1. Executive Summary .......................................................................................................................1 2. Client Brief ......................................................................................................................................2 3. J&M Consulting Team ....................................................................................................................3 4. Why J&M Consulting? ....................................................................................................................3 5. Segmentation Question ................................................................................................................4 6. Market Definition ..........................................................................................................................4-5 7. Base of Segmentation ...................................................................................................................6 8. Secondary Research Methods ....................................................................................................7 9. Primary Research Methods ........................................................................................................7-9 10. Secondary Research Findings ................................................................................................10-12 11. Primary Research Findings ....................................................................................................12-15 12. Segment Profiles .....................................................................................................................16-21 12.1 Quality Quinn .................................................................................................................16 12.2 Quality Quinn in Kent State ..........................................................................................17 12.3 Price Tag Polly ................................................................................................................18 12.4 Price Tag Polly in Kent State .........................................................................................19 12.5 Active Anthony ...............................................................................................................20 12.5 Active Anthony in Kent State ........................................................................................21 13. Assessment of Segment Attractiveness ...............................................................................22-23 14. How to Reach Attractive Segments .......................................................................................24-25 14.1 Targeting Active Anthony ..............................................................................................24 14.2 Targeting Active Anthony in Kent State .......................................................................24 14.3 Targeting Price Tag Polly ...............................................................................................25 14.4 Targeting Price Tag Polly in Kent State ........................................................................25 15. Final Recommendations ............................................................................................................26 16. References ...............................................................................................................................27-28 17. Appendix ..................................................................................................................................29-46 i
Table of Contents
Figure 1.1 Millennial Population By County ...................................................................4 Figure 1.2 Enrollment In A Four Year College by County ..............................................5 Table 1.1 Bases of Segmentation ...................................................................................6 Figure 2.1 Platforms Millennials Post Products On .....................................................14 Figure 2.2 Platforms That Influence Purchase Decisions ...........................................14 Figure 2.3 Overall Perception of pH...............................................................................14 Figure 3.1 Quality Quinn .................................................................................................16 Figure 3.2 What is pH? Quality Quinn ...........................................................................17 Figure 4.1 Price Tag Polly ................................................................................................18 Figure 4.2 What is pH? Price Tag Polly ...........................................................................19 Figure 5.1 Active Anthony ...............................................................................................20 Figure 5.2 What is pH? Active Anthony ..........................................................................21 Figure 6.1 Average Attractiveness for Each Segment ..................................................22 Figure 6.2 Count of Each Segment .................................................................................22 ii
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Tables and Figures
PepsiCo is looking to effectively reach millennials in Northeast Ohio with their hydration products. Our secondary research determined that most millennials in The United States reside at colleges. With 26,916 millennial students, Kent State University had the largest millennial population in Northeast Ohio, making it a good representation of the millennial outlook within the hydration industry. J&M Consulting used multiple databases such as Social Explorer, Mintel, and Amazon Reviews to discover information about millennials. We found they have glance and buy habits, they want to receive more but pay less, and they need to clearly see and understand the health benefits of a product. Using primary research methods such as focus groups, personal interviews, and a survey, we found millennials’ use of social media, how they interact with ads, and their thoughts and preferences on hydration products. We then used our survey data to segment the market into distinctive groups, so we could target more effectively. Our bases of segmentation were benefits desired for hydration products and social media usage. This resulted in a total of 10 segments, we then narrowed them down to the best 2 segments based on attractiveness and potential market size. These segments were Price Tag Polly, a price sensitive consumer, and Active Anthony, a health conscious consumer. Price Tag Pollys are typical college millennials always trying to find a deal. They hold a 30% potential market size. Active Anthonys are millennials who are concerned with what they are putting in their body and hold a 53% potential market size. J&M Consulting found that the best way to attract Price Tag Polly in Northeast Ohio is to run a social media campaign with occasional prizes. To target this segment at Kent State, consumers would be encouraged to post hydration products on the Kent State Snapchat Story to earn Pepsi rewards. Thus, creating product “buzz” around campus. Our team found the best way to target Active Anthony is through PepsiCo's flagship hydration product, LifeWTR. To target these consumers in Northeast Ohio in general, samples should be sent to influential health conscious social media users, to spread the word about LifeWTR’s benefits to their loyal followers. To target at Kent State, a Snapchat filter advertising LifeWTR would be exclusively available near the Recreational Center. This will get consumers talking and product awareness among health conscious consumers that could spread the word about LifeWTR beyond the campus limits. 1
Executive Summary
PepsiCo is an American multinational food, snack, and beverage corporation. Founded in Delaware in 1898 by Donald M. Kendall and Herman Lay. With the headquarters currently in Purchase, New York, PepsiCo focuses on the manufacturing, marketing, and distribution of food, beverages, and other alike products. PepsiCo is currently #44 on the Fortune 500 list and #127 on the Global 500 list, as well as #39 on the World’s Most Admired Companies list for 2017. In the early to middle 90’s Pepsi began to expand from carbonated beverages and into the hydration market. After introduction, the hydration category has recognized double-digit growth volume. Even now with a firm base, hydration is still growing by 10% continuously. Pepsi was late to the bottled water industry but had a competitive advantage with their already established infrastructure. Pepsi is constantly working to get the product to the customer in the most convenient way possible. Due to sugar-related concerns In 2016, Bottled water Consumption overtook Soda Consumption. After the fall of carbonated products, the amount of Coca-Cola consumed dropped 1% by volume and the amount of Pepsi-Cola consumption dropped by 3.4% by volume. During the fall in carbonated products, there was a growth in Pepsi's hydration brand, Gatorade. Gatorade's volume increased by 6.1% in the liquid refreshment beverage category in 2015. Due to the popular increase in non-carbonated beverages and to keep up with competition Pepsi has decided to roll out a multitude of hydration products in 2017. 2
Client Brief
Name: Jillian Bucci Favorite Pepsi Hydration Product: LIFEWTR Favorite form of Social Media: Instagram
Name: Mike Price Favorite Pepsi Hydration Product: LIFEWTR Favorite form of Social Media: Snapchat
Name: Jim Huntley Favorite Pepsi Hydration Product: Gatorade Favorite form of Social Media: Snapchat
Name: James Donnelly Favorite Pepsi Hydration Product: Gatorade Favorite form of Social Media: Instagram
Why J&M?
