Thursday, May 31, 2018

Relevance of Innocent Smoothies


Top 5 Background Readings:

Marketing Management: First European Edition by Philip Kotler, Kevin Keller, Dr Mairead Brady, Malcolm Goodman, Mr Torben Hansen

A Book About Innocent: Our Story And Some Stuff Weve Learned by Dan Germain

Strategies for Cutting Company Costs: Leading CEOs on Establishing Spending Priorities, Ensuring Quality While Cutting Costs, and Positioning the Company for Recovery by Thomson Reuters

Porter's generic strategies by Gerardus Blokdyk

Cognitive Differentiation: A Structural Variable Underlying the Fishbein Attitude Model by Richard Miller Durand

THE PROJECT RATIONALE


1. The Relevance of Innocent Smoothies 

As researched by Medders (2013), “a smoothie is a thick drink made in a blender”. Components of smoothies, in general are different fruits, and can comprise of ingredients like those of blunt or cream milk, soy-milk, ice cream, yogurt or some nutritional supplements with varied flavours. In past few years, smoothies are getting much attention for being healthier than any other drink. Medders specifies that developments of smoothies around the world gets noted since the mid of 20th century.
Following the thread of popularity, in 1999, Innocent Drinks emerged with its specialisation in making smoothies. In a report by Walis (2007), Reed (one of the founders) confirms that all these years lots of transformations are adopted by the company, yet the founding values are all kept intact. The products were kept largely the way they were in the year of inception. Amidst enormous challenges the company still remains as one of the most preferred and celebrated brands in the UK. Reed further adds that with a continuous mode of expansion and extended workforce of more than 187 employees, the company attains 65% of the UK domestic market. Above all there is the turnover of £100m and room for further growth in the European marketplace.
Thus, the most relevant element is still the concerns of values and ethics as maintained by the company and the added aspirations of making itself more genuine by meeting consumer-oriented demands. This has been authenticated well as the site declares

“Our delicious tropical juice has won gold prize at the 2013 Grocer Awards.
It scored a stupendous 49 out of 50 for taste, based on votes from actual real people, as well as a panel of experts.” (Official Site, 2013)

2. Historical Entity of Innocent Drinks                      

            It was in the year 1999, Innocent Smoothies, categorised under the brand of Innocent Drinks; was established by three graduates from Cambridge University. These graduates were, Richard Reed, Jon Wright and Adam Balon. The firm spent a total amount of £500 over fruits that were transformed into smoothies and apparently sold the smoothies at a small music festival in London the same year. These founders were very keen in maintaining "socially and environmentally-aware" attitude and as such the company maintained the same throughout the process of its developments (BBC, 2009). The company concentrated in the making of different smoothies, flavoured juices and varied veg pots. These products were sold in different supermarkets, various outlets and coffee shops. In the early decades of 21st century, the company sold more than 2 million smoothies every week and attained a sustainable business atmosphere.

2.1 Structure of Innocent Drinks           

            The company has a strong growth rate every year till 2012. The company is currently at a stage of horizontal expansion towards new regional markets targeting Europe. Coca-Cola has very ambitious expansion plans of global expansion and preparing for expansion in to the US market. Presently Innocent Drinks has eight offices and a total number of around two hundred and fifty employees working for the company. The organisational structure of Innocent Drinks consists of the essential stake holders – the people, Information Technology and environment, and finance; their United Kingdom teams – commercial, business delivery and marketing; operations – production, technical, fruits and ingredient suppliers, and logistics; and the other extended offices – Alpine, Benelux, France, Germany, Ireland, and Scandinavia.  The Innocent Drinks recognises every element of the company as an organ and for this very reason all of the minor and major, operational as well as managerial elements have been recognised as the organs of the particular company.  Richard Reed, Adam Balon and Jon Wright are the founding directors of the company – Innocent Drinks.

