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Witts Cuppa

A Pet Beverage Company

5/1/15 Market Report

Witts Cuppa Pet Care Company Witts CuppaTable Of Contents

1. Executive Summary……………………………………………………………………... 2

2. Stage I -Product Conception/ Standardization or Adaptation…………………………….3

3. Political & Legal Forces…………………………………………………………………..6

4. Economic Forces…………………………………………………………………………. 8

5. Social & Cultural Forces…………………………………………….. …………………...9

6. Technological Forces…………………………………………………………………… 10

7. Environmental Forces………………………………………………. …………………11

8. Competitive Forces…………………………………………………. ………………….12

9. Stage IV - SWOT Analysis………………………………………………………………13

10. Stage V - Research Survey………………………………………………………………14

11. Stage VI - International Marketing Mix………………………………………………... 15

12. Conclusion & Recommendation………………………………………………………... 16

1 | P a g eWitts Cuppa Pet Beverage company

Witts Cuppa Pet Care Company Witts Cuppa

Executive Summary

A pet health drink appeals to many pet owners across a wide range of demographics. As

an affordable health supplement, pet owners everywhere will be scrambling to purchase Witts

Cuppa Health drinks to keep their dog in the best health for many years to come. With

promotional deals and bulk purchasing, retailers should easily be able to incorporate Witts

Cuppa’s Health drinks into their wide variety of pet care products and food.

With a production cost of $0.89 a unit, Witts Cuppa will mark up the product by $1.00 to sell to

Wholesaler for $1.89. This will cover production and shipping cost while providing room for profit. The

drinks will be bundled together and sold in packages of 12 for $22.99. As part of a promotional deal,

Witts Cuppa will implement a competitive introductory pricing of only $19.99 a case for the first 90 days

of purchase by a new retailer.

Distribution Scheme



Product Conception/ Standardization or Adaptation

The group project our group is working on is product for dog owners. This product is for

dogs who are overactive, stressed out and also dogs with low immunity. Our product is a water

based product that has as certain vitamins that will make the dog owner as well as the dog have

better chemistry and a better overall experience with activities on a daily basis.

Overactive: If you have a dog that is a very energetic and taking it for a walk is a struggle. You

will be able to give your dog the water that is meant for overactive dogs. Before you go out for

the walk the owner can give the dog our product and after a short period of time you will notice

that your dog will become calmer, at this point the owner will be able to have a more enjoyable

time walking their dog.

Stress: Some dog owners have dogs with extreme separation anxiety. If the pet owner has a dog

that barks, whines, and howls for hours after they leave the house, the owner will be able to give

the dog our product that deals with stress. Give the dog water before you leave and the dog will

become less stressed and will leave the dog in a euphoric state while you're gone.

Immunity: If a dog owner has a dog with a low immunity and has a hard time trying to get your

dog to take its daily vitamins. Our immunity water will make it easy for the owner. The dog

owner will just pour the water into the dogs bowl and the dog will get its daily vitamins all day

while it drinks.



SWOT Analysis

Witts Cuppa is stepping up to create one of a kind boundless product for pet industry. A strong

portfolio of pet products which will help us create a change in Pet industry with its competitive

advantage. However, intensified competition could lead to declining sales for the company.

Strengths WeaknessesExtensive brand portfolio New Product, lack of appreciation, not strong

connection with leading Pet Store.Opportunities ThreatsOver the years there has been a great spending on domestic and international level on pet products. Increasing level of pet ageing.

Increasing competition from large retailers.Rising labor wages in the US

Opportunities

Increasing spending on pets in the US Industry reports suggest positive trends in the pet-

centered businesses even during weak economic condition. According to a survey conducted by

an industry source, about 68% of the US households own a pet, which is equivalent to

approximately 82.5 million homes. Overall, there are nearly 95.6 million cats and 83.3 million

dogs owned as pets in the US. According to the industry estimates, the overall spending on pet

industry in the US increased from nearly $51 billion in 2011 to $53.3 billion in 2012 and reached

approximately $55.7 billion by the end of 2013. A significant increase has been observed in pet

food spending. The spending on veterinary care accounted for 25.8% of the market in 2013. Pet

services was another category that registered highest growth in the year. The overall spending on

pet industry in the US is expected to reach $58.5 billion in 2014, an increase of 4.9% over 2013.

With a wide portfolio of food products for dogs and cats, the company is well positioned to

capitalize on this growth trend.