Meet the Team
Upon our first time introducing ourselves we quickly realized that our names were all similar. Jillian, Mike, Michael, Jim, and Jimmy. When beginning our agency we began to over-complicate the naming process and then it became comically simple, thus the name J&M Consulting was born. When establishing our logo we began to brainstorm some words that described the way we would like to have people think of us when they hear the name J&M. Efficiency was the first word we thought of because it's a very important aspect of marketing especially with the ever changing trends in society. Reliable because reliability is crucial not only in marketing but also in everyday life. Innovative because we will always be working to come up with the greatest, advanced and original plans for the companies who trust us with their marketing needs. 3
Name: Mike Macek Favorite Pepsi Hydration Product: Aquafina Favorite form of Social Media: Instagram
When defining the market for Pepsi J&M began with Ohio then moved into Northeast Ohio. Northeast Ohio is made up of 13 counties. Through Social Explorer, we looked at the millennial population in those 13 counties to find a total millennial population of Northeast Ohio to be 815,418 people. A breakdown of the millennial population by county can be found in Figure 1.1.
PepsiCo is looking to effectively reach the millennial market with their hydration products in Northeastern Ohio. They have noticed a constant trend of carbonated soft drinks declining in popularity and a steady rise in demand for non-carbonated drinks. PepsiCo's main concern was to figure out where this hydration industry is going. Pepsi has realized the importance of millennials in this market and wanted to get a better understanding of how these consumers felt about hydration and how they should be attracting them.
Segmentation Question
Market Definition
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N= 815,418 Figure 1.1
Bases Of Segmentation
Our base of segmentation is the main variable that we looked at to separate the market into easily definable groups based on attractiveness. We can use these segments to filter out consumers that are not attractive to Pepsi and focus in on our target market. The two variables we used to create two different bases of segmentation were benefits desired and usage. The question that was used to derive benefits desired asked respondents to rank specific options in order from most important to least important when they purchased hydration products. Using that information, we were able to use that question as a base of segmentation to create 5 segments, which were: Quality, Loyalty, Price, Sustainability, and Health. We then wanted to define these segments further and decided to use our second base of segmentation, social media usage. To find this base of segmentation we averaged each respondent’s answers related to their feelings towards different social media platforms. This gave us an average overall feeling of how much each respondent uses social media. We categorized respondents into heavy and low social media users. If a respondent’s average score was less than or equal to a 2.59 then they were considered to be a heavy social media user and if they were greater than a 2.59 they were considered to be a low social media user. Bringing these two bases of segmentation together we now had 10 segments which were: Heavy Social Media and Quality, Heavy Social Media and Loyalty, Heavy Social Media and Price, Heavy Social Media and Sustainability, Heavy Social Media and Health, Low Social Media and Quality, Low Social Media and Loyalty, Low Social Media and Price, Low Social Media and Sustainability, and Low Social Media and Health. These ten segments can be easily seen below in Table 1.1.
Table 1.1
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These were our ten segments that emerged after using both bases of segmentation (benefits desired and social media usage). However, we quickly realized after combing through each segment that none of the low social media segments were going to be attractive for Pepsi. Therefore, we decided to ignore segments 6 through 10. This brought us back down to having 5 attractive segments for us to analyze further.
Base of Segmentation
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Secondary Research Methods
After our secondary research, we knew what our focus should be for our primary data collection. We wanted to collect the general behavior of millennials and how it correlated to the hydration industry. We knew that millennials are socially connected most of the time. We wanted to specifically see which platforms they like the most and their levels of usage. We looked at social media in relation to products. Do they post about the products they purchase? If they do, what platform are they posting on? How do these platforms influence millennials to buy products? Since sustainability is relevant to millennials, we wanted to see what specific kind is important. Is sustainability important when purchasing a product especially if price is a factor? Millennials' overall thoughts and preferences on hydration products and the specific reasons they purchase the products that they do.
Primary Research Methods
Our secondary data research methods consisted of database searches among, online magazines and online reviews. We used databases such as Mintel and Social Explorer along with numerous articles from the Kent State University Library. Through Mintel, we found information relevant to where the bottled water industry is going in the future. We were also able to find where millennials fall in the hydration industry and what impact they will have on it in the future. Mintel also allowed us to know where millennials stand in terms of health. The Social Explorer database played a major role when it came to finding information about the market definition. We were able to decipher an approximate market size for the Kent area along with Northeast Ohio. Through the articles, we discovered information about what millennials are looking for in products and how they make their purchase decisions. The online magazines we used as references are Affirm and Forbes. Through these two magazines, we found more information about millennials’ purchase decisions and recommendations on how to target them as well. Lastly, we used online reviews from Amazon in order to determine how millennial consumers view hydration products and what attributes they expect their products to have. Discussed later will be our major insights from our secondary research. The majority of this research extensively covered the size of the hydration industry as a whole and the growth rate of the industry as well. Our research was also directed toward competitors and what they provide to the hydration industry. Finally, our last insight from our secondary research was millennial behavior directed toward purchase behavior and their beliefs on advertisements and hydration in general.
The J&M Consulting team conducted 25 individual structured, personal interviews made up of 13 females and 12 males. These respondents were gathered using convenience sampling and attended Kent State University. These interviews took approximately 8 minutes each and they followed the same question structure as the focus group. Each interview was conducted using 1 moderator who also acted as the scribe and wrote down each respondent’s answers. The full interview protocol is located in the appendix.
Primary Research Methods: Interviews
On March 30th, 2017, J&M Consulting conducted 2 separate focus groups. Each focus group took about 25 minutes. Each focus group had one moderator that asked the questions and controlled the flow of the conversation. A copy of the interview protocol used is in the appendix. Additionally, there was one scribe present in the room that had all the questions in a document and typed out each respondent’s answers or comments. We also made sure to specify which respondent said what to ensure that each respondent’s entire message was recorded.
