Nantucket Nectars Analysis
Engineering 9
Section Cases
Nantucket Nectars Nantucket Nectars was founded by Tom First and Tom Scott. It is a company that has been built around its “personal” informal corporate structure and as a result of owners’ passion for the venture. Unlike any other product in the market, they created a very high quality product which lead their customers to pay the extra price premium for it. First and Scott wanted their company to grow and in order to do so they had two options: they would come out with a public listing or they would sell- out to Pepsi and Ocean Spray. No matter what, they knew that there would be both advantageous and disadvantageous sides for both of these options. Before we start with analyzing the options, it is very important to understand their business strategy, along with the strengths of their high quality product. By selling their products, First and Scott wanted to sell an image. Considering their innovative marketing strategy, combined with the catchy advertisement campaigns and the provided “story,” they were able to create a market of their own. In addition to this, they provide a very high quality, using pure cane sugar instead of high fructose corn syrup and using four times the natural juice compared to the other brands were using. But considering their size, it was difficult for them to compete in larger markets with larger firms with an immense amount of resources. But, through creating a product and company so different than others, they were able to stay successful in the market, with a goal of expanding their scale of operations. These characteristics of the company proves why Pepsi and Ocean Spray wanted to buy-out the company. But the tough decision here is whether or not sell-out the company. Tom Scott and Tom First compiled a list of “value drivers” which accounts for their success. They built a company with an informal corporate culture as they didn’t have any dress code or specified hierarchy. So, they had to
Section Cases
Nantucket Nectars Nantucket Nectars was founded by Tom First and Tom Scott. It is a company that has been built around its “personal” informal corporate structure and as a result of owners’ passion for the venture. Unlike any other product in the market, they created a very high quality product which lead their customers to pay the extra price premium for it. First and Scott wanted their company to grow and in order to do so they had two options: they would come out with a public listing or they would sell- out to Pepsi and Ocean Spray. No matter what, they knew that there would be both advantageous and disadvantageous sides for both of these options. Before we start with analyzing the options, it is very important to understand their business strategy, along with the strengths of their high quality product. By selling their products, First and Scott wanted to sell an image. Considering their innovative marketing strategy, combined with the catchy advertisement campaigns and the provided “story,” they were able to create a market of their own. In addition to this, they provide a very high quality, using pure cane sugar instead of high fructose corn syrup and using four times the natural juice compared to the other brands were using. But considering their size, it was difficult for them to compete in larger markets with larger firms with an immense amount of resources. But, through creating a product and company so different than others, they were able to stay successful in the market, with a goal of expanding their scale of operations. These characteristics of the company proves why Pepsi and Ocean Spray wanted to buy-out the company. But the tough decision here is whether or not sell-out the company. Tom Scott and Tom First compiled a list of “value drivers” which accounts for their success. They built a company with an informal corporate culture as they didn’t have any dress code or specified hierarchy. So, they had to