2.2 Business-oriented Scopes of Innocent Drinks       

            The company started with Smoothies products, which is the main product so far, and is currently innovating and expanding their product ranges to “veg & noodle pots”, “fruit tubes” and “fruit juices”. The company has a strategy of differentiating their Smoothies products by being 100% natural and by using only natural components for Smoothies and fruit juice products. The success and failure of a company and the scope of its business has a lot to do with the products or services it offers. In some or more cases, the product could be sold in huge quantity but that does not hold true for most of the products and company. Good and efficient marketing plan helps in making great sale and in certain cases becomes the sole reason for the sale but it is the product that decides the scope of the business. In this case, that is, “Super Smoothies” by the Innocent Drinks, it is their smoothie that is going to decide their business success or failure.
The performance of the company has made it the leading company. The product slated to be introduces has been very popular with the mass so much so that it made the juice and smoothies industry as a multi-billion dollar industry by  the beginning of this millennium. According to the observations made by the research and going by the past record of the smoothies with the mass and the popularity of the company which is going to launch it as their new product, it could be said that it has a great potential for making a good business endeavour. It has a great scope for business.

2.3 Financial positioning of Innocent Drinks              

                        Innocent Drinks enjoys being the market-leading company with the production and selling of Smoothies controlling 72% market share (Asimons, 2013). Coca-Cola acquired 18% share of the company in 2009 and further 38% in 2010 as part of a deal to hold 90% share of the company (Neate, 2013), Coca-Cola’s current stake is 56%. As an overwhelming majority holder, Coca-Cola took over the management bringing on board their expertise and long history in the soft drink industry. According to a report by Reynolds (2013), the sale of Innocent Drinks was valued at £213.5m in 2012. The reports analyses the sale to be higher than the previous year by 36.6 per cent.

Figure 1 Comparison of Price between Innocent and Homemade smoothies
Source: Johnston (2008)
The performance of the Innocent Drinks is believed to have taken this huge leap in sales after it shifted to the production of pure fruit juices. Innocent Drinks has been one of the most popular drink brands in the United Kingdom. It captures the attention and wishes of the customers and designs their drinks accordingly. The young ideas and concepts did give it a fresh and innovative touch that was needed for the country which was mostly exposed to hard beverages. Financial success and popularity among the mass is a product of such innovative ideas and great products. The shift of the Innocent Drinks’ to the production of pure fruit juices has added to its financial gain. With increasing awareness on having healthy food and drinks the trend has shifted to being natural and healthy. Such a scenario makes the rise in sale of the Innocent Drinks, all the more promising and simultaneously assures the financial growth of the company.
2.3.1 Financial Performance of Innocent Smoothies                      
                   Innocent Drinks’ main products are the Smoothies and the fruit juice, which is a differentiated segment from the general soft drink industry. According to the “The Fruit Juices and Fruit Nectars (England) Regulations, 2003”, the legal definition of fruit juice or pure juice is 100% juice however the Smoothies are a whole crushed fresh fruits within a short shelf life. It is important to go through industry analysis for better understanding of rivals and forces affecting the company within the industry, and to draw a conclusion about how attractive the industry is, how much profitable it is and whether it is strategically sustainable or not. The conclusion will be a starting point for the campaign and could be vital for a good integration aligning all objectives to the marketing opportunities and objectives.
         
Under the pressure of on-going recession and economic downturn could be the reasons for such a market condition. The Smoothie segment is considered part of the fruit juice industry representing 5% of it.

Figure 2 Amount of Juice Content in Smoothies
Source: British Soft Drink (2011)

A study by Datamonitors (2010) showed a profound decline in the segment by £212.7m since 2007, falling down by 49 per cent. The report showed that the decline is due to changing habits of consumers who were switching from expensive brands of health drinks and juices to a
substitute juice brand and soft drinks. (MarketLine, 2011).

Figure 3 UK Smoothie Value Segment for 2005-10 (UK Pounds in Million)
Source: Marketline (2011)
At the same time, the soft drink segment has grown in the same period by 4.5% according to BSDA Soft Drinks Report (2009), meaning that the decline in the Smoothies and juice drink was substituted by cheaper soft drinks which confirm the economic factor as a major force, which should be a temporary effect (KeyNote: Manley, 2009). On the other hand, soft drink is not a sustainable product on the very long run, given that Prime Minister David Cameron has been discussing plans, similar to Danish and finish laws, called “Fat tax” presented October 2011 (Keynote, 2013) which impose taxes on soft and carbonated products given that they have high sugar and additives that is not good for health, such tax will make Smoothies products more competitive. Also the EU wide voluntary scheme campaigning to banns me additives and conducting awareness campaign around EU schools. The trend in the market is for the “natural” and “Healthy” as a slow but effective market driver on the very long term. It is for this very reason that the sale of smoothies and other Innocent Drinks’ have once again plummeted high.

