Situation Analysis

The powdered beverages category, valued at $21 million, had been experiencing a steady decline over the past four years (-10.6% category value decline). Vitafresh, a key player in this market, faced even greater challenges with a year-on-year decline of -14.2%.

Factors contributing to this decline included consumer migration towards alternative formats, such as ready-to-drink beverages, coupled with low margins for both retailers and manufacturers amid rising labor costs. Vitafresh’s production facility heavily relied on powdered formats, necessitating strategic adjustments to reverse market losses.

Given Vitafresh’s heavy reliance on powdered formats at its production facility, this initiative demanded a strategic recalibration to reverse market losses. This involved me stepping back from day-to-day operations to devise and roll out a comprehensive three-year category growth strategy.

Insights and Opportunities Identified

Consumer Trends and Preferences:

• Consumers starting to demand more natural alternatives and moving to fresh & ambient juice.
• A growing market for flavored ready-to-drink waters, suggesting a preference for enhanced formulations without excessive sugars.
• Consumers increasingly preferred convenient and portable beverage options.

Reinforce Brand Positioning and Differentiation:

• Emphasise Vitafresh’s offerings to stand out in the competitive landscape by reformulating with all natural ingredients and updating packaging design across the range.
• Target specific consumer groups with tailored product innovations to revitalise powdered beverages and increase factory utilisation.

Segment Strategies:

1. Families: Reformulate current 5-pack offering responding to consumer preferences for natural ingredients and healthier options
   • Reformulate current 5-pack offering and relaunch Vitafresh with all natural colours & flavours.
2. Sports Enthusiasts: Re-launch VitaSport, Addressing Nutritional Needs for Active Lifestyles
   • Reformulate VitaSport to cater to the nutritional requirements of sports enthusiasts.
   • Introduce convenient 1L 5-pack and 750ml stick pack formats for on-the-go hydration and replenishment during physical activities.
3. Health Conscious Consumers: Innovate with Low-Calorie, Fortified New Product Development (NPD) Options
   • Develop low-calorie, fortified options to compete with popular ready-to-drink beverages like Mizone.
   • Emphasize natural ingredients, no added sugars, and enhanced nutritional benefits to attract health-conscious consumers.

1. Vitafresh Market Opportunity and Product Development

Product Development: All-Natural Reformulation and Innovative Packaging

• Product Enhancement:
  Reformulated Vitafresh with all-natural colours and flavors, and no artificial sweeteners eliminating artificial additives to meet consumer demand for healthier alternatives within the powdered beverages segment.

Packaging and Pricing Strategy:

• Packaging Innovation:
  Introduced Vitafresh in modernised packaging that highlighted its all-natural ingredients and mainstream positioning, enhancing shelf appeal and consumer perception.
• Competitive Pricing:
  Positioned competitively to align with mainstream market positioning, ensuring affordability while emphasising the value of natural ingredients.

Distribution and Promotion:

• Market Penetration Strategy:
  Rolled out Vitafresh in mainstream grocery stores nationwide, leveraging a robust distribution network to maximise availability and accessibility.
• Integrated Marketing Campaign:
  Executed a comprehensive marketing campaign encompassing above-the-line (ATL) advertising and targeted promotions to educate consumers about Vitasresh’s natural formulation and benefits.

Achievements and Impact:

• Market Performance Post-Launch:
  Vitafresh achieved significant market uptake, becoming the clear number two brand with a +9.7% year-on-year growth rate in the powdered beverages category.
• Category Contribution:
  The launch of Vitafresh contributed to a 10.8% year-on-year growth in 5-pack sales, demonstrating its ability to resonate with consumer preferences and drive category expansion.

Business Impact:

• Profitability and Growth:
  Vitafresh not only reversed declining sales trends but also increased profitability for Vitafresh and retail partners, driven by strong consumer demand for natural, premium-quality beverages.
• Brand Equity and Consumer Trust:
  The successful repositioning of Vitafresh enhanced brand equity and consumer trust, establishing it as a preferred choice among mums and families seeking powdered beverage options.

Conclusion:

The Vitafresh market opportunity and product development plan exemplify strategic innovation and responsiveness to consumer preferences in the powdered beverage market. By prioritising natural ingredients, modern packaging, and effective marketing, Vitafresh successfully revitalised its brand presence, achieved significant sales growth, and solidified its position as a leader in the competitive beverage industry.

Old packaging on the left and new 5 -pack packaging on the right.

ATL campaign. Promoted across magazine and child play spaces across New Zealand.

2. Vita Quench Market Opportunity and Product Development

Market Opportunity:

Leveraging New Zealand’s abundant fresh water sources, there was a significant opportunity to introduce Vita Quench as a convenient, cost-effective alternative to expensive ready-made drinks. By focusing on enhancing profitability for retailers and manufacturers, Vita Quench aimed to meet consumer demand for convenience and health-conscious choices in the beverage market.