Primary Research Methods: Focus Groups
Focus group A consisted of 10 people, 6 females and 4 males. Participants were gathered through convenience sampling and their class standing ranged from sophomores to seniors. 4 members of the group lived on-campus while the remaining 6 lived just off campus. Focus group B consisted of 7 people, 2 females and 5 males. Again, these participants were gathered through convenience sampling and their class standing ranged from sophomores to seniors.
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The J&M Consulting team created and sent out an online survey through Qualtrics.com. This survey was created with our previous knowledge from our focus groups and interviews. We choose to dig deeper into the questions we uncovered in our previous primary research findings. This survey contained 27 questions and took approximately 4 minutes to complete. Respondents were gathered through convenience sampling. Our team sent out the survey multiple times via email and to class rosters. Therefore, all of our respondents were from Kent State Students. After leaving the survey open for 2 weeks we had gathered 165 respondents. However, some of these respondents did not complete the survey fully or were under the age of 18 and we were forced to disregard them from consideration. This left us with 124 qualified responses that we were able to look at. After closing the survey we exported the data into excel and began to analyze it. We found that there were 64 females and 60 Males that took our survey making it relatively close to having an equal representation of males and females. Questions that were asked to respondents were related to buying patterns, social media usage, attractiveness, sustainability, and opinions on various hydration products. These questions were then followed by some demographic questions so we could better understand who our respondents were. The complete survey is located in the appendix.
Primary Research Methods: Survey
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In the attempt to further define the market we thought about where most millennials reside, college. To support this idea with factual evidence we turned to the US Census, the census then confirmed our theory. The Census told us that 66% of the millennial population (between the ages of 18-27) attend a 4-year University. We then looked at all the 4 -year universities in Northeast Ohio and calculated their millennial enrollment totals (taking 66% of total enrollment) to get a market size of about 171,277 focusing on the 4 counties with the highest college enrollment (Figure 1.2).
Figure 1.2
After finding the original size of our market we decided to further our suggestions and create not only recommendations for 4 counties in Northeast Ohio but, also Kent Sate specifically. Our millennial market size for Kent Sate University totaled to 26,916.
Aquafina’s customer’s liked the taste, price point, stated it was clean and were typically loyal to the brand. Its competitor Deja Blue had reviews that stated it was sweet, crisp and cheap. Some people viewed Dasani as filtered tap water, but they were loyal, liked the taste and price. Nestle Pure Life had mixed feelings toward the bottle.
Essentia customers claimed that it hydrated them better, making them feel fuller. Generally made them feel better overall and some claimed it could help fend off sickness because of its anti-oxidizing properties.
Secondary Research Findings: Competition
People said it was flimsy and noisy, even though it was good tasting and very cost friendly. LifeWTR’s reviews showed that people liked the bottle design, thought it had a great taste, and liked the fact it was pH balance. Smart Water customers claimed to be loyal, loved the taste, and thought the electrolytes were a bonus. Fiji customers liked the taste, the fact that it was clean and from a natural spring. They also were loyal customers. Bai-Antiwater had quality concerns like mold in the bottles. Some people said they did not like the taste and claimed it had a soapy, alcoholic taste to it. The antioxidants benefit was also a plus.
J&M consultants broke down major competitors specifically by each product Pepsi offered. Aquafina’s competition was Dasani, Nestle, and Deja Blue. LifeWTR’s main competition is Coca-cola brand Smartwater followed by Fiji, Bai-Antiwater, and Essentia. Pact's competition was the Ice brand carbonated flavored water and FruitWater. Gatorade and Propel's major competitor is Powerade. Pepsi’s Sobe Lifewater is competing against Vitamin Water. The team examined Amazon reviews for Aquafina and LifeWTR since Aquafina is Pespi’s best seller and LifeWTR is their new flagship product.
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Secondary Research Findings: Millennial Behavior
Targeting these diverse millennials is much different than other generations. 84% do not believe or pay attention to traditional advertising. They associate advertisements with being unauthentic. When it comes to reading product or news related content they will only pay attention to companies, news sources, or websites they trust. If a company wants to gain their loyalty, active engagement with them is a must. When millennials reach out to companies via social media they want a response. when companies listen to their feedback involving consumers into the co-creating process attracts them to the product and brand even more.
Secondary Research Findings: Targeting Millennials
This behavior transfers to the products they purchase. They resort to social media for online reviews of products and see what is trending to dictate their purchase decisions. They are more concerned with products that fit their personal brand than the brand name of a product. 75% of millennials said it is important that a company is sustainable in some way. If a brand or product has a purpose behind it or a strong positive demeanor, they are more attracted to it. Although they are considered impulsive, they are very financially responsible. They will hunt for the best deal on products. Searching for the best possible deals on premium products is their specialty.
Key insights J&M consulting found when looking at Millennial’s overall behavior were that millennials are constantly searching for new and unique products that will allow them to post on social media boosting their “personal brand image”. Millennials are concerned with this concept of a “Fear of Missing Out” or “FOMO”. They seek to be actively engaged on social media and want to jump on the newest emerging trends. Since they are split second decision makers and often impulsive when it comes to being trendy and different. Often buying products whose packages grab their attention. They are excellent multitaskers. They can purchase products on the go while living their lives and constantly being connected online.
Secondary Research Findings: Purchase Behaviors
Secondary Research Findings: Industry Size
From our secondary data, we had an idea of what we wanted to find from our focus groups and personal interviews. From the two focus groups conducted, some specific insights that we gathered were: “When buying plain bottle water, I buy what is most convenient to me” Some people stated that they buy whatever is at eye level or grabs their attention. “PH balance does not mean much to me. I need to see the resulting health benefits to make it meaningful” “Sometimes when there is an advertisement before a video, I will not even watch the whole video because I don’t want to see the ad”· “I only pay attention to the ads I find interesting and they must be short”
Primary Research Findings: Focus Group
After reviewing various websites, magazines, and database articles, a few key insights were gathered. The hydration Industry is a $15 billion dollar industry. It is currently growing since there was a 6.4% increase in 2015. By 2020 projected sales are expected to grow by 35%. 66% of the flavor bottled water market and 93% of the unflavored bottled water market is made up of millennials.