Witts Cuppa Pet Care Company Witts CuppaWith the increasing number of pet owners worldwide, the health concerns of pets among

these owners are growing at a fast pace. According to a latest survey conducted by an industry

source, over 36% of dog owners have a dog older than seven years of age. This indicates a strong

possibility of a large group of pet owners facing issues related to their pet’s health due to

cognitive decline. Under such a situation, pets usually forget how to perform their normal

functions like using a litter box or finding a food bowl. According to industry sources, 28% of

cats aged 11−14 years and 50% of cats aged older than 15 years have problems like memory loss

and reduced social interaction. Also, 28% of dogs aged 11−12 years and 68% of dogs aged

15−16 years have one or more signs of cognitive issues. To improve the mental health of pets in

their older age, the company developed a nutritional enrichment with fish oil and antioxidants. It

is named the Brain Protection Blend and will be added to select Purina products for cats and

dogs in the next 12 to 18 months. This product helps in reducing the risk relating to brain ageing

and is to be consumed by pets during their middle age. Therefore, with the increasing levels of

pet population facing ageing problems, the company, through its new products like Witts Cuppa

Energizer Blend, can serve a fast expanding segment of pet owners. This, in turn, could help the

company improve its revenues.

Weaknesses

Witts Cuppa’s witnesses is the complexity of the project. Since, no one knows that

product and do not know how their dog will react to it, it is most likely for no one to buy it due to

not knowing what it is. The product is beverage product, people will want to know what it

contains, although the ingredients are listed in the product’s packaging. Considering that pet

owners are very protective of their pet, they always want the best for them but as this product is a


Witts Cuppa Pet Care Company Witts Cuppabeverage people usually do not get convinced right away. One of Witts Cuppa focal points is to

achieve greatness for the pets and the owners. A way we can do that is by integrating drinks into

our pet’s diet.

Another weakness we notice was, the lack of reputation. As Witts Cuppa is a new

product for pets, people do not really know what the product is about. This will not help our

product to be sold until people recognize the quality of the product. We have not established

ourselves as a reputable pet beverage provider yet. People do not know the product that well,

which is why we lack reputation. The lacking of reputation will hurt our sales, supply and

demand. If people do not demand of the product, there is no supply, therefore there are no sales.

Right now the product is being tested and as of now the company does not have any

partnerships or strong relationships with a pet store retailer. If the company gets a pet store

retailer it will be much easier for the product to be sold and we will be able to get samples of

different people in many regions within the USA. People can try our product and we can get

access to peoples likes and dislikes of the product. This way we can select a region and with the

partnership we can sale the product nationwide. With this partnership is much easier to grab the

attention of our target market and since the target market trusts on the pet store we are going to

be affiliated with, people will buy the product with ease.

Strengths

Witts Cuppa is an emerging company in the US pet food market, owing to an extensive brand

portfolio of the company. It manufactures and markets a wide range of dog nutritional drink

products brands catering to various nutritional needs of pets. An extensive strong portfolio of

products provides the company with a competitive advantage, and results in steady revenues and

profits.


Witts Cuppa Pet Care Company Witts CuppaWith an innovative product, Witts Cuppa will be able to claim a large hold on a previously

untapped market staking its claim early for a huge potential for growth. With its approval by the

FDA and priced competitively it will make a very appealing product to be recommended by vets

and is targeted towards health conscious dog owners.

Threats

The pet products and services retail industry has become increasingly competitive due to the

Expansion of pet related product offerings by certain supermarkets, warehouse clubs and other

mass and retail merchandisers and the entry of other specialty retailers into the pet food and pet

supply Market, some of which have developed store formats similar to the company. The key

competitors of the company are Target, Wal-Mart, Petco Animal Supplies, Safeway and Costco,

which also offer a wide range of pet products and services. The companies currently operating in

the industry are expected to feel the pressure of the low cost alternatives from large retailers like

Wal-Mart and Target. Pricing pressure will increase as competition increases and will impact

Witts Cuppa’s margins, because our product could would be distributed through one of these

retailers.

Another threat could be other competitors with up and coming products similar to ours.

They would automatically be at an advantage over us due to the fact that we are new to the

market. Our name is not known yet. But we plan to find out what the other business's service

involves and combine it with what people expect in our product. We will then use this

information to ensure we provide the highest quality service, covering all and more of what is

expected, at the lowest price possible.

Customer desire is an also a threat because if customers feel like they don’t need our

product for their dogs they won’t buy it. We have sell it to them as a necessity that they need in

order to get and maintain a loyal customer base.