            2.4 Core Vision and Mission of Innocent Drinks                    

                      The core value of the company – Innocent Drinks, resonates in the very sentences that they strongly believe in, “Create a business we can be proud of". It is the founding principle and core value of their business venture that grew to become the Innocent Drinks. As the research delved into the depth of the company, the story of its emergence, its journey till 2013, its achievements and effect on the market, there have been this very belief that seemed to have resonated through every phase. It is the demand of the young minds and firm belief of making substantial money out of selling smoothies and juices that the three Cambridge University graduates resigned from their secured jobs and landed in the uncertain ground of business. They took a chance and a leap of faith with their core belief of being a part of a proud business house. The other values of Innocent Drinks are firstly, being natural, which means producing completely natural, delicious and healthy products every time. Secondly, being creatively entrepreneur and challenging the present condition in order to rise above it and excel in the due course. Thirdly, being responsible to the consumers, customers and the environment so that they situation improves and never deteriorates. Fourthly, it believes in being fairly commercial because it is indeed a business house that needs profit for the survival of the company itself, people associated with it and even for the society.  Lastly, it believes in being generous through charity for the needy.

3. Methodological Approach                    

The methodological approach makes a wide ranged analysis of a particular research, through both qualitative and quantitative tools, and thereby offers necessary authentic information about the selected topic (Kumar, 2010).  The methodology followed here, is based on the models from theoretical derivations that are empirically proved well. Further the resources are declared with specifications to the concerned position of IMC, advertising, coomunication in general, and Innocent Smoothies in particular.

            3.1 Analysis of the Status

In order to analyse the status of Innocent Smoothies through the analysis of PESTEL, Porter’s Five Forces, BCG Matrix, SWOT Analysis, Ansoff Model, Porter’s Generic Strategy and Marketing Mix 4Ps.    
Model
Relevance to the Research
PESTEL Model
This model aims in analysing the political, economic, social, technological, legal and environmental issues related to Innocent Smoothies for better understanding of its business structure (CIPD, 2013)
Porter's Five Forces
This model inspire in looking into the bargaining power of the consumer and suppliers, threats created by new company and substitute products for Innocent Smoothies (Porter, 2008, p.86-104)
BCG Matrix
This analysis offers scope to understand the performance of Innocent Smooties with secial reference to marketing growth of the company (BCG, 2013)
SWOT Analysis
This analysis makes an inherent inspection over the status of Innocent Smoothies and gives the strength, weaknesses, opportunity and threats related to the company (Menon, A. et al. 1999)

            3.2 Justifications for Campaign             

Model
Relevance to the Research
Ansoff Model
This model offers the outline of market expansion and scopes for further development of Innocent Smoothies with futuristic success format (Ansoff, 2006)
Porter's Generic Strategies
This model shows the competency and scope for Innocent Smoothies in the market and creates path for expansion (Murray, 1988, p. 396)
Marketing Mix 4Ps
This approach is meant to offer the company with necessary knowledge about all those features and properties that must be adopted for a better status in the market (Needham, 1996)

            3.3 Campaign Developments as by IMC          

Model
Relevance to the Innocent Smoothies
Marketing and Promotion
the concentration here is on the application of marketing communication by Innocent Smoothies for marketing success
Inverted Pyramid
the marketing communication gets well demonstrated by the inverted pyramid and offers Innocent Smoothies the basis of attaining awareness about the product and consumer related domains
VAL Segmentation
through this approach the compnay can attain growth by analysing the behavioural aspects of the consumers and pave ways for appropriate marketing strategies
Chain of Means-End
this is a step by step model that permits the company in getting perceptions of the consumers, along with their goals and attitude
Branding
through this model the company can attain a unique identity in the market, as against the competitors
Brand Equity Model
this model is based on consumer preferences and gives the company enough room for making a shift from inertia to the state of advocacy
Fishbein Model
the company can follow this model and can comprehend the attitude and belief as followed by the consumers
Decision Making
it highlights the process of making decision in the consumer 
Conditioning
it will offer the Innocent Smoothies with the framework of understanding the consumer and further enhance its position among them
Reference Group
this group is about the consumption pattern that can make a consumer take the decision for buying a particular product. This is an indirect motivational way towards buying of a product
Positioning Model
it shows the company, its position in the mind of the consumer and manage in the process of realizing attributions against the competitors 

