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Launching Krispy Natural :Cracking the product management code
Pemberton products
All of the shortcomings were addressed :
• R&D labs were engaged to improve taste and quality.
• Product line was extended beyond single serving line to multiple serving lines.
• It was repositioned as “Krispy Natural” which connected better with the consumers.
Krispy Single Serve
Krispy Natural
• Regional brand• Limited flavour
options• Limited product line
• Multiple serving packages
• Targeting health conscious consumers
• More flavour options and better taste experience through research
Plan Actual % to planKrispy Retail $97.5 $50.8 52.1%
Krispy Vend $23.4 $18.0 76.9%
Total Krispy Single - Serve
$120.9 $68.8 56.9%
2009 Krispy Single – Serve Performance vs. Plan ($
millions)
Strategic Priorities
Marketing, sales and DSD systems
Marketing ApproachHeavy advertising and
promotionPull strategy
Direct Store Delivery(DSD)Greater control of shelf space
Accurate forecastingReduced stock outs
Quicker turnover of products
Capabilities in salty snack categories
High desire for healthy products
74% consume crackers on a regular basis
34% consume crackers as a part of regular weekly diet
Competitors analysisKraft, Kellog, Pepperidge farm,
others
Attractive and durable brands
Marketed as mobile grab and go snacks
Improve product taste and quality
Increasing the packaging size
Available in three flavours
Product Strategy
New flavours
Multiple Serve packaging and improving taste
Use of 100% whole wheat and other natural ingredients to promote healthy lifestyle
R&D lab worked tirelessly to reformulate the product
Product testing summary
Marketing Strategy
Push Strategy :Competitors favoured to promote products
Marketed it as “Grab and Go” with a major presence in vending machines and
convenience stores
Pull Strategy :Focus on extensive advertising and
merchandising
Aggressive plans for trade promotions
Six month period promotional plan, 2011
Distribution strategy
Effective DSD distribution
Optimizing system for longer shelf line of crackers
Hired representatives known as “Krispy force” for systematic distribution
Pricing Strategy
Krispy went for a premium pricing strategy
But on a “visual price” basis, Krispy would be on par with the competitors as the retail
price would remain same as the competitors
Provide less quantity or weight in each Krispy Natural package.
Sales Objectives
National distribution of crackers
Minimum sale of $500 million
Steady state pre-tax profit of at least 13%
Partial competitive analysis
2:1 ratio in taste
preference
World renowned R&D labs
Pemberton is already a market leader in USA
Capacity constraints of DSD for Krispy natural products
Strengths Wea
knes
s
Cracker market fundamentals are
attractive
Market research shows consumer dissatisfaction with flavour and taste of
current other brands
Modest increase of sales by 1% in south
east
Frito lays entering into the market
Opportunitie
sTh
reat
s
Conclusions
• Grabbed 18% market share in Columbus as a new entrant in salty snacks business
• Others in total lost 10% of market share, despite of higher cracker product demands
• Forecasted National roll out sales figure in Columbus and southeast scenario for third year depicts PBT (Profit before tax) more than 13% and sales more than $500 millions.