Crystal Pepsi: A Giant’s Failure Essay

IntroductionWe tot completelyy have heard and seen it over and over again in mercantiles, movies, documentaries, stories, closely Pepsi and its huge line of proceedss. But very few of us ( nationally and internationally) study along about the association and its history. PepsiCo, Inc. was established by the merger of Pepsi-Cola and Frito-Lay. Pepsi-Cola was created in the bracing-fangled 1890s by Caleb Bradham while Frito-Lay Inc. was formed by the 1961 merger of the Frito Comp any(prenominal), founded by Elmer Doolin in 1932. Throughout its history, PepsiCo has introduced number of harvest-feasts for its consumers from cola to water, to teas and dark chocolate mocha. It went through number of transformation and acquired several(prenominal) other companies along its way. Today, Pepsi is one of the largest regimen and swallow companies in the world operating nationally and internationally1. However, it has seen umpteen ill lucks on its way to success. whizz of its fail ures is crystallisation Pepsi, introduced in April 1992 as a colorless drink with a food market place slogan Youve never seen a judgment worry this2. The main dodging was to introduce its colorless drink with few sweeteners to its health assured consumers. The marketing began in 1990s and was tested in Denver, Sacramento, Dallas and Providence that egressed positive3. The paper discusses about its making, marketing mix, butt market, competition and failure in detail. ProductEvery big business whether it is retail, manufacture or ser immorality dep finales on some kind of a produce or product line its introduced. A proper strategy is require to fetch in market especially when competition is tough and contest is continuously coming up with some strategy to get the outset base movers advantage. Products that lack continuous innovation often suffers up to the extent that the privileged or external forces eventually drive them out of business. lechatelierite Pepsi is such product that gained the attention of consumers by its fancy realize notwithstanding mixed-up the market in no m due to its lack of innovation. Although, PepsiCo try concentrated to sustain its beloved product by introducing it in provender and divers(prenominal) flavors moreover all strategies failed miserably.4 The making crystal Pepsi by Pepsi was beginning introduced in 1992 and remained a mystery not only for its consumers but worrywise to its manufacturers in call of sales, strategy and market piece of ground. It was one of the most transfixed drinks when introduced as it was a colorless cola that provides relief from thirst and has health benefits simultaneously. The idea, however, was captured from the remake of Ivory Soap from its classic milky solution. There were dickens reasons behind the launch of lechatelierite Pepsi contest and a shift of consumer gustatory modality towards healthier beverages5. watch glass Pepsi purposeed the market righ t but failed in some(prenominal) as the drink was nothing but a combination scribble and water with little flavor in it. TasteIt was branch marketed as the caffeine free, naturally flavored with preservatives drink that is different from other colas in many ways as it uses few sweeteners, equating as clearness with virtuousness and health. The drink also claimed to be lighter than other drinks and Pepsi itself. Moreover, the drink was consequently introduced in lime flavor as fountainhead which was a get going of moderate edition and sales promotion. PepsiCo try to save its product by adding citrus flavor to it. The company also shorten its name to quartz glass and added from the makers of Pepsi on the packaging to give it a natural brand see to it and changed formula but failed again. As the sales went down drastically all major(ip) projects related to Crystal Pepsi were put to halt that resulted in its dis appearance from the shelves and discontinued supplies6. Packag ingAfter receiving the positive response from its test market, PepsiCo discrete to launch the product in United States and Canada to gain the maximum market share. A large c deoxyadenosine monophosphateaign was launched and it was the first age in the companys history a first photo-realistic, computer generated bus finish off was invented to advertise the product. The bottles were designed in the most sophisticated packing with a combination of blue, red, and silver prominent colors giving it a invigorated looks. It was also available in different sizes from 2 liters bottles to 250 ml cans7. promotionThe promotion strategy is one of the most significant parts of business. unrivaled of the best quotes about the importance of advertising is by Stuart Henderson Britt and goes like this Doing business without advertising is like winking at a misfire in the dark. You know what you are doing but nobody else does. Obviously, like any other strategy promotion strategy consist of i ntroduction, growth, maturity and correct but Crystal Pepsi is among those products that came in the market with a bang but suffered terribly since afterward. AdvertisingCrystal Pepsi started it full marketing c adenosine monophosphateaign in 1992 nationally including media c vitamin Aaign featuring Van Halen music, Right Now. This gave boost to sales in the market for a short period of time but went down again due to its competition with its rival Coca Cola. The ad also appeared in on network TV during Super wheel XXVII on January 31st, 1993. PepsiCo has continuously been famous for its promotion and the time and notes company spend on its every product line. PepsiCo was doing all it could to sustain the product in the market by using different electronic media resources available at that time. Promoting Crystal Pepsi through advertisements on buses and on merchandizes like pool float, glass and wall clock were few of its marketing strategies to make better the sales. Like m any other companies, Pepsi also arranged promotions with major retailers like Walmart but it didnt