Snapple 2010 Annual Report Download - page 4

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Our brands are the fundamental
ingredient of our success.
DR PEPPER SNAPPLE GROUP 2010 ANNUAL REPORT
2
Growing Our Brands
Macroeconomic conditions remained a major
challenge in 2010. Although consumer
spending was weak, our brands proved, as
always, to be the fundamental ingredient
of our success. We continue to find new ways
to win, activating unique programs with retail
customers and aligning with our bottlers to
grow profitable volume.
It was a historic year for Dr Pepper as the brand
celebrated the 125th anniversary of its debut at
Morrison’s Old Corner Drugstore in Waco, Texas.
The brand’s proud fountain tradition continued
in 2010 as our fountain foodservice volume grew
5 percent based in large part on increased
Dr Pepper availability. All told, Dr Pepper bottler
case sales volume increased 3 percent last year.
It was also a great year for Snapple, with volume
up 10 percent. Diet Snapple Trop A Rocka,
created as a limited-time offering with the help of
“The Celebrity Apprentice,” became a permanent
member of our lineup. With the introduction
of consumer-preferred six packs, we gained
distribution in grocery. And value teas and juice
drinks in 16-oz. cans further expanded our reach.
Our namesake brands are just two of the highlights
from our product portfolio in 2010. Mott’s and
Hawaiian Punch were also standouts. Mott’s
grew 3 percent on the continued success of
Mott’s for Tots and the beginning of our westward
expansion. Hawaiian Punch grew 6 percent
based on strong promotional activity in grocery
and dollar channels.
Among our Core 4 brands, Canada Dry grew
double digits, benefiting from an increase in
retail displays and a rise in brand equity measures
fueled by advertising and on-pack messaging.
This growth was more than offset by decreases
in Sunkist soda, 7UP and A&W volumes, resulting
in a 1 percent decline in our Core 4 portfolio. Crush
grew high double digits in its second year as a
national brand, increasing on all brand equity
measures and becoming the fastest-growing
CSD on the market.
Growing Shareholder Value
Our strong cash flow has enabled us to reinvest
heavily in the business to drive growth and
efficiencies, forming the foundation to increase
shareholder value. We focus our efforts on
three key areas:
•฀ Build our brands
We direct most of our sales and marketing
resources to three main categories: flavored
CSDs, teas and juices. In the next section
of this report, Jim Trebilcock, our head of
Marketing, and David Thomas, our head
of Research & Development, share how
our portfolio strategy and commercial
innovation are aligned to create products
and programs that resonate with shoppers
and excite our customers.