Marketing of Hardbite Chips Essay Example
Marketing of Hardbite Chips Essay Example

Marketing of Hardbite Chips Essay Example

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  • Pages: 11 (2770 words)
  • Published: August 28, 2018
  • Type: Case Study
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Mass merchandisers and wholesale club stores have surpassed convenience stores in market share in Canada, but food stores have not been impacted. In 2007, sales of snack food alone reached over $1.8 billion for retail grocery stores in Canada, with potato chips accounting for approximately $550 million of that total. This consistent trend demonstrates a 6% annual growth rate for retail potato chip sales. Consequently, companies are entering specialized markets by offering unique flavors and organic choices.

Despite the presence of big corporations, the Canadian snack food industry has experienced an increase in new entrants in recent years. These corporations have significant competitive advantages in terms of cost due to economies of scale and the ability to maintain majority market share through massive advertising budgets. Frito-Lays, a division of PepsiCo., is the leader in this industry, o

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ffering various chip varieties and flavors through multiple SBUs. However, smaller companies have the opportunity to target niche markets. In 2006, 106 Canadian snack food manufacturers shipped $1.6 billion worth of products. Nevertheless, big corporations such as Frito-Lays are starting to recognize the potential of these markets and expanding into them, as evidenced by the introduction of their Wasabi flavored chips.

Also available at popular stores like London Drugs, Shoppers Drug Mart, Overwaitea, and IGA Marketplace locations are well-known and sold throughout BC. There are opportunities and threats in the market, such as the expanding market and the Provincial Government policy that bans junk food sales in elementary and high schools. Many consumers are becoming more interested in environmentally-friendly products, but there is also the possibility of larger competition entering the market. Additionally, many consumer

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are concerned about health and there is the presence of an economic recession. However, this creates an opportunity to target niche ethnic markets despite the challenge of acquiring capital. It is difficult to persuade people to spend money on unknown premium brands due to low brand loyalty among consumers in the industry. In terms of competitive analysis, we aim to position Hardbite Chips as a high-quality potato chip brand in the minds of consumers. We want to leverage the common consumer assumption that quality and price are related. We believe that Hardbite Chips has the potential to develop a unique competitive advantage and our main focus is serving health-conscious consumers.

To target health-conscious consumers, our main selling point is highlighting the healthy features of our product. Our potato chips are made entirely from natural ingredients and contain no trans-fats. Hardbite Chips was among the pioneers in entering the expanding market for healthy potato chips, and we have since broadened our distribution channels beyond health food stores. This expansion has aided us in establishing brand recognition among those who were early adopters of healthy snacks. With the growing number of consumers purchasing healthier snacks, we anticipate that these early adopters will recommend our product, thus contributing to the growth of our brand.

Furthermore, our product has an advantage over many competitors as it is not cooked at high temperatures that produce acrylamide, a potential carcinogen found in baked and fried carbohydrates. Many potato chips on the market contain acrylamide. Additionally, Hardbite Chips differentiates itself by using unique ingredients like Himalayan salt, which adds nutrients while keeping sodium levels low. This aspect can attract health-conscious consumers, especially

those with high blood pressure. Another selling point that Hardbite Chips can leverage is appealing to environmentally conscious consumers due to our commitment to being an eco-friendly company.

Our company sources locally grown potatoes and spices and our packaging comes from a local manufacturer. By emphasizing these facts, we aim to attract environmentally conscious consumers who share similar values. With the increasing popularity of the "green" movement, we believe we are well-positioned to seize a significant portion of this expanding market. Additionally, our distinct flavors could serve as an unique selling proposition and appeal to specific ethnic groups. While we strive to create flavors that will be enjoyed by all, we recognize that certain ethnic communities may find some of our flavors particularly appealing due to their familiarity with them.

The popularity of our coconut and curry flavored chips in Thailand may be due to the common use of coconut milk in Thai curry recipes. We aim to broaden our range of distinct flavors and draw inspiration from traditional ethnic cuisines. This will enable us to cater to Canada's diverse ethnic communities as well as more traditional potato chip consumers. Our segmentation strategy focuses on psychographic factors, including consumer motivations, personality traits, lifestyle choices, and geographic location when analyzing the potato chip market.

Our target audience is the person responsible for grocery shopping for their family, typically a parent, especially working parents raising children in urban areas. To segment this audience, we consider their personality, lifestyle, and the activities they engage in. We aim to reach individuals who lead busy lives with packed schedules and seek healthy food options but lack the

time to compare products themselves. Furthermore, our target audience consists of parents who prioritize providing their children with nutritious snacks that are also enjoyable for them.

