Mars Inc. Starburst Performance: Marketing Plan

MRKT 3040

January 26, 2011

By: Joshua S. Neeper

Section 1: Executive Summary

$30 billion! Mars Inc. currently exceeds $30 billion in net sales.

“In 1911, Frank C. Mars made the first Mars candies in his Tacoma, Washington kitchen and established Mars’ first roots as a confectionery company. In the 1920’s, Forrest E. Mars, Sr. joined his father in business and together they launched the MILKY WAY® bar. In 1932, Forrest, Sr. moved to the United Kingdom with a dream of building a business based on the philosophy of a mutuality of benefits for all stakeholders this vision serves as the foundation of the Mars, Incorporated we are today. Based in McLean, Virginia, Mars has net sales of more than $30 billion, six business segments including Chocolate, Petcare, Food, Gum & Confections, and Symbioscience, and more than 65,000 Associates worldwide that are putting our Mars Principles in action to make a difference for people and the planet through our performance.”1

Brands

Candy Gum Pet Products Food & Beverage Snickers Extra Pedigree Uncle Ben’sMilky Way Orbit Whiskas Flavia 3 Musketeers Wrigley Royal Canin CirkuHealthMars Bar Juicy Fruit Snickers Ice Cream BarsMunch Bar SpearmintSkittles DoublemintStarburstTwixDoveM&M’s

My internal and external analysis of Mars has expressed very impressive information about the industry and operations that Mars runs today. They are not the last players to adapt to a changing economy or implement new technologies that serve them and the environment positively. They are considered the leaders and are on the forefront of manufacturing innovation, global distribution and green energy implementation. While deciphering their internal and external environment, I concluded that there is always room for improvement when your number one. They have been able to foresee trends in all economic realms and adapt accordingly. However, I had to think outside the box and determine what Mars could do to maintain market share and increase cash flows, assuming that they allocate the necessary resources to implement a strategy without second guessing. Their operations are streamlined and every aspect I examined, I determined that Mars could implement one of three strategies I consider to be notably profitable, sustainable and most all efficient.

This proposal introduces Mars’s newest product, Starburst Performance, a sports drink launch to enter into a new market of product manufacturing but targeting most of the existing consumers that use Mars products while incorporating a new offline and e-commerce marketing plan to increase sales for all brands. This market only has two competitors: Gatorade and PowerAde, that compete for the same target market but no attempt has been made to threaten their market share, until now. There is opportunity, a new market and limited number of competitors in this proposal. However, this marketing plan has a proposed allocation of $50 million that creates new online and offline marketing strategies, international commercials, endorsements and sponsorships. This proposal is also designed to track multiple realms of analytics in regards to online traffic, sales, awareness, loyalty and effectiveness.

A complete break down of this proposal will be discussed through different sections such as:

1 http://www.mars.com/global/news-and-media/press-releases/news-releases.aspx?SiteId=94&Id=27931

Target Market Competitive Analysis Marketing Plan: strategies, advertising, online, offline, metrics of success, & financials

($50 million is an estimate; the plan can easily be tailored to fit almost any budget. I strongly believe that a $100 million investment would increase global sales no less than $2 billion. For scalable reasons the final budget is based off $50 million)

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Table of Contents

Section 1: Executive Summary 2

Section 2: Target Market Analysis 4

Industry Supportive & Unshakable Facts Market Metrics Demographics Psychographics Off-Line Behavior On-Line Behavior

Section 3: Competitive Analysis 7

Off-Line Competition On-Line Competition

Section 4: Marketing Plan 8

Off-Line Marketing Plano Creative Strategy o Advertising & Traffic Drivers

On-Line Marketing Plano Creative Strategyo Advertising & Traffic Drivers o 5 Social Media Tactics from Text

Metrics of Success 11 Budget 12

Section 5: Legal & Closing Statements 13

Legal Closing Statements

End Notes 14

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Section 2: Target Market Analysis

Industry Supportive & Unshakable Facts(all information below attained from http://researchwikis.com/Sports_Drink_Market)

2006 Sports Drink Industry Break Down2

$300 billion sales worldwide in 2005 Market increased 10% to 9.71 million liters in 2005 North America accounted for roughly 49% consumption in 2005 Asia Pacific region accounted for a 38% share in global consumption in 2005 Japan ranked second to the U.S. in terms of per capita consumption, but China is assumed to overtake

Japan as Asia Pacific's leading consumer by volume in year 2010 2003, Germany was the leading market for sports drinks in Western Europe followed by Italy then the

U.K.

