Memo

TO: Mr. David Tsiklauri

FROM: George Sibashvili

Date: 30 March 2004

Subject: Schweppes Case

Schweppes wants to introduce the SRGA products as the line extension to its current products portfolio. The company expects that this can also be an ideal way to bridge the gap between the company’s image as a marketer of mixers and its desire to be a mainstream soft drink company. Of course, it is also aimed to bring additional profits to the Schweppes.

The new product, SRGA, is also consists of carbonated water, sugar syrup and ginger flavour while it is expected to create the new flavored versions of the established adult soft drink markets by its entrance into the market. It is aimed to have distinctive personality to change Schweppes traditional perception. SRGA is targeting at the mainstream soft drink markets. The test market indicated that it has a unique appealing taste and many of those tried it felt it was fascinating new soft drink that can be consumed for all occasions.

The overall market - Customers

Generally speaking, there are three basic segments of beverage market. The largest one is the general soft drink that is dominated by Coca-Cola and Pepsi Cola. Then comes the lemon-lime. Another segment the adult soft drink that includes beverages that were used as mixers with alcoholic beverages as well as others that were consumed as general soft drink. Adult soft drinks consist mainly of ginger ale, club soda, tonic water, bitter lemon, unsweetened, manufactured, and natural sparkling waters and sweetened sparkling waters.  

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For most consumers, Schweppes products, especially the ginger ale, are perceived as the upper mixer image that limited their growth potential and isolated the company from the vast soft drink market. The soft drink market is dominated by Coke and Pepsi-Cola while there are many others competing for the rest. But the adult soft drink market is more or less dominated by Schweppes and Canada Dry while the market itself has less potential compared with other categories. Among the adult soft drink market, soft drink has a much larger market than the mixer. But from the consumer research conducted by ...

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