Strategic Repositioning of Capri-Sun Juice Drinks to Extend the Product Life Cycle

QUESTION

Capri-Sun Juice Drinks: Strategic Repositioning to
Extend the Product Life Cycle
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Author: Emma Beacom
Pub. Date: 2022
Product: Sage Business Cases

DOI: https://doi.org/10.4135/9781529797732
Keywords: product life cycle, branding, sales, students, sugar, case studies, consumers, market share,
decision making, advertising
Disciplines: Business & Management, Marketing, Brand Management & Strategy, Marketing Decision
Making, Product Management
Access Date: July 18, 2023
Publishing Company: SAGE Publications: SAGE Business Cases Originals
City: London
Online ISBN: 9781529797732
© 2022 SAGE Publications: SAGE Business Cases Originals All Rights Reserved.
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© Emma Beacom 2022
Sage Business Cases
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Cycle

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Abstract
This case considers how to strategically reposition a product in order to maintain and increase con-
sumer interest, and thereby extend the product life cycle, sales, and profits. The product highlighted in
the case is Capri-Sun, a fruit juice primarily aimed at children, which in 2019 had been experiencing
declining year-on-year sales and reduced market share in the fruit juice beverage category. Decreas-
ing sales have been attributed to increasing consumer trends towards healthy products, and increased
competition from other beverage manufacturers. Currently positioned as a low-cost, ‘fun’ drink for chil-
dren, Capri-Sun are considering how to reposition their product to revitalise sales. Students will be
asked to assess the business problem and apply marketing concepts to a real-life situation, evaluat-
ing various repositioning strategies and their implications, in order to recommend the most appropriate
marketing response. Students will also consider methods which can be used to aid decision making,
and how to communicate the new repositioned product. This case provides a real-life example 1 of
how marketing environment influences such as changing consumer trends and the competitive envi-
ronment can affect the success of a food/beverage company, and provides insight into considerations
for adapting and responding to such pressures.
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Page 3 of 9 Capri-Sun Juice Drinks: Strategic R