Market Metrics (all information below attained from http://researchwikis.com/Sports_Drink_Market)

Global functional drink volume (millions of liters)

CATEGORY 2006 FORECAST 2011

SPORTS DRINKS 9,870.6 13,301.70 ENERGY DRINKS 2,429.4 3,534.10 ELIXIRS 320.7 366.10

TOTAL 12,620.7 17,201.9

(Source: Euromonitor International, 2007)

Sports Beverage Market

Wholesale Dollars (in US billion)

1997 $1.48 1998 $1.69 1999 $1.87 2000 $2.01 2001 $2.18 2002 $2.41

(Source: “Closing the gap?” Beverage World, January 15, 2003)

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2006 Market Share % Based on Sales (in billions)

Demographics

The characteristics of this section are very crucial to properly segment the market and determine where these traits fall in a SWOT analysis. Furthermore, the following information breaks down the market.

General Facts from: http://usa.usembassy.de/sports-youth.htm

“In 2003, 58 percent of boys and 51 percent of girls in high school played on a sports team.” “About $1 billion in athletic scholarships are awarded through the National Collegiate Athletic

Association (NCAA) each year. Over 126,000 student-athletes receive either a partial or a full athletic scholarship.”

Soccer Facts from: http://usa.usembassy.de/sports-soccer.htm

“Soccer is the most popular women's sport in college. An estimated 18,188 women played soccer in the three college divisions in 2001, compared with 17,788 in track and field. In some cases, women soccer stars are more well-known than men.”

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“Of the 18 million Americans who play soccer, 78% are under the age of eighteen. In the 1990s, soccer was recognized as the fastest-growing college and high school sport in the United States.”

“The 300,000 soccer clubs worldwide are comprised of 240 million players, 30 million of which are women.”3

Football Facts from:http://blogs.loc.gov/inside_adams/2010/01/college-football-season-is-almost-over-but-before-we-bid-it-adieu/

“In 1985 there were 509 football teams in the NCAA and in 2008 the number had grown to 628 teams. During this same period of time attendance at these games increased by about 40% from 34,952,000 in 1985 to 48,839,000 in 2008.”

Golf Facts from: http://www.loc.gov/rr/business/BERA/issue3/golf.html

“For the amateurs, participation in golf has been increasing since 1985. In 1985 there were approximately 17 million golfers in the U.S. playing over 414 million rounds of golf, at over 12,000 facilities. By 2003 the numbers had climbed to over 27 million golfers playing almost half a million rounds, at almost 16,000 facilities.”

Tennis Facts from: http://www.loc.gov/rr/business/BERA/issue3/tennis.html

“A breakdown of the figures by gender shows that in 2002 the number of men playing was just over 6 million, compared to almost 5 million women players.”

Athletic franchises to whom Product will be targeted: (highlighted Yellow = future targets)

a. Soccer - MLS f. Track & Field – Collegiate Levelb. Baseball - MLB g. Tennis – Collegiate Level c. Football - NFL h. Lacrosse - MLLd. Basketball - NBA i. Hockey - NHLe. Nascar j. Bassmaster

Psychographics

Physical Activity Healthy Products Modern Supplement Relevant Merchandise Athletes

o Ages from 5to 50o Jr. High o High Schoolo Club Sportso Collegiate o Minor Leagueo Professional o Hobby

They enjoy sports They train/ workout regularly Hard Working

3 http://www.loc.gov/rr/business/BERA/issue3/soccer.html6

Push the limit of the human body every day Come from all across the world Have passion Have love Intense workouts

Off-Line Behavior

Team Orientated – School, Professional, etc. Look to satisfy needs:

o Hydrationo Natural Energyo An alternative to water, which is perceived as blando Healthy option for “re-fueling” during physical activity

Require large amounts of fluid intake Younger, venturesome, and recreational Their off line behavior reflects the psychographics we characterize them under They live a very busy life style, constantly working, training and being active Travel very heavily especially when athletes get older

On-Line Behavior

Reliant on peers for information Heavy users of social media Appeal to loyalty/rewards programs More convenience oriented Stay up to date with sports Avid ESPN viewers Watch several sports videos The majority have smart phones to stay constantly updated since they are always on the go

Section 3: Competitive Analysis

Both online and offline competition have numerous players. However, the different products and brands serve different target markets. Energy drinks can be a competitor but there are only two main competitors in this industry, Gatorade and PowerAde. The other products and brands throughout the entire sports drink industry pose as threats. Starburst Performance targets the same athletes that PowerAde and Gatorade do. Hydration and nutrition during training/competition is crucial. Athletes do not consume energy drinks during training or competition.