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This is an example of native advertising through social media. A healthy chef with a heavy following posts an ad onto her feed blending in naturally amongst other posts
If something does not grab their attention and appeal to them right away, they lose interest and click right past forced advertisements. The participants said they like the native ads they find themselves on social media. The ones that aren’t directly trying to sell them something but are a part of an intriguing picture on Instagram or are posted by a personality they idolize.
When questioned on pH, some participants knew what it was but for reasons unrelated to bottled beverages. They also said it wouldn’t affect them when purchasing a product. The participants were asked the same structure of questions from the focus group. Every subject claimed they mostly use Instagram and Snapchat when it comes to most used social media. They stated that they ads on social media are extremely annoying. A few gave the example of when viewing their friends Snapchat Stories, an advertisement will pop up in the middle of it. A majority of participants claim they immediately click right through it or stop watching stories. We found that when ads are forced, millennials become frustrated and do not want to watch them. This ties in with interview participants admitting to having a low attention span.
Primary Research Findings: Interviews
N= 124 Figure 2.2
When questioned on overall perception of pH, the majority at 39% did not even know what pH was. 36% stated it was important, while 25% claimed it was not important to the them.
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When respondents were asked to list the top three hydration products that come to mind, Gatorade was the most popular followed by water, and then Powerade. Sports drinks and water are what millennials think of when it comes to their perception of hydration.
J&M consulting had 124 relevant survey respondents. From this sample, it was concluded that every respondent used at least one social media platform. The data was also broken down into levels of usage. Specifically, the portion who post the products they purchase. The most popular social media platform to post on was Snapchat, followed by Instagram, and then Twitter. (Figure 2.2) The platforms which influence their purchase decisions the most were Instagram, followed by Twitter and Snapchat. (Figure 2.2)
Primary Research Findings: Survey
N=124 Figure 2.1
N= 124 Figure 2.3
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When questioned about sustainability, 77% claimed to care about it. The three forms of sustainability they were questioned on were environmental, social, and economic. The most popular was for a company to be environmentally sustainable. 55% of the respondents claimed this was their main concern. However, when the price was a factor, 52% said they would not specifically pay more for the product because it was sustainable. J&M concluded that sustainability is important, but many millennials will not purchase a product when a higher price is involved mainly because they are more concerned with cost over sustainability factors. Respondents were questioned about buying patterns. If they are purchasing a higher-priced, premium product it is important to them that they understand the effects of the perceived health and quality to justify the higher price. When it comes to basic hydration products, such as non-premium bottled water, they grab whatever is available to them. The survey had respondents rate their overall attractiveness to not only Pepsi products, but also a list of competitor’s products. J&M consulting took the average of each respondent to specify their average level of attractiveness to each product. After being asked to rate their reason for attractiveness, it was possible to categorize them into one of the five bases of segmentation based on their average responses. The bases of segmentation were based on their attractiveness to Quality, Loyalty, Price, Sustainability, and Health when buying a hydration product.
Quality Quinn
About Quality Quinn
Figure 3.1
Quality Quinn is our segment that is concerned with the quality of the product when they’re making a purchase decision. Through our research we were able to find out what it really means to have a quality hydration product. It means that benefits and features are clearly represented on products. For example; pH, vitamins and/or minerals are labeled so the consumer can see what the product has to offer. We also found that this could be the structure of the product/bottle in terms of the quality of plastic used. This segment has to see these features because this will justify the higher price point of a premium hydration product. Quality Quinn does have a significant interest in the use of social media.
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This segment listens to trusted bloggers and friends that they follow on their social media platforms. They use Snapchat, Twitter, and Instagram in various ways to connect with companies they admire. We determined that 41% of this segment will post products that they purchase on social media. This segment posts the products that it purchases mainly on Snapchat and Twitter. However, Twitter and Instagram influence their purchase decisions the most. Quality Quinn is most likely to use hydration products when they are working out or when they are eating a meal.
We concluded that 47% of the millennials in this segment are aware and influenced by pH when purchasing hydration products. This equates to 11,271 millennials in Northeast Ohio and 1,771 at Kent State University. 24% of this segment was aware and uninfluenced by pH when purchasing a project, which equates to 5,755 millennials in Northeast Ohio and 904 at Kent State University. This left us with the knowledge that 29% of the segment was unaware of what pH was in general. In terms of millennials, this equates to 6,954 in Northeastern Ohio and 1,093 at Kent State University.
In Figure 3.2, we looked into if pH mattered to this segment and if it influenced their purchase decisions when buying a hydration product. This was determined when we asked, “Having a pH balanced water is important to me” in our survey. This allowed us to conclude that if the respondent was aware and influenced, aware and uninfluenced or completely unaware of what pH was as a whole.
Figure 3.2 N=124
Quality Quinn in Kent State
Price Tag Polly
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About Price Tag Polly
Price Tag Polly is our segment that was derived from heavy social media usage and being a price sensitive consumer. Price Tag Polly is also a “bandwagon” consumer which means that they might be willing to pay slightly more for a product if it follows a current trend. However, do not be fooled by this because these consumers will always try and find a deal when purchasing products.
Figure 4.1
Finally, 22% of the consumers in this segment which equates to 1,777 millennials at Kent State University and 11,304 millennials in Northeast Ohio are aware of what pH is and are actually influenced to purchase products because of the pH balance attribute.
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This segment’s social media behaviors consist of posting products that they have purchased on Instagram and Snapchat. They likely post in order to showcase a product that they purchased during a sale. Price Tag Polly can be influenced to purchase products because of what they see on social media, on platforms such as Instagram and Twitter, which are the two most influential platforms for this segment. We believe this to be true because they can see the influential people, such as celebrities or peers that they follow, using the products in pictures or videos. While using social media to find new products, they also use it for finding deals on items as well. They are more likely to buy a product if savings can be linked to it. Price Tag Polly typically purchases and uses hydration products when they are working out and when they are hungover.