           

3.4 Methodological Resources                

1. Marketing Communication Sources
Ansoff, I. H. (2006) The Secrets of Strategic Management:: The Ansoffian Approach. BookSurge Publishing
Belch, G. and Blech, M. (2004) Advertising and promotion An Integrated Marketing.
Fill, C., (2011). Essentials of Marketing Communications.
Kumar, R. (2010) Research Methodology: A Step-by-Step Guide for Beginners. SAGE Publications Ltd; Third Edition
Needham, D. (1996). Business for Higher Awards. Oxford, England: Heinemann
Pickton, D. and Broderick, A., (2005).Integrated Marketing Communications. 2nd ed.
Porter, M. E. (2008) The Five Competitive Forces that Shape Strategy. Harvard Business Review
Shimp. T. (2010). Integrated marketing communication in advertising and promotion. 8th ed.
2. Journal Articles
Journal of Marketing from American Marketing Association
Academy of Management Review
Pickton, D. and Broderick, A., (2005).Integrated Marketing Communications.
Journal of Marketing Communications
Solicitor Journal, 2013

4. Sources of Research          

Newslinks from BBC 2013
Department of Health, 2013
Office of National Statistics 2011
Official Website of BCG 2013
Data from CIPD 2013, PESTLE analysis.
Data from Housing Industry Association (HIA). 2011
Officil Site (2013) of Innocent Drinks. 2013.
News from The Telegraph. 2008

5. The Relevant Market        

The market of the UK for Innocent Drinks has faced all kinds of situations. Taking advantage to the high exposure of the company – Innocent Drinks introduced smoothies in the year 1999 and received a good response almost instantaneously. In the UK, the company is very popular with a high brand value. As a result it was comparatively easy for the company to include new products under the same banner. It even makes enough donations, as £473,000 to Age UK during 2008 to 2010 (Ball, 2011)                       

5.1 Determined UK Market            

          The first and only financial report issued officially by Innocent Drinks 2008 showed a very strong and steady growth of revenues since 2004 with an average growth rate of 50 per cent  per annum (innocent, 2008). In the years 2009 and 2010 revenues growth seemed to have eased from its sharp growth to an average of 25per cent (Zuke, 2012). The financial downturn of the world economy and world recession have slowed the performance and growth of the market. The economic climates have affected the consumer confidence and expenditure habits slightly toward value products (international market bureau, 2011). It was not only the Innocent Drinks but also other companies were affected by the economic downturn. The net profit/loss results is quite worrying because the company reported a considerable loss of £ 6m in the year 2010 followed by further loss of £9.8m in 2011 (Zuke, 2012), Co-founder Jon Wright (2012) justified the loss to be due to investment planes in Europe.  But the market has recovered from the previous situation and Innocent Drinks has registered a sale value of £213.5 million in the year 2012. The following chart shows the sales and the growth trend for the last 8 years.
Figure 4 Innocent Annual Sales Report 2005-2012
Sources: Zuke, (2012) and Wright (2013)

6. Macro Analysis                 

Macro analysis is about noting results derived from interactions about the economy and diversified resources with larger population (Ronald and Meyer, 2011).

6.1 Analysis of Industrial Popularity                

                        1.6.1.1 PESTEL Analysis     
Political Analysis: At a governmental level, one of the political challenges facing Innocent Drinks is the level of calories and sugar in their products.  Given that its 100 per cent natural there is little or no control over their ingredients, the government has targets and audit standards. Surprisingly the sugar and calories are at very close levels to soft drink such as Coca-Cola. Innocent Drinks along with 480 main brands in the UK have signed a deal with the government to curb calories and sugar in their drinks (Joseph, 2013); Public Health Minister Anna Soubry (2013) pledged to cut calories and sugar by up to 10 per cent in leading brands including Innocent Drinks.

Economic Analysis: Since 2008, the economic climates were not in favour of any company but it did not affect the sales of Innocent Drinks as compared to other companies. Instead it resulted in a bank of England reducing its borrowing cost up to 0.5% which was an opportunity for the company to raise a cheap finance to fund their expansion investments in Europe and internationally.