By using geodemographics, we can customize our ads to match specific ethnic neighborhoods. This target audience is perfect for our product since it fulfills their needs and is likely to attract them. Additionally, because this group usually handles most of the family's food purchases, our product will be seen by their children as well. This will increase brand recognition and boost sales in other market segments. The main challenge we expect when targeting this segment is finding appropriate and effective media channels to reach them. This audience balances work and family duties, which often takes up a significant amount of their time.

The target audience for snack food may not pay attention to advertisements for various brands, and they often have distractions that divert their focus away from our ads. Our marketing objective is to increase consumer awareness of our product by 30% in the next year. As our product is still relatively unknown and our company has mainly focused on expanding production facilities, we believe it is a suitable time to intensify promotion efforts and enhance product awareness. Our main concern is to emphasize the benefits of our product and reduce customer resistance towards purchasing.

In order to assess if our objective has been achieved, we will carry out monthly surveys to determine the approximate number of consumers who are familiar with our product. Our main focus in enhancing consumer awareness of our product will be on highlighting its benefits, such as the healthy elements

and superior quality of our potato chips. We anticipate that consumers will view our all-natural, hand-cooked products as highly suitable for their lifestyles. As a result, as awareness of our product increases, we expect an increase in sales. Additionally, through raising awareness, we aim to address any concerns consumers may have about purchasing our product. Recently, there has been criticism directed towards potato chips due to their contribution to obesity and other health issues.

Cooking carbohydrates at high temperatures may produce acrylamide, a potential carcinogen. However, our product aims to tackle this issue by providing consumers with information. Our objective is to persuade customers to choose our product over competitors' options, ultimately leading to increased sales. To assess the effectiveness of our strategy, it is crucial that we consistently gather feedback from consumers. Therefore, we plan on conducting surveys throughout the year to evaluate changes in awareness and purchasing behavior. Additionally, we will inquire about consumers' perceptions of our product compared to offerings from other snack food manufacturers and its health benefits.

One of the challenges we face in achieving our marketing goals is choosing the right channel to educate customers about our product. Additionally, as more companies enter the market, we must compete against them to raise awareness for our products. Furthermore, established industry giants may find and duplicate certain aspects of our product, reducing our competitive advantage and making it harder to convince customers that our offerings are unique enough to be meaningful. To overcome these hurdles, we will strive to engage with consumers as close as possible to the point of purchase.

Our marketing communication strategy is vital for

achieving our marketing goals. We have mainly used secondary sources for Marketing Research, which has given us a basic understanding of the market, current trends, and our competitors. Statistics Canada has provided us with in-depth data on snack food sales in Canada and the percentage that can be attributed to potato chips. Additionally, Agriculture and Agri-Food Canada, along with the USDA's Foreign Agriculture Services, have assisted us in identifying the main locations where Canadian consumers buy snack foods.

The industry's size and overall performance have been extensively provided by both Industry Canada and Agriculture and Agri-Food Canada. Despite the potential high cost, conducting primary research would greatly benefit our company as it allows for an accurate assessment of the scale and distribution of our target market, monitoring its growth, and tracking changing beliefs and attitudes within this segment. Furthermore, gathering primary data would enable us to introduce new flavors that will satisfy our customers. To collect this vital information, we recommend utilizing online surveys with carefully selected internet samples and developing a questionnaire that covers all these aspects in order to minimize expenses.

We have opted for screened internet samples as they offer real-time reports and can be tailored to individual respondents. Moreover, internet sampling will enable us to reach our target market, which is highly active and busy, with hopes of receiving a significant number of responses. Additionally, primary data is crucial to evaluate the company’s ability to achieve the marketing objectives. Therefore, we suggest conducting monthly internet surveys with recruited internet samples to assess the effectiveness of our promotions. A sample survey that the company can utilize for this purpose is

included in the Appendix (see Appendix I). The internet sample method has been chosen due to its cost-effectiveness.

To grow the company, it is recommended that focus groups be used to develop and test new chip flavors. Additionally, focus groups can help determine effective ways to promote the product to our target market. Although more expensive, focus groups provide detailed consumer information that can enhance customer service. In terms of product strategy, potato chips are currently in the maturity stage of their life cycle. Our established competitors have already gained a share of the market, but emerging brands like Hardbite Chips are focusing on untapped niche markets. Our goal is to meet the demands of health-conscious consumers.