Witts Cuppa Pet Care Company Witts CuppaRegulations and Qualifications is another threat. There may be a few regulations that our

business will need to follow to operate and be successful. Firstly, we would have to ensure our

products are safe and do not contain any hazardous chemicals that could potentially harm the

dogs. We can make sure this is the case by purchasing professional standard products that have

been tested to be successful and safe. Labor costs are rising in the US. The federal minimum

wage rate in the US, which remained at $5.15 per hour since 1998, increased to $5.85 per hour in

2008. It further increased to $6.55 per hour in 2009 and to $7.25 per hour in 2010. Furthermore,

many states and municipalities in the country have minimum wage rate even higher than $7.25

per hour due to higher cost of living. The increase in labor costs could increase the Witts

Cuppa’s overall costs and affect its margins.

Target Market Segmentation Strategy

The primary market for Witts Cuppa products is dog owners. Older householders are the

biggest spenders on pets. Married couples without children at home, most of them empty nesters,

spend 30 percent more than the average household on pets. The best customers of the pet

industry (the households that spend the most on pet products and services) are married couples

with adult children at home. These "crowded" nesters spend 45 percent more than the average

household on pets. Those aged 55 to 64 spend 26 percent more than average. Spending on pets is

below average among householders aged 65 or older and also among those under age 35.

Married couples with preschoolers spend less than the average household on pets, as do single

parents and people who live alone.

The primary market shopping for retailers: The pet retailing business has three

subdivisions: large national superstore chains, independent pet stores, and general line retailers,

such as supermarkets that carry pet supplies in addition to many other things. The first two


Witts Cuppa Pet Care Company Witts Cuppasubdivisions are sometimes collectively known as pet specialty retailers to distinguish them from

supermarkets and general merchandise stores. Pet Smart Inc. and PETCO Animal Supplies Inc.

are the largest national retailers of pet supplies. Using a superstore format that may include more

than 10,000 different products that also national coverage. This would be a perfect fit for Witts

Cuppa because it would expose our product nationally which could possibly lead to other

partnerships with different companies and services.

Social & Cultural Forces

In the business environment, there are various factors that affect the environment in the

business area. Among these factors, stand the social and cultural forces. In the United States this

factors are very important because the businesses need to have certain requirements that the

government asks for. They have to consider the demographics, income distribution, educational

levels, religion, language, lifestyle, consumerism, workforce mobility, and worker rights in order

for the product to be a success. When marketing the product and pricing it, marketers have to

distinguish every variable so that the consumers can buy this product. Social and cultural forces

play an important role in today’s marketing world because they have to know the demographics,

religion, and language among others in order to know if the product is going to be a success.

In the United States and in any other country’s economic status, it is very important to

know the demographics of a country. United States has a vast population of 319 million citizens.

The demographic composition of this country is 66.4 percent of the population is in the age of 15

through 64. The group of the age 65 and above consist of 14 percent and form the age of 0

through 14 belong to the 17 percent of the population. A of 2011 the ethnic groups in the country

consist of 80 percent whites, 13 of Blacks, 4.43 of Asians and 3 percent of others (marketline).

The main language of the United States is English and while other languages arrive Spanish has


Witts Cuppa Pet Care Company Witts Cuppabecome the secondary language. Its main religion is protestant with a 51 percent of the

population and 24 percent catholic (marketline). Other cultural religions that the United States

carries is Mormon, Jewish and Christian. This religions come from other cultures that have

emigrated the USA on the last two decades.

Aside from demographics, the United States’ educational levels are very admirable

percentage of the adult population entering to the education territory, with a 42 percent of adults

in the age of 25 to 64 (marketline). The education is divided into groups such as public schools,

private schools, and homeschooling. The schools years are from kindergarten to 12th grade and

this classes are divided into sections such as elementary, junior high school, and senior high

school (marketline). College education is separated from the government findings to get this type

of education. After college people can pursue to a higher education, which provides specialized

learning.

Overall, the demographics of the United States show that there are a vast of people

helping businesses economy to keep moving forward. In the United States there are many people

from all over the world. The workforce mobility in this country allow employees to move from

one work to another within 11 days of notice. They can be transferred within 2 weeks prior to

their notice. Religion and language is what makes the United States business very unique.

Pricing Strategy

To sell our product, Witts Cuppa has implemented a penetrating pricing strategy. When

the product is first released it will have a low price as to discourage competition and to grab a

sizable share of the market. Once a grasp is obtained on the consumer market we can raise

pricing as it coincides with demand for the product to generate greater revenue. This strategy


Witts Cuppa Pet Care Company Witts Cuppamight give the company some competitive breathing room (potential competitors won’t be

attracted to low prices and modest profits).

