Marketing Campaign Case Studies

Tuesday, August 12, 2008


After an upturn in its fortunes in the highly competitive soft-drink industry, in 1997 Dr Pepper/Seven Up Inc., a subsidiary of Cadbury Schweppes, reigned as the leading noncola soft-drink business in North America. Its spicy beverage Dr Pepper was the third-best-selling noncola soft drink in America and was outsold only by PepsiCo’s Mountain Dew and the Coca-Cola Company’s Sprite. Analysts within the soft-drink industry attributed Dr Pepper’s success partly to its unrivaled position as the leading spicy soft drink. In contrast, Dr Pepper’s sister brand 7 UP was competing against other successful lemon-lime soft drinks, such as Sprite. Dr Pepper had been advertising with the cumbersome tagline ‘‘Now Is the Time. This Is the Place. Dr Pepper, This Is the Taste.’’ In an effort to continue its sales growth and streamline its previous tagline, Dr Pepper/Seven Up released a campaign called ‘‘This Is the Taste.’’ The ad agency Young & Rubicam created ‘‘This Is the Taste’’ with Dr Pepper’s estimated $55 million advertising budget. The campaign, which consisted of print ads and television spots, debuted on January 1, 1998, with four commercials that emphasized the unique flavor of Dr Pepper. Young & Rubicam conceived commercials that attempted to ‘‘deliver [this] hard-hitting claim in a humorous way,’’ John Swan, an agency partner, explained to Adweek. One of the spots depicted John Madden, a former National Football League (NFL) coach, searching a deserted stadium trying to find the elusive meaning of the game. His journey ended in success at a Dr Pepper vending machine. The campaign continued into 1999 with soccer-themed commercials featuring American and Mexican athletes. All spots closed with the ‘‘This Is the Taste’’ slogan. The campaign ended January 1, 2000.
‘‘This Is the Taste’’ was proclaimed a success by both Dr Pepper and industry experts. In 1999 Dr Pepper’s sales grew at a faster rate than that of the overall softdrink industry. The campaign’s final year marked the 15th consecutive year of sales growth for Dr Pepper.

Founded in 1885, Dr Pepper was the oldest of the major soft-drink brands in the United States. But despite its distinctive taste, the beverage had never achieved the mass acceptance of Coca-Cola or Pepsi. For most of its history Dr Pepper’s advertising had tried to make a virtue of this outsider image. After billing itself as the ‘‘most original soft drink ever’’ for much of the 1970s, the company switched to the funky and popular ‘‘Be a Pepper’’ campaign in 1977. Following the conclusion of its ‘‘Hold Out for Out-Of-the-Ordinary’’ campaign in 1987, Dr Pepper was the fifth-best-selling soft drink in the country. ‘‘We’re pretty comfortable with the idea that consumers know we’re different,’’ a company spokesperson told USA Today.
Dr Pepper’s uniqueness was again to be a significant asset during the 1990s. Beginning in 1990 Americans’ love affair with colas began to wane. According to the Wall Street Journal, the combined share of colas in the United States dropped from 72 percent in 1990 to 64 percent in 1996. In place of colas, consumers swilled ever greater amounts of so-called noncolas—primarily Dr Pepper, Mountain Dew, and Sprite. By 1995 Dr Pepper was the fourth most popular soft drink in the country, and its year-end sales were up 6.9 percent, far surpassing the remainder of the industry, which grew by only 3 percent. Despite this remarkable growth spurt, however, its two noncola counterparts, Sprite and Mountain Dew, outpaced Dr Pepper. After a year of record-breaking sales, Sprite displaced Dr Pepper as the leading noncola beverage in 1996, when its sales volume jumped 12 percent from 1995. Mountain Dew also performed well. In response, Dr Pepper created ‘‘Now Is the Time. This Is the Place. Dr Pepper, This Is the Taste,’’ to add momentum to the Dr Pepper brand. Nevertheless, while 1997 proved to be another growth year for Dr Pepper, Sprite and Mountain Dew continued to sell better. Prior to its inauguration of the 1998 ‘‘This Is the Taste’’ commercials, Dr Pepper possessed 5.8 percent of the domestic soft-drink market, while Mountain Dew and Sprite respectively controlled 6.3 percent and 6.2 shares. ‘‘We will only be content when Dr Pepper is growing at a faster rate than any other major soft drink,’’ promised Jack Kilduff, the company’s president, when he announced the marketing agenda for 1998.

