Vita-Go, Inc., a division of PepsiCo
1. Company Description
Vita-Go, Inc. is a division of PepsiCo which was formed by Jennifer Stieffenhofer, Christine Stear, Sally Swartz, Ryan Tate, Jonathan Vick, Jaclyn Wisecarver, and Teel Witt to develop, market, and promote a product that is inexpensive and convenient for the consumer to utilize on a daily basis in order to promote wellness. Initially, the line was introduced in the Lynchburg, Virginia market, spread to Maryland within the next 2 years, and to North and South Carolina within the next few years.
To the best of Vita-Go’s knowledge, Vita-Go is the only product/beverage on the market today that, with just one simple twist of a cap and a shake of a bottle, releases a daily dose of vitamins and nutrients equal to a person’s recommended daily intake of vitamins. What also sets the bar high on this product in relation to others is the availability of the product. While most manufacturers feel that their product can only be available in health stores, Vita-Go is not only available in health stores, but also grocery, convenience, and superstores.
2. Strategic Focus and Plan
“This section covers three aspects of corporate strategy that influence the marketing plan: (1) the mission, (2) goals, and (3) core competency/sustainability competitive advantage” (Kerin, Hartley & Rudelius, p.47) of PepsiCo.
Mission
Vita-Go’s mission is in line with PepsiCo’s mission which is "to be the world's premier consumer products company focused on convenient foods and beverages. We seek to produce financial rewards to investors as we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity" (PepsiCo, 2015).
Vision
"Our vision is put into action through programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company” (PepsiCo, 2015).
Performance with Purpose
Just like PepsiCo, “we're committed to achieving business and financial success while leaving a positive imprint on society - delivering what we call Performance with Purpose. Our approach to superior financial performance is straightforward - drive shareholder value. By addressing social and environmental issues, we also deliver on our purpose agenda, which consists of human, environmental, and talent sustainability" (PepsiCo, 2015).
Goals
For the next five years, Vita-Go seeks to accomplish the following goals:
· Nonfinancial goals - “As a leading food and beverage company, we believe we can play an important role in helping people lead healthier lives”, (PepsiCo). Vita-Go’s bottle will be manufactured by PepsiCo. PepsiCo, as well as Vita-Go, seeks to achieve a healthier lifestyle by presenting vitamins on the market that allow customers to enjoy their vitamin in-take.
1. To provide a healthy, affordable and convenient product.
2. To continually introduce new flavors.
3. To create new bottle designs and/or colors to keep the consumers interested.
4. To use natural ingredients that are manufactured in the United States.
· Financial goals
1. To effectively manage debt in order to maximize profit.
2. To achieve a profit margin of at least 10% in order to support both reinvestment in the company and a dividend payment to stockholders annually.
3. To maintain liquidity ratios such as Current Ratio and Quick Ratio of 100%, +/-10% which is consistent with historical liquidity ratios as published on NASDAQ.com.
Core Competency and Sustainable Competitive Advantage
Vita-Go is committed to the health of all people. The core competency of Vita-Go is to make an easily accessible product that will meet the following goals:
(1) Provide all-natural liquid vitamins to people who are seeking to maintain a healthy lifestyle, while attracting those who avoid taking traditional vitamin supplements due to the unfavorable effects.
(2) Globally market and distribute the product using PepsiCo’s proven model, so that consumers have the opportunity to take advantage of the long-term health benefits of vitamins delivered by the convenience of Vita-Go.
As people seek to live healthier lives, Vita-Go is committed to providing all natural liquid vitamins that are easily accessible, ready to go, and affordable. These core competencies contribute to a sustainable competitive advantage. As a division of PepsiCo, Vita-Go will enjoy the reputation of a company that delivers quality products people can trust.
3. Situation Analysis
The situation analysis provides an overview of Vita-Go, Incorporated’s strengths, weaknesses, opportunities and threats in a SWOT analysis table. The situation analysis also covers the industry analysis, competitor analysis, company analysis and competitor analysis.
SWOT Analysis
Figure 1 shows the strengths and weaknesses (internal) and opportunities and threats (external) affecting the market opportunities for Vita-Go, Inc., a division of PepsiCo. This SWOT analysis demonstrates the proven competitive position of PepsiCo and its new Vita-Go division.
Figure 1. SWOT Analysis for Vita-Go, Inc.
