How to Reverse a Declining Business

SodaStream creates and sells home-carbonation systems, competing with Coke and Pepsi. The company was founded in 1903 and by 2000 it had an 85% share of the worldwide home-carbonation market. But in 2007 the company was near bankruptcy with revenue of $136 million. Then a new management team with new ideas and strategies turned it around so that at the beginning of 2013 revenue reached $436 million. Some of their tactics[1] can apply to book publishers trying to turn around their businesses. Here are SodaStream's Top Ten Tactics for a Successful Business Turnaround.

1. The most important thing the new ownership brought to the company was optimism.
2. They redefined their company. It was not about putting bubbles into water. It was about creating a more economical, sustainable and healthful alternative to regular soft drinks.
3. They immediately began to focus on product innovation.
4. Next they focused on distribution - making their innovations available to consumers.
5. Then attention turned to promotion. With a marketing budget at 7% of Coke's they challenged themselves to make every dollar spent have the impact of $20 by generating word of mouth, making ads go viral, creating ambassadors and being provocative.
6. To demonstrate their unique value proposition they created The Cage. This was a cage-like box about the size of a minivan in which they placed discarded soda cans representing those discarded by the average family annually. They displayed these cages in high-traffic locations such as airports.
7. They invested $4,000,000 in an ad at the 2013 Super Bowl. The original ad they created was turned down by CBS because of their relationship with Coke and Pepsi (Pepsi sponsored the half-time show that year.) The vast media coverage generated by that story brought SodaStream millions of dollars in free exposure.
8. It's better to invest in PR than advertising because with PR it's not you talking - it's someone else. That gives the message more credibility.
9. Digital media have completely changed the source and quantity of messaging. As a brand trying to build awareness in efficient ways they decided to stimulate word-of mouth rather then buy reach and frequency.
10. They coordinated their promotion with retailers by providing in-store displays and making sure they had the right products in stock.

[1] SodaStream's' CEO on Turning a Banned Super Bowl Ad into Marketing Gold, Harvard Business Review, January-February 2014, pp 39 - 42