To reach its ambitious goals, Dr Pepper needed to capture an essential demographic group. John Clarke, Dr Pepper’s chief advertising officer, told Adweek that the new spots targeted 12- to 34-year-olds. Especially important was the narrower market of teenagers within this broad group. Part of their significance lay in their sheer numbers. As the progeny of the massive baby-boomer generation, these members of the so-called Generation Y (or ‘‘echo-boomers’’) accounted for 28 percent of the American population. Moreover, these consumers, who were between the ages of 10 and 18, were rapacious softdrink guzzlers. For example, in 1993 alone teens spent $3 billion of their own money on soda, reported the newsweekly Time. Marketing a product to these echoboomers was a difficult proposition, however. They were, Time explained, ‘‘inoculated against pitches from having grown up with television jingles at breakfast.’’ Members of Generation Y not only commanded a greater spending power than any prior generation but also recognized that ‘‘their main area of [authority was] as a consumer,’’ said Time.
According to the Daily News Record, the most effective way to address this audience was to ‘‘under promise;’’ that is, to avoid the typical strategy of touting an inanimate product as the path to happiness or popularity. Generation Y-ers were far too media savvy to succumb to this questionable logic. Consequently, ‘‘This Is the Taste’’ avoided scenes of gorgeous young adults drinking Dr Pepper and suddenly enjoying newfound prowess or popularity. Instead the commercials focused on Dr Pepper’s taste and, as Brandweek noted, on ‘‘consumers’ undying devotion to the product.’’ Moreover, ‘‘This Is the Taste’’ retained the spirit of Dr Pepper’s long-standing quirky image advertising. This decision was grounded in the tendency of teens to rebel against the conventional and accepted. Dr Pepper’s spots did show people going to extreme lengths for a swig of the beverage, but these folks were presented as unique and unconventional, quite unlike the portraits of everyday, hardworking Americans who were the mainstay of many Coca-Cola campaigns. Of course, while it assiduously courted Generation Y, Dr Pepper did not want to alienate consumers over the age of 20. Unlike Pepsi’s campaigns, which had long sought to position that soft drink primarily as a youth brand, ‘‘This Is the Taste’’ strove to achieve a crossgenerational appeal. No scenes of screaming teens or smart-talking kids were used. Instead ‘‘This Is the Taste’’ relied on a tongue-in-cheek humor, catchy story lines, and an ensemble of characters that catered to adults as well as teens. For instance, John Madden’s presence provided the campaign with a means to connect with older consumers, as did a commercial released in December 1998 featuring the notoriously intense Bill Cowher, coach of the Pittsburgh Steelers NFL team. Because they did not resort to doling out the heavyhanded cynicism and obvious antiadvertising stance that was supposed to be popular among teenagers and their Generation X counterparts, ‘‘This Is the Taste’’ commercials had to be ‘‘more creative than ever to effectively convey our message,’’ Dr Pepper’s Clarke told Adweek.

