Thomas Edison State College
BUS421: Case Study #2
1. What are the key success factors (KSF) in this industry?
There are many factors contribution to energy drinks, sport drinks, and vitamin-enhanced beverages; however, I believe that their key success factors are their marketing, innovation, and globalization. With marketing, all these beverages are among the pioneers of advertising techniques and styles used to capture the audience. Also many of these beverages are advertised with famous sport player, and other famous people making the product more appealing, not to mention how the products are advertised in magazines, TV, and newspapers. With innovation, the companies producing these products are constantly trying to find something more appealing to the consumer than the last product that was out on the shelves. These companies are also trying to develop new flavors as well as a variety of different affect the drinks can have on the consumer, such as a calming affect, a more energizing affect, or ever vitamin enriched beverage to support a health immune system. With globalization, these products are available virtually everywhere across the world. With globalization, these products are know by more people than if these products were only available in one particular area.
2. Apply the Five Forces Model of Competition tool to analyze the Energy Drinks, Sports Drinks, and Vitamin-Enhanced Beverages.
The Five Forces Model of Competition includes existing competitive rivalry between suppliers, threats of new market entrants, bargaining power of buyers, power of supplies, and the treat of substitute products (including technology change). There is a wide array of substitutes for all of these products that consumer may choose. These products are widely and easily available at low prices, hence the threat posed by these other beverages. These risks can be mitigated through diversification and offering more products in a particular beverages...