70.0378838894.2 Dr Pepper/ 7up Sundrop19.720.120.420.120.2 Squirt/Ruby Red55.855.754.85654.6 Total case Volume768.4900.8964.4989.1981.8

16. Estimated Media Advertising Spending for Major Carbonated Grapefruit and Citrus-Flavored Brands in the United States: 1996-2000 Estimated Media Advertising Expenditures ($000) by Year Company/ Brands19961997199819992000 Coca Cola Fresca2,471.50730.2672.6N.S CitraNA1,119.106,711.6010,100.4098.40 Mellow Yellow1,407.801,524.201,199.701,010.60773.10 SurgeNA13,61117,846.7018,967.40243.8 Pepsi-Cola Mountain Dew (Regular/ Diet)28,991.3033,951.1040,104.3037,074.3050,384.60 Dr Pepper/ 7up Sundrop10.9429.63391.8314.1 Squirt/Regular/Diet3,485.101,657.60955.8601.5390 Squirt/Ruby Red1,807.60537.2N.S Key NA=Not Available: N.S.= No Significant Expenditures

17. There are three different options for the market targeting and positioning of Squirt that exist: 1. Continue the present market targeting and positioning strategy 2. Adopt the marketing and positioning recommendations made by FCB 3. Develop another market targeting and positioning strategy, which may or may not include elements of the current and recommended strategy

18. Mountain Dew Young, cool, and hip Squirt Citra Fresca Sundrop Mello Yellow Surge RefreshingThirst- quenching Not-so-young, cool, and hip

19. As a group, it is our recommendation that DPSU lean towards the third course of action. We actually feel that FCB’s market targeting and positioning recommendations are heading in the right direction but we chose the third course of action because we have decided to make slight changes to a few things. The following steps highlight the selected course of action with a few of our additions: 1. Start focusing on 15-24 year olds 2. Adopt FCB ‘s recommended positioning statement 3. Add a bottler in the New York metropolitan area to service the large Hispanic and African American segments 4. Initiate Spanish speaking/text advertising in Southern California and Texas 5. In other largely populated Hispanic cities advertising will feature people of Hispanic descent and customs but not necessarily in Spanish. 6. Increase all advertising expenditure and initiate a multicultural advertising campaign throughout the whole United States by using actors of other races and ethnicities