ended well. The other promoting methods that used were radio commercials and major newspapers including regular army Today. The major factor that Pepsi was unable to recognize at the time of promotion was the speciality. It worried on the importance of product attributes like fewer sweeteners, less calories, flavored drink etc. when the time was to segregate itself from well-ordered carbonate drink to more of an energy drink. Changing names, color of the packaging and commercial medium wasted time and money of the company that ultimately result in the failure of the product8. PriceThe price strategy is crucial in any decision making process. Often times products that are new in market are either valued too high or too low. For any company that has vast experience in guest relationship and dealing, pricing strategy is of greatest importance. The price of its product should consult the quality of the product as well as the re execute of consumers. If the price is set too low then the customers would reject the product and vice versa. In any case the strategy for Crystal Pepsi was the same to pass around. set StrategyAccording to various sources, Crystal Pepsi was sold at reparation cola prices which means no major efforts were put forth to follow out the selling of the product at higher prices. Crystal Pepsi at first gained a lot of attention from the other soda drinkers and they lined up to try this new refreshed cola that promotes healthy drink and fewer sweetener. The sales were skyrocketed and company do more than expected emoluments. However, the customers found no difference between sprite and 7up and eventually gave up on Crystal Pepsi. The price never went down but instead changes were made on its appearance to gain attention through attraction9. Consumers ReactionThe pricing was not the issue in the case of the cola. Crystal Pepsi was selli ng right-hand(a) at the submiting price varying from 89 cents to a dollar mark in 90s. When the cola was disappeared from the market it was due to its taste and by the end of its time period, the cola befuddled major part of its organize market. Today, Crystal Pepsi is windlessness available on websites such as eBay and Amazon where the ask prices vary from $50 to $10010. Lately, few videos were made by students at several universities on YouTube asking Pepsi to bring back Crystal Pepsi again. The future of Crystal Pepsi, however, is still unknown. Pepsi has tried many times to bring back Crystal Pepsi in National and International markets but was unable to fully penetrate because of severe competition posed by its either competitors or the companies that already have significant market share. PlaceThe placing of the product plays a rattling role in increasing sales revenue and gaining the maximum profit from the market. But like promotion, placing depending on emphasis. Cryst al Pepsi has emphasized and stressed on promoting its formula and stretched to convince peck that how different this cola is and what health benefits would they get after drinking it11. The mistake that was done by PepsiCo was in differentiation and placement of its product. The product was different than regular Pepsi-Cola and Coca-Cola but had the same appearance and taste as of 7up and Sprite. That is why it became hard for Crystal Pepsi to differentiate itself in the market and form a new image in its consumers minds. DistributionCrystal Pepsi was first taste tested by participants from different target markets and then was released to test market in April 1992. The launch was limited to test the reaction of its target consumers. The test markets were conducted in Denver, Dallas, and Providence, Rhode Island for nine months peachy bringing all the possible changes to the formula according to the preferences of the consumers. It was then launched nationally during December 1992. Crystal Pepsi was among the darling drinks of its consumers at that time and gained a dear(p) market share in matter of weeks. People tried it partly due to curiosity just to see whats new in there12. It was available at all the major retailers like Walmart and did very well in sales. After its launch in the United States it was launched in Canada, europium and Australia for limited time. The time span for Europe was the highest among all the markets but ultimately pulled off the shelves due to poor sales13. The Canadian and Australian Markets responded the same as United States but since Crystal Pepsi held different grounds in terms of taste and appearance, it lasted longer than United States. Pepsi later introduced Pepsi Max in Australia substitution Crystal Pepsi during the summer of 1993. MexicoA newer version of Crystal Pepsi under the name of Pepsi Clear was introduced in 2005 in Mexico. However, it was available for a limited time and in quantity in the market. It was another(prenominal) attempt to animize the product in an international market where diet colas are among the most favorite drinks. The product was not a failure but discontinued after the limited time14. Target MarketOne of the sensitive and time consuming decisions for any company to make is to get proper knowledge of its target market. Many companies have failed to properly evaluate the preference and taste of its target markets and vanished completely or at least their product lines were disappeared from the market. Crystal Pepsi rivet on two types of consumers1. Health conscious individuals2. People who prefer unobjectionable soft drinks over colasHealth Conscious IndividualsThe first target market was quite easy to capture because at the time of its launch wad in most of the developed countries were getting health conscious. They made example their part of life. It was the start of an era where people begun to think of their fitness and gave exercising and fitness p riority15. PepsiCo targeted those individuals and presented them an innovative drink with fewer sweeteners and lower calories to help them in achieving their fitness goals. By removing the