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Week 3 Written
Assignment
IMC 618
Robby Shoup
11/16/2009
Situation Analysis
A major communication problem that Gatorade has faced in the past year is a
growing disconnect with its customers in regard to its latest marketing campaign. This
is a crisis of communication that Gatorade has been able to avoid throughout their
history. However, with their “What’s G?” campaign of the past year customers have
been turned off. Gatorade lost market share for the first time in its almost 50 year
history during 2009. During the first quarter of 2009, Gatorade lost 6.3% of the market
and 13.7% of its total volume of sales. This resulted in Gatorade owning 73.7% of the
market. (Helm, 2009) The market share loses continued as the year progressed,
resulting a total 18% in the first half of 2009. (Sterrett, 2009) The “G” campaign has
confused consumers and given them a reason to switch to cheaper alternatives such as
PowerAde.
One of the main barriers of communication that exists for Gatorade is an eroding
customer base that has lost a connection to the product. About a year ago, the
packaging of Gatorade, which is the primary form of communication to potential
consumers in a store, was changed to feature a prominent “G” with the word Gatorade
in very small font. Additionally, Gatorade engaged in a new marketing campaign was
introduced with commercials that asked viewers “What’s G?” with athletes heads shown
and described with fluffy intangible adjectives like “Heart, Hustle, and Flow” but no real
answer saying that “G” was Gatorade, the same Gatorade that people know and love.
Subsequent commercials feature montages of athletes performing, but no mention of
the benefits of Gatorade or the name Gatorade. With the omission of one of the most
iconic brands in the world Gatorade wasted a year of potential communication and P.R.
opportunities. Hauser describes the effort of the Gatorade effort as “schizophrenic.”
(Hauser, 2009)
I feel that Gatorade, which had been a master of P.R. for many years, made a
completely shocking gaffe that set back a seemingly indestructible brand back at least a
year, in a bad economy no less. Luckily, Gatorade still has a significant share of the
market and only one main competitor in PowerAde, which is owned by Coca-Cola, the
chief competitor of Gatorade’s parent company, Pepsi. In my opinion, Gatorade needs
to engage in a major P.R. campaign that will reestablish then name Gatorade, they are
lucky because the name Gatorade is a major weapon they most people want to see “come
back” even though Gatorade has technically gone away. They can incorporate some
piece of the “G” campaign, but I think that it should be a complementary part of the
campaign instead of the focus. Commercials should talk about the benefits that
Gatorade provides athletes, both professional and recreational. This tactic along with
utilizing Gatorade long standing famous athlete relationships would help the Gatorade
brand regain lost market share before the current market situation gets to the point
where it can’t be easily fixed.
Core Problem
Gatorade rebranded their product as “G” and created a disconnection among consumers
thus causing the brand to lose market share and goodwill to their main competitor
PowerAde.
REFERENCES
Hauser, E. (2009, February 3). The Healing Process Needed for Gatorade. Retrieved
November 15,2009 from http://www.ixma.org/articles/cm020309.pdf
Helm, B. (2009, April 24). Gatorade Sales Plummet. Retrieved November 15, 2009 from
http://www.businessweek.com/the_thread/brandnewday/archives/2009/04/gatorade
_sales.html
Sterrett, D.(2009, November 10). PepsiCo adding new drinks to Gatorade playbook.
Retrieved November 15, 2009 from
http://www.crainsnewyork.com/article/20091110/FREE/911109995