launching krispy natural cracking the product management code 1
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Launching Krispy Natural: Cracking the Product Management Code
PROBLEM OF THIS CASE
ABOUT PEMBERTON
1) Pemberton was the snack food division of Candler Enterprises, a multinational beverage and snack goods manufacturer
2) The majority of Pemberton’s sales were from packaged food bars, cookies, and other sweet baked goods
3) Pemberton contributing approximately $5 billion in sales
•Acquisition of Krispy Inc. in 2008 – First step to enter Salty Snack Market
DIRECTION FOR PRODUCT DEVELOPMENT
Building a collection of attractive and durable brands
Leveraging leading marketing, sales and DSD systems to increase revenue and profits
Building or acquiring capabilities in salty snack categories
WHAT IS DSD?
Direct store delivery (DSD) is the term used to describe a method of
delivering product from a supplier/distributor directly to a retail store, thereby bypassing a retailer's distribution center. DSD products are typically, but not always, fast-turning,
high velocity, and high consumer demand merchandise.
REASON FOR ACQUIRING KRISPY NATURAL-- US CRACKER INDUSTRY
•Growth of 6.2% in General(All other) in 2010
•Annual growth forecasted between 10-14% for crackers with filling estimated 6.9 billion in 2011
•CAGR of 2.2% from 2008 – 10
A Mintel study of salty snacks in the United States reported that 74% of respondents consumed crackers on a regular basis and 34% ate them as part of regular weekly diet
2009 Krispy Single-Serve S ales Performance vs. Plan ($ millions)
Plan 2009 Actual % to Plan
Krispy Retail $97.50 $50.80 52.10%
Krispy Vend $23.40 $18.00 76.90%
Total Krispy Single-Serve
$120.90 $68.80 56.90%
KRISPY 2009 BAD PERFORMANCE
AFTER IT’S FAILIURE IN 2009 MARKETING SURVEYS AND PLANNING WERE DONE IN ORDER TO RELAUNCH THE PRODUCT
RESULT OF MARKETING CAMPAIGN
KRISPY NATURAL PRODUCT STRATEGY
•Increasing Package sizes to Multiple serving
Improving taste by introducing new flavors
•Healthfulness – An important Factor
100% whole wheat
Natural Ingredients
MARKETING STRATEGY
•PULL STRATEGY- 1) Focus on Extensive advertising & merchandising2) Aggressive plans for Trade promotions
•PUSH STRATEGY1) Competitors favored to promote products
COMPETITOR ANALYSIS
SALES ANALYSIS AND POTENTIAL
SWOT ANALYSIS
COMPETITIVE RESPONSE TO NEW BRAND“FRITTO LAY”
Optimization of DSD system for Krispy natural product for cost reductions to a more wider level and expansion
Launching more new product mix as per customer taste and keeping health as a priority concern
CONCLUSION
The large chain headquarter buyers were impressed with the consumer research results and inventory turn estimates.
They also loved all the promotional activity and consumer advertising.
However one industry analyst thought that the positive test market results were driven by significant price discounts, couponing, and sampling, which were not sustainable.
Also, few felt the taste preference claims of Krispy Natural were inflated and the flavor was no better than current brand offerings
THANK YOU-ANIMESH MISHRA IITK IIM MARKETING INTERN
DISCLAIMERThese slides have been prepared by Animesh Mishra,IIT Kanpur under the guidance of Professor Sameer Mathur during an internship of marketing management
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