Energy Drinks Market in Denmark

Table of Contents 1. Introduction3 1. 1 Problem exposition3 1. 2 Problem Statement3 1. 2. 1 What is the pickence of customers between cauterize and ruby dickhead? 3 1. 2. 2 How should suntan crossings be actual and how should they be equipment casualtyd? 3 1. 2. 3 How should Coca-cola Denmark promote and emit conflag judge? 3 1. 3 Definitions3 1. 3. 1 muscularity suck up3 1. 3. 2 blaze up muscularity crisp4 1. 3. 3 cherry-red counterfeit nil crisp4 1. 4 Demarcations (Scope and limitation of the study)4 2 hypothetical Background4 2. 1 Market segmentation5 2. 2 Competitive Benchmark analytic thinking5 2. 3 merchandise Mix (4 Ps)5 3 Methodology Description5 . 1 Research Design5 3. 2 primordial and secondary education battle array5 3. 3 Qualitative information collection6 3. 4 valued data collection6 4 Presentation and epitome of data6 4. 1 Market sectionalization of naught crapulences6 4. 1. 1 abstract of Focused convocation audience6 4. 1. 2 Analysis of Online questionnaire survey7 4. 2 opponent Benchmark ( swerve and exit pig)10 4. 2. 1 Analysis of Focused separate interview10 4. 2. 2 Analysis of Online questionnaire survey11 5 Findings and summary of the analytic thinking13 6 Recomm closing curtainations14 6. 1 Product14 6. 2 Price14 6. 3 Place14 6. 4 Promotion14 7 termination15 References16 9 Appendices17 1. Introduction danish pastry soft soak ups sales vex recorded positive volume growth in recent eld. unafraid volume growth was recorded in capacity crapulences sales attributed to the matched foodstuff parting and new ingathering launches. Some of the major players in the danish force drink market argon bring down and release diddlyshit. Accordingly, the of import aim of this report allow be to i dentify and analyze the come-at-able ways for Burn heartiness drink fruit to vie with the initiation famous push drink red ink diddly which has recently entered into danish pastry brawn drink marke t in 2009. . 1 Problem Description In 2009, the Danish Veterinary and Food Administration approved the join on of caffeine level in animation drink. This has wedded a wide-open-door for drink companies to rise up in this segment. Taking advant hop on of this opportunity, personnel casualty bull the benas to the higher(prenominal)est degree famous qualification drink bon ton, started to get by at bottom the Danish postal code drink market. On the new(prenominal) hand, Coca-cola Denmark withal considered it as an opportunity to further develop product chain of its animation drink Burn.In Denmark, Burn has been dominating the vigor drink market so utmost but now with the entry of redness fudge into the market it entrust now put one across to strategically develop its marketing coalesce to find a better way to compete with fierce talk through ones hat and chief(prenominal)tain its dominant position. 1. 2 Problem Statement We define the worry question for our query as follows How could Burn compete with bolshie son of a bitch on the Danish capacity drink market? To support main question we take formulated some sub questions. They are as follows 1. 2. 1 What is the orientation of customers between Burn and florid Bull? . 2. 2 How should Burn products be genuine and how should they be priced? 1. 2. 3 How should Coca-cola Denmark promote and distribute Burn? 1. 3 Definitions 1. 3. 1 Energy drink Energy drink can be defined as a drink or the bever suppurate that contains higher doses of caffeine and other stimulating agents that give you hour energy. The doses of the caffeine and the stimulants are legally approved by the government wellness authorities. The main purpose of drinking an Energy drink is to get an flash bulb energy to your body. 1. 3. 2 Burn energy drinkBurn Energy Drink is a functional beverage, motleytureture of 14 ingredients that come in a 16 ounce can and is available at nigh e real grocery store or conven ience store across Denmark. It is one of the products of Coca- skunk Company. 1. 3. 3 rosy-cheeked Bull energy drink Red Bull Energy Drink is a functional beverage, specially developed for periods of increased mental and physical exertion. It can be drunk in virtually any situation during sports, at work, whilst driving and during leisure activities. 1. 