Tyler Pet Foods - Case Analysis

PROBLEM STATEMENT Tyler Pet Foods, Inc. met with representatives of Marketing Ventures Unlimited to discuss possible entry into the household dog food market in the Boston Massachusetts metropolitan area. The meeting raised the question: "Is there a place for Show Circuit in the dog food market?" COURSES OF ACTION After the meeting, Tyler Pet Foods had several unanswered questions: 1. Was the market itself adequately defined and segmented? 2. What position would Show Circuit seek in the market? Should the program be targeted toward all dog food buyers? 3. Could the food brokers get distribution in supermarkets given the sales program? 4. What should be TPF's recommended selling list price to the consumer for Show Circuit? 5. Could TPF at least break even in the introductory year and achieve a 15% return on sales in subsequent years? Upon answering these questions, TPF must consider the general media strategy as to implementing Show Circuit.

The market has been adequately defined with the target market of married couples and singles between the ages of 21 and 50 years of age with an income greater than $25,000. This is a target market that would spend money on a premium product for a "family member." However, TPF must consider the profitability of such a market. Show Circuit will be marketed as a high-quality food. Show Circuit is also quite different from other dog foods in that it is a frozen dog food. The problem lies in getting room on frozen food shelves next to people foods. Frosty Paws, a frozen dog treat, has done some of the pioneering work by gaining some freezer space in Boston supermarkets. It is possible that TPF may have to give up more than a 25% gross margin to get freezer space. Assuming that food brokers do get distribution into supermarkets, the following breakdown shows recommended selling prices (as well as, variable costs and contribution margins).

Price to consumer: based on the notion that Show Circuit will be sold as a premium priced item