The CEO and president of Dr Pepper claims that all the evidence thus far signals that customers are 'thrilled to death' with the firm’s controversial new ‘men-only’ low-calorie drink Dr Pepper Ten.
Discussing Dr Pepper Snapple’s results for the third quarter (Q3) of 2011, Larry Young was discussing the drink’s performance following its October 10 launch.
Overall, Dr Pepper Snapple reported turnover for the 3 months ending September 30 2011 of $1.529bn (€1.097bn), up from $1.457bn (€1.045bn) during the same period in 2010.
But Dr Pepper sales were ‘flat’ compared with 2 per cent growth during Q3 2010, although Canada Dry, Squirt, 7UP and A&W, Crush and Sunkist soda volume sales all grew.
Bold taste and 10 calories
During the first 9 months of 2011, the company’s income from operations fell to $753m (€540.6m) compared with $757m (€543m) in 2010, but net income grew from $416m (€298.6m) to $440m (€315.8m) for the equivalent 9 months.
Answering questions from analysts on Ten, Young said the firm was pleased with sales thus far, but didn’t yet have enough data to really assess the drink’s performance.
“But everything we’re seeing, everything we’re hearing, not only from bottling partners, but customers and consumers, they are thrilled to death with it,” he said.
“We’re bringing people into the Dr Pepper trademark that had left…They’re coming back in because of the great taste, the bold taste and the 10 calories,” Young added.
Moreover, test market launches showed that Ten had not cannibalised conventional diet or normal Dr Pepper sales, Young insisted, with conventional products sales also accelerating.
Test market sales saw Ten achieve around 5 per cent of total trademark sales, Young said, a figure he described as “very encouraging whenever you test market to the regular and diet group”.
Perhaps with a nod to recent controversy about Dr Pepper’s marketing strategy – positioning Ten as a ‘just for men’ product, with “10 bold, manly calories” – Young said this was just “tongue-in-cheek”. A still from Dr Pepper's website advert for Ten is pictured.
He added: “We’re seeing across the board, people excited about the brand, buying the brand, consuming the brand.”
Young said: “And I think we’ve just kind of scratched the surface of where this can go because moms are even picking it up for children to put back in the home, because there’s only 10 calories in there, when there were not in carbonated soft drinks before.”
Due to the focus on getting Ten right, Young said that nothing else would immediately emerge from the Dr Pepper Snapple product pipeline. “We want to stay very focused on Dr Pepper Ten right now,” he said.