Brita: In Search of a Winning Strategy
The case describes the meteoric rise of Brita in the US market, following the acquisition of local rights by The Clorox Company in 1988, until a sudden decline in 1999. The case details the various failed strategies attempted by the brand between 1999 and 2006 and poses the question as to what should Brita do to turn its fortunes around. The case presents the results of a recent segmentation study, which holds the key to developing the turnaround strategy.
The purpose of the case is to highlight the importance of market segmentation and targeting in the development of strategy. The case makes the point that segmentation needs to be done first, followed by the targeting decision, before one can develop strategy. In choosing among segments, it becomes clear that there are two possible criteria: choose where one is strong or choose where there is maximum potential for growth. The choice criteria would depend on the firm’s objectives. In the case of Brita the objective was double digit growth, clearly pushing the choice of segment in the direction of the segment with maximum headroom. The case also makes the point that the organization needs to be aligned to the segment and the lens that drives the alignment is the brand, or more specifically the brand position. This implies that the whole organization needs to understand the brand position and respond; in this instance the focus is on R&D and its alignment to deliver a series of new products that can reinforce the brand position. The case also highlights the key elements of a good segmentation study: representative and probability sampling, sampling both users and non-users, collecting data on a comprehensive set of variables, including variables that can allow one to reach the target, e.g., media consumption and shopping behavior data.
Support materials include Brita’s various advertising efforts to improve their business and a presentation deck that helps the instructor summarize the key learning points and inform participants of what happened in the end.
The case has been taught in both MBA and executive sessions. With MBA audiences, the case can fit into an introductory marketing course in the session on segmentation, targeting, and positioning. The case can also fit into advanced MBA electives on marketing strategy or branding, where the issue of organizational alignment would receive greater play and one can more broadly highlight the relationship between segmentation and branding and the criticality of undertaking segmentation first. With executive audiences, the case fits into the introductory session of a marketing or branding module.