Sprite and Mountain Dew, Dr Pepper’s foremost competitors, also strove to appeal to a youth market. Unlike Dr Pepper, though, both these brands more directly and unabashedly targeted Generation Y consumers. Sprite’s 1998 marketing effort stemmed from its parent company’s 1993 decision to end ‘‘I Like the Sprite in You,’’ a peppy campaign that mainly attempted to differentiate Sprite from its fellow lemon-lime beverage 7 UP. In its place Sprite and its ad agency, Lowe & Partners/SMS, developed ‘‘Image Is Nothing. Taste Is Everything. Obey Your Thirst,’’ a campaign that set its sights directly on Dr Pepper and Mountain Dew. As Lee Garfinkle, the chairman of Lowe & Partners, told Adweek on November 6, 1995, ‘‘the challenge was . . . to make Sprite relate to today’s kids and bring it into the ‘90s.’’ The way that ‘‘Obey Your Thirst’’ accomplished this aim was to ridicule the styles and fluffy messages of traditional softdrink commercials and instead cultivate a pronounced antiadvertising stance. The commercials used cuttingedge hip-hop music and scenes of teens skateboarding, skiing, and playing basketball. Although ‘‘Obey Your Thirst’’ incorporated celebrities, such as National Basketball Association (NBA) star Grant Hill, the spots derided the entire notion of using a celebrity endorser. One component commercial depicted Grant Hill stylishly dunking the ball on the court and then pausing to take a sip of Sprite. As a young boy watched him and followed his example, the voice-over declared, ‘‘If you want to make the NBA, practice. If you want a refreshing drink, obey your thirst. Sprite.’’ A company spokesperson explained the campaign’s strategy to Advertising Age in 1998: ‘‘The approach is that we’re not talking down to our audience. We know teens are smart enough. We know they know we’re selling them a product.’’ The brand’s sales increased immediately after the campaign’s launch. After becoming the fastest-growing soft drink in 1996, Advertising Age proclaimed that Sprite had ‘‘transcended the lemon-lime category to become a mainstream soft drink.’’ Its successes continued in 1997 as it garnered a 6.2 percent share of the soft-drink market. Mountain Dew reaped similar rewards from its strategy of targeting teenage boys. Created by BBDO Worldwide, its fast-paced commercials resembled music videos more than advertisements. Extreme athletes—representing sports that were tremendously popular with the echo-boomers, such as skateboarding and snowboarding—were a staple of Mountain Dew’s advertising. In one 1999 spot skateboarders raced along the tops of New York skyscrapers. In another spot scenes of extreme athletes crashing and falling off their skateboards, surfboards, and snowboards were set to the old folk tune ‘‘Dem Bones.’’ Mountain Dew aired a Super Bowl commercial in 1999 and was a prominent sponsor of the X-Games, an extreme sport extravaganza broadcast by ESPN. Like Sprite, Mountain Dew often adopted a more jaded outlook in its advertisements. Mountain Dew’s 1997 performance was even more outstanding than Sprite’s. It gained the distinction of being the fourth most popular soft drink that year and triumphed in ‘‘clever brand differentiation,’’ noted Advertising Age.

