All is not well at Fruit Towers, the West London headquarters of juice and smoothie brand Innocent. At the start of the year, managing director, Jamie Mitchell, left his post in a cloud of confusion that led many to assume his departure was linked with dwindling sales figures. The company said it was a simple reshuffle.
The assumption was not an unreasonable one - the economic downturn seems to be hitting Innocent hard, as consumers now seek cheaper alternatives to its products. Sales for the brand soared in 2007, reaching £134.1m, up 60% year on year, according to Nielsen. However at the end of 2008 they had plummeted by 20% to £107m.
In comparison, Innocent's main rival in the UK, PepsiCo brand Tropicana, posted a sales increase of 16% in 2008 across its entire portfolio. Innocent's share took a further battering when PepsiCo announced it would be axing PJ Smoothies to concentrate on its booming Tropicana Smoothie range.
As value becomes more crucial for consumers, the company faces the tough task of reducing prices without fuelling the perception that it has been ripping off the public in the past.
Innocent's new marketing director Thomas Delabriere has a tough year ahead, but are the brand's glory days behind it? We asked Steve Cooper, co-founder and marketing director at The Feel Good Drinks Company, and Michael Sugden, managing director at VCCP, which is on Coca-Cola's business roster, for their thoughts.
Diagnosis Two industry experts explain how Innocent can rejuvenate sales
Steve Cooper co-founder and director, Feel Good Drinks Company
First, let's be clear: one of the marketing success stories of the past decade hasn't transformed into a business basket case.
Don't be fooled by the innocent imagery and 'tasty little drinks' description - this is a powerful business. Its 2008 annual report detailed a turnover of more than £100m and 250-plus employees.
While these numbers are impressive, I think it's fair to say that until last year this success had been achieved in a period of economic boom and without any significant direct competition.
Innocent was inevitably going to face challenges, and this has come in the form of an economic downturn with consumers demanding that brands justify every extra penny: that's a lot of justification for a carton of Innocent.
At the same time, some credible competitors have entered the smoothies market with more accessible prices.
But it's not all doom and gloom for Innocent. The global trends of health and naturalness that helped it grow so quickly aren't going away. Consumers will still pay more for quality brands, although admittedly the purse strings, aren't as stretchy as they used to be.
Remedy
- To borrow a phrase from an Innocent promotion: 'stick to your knitting'. To most, Innocent equals smoothies, so expanding into other categories could detract and distract.
- Be Innocent in everything the brand does. Last October the ASA upheld a complaint against its sister brand This Water as misleading. The ad was deemed to imply that the product, the brand's big move into the still-drinks sector, was made with only juice and water, but it also contains up to 42g - or eight teaspoons - of sugar.
Michael Sugden managing director, VCCP
Innocent promised a new style of brand and we literally lapped it up. I wanted to hang out at Fruit Towers, I wanted to meet the founders and congratulate them on following their dream and I wanted to have an Innocent smoothie bottle on my desk to prove I was a healthy, modern, chilled-out kind of guy.
It's hard to say exactly when the brand lost its sheen and became so weary. The product is still great and still delivers genuine goodness, but the Innocent world seems to have closed up on itself and become formulaic. It has lost its innocence. The trust and intimacy which it built with the promise of being truly transparent has been corroded; not helped when we found out the quantity of sugar in sister brand This Water and discovered the founders were keen to partner with McDonald's.
Innocent has outgrown its hippy quirkiness and the brand needs to stop pretending that it is still just three mates and a juicer. Instead it should grow up a little, refresh its communications and remind people why they bought the product in the first place.
Remedy
- Grow up. The company has become a multinational force but the brand persona hasn't really come to terms with this. Being big and grown-up doesn't have to be a bad thing, just stop being disingenuous.
- Be original. We loved the Regent's Park Fruitstock festival and the woolly hats first time round, but it's all become a bit monotonous and overly cutesy.
- Hold your nerve on price. Innocent's products aren't cheap but they deliver a true health benefit. Constant discounting just commoditises the product.