A major economic challenge that the company is facing is that the global commodity prices for fruits is soaring since the company launched 15 years ago. Extracting and analysing data from the Global commodity index “Mundi” it was found that the price of Banana and Orange, as they are the main components in Innocent products, the following chart is showing the trend;

Commodity Index (2013)
for example the change of price in 1998 compared to 2013 the orange price increased from 280 to 680  which is 242% increase, this is a major economic challenge where the number of people on earth and global demand is increasing much faster than the increase in supply. It is understood that this is a general challenge for all food and drinks industry however the pricing difference between natural juice and soft drinks will increase to gap year on year which will affect selling prices and eventually number of units sold and turnover, soft drinks raw materials will not face the same level of challenge.

Social Analysis: From social and environmental perspective the company has a strong and sustainable competitive advantage among rivals given that the company and brand’s core competences lie within the strong social message delivered to society across their marketing and media campaign. The picture of the brand demonstrates healthy, natural, 1 of 5 a day, environmentally friendly, never from concentrate, 100 per cent recyclable etc.

Overall the social factors are in favour of the company and will be a major growth factor if the company managed to keep control over prices to be within affordable limits. One of the challenges that the company is facing at the moment is Coca-Cola acquisition of the company and more than that including it in the happy meals for children in McDonald’s menu (Telegraph, 2007). Coca-Cola and McDonalds are perceived to be the complete opposite strategy and image which was a major social negative image to InnocentDrinks blowing away millions of pounds of advertisement and imaging cost. It seemed to have affected the trust of the company, more importantly it got the attention of the press with many writers calling it “not very innocent” (Simmon, 2007).
Technological Analysis: Getting support from technology still seems to be in a far-fetched distance. Getting connected to public through social media is yet to get well explored. The company need to get direct information about the increasing health-consciousness among the target consumers. Even in terms of advertisement, the company is hardly adding techno related equipments to the marketing campaigns. It needs to create more awareness and consciousness about the quality of consumer’s choice and the downside of soft drinks in comparison. The company’s over ambition has affected their image which is not easy to recover. Most negative implication seemed to have happened after Coca-Cola climbed the top of the hierarchy, which, in the long run, might be a threat to sustainability of the image of the product, which is the main asset the company owns. All these aspects still can be handled well if the company prefers to take support from the technologically balanced marketing tools and software.

Environmental Analysis: The company has adapted the (GCTTF) policy which helps make sure their supply chain is all environmental friendly and ethical especially with labour forces to be in compliance with international labour organization standards. The company’s donate 10% of their income to help fair trade farming thought their charity “innocent foundation” (innocent, 2008) which is a good factor to improve and sustain the image of Innocent Drinks. The company had been customizing the product to be environment friendly and 100 per cent recyclable was a good start and image influential from a marketing view, until recently in 2011 when it became 35 per cent recyclable. As a result the company had to try hard to fight for cost cut, which is a challenge that opens the door for customers who are willing to pay premium for organic products.

Legal Analysis: The company is also following some minor law cases for and against the company. For instance; a business tried to imitate the company’s name such as Innocent Vitamins (Salkeled, eccles, 2011), such cases are within the normal course of operation given that most international corporation have legal department following daily cases. None is threatening at a corporate level except one case, which is a major threat to the company, it’s a law case lost against “Deepend Fresh Recovery Limited” regarding the ownership of their trademark (solicitorjournal,2013), the company suffered a major blow being unable to provide evidences of their complete ownership of the trademark, the threatening challenge of this case is not only the ownership, it also has a third party power of control over a brand that they have been developing since 1999. More importantly it can easily affect the image of the product given that their slogan was “how to do it right”. Also the company regards itself as an ethical company producing an ethical product.


