Launching Krispy Natural: Cracking the Product Management Code

Candler Enterprises

PEMBERTON

BEVERAGE DIVISION

QUICK-SERVICERESTAURANT

PET CAREDIVISION

Pemberton’s sales is $5 billion in $18 billion of Candler’s revenue.

Majority of Pemberton salesFood bars,

Homestyle muffins, doughnuts, softies cookies and other

sweet baked goods.

-Reached 6.9 billion in 2011. -Growth rate of overall market from 2008-2010 was 2.2% -CAGR Crackers with filling sector expected to grow 10-14% in next few years

Cracker Industry in US

Direction for Product Development

Building a collection of attractive durable minds.

DSD systems to increase revenue and profits.

Building or acquiring capabilities in salty snack

categories.

-Natural distribution of crackers -Minimum sales of $500 million -Steady state pre-tax profit of at least 13%

Sales Objective

Strategic Priorities

Building a brand value in the salty cracker industry and brand image in the market

Applies Direct Store Delivery(DSD) distribution system to increase revenue and overall sales.

Direct Store Delivery (DSD)

-Greater control of shelf space -Accurate forecasting-Reduced stock-outs-Quicker turnover of products

Advantages for both Pemberton and retailer:

Creating Brand Value

-Marketed as mobile "Grab and Go" snacks.

-Strong presence in vending machines

convenience store.

-Improve product taste and quality.

-Increasing the package size.

-Made from 100% whole wheat and other

natural ingredients.-Available in 3 flavor options.

Strategies

Push Strategy(Earlier)

Pull Strategy(Now)

-Competitors favored to promote products

-Extensive advertising and merchandising.-Aggressive plans for sales promotion.

Competitor Analysis

Sales

Pepperidge Farm Kellogg Kraft Private label Other

Test Market Result

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% store Count % stores with GandolaPlacement

% stores with End Aisle Display

Columbus Southeast Column1

Crispy Sales Performance

Promotional Plan : Columbus Ohio

MONTH 1 2 3 4 5 6

ADVERTISING Television online Blitz Flighted Television and Online Advertising

SOCIAL MEDIA

Facebook Like Us Campaign

TRADE 15% Discount per

case12 % discount per case

8% discount per case

SAMPLING In-Store Sampling with Coupon

Newspaper sampling:Trial size with Coupon

COUPONING Newspaper Shelf Pad

Electronic Newspaper Shelf PadBUY 2 GET 1

SWOT Analysis1. World renowned product development labs.2. Product mix.3. Company owned DSD1. Market research shows consumer dissatisfaction with favour and taste experience of current cracker brands. 2. Cracker market fundamentals were attractive

1. Capacity constraints of DSD for Krispy natural products. OPPORTUNITIES

1. Fritto-lays entering the cracker market. 2. Modest increase of 1% sale in southeast.

Krispy Natural Re-launch

Indications:- Positive Purchase Intent of 81%. - Over 2:1 ratio in taste preference in crackers with filling, this segment is expected to grow from 10% to 14% in next few years.

National RolloutContradictions:-Flat Crackers taste preference fell below 2:1 ratio compared to competitors, this segment is largest part of market. -Uncertain about Frito-lays entrance into the Market.

Summary

Created by SrishtiMendhekar, MIT, Manipal, during a

Marketing Internship by prof. Sameer Mathur, IIM Lucknow

DISCLAIMER