TruEarth Healthy Foods: Market Research for a New Product Introduction Case Analyses:
* Isabel Eckstein the brand manager had let the introduction of the most successful product of the company (Pasta Kit) in 2006 which means that she has a very strong marketing background. * Competitors began offering similar products in 2008 which cause the growth to slow. * Some of their competitors are Nestle and Kraft.
* The do not make a rash decision. The success of Cucina Fresca was a calculated risk based on significant research. * The company only uses high-quality durum wheat and mostly organic ingredients. * The company further raised consumer awareness through several promotional programs, using coupons, magazine advertisements, and in-store demonstrations. * Idea generation. As the company grew, the idea generation process became a more systematic evaluation of consumer trends, with formal management brainstorming sessions. * Three important developments reshaped how consumers purchased groceries. The first important trend was a new, loosely defined food category in the United States— “home meal replacement” (HMR). An increase in dual-income households had led to higher disposable incomes coupled with “time poverty,” as both workers found themselves lacking the time to cook a meal and clean up afterward. Further, consumers had tired of unhealthy carryout and fast food and started seeking greater variety and freshness. Supermarkets began meeting HMR needs by enhancing their fresh, prepared food offerings. * There was no fresh whole grain pasta with broad distribution, with 85% of those in favour of the concept having never purchased it before. * Competitive Threat: Rigazzi Fresh Whole Grain Pasta.
* Pizzas were a core component of the Italian-American food category, with annual sales in the United States estimated at $53 billion in 2007. * suggested that 77% of consumers ate pizza at least once a month. * The store-bought refrigerated pizza market was 11% of sales and totaled $5.8 billion, making it a larger market than refrigerated pasta, which was approximately $4.4B in 2007. * pizza demand in key demographics had been hurt by health concerns and the popularity of diets that restricted or cut out carbohydrates. Eckstein believed this presented the perfect opportunity for TruEarth. * Independent surveys of restaurant-goers showed that 33% of people had “strong interest” in a whole grain crust. * Major chains like Papa John’s and Pizza Hut had introduced whole wheat or multi-grain crusts * Kraft and Nestle are already huge players here with low-cost frozen pizza.
RECOMMENDATION HAI YE FUU
January 11, 2009
Introduction of Whole Grain Pizza Product
The slowing growth of Cucina Fresca’s sales has placed our competitive edge in the fresh Italian food category in jeopardy. In an attempt to retain our leadership position and extend our product line, we have invested in the development of a new whole grain pizza. We must decide whether to launch our pizza offering. Our decision must take into consideration that the new product’s wholesales volume estimates must exceed $12 million to meet our return requirements. The decision-making process is time sensitive because one of our competitors, Rigazzi Brands, has already tested a whole grain pizza concept and is not far from introduction. Given these factors, we can either debut or suspend the product. Based on sales volume estimates and situation analysis, I recommend that the company launch the pizza. The introduction will result in a wholesales volume that exceeds our return requirements and these additional funds can be reinvested into the firm. Option I: Launch Whole Grain Pizza Product
The launch of a whole grain pizza kit will capitalize on the same consumer trends that prompted the release of Cucina Fresca: growing demand for quick,...
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