4 Demarcations (Scope and limitation of the study) As e truly report has its limitations, this report is also undefendable to versatile limitations.This report is ground on ii products, Burn and Red Bull which are the products of The Coca-Cola Company and The Red Bull Company respectively. These devil companies shake various product categories however this report will be thinked alone on those dickens products among wide course of study of energy drink in energy drink vault of heaven. As far as the market place is concerned, this report is limited to the Danish market. Most of the use uprs of energy drinks in Danish mar ket are in the first place the younger large number aged 18-25. Considering this feature we have selected this age chemical group as our level group. 2 Theoretical BackgroundThis section of the report helps to provide the massive theoretical framework used for interpreting the research presented in this report. conglomerate marketing theories have been applied as a background in this report. Theory of Market segmentation is used to analyze Burn and Red Bull in the Danish Market. To analyze the competition between Burn and Red Bull, Competitor Benchmark Analysis is used. Finally Using the surmise of merchandise Mix (4 Ps), recommendation to Burn has been made to success to the full develop its marketing play so that it can increase its sales and compete with Red Bull. 2. 1 Market segmentationMarket segmentation will be identified by fetching into consideration the demographic variables ( same(p) gender, incompatible age group and life style) and geographical reparations (various cities of Denmark) like Center of Copenhagen, Sj? lland, Fyn and battle of Jutland 2. 2 Competitive Benchmark Analysis Competitive benchmark of Burn will be made with its direct competitor, Red Bull. For this we will draw various eventors which are flavor, predilection, check off, price, place ( cheery to spoil), furtherance and effectiveness of the products. During our group p sphereing these factors came up as the most relevant criteria for devising competitive benchmark.Accordingly, respondents were asked to rate and evaluate both Burn and Red Bull on those factors during the online survey. 2. 3 Marketing Mix (4 Ps) Marketing Mix i. e. 4 Ps will be taken as theoretical base for providing recommendation to Burn after the analysis of data and findings are presented. Accordingly, Product, Price, Place and Promotion schema will be presented in order for Burn to successfully compete against its rival Red Bull. Then after, the conclusion will be made. 3 Methodology De scription This section of the report gives information intimately the stages that we went finished period doing the research and writing the report. 3. Research Design We chose exploratory role as our research design. We have a research problem which is unstructured. We do non have enough information ab issue our topic for which we have to investigate much on our topic. Both Qualitative and quantitative data collection methods are used. To gain more and more information and insights most the problem topic, Qualitative research design was elect. Using qualitative data collection method, it became easier for us to change translate and reformulate our unstructured questions. decimal method is also used in order to check the inclemency of the results confineed from qualitative method.For quantitative data collection we tried to get as many respondents as possible who can represent the total world. 3. 2 Primary and secondary data collection For this research we have chosen bot h Qualitative and Quantitative data collection method for primary winding data. Similarly, wherever required, we have also used secondary data from the articles, publications and website of the company as well as blogs and other relevant news articles. 3. 3 Qualitative data collection To collect the qualitative data, a focus group interview was conducted. We prepared the interview guide for the focus group which is attached in the appendix.The focus group contained 11 members who are the students from second semester class at Niels Brock. After the completion of interview process we also took a subterfuge test among the focus group interview participants confident(p) 15 other students. Students were chosen randomly. Each of them were given to drink two glasses, one filled with Burn and another filled with Red Bull and were asked which one they like and how they try. The responses from the participants were used for the analysis. 3. 4 Quantitative data collection To collect quanti tative data, we prepared structured questionnaire. It consisted of 15 questions (open and closed cease questions).We posted our research questionnaire in the Facebook blogs and invited 600 Facebook users through simple random method. We got only 116 responses and of which only 77 respondents answered all questions of questionnaire. So in this research 77 respondents are our total number of observation. In other words our assay size is 77 which represent the total population of energy drink customers in Denmark. 