Price Tag Polly in Kent State
Does pH balanced hydration matter to the Price Tag Polly segment? The answer to that is not really. Through our survey, we found that 54% of this segment which equates to 4,361 millennials at Kent State University and 27,747 millennials in Northeast Ohio are completely unaware of what pH is in general. While 24% of this segment which equates to 1,938 millennials at Kent State University and 12,332 millennials in Northeast Ohio are aware of what pH is but are not influenced to purchase hydration products because of pH balance.
Figure 4.2 N=124
Active Anthony is the segment that is concerned with the health benefits that a product is going to offer. This segment will pay more for a product when it appears to be healthier than the common hydration product. Once again this could be benefits such as a pH balanced product or one with vitamins and/or minerals. Active Anthony’s will be the segment that is willing to do more research on their products because they care mainly about the health aspect of it. Those that live a healthy lifestyle will influence them to try a product, for example, healthy chefs, athletes, and fitness models. This segment posts products on social media to relay information to their followers about the nutritional benefits of using the product. Also, this segment is going to commonly give a general review on the product informing followers about aspects such as taste or how it made them feel.
Active Anthony
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About Active Anthony
Figure 5.1
Active Anthony in Kent State
Figure 5.2 N=124
When using social media they will post majority of their products on Snapchat and Instagram. Active Anthony’s are going to be influenced the most to try a new product when they see ads on Twitter and Instagram. Active Anthony’s are going to use these products the most when they are working out or when they are eating a meal.
Breaking the segment down, we found that 40% were aware of pH and influenced by it when purchasing a product. This equates to 36,311 millennials in the Northeastern Ohio market and 5,707 in the Kent State market. While 26% that is 23,603 millennials in Northeastern Ohio and 3,709 at Kent State were aware but uninfluenced by pH. Educating this segment may need to be focused on for the consumers that are unaware of pH entirely. This is important to note because this segment is health conscious and this could be something that gets the segment to purchase more of the products that have a higher pH level. It was found that 34% of Active Anthony’s are unaware of pH, which equals 30,865 millennials in Northeastern Ohio and 4,851 at Kent State University. This is a significant amount of people that can be targeted and potentially influenced once they know the health benefits of pH.
Once again we looked to see if pH mattered to this segment and were able to better understand this segment’s understanding of pH. By looking at the chart you can determine that this segment does have knowledge of pH, however, there is still significant room to educate the segment on the benefits of pH.
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N=124 Figure 6.2
Assessment of Segment Attractiveness
Looking at (Figure 6.1), you can see that the Loyalty segment was most attractive at 4.5 followed by the Quality segment or by its other segment name, Quality Quinn at 4.3. The last three segments were similar in their average attractiveness scores. The Price segment, also known as Price Tag Polly, had a score of 3.9. The Sustainability segment had a score of 4, and the Health segment, also known as Active Anthony, had a score of 3.95. Looking at (Figure 6.2), the Count of Each Segment you can see the number of respondents that fell into each segment. There were 124 total respondents in this sample. The health segment, or Active Anthony, contains 66 people and has the largest potential market size at 53%. The next largest potential market size is the Price segment, or Price Tag Polly, containing 37 people giving it a potential market size of 30%. The quality segment, or Quality Quinn, contains 17 people and is third in relation to potential market size at 14%. The last two segments Loyalty and Sustainability both contain only 2 people giving then a potential market size of 1.5%.
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N=124 Figure 6.1
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When weighing each segment based on both of these figures we quickly saw which segments we could ignore. The Loyalty and Sustainability segments had a relatively high average attractiveness; however, their potential market size was too small to be overall attractive to Pepsi. Analyzing this further, the two largest segments in terms of potential market size, Health, and Price, had their average attractiveness score at .35 and .4 points lower respectively than the Quality segment’s attractiveness score. We believe that this small difference in their attractiveness score is overcome by the size of these segments. Although the Quality segment has a slightly higher attractiveness score, it is slightly under half the size of the Price segment and about one-fourth the size of the Health Segment. Therefore, we have decided to select our Health segment (Active Anthony) and our Price segment (Price Tag Polly) as our two most attractive segments for Pepsi to target. Looking at each of these segments willingness to pay for hydration products and the reasons behind their purchase decisions for water; J&M Consulting is proposing that Pepsi should market their flagship product, LifeWTR to the Active Anthony segment and they should market the fleet of hydration products to the Price Tag Polly segment. To determine which two segments are most attractive to target we had to measure these segments against each other. First, we focused on their potential market size and likelihood to purchase. The average level of attractiveness was found using a question in our survey. This question asked each respondent to rate their feeling towards multiple hydration products in this market on a scale of one, meaning they really dislike, to seven, meaning they really like (see appendix). We then took the average of their responses to determine their overall attraction towards the hydration industry. The count of each segment was found by looking at which segment each respondent fell into using each of our bases of segmentation, which were benefits desired and social media usage. We only looked at the segments that were associated with heavy social media usage because in both potential market size and attractiveness they were all more attractive segments than the low social media users. Additionally, the client Pepsi Co. expressed a strong interest in utilizing social media due to their focus on millennials.
We thought the most efficient way to reach Active Anthony to the general market of Northeast Ohio would be to send health-related social media influencer's samples of LifeWTR. Attached to these samples would be a small informative piece of print that would list the benefits of pH balanced water. These social media influencer's would be fitness models, healthy food blogs, and athletes with a large following and strong social media presence. They would then post native advertisements about LifeWTR portraying the health benefits to their loyal followers.
Targeting Active Anthony in Kent State
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To give a stronger idea on exactly how to reach Active Anthony in Kent State specifically, we developed a Snapchat filter that shows a bottle of LifeWTR and had a creative background. A Geo Filter was fenced around the Kent State Recreation Center and Ice Area. When students take a Snapchat at these locations, they will have access to the Snapchat filter. After unlocking the filter, they can then share it to their Snapchat Stories, making the filter viewable to all of their friends. This will allow active millennials on campus to correlate LifeWTR with being active.