Product Development: Convenient Vitamin-Enhanced Water Quenchers

• Product Concept:
  Developed and introduced four variants of Vita Quench in a powdered stick format, specifically designed for easy mixing into a 750ml water bottle.
• Key Features:
  Fortified with 6 B Vitamins and Vitamin C, Vita Quench contained no added sugar and featureed all-natural flavors and colors, appealing directly to health-conscious consumers seeking balanced nutrition.

Packaging and Pricing Strategy:

• Packaging Design:
  Vita Quench was packaged in slimline boxes, making them convenient for carrying in handbags or placing on desks, enhancing accessibility and consumer convenience.
• Competitive Pricing:
  Positioned competitively at $4.49 per pack, each serving cost approximately $0.44 per 750ml, offering significant savings compared to bottled alternatives.

Distribution and Promotion:

• Market Entry Strategy:
  Launched Vita Quench in mainstream grocery stores across New Zealand and Australia, leveraging a robust distribution network to ensure wide availability and accessibility.
• Comprehensive Marketing Campaign:
  Implemented a multi-faceted marketing campaign encompassing direct mail (DM), sampling activities, above-the-line (ATL) advertising, digital marketing initiatives, and a notable promotional stunt to enhance brand visibility and consumer engagement.
• Achievements and Recognition:
  Achieved significant milestones post-launch, including broad-ranging availability and positive feedback from retailers upon its introduction in November 2007. Within the first 6 months, Vita Quench generated $350k in revenue, capturing ~5% market share in a declining category. This contribution helped bolster the overall category value within the powdered beverage segment, demonstrating sustained growth and market impact.

Business Impact:

• Enhanced Profitability:
  Vita Quench not only met but exceeded profitability expectations for both Hansell’s and retail partners, driven by strong consumer demand for convenient and healthier beverage alternatives.
• Brand Reputation and Consumer Trust:
  The successful execution of Vita Quench’s launch strategy significantly enhanced brand reputation and consumer trust, solidifying its position as a preferred choice among health-conscious consumers.

Conclusion:

The Vita Quench market opportunity and product development plan exemplified a strategic approach to meeting consumer needs while driving growth and profitability in the powdered beverage market.

By focusing on innovation, convenience, and health benefits, Vita Quench successfully penetrated the market, contributing positively to category growth and reinforcing brand leadership in the competitive beverage industry.

ATL, sampling and In store Floor Media campaign showcasing the key benefits of Vita Quench

3. Vita Sport Market Opportunity and Product Development

Market Opportunity:

In a dynamic market landscape where consumers demanded convenient, health-conscious options, there was a significant opportunity to innovate within the sports beverage segment. Vita Sport aimed to cater to the needs of active individuals by providing a convenient, low-sugar electrolyte rehydration solution that supports their fitness goals and lifestyle.

Product Development: Advanced Formulation and Convenient Packaging

• Product Innovation:
  Re-developed Vita Sport with an advanced formulation that emphasised electrolyte replenishment and hydration support, tailored for sports enthusiasts and active individuals.
• Key Features:
  Vita Sport offered a low-sugar formula, free from artificial additives, catering to consumer preferences for clean-label products with natural ingredients.

Packaging and Pricing Strategy:

• Packaging Convenience:
  Introduced Vita Sport in convenient 1L 5-pack and 10 x 750ml stick pack formats, designed for easy portability and on-the-go consumption during sports and fitness activities.
• Competitive Pricing:
  Priced competitively to offer value compared to other sports beverages, aligning with consumer expectations for affordable yet high-quality hydration solutions.

Distribution and Promotion:

• Market Entry Strategy:
  Launched Vita Sport across mainstream grocery stores and specialised sports retailers, leveraging strategic distribution channels to ensure broad availability and accessibility.
• Targeted Marketing Campaign:
  Implemented targeted promotions in gyms, at sports events, and through sports magazines, emphasising Vita Sport’s formulation advantages and convenience for active lifestyles.

Achievements and Impact:

• Market Performance Post-Launch:
  Vita Sport successfully penetrated the market, maintaining a strong presence with sustained sales and consumer adoption of its convenient formats and enhanced formulation.
• Category Contribution:
  Contributed positively to the growth of the sports beverage segment, capturing market share and driving category expansion through innovation and consumer-centric strategies.

Business Impact:

• Profitability and Growth:
  Vita Sport enhanced profitability for Hansell’s and retail partners by meeting consumer demand for convenient, healthier sports hydration options.
• Brand Recognition and Consumer Loyalty:
  The successful launch and sustained marketing efforts enhanced Vita Sport’s brand recognition and consumer loyalty, establishing it as a trusted choice among fitness enthusiasts and active consumers.

Conclusion:

The Vita Sport market opportunity and product development plan underscored Hansell’s commitment to innovation and meeting evolving consumer needs in the sports beverage segment. By focusing on advanced formulation, convenient packaging, and targeted marketing, Vita Sport successfully positioned itself as a leader in providing effective hydration solutions for sports and active lifestyles. This strategic approach not only drove growth and profitability but also strengthened brand equity and consumer trust in the competitive beverage market.

Vita Sport Packaging and ATL Print and OOH Campaign