4 Presentation and analysis of data The presentation and analysis of data has been categorized as Market segmentation and Competitor Benchmark. 4. 1 Market Segmentation of energy drinks 4. 1. 1 Analysis of Focused group interviewDuring the focused group interview, 11 participants were asked well-nigh the manipulation of energy drink ein truth week. Among the participants, 1 participant removes 5 or more cans per week. 4 respondents belt down 3 to 4 cans and 1-2 cans as well. Whereas, 2 respondents consume less than 1 can of energy drink. Thus their consumption function is around 1-4 cans per week. When there was a discussion to the highest degree the occasions during which they consume the energy drink, most of the answers was during workout, training or going to sports and when mixing with inebriant. thither was also a discussion about having coffee instead of energy drink when one is tired. participants verbalise that they prefer coffee whereas others preferable energy drink. Regarding price, most of the respondents voted for cheaper one, less than 20 DKK and between15-17 DKK. 4. 1. 2 Analysis of Online questionnaire survey The willingness of various age groups towards energy drink is illustrated in the diagram below. It shows that 56% of respondents from age group 18 to 25 old age are interested in energy drink. Figure 1 Willingness of various age-groups towards energy drink first auxiliary 4 Similarly, 20% of respondents from the age group below 18 and 26-35 years age group showed their interest in energy drink. and only 4% of the elderly respondents are interested in energy drink. Thus, it can be seen that the highest number of people from the age group 18-25 years are interested in the energy drink. Figure 2 Willingness towards energy drink by gender Source adjunct 5 The in a higher place figure shows that 68% of young-beacquiring(prenominal) population is interested in energy drink whereas only 32% of young-bearing(prenominal) population is interested in Energy drink. Figure 3 Willingness towards energy drink by location Source concomitant 6 According to the above figure, most of the respondents from midway of Copenhagen are interested in energy drink. 8% respondents from the Copenhagen region and 32% respondents from Sj? land region showed interest in energy drink. While analysisng the age wise consumption of energy drink which is illustrated in the figure below it has been seen that the data is bit c onflicting. Figure 4 Age wise consumption of energy drink Source Appendix 7 As shown by the diagram, those who almost never drink energy drinks are higher in age group 18 to 25 years. But again, those drinking from 1-2 cans per week are also higher number in age category 18-25 years but less ompared to those who never drink. But what can be cogitate that those who drinks energy drinks they normally consume 12 cans per week and are higher in 18-25 years category. Analyzing the preferred occasions when customers usually like to drink energy drink, the research show that customers usually prefer it to mix with alcohol as their first preference and then drinking when they are tired. Figure 5 Occasional preference of Energy Drink by gender Source Appendix 8 The above graph shows most of both females and males consume energy drink when they mix with alcohol. 2 females out of 35 female respondents (63%) and 19 males out of 42 male respondents (45%) tell they consume it when they mix with alcohol. Similarly 43% of female and 40 % of male respondents answered that they take energy drink when they are tired. Likewise, 11% female and 33% male verbalize that they take it when they go to sports. 14% of female and 21% of male chose energy drink when they are thirsty and 6% of female and 7% of male chose for other occasions. Figure 6 Customers willingness to pay for the energy drink Source Appendix 9Relating to the price it can be clearly seen from the figure above that 18-25 years age group which is the intent customers for energy drinks are willing to pay 16-20 DKK for the energy drinks where as 26-35 years age group are willing to pay 10-15 DKK for the drink. 4. 2 Competitor Benchmark (Burn and Red Bull) 4. 2. 