Mountain Dew has been through many changes since it was introduced in 1942. It started out as a yellow-green drink in a green bottle that had a rush of citrus flavor and more sugar and caffeine than any other soft drink. During the introduction of Mountain Dew it was well known throughout the Eastern seaboard.
At this time the objectives was to gain market share. Mountain Dew became popular because of the stock car racing circuit known as NASCAR. During the 1960s Mountain Dew’s objective was too continued with its heritage from where it originated and began having characters such as Willie to promote the brand.By the 1970s the Mountain Dew brand was assigned BBDO, and the objective for the ad agency was to reach into the suburbs and cities of major metropolitan areas.
The 1980s Mountain Dew objective was to reach suburban teenagers with a new campaign called “Country Cool. ” During the 1990s into the 2000s the corporate objective was to build a campaign around athletic stunts. During these decades of changes Mountain Dew has stood by their strategy creating a strong brand image and “associating Mt. Dew with exhilarating intensity of life’s most exciting, fun adventure.
”The organization that Mountain Dew is affiliated with would be the carbonated soft drink category. The problem that the company appears to be facing is how to keep their current campaign “Do the Dew” working to build on their brand image. Also Mountain Dew had to stay competitive with other caffeinated and sugary energy drinks and noncarbonated drinks. There are many key players in this case such as Scott Moffitt (Marketing Director, Mountain Dew) and Gary Rodkin (CEO, Pepsi Cola North America). The overall objective itself involving the key players would be to choose three new ad concepts out of ten.Two of these advertisements would be run during the Super bowl, but all three would be run through out 2000.
Considering that Mountain Dew is a well branded soft drink the objective that the company is taking is achievable. The strengths of Mountain Dew is that the brand keeps up with the different cultural trends that each decade creates. Also being able to specifically target your brand to your current market gives Mountain Dew another competitive advantage. The weakness that Mountain Dew is facing is how to expand their market to new users while keeping their current consumers happy.
Also keeping their current campaign that is in its eighth year going strong and keeping a good brand image. Competitive Analysis Looking at the Carbonated Soft Drink category it can be looked at as a very competitive market. The competitive environment within the industry itself can be overwhelming. PepsiCo as a company has many different brands alone that make each brand competitive and competing for market share is a big goal for the company as a whole.
The threat of new substitute products is higher than ever.Consumers have many different options that they are not limited to just carbonated soft drinks, they have the option of drinking noncarbonated drinks. Also the energy sports drinks are becoming bigger every year and trying to keep up with the innovation of the new market becomes harder for Mountain Dew. The entry level of carbonated drinks is high. There are many drinks categories in the market and are becoming more popular every year.
The customer has more affect on the company than they realize. With the options of buying different drinks it becomes harder for the consumer to establish brand loyalty.The suppliers do not play a big role in this industry. A lot of these drink manufacturers distribute their own products.
The only threat they face is the competition for shelf space. The external environment clearly gives us a better understanding of this market. Mountain Dew’s strategy has been to gain market share and to create a brand image that makes it seem that Mountain Dew is for you. With the constant innovation of new products in the drink category, it makes the carbonated drink category more competitive. The opportunity that Mountain Dew can make is to build a new campaign that recreates the brand image.
Also another opportunity is to come up with a new target market to reach new consumers. The number one threat is the innovation of new drink categories that is stealing away market share from Mountain Dew. Not being able tot stay competitive in this category can make or break a company. I think that the major competitors of Mountain Dew are faced with this same issue. I’m sure they are coming up with new ideas to compete with the new products and drink categories.
Target Market Coming up with a target market that is consistent with Mountain Dew varies from decade to decade.Each Decade brings new cultural trend. Mountain Dew has done an excellent job at keeping up with these trends and targeting consumers that make their product something they can relate too. Right now Mountain Dew’s target market is male teens 18 years of age.
Also trying to keep the brand appealing and create a cross-over appeal among the 20-39 year old males. The type of buyer that Mountain Dew is targeting is one who has an exhilarating lifestyle and associated with extreme sports. The characteristics of this buyer would be a male in his teens that wants to fit in and be associated with sports.Also this buyer wants to make you think he lives life on the edge and drinks carbonated soft drinks for energy. Mountain Dew’s marketing mix is strong due to the continual growth in sales. The packaging has come through many innovations in its history.
The recent innovation is the 20oz bottle; this was introduced for the impulse buyer. Mountain Dew found out that the margin on this bottle was higher than the 12-packs or 2-litter bottles. Another product innovation was the introduction of 24-pack cases sold to heavy users. Both of these new product innovations are still used today and have continued to grow at a steady rate.Promotion is what drives Mountain Dew to the image it is today.