Targeting Active Anthony
How to Reach Attractive Segments
The two segments we found to be important were the health conscious “Active Anthonys” and the price conscious “Price Tag Pollys”. When looking at LifeWTR specifically, Active Anthony is the most attractive with a 53% potential market size. These health-conscious consumers found this product more attractive. In order to successfully target this segment, there is an approach to attract them at Kent State specifically and then one not specific to Kent State.
To give an idea on how to specifically target this segment at Kent State we will be utilizing the already existing Kent State Snapchat Story. The Kent State Snapchat Story is accessible to anyone on or around Kent States Campus. If students post to this story with their favorite hydration product around Kent State, they will get a snap reply with a QR coupon code that will give them promotions for participating. A possible promotion could be, buy a hydration product and get one free when they scan the QR code at checkout. This will not only aid in creating deals to further attract Price Tag Polly but also create campus "buzz".
In order to reach Price Tag Polly would be to turn Pepsi's Hydration products into a Trend. A social media campaign to get hydration products trending is ideal. This would essentially be a sweepstakes that if someone posts a picture on Twitter or Instagram with a hydration product captured and uses the hash-tag #InspireThirst, they will be entered into a monthly drawing. The winner will be selected at random based off of their social media name, they will win free Pepsi products or memorabilia. When they enter into the monthly drawing, they are also eligible for the grand prize drawing that will be selected at year end. We suggest this grand prize would utilize Pepsi’s current partnerships with either the Super Bowl or their celebrity endorsers. Free tickets or meet and greats would be a great incentive to engage millennials socially.
Targeting Price Tag Polly
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Targeting Price Tag Polly in Kent State
In order to effectively reach the millennial market with Pepsi's Hydration Products advertisements used must be native. Millennials are not susceptible to forced advertisements. Reaching Millennials through social media is the most efficient way to reach all consumers. By implementing the previously proposed social media strategies not only will Pepsi be targeting the most attractive segments but also the millennial market as a whole. The Instagram and Twitter social media sweepstakes will not only create Native advertisements but would also turn Pepsi's hydration products into a trend. when consumers such as Price Tag Polly see their friends posting into the sweepstakes they will then be more inclined to learn more about Pepsi products and purchase them in order to enter. The monthly drawings will specifically reach Price Tag Polly because there is a chance for them to receive a deal. The recommended highly sought out grand prize will then give consumers and incentive to buy and post. The specific Snapchat Story campaign for Kent State University will create a buzz about Pepsi's hydration products. The proposed rewards sent to consumers will also give a chance for them to expand their product knowledge. Again, the high volume of posts on the Kent State Snapchat Story will not only advertise Pepsi's hydration products but also turn the fleet of Pepsi hydration into a trend. As previously stated millennials are influenced to buy based off of what their friends are posting about. The QR deals give them an incentive to post then further encourage them to buy. For the flagship of LifeWTR sending product samples to healthy social media influencers including information about the science behind pH balance in water will increase knowledge about pH balance in water. When influencer's post the product to their loyal following they are then reaching consumers influenced to buy based off of their posts. By informing consumers about pH in water we can conclude that the large portion of millennials who were unsure about pH balance in water would then be more influenced to buy a premium bottle of water. The Snapchat Geo-filter for Kent State specifically will encourage consumers to share the filter to their large following. We Geo-fenced the filter to the Kent State Recreational Center to target the Active Anthony segment but can be later rolled out to the entire market. The Snapchat Geo-filter will increase knowledge about LifeWTR and encourage consumers to test the product. The proposed campaigns will not only reach our target segments but also create an opportunity to build the count of other segments. Each campaign not only expands product knowledge but also engages with the consumer and encourages them to go out and buy more products. By giving the consumer deals to buy more products we are then turning consumers into Pepsi loyalists.
Final Recommendations
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Anderson, R., Dahlquist, S., & Garver, M. (2016). 75 Million Strong: Comparative Analyses of Millennials' Purchasing Response to Firms' CSR Behavior. AMA Summer Educators' Conference Proceedings, 27H-5. Are you Drinking Healthy Water???. (n.d.). Retrieved March 15, 2017, from http://altered-states.net/barry/newsletter587/ Connecting Donors and Meaningful Causes. (n.d.). Retrieved March 15, 2017, From https://www.clevelandfoundation.org/news_items/millennial-residents/ Consumers Are Thirsty for Hydration Reminders. (n.d.). Retrieved March 15, 2017, from https://www.cokesolutions.com/trends-insights/articles/consumers-are- thirsty-for- hydration-reminders Essentia 9.5 pH Drinking Water, 1.5 Liter, (Pack of 12) › Customer Reviews. (n.d.). Retrieved March 15, 2017, from DONOUGHE, L. (2016). What Millennials Want. Stateways, 46(6), 10. Consumers Are Thirsty for Hydration Reminders. (n.d.). Retrieved March 15, 2017, from https://www.cokesolutions.com/trends-insights/articles/consumers-are- thirsty-for- hydration-reminders Essentia 9.5 pH Drinking Water, 1.5 Liter, (Pack of 12) › Customer Reviews. (n.d.). Retrieved March 15, 2017, from https://www.amazon.com/Essentia-Drinking-Water-Liter-Pack/product-reviews/B0 5HG9ET0 Holbrook, J. (2016). The Millennial Dilemma. Checkout, 42(8), 36-38.
References
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SMITH, J. (2015). MILLENNIALS AND BRANDS. Global Cosmeti Industry, 183(3), 26-28 The Condition of Education - Participation in Education - All Ages - Enrollment Trends by Age - Indicator April (2016). (n.d.). Retrieved March 15, 2017, from https://nces.ed.gov/programs/coe/indicator_cea.asp Understanding pH and ORP in Alkaline Water. (n.d.). Retrieved March 15, 2017, from http://www.waterionizer.org/understanding-ph-and-orp-in-alkaline-water.htm "U.S. Bottled Water Market Grows 6.4 Percent in 2015." Beverage Industry 26 Feb. 2016: n. pag. Web. 7 Mar. 2017. <http://www.bevindustry.com/articles/89123-us-bottled-water-market-grows-64- percent-in-2015>. U.S. Census Bureau (2011). Selected housing charactersitcs, 2007-2011 American Community Survey 5-year estimates. Retrieved from http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml? pid=ACS _11_5YR_DP04.