Off-Line Competition

Pepsi, Co.o Gatorade

Coca-Colao PowerAde

Rockstar Accelerade Endurox Vitamin Water

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Propel Sobe Life Water Staminade

On-Line Competition

Pepsi, Co.o Gatorade o Sports ‘G’ Series

Go Fast Sports Red Bull America Monster 5-Hour Energy Clif Quench Coca Cola

o PowerAdeo Rock Star

Section 4: Marketing Plan

Off-Line Marketing Plan

The offline strategy is very unique its own way. Despite all the objectives and goals listed below, the most crucial phase of the entire marketing plan is to make endorsements with 1 male and 1 female professional athlete. Furthermore, sponsorship of some professional teams and colleges/university sports needs to be executed. This will allow immediate market penetration along with marketing to thousands of spectators and athletes. This will also increase traffic to Mars and Starburst Performance online. (Refer to marketing budget for break down & allocation)

Sales Force: Compiled of the company’s best sales people In charge of:

o Distribution of sampleso University relations/sellingo Professional team liaisonso Traveling up to 70% of the time

Crucial Note

There is one severe element that cannot go unaddressed. All of Mars’s TV commercials are outsourced to a marketing firm called BBDO Worldwide (www.bbdo.com).4 The issue is a conflict of interest on BBDO’s behalf if Mars chooses BBDO to design and launch commercials for Starburst Performance. BBDO also creates, designs, and launches all of Pepsi’s commercials. Top executives would have to make some decisions regarding their marketing services.

Creative Strategy

Objectives Launch Starburst Performance TV commercials in 5 international regions Launch a Mars TV commercial in U.S.

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o Synergize all brands while associating them with Marso Highlight all the GOOD that Mars has done since its beginning

Own the largest solar grid in the U.S. Charity Donations Mars’s 5 Principles5

Quality Responsibility Mutuality Efficiency Freedom

Awards

Goals Starburst Performance ($500,000,000 in first year sales) Increase overall sales of the company by 20% Increase each brand’s sales by at least 3% world wide Generate Starburst Performance sales in 5 countries within first year

o U.S.o Chinao U.Ko Russiao Australia

Advertising & Traffic Drivers

On-Line Marketing Plan

After examining the entire Mars online presence, we have concluded some effective changes need to be made in order to create synergy throughout the entire organization. Mars has a corporate web site and a separate web site for each product. We want to create correlation between the product websites and Mars.com.

E-Commerce Team: This team will be responsible for all online activity including websites, web design, analytics, tracking,

trends and implementing social media tactics Responsible for all language translations

Creative Strategy

Objectives Synchronize all online presence for quicker publication Drive all traffic to the corporate web site Increase presence and brand association to Mars and all of their products Create a YouTube, Facebook and Twitter page for Starburst Performance

Goals Increase each brand’s sales by at least 3% world wide Generate a total 1,000,000 hits per day to the corporate website Generate no less than 300,000 hits per day for Starburst Performance Increase brand awareness and loyalty for all Mars Products

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Advertising & Traffic Drivers

All traffic drivers will include Google Business Solutions.6 Some of the services they offer for professionals and their companies are listed below.

Ad Words Ad Sense Analytics Website Optimizer

These business solutions will allow Mars and their brand websites to increase search engine optimization globally. Google’s Business Solutions will also allow us to measure all online traffic. Aspects that will be measured include:

Stickiness Conversion Rates Average Time on Site Brand Awareness Referring sites Geographical Areas

Accurately measuring these areas and studying our target audience will increase future marketing budgets’ efficiency through allocating marketing dollars respectively to regions that are generating sales.

5 Social Media Tactics

Mars already has social media presence on Facebook and YouTube.