With a production cost of $0.89 a unit, Witts Cuppa will mark up the product by $1.00 to

sell to retailers for $1.89. This will cover production and shipping cost while providing room for

profit. The drinks will be bundled together and sold in packages of 12 for $22.99. As part of a

promotional deal, Witts Cuppa will implement a competitive introductory pricing of only $19.99

a case for the first 90 days of purchase by a new retailer.

Goals of first year

First 90 Days:

· Distribute product to large Pet retail stores

· Establish loyal retail customer base with low pricing and promotions

Rest of year goals:

· Raise prices as demand increases allowing more room for profit

Distribution Strategy

Witts Cuppa is committed to its brand loyalty. Distribution Strategy is the method you

use to get your product or service through various distribution channels to the ultimate purchaser

or end-user – in other words, how and where the consumer buys your product or service. We are

located in Lowell, MA. We are operating from a small warehouse where we distribute it to our

Wholesalers such as A&H Notini, Core-Mark, Pine State Trading CO., and large retailers such as

Petco & Pet Smart. As our product is FDA approved and certified to sell it throughout United

States.

Distributing through these companies will help reach our target market through various

strategies as most of our customers and retailers buy our products from this wholesale providers


Witts Cuppa Pet Care Company Witts Cuppaand Sales Agents. We will have sales representative’s carryout demos at Pet Smart and Petco, or

at any veterinary services just to get that understanding between our product and customer and

we would give out free samples to increase more sales.

Promotion Strategy

Promoting and Advertising is a form of communication designed to persuade potential

customers to choose your product or service over that of a competitor. Successful advertising

involves making your products or services positively known by that section of the public most

likely to purchase them. It should be a planned, consistent activity that keeps the name of your

business and the benefits of your products or services uppermost in the mind of the consumer.

As our selling cost to our retailers is $22.99 per case but as an introductory offer we will help our

retailers save money by giving them a concession on each case which will mark down to 19.99

per case, it should help us compete in the market. Plus we would have small treats for pets, and

supply it for free through our retailers as it would help them upsell our products and increase in


Witts Cuppa Pet Care Company Witts Cuppatheir profit margins. There will be all sort of promotional displays, gifts, posters and floor

displays sent out through sales reps.

Sales Projection

One the first year, Witts Cuppa plans to sell 6,651 beverage units. We are starting with a

promotional price of $19.99 per 12 bottle case and this promotion will be only for 6 months.

After this the price for a case of 12 bottles, will be offered at a price of $22.99 and this will be

only sold are pet stores as a package, there are no single beverage price. We project our first year

sales to be of $286,000 dollars.

The 12 bottle case will bring 4 bottles of the three types of beverages. The bottles are of 12 fluid

ounces and have one distinguish flavor. For the overactive, we have tested on animals and this

beverage has valerian root and ginger root fruit extract, and other ingredients to help the pet to

calm down and be less active. The stress beverage has chamomile flowers extract to help the pet

relax. Finally, our projected bestseller will be the immunity drink. This drink has a variety of

fruit and leaf extract to help boost the pet’s immune system.

First Year Sales of $286,000

-First quarter of $11,916.67

-Second Quarter of $11,916.67

-Third Quarter of $131,083.33

-Fourth Quarter of $131,083.33


Witts Cuppa Pet Care Company Witts CuppaFirst Year Manufacturer Sales is of 6,651 units sold

-First quarter of 277 units sold

-Second Quarter of 277 units sold

-Third Quarter of 3048 units sold

-Fourth Quarter of 3048 units sold

Conclusion

With a unique product and sound marketing strategy, Witts Cuppa’s pet health drink

will be able to grab a significant market share with in the first year of production. With a target

market of health conscious pet owners and vet recommendations the company should start

turning profits with in the first year.

A pet health drink appeals to many pet owners across a wide range of demographics. As

an affordable health supplement, pet owners everywhere will be scrambling to purchase Witts

Cuppa Health drinks to keep their dog in the best health for many years to come. With

promotional deals and bulk purchasing, retailers should easily be able to incorporate Witts

Cuppa’s Health drinks into their wide variety of pet care products and food.

I highly recommend this product to be launched for the 2016 fiscal year. With

projected success and high profit margins, Witts Cuppa’s Pet health drink would be a great

addition to the Doggie & Cattie Company’s product portfolio. This product will help increase

revenue, and that money can be used to strengthen existing policies or products or help Doggie


Witts Cuppa Pet Care Company Witts Cuppa& Cattie Company develop new products to help expand their portfolio. Having low production

costs and high retail value, this product would make an excellent cash cow, providing much

needed steady profit.

Works Cited

Nestle Purina Pet Care Company SWOT Analysis. (2015). Nestle Purina Pet Care Company SWOT Analysis, 1-7.


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