Both Coke and PepsiCo are launching lemon-lime drinks in the hope of capitalising on the crucial summer sales period. However, as they launch ever more new products, marketing budgets will be spread more thinly.


Meanwhile fragmenting media channels mean that marketers will have to become increasingly creative with their limited budgets.


The battleground for US consumers’ drink of choice this summer is being readied. PepsiCo has recently launched its previously regional lemon-lime drinks brand Sierra Mist at a national level. Coca Cola is extending its Sprite brand with a lemon-lime variant called Sprite Remix. In response to this activity, Cadbury-Schweppes is investing in a new ad campaign to boost its 7Up brand.


In the struggling US carbonated soft drinks market, saturation is becoming an increasing problem. Manufacturers have been relying more heavily on new product development to boost sales and stem market stagnation.


However, it is expected that there will be less media budget available per new launch. While there will be visible promotion of many of the new products, marketing departments still have to maintain the prominence of more established brands. And, despite the higher numbers of products, it does not look like marketing budgets will necessarily be rising in line with this growth.

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In addition, mass media channels are becoming less effective as a means to reach large audiences, as saturated TV audiences are being spread more thinly across the rising number of channels. The media is also becoming more and more fragmented as newer channels such as the Internet become progressively more popular in the home.


In such a case, marketers must become increasingly creative in their efforts to reach consumers. It can be expected that below-the-line marketing initiatives will gain increasing prominence, for example, greater use of sampling, direct mailing and event marketing. Indeed the use of event marketing provides an effective method to reach highly targeted audiences and cut across the problem of fragmenting media channels.


Related Research: Datamonitor, “Targeting Event Audiences”  (DMCM0132)