Background: Monster energy drink owned by Hansen Natural Co.

Hansen started in 1930s, in 1970s Hansens developed and marketed a variety of natural sodas and pasteurized, shelf-stable soda, and 100% juices. Hansen went public with the name HANS in 1995, and Hans released monster energy drink in 2002. Hansen is a listed company of corona, California. Hansen natural co. announced a distribution agreement with Anheuser Busch in the U.S. and Group Jumex in Mexico. It has a deal with pepsico Canada started in Feb 2007. Production oriented: Production concept is one of the oldest methods. Managers of the production oriented company believe in high production efficiency, at low cost and maximum utilization of resources. This applicable to countries like china, where resources are very cheap. For example Lenovo and domestic appliances giant Haier take advantage of cheap low cost labor, mangers also apply this concept when company wants to expand. This concept holds that consumers will prefer products that are widely available and inexpensive. (Kotler MM) its a thought from capitalism to the mid 1950s, and still in some industries it exist, businesses primarly concerned with the issues of efficiency, production issues. In other words supply creates its own demand, if some one makes a product, so0mebody else will want to buy it, Philip Kotler argues that assembly-line techniques have
migrated to services like government benefits offices, in which they deal with people very efficiently, but without necessarily entailing full satisfaction on the part of the customer. Source: Marketing Management: Analysis, Planning, Implementation and Control, Philip Kotler, Prentice Hall, 1997

Product orientation: In product concept businesses makes superior quality products, product concept believes that customers prefer quality and innovative products. Sometimes managers only concentrates on the making improvements to the products, but its not successful until properly marketed, distributed and advertised.

Its an approach to businesses that concentrates its activities on continually improving and refining its products. All efforts are put into making the product better

Sales orientation: in this selling concept organization managers believes in aggressive selling and promotion effort. According to Serigo Zyman, Coca-colas former vice president of marketing, selling concept is the purpose of marketing is to sell more stuff to more people more often for more money in order to make more profit. Selling concept mostly applied to unsought goods, goods that are customers not thinking to buy like insurance, water purifiers, encyclopedias, etc. (kotler MM) Sales orientation became important as firms are beliving that they are not selling enough of their products, hence they focused predominantly on sale and seeling process or techniques, as a result these organizations operate as sales oriented companies. A sales orientation company concentrate higly on selling , low on customer needs and wants. Marketing orientation: Marketing orientation is an approach to business that centers its whole activities on satisfying the needs and wants of the Customers. In marketing orientation company, organizations follows a customer centric approach, its activities mainly focuses on the customer rather than the production or marketing departments. In marketing oriented company firstly company gets knowledge about the customer need and wants, after successful collection of knowledge about the customer, these information shared by all departments, and this process continues every time they come into contact with that customer. Kohli and Jaworski(1990) define market orientation in terms of three dimensions: 1. The generation of market information about the needs of customers and external environmental factors

2. The dissemination of such information among organisational departments 3. The development and implementation of strategies based upon this information Marketing orientation consists of following steps in satisfying the customer needs and wants, David Jobber clearly explained how a firm can meet needs of a customer through marketing orientation.

CUSTOMER
Marketing orientation 4 steps( Source: DAVID JOBBER principals of marketing)

From product-centered, make-and-sell philosophy, business shifted to a customer centered, sense and respond philosophy. Companys job is not to find the right customers for your product, but to find the right products for your customers. For example dell computers doesnt build a standard model for its customers, rather it

provides customization option to its customers. Selling focuses on the need of seller, marketing on the needs of the buyer. Selling is pre occupied with the sellers need to convert his product into cash, marketing with idea of satisfying the needs of the consumer by means of the product and the whole cluster of things associated with creating, delivering and finally consuming it1 .

