2015 case competition on cargill hosted by bain&company

Cargill Inc.2015 Eckhart Consulting Case Competition May 1st

Eric Anna MichaelLucyRoy

Agenda

Background of Cargill

Problem breakdown

Constructing a marketing strategy

Implementation of solution

Performance evaluation

Background of Cargill

Cargill is dedicated to helping people and organizations thrive

North America: 42% of gross investment (highest)

B2B without large retail consumer

presence

Commitment to increasing

transparency

Problem breakdown

Miscommunication about food products from conflicting sources

Change in behavior, leading to higher costs for Cargill and consumers

Hurts Cargill’s mission to feed the world sustainably and affordably

Cargill’s Goal

Cargill is seeking to shape the public

conversation in order to build confidence in what

Cargill supplies, while staying consistent with its business principles.

Approach to Problem

Content

What are effective marketing solutions and tools?

ChannelWhich messengers and allies can we partner with to target the key audience?

Key AudienceWho are key consumers we want to reach?

Key Audience

Key Audiences | Channels | Content

• 76% of women claim to have all or most of grocery shopping responsibility – FMI U.S. Grocery Shopper Trends (2014)

Female

• When people have children, their thinking about food shifts dramatically as they transition from caring about oneself to caring about another growing being. - Hartman Group (2013)

Families with children

Survey Method

132 Whole Foods Market customers at Streeterville store


General food-purchasing

choices

Current most-trusted sources

View of doctors as a potential

source

Current behavior regarding food

seals

View of influence of food seals

Survey Results


Professional Health Experts

Food-related NGOs

Friends and Family

Academics

Social Media

Government

Other

0% 20% 40% 60% 80%70%

33%58%

18%15%

12%24%

What sources do you trust the most when it comes to making food-related decisions? (Pick up to 3)

As a percentage of respondents

Survey Results

Key Audiences | Channels | ContentAs a percentage of respondents

12345

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%9%

3%20%

46%22%

On a scale from 1-5, how much would a doctor’s recommendation regarding food influence your food purchasing choices? 1 being not at all and 5 being

strongly influential

Messengers and Allies


Doctors and NGOs• Have the authority

and trust of the target audience

Cargill• Wants to educate the

public with science-backed facts

Messengers and Allies


Conferences and Workshops

Doctors Pediatrics, Family

Doctors, OB/GYNs

Posters, pamphlets

NGOs Food ethics, health, safety Websites

Survey Results


73%

27%

Do you look for the USDA organic seal or any other non-conventional seals on

products?

YesNo

Survey Results


6%6%

21%

45%

22%

On a scale from 1-5, do these seals change your confidence in the product, with 1 being no change and 5 being strongly confident.

12345

Power of Seals

● “The Organic label is a marketing tool. It is not a statement about food safety.” – Secretary of Agriculture Dan Glickman, December 2000

● Consumer perceptions linked to the USDA Organic Seal were facilitating sales growth, rather than actual standards behind them, and familiarity with the USDA Organic Seal increased confidence (71%). (Strochlic, 2005)

● The USDA Organic Seal increased likelihood consumers would purchase organic foods (48%). This likelihood rose to 55% for survey respondents with children under 18. (Strochlic, 2005)


Current dynamics


High Visibility• Consumers consider

package labels for organic products as the most important in-fluence. - NMI(2008)

Creation of Misconcep-tion

• The public’s high level of trust in USDA Organic Seal created misconceptions that sealed products are healthier. - Academics Review(2014)

Increasing Demand

• Consumers demand that more standards should be presented in “organic” or “natural” seals. - Consumer Re-ports National Re-search Center(2014)

Purchasing influences

Consumers look for specific labels when selecting food and beverages to raise their confidence

Fresh, Natural, Sustainable traits associated with Organic, Non-GMO seals

Label should address underlying, overall concern about health, well-being, and safety

Source: Current State of the Organic Consumer,Hartman Group Webinar Key Audiences | Channels | Content

A New Label’s Standards

Key Audiences | Channels | ContentSource: Consumer Reports Food LabelsSurvey (2014)

Food

• Health• Safety• Natural• Fresh

Ethics

• Socially responsible• Environmentally

friendly• Animal welfare

Differentiating Factor

Current Seals

• Qualifications and meanings not understood, creating a misconception

• Addresses specific food topic• Backed by government,

company, third-parties

New Seal

• Clear, transparent meaning, educating the consumer that these foods meet many standards

• Addresses overall concerns of food safety, health, and ethics

• Backed by NGOs, doctors


Implementation

Education

Educating relevant doctors and NGOs about misconceptions and encouraging them to counter

Saturation

Saturate the market with the seal, starting from grocery products to restaurant menus

Word of Mouth

Spread through friends and family because of the seal’s differentiating factors

Measures of Success

Key audience positively influenced by educational channels• Success of OB/GYNS, pediatricians, family doctors , and NGOs

Increase in sales of products with seals

• Tracks growth and change in consumer confidence level

Increase revenue and reduce costs for Cargill

• Strategies and tactics shape public conversation and consumer behavior

Challenges

Key Audience

• Other demographics may become increasingly important in the future

Channel

• Potential unforeseen reasons for doctors or NGOs to not support us as allies

Content

• Seal may not fully eliminate existing misconceptions

Questions?

Appendix: Survey

12%

9%

24%30%

24%

On a scale from 1-5, how much do you care about purchas-ing non-conventional food (ex: organic, non-GMOs, gluten-

free, pesticide-free, hormone-free, antibiotic-free), with 1 being not caring and 5 being strongly caring

12345

Appendix: Doctors

Source: Food Marketing Institute U.S. Grocery Shopping Trends 2014

79

73

69

54

-6

-6

-7

-4

Which helps you stay healthy, which make it more difficult for you?

Working against me On my sideFarmers

Doctors

My Friends

My Family

Appendix: Doctors

61% of Americans have a “great deal” of trust and confidence in their doctors. (Gallup, 2002)

70% of Americans are confident the accuracy of a doctor’s advice. (Gallup, 2010)

Appendix: Doctors

“Most physicians, physicians’ assistants and nurses said they do not provide food safety education to older adults because there is not enough time to share this information during appointments. However, both groups said they would be willing to provide educational brochures or post food safety information on office bulletin boards if these materials were provided.“ (Educational Gerontology, 2012)

Appendix: Supporting Evidence

“The AMS-funded study concluded that these consumer perceptions linked to the USDA Organic Seal were facilitating sales growth, and that familiarity with the seal but not the actual standards behind them was a dominant factor in determining if a consumer was likely to purchase organic foods.AMS reported the USDA organic seal increased confidence in organic products (71%) and increased likelihood they would purchase organic foods (48%). This likelihood rose to 55% for survey respondents with children under 18. However, 79% of consumers familiar with the USDA organic seal were not familiar with the corresponding National Organic Standards behind it, and 90% believed USDA, not third parties, were responsible for certification. With these significant health, safety and nutrition misperceptions noted, AMS concluded the USDA Organic Seal and marketing program was responsible for increased consumer trust in and willingness to pay more for organic products.” (Strochlic, 2005)

2015 case competition on cargill hosted by bain&company

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