Green, natural, ethical, organic, and healthy: The small brands owned by Big Consumer

There are many reasons why a corporation may wish to acquire a GNEOH brand. Firstly, the acquisition may allow a corporation to enter or expand in a new market. Such an acquisition may also improve the perception of the parent company; the GNEOH brand's credentials may start to rub off on the parent company. Finally, such an acquisition can act as a catalyst for change of business practices.

Scope

  • This case study looks at two important factors that prompt acquisitions of GNEOH brands: health and change.
  • Health has driven a number of food and beverage acquisitions in recent years and this case study looks at one: PepsiCo’s acquisition of Naked Juice.
  • The case study also looks at the positive business changes made by companies who have acquired GNEOH brands, including Clorox.

Reasons to buy

Why do corporations acquire GNEOH brands? Do both see a benefit?

How did Clorox improve its operations following the acquisition of Burt’s Bees?

Why did PepsiCo acquire Naked Juice? Where does the company see its future growth coming from?

Companies mentioned

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Table of Contents

OVERVIEW

Catalyst

Summary

HEALTH AND CHANGE MAY PROMPT GNEOH ACQUISITIONS

The food and beverage market has consolidated

Companies acquire GNEOH brands for various sales-improving reasons ...

OVERVIEW

Catalyst

Summary

HEALTH AND CHANGE MAY PROMPT GNEOH ACQUISITIONS

The food and beverage market has consolidated

Companies acquire GNEOH brands for various sales-improving reasons

There have been a large number of acquisitions based on health in recent years

Such acquisitions can prompt positive change

Acquisitions are not always positive

Many brands have been accused of selling out

Such acquisitions walk a fine line

CLOROX BOUGHT BURT’S BEES IN 2007, WITH POSITIVE CHANGES BENEFITING BOTH

Burt’s Bees’ philosophy is ‘The Greater Good’

Burt’s Bees sells predominantly natural goods and has witnessed strong growth

Burt's Bees has a strong brand image as a green company

2020 sustainability goal

Clorox is a diverse multinational

Clorox produces cleaning, household, lifestyle, and professional products

Clorox began to improve its business practices in the 2000s

The acquisition brought about mutual benefits

Clorox has benefited Burt's Bees

Burt's Bees has also had a significant effect on Clorox's operations

Clorox has been named a top reputable company

Burt's Bees has also seen good growth

PEPSICO ACQUIRED NAKED JUICE TO JOIN ITS OTHER GOOD-FOR-YOU BRANDS

Naked Juice makes juices and smoothies

PepsiCo wants to increase its healthy products

PepsiCo sells food and beverage products worldwide

Pepsi has grown its healthy brands

One of the brands PepsiCo acquired was Naked Juice

PepsiCo needs to anticipate consumer shifts in preferences

CONCLUSIONS

The acquisition of GNEOH brands can improve revenues for various reasons

APPENDIX

Definitions

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