LAUNCHING KRISPY NATURAL: CRACKING THE PRODUCT MANAGEMENT CODE
LAUNCHING KRISPY NATURAL:
CRACKING THE PRODUCT MANAGEMENT CODE
A U.S. Retail cracker sale is an industry with the volume of $7 billion, consisting of 3 main brands: Kraft Food Inc., Kellogg Co and Pepperidge Farm, which cover almost 75% of the market. Pemberton, the snack food division of Candler Enterprises competes with these brands and offers the customers packaged food bars, cookies, muffin and doughnuts with superior experience of taste. On this goal, they aim to create better products: Their recipes are being improved and new products; new flavors are continuously being put in the market.
Pemberton is strong on their innovative side. They utilized direct store delivery (DSD) distribution system allowing them to directly deliver to retail outlets. This system maximized sales and profit growth. In order to meet their long-term objectives, their three key strategic priorities include benefiting from this system - making their marketing and sales a leverage; as well as building a collection of attractive, durable brands and acquiring capabilities in salty snack categories. (Cespedes & Beckham, 2013)
The recent reports show that the shares of the top three brands are declining. This drift is the direct effect of the consumers’ desire to purchase more of the healthier products in the market. As the recent surveys state, in a population which 70% of the consumers’ are working to improve their physical health, such an effect on the market is inevitable. (Cespedes & Beckham, 2013)
The crackers-with-filling has been the strongest segment growth in the market in 2010 with 14%. Seeing this as an opportunity, Krispy made 3 available flavor options for the consumers and marketed their products as mobile with strong presence in vending machines and convenience stores. Pemberton hoped to increase volume with wider distribution on supermarkets with better visuals / displays was necessary however, they were 30% behind of the projected sales performance.
CRACKING THE PRODUCT MANAGEMENT CODE
A U.S. Retail cracker sale is an industry with the volume of $7 billion, consisting of 3 main brands: Kraft Food Inc., Kellogg Co and Pepperidge Farm, which cover almost 75% of the market. Pemberton, the snack food division of Candler Enterprises competes with these brands and offers the customers packaged food bars, cookies, muffin and doughnuts with superior experience of taste. On this goal, they aim to create better products: Their recipes are being improved and new products; new flavors are continuously being put in the market.
Pemberton is strong on their innovative side. They utilized direct store delivery (DSD) distribution system allowing them to directly deliver to retail outlets. This system maximized sales and profit growth. In order to meet their long-term objectives, their three key strategic priorities include benefiting from this system - making their marketing and sales a leverage; as well as building a collection of attractive, durable brands and acquiring capabilities in salty snack categories. (Cespedes & Beckham, 2013)
The recent reports show that the shares of the top three brands are declining. This drift is the direct effect of the consumers’ desire to purchase more of the healthier products in the market. As the recent surveys state, in a population which 70% of the consumers’ are working to improve their physical health, such an effect on the market is inevitable. (Cespedes & Beckham, 2013)
The crackers-with-filling has been the strongest segment growth in the market in 2010 with 14%. Seeing this as an opportunity, Krispy made 3 available flavor options for the consumers and marketed their products as mobile with strong presence in vending machines and convenience stores. Pemberton hoped to increase volume with wider distribution on supermarkets with better visuals / displays was necessary however, they were 30% behind of the projected sales performance.
References: Cespedes, Frank V. & Beckham, Heather. (May 2013) Launching Krispy Natural: Cracking the Product Management Code. Spreadsheet Supplement 913-576. Harvard Business School. Allston, MA.