6.1.2 Porter's Analysis           
In accordance to the Porter’s Five Forces (Porter, 2008), for long term profitable sustainability in the market, it is necessary for a company to have right assessment of all those aspects that are related to the domain of industrial rivalry. In reference to Innocent Smoothies, the competitive edge needs to check the following aspects-

Threat created by New Entrants: As the market of smoothie gets popular in the UK and people prefer more health oriented drinks, the competition is increasing for Innocent Smoothies. Companies like McNeil and Ella’s Kitchen are creating issues of retaliation, sinking and switching of costs, loyalty of the customers, etc . for Innocent Smoothies in the market.
Threat created by Substitute Products: Innocent Smoothies is also facing enough competition from other products that are manufactured by Innocent Drinks. These are like kids’ apple and orange juice, and Kids’ fruity water. These products are switching the younger generation from smoothies to juices within the brand.
Customers’ Power to Bargain: Under this specification, the consumer’s ability to pressurise a company get highlighted. In case of Innocent Smoothies it shows the need to revise the price and implement loyalty programs for the customers, like ‘Buy 1 Get 1 Free’.  Sensitivity of the buyers towards price remains the core concern.
Suppliers’ Power to Bargain: The suppliers are directly related to the inputs of the market. The distribution channel of Innocent smoothies relie a lot on the suppliers and thus needs to take care of labour unions, competitiveness among the suppliers, strengths of the channel of distribution, etc.
Intensity towards Competitive Rivalry: For Innocent smoothies being aware of the increasing competition is very important. It must take care of the old competitors and at the same time keeping a keen eye upon all the new entrants in the same market or product line. Implication of powerful strategies and significant transparency within the firm are additional elements ot be added to meet the competitive hurdles.
6.1.3 Competitive Edge
Innocent Drinks was the first to present the Smoothie Juice in the United Kingdom as a specialized brand, therefore has the “first mover advantage”, since its launch. It has maintained a superior relationship with the customers through a consistent appearance and style, product design, package, appearance and price that suited the positioning of the product as a high quality healthy product and made it difficult for new market entrants to compete. Innocent held a leading position in the market and succeeded to expand the market from very niche limited market into a significant one. The company has successfully increased its market share from 35 per cent in 2005 to 79 per cent in 2013 (Kantar, 2013). The brand “innocent” was valued at £320m early in 2013 when Coca-Cola acquired a stake of the brand (Evans, 2013). The brand has a clear purpose; a 100% natural 100% healthy made from fresh squeezed fruits without any additives. The design, look, price and image helped in delivering and positioning the brand across the customers successfully. The company’s contribution in bringing health awareness among the audience helped in expanding the market rapidly. The brand gained its trust thought consistency and meeting consumer’s expectation with quality.
The brand has always been supported by a generous advertisement budget; the company spent about £16m in advertisement in 5 years which is 80% of the overall advertising spending of the industry. The graph below shows the marketing spending compared to its competitors.
Figure 5 Marketing Budget- 2006-11 (in millions)
Source: KeyNote (2012)
Thus, quality of the product relies on advertisement and publicity, as against basic products that peruse cost leadership strategy. In the words of Reed (Sibun, 2008),
"We're going in with a promise of taste, quality and ethics, while Pepsi is about cheaper prices...It gives us an opportunity to dramatically widen the demographics of the brand. A litre of smoothie is £2.99, a litre of orange juice will be £1.89. People can buy into the Innocent ideals at a lower price point."

It can be well noted from the figures that the product cycle is heading toward maturity; therefore advertising budget will gradually decrease however it is wise to keep it at high level as a competitive advantage and to prevent new competitors to enter the market. The following graph shows the decrease in marketing budget for each competitor

Figure
6. Comparative status of Competitive Brands (in millions)
Source: KeyNote (2012)
Given that innocent is the dominant in the market it will always be the most able by far to spend on advertisement to keep enjoying the competitive advantage.     
           
.6.1.4 Primary Competitors   
Status of Pepsico: The competition of Pepsico with Innocent Drink is like a competition of a SME with an International giant. With coverage over 200 countries with a developed annual profit margin of $43.3 billion revenues in the year 2012, is a definite challenge for Innocent drinks (York, 2012). However, the essence of credibility in Innocent seems to give this giant enough space for competition.

Status of McNeil: There are tugs between Innocent Smoothies and McNeil Nutritionals in terms of offering the healthiest options to the consumers. In most cases people prefer both a thee companies offer different kinds of products. Mc Neil gives competition to Innocent by its selected range of products like, Viactiv, Lactaid and branded sucralose sweetener that is named as Splenda. Further there is the addition of monk that is fruit-based sweetener named as Nectresse and is making the market for Innocent smoothie more stricted (Adams, 2012).  