Dr Pepper had described its goal for ‘‘This Is the Taste’’ as that of ‘‘position[ing the brand] more as a leading soft drink rather than simply as the leading noncola soft drink,’’ Dr Pepper’s Clarke explained to the Dallas Morning News. The company viewed the campaign as its vehicle into the mainstream cola market. Although Dr Pepper was far less interested in claiming converts from Pepsi and Coke’s flagship colas, it did feel that by not billing itself exclusively as a fringe drink, it could cannibalize Sprite and Mountain Dew’s share of the market. Therefore, ‘‘This Is the Taste’’ was ‘‘more aggressive and more of a call to action,’’ said Clarke to the News. ‘‘We believe we’re as much of an icon to consumers as Coke or Pepsi.’’
Dr Pepper realized that establishing its brand in the mainstream of the soft-drink market would require a concentrated marketing push. Both in 1997 and 1998 Dr Pepper budgeted more to promote itself than it did in any prior advertising campaigns. The outlay in 1998, in fact, was 50 percent higher than in 1997. ‘‘This increased marketing investment will ensure greater consumer exposure to Dr Pepper in 1998 than ever before,’’ predicted Dr Pepper/Seven Up’s president. The company built upon the solid foundation laid in 1997 with ‘‘This Is the Taste’’ ads—which had appeared during high-profile events such as the NFL conference championships games. In 1998 Dr Pepper branched out and ran its commercials during new programming as well. Along with big-ticket sporting events, ‘‘This Is the Taste’’ spots ran during the Golden Globe Awards and Rosie O’Donnell’s talk show. In addition to its television spots, Dr Pepper used print ads. These did not share the images from the commercials but instead touted their own message. The company also sponsored a car in the NASCAR circuit in a bid to raise its visibility. ‘‘We’ve pulled together all the elements needed to propel Dr Pepper into the number one noncola soft drink position in the U.S.,’’ raved the company’s president at a bottler’s convention.
The campaign continued into 1999 with a January release of three 30-second TV commercials. Titled ‘‘Anthem,’’ ‘‘Latin,’’ and ‘‘Halftime,’’ they featured Americans and Mexicans playing soccer. The decision to tie Dr Pepper in with soccer melded with the agency’s decision in 1999 to advertise Dr Pepper’s international appeal. Although it was not the most popular sport in America, soccer was internationally referred to as ‘‘The World’s Favorite Pastime.’’
The campaign officially ended on January 1, 2000, when Young & Rubicam released the subsequent campaign, ‘‘Dr Pepper Makes the World Taste Better.’’
Clarke explained in the PR Newswire news service that the 2000 campaign made sense as the next step for Dr Pepper’s advertising. ‘‘Now, we’re going to provide the
answer to the logical question, ‘Why is Dr Pepper the taste,’ ’’ Clarke said. ‘‘Because no matter where you are, and no matter what you’re doing—a Dr Pepper will make life taste better. In fact, as our new tagline declares, ‘Dr Pepper Makes the World Taste Better.’ ’’

The noncola category of the soft-drink industry had another banner year in 1998. Dr Pepper sales rose 5.8 percent during the year. Nevertheless, Dr Pepper could not match the gains its rivals made. Mountain Dew catapulted past Diet Coke to become the thirdbest-selling soft drink, with its sales growing a stunning 9.9 percent in 1998. Sprite held onto its position as the number five beverage in the category, while Dr Pepper remained lodged in sixth place. In significant ways the company was hindered by its bottling and distribution systems. Because Dr Pepper/Seven Up owned no private bottling plants, it was dependent on independent operations or those controlled by Coca-Cola or Pepsi to perform this crucial step of moving the beverage from production to market. Moreover, its giant competitors had better distribution systems and more clout with retail and fast-food chains. Indeed, Dr Pepper/Seven Up was ‘‘in a tooth-and-nail struggle with larger rivals Coke and Pepsi for every inch of space it now occupies in supermarkets, convenience stores, soda fountains, and vending machines,’’ Brandweek asserted.
Despite these liabilities, Dr Pepper’s future looked bright. The noncola sector showed no signs of slowing, and the brand had a loyal following of consumers. In 1999 Cadbury Schweppes sold its non-U.S. DrEˆPepper business and several other brands to the Coca-Cola Company. Cadbury Schweppes also decided to merge its bottling plant, the Dr Pepper Bottling Company, with the Carlyle Group’s bottling plant American Bottling to form the consolidated Dr Pepper/Seven Up Bottling Group.
Dr Pepper executives attributed the brand’s increased sales growth to the ‘‘This Is the Taste’’ campaign along with the improved bottling. Dr Pepper sold 5 percent more cases than in the previous year—marking its 15th consecutive year of sales growth. The brand’s achievement was praised as ‘‘a phenomenon’’ by John Sicher, the publisher and editor of the industry newsletter Beverage Digest. Because of Dr Pepper’s lack of competitors, Sicher referred to the drink as ‘‘an unstoppable freight train.’’ Dr Pepper was the third-fastest-growing U.S. soft-drink brand in 1999, surpassed only by Mountain Dew and Sprite. Unfortunately for Dr Pepper/Seven Up, the company’s second-largest brand, 7 UP, recorded a 3 percent sales decline the same year.

No comments: