This is a follow up from a previous assignment. The following is what was submitted before and then the instructions to what follows it is at the end.
Products and Services
Introduction
Historically the major consumers of sports nutrition products have been bodybuilders and extreme or professional athletes. This is not the prevalent case in the current sports nutrition industry. With a new trend of health awareness, prevention, and the importance of everyday fitness, sports nutrition supplements have entered more mainstream markets, consumed by both recreational and more traditional lifestyle users (TMR, 2013). In 2012, the U.S. sports nutrition market grew by 15% reaching a total of $4.7 billion; this growth is attributed in part to the expanded consumer base (Bodimeade, 2013). This industry is growing globally as well. The nutritional supplement group, which includes vitamins, minerals and supplements, is projected to grow to $60 billion worldwide by 2021 (Lariviere, 2013). The monumental growth of this industry has many contributing factors. In the United States, health and fitness programs such as First Lady Michelle Obama’s “Let’s Move” have brought large-scale awareness to consumers of the importance of healthy eating and exercise. There are similar programs taking shape in other countries as well.
The current global brand leader in sports nutrition is the Irish company Glanbia. Glanbia leads the U.S. in the sports nutrition industry and is a global supplier of whey protein and micronutrient mixes (Glanbia, 2014). MusclePharm, a sports nutrition company, started in 2008 by former NFL player Brad Pyatt, is a close competitor to Glanbia with both companies offering similar products (Lariviere, 2013). The large sports nutrition companies offer a wide variety of products with target consumers ranging from professional and Olympic athletes to the weekend warrior. It can be argued that due to the large scope and range of products offered by the bigger sports nutrition companies, there is less emphasis placed on the ordinary everyday working individual who is seeking to increase his or her fitness level.
Adult Energy Products
This new and trendy focus on healthy living opens the door for companies to profit from offering a variety of sports nutrition products. Sports nutrition supplements are still typically marketed to the athlete or the habitual gym member, missing out on the substantial market of the working adult. The working adult is considered those who would like to improve their fitness level, but they are constrained by the 9 to 5 work week. At the conclusion of a workday, many adults feel drained and exhausted from the day’s grind and do not want to hit the gym or the road for a workout. This is where our company, Adult Energy, can help. Adult Energy is currently a privately owned company that specializes in nutritional supplements for the working adult. Adult Energy offers consumers a physical sport product in the form of nutritional beverages, powders, gels, and bars. Each of our products is geared towards either increasing the energy level of our consumers or helping in the active recovery after a workout. Adult Energy sets itself apart from other nutrition supplement companies by specifically targeting the working adult. The “Afterhours” product line is formulated to provide sustaining energy through a workout after a full day’s work. This line includes the “5:00 Warrior” gel and powder packet as well as the “Green energy” shake. The “Recharge” product line is formulated to help the body recharge and heal after a tough workout. The core products are the “Afterhours” and “Recharge” brands, however the company also offers supplementary products in form of tailored meal plans and recipes.
Situation Analysis
Adult Energy In Oklahoma State
The company “Adult Energy” is mainly based on the production of sport recovery and energy beverages. These products are mainly supposed to be used by adults during and after sports so as to enable them rejuvenate and maintain their health. It is situated in the United States, in Oklahoma State. There are many factors, both exterior and interior which affect the progress of this company. Some of these features cannot be controlled and others can be controlled.
The place in which this company is situated is essential for ensuring its growth. First of all, the Oklahoma City has been rated the first when it comes to the most affordable cities in America. It is also the 5th fastest growing city. It features the lowest business costs among many other cities in the country. It emerged among top 25th best performing states and is considered as the best place for young adults to thrive when it comes to doing business (Lin et al.,2013) . One of the many reasons why people should consider doing business in Oklahoma is because it is growing in a faster rate than any other area. The businessmen and authorities in Oklahoma have a strong belief in partnership is essential for its success (Marie, n.d). The environment is business friendly as it features low costs and a diverse economy. This has enabled the various companies situated here to be profitable and hence stable.