1 Analysis of Focused group interview During the focused group interview, 8 out of 11 participants preferred Red Bull. Only 3 preferred Burn. When there was a discussion of product features like seek, flavor and effectiveness of the products participants say t hat effectiveness of the product is heavy.During the blind test 26 participants were made to taste both Burn and Red Bull drinks blindfolded. Table 1 taste sensation of product by taste sensation without get alonging the product (Blind Test) BurnRed BullBoth Total no. of participant (26)9152 The research showed that Red Bull was highly preferred by the participants with 58% appreciating the taste of Red Bull. Burn was preferred by only 35% of the participants. 4. 2. 2 Analysis of Online questionnaire survey The illustration of various measures to which the consumer gave importance when get energy drink is shown in the figure below. Figure 7 Customers emphasis when purchase energy drinkSource Appendix 10 We found data of customers consort to the importance they give to various measures or elements when they want to acquire an energy drink. The above graph shows that 53% of the total respondents said flavor is really important when they buy energy drink. About taste, 60% said it is very(prenominal) important. None of the respondents said that it is not important at all. Talking about brand, only 19% said very important, 34% said important, 30% said not so important and 17% said not important at all. About price, 51 %( more than half population) said that it is very important.Only 5% said not so important and no respondents said that it is not important at all. So far as convenient place to buy is concerned, 29% said very important, 54% said important. When packaging is concerned 16% said very important, 29% said important 39% said not so important and 16% said not important at all. When it is about effectiveness, 44% said it is very important, 38% said important. Thus the analysis shows that flavor, taste, price, convenient buying options and effectiveness of the drinks are important for customers where as brand and packaging are not that important in buying decision. found on the various factors to which the consumers give preference when buying ener gy drinks, proportional analysis between Burn and Red Bull has been carried out. This can be described from the figure given below. We asked the respondents to evaluate Burn and Red Bull giving them 4 options (Very nigh, Good, Bad, Very Bad). But here in the analysis we have taken only two options as we think these two options are sufficient for comparative analysis. Figure 8 Comparison of Burn and Red Bull based on the various factors Source Appendix 11 The above figure shows the customers preference between Burn and Red Bull on he various factors which are important for their buying decision. 34% of the total respondents said the flavor of Burn is mature and 23% said very safe trance 48% and 29% said the flavor of Red Bull is good and very good respectively. Similarly, 39% and 13% of the total respondents said the taste of Burn is good and very good respectively magic spell 52% and 29% respectively chose good and very good for the taste of Red Bull. As far as brand is consid ered, 39% and 26% said the Burn brand is good and very good respectively while 42% and 45% said Red Bull brand is good and very good respectively.When it is about price, 27% and 12% chose good and very good for Burn while 16% and 12% for Red Bull. 35% and 23% of total population said Burn is good and very good respectively when considering convenient to buy whereas for Red Bull it is 38% and 17% respectively. About packaging 36% and 22% answered good and very good for Burn while for Red Bull its 45% and 18%. Finally for the effectiveness of the product, 39% and 18% respectively chose good and very good for Burn while it is 45% and 25% for Red Bull.Thus the analysis shows that customers highly prefer Red Bull while relating to flavor, taste, and brand. On the other hand, with relating to price, convenient to buy and nice packaging, customers seemed to prefer Burn. So far as the effectiveness is concerned, Preference towards Red Bull is high but the difference is not so much. 5 Findin gs and summary of the analysis According to the analysis presented above, it can be seen that the energy drink market segmentation is more hard on the costumers between age group of 18-25 and that the customers are dominantly male rather than female. sounding at the geographic distribution the market segment is undoubtedly concentrated on Copenhagen with to some extent also in Sj? land. However, the other fact is also that since Copenhagen is the largest city with dense population this result is quite obvious. The other important findings of the study regarding the life style of the customers relating to the consumption of energy drinks is that energy drinks are excessively consumed as a mix in alcohol and then it is consumed while