Product Description: Monster energy drink is owned by the Hansen Natural Co. it has different flavors like monster energy, absolutely zero,lo-card, assault, khoas, mixed , etc. Marketing Mix: Monster Energy drink built a strong brand in energy drink industry, it pay close attention to the competitors anticipating its competitors moves. Monster energy drinks have become a very popular, it being considered as hip part of society, but the market that monster aimed not so diverse, wide. In early stages of monster is sold in U.S, they primarly targeted the athlets, this shows its mainly concentrated on consumers with the special set of interests. But now energy drinks market expanded to teenagers, youth , over worked life styles, as a result energy drinks targets this communities for promotion, companies are very specific in targeting specific communities, monster concentrates on sponsoring sports, extreme sports, bands, hip-hop crowd, it designing and packaging part also targets some specific group, but in future its expected it occupies more segments. The monster energy Distributed by monster Beverages Co., it uses strong promotion strategies including product hand outs by young vendors in powerful trucks with blasting music are common ways, the company promotes its drinks using Ricky carmichal, a motocross legend, to endorse their product, other effective advertisements include using high contrast, recognizable posters in retail stores and high energy, adrenaline rushed tv ads, called concentrated marketing, this type of marketing is have its advantages like concentration of resources, better meeting of

customer needs, and strong positioning, and disadvantages are small and change in segments. MARKET SHARES Hansen 90% revenues are from monster energy drink, remaining 10% are high quality healthy juices, sodas, teas, and other energy drinks. Hansen natural is the biggest energy drink company in US with sales of more than $1.3 billion in 2009, red bull had energy drink market share of 40% and monster had 29% of energy drink market share. The energy drinks sector is the fastest growing in the beverage industry and "alternative" beverage market sales in 2009 were approximately $29.9 billion in 2009. Led by its Monster energy drink brand, the firm has generated impressive growth since 2004. In 2009, the company posted revenues of $1.3 billion, a 10.7% increase from 2008; net earnings jumped 93.2% to $208.7 million. Beverage industry is highly competitive industry. Hansen competes in both soft drink and energy drink segments. Following are market share of top 5 beverage companys in 2009. 2009 Company Coca-Cola Company (KO) Pepsico (PEP) Dr 3 4 5 6 Snapple (DPS) Cott (COT) National Beverage (FIZ) 4.9 2.7 4.7 2.6 0.8 0.2 0.1 0.1 461 254 88 3.0 2.7 +11 Pepper Group 16.4 15.3 1.1 1,541 4.8 Market Share 41.9 29.9 2008 Market Share 42.7 30.8

2009 Rank 1 2

Share

2009 Cases Volume % Change (-3.9) (-5.0)

Change (millions) (-0.8) (-0.9) 3,947 2,815

Hansen Natural 0.9

Market shares of top 5 beverage companies(source: Wikiinvest.com/stock/Hansen_natural_(HANS))

Energy drink market share of top 5 companies are shown below, the only company redbull is ahead in its market share with 42.6% and Hansen natural had 29%, Hansen energy drink sales are continusly increasing every year.

Top 5 Energy Drinks by 2010 Market Share Ra nk 1 2 3 4 5 Energy Drink Monster Rockstar Full Throttle AMP Parent Company Hansen Natural Privately Held Coca-Cola Company (KO) Pepsico (PEP) Market Share 42.6% 29% 11.4% 6.9% 3.6%

Red Bull Privately Held

Market shares of top 5 energy drink companies(source: Wikiinvest.com/stock/Hansen_natural_(HANS))

The volumes sold by the Hansen are in increasing trend, it sold more then 100000 cans at a avg case price of $10. Its expected the trend continues in following years, and monster energy drink slowly capturing the market share of redbull, which is a worry to redbull. Monster performed very well in year 2010. And the trend continued in 2011 Q1 because of its promotional strategies.

Analysis: Monster is a marketing oriented company, it believes in creating, communicating and delivering value. It understood the customer requirements and produced best product to satisfy the customers. Its promotions and campaigns are very effective. Its sales are continually in upward trend. It achieved biggest market share after redbull.

1. Kotler marketing management (13th edition). 2. monster energy drink target audience and company wikiinvest.com