Internal Factors |
Strengths |
Weaknesses |
Management |
Experienced, innovative and flexible |
Potential heavy work demands spread amongst a small team |
Offerings |
Distinctive, natural and affordable product |
Substitute products available from competitors |
Marketing |
Available and well received in five states within the United States and growing |
No global marketing or presence |
Personnel |
Original founders with no turnover |
Knowledge transfer if an original founder leaves |
Finance |
Net profit steadily increasing |
Resource limitations in the vitamin market |
Manufacturing |
Natural ingredients manufactured in the United States |
Possibility of weak supply chain in newer market |
R&D |
Continue work to deliver a superior product |
Minimal experience in the vitamin industry |
External Factors |
Opportunities |
Threats |
Consumer/Social |
Move to health efforts may strengthen the demand |
Consumer acceptance of liquid vitamins |
Competitive |
Well-known reputable company |
Competitors may introduce their version of the liquid vitamin to the market |
Technological |
Capability to mass produce |
Competitors may have the ability to mass produce |
Economic |
Affordable to most consumers |
Healthy lifestyle not a priority for some consumers |
Legal/Regulatory |
High standards and regulations in the U.S. Market |
Possible tariffs and quotas in global market |
Vita-Go’s primary internal strengths are its experienced, innovated and flexible management staff, and its distinctive, natural and affordable product. Vita-Go is already proven in five states within the United States. Positive external factors include the wide spread move to health initiative, the affordability to consumers, and the well-known Pepsi name. The tie to Pepsi will make it easier for Vita-Go to mass produce to meet market demand.
Considering internal factors, the main weakness of Vita-Go is the possibility of a weak supply chain in this newer all natural liquid vitamin market, and its lack of presence in the global market. Considering external factors, threats include competitors that may introduce their version of all natural liquid vitamin water to the market, and the possibility of tariffs, quotas and other potential legal and regulatory issues when expanding to the global market, as well as consumer acceptance of liquid vitamins.
Industry Analysis
According to the Annual Review of Food and Science Technology, the global market for nutraceuticals, a food product that provides health and medical benefits, is increasing as consumers become more aware of the ability of these foods to improve health and prevent disease (Augustin & Sanguansri, 2015). The primary source driving this market are the baby boomers who are aging, want to live longer, and have a significant amount of disposable income. “The global functional food market is expected to exceed $230 billion in 2015 with a growth rate of 15%. The global nutraceuticals ingredient market is expected to grow from $23.8 billion in 2013 to $33.6 billion in 2018, with a compound annual growth rate of 7.2%” (Augustin & Sanguansri, 2015). The greatest market is in the United States where sales of $8.62 billion are expected by 2015, with 21% growth (Augustin & Sanguansri, 2015). The main products driving this growth are energy drinks.
Health improving drinks are marketed to different demographic groups: infants, children, teens, adults, and the elderly. Energy drinks that target general well-being excel in performance. However, the greatest sales are seen in energy-boosting foods and drinks.
Delivery methods affect the quality of the ingredients. It is important to encapsulate the nutraceutical ingredients prior to incorporating the ingredients into the food. This is necessary to protect the appearance, taste, and freshness due to storage (Augustin & Sanguansri, 2015).
Key Competitor Analysis: The Liquid Vitamin Market
There are about twenty different ready to drink liquid vitamin drinks on the market currently. Supporters of liquid nutritional supplements believe the body uses nearly all of the vitamin and mineral content in liquid vitamin drinks. According to a Gallup poll (2013), half of American adults take vitamins. This increases to two-thirds with older Americans (Gallup, 2013). There are two options available to consumers, liquid or solid (pill or powder) forms. The liquid vitamin market is growing due to the belief that the nutrients are better absorbed in liquid form, as well as the reduction of side effects. The primary determinants for consumers are quality and price. The liquid vitamin market is currently focused on direct selling, health food stores, or websites for distribution. The competitors in this industry sell their product for a cost ranging between $1.03 - $4.44, per daily serving (Williams, 2015). The strengths of the competitors are the testimonies of the product users involved with direct sales, as well as the quality of the liquid vitamins. However, direct sales limit the products distribution to a smaller portion of consumers. Health food stores generally do not have the marketing capacity to reach a large portion of the public. Consequently, many of the current vitamin consumers are using solid options with the accompanying side effects without the awareness or convenience of quality liquid vitamins distributed mainstream through grocery and convenience stores.
Through PepsiCo, this product can be made more readily available by marketing in vending machines, convenience stores, and grocery stores. This would give a competitive edge to PepsiCo in the liquid vitamin market. The marketing plan would also successfully provide a liquid vitamin to the public easily, efficiently, and safely. Distributing a liquid vitamin in this manner would break into a new untapped segment of the market.
Company Analysis
Vita-Go will provide customers with vitamins that are quick and efficient. The employees of Vita-Go are very knowledgeable in healthy choices. However, Vita-Go also has multiple physicians and scientists that will continually assist in creating more delicious flavors and choices involving multi-vitamins, as well as, additional supplements that customers may desire, along with special choices for kids. Vita-Go has also teamed with professional business consultants that have explicit understanding about new-product development, along with pricing methods.
