Mountain Dew: Selecting New Creative case study focuses on the importance of creative advertising amidst the changing times and a competitive environment.
Douglas B. Holt
Harvard Business Review (502040-PDF-ENG)
October 05, 2001
Case questions answered:
- Evaluate the situation of Mountain Dew in 1999.
- What is your recommendation to Scott Moffit? Which advertising creative should he consider? Why?
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Mountain Dew: Selecting New Creative Case Answers
Q1. Evaluate the situation of Mountain Dew in 1999.
Mountain Dew’s brand is becoming more pronounced. Due to decreasing sales of Diet Coke and the increasing popularity of Mountain Dew, Mountain Dew has become the third-largest carbonated soft drink (CSD) at retail, overtaking Diet Coke.
CSD as a segment suffering losses: There is a growing inclination of teens towards the newly emerging non-CSD segment. This non-CSD segment included tea and juice blends, a sports drink called Gatorade, and also another highly caffeinated sugary drink called Red Bull.
The new entrants began a trend to experiment among non-CSDs and bottled water as substitutes for CSDs. This is the reason why the trend started because of a 5% increase in retail price for the drinks in the CSD category, which did not go well with the consumers.
Brand health KPIs are in good shape for Mountain Dew. In the spring of 1999, PepsiCo gathered some Brand Health Measures (key performance indicators) that were influenced by advertising, which significantly influenced the sales of Mountain Dew.
This study was done on teens because, at this age, they often experiment with a variety of drinks to become loyal lifetime drinkers of single soda. The observations from the study are noted in the table below.
Advertising ideas of Dew are becoming outdated: The effect of the famous “Do the Dew” campaign is becoming old as it is entering its 8th year after its launch.
Though this has been successful and helped the brand grow organically in the past, it may not be as relevant in the current scenario. This is due to changing demographics, the introduction of new substitutes, and increasing competitor’s advertising budgets.
Q2. What is your recommendation to Scott Moffit? Which advertising creative should he consider? Why?
Advertising can be a cost-effective way to disseminate messages, whether to build a brand preference or to educate people. An advertisement molds the viewers’ perception of the brand and conveys the intended message to a wide spectrum of viewers.
Given the reach of advertisements, it becomes vital to evaluate them on the basis of important factors such as…
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