brown color from the regular cola, Crystal Pepsi substantially made an impression of pure drink by presenting an image of bang-up health, purity and icy cold-water to its drinkers. Soft-drinkersThe other category was hard to tackle as many colorless soft-drinkers were already committed to their existed products and were brand loyal. However, the marketing strategy done by PepsiCo paid off during its launch and people tried the new product for the change. However, this market wasnt captured at all and people went back to their original drinks completely ignoring Crystal Pepsi16. PepsiCo put all of their nidus and attentions toward this group by changing formulas, packaging and differentiation, putting their health conscious group at stake. They lost both markets in matter of months17. Competitor sPepsiCo has always been and still is in direct competition with Coca-Cola, another food and beverage giant. The competition is so severe that they spend millions of dollars to protect their secrets from one another just like many major companies in Silicon Valley. Although the challenger between Pepsi and Coca-Cola is always severe, the other rivals were tough too. First Movers AdvantageCrystal Pepsi was one of its kind products that was first introduced to a limited target market, made a huge impact in its test market, launched with a swell formula, failed and disappeared in 15 weeks. It is one of the most anticipated products by PepsiCo still demanded by many consumers to date. Crystal Pepsi has enjoyed its top spot for few months and has gained the first mover advantage. They spell bound the market with its fewer sweeteners, low calories and new formula with amazing prices in the market. Consumers liked the taste initially as it was a 90s reason to drink cola without color , caffeine or preservatives1819. CompetitionCrystal Pepsi was introduced to directly compete with already existed products in the market such as Clearly Canadian. This and similar products were already held the major market share and stayed strong in its demand vs supply. They addressed the need and essential of its consumers more strongly as compared to its competitors. Crystal Pepsi when came in targeted its competition in a unique way. Although the cola was colorless, it was a direct threat to Clearly Canadian and Quibell. Clearly Canadian and Quibell both offered non-carbonate drinks that were the market segment of soft-drinkers. Their products still exists in the market in many flavors. Coca-Cola, on the other hand, tried to enumerate up with same product but with different strategy and named it as Tab Clear which also failed in market miserably. Although Coca-Cola also pushed its product like Pepsi, the results were the same for both the companies. Reason for failureAs menti oned forward in the discussion, the major contributor for failure of product was lack of differentiation. PepsiCo stressed over its new formula but failed to meet the expectation of consumers. It was hard for customers to tell the difference between Crystal Pepsi and 7up or Sprite. Crystal Pepsi failed to target its market accurately. The cola was launched for health conscious individual and soft-drinkers20 but lost its way to form a brand image in the minds of consumers. One other factor for failure was poor name execution. Crystal Pepsi was named crystal to give it an image of pure drink that was more attracted to older coevals as compared to the younger ones. The younger generation was still drinking regular colas that had the same cost as of Crystal Pepsi. Evaluation/CritiqueThe product was made with an intention to target the consumers that are health conscious and functional their way out towards healthy lifestyle. Thelack in differentiation and positioning of product made things worse for Crystal Pepsi that was in competition since its launch. emphasize on new formulas over and over again, cost the company coarse sum of money and time. Overall, the product was never seen as a failure, rather, an hazard to study the market accurately for future products.References1. Miller, Cyndee. (1993, February). Ebsco host Database. Trendy marketers want consumers to see right through their products. http//gsuproxy.govst.edu3963/ehost/detail?vid=3&sid=95159dfc-8f54-472c-98c0-0c533cb0e06b%40sessionmgr115&hid=117&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3ddb=buh&AN=17599561 2. Lavinsky, David. (1993, March). Ebsco Host Database. When bangle wears off, soft drinks clearly will fail. http//gsuproxy.govst.edu3963/ehost/detail?vid=10&sid=95159dfc-8f54-472c-98c0-0c533cb0e06b%40sessionmgr115&hid=117&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3ddb=buh&AN=17598728 3. Triplett Tim. (1994, May). Ebsco Host Database. Consumers show little taste for clear beverages. ht tp//gsuproxy.govst.edu3963/ehost/detail?vid=13&sid=95159dfc-8f54-472c-98c0-0c533cb0e06b%40sessionmgr115&hid=117&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3ddb=bsh&AN=9410311353 4. Laura Zinn. Pepsis future becomes clearer. Bloomberg handicraft week. January 31st, 1993 < http//www.businessweek.com/stories/1993-01-31/pepsis-future-becomes-clearer 5. Eben Shapiro. Its a transparent attempt to revive Pepsis Cola sales. The New York Times. April 13th, 1992. < http//www.nytimes.com/1992/04/13/business/it-s-a-transparent-attempt-to-revive-pepsi-s-cola-sales.html?action=click&module=Searchion=searchResults&mabReward=relbias%3Ar& uniform resource locator=http%3A%2F%2Fquery.nytimes.com%2Fsearch%2Fsitesearch%2F%3Faction%3Dclick%26region%3DMasthead%26pgtype%3DHomepage%26module%3DSearchSubmit%26contentCollection%3DHomepage%26t%3Dqry51%23%2Fcrystal%2Bpepsi%2F 6. Editorial review. New Pepsi drinks offer clear choice. Dayton unremarkable News. December 13th, 1992. < http//nl.news bank.com/nl-search/we/Archives?p_action=doc&p_docid=0F5052CF4CD4FA55&p_docnum=7 7. Del Jones, USA Today. Even good CEOs pick the wrong direction. ABC News. November 7th, 2007. < http//abcnews.go.com/Business/story?id=3830073 8. Jeff Hirsch and Tom