Case
Learning Outcomes
By the end of this case study, students should be able to:
• apply knowledge on repositioning to extend the product life cycle;
• develop repositioning approaches;
• appreciate how current market and consumer trends impact on consumer demand and success of
products and brands;
• consider brand associations and the considerations for product positioning; and
• evaluate the appropriateness of various repositioning approaches in a given context.
Case
Capri-Sun is a branded fruit juice drink, originating in Europe, and now distributed in over 100 countries world-
wide. The drinks are packaged in a flexible trapezoidal-shaped pouch, with an attached straw (Figure 1).
Each pouch contains 200 ml (7 U.S. fl oz) of juice, and are typically sold as a bundle, in a cardboard box
(Figure 2), with a box of eight fruit juice drinks costing approximately GBP 3 (Grahns, 2019). Capri-Sun juice
drinks are the only product retailed under the Capri-Sun brand name; therefore the drink and the brand are
synonymous with one another. The unique shape and logo of the product make it instantly recognisable to
consumers. The original and most popular flavour is orange; however Capri-Sun have also introduced black-
currant and tropical fruit flavours, with varied levels of success. Cheery advertising directed at children is typi-
cally used, with advertising slogans reinforcing the ‘fun’ nature of this product. The product is well established
on the global market, having been first introduced in 1969, and flavour variations, as well as fun advertising
targeted towards children, have maintained a certain level of consumer demand for the product. However, in
recent years Capri-Sun’s sales have consistently experienced decline, with an approximate 10.7% reduction
in sales in the United Kingdom between 2018 and 2019 (O’Mahony, 2020). In recent years, there has been
an increasing consumer trend towards health, and parents are increasingly more conscious about the foods
and drinks their children are consuming (Collinson, 2015; O’Mahony, 2020). Related to this, Capri-Sun have
received some negative media attention for the level of sugar in their drinks, with concerns about the artificial
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Page 4 of 9 Capri-Sun Juice Drinks: St sweeteners and preservatives included in their juice drinks (Collinson, 2015; Looveren, 2017). In response to
consumer concerns and trends regarding health, Capri-Sun have been gradually reducing sugar content in
their original orange drink since 1996 (Capri-Sun, 2021), and have introduced new and modified lower-sugar
versions of their drinks. In 2015, Capri-Sun launched a ‘no added sugar’ version of their popular orange juice
drink, which contains 0.8 g of sugar per 100 ml. In 2016, Capri-Sun launched the no added sugar Fruity Wa-
ters product, aimed at encouraging children to drink more water (Nawrat, 2018). In 2018, Capri-Sun launched
a new modified recipe version of their original orange drink, using the artificial sweetener stevia to replace
sugar, thereby reducing the sugar content in the drink by 50% (the original Capri-Sun now contains 4.9 g of
sugar + stevia per 100 ml, versus the former recipe which contained 9.8 g of sugar per 100 ml) (Selwood,
2018). This reformulated product was launched prior to the introduction of the U.K. sugar tax, which imple-
ments a levy on soft drinks containing more than 5 g of sugar per 100 ml (Arthur, 2018). As well as having
promoted the reduced sugar content in their drinks through their advertising, Capri-Sun reinforce on the pack-
aging that their drinks contain no artificial colours, flavours or preservatives (Figure 2).
Figure 1. Capri-Sun 200 ml Pouch (Sold as a Multipack)
Figure 2. Multipack Box Capri-Sun Sold in 8-Pack
Source: www.thesun.co.uk
However, some concerns regarding the healthiness of Capri-Sun drinks remain, which, coupled with the com-
petitive beverage environment, present a threat for Capri-Sun in maintaining and increasing market share
in the beverage category. Fizzy drinks, cordials and squashes present the main competition for fruit juice;
however, sales of these beverages have also decreased, due to health concerns, particularly related to the
amount of sugar in these products (Bainbridge, 2011; Bandy et al., 2020). The fruit juice category as a whole
has experienced decline, with other popular competitor juice brands such as Ribena also noting a decrease
in sales (O’Mahony, 2020). In recent years the beverage category has become more diverse, with increased
popularity of traditional and novel beverage products such as fruit smoothies, milkshakes (and plant-based
alternatives), fortified waters and juices, drinks with added functional benefits or ingredients, fruit/vegetable
‘shot’ drinks, kefir drinks and kombucha drinks (Hughes, 2018; Mordor Intelligence, 2021). As well as expe-
riencing competition from other international brand beverage producers, who are displaying increasing lev-
els of innovation regarding the product profile and packaging of beverages, Capri-Sun are also experiencing
competition from retailers, many of whom have strong-performing own-brand beverage ranges, in addition
to some having created own-brand versions of the popular Capri-Sun juice drinks, at a reduced price (Bain-
bridge, 2011; Brown, 2018).
Capri-Sun’s juice drinks are currently strongly positioned towards children, and have a fun, cheerful image,
communicated via their advertising and on the product packaging. The drinks are positioned as a low-cost,
affordable product, and the flexible, safe and useful nature of their packaging (i.e., the flexible pouch material,
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and the added straw) create a functional product, particularly appropriate for their target market. Capri-Sun
are however conscious of the impact of the increasingly competitive environment, and consumer trends, on
their market share, and are therefore concerned with how to improve consumers’ perceptions of their prod-
ucts, while staying true to their brand image and continuing to provide a product that remains satisfactory to
their loyal customers. Capri-Sun’s marketing director, Mr. Smith, is considering how to reposition the product
to revitalise sales, and tasks the marketing team with considering different options and their viability. He sug-
gests the team evaluate the feasibility and appropriateness of four strategic approaches: image repositioning
(keeping the same product and target market, but altering the brand or product image); product reposition-
ing (keeping the same target market, but changing the product); intangible repositioning (keeping the same
product, but changing the target market); and tangible repositioning (changing both the product and the target
market). Mr. Smith is particularly concerned with how a repositioning will affect the brand, particularly how
it will be perceived by current loyal customers. Although Capri-Sun, being owned by a large food company,
has adequate resources for a significant repositioning, Mr. Smith is conscious that a repositioning strategy
needs to be well justified, and considered feasible in order to merit significant increased marketing spend on
a product whose sales have been decreasing. It is important therefore that the feasibility, and advantages and
disadvantages (risks) of each approach, are well considered.

Please answer the following questions.

How could Capri-Sun reposition their product using:
a. an image repositioning strategy?
b. a product repositioning strategy?
c. an intangible repositioning strategy?
d. a tangible repositioning strategy?

Which of these repositioning strategies would be the best choice for the brand?
3. How could repositioning impact the brand?
4. How might Capri-Sun decide which is the best approach?
5. If the chosen repositioning strategy requires changing the product, should they keep the original prod-
uct on the market?
6. How can Capri-Sun best communicate their new image or product to consumers?

