Beechnut: Extreme Decline In Baby Food Products
Business Proposal
Centi, K.,
ECO / 561
May 5, 2014
Bobbie Murray
Beechnut baby foods have recently marketed and launched a new product line. After years of the decline in baby food products, Beechnut realized that many moms in this millennium have begun to make their own baby foods. This trend was reflected in the opposition to purchasing concentrated and processed foods from popular baby brands. As a result, Beechnut developed a new line of 100% natural products. The catalyst for this new product was the extreme drop in ounces of baby food that a baby had in 2012 versus 2005. According to Beechnut 's research and interviews with new moms, these consumers believed that the homemade food was the best and healthiest option for their baby. …show more content…
In the United States, the food market for baby food in jars only consisted of three competitors. Gerber who was number one and had a market share of 65%, Heinz with a share of 17.4% and Beechnut with a 15.4% market share (Strom, 2014). However, with the influx of natural food and organic baby food trends, Beechnut can also be defined as a Monopolistic competition. This is an imperfect competition that has many producers which sell products that are differentiated from one another either from the branding or quality and, therefore, do not render perfect substitutes. In monopolistic competition, a firm takes the prices charged by its rivals and ignores the impact of its own prices on the prices of other firms (Stroux, …show more content…
The introduction of Beechnuts all natural baby foods are a corporate strategy to increase sales volume for new products and new markets. Diversification is often the expansion into a new area of the industry (here organic baby products) that the business is already in, or investing in a promising business outside of the scope of the existing business According to Igor Ansoff 's Product Market matrix,
Here, the first three concepts often are pursued with the same technical, financial, and merchandising resources that are used for the original product line. However, as in Beechnuts new scientific process that eliminates absorbic acid in its baby food products, it is a form of diversification. Diversification usually requires a company to acquire new skills, new techniques and new
Centi, K.,
ECO / 561
May 5, 2014
Bobbie Murray
Beechnut baby foods have recently marketed and launched a new product line. After years of the decline in baby food products, Beechnut realized that many moms in this millennium have begun to make their own baby foods. This trend was reflected in the opposition to purchasing concentrated and processed foods from popular baby brands. As a result, Beechnut developed a new line of 100% natural products. The catalyst for this new product was the extreme drop in ounces of baby food that a baby had in 2012 versus 2005. According to Beechnut 's research and interviews with new moms, these consumers believed that the homemade food was the best and healthiest option for their baby. …show more content…
In the United States, the food market for baby food in jars only consisted of three competitors. Gerber who was number one and had a market share of 65%, Heinz with a share of 17.4% and Beechnut with a 15.4% market share (Strom, 2014). However, with the influx of natural food and organic baby food trends, Beechnut can also be defined as a Monopolistic competition. This is an imperfect competition that has many producers which sell products that are differentiated from one another either from the branding or quality and, therefore, do not render perfect substitutes. In monopolistic competition, a firm takes the prices charged by its rivals and ignores the impact of its own prices on the prices of other firms (Stroux, …show more content…
The introduction of Beechnuts all natural baby foods are a corporate strategy to increase sales volume for new products and new markets. Diversification is often the expansion into a new area of the industry (here organic baby products) that the business is already in, or investing in a promising business outside of the scope of the existing business According to Igor Ansoff 's Product Market matrix,
Here, the first three concepts often are pursued with the same technical, financial, and merchandising resources that are used for the original product line. However, as in Beechnuts new scientific process that eliminates absorbic acid in its baby food products, it is a form of diversification. Diversification usually requires a company to acquire new skills, new techniques and new