Our potato chips stand out from other brands because they possess several healthy qualities. To begin with, they do not contain any trans-fat or cholesterol, meaning consumers can enjoy them without worrying about their health being negatively affected. In addition to this, we utilize Himalayan salt instead of table salt in our potato chips. This alternative not only consists of the same 84 minerals as healthy blood plasma but also provides a lower sodium option that appeals to individuals who are conscious about their health, especially those with high blood pressure. Furthermore, our distinctive cooking process grants our potato chips an added advantage in terms of health compared to competing products.

In the production of our potato chips, we take precautions to avoid high temperatures that could lead to acrylamide formation, as it is considered a potential carcinogen. This safety measure is seen by customers as a significant advantage. Additionally, we enhance our potato chips

by offering unique flavors and providing information about their health benefits on the packaging. To further improve our product, we aim to expand the range of flavors available and introduce a consumer satisfaction guarantee. Our ultimate objective is to establish Hardbite Chips as a leading brand recognized for its exceptional quality among consumers. As for pricing strategy,

Our pricing strategy is designed to generate satisfactory profits and effectively compete with numerous rivals in the industry. To accomplish this, we aim to increase production levels while also positioning our product at a slightly higher price compared to competitors. This approach capitalizes on consumers' belief that price and quality are connected. However, it's crucial not to set the price too high as the potato chips market is sensitive to price changes. By achieving enough sales volume, we can cover fixed costs and achieve satisfactory profits despite competitors benefiting from economies of scale.

To effectively manage our distribution strategy, it is crucial for our company to carefully select distribution channels as our product is in the maturity stage of its lifecycle. Pricing plays a key role in attracting wholesalers and retailers. Our pricing strategy focuses on the market for healthy and high-quality potato chips, allowing us to set a slightly higher price than competitors. To incentivize customers to try our product, we will provide coupons that offer temporary discounts, which help stimulate demand. Once customers have tried and become familiar with our product, we can discontinue providing discounts. This approach allows us to effectively manage our distribution strategy.

The distribution of Hardbite Chips is currently done through various distributors, allowing the brand to expand its

reach from health stores to campuses and well-known retail stores such as London Drugs, Shoppers Drug Mart, Overwaitea, and IGA Marketplace. This distribution strategy has helped increase demand without the need for its own sales force. To further boost sales, it is important for us to directly communicate with retailers and convince them to carry our brand. Selling our product in convenience stores and vending machines would also help increase brand awareness. Despite a ban on junk food sales in schools, vending machines can be found in high traffic areas where our packaging's health benefits information can attract health-conscious consumers. Our IMC strategy aims to convince consumers that our product is a healthy snacking choice.

To position our company as caring and responsible, we aim to highlight our commitment to both the environment and our community. However, due to limited funds for promotion, we cannot allocate as much budget to advertising as desired. To effectively reach our target audience, we consider advertising in health-focused magazines an ideal choice. These magazines provide a cost-effective option with prolonged advertising exposure while also being widely shared among readers.

By utilizing public relations, we can effectively increase customer awareness of our product at a low cost. Sponsoring community activities, such as a community garden, and co-sponsoring events like eco-challenge (which receives national television coverage), will establish us as a company that values health-consciousness and the environment. These sponsorships have the potential to generate positive media coverage, reaching consumers who may not have been reached through our advertising efforts. Sales promotion offers various appealing options and is the most effective method for reaching our target market. Hence, it

will constitute the largest portion of our target segment.

In order to increase sales of our product, it is important to address the fact that consumers often overlook specific brand advertisements and do not spend much time deciding which brand of potato chips to buy. To tackle this issue, we can make use of a point of purchase display, which serves as the last promotional tool seen by consumers before they make their purchase. Additionally, providing samples is another effective strategy that can help boost sales. Allowing customers to try our product before buying it will help alleviate any hesitation towards its slightly higher price. Alongside our pricing strategy, we will also utilize coupons as an incentive for customers to purchase our product. By temporarily reducing the price through coupons, we expect more consumers will be willing to give our product a try.

Our distribution strategy involves using personal selling to persuade retailers to stock our product. This, along with other promotional methods, creates a successful combination of push and pull strategies that encourage more retailers to carry our product. As the company grows and allocates more funds for promotion, we will enhance advertising efforts through different media channels to reach our target market. Moreover, as consumer awareness of our brand increases and we expand our range of products, we intend to widen our target market and execute separate marketing campaigns aimed at specific ethnic groups. In conclusion,

Regardless of the intense competition in the snack food industry, we are certain that Hardbite Chips can yield profitable results and sustain its growth. Our approach entails increasing the availability of our product through

more retailers to enhance convenience for our target market. Additionally, we believe that creating awareness about our product will attract consumers who prioritize health. By implementing effective promotional strategies, we can educate consumers about the advantages and attributes of our brand while convincing them of its superior quality.

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