Status of Ella’s Kitchen: The entrants of Ella’s Kitchen in 2006, created the competitive threat of being organic in the process of manufacturing. Since Ella’s Kitchen is comparatively new and smaller than Innocent Smoothies, it created the competitive niche of offering quality organic products against more justified price. The company acquired 20% share of entire baby food domain of the UK and attained a wide ranged global turnover of estimated revenue of $100m in the year 2011 (Loveless, 2011).

Status of Boost Juice: With its international presence in the countries of Europe, Asia, Russia and Middle East, Boost Juice is much supported by Nestle (Easier, 2007). It turned extensively competitive to Innocent Smoothies as in the year 2008 NestlĂ© launched its fruit smoothies in collaboration with Boost Juice Bars. It was a head on fight for marketing space and gave Innocent Smoothies enough competitive edge.   

7. Micro Analysis      
Micro analysis is about smallest units of analysing aspects of social sciences in relation with the individual and the possible social setting where he lives (Ronald and Meyer, 2011).    

7.1 About Innocent Smoothies                

The basic brand image of Innocent smoothies relies over its demands related to validity, authenticity and most importantly the matter of being genuine. Anyone can pick up any label from the products of Innocent Smoothie and can check the following unique declarations- 

  
Further, there is the instance of double-dip crises had a remarkable effect on turnover as showed in the chart below; the effect is more obvious in the Smoothies meaning the better quality, the more expensive, the more sensitive to income and crises.

Figure 7 Comparative Consumption of Juice and Smoothies in the UK
Source: Zenith International, 2013

8. Selection of Scopes and Strategies                          

            1.8.1 New Developments in Innocent Smoothies         

            Innocent’s is adopting differentiation strategy and core competences and the competitive advantage comes mainly from three dimensions: Innocent Brand and Character, Consumer health consciousness given the healthiest product in the market, and the quality of the product. Given that the brand and health consciousness are the two main reasons, the conclusion is that marketing campaigns and annual substantial marketing budget is the sustainable competitive advantage of the company that will ensure that the Innocent Drinks always be the market dominant and expand the sector further.

8.2 Current Marketing Strategies

The company has been incurring loss in the last two years which has affected  their advertisement budget, inflation in raw material prices reflecting in their the product price to be overly expensive. The law case lost for “Deepend Fresh Recovery Limited” is affecting the image of the company and should be closed very quickly.

8.3 Goals of Product-line

          As Innocent is well experienced in creating the Smoothies market, the objectiveis to create a new unique and totally differentiated product and create a totally new market for it. The product is called “Super Smoothies”with super food 100% natural ingredients, the base product is the Acai Berry Smoothie made from Acai Fruit is a Brazilian Berry fruit, The idea of this product is that it is not only Smoothie, it’s a new different type of Smoothie with super food, an antioxidant product which lower the risk of heart and cancer diseases, it also reduce blood pressure and is a very effective anti-aging nutrition. It will also help reduce weight for diet programs, the notion of “Super Smoothie” contrary to “Smoothie” as a new product line.

8.4 Goals of Marketing    

To launch “Super Smoothies” in bottles of 250ml as a starting point. Targeting professionals at age range of 25 to 45 in the United Kingdom, starting from Greater London and south areas.The product will group the benefits of the super food and the Acai-Berry Smoothie as a special product and will be available in all selling points and stores.

           

***



References (newly added)

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Admin (2012) Copywriting with Personality, as taught by Innocent Drinks. Official Blog.Advertising Reg. Innocent Drinks. March 10, 2012  http://www.advertisinggreg.co.uk/copywriting-with-personality-as-taught-by-innocent-drinks/ [Retrieved on 25th Dec. 2013]
Ansoff, I. H. (2006) The Secrets of Strategic Management:: The Ansoffian Approach. BookSurge Publishing
Ball, J. (2011) Innocent smoothie maker says charity cash bottled for best interest rate.The Guardian, Thursday 26 May 2011. http://www.theguardian.com/uk/2011/may/26/innocent-smoothies-charity-cash [Retrieved on 25th Dec. 2013]
BBC (2009) "Coke buys into Innocent smoothies". BBC News. 7 April 2009. http://news.bbc.co.uk/2/hi/uk_news/7986901.stm [Retrieved on 24th Dec. 2013]
BCG (2013) About BCG. The Boston Consulting Group. http://www.bcg.com/about_bcg/history/history_1968.aspx [Retrieved on 25th Dec. 2013]
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