people get tired. Also energy drinks are a lot consumed just 1 or 2 cans per week. Normally customers are willing to pay 16-20 DKK for the drink.The analysis shows that in general the customers give high importance to the flavor, taste, price, effective ness and buying convenience while making their buying decisions of energy drinks and that the brand and packaging are not of importance for the customers. keeping this in mind the competitor benchmark of Burn and Red Bull Red Bull clearly shows that though Red Bull cosmos a new entrant in the Danish market it has succeeded in taking good share of energy drink market in Denmark. Red Bull is preferred by customers in terms of its flavor, taste which are important factor in general for customers while making their buying decisions.Similarly, with the effectiveness as well Red Bull is preferred by customers in comparison to Burn. Burn is preferred by customers in packaging which not of important factor for customers. But Burn quiet down dominate Red Bull in terms of its easy availableness at stores which is due to the fact that it is distributed by Carlsberg Brewery which is considered to have a very immobile distribution channel in Danish market. (footnote) Again at price Burn is r ated better owing to the fact that they are cheaper than Red Bull. Of course with the brand Red Bull is rated much better as it is an internationally recognize brand. Recommendations Based on above findings following recommendations have been suggested for Burn to improve its products, promotion and pricing strategy. The recommendations will be based on the marketing mix (4 Ps) which is product, price, place and promotion. 6. 1 Product Since the research findings show that Red Bull has dominant preference by customers in terms of flavor, taste and effectiveness, therefore Burn has to come up with modern product developing in order to provide added value to its product so that customers preferences divert towards Burn.Therefore, considerable amount of resources and time should be washed-out on research and development of variety of flavors and appealing taste with its product. Since the market segment of the energy drink is mostly 18-25 years old and that they consume it as mix i n alcohol so the taste preference of these age group should be taken into consideration and the flavor and taste should be developed which is appealing while mixing with alcohol as well. 6. 2 Price Relating to the price, Burn is cheaper that Red Bull and realizing the fact that Red Bull is gaining market share it is wise to maintain its low price strategy. . 3 Place The research show Burn with strong localisation but since strong distribution channel is its one of core competencies it has to fully utilize this competences to move ahead form Red Bull to place its products at all the convenient stores. The major priority should be given to Copenhagen since its the main market segment but again taking advantage of its well managed distribution channel it should also focus on other cities where Red Bull are not able to reach due to lack of experience with the Danish market. . 4 Promotion A well planned advertising strategy should be developed mainly targeting on the 18-25 years age gro up and again the male customers who are the major customers of energy drinks. Though Red Bull is world recognized brand, Burn also has its brand reputation as it is a product of world class Coca Cola Company. Thus advertising campaign should also be focused to create awareness of the Coca Cola brand among the customers while promoting Burn which can positively influence customers choice. Conclusion Based on the research analysis and findings, it can be concluded that within the Danish energy drinks market Burn is definitely getting a tough competition from Red Bull despite the fact the Red Bull is a new entrant in Danish market. Its global brand recognition has provided Red Bull with competitive personnel which can be a serious threat to Burn in coming future. Therefore it is a must for Burn to take well timed(p) action and initiate necessary marketing strategies to compete with Red Bull.Burn has low price advantage as well as strong distribution channel which provide Burn with an edge in the competitive market and therefore it needs to look more into product development and promotion strategy in order to compete with Red Bull and thus gain success in the competitive energy drink market. 8 References Books David Jobber. (2007). Principles and Practice of Marketing. UK. McGraw-Hill fostering Pervez GH, Kjell Gr. (2005). Research Methods in Business Studies. UK. Pearson Education Bryman, A. and Bell, E. (2007). Business Research Methods. 