The legal environment of Oklahoma is suitable for any new business as it does not feature heavy taxes or other charges to set up and run the business. To enable the state to grow, the owner of the business must pay taxes for sales made, consumer use and many others. These are the basic forms as the taxes in Oklahoma are not extensive (Rickman, 2013). The many businesses in the region are still struggling to grow in Oklahoma; therefore the processes are simple for anyone who wishes to set up any new business. The registration of the business name is done through the Secretary of State’s office. This step is essential as it reserves the business name. Since this business is formal, it must be registered (Marie, n.d). Employees will be required to work in the company and also for the sales purpose. Therefore, this business will be required to undergo some additional registrations. First of all, a withholding account is set up, which will be used for income taxes, and is done through the Oklahoma Tax Commision (OTC). Second, another account for employees’ unemployment taxes is also set up through the Oklahoma Employment Security Commission (OESC). The company must also have a private compensation insurance policy to ensure the safety of all employees. The “Adult Energy” Company will also require obtaining special licenses and business permits so that it is allowed to operate within the area.
The demographics show that the people living in this region are still young and energetic. Therefore, it increases the chances that they will be working out and involving in sporting activities. They will need to rely on energy drinks and bars to help them recuperate from the stress of sports. This shows that the business has a better chance of performing better in this region because the demand is higher in this region.
This sports energy drinks and bars are being recreated each day. They are also inspiring the introduction of new products under the sports category. Technology is also changing and most of the sports today and the many to come will soon be performed indoors or in an enclosed area (PR, 2012). This will encourage more people to work out and hence the target market will increase in size. The direct competitors to this company feature the producers of general soft drinks and mineral waters. Most people do not understand the benefits of sports energy products and will therefore seek the nourishment from mineral water or soft drinks. Their products seem to attract more customers because of the cheap price when compared to the sports drinks. Indirect competitors feature the companies which produce bars such as the well-known chocolate and many as such (Fox Sports, 7). Most people will be able to tell the difference between these and the energy bars.
The energy drinks and bar company has strengths such as being situated in a supportive environment which enables it to grow with little competition whatsoever. A weakness is the fact that most people do not know the difference and importance of sports energy drinks, even the specific people who are supposed to market it. The changes in technology enable it to grow as it brings forth more customers who will need the product. The threats include the many filings and processes involved in the production and marketing of the products.
In conclusion, it is apparent that although the business is situated in a region of business growth, that alone does not guarantee that it will prosper. Instead, it will still face many competitors whose products are already well known. The best plan is to market it effectively.
References:
Bodimeade, M. (2013). U.S. sports nutrition market grew by 15% through 2012. Companies and Markets.com. Retrieved from http://www.companiesandmarkets.com/News/Food-and-Drink/US-sports-nutrition-market-grew-by-15-through-2012/NI7252
FOX Sports, S. (7). FOX Sports Southwest to Host Special Benefit to Raise Funds for Oklahoma, North Texas Tornado Victims. Business Wire (English).
Glanbia. (2014). Our brands. Retrieved from http://www.glanbia.com/our-brands
Lariviere, D. (2013). Nutritional supplements flexing muscles as growth industry. Forbes
Magazine. Retrieved from http://www.forbes.com/sites/davidlariviere/2013/04/18/
nutritional-supplements-flexing-their-muscles-as-growth-industry
Lin, B., Stackhouse, J., Sun, W., Hu, Y., Liu, Z., & Fan, T. (2013). Is Oklahoma getting drier?. Journal Of Quantitative Spectroscopy & Radiative Transfer, 122208-213. doi:10.1016/j.jqsrt.2012.07.024
Marie, P. (n.d). Oklahoma Treasurer Scott Meacham: Shortfall not too bad given economic climate. Journal Record Legislative Report (Oklahoma City, OK),
PR, N. (2012, July 9). Oklahoma Economic Developers Use Business Climate Survey Data to Tackle Workforce Issues. PR Newswire US.
Rickman, D. S. (2013). Should Oklahoma Be More Like Texas? A Taxing Decision. Review Of Regional Studies, 43(1), 1-22.
The instructions for this assignment add on are as follows:
Analysis of Target Markets
This section includes the following:
a. Macro (overall view of group incl. wholesalers, retailers & purchasers) and micro
views (specific consumer) of the target markets
b. Remember STP: Segmenting, Targeting & Positioning!
i. Clearly understand consumer purchase decision & key influences
ii. Consider the “Black box” consumer concept— many variables may go into the
purchase behavior and decision, but only one output seen (buy or not buy)
iii. How will you “segment” your consumers? Based on what?
c. Market Size
i. Based on info from situation analysis, what is potential “size” of your target
market?
ii. Growth, demand trends, potential number of people
d. Market Research
i. Primary, secondary information about target market & consumer
ii. Primary-personal interviews
iii. Secondary more general information (like SGMA reports-Sport Participation)
iv. Quality of decisions depends on quality of information .
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