The product selected for analysis is MoPro Protein drink. The drink has no artificial flavor, all natural ingredients, 25 grams of protein, and no more than 1 gram of sugar. It is packaged in a biodegradable container. This type of energy drink is more appealing to those that are health conscious because it derives its energy source from proteins rather than sugars. This gives longer lasting energy, without the harmful side effects. It takes advantage of trends for healthier drinks with less sugar and for container that do not contribute to the landfill problem in the same way that plastic bottles do.
The mission of MoPro is to provide a healthy energy drink alternative that does not pollute the environment. This beverage takes advantage of three of the top trends in the beverage industry for 2016. The first is the trend for clean eating and health conscious food and beverage choices (BNP Media, 2016). The terms “Free from” give the image of being healthier, even if the consumer does not need to avoid that particular ingredient (BNP Media, 2016). Natural food processing and all natural ingredients are the third major trend sweeping the industry (BNP Media, 2016).
One of the key strengths of MoPro is that it takes advantage of recent trend in the beverage industry that call for healthier products and packaging. Growth in the protein drink industry continues to grow at a rate of 44% per year and is expected to reach $17.7 billion by 2018 (Crawford, 2014). The market is stable and has been around for many years. Consumers are already aware of the products. This level of industry growth indicates a strong market with tremendous growth potential. The market is still in the growth stage and has not reached maturity. There are many big competitors, but the industry is welcoming to newcomers. Consumers are willing to try new brands. The management team is experienced in the protein drink and health drink industry with over 25 years of combined experience. They have watched the industry grow to where it is today.
The protein and health drink industry is one that has experienced rapid growth, but that also means that there is considerable competition. MoPro will be in direct competition with brands that have an established following such as Pro-Start and Nature’s Best. MoPro will differentiate itself by offering the highest amount of protein allowed and through the use of biodegradable packaging. Consumes who are interested in health and fitness are also typically interested in environmentalism too. This will give MoPro an advantage over competitors that use plastic bottles the contribute to the landfill problem. The consumers will know that they are doing something good for the environment. These points of differentiation need to be stressed in the packaging and advertising to overcome the weakness of being a new brand in a competitive market.
The traditional consumer of protein drinks consists of athletes and fitness buffs. However, there is a general trend in the industry to expand this market to include the general consumer who is a nonathlete (Crawford, 2014). A rapidly growing market offers many opportunities for expansion. All it will take is cross marketing to bring the drink to a new group of consumers. The general market is already familiar with protein and health drinks, but they have not been a major target for the industry. Targeting this market provides many new opportunities for growth.
Another opportunity is the expansion of selling venues. MoPro could be marketed in regular grocery stores, drug stores that carry small amounts of groceries, at fitness clubs, and at sports venues. There are many opportunities to tap into the general market of consumers that are different from the traditional athletic themed venues.
One of the key threats is regulatory threats. Protein drinks are considered a dietary supplement under the FDA’s rules. They are regulated under a different set of regulations than other regular food sources (FDA, 2016). The main regulations controlling the protein drink industry is the Dietary Supplement Health and Education Act of 1994. Under this act the main concern is truth in labeling (FDA, 2016). There is always a possibility that the FDA will tighten restrictions on this area of the market, which could pose a threat to the company or the industry as a whole.
The future actions of competitors could also pose a threat to the viability of MoPro. It is possible that other companies might copy the main selling points of MoPro, such the biodegradable packaging. They might also offer a lower price. Any number of actions by competitors could threaten the new brand. These responses by competitors cannot be anticipated head of time. The company should develop contingency plans for the most likely scenarios that might arise from competitor actions in the future.
The threat of new competition from newcomers in the market is relatively low due to the costs of the facility and licensing. In a saturated market, there is little incentive to enter. The greatest threat in this respect is from companies that are already stablished in other segments of the beverage industry. They have the equipment already and might see the growth potential in the market as lucrative.
- BNP Media. (2016). Top trends for food and beverage in 2016. Beverage Industry. Retrieved from http://www.bevindustry.com/articles/88906-top-trends-for-food-and-beverage-in-2016
- Crawford, E. (2014). Reaching beyond athletes will drive sales of protein drinks. Food Navigator. Retrieved from http://www.foodnavigator-usa.com/Markets/Reaching-beyond-athletes-will-drive-sales-of-protein-drinks
- U.S. Food and Drug Administration (FDA). Dietary Supplements. Retrieved from http://www.foodnavigator-usa.com/Markets/Reaching-beyond-athletes-will-drive-sales-of-protein-drinks