Appendix Product Reviews : Essentia: “After hearing that Dasani and Aquafina (both cheap brands at my local retailer) are very acidic, I decided to try out Essentia. So glad I did! I have to admit that I have no idea why acidic water is really bad for me. But after trying this water, I don't think I will switch back to those brands.”-Amazon Reviewer “This water quenches my thirst more than those waters. Hard to explain, but it has a much fuller feel in my mouth, and I feel much better hydrated.” -Amazon Reviewer “….But what I did notice is that I have been around all kinds of sick people, coworkers, patients, kids, etc and I have not had a virus or illness once. There were 3 times when I felt like I was getting sick and I just drank more Essentia water and it never amounted to anything at all. I've had 2 sinus surgeries for allergies and been on antibiotics off and on for years for viral and allergy related sinus infections. I've barely taken any medications since drinking this water and I was an almost daily Allegra user. I'm real hesitant and skeptical to give such good review over alkaline water because there is very little research to back up what I've experienced. What the research "suggests" though is that viruses have a difficult time surviving in an alkaline environment. If I can spend a little money drinking alkaline water and not get sick, then I'd say it's definitely worth not missing work, time and energy going to the doctor, and battling a virus for several weeks. So I'm going to keep drinking it!...” –Nurse Review Amazon Review Fiji: “I don't mind paying a premium for Fiji water, since I don't drink soda, coffee, etc. It's not even that expensive when you compare it to price of other drinks.” -Amazon Reviewer
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Appendix
LifeWTR: “I just discovered this brand of water yesterday when I happened to see it on the shelf at my grocery store. I despise water. I have lived a life in a moderately dehydrated stage because I just can't stand water. Really. When I DO drink water, it must be flavored...although my brain screams at me that the artificial flavoring is not a good thing. Still, it seems to be the lesser of two evils. But, I liked the way this bottle looked so, oddly enough, I thought maybe I would like the way the water tastes, too. (It made sense in my brain for the half second I thought it). I bought a bottle…... and I went by the store and bought 2 more bottles. Just finished off the second one! Now, during my 900th trip to the potty today, I figured I would order a few 6 packs from Amazon and share my experience in case there are any other people out there with a hatred of water but a willingness to try a new brand!”- Kandace L “I'm obsessed with this water! The bottles are beautiful. Makes me feel less guilty about buying bottled water vs. something reusable, given the art on the label. Can't wait to see what the next series of label art is! Can't imagine why someone would choose Smartwater over this when (IMO) the taste is exactly the same - LIFEWTR is just prettier” - Amanda “I came across this product while browsing the water aisle in search of alkaline water at my local Walmart. It's not quite alkaline but I am very satisfied with my purchase. The taste is great and easy to down.” – Tisha McCory Smart Water: “We drink mostly reverse-osmosis filtered water to which we add minerals, but love the Smart Water when exercising/working out for the electrolyte content.”- SkinnyDiva “I'm actually drinking a bottle of Smart Water now as I write this review! This water is awesome with the added bonus of electrolytes. I've been drinking this water more often and especially when I'm sick. It really helps to replenish any lost liquids, and tastes great too. This water is a great alternative to Gatorade if you would rather drink water than a sports drink.”- Josh & Kim Epperson Bai AntiWater: “It has a weird smell and frankly, a weird taste. I like the idea of antioxidants so I'm going to see if I can get used to the smell and taste. It almost tastes like it has alcohol in it - I hope it doesn't. That would be a big lawsuit if they kept that off the ingredient list. Maybe its the coffee fruit extract.”- Amazon review
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Nestle Pure Water: The Nestle Pure tastes good and is affordable - The only thing that I don't care for are the thin, weak bottles. They feel flimsy and get squished easily when you grab them in a rush. Plus these bottles make that weird crackling noise while you drink. –Amazon Reviewer A clean taste, with no trace of minerals at all. Neutral in flavor. If you're a marathon runner, this would be a great choice. It quenches in a very direct and pleasing way. I prefer spring water (Ozarka), but still drink these on occasion if I'm out and these are the only choices, because they aren't bad waters, but since drinking more expensive brands the taste definitely isn't as good anyway. . –Amazon Reviewer I purchased these to save myself the hassle of carrying the water to my car then into the house. I like this brand. I used to buy one from fast food place or packs at the store, but this is cheaper and easier. The water tastes good. The bottles are BPA free. It's not worth paying more for shapes and "a little bit quieter" bottles. The lids are small but so are -all- water and soda bottle caps. . –Amazon Reviewer Aquafina: “This is clean water at a low price. If that's what you're looking for, you're gonna love it!”- Trunkasaurous Deja Blue: I have always thought bottled, unflavored water tasted the same. My adult children will only drink certain brands. DejaBlue is one they like. I have to say it does taste different. It has a slight sweet taste, & I like it. - Marilyn M Dasani: My go-to bottled water from Amazon Fresh. It honestly says on bottle that it's filtered and remineralized tap water (doesn't try to pretend it comes from a pure mountain spring, etc). It tastes good, and, unless most other brands, the bottles are sturdy enough not to get easily squashed and misshapen in my picnic cooler. Will keep buying as long as price doesn't get crazy.- Big Frank
Cuyahoga: 33,836 Baldwin Wallace- 4,784 Cleveland State - 20,660 John Carol- 4,006 Notre Dame College - 2,793 Ursuline - 1,583 Trumbull: 5,092 KSU Trumbull- 5,092 Portage: 37,666 Hiram- 1,383 Kent State- 35,386 NEOMED- 897 Geauga: 4,839 KSU Geauga - 4,839 Columbiana: 5,538 KSU E Liverpool- 2,846 KSU Salem- 2,692 Wayne: 2,089 Wooster- 2,089
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Stark: 15,703 Kent Stark- 7,230 Malone- 2,632 Mount- 2,345 Walsh- 3,496
Ashtabula: 3,801 KSU-ASH - 3,801
Youngstown: 15,285 Youngstown State- 15,285 Lorain: 3,094 Oberlin- 3,094
Lake: 2,817 Lake Erie College- 1,224 Write State- 1,593
Summit: 29,716 Akron- 27,833 Akron Institute Herzing- 652 Brown Macke Akron- 794 Bryant & Stratton College- 437
4-Year Universities in Each County:
Increases in the traditional college-age population and rising enrollment rates have contributed to the increase in college enrollment. Between 2000 and 2014, the 18- to 24-year-old population rose from approximately 27.3 million to nearly 31.5 million (source). The percentage of 18- to 24-year-olds enrolled in college also was higher in 2014 (40.0 percent) than in 2000 (35.5 percent) (source). In 2014, there were about 12.0 million college students under age 25 and 8.2 million students 25 years old and over. The numbers of younger and older students increased between 2000 and 2014
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“Consumption of flavored still bottled water is highest among consumers between 18-34 years old (66 vs. 48 percent of consumers overall), who also are the most likely age demographic to consume any still bottled water (93 vs. 85 percent of consumers overall), Mintel adds.”