Tactics1. Facebook

Each brand/product has their own Facebook page As far as we know they do not participate in Facebook Ads

2. YouTube Mars already has product commercials on YouTube We plan on making all of our TV commercials available for view on YouTube We will not spend money on advertising on YouTube such as: commercials before videos start or

pop up ads during videos

3. My Space will not be a part of our online campaign

4. Twitter Design Starburst Performance Twitter page. Fans can follow and receive instant news and updates when on the go

5. Mars.com (Corporate Website) Offer RSS feeds for fans These feeds will allow others to get the latest news and product info through e-mail, mobile devices

and/or your e-mail home page

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Metrics of Success

Professional Team sponsorships University Sponsorships 2 Professional Athlete Endorsements

o 1 Maleo 1 Female

Saturated Online Advertising Targeted Sports Advertising

o TV Commercials E-commerce Team Sales Force Mars’s international presence

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Budget

Marketing Campaign BudgetMars / Starburst Performance

Total Budget: $ 50 MillionProfessional Athlete

SponsorshipMale $ 7,500,000

Female $ 5,500,000 Total: $ 13,000,000

University SponsorshipUniv. of Texas $ 2,500,000

Penn. State $ 2,500,000 Univ. of So. Cal. $ 2,500,000

Univ. of Conn. $ 2,500,000 Total: $ 10,000,000

Professonal Team Sponsorship

MLBTexas Rangers $ 3,000,000

NFL- Arizona Cardinals $ 3,000,000 Dallas Cowboys $ 3,000,000

MLSN.E. Revolution $ 2,000,000

Chicago Fire $ 2,000,000 Portland Timbers $ 2,000,000

U.K Rugby England Elite $ 2,500,000

English Premier League ? Depending on LawsAustralia – Rugby

National Team $ 2,500,000 Total: $ 20,000,000

SamplesUniversities $ 1,000,000

High-Schools $ 1,000,000 Total: $ 2,000,000

T.V. - :30spotU.S. - Starburst Comm. $ 450,000

U.S. - Mars Comm. $ 350,000 China Comm. $ 400,000

Russia Comm. $ 400,000 U.K. Comm. $ 400,000

Australia Comm. $ 500,000 Total: $ 2,500,000

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Operations Expenses

Sales Team $ 1,000,000 Preferably more allocation

Travel Costs $ 500,000 E - Commerce Team $ 1,000,000

Total: $ 2,500,000

Total Budget: $ 50,000,000

Section 5: Legal & Closing Statements

Legal

All the issues that we can think of are listed below. The entire plan needs to go through the legal department since this area is not our specialty.

Make decision regarding BBDO’s conflict of interests Endorsement contracts College/University Sponsorships Copy Right Issues Patents Nutrition USDA FDA Marketing Laws on an International Level for every targeted geographical country

Closing Statements

The concept and purpose of the Starburst Performance drink launch is to enter into a new market of manufacturing but targeting most of the existing consumers but gaining new consumers that use Mars products. This market only has two competitors: Gatorade and PowerAde, that compete for the same target market but no attempt has been made to threaten their market share, until now. Selective reasons are listed below. Starburst Sports Drink

- Enormous market and opportunity - 2 competitors: Gatorade and PowerAde - Gatorade does not have money or resources to compete with Mars or the Mars family regarding cash - Low manufacturing investment - Product distribution partnership with Budweiser

Divisions throughout the entire organization should be synchronized with the brand vision and teams. Divisions should consist of members from top management, R&D, legal, finance, accounting, engineering, sales and marketing. After all representatives are present, a full business plan and product life cycle needs to be constructed in accordance with a TOA (Team Operating Agreement), which sets forth dead lines, weekly agenda schedules and expectations. If agreed upon, every division needs to have goals, strategies, budgets and schedules to make this launch profitable and increase sales for all brands. Synergy is the key to this plan!

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.End Notes

2 http://researchwikis.com/Sports_Drink_Market4 http://www.bbdo.com/worldwide5 http://www.mars.com/global/the-five-principles.aspx6 http://www.google.com/intl/en_us/services/index_con.html

Disclosure

Cited sources in this proposal are considered accurate and unbiased figures. However, the budget presented is based on reasonable estimates with some room of fluctuations due to limited accessibility with year to date market information

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