Giant Consumer Products (Gcp)
| Giant Consumer Products (GCP) | | |
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A. Situation Analysis:
1. Context: In early September’08 Giant consumer Products, Inc. (GCP) realized that Frozen food division, which had been growing at 2.8% (compounded annual growth) rate since 2003 to 2007 and accounted for almost 33% of GCP’s overall business volume, is not doing well now. The sales as well revenue volume is around 3.9% behind the target. Most specifically marketing margin (key parameter for GCP business) was also under plan by 4.1%. GCP had been doing well in wall-street but performance of past couple of quarters has increased the worries of GCP i.e. whether GCP will able to maintain its profitable growth.
GCP is expecting FFD to deliver the sufficient growth to match up with the annual targets. VP of GCP suggested CEO of GCP for the sales promotion of the FFD; however the CEO has some of his apprehensions against the sales promotions. Nonetheless he agreed to allocate some funding if FFD team comes up with a solution generating funds without affecting long term health of the GCP’s brand. Mark Sanchez was assigned the job to analyze the data and give his factual recommendations on the following line: a) Whether the national sales promotion is to be done for increasing the volume, profit from FFD? b) If promotion to be done and is profitable then would the same be profitable for GCP, retailer as well as consumer or not? To which brand the funds should be allocated is another question to be answered? c) How should the promotion be implemented? 1. Off invoice pricing 2. Pay on performance 3. Prefixed target based compensation.
2. Consumers: The emergence of dual career families resulted in unavailability of sufficient time to cook food. Hence interest and love towards such frozen food is increasing. Moreover most of the consumers has become deal conscious and wait for the promotions. Among various frozen food consumers’ product selection hierarchy is in following manner:
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A. Situation Analysis:
1. Context: In early September’08 Giant consumer Products, Inc. (GCP) realized that Frozen food division, which had been growing at 2.8% (compounded annual growth) rate since 2003 to 2007 and accounted for almost 33% of GCP’s overall business volume, is not doing well now. The sales as well revenue volume is around 3.9% behind the target. Most specifically marketing margin (key parameter for GCP business) was also under plan by 4.1%. GCP had been doing well in wall-street but performance of past couple of quarters has increased the worries of GCP i.e. whether GCP will able to maintain its profitable growth.
GCP is expecting FFD to deliver the sufficient growth to match up with the annual targets. VP of GCP suggested CEO of GCP for the sales promotion of the FFD; however the CEO has some of his apprehensions against the sales promotions. Nonetheless he agreed to allocate some funding if FFD team comes up with a solution generating funds without affecting long term health of the GCP’s brand. Mark Sanchez was assigned the job to analyze the data and give his factual recommendations on the following line: a) Whether the national sales promotion is to be done for increasing the volume, profit from FFD? b) If promotion to be done and is profitable then would the same be profitable for GCP, retailer as well as consumer or not? To which brand the funds should be allocated is another question to be answered? c) How should the promotion be implemented? 1. Off invoice pricing 2. Pay on performance 3. Prefixed target based compensation.
2. Consumers: The emergence of dual career families resulted in unavailability of sufficient time to cook food. Hence interest and love towards such frozen food is increasing. Moreover most of the consumers has become deal conscious and wait for the promotions. Among various frozen food consumers’ product selection hierarchy is in following manner: