Title

Hill’s Pet Nutrition

AnalystsAbenaa AmpratwumMylissa BlanggerBrian CostelloMike GeromeHeather McKnightBen Perkins

AGENDA

• Brief Background Problems

• Internal Analysis

• External Analysis

• Recommendations

MissionMission Statement

Our mission is to enrich and lengthen the special

relationship between owners and their pets by providing the best pet nutrition in the world.

BackgroundBackground

• Dr. Mark L. Morris Formulated Hill’s Science Diet more than 60 years ago.

• The Company was Inspired by a Guide Dog.

• Parent Company Colgate Palmolive

• Hill’s is currently following a niche strategy

• Two Product Lines- Hill’s Science Diet & Hill’s Prescription Diet

Problems

                                                                                                             

Problems• Losing market share in our niche market

• Narrow product line relative to competitors

•No presence in retail food markets

•Saturated niche market

•Lack of effective advertising campaign

SWOT AnalysisSWOT AnalysisSWOT AnalysisStrengthsStrengths

•Support vet schoolsSupport vet schools

•Top seller in veterinary clinicsTop seller in veterinary clinics

•Experienced workforce (vets)Experienced workforce (vets)

•Brand imageBrand image

•Company reputationCompany reputation

•Better product quality versus competitorsBetter product quality versus competitors

SWOT Cont’dSWOT Cont’dSWOT Cont’dWeaknessesWeaknesses

•Narrow product lineNarrow product line

•Not distributed to retail food storesNot distributed to retail food stores

•Low brand awarenessLow brand awareness

SWOT Cont’dSWOT Cont’dSWOT Cont’dOpportunitiesOpportunities

•Expand product line Expand product line

•Gain market share from growth marketsGain market share from growth markets

•Steal market share from existing high Steal market share from existing high volume areasvolume areas

•Increase brand awareness through media Increase brand awareness through media outletsoutlets

SWOT Cont’dSWOT Cont’dSWOT Cont’d

ThreatsThreats

• Loss of sales to substitute productsLoss of sales to substitute products

• Increasing intensity among competitionIncreasing intensity among competition

• Brand image could suffer due to new Brand image could suffer due to new product linesproduct lines

US Pet Food Market Share 1998

Alpo 7%Others 10.6%Friskies 28.5%Purina 24%Heinz 18.1%Kalkan 11.8%

US Market Trends and Forecasts

Other 21%Dog Food 48.1%Cat Food 30.9%

US Pet Food Market Segmentation .(market share)

US Market Trends and Forecasts

Market forecast

0

2000

4000

6000

8000

10000

12000

in millions

Growth is continuous at 0.1% per year

US Pet Food Market Forecast (1999-2004)

DistributionUS pet food sales by retail type for 1997* ($ mil)

Grocery store 5,365 Mass market 1,418 Pet specialty store 1,403

Distribution

Distribution SurveyDistribution SurveyWhere do you buy pet food?

54%38%

3%

5%

SupermarketPet storeVetOther

Brand Recognition

                                                                                                             

Brand Recognition Survey

Brand Recognition

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Hill's ScienceDiet

No

Yes

Are you familiar with these brands of pet food?

Consumer AnalysisConsumer Analysis

35%

25%

20%

15%

5%

IngredientsVet RecommendationTasteBrandPrice

What is most important when choosing a brand of pet food?

Porter’s 5Porter’s Five Competitive Forces

HIGHRivalry Among

competing Sellers

High Barriers to

Entry

ModerateBuyer Power

LOWThreat of

Substitutes

HighSupplierPower

Perceptual MapPerceptual Map

MARS Inc.

IntroductionStrategyStrategy•Introduce new cat/dog product lineIntroduce new cat/dog product line

•Hill’s GeneralHill’s General

•Placement in mass retailersPlacement in mass retailers

•Specific regions Specific regions

•Competitive pricesCompetitive prices

•Keep Hill’s nameKeep Hill’s name

Dog top 5

29%

29%

15%

15%

12%

NYCLASASCPhila

Dog Food: Top 5 MarketsSales in Millions

Integrated Resource Inc. 1998

Dog growth

29%

19%

9%

15%

28%

SARaleighMISSATLSC

Sales in Millions

Dog Food: Top 5 Growth Markets

Integrated Resource Inc. 1998

Cat top 5

33%

29%

13%

13%

12%

NYCLAPhilaBostonBalt/DC

Cat Food: Top 5 MarketsSales in Millions

Integrated Resource Inc. 1998

Cat growth 5

32%

25%10%

15%

18%

Miami/FLSAJacksonPITTORL

Cat Food: Top 5 Growth MarketsSales in Millions

Integrated Resource Inc. 1998

StrategyStrategy Continued

•AdvertisingAdvertising

•TelevisionTelevision

•RadioRadio

•MagazinesMagazines

•InternetInternet

•Promotions Promotions

•CouponsCoupons

•Direct mail/Informational PacketsDirect mail/Informational Packets

•Free SamplesFree Samples

•Pet SeminarsPet Seminars

Strategy ContStrategy ContinuedStrategy Continued

•SponsorshipsSponsorships

Society for the Society for the protection from cruelty protection from cruelty towards animalstowards animals

•Dogs ShowsDogs Shows

HILL’S GENERAL

Introducing

Available in a Supermarket near you

Thank You

Thank You