SWOT Analysis of Innocent Drinks

Summary of the SWOT Analysis of Innocent Drinks

This UKEssays.com SWOT Analysis of Innocent Drinks highlights the key factors shaping the company’s position in the competitive beverage market. We discover Innocent Drinks strengths in its strong brand reputation for quality, innovation, and ethical values. This in turn attracts significant outside investment from Coca Cola. The ensuing partnership ultimately gives Innocent access to greater marketing power, financial security, and expertise, helping the brand expand and maintain a competitive edge.

Additionally, Innocent Drinks benefits from for its commitment to sustainability and social responsibility. In turn, this further enhances its appeal among health-conscious and ethical consumers.

However, the Innocent Drinks SWOT also reveals several weaknesses. Innocent Drinks is still relatively new and less well-known compared to established competitors like Tropicana, which benefits from a broader product range and greater market experience. One of the main Innocent Drinks weaknesses is its premium pricing, which makes it vulnerable during periods of reduced disposable income and limits its accessibility to price-sensitive consumers.

The company’s heavy reliance on the UK market exposes it to local economic fluctuations. Moreover, the lack of product patents means rivals can easily imitate its offerings. Additionally, some loyal customers have expressed concerns over Coca Cola’s involvement, potentially impacting brand loyalty.

Overall, the Innocent Drinks SWOT demonstrates that while the company enjoys significant strengths, it must address its weaknesses to sustain growth.

Introduction to Innocent Drinks

Innocent Drinks was founded in 1998 by Cambridge graduates Richard Reed, Adam Balon, and Jon Wright. Inspired during a skiing holiday, they developed smoothie recipes and tested their idea at a London music festival, inviting customers to vote on whether they should quit their jobs to pursue the business.

The overwhelmingly positive response led them to launch Innocent Drinks in th UK in 1999. Initially, they sold to local cafes, quickly expanding after a successful trial with Waitrose supermarkets. The brand became known for its natural ingredients, playful marketing, and ethical commitments, including donating a portion of profits to charity and establishing The Innocent Foundation.

Throughout the 2000s, Innocent Drinks grew rapidly, introducing new products and expanding across Europe. However, the 2008 financial crisis led to financial difficulties, prompting the founders to sell stakes to The Coca-Cola Company. Coca-Cola would acquire full control of the brand in 2013.

Today, Innocent Drinks is a leading European smoothie and juice brand, recognised for its innovative products and strong commitment to social and environmental causes. The SWOT analysis reveals the strengths and weaknesses of Innocent Drinks and addresses the opportunities and threats presented by the PESTLE analysis (Johnson et al 2014).

Strengths

Innocent Drinks strengths lie with its brand reputation for quality and innovation, which is what attracted Coca Cola. Innovation has been seen in both the product and how the business model includes economic, societal and environmental concerns (Innocent 2017, Withers 2017).

Innocent has won awards for its brand and products including being recognised as a social brand with strong ethical values which are reinforced by its organisational culture and can provide competitive advantage (Innocent 2017). The investment of Coca Cola also enabled Innocent to access its considerable marketing and media power as well as gain financial security, during a period of falling sales (O’Reilly 2014).

Weaknesses

In comparison to other fruit juice brands, Innocent Drinks is still relatively new and less well-known. It faces strong competition from Tropicana Products, owned by PepsiCo, which is currently the number one brand in the UK and has an extensive range and experience in this sector.

Innocent Drinks also charges a premium price for its products, which has made it prone to a fall in demand during periods of reduced disposable income and the reliance on the UK market does make this a particular weakness (Withers 2017). A further weakness for Innocent is the lack of patent for its products which means that its products can be copied.

Opportunities

The increased health concerns expressed by both the UK government and society may present considerable opportunities in promoting Innocent drinks as an alternative to more sugary drinks with artificial additives (Britvic 2016). The sale of Innocent to Coca Cola has also enabled it to gain access to the investment needed to enter European markets which, after initial losses, has had considerable success with Innocent becoming the largest fruit juice brand in Europe (Withers 2017; O’Reilly 2015).

With its success in Europe, the potential for access to emerging markets as trade deals are negotiated during the Brexit process and with Coca Cola’s financial backing, Innocent may be able to increase its market share still further.

Threats

Innocent is reliant upon supplies of fresh fruit products for its products (Innocent 2017). The impact of climate change may lead to changes in weather systems, such as floods and droughts, and this will impact on harvests. Furthermore, free movement for EU migrant workers is under negotiation during the Brexit process and there are concerns that this will impact on fruit picking in the UK in terms of access to adequate numbers of workers and the potential additional labour cost (O’Carroll 2016). This is turn may increase the cost of Innocent drinks, which may reduce their demand.

References for SWOT Analysis of Innocent Drinks

• Angwin, D, Cummings, S and Smith, C (2011) The Strategy Pathfinder: Core Concepts and Live Cases, (2nd ed), Chichester: John Wiley and Sons Ltd, Chichester
• Britvic (2016) ‘Britvic Annual Report’ [online] Available from https://www.britvic.com/~/media/Files/B/Britvic-V3/documents/pdf/presentation/2016/Britvic_AR_2016.pdf
• Burn-Callander, R. (2015) ‘Europe finally develops a taste for Innocent’ Telegraph. April 11 [online] Available from https://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/11528922/Europe-finally-develops-a-taste-for-Innocent.html
• Food and Drink Innovation Network (2016) ‘Loyalty and values: a technically strong combination at innocent’ [online] Available from https://www.fdin.org.uk/2016/05/loyalty-and-values-a-technically-strong-combination-at-innocent/
• Innocent (2017) ‘Being sustainable’ [online] Available from https://www.innocentdrinks.co.uk/us/sustainability
• Johnson, G., Whittington, R., Scholes, K., Angwin, D. and Regnér, P. (2014) Exploring Strategy, Text and Cases (10th ed.) Harlow: Pearson Education Ltd.
• Leahy, S. (2017) ‘Innocent Drinks app helps Spain’s strawberry farmers slash water use’ Guardian, May 27[online] Available from https://www.theguardian.com/sustainable-business/2016/may/27/innocent-drinks-app-helps-spain-strawberry-farmers-slash-water-use
• O’Carroll, L. (2016) ‘British strawberries could be wiped out by Brexit, farming leaders warn’ Guardian, July 20 [online] Available at https://www.theguardian.com/uk-news/2016/jul/20/brexit-farm-labour-shortages-fruit-vegetable-harvests-national-farmers-union
• O’Reilly, L. (2014) ‘How Innocent and Coke have influenced each other’ Marketing Week, February 12, [online] Available from https://www.marketingweek.com/2014/02/21/how-innocent-and-coke-have-influenced-each-other/ 
• Withers, I. (2017) ‘Innocent gets a health kick as sales top Tropicana’ Telegraph, July 2 [online] Available from https://www.telegraph.co.uk/business/2017/07/02/innocent-gets-health-kick-smoothie-sales-top-tropicana/