ANSWER

Strategic Repositioning of Capri-Sun Juice Drinks to Extend the Product Life Cycle

Introduction

Capri-Sun, a globally recognized fruit juice brand, has been facing declining sales and reduced market share in recent years due to changing consumer trends and increased competition. To address this challenge, Capri-Sun’s marketing director, Mr. Smith, is considering various repositioning strategies to extend the product life cycle, revitalize sales, and maintain brand relevance. This essay will explore potential repositioning strategies and their implications for the brand, considering image repositioning, product repositioning, intangible repositioning, and tangible repositioning. Ultimately, we will determine the best approach for Capri-Sun and explore how the company can effectively communicate the changes to consumers.

Image Repositioning Strategy

Image repositioning involves altering the brand or product image while keeping the same target market. To implement this strategy, Capri-Sun could focus on rebranding and modifying its marketing messages to emphasize health benefits, natural ingredients, and a commitment to reducing sugar content. The packaging design could be updated to reflect a more mature and health-conscious image, appealing to health-conscious parents while maintaining the brand’s playful and recognizable elements.

 Product Repositioning Strategy

In a product repositioning strategy, Capri-Sun would keep the same target market but modify the product itself. The brand could introduce new flavors with reduced sugar content or explore innovative ingredients to cater to the evolving tastes of health-conscious consumers. For instance, incorporating organic, natural sweeteners or fortifying the juice with additional nutrients could attract health-conscious parents seeking healthier options for their children.

 Intangible Repositioning Strategy

Intangible repositioning involves changing the target market while keeping the same product. Capri-Sun could shift its focus from children to health-conscious young adults or athletes who seek convenient and nutritious beverages. This approach may require adjusting the brand’s communication style, highlighting the product’s benefits for active lifestyles and promoting it as a healthier alternative to sugary drinks.

Tangible Repositioning Strategy

Tangible repositioning entails changing both the product and the target market. In this scenario, Capri-Sun could develop a new line of products, such as plant-based or organic fruit juices, targeting health-conscious consumers across different age groups. This strategy would require significant investment in research, development, and marketing but could offer a long-term competitive advantage.

The Best Repositioning Strategy for Capri-Sun

Considering the current market trends and increasing health-consciousness among consumers, a product repositioning strategy appears to be the most suitable choice for Capri-Sun. By modifying their products to offer reduced sugar content, natural ingredients, and potentially introducing innovative flavors, Capri-Sun can attract health-conscious parents seeking nutritious alternatives for their children.

Impact on the Brand

Repositioning can have both positive and negative impacts on the brand. On one hand, successful repositioning can enhance brand relevance, attract new customers, and improve market share. However, there is a risk of alienating existing loyal customers if the changes are perceived negatively or if the new positioning does not align with the brand’s identity. Thus, careful consideration and effective communication are crucial to maintain brand loyalty during the repositioning process.

Deciding the Best Approach

To determine the best repositioning approach, Capri-Sun should conduct market research, consumer surveys, and focus groups to gather feedback and insights. Analyzing consumer preferences, perceptions, and willingness to pay for various repositioning strategies will help Mr. Smith and his team make data-driven decisions.

Keeping the Original Product on the Market

If the chosen repositioning strategy requires modifying the product, Capri-Sun should consider keeping the original product on the market initially. This will allow consumers to gradually transition to the new formulation and provide an option for those who still prefer the classic taste.

Communicating the New Image or Product to Consumers

Capri-Sun should employ an integrated marketing communication strategy to effectively communicate the changes to consumers. This may include social media campaigns, influencer partnerships, health-conscious endorsements, and interactive events to engage the target audience. Clear and transparent messaging about the benefits of the repositioned product, along with its health value and taste, will be essential to win over consumers’ trust.

Conclusion

Capri-Sun faces the challenge of declining sales and reduced market share, which can be addressed through strategic repositioning. A product repositioning strategy appears to be the most suitable choice, given the current market trends towards health-consciousness. By reducing sugar content and incorporating natural ingredients, Capri-Sun can attract new customers while maintaining brand loyalty. Careful planning, research, and effective communication will be key to the success of the repositioning effort, ensuring Capri-Sun remains relevant and competitive in the ever-evolving beverage market.