The main objective is to position Vita-Go, Inc. as the leading source for consumers to achieve healthier lives by allowing consumers to enjoy their vitamin in-take. The marketing strategy will pursue to initially create customer awareness regarding their services offered, develop that customer base, and work toward building customer loyalty and referrals.
The message Vita-Go, Inc. will seek to communicate is that Vita-Go is the only all-natural vitamin supplement with a self-contained design allowing for the highest quality vitamins on the market. This message will be communicated through a variety of methods. The first method will be advertisements. The bulk of the advertisements will be social media, Facebook, Pinterest, and Twitter, which produce remarkable numbers for the desired target population. As a partner of PepsiCo building on their loyalty base will support the overall growth of Vita-Go, Inc. Establishing aan equally valuable affiliation will allow both organizations to develop visibility for each other.
Customer Analysis
Customer Characteristics:
Vita-Go’s consumers are predominantly those who are healthy-minded and are focused on exercise and active lifestyles. The households that purchase Vita-Go products range considerably from 1 to 4 people. Vita-Go’s products are on-the-go vitamins. The vitamins appeal across the generations, including consumers who are single with busy lives,, parents who buy products for themselves and their children, the largest segment of purchasers, the baby boomer generation.
The incomes of consumers that purchase Vita-Go products approximately begin at $40,000. Nevertheless, Vita-Go does seek to cater to all households and incomes by offering lower-priced options as well.
Health and Nutrition Concerns:
People across the world are better informed in regards to their overall health. Each day brings about new challenges and contributing factors to the unhealthy lives many people live. While staying informed about the need for healthier living in conjunction with incorporating daily exercise people will continue to live longer lives as a result of continual better choices for themselves when it comes to their overall health. A recent Gallop poll indicates that 46% of men and 54% of women take daily multivitamins of some kind. The concern for those not taking multivitamins on a daily basis come from the lack of evidence that vitamins, “don’t help extend life or ward off heart disease and memory loss.” Multivitamins should be taken to increase the overall health and wellness and to fill in nutrient gaps. Additionally, scientific research supports that multivitamins work for those purposes. Finally, while multivitamins are not a cure for all specific aliments or disease, multivitamins are proven to help reduce the risk of cancer and cataracts in addition to providing a bridge to the nutrition gap and overall health and wellness.
Vita-Go in dedicated to providing a liquid vitamin that is easy to digest and made from only natural ingredients. Offered in a variety of flavors and conveniently available to people while keeping in mind the affordability to ensure Vita-Go reaches across all levels of income. Vita-Go is encapsulated to retain the freshness of the ingredients and further ensures the overall quality of the vitamins. (or whatever you plan to name it):
References
Augustin, M.A., & Sanguansri, L. (2015). Challenges and solutions to incorporations of nutraceuticals in foods. Annual review of food science and technology. Vol.6. Retrieved from http://www.annualreviews.org.ezproxy.liberty.edu:2048/doi/pdf/10.1146/annurev-food-022814-015507
Cohen, J. (2015). Are liquid vitamins better than tablets? Retrieved from http://vitamins.lovetoknow.com/Are_Liquid_Vitamins_Better_than_Tablets
Gallup. (2013). Half of Americans takes vitamins regularly. Retrieved from http://www.gallup.com/poll/166541/half-americans-vitamins-regularly.aspx
Kerin, R., Hartley, S., & Rudelius, W. (2013). Marketing the core (5th ed., p. 61). United States; McGraw-Hill Education.
PepsiCo. (2015). Who are we. Retrieved from http://www.pepsico.com.
Williams, T. (2015). Liquid multivitamin ranks. Retrieved from http://www.businessforhome.org/mlm-500-companies-revenue/doctors-in-vitamins/liquid-multi-vitamins-ranks/
Goodman, B. (2013, December 16). WebMD . Retrieved from Webmd.com: http://www.webmd.com/vitamins-and-supplements/news/20131216/experts-dont-waste-your-money-on-multivitamins
Swift, A. (2013, December 19). Gallup . Retrieved from Gallup.com: http://www.gallup.com/poll/166541/half-americans-vitamins-regularly.aspx
(n.d.). Goodman, B. (2013, December 16). WebMD . Retrieved from Webmd.com: http://www.webmd.com/vitamins-and-supplements/news/20131216/experts-dont-waste-your-money-on-multivitamins Swift, A. (2013, December 19). Ga llup . Retrieved from Gallup.com: http://www.gallup.com/poll/166541/half-americans-vitamins-regularly.aspx

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