Customers were highly satisfied with the products as well as their eco-friendly image. The company had employed latest packing technology o give its products maximum shelf life. Also, all products launched by the company were in their growth phase of the life-cycle. Effective distribution channel of the company has also been one of the strongest factors contributing to its growth. The company had followed a unique advertising strategy by writing on back of the products. This had greatly minimized the advertising expenses. Weakness: The major weakness of Innocent Drinks from its initial days was high costs of production and logistics supply.
The company had always charged premium pricing for its products, which had constrained the market to some extent. Opportunities: One of the major factors that had attributed to growth of the company in its initial years was high market opportunity in the fruit smoothies market. The support of the government regarding promotion of healthy fruit drinks had also enhanced opportunities of the business. Threats: The biggest rival of Innocent Drinks till 2005 was P&J Smoothies. There were about fourteen companies operating in the market when Innocent Drinks was established.
The competition was fierce as all brands were competing with one another so as to gain maximum market share. Strategy from 2006 The year 2005 had been very critical for Innocent Drinks because this was when PepsiCo had decided to enter the smoothies market by purchasing the second largest market player, P&J Smoothies. Since then, competition for Innocent Drinks had become very tough as PepsiCo provided P&J with operational advantages owing to its global scale of operation. Porter’s Generic Strategies can be a useful guide to understand the business strategy that had been adopted by organization to gain competitive advantage over its rivals.
Among three generic strategies, namely cost leadership, product differentiation and focus or segmentation, the strategy adopted by Innocent Drinks can be classified as product differentiation (Porter, 2011)). This is because the company had constantly introduced product innovation and formulated new products (Jones, 2008). The company had introduced products to target the adult population when they had realized that this population constitute a potential market. Introduction of Veg Pots had also been one of the moves made by the company in order to increase market share.
The company had expected that introduction of new products for customers will help to enhance its market share (Schmidt, 2010).
Please type your essay title, choose your document type, enter your email and we send you essay samples