The case says that Mt. Dew has a 55 million dollar media budget. This is a lot of money entering the year 2000. Mountain Dew relies on their promotion to create sales through the year. The product itself has not changed since it was introduced. It still has the same color and the same taste.
The only change that has been made was the introduction of the diet Mt. Dew. This gave the product more variety and could expand their target market. Being able to price your product well gives you the real competitive advantage.
Mt. Dew has done a great job in keeping up with the competition of other soft drinks. If Mountain Dew can stay competitive then it should see sales to continually grow. Their marketing strategy is to keep appealing to young people to make their brand feel cool among teens. Being able to create ad campaigns targeted to male teens can create a brand loyalty. Financial Analysis Looking at exhibit one it shows tells how the carbonated soft drink sales/share in the millions from 1990-1999.
Every year throughout the 1990s Mountain dew saw a steady growth in market share.In 1990 the market share was 3. 8. By 1999 the market share was up to 7. 1. The same goes for the number of cases sold throughout the 90s.
In 1990 Mountain Dew told 300 million cases. By 1999 they had sold 705 million cases. This says a lot about Mountain Dew and how the company is ran. Seeing a steady growth year by year can only make the company more efficient. Exhibit 2 shows us a better understanding on how much Mountain Dew spends on advertising and how competitive it has become over the years.
The beginning of 1990 Mountain Dew spent 12. million dollars on advertisement. In 1999 That number jumped to 55. 9 million dollars in advertisements This was to ensure that the each advertisement ran during the Super Bowl reached a target audience. Decision/Problem Statement The main issue that management is faced with is how to keep the “Do the Dew” campaign working hard to build the brand given that extreme sports were becoming over exposed.
Also How to respond to the growing threat of noncarbonated soft drinks, like Gatorade and the new highly caffeinated and sugary energy drinks such as Red Bull.The decision that needs to be made and it comes from both Marketing Director and CEO of PepsiCo is how to boost sales and create that once adventurous brand image. The resources that Mountain Dew has are the 10 new ad campaigns for the Super Bowl and for the entire 2000 year. The constraints that Mountain Dew has are if the campaign does not work in renovating their brand image, what would be their next move. Critical Issues The one factor that the case addresses is what new creative advertisements need to be run during the Super Bowl.
They were given ten new ideas and they have to come up with three advertisements to run.The reason for running these ads is to expand appeal of Mountain Dew to new users while reinforcing it among current users. All these issues are root causes, because each campaign has an affect on management. If something goes wrong with their advertisement and they are not reaching their target audience accordingly, then sales would be affected along with their market share. Alternatives Courses of Action Mr. Moffitt has to make some decisions on where the company should go next and how they can reach a new target audience.
The one alternative course of action is to not do anything at all.He may not like any of the new ideas and stick with the current campaign. I do not see any advantage to this course of action; however, the disadvantage is that he could lose a lot of money and brand loyalty. The next alternative is only choosing one of the advertisements to run during the Super Bowl instead of three. The advantage of this is he might think that this one advertisement will get the message across and it will meet the target markets needs.
The disadvantage of this action is possible missing out on potential market share that could have been gained by running the original three advertisements.In looking at the resources that would be affected by each action the resource that has the most to lose would be the marketing director. He is the one who came up with each advertisement and if it did not work then he would be the one to blame. Also the financials would be affected.
If the ad campaign did not work then they would lose a lot of money and possibly create a negative image. Each alternative action has an end result it might be good or it might be bad. The only thing that can be done is to try to best forecast what the market is going to do.If Mountain Dew is on top of their game and can forecast what they think the market will do then they would have no problem turning this ad campaign into a success. Recommendation Out of the five finalists that Mr.
Bruce presented to the executive board of Mountain Dew. Their was three that if I was in Mr. Moffitt shoes I would of chose to be ran during the Super Bowl and throughout the year. The first one I would of chose would be the Cheetah.
It had all the aspects that the marketing team was going for. It showed the target market it also gave that excitement and a daring action. The second one I would of chose would be the Dew or Die.This also gave all the aspects that the marketing team was trying to reach. The last advertisement I would have chosen was by far the hardest.
Out of the three left they really didn’t show much excitement or exhilaration that they were going for. The last chose would have been the showstoppers, because it was aimed for the right target market, it seemed exciting and had athletics involved in the ad. I think that it would have been hard chose to make for anyone. Having to decide the fate of a company can put a lot of stress on a person. I think that if the right decisions are made then the company can expand even further.