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Mintel Bottled Water Review
Survey: We are Managerial Marketing students at Kent State University and we are studying the future of hydration. We kindly ask if you would spend a few minutes to answer a short survey that would greatly help our research. Thank you in advance for helping us out! Q1 Are you 18 years of age or older? Yes No Q2 Do you live on/off campus? On Campus Off Campus Q3 Do you currently have a meal plan through Kent State? Yes No Q9
Survey Questions:
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Which social media platform(s) influence your purchase decisions the most? (Select all that apply) Facebook Twitter Instagram Snapchat LinkedIn YouTube Tumblr Pinterest Other Do Not Use Social Media Q8 Indicate your overall feelings toward the following social media platforms. Like a great deal Like a moderate amount Like a little Neither like nor dislike Dislike a little Dislike a moderate amount Dislike a great deal Facebook Twitter Instagram Snapchat LinkedIn YouTube Tumblr Pinterest Q34 Do you post products that you have purchased on social media? Yes No placerat vehicula in vitae est. Integer hendrerit sapien finibus finibus luctus. Aenean at finibus purus, at aliquet mauris.
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Q34 Do you post products that you have purchased on social media? Yes No What social media platform do you post these products on? Facebook Twitter Instagram Snapchat LinkedIn YouTube Tumblr Pinterest Other Q19 Rank in order of which types of beverages you drink most to ones you drink least. 1Water 2Pop/Soda 3Coffee/Tea 4Sports Drinks 5Juice 6Other
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Product 1
Product 2
Product 3
Q26 For the next section, hydration beverages are defined typically as a non-carbonated drink. For example: Water, Juice and Sports Drinks. Q7 List the first 3 hydration products that come to mind. Q4 Do you typically purchase hydration beverages on/off campus? On Campus Off Campus Do Not Buy Hydration Products Q36 When do you feel you really need to purchase a hydration product? (Select all that apply) After Workout Hungover During Workout Grocery Shopping When It's Convenient Morning Commute During A Meal Before A Night Out
Unfamilar With Product
Aquafina
Dasani
Deja Blue
Really Dislike
Dislike
Neutral
Like
Really Like
Pure Life
Smart Water
LifeWTR
Fiji
Essentia
Bai Anti Water
Gatorade
Powerade
Propel
SoBe Life Water
Vitamin Water
Q6 Rank the options in order from most important to least important to you when it comes to choosing hydration products. 1Price 2Quality 3Health Benefits 4Brand Loyalty 5Sustainability Q23 Please indicate your overall feelings toward each product.
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Q21 Having a pH balanced water is important to me. Yes No Not Sure Q24
Q25 Why would you purchase the above product? (Select all that apply) Makes Me Feel Healthy Makes Me Feel More Attractive To Relate To My Peers Stay Up To Date With Trends The Taste To Share On Social Media Word Of Mouth Looks Healthy Would Not Purchase
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Q28 Q30 Why would you purchase the above product? (Select all that apply) Makes Me Feel Healthy Makes Me Feel More Attractive To Relate To My Peers Stay Up To Date With Trends The Taste To Share On Social Media Word Of Mouth Looks Healthy Would Not Purchase
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Q33 Why would you purchase the above product? (Select all that apply) Makes Me Feel Healthy Makes Me Feel More Attractive To Relate To My Peers Stay Up To Date With Trends The Taste To Share On Social Media Word Of Mouth Looks Healthy Would Not Purchase
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Q17 Select all that apply. 1.Sustainability is important to me. 2.I would buy strictly because a company is sustainable. 3.I would buy a sustainable product even if it cost more. Strongly Agree Agree Somewhat agree Neither agree nor disagree Somewhat disagree Disagree Strongly disagree Which form of sustainability is most important to you? Gives Back To Society Gives Back To The Economy Gives Back To The Environment Q14 Are you a male/female? Male Female Prefer Not To Answer Q10 Enter your current age.
Personal information How old are you? What are your hobbies? Do you regularly workout/ gym/ are active? Do you have a meal plan or not? Where do you buy groceries? On campus store and if off which one? Where do you buy hydration products? On and off campus Do you use social media? How often? What Platform? In two words describe yourself. What is your go to drink when very thirsty? What is your go to drink when relaxing and enjoying a meal? Millennial / Ads / Tech Do you watch live tv? Where do you mostly see ads? How do you get information? What adds do you like and why? How long do you think your attention span is? If so, Why do you skip over ads? Where do you think ads are more receptive, what platform? How often do you share what you eat or drink and on what platform?
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Focus Group / Interview Protocol Questions:
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On products What kinds of things do you see going on in the industry?” What do you think the future of hydration will look like? What is your drink of choice when you are: Hungover After a workout Pre-workout Relaxing Thirsty At a meal Why do you drink other products over water? What do you think of when we say hydration products? What is your opinion on pop? What is one health concern that you are mindful of? ( sugers, artificial,) What do companies need to do if they charge more for water? Do you like having cool products that go to multiple causes? What does pH balance mean to you? Does an Eco friendly bottle change your view of the product/company. Will you buy them because of that Will you support a company solely on their sustainability?