2nd Ed. UK.Oxford University Press Burns, A. C. and Bush, R. F. (2006) Marketing Research, 5th ed. , prentice Hall Kotler, P. and Keller, K. L. (2006) Marketing Management, 12th ed. , Prentice Hall Svend Hollensen, (2007) Global Marketing a decision-oriented approach, Websites http//www. euromonitor. com/Soft_Drinks_in_Denmark http//advantageaustria. org/dk/news/local/Red-Bull-und-Shark. en. jsp http//www. aeofooddrink. com/34. php http//www. dietspotlight. com/burn-energy-drink-review/ http//www. redbull. com/cs/Satellite/ en_INT/Products/Red-Bull-Energy-Drink-021242751115866? =1242745950125/product-FAQ 9 Appendices Appendix 1 Questionnaire Dear respondents, we make this survey in order to obtain more comprehensive knowledge about the energy drink sector in Denmark, particularly the two big brands Burn and RedBull. So we would highly appreciate if you spend a few minutes answering our questionnaire. Your information will be treated anonymously 1. How interested are you in energy drinks? oVery interested oInterested oNot very interested oNot intererested at all 2. How often do you drink energy drinks? oAlmost never oFrom 1 2 cans per week From 2-5 cans per week oMore than 5 cans per week 3. ON WHAT OCCASIONS DO YOU make whoopie ENERGY DRINKS? oWhen Im tired oWhen Im thirsty oWhen I go to sports oWhen I mix with alcohol oOther (please specify in the box below) 4. Where do you often buy energy drinks? oIn the super markets oIn the bars oIn Seven Eleven oIn small shops (eg heavy weapon station, kiosk e tc) oOther (please specify in the box) 5. How much would you like to pay for an energy drink? o10 15 Kr o16 20 Kr o21 25 Kr oMore than 25 Kr 6. How important are the following factors when you buy energy drinks?Very important Important Not so important not important at all Good flavor Good taste Good brand Reasonable price Convenient to buy comme il faut packaging The effectiveness of the drinks 7. Which of these brands do you know? oBurn oRed Bull oNone of them 8. Which one of these brands do you prefer? oBurn oRed Bull oNone of them 9. How do you evaluate RED BULL in the following factors? Very goodGoodNot good-not badBad Very bad Brand thwack piquance Price Convenient to buy Packaging Effectiveness 10. Do you have any recommendations for RED BULL to better meet your satisfaction? I dont know oIm already very satisfied oI would recommend as follows 11. How do you evaluate BURN in the following factors? Very good Good Not good-not bad Bad Very bad Brand Taste Flavor Price Con venient to buy Packaging Effectiveness 12. Do you have any recommendations for BURN to better meet your satisfaction? oI dont know oIm already very satisfied oI would recommend as follows 13. What is your age? oYounger than 18 years old oFrom 18 25 years old oFrom 26 35 years old 14. What is your gender? oMale oFemale 15.Which part of Denmark do you lodge in? oCenter of Copenhagen oSj? lland oFyn oJylland Appendix 2 Interview guide for focus group What criteria do people choose when they buy energy drink products? ar different flavors important? What occasion do they drink energy drink? Eg when theyre tired, or mix with strong alcohol, etc. What product name(s) do they like? Why? Do they know Burn/Red Bull? Where do they buy? Do they like Burn/Red Bull products? How much should a can of energy drink cost? Appendix 3 Fokus gruppe analyse 2. Semester klasse Niels Brock Lien, Niraj, Silas og MichelleMarket research Alle kender begge 11 deltager 8 ud af 11 kan lide red bull Dog vist e det at 6 ud af 11 faktisk kun valgte Red Bull efter blinde smagning Smagen er bedre, burn er for sodt. (inden smagning af begge m? rker) Hvor mange energidrinks drikker du per uge? 1 drikker 4-5 cans a week 4 3-4 cans 4 1-2 cans 2 mindre end 1 Hvornar drikker du energidrinks? Sprut, tr? ning, Det er meget i forhold til det at man drikker alkohol. Enighed blandt minimum 8 af deltagerne Dog drikker mange det ogsa hvis de er tr? tte eller skal til tr? ning efter en lang dag i skole.Kaffe frem for energi drink hvis man kan lide det hvis man er tr? t og skal videre, dette mener 6 ud af 11 af deltagerne hvor de andre ikke kan lide kaffe eller mener at en energi drik er bedre Hvor meget vil du betale for en energidrink? Ikke mere end 20kr, mellem15-17kr ca er de fleste villige til at betale Men ville kobe den billigste hvis de stod mod hinanden pa hylden i super marked. Energien er mere vigtig end smagen. Irriterende reklamer for meget nogenhed provokerende reklamer mener 2 af delta gerne, Red Bull promoverer ikke sadan (I Dk hvert fald)