Name: Gazal Gupta Enroll no: 11BSPHH010303 Seat no: 52

Cases Issue: 1. Division’s sales volume was 3.9% behind plan and gross revenue was under plan by 3.6%. 2. Consumers were buying less and they were buying in a different product mix than expected. Objectives:1. Formulating and implementing a sales promotion for 3 items Dinardo’s 32-ounce,Dinardo’s 16ounce or natural meals; including: cannibalization, brand equity erosion, forward-buying, passthrough, and consumer stockpiling. 2. Evaluate the historical performance of sales promotions and suggest measure for the above. 3. Calculating top-line revenue, marketing margin, and return on marketing investment (ROMI) for prior promotions. Constraints:1. FFD’s current marketing strategy is constrained by consumer buying habits, pressure by GCP (its parent company), as well as the negative aspects of implementing a price promotion. Consumers are buying less and they are buying in a different product mix than expected. 2. FFD is also being heavily pressured from GCP (and ultimately Wall Street analysts) to meet planned annual revenue goals. FFD was expected to drive approximately a third of GCP’s overall business volume. Poor results would certainly impact GCP’s financial stature and opinions with financial analysts. Why Frozen food? 1. Due to change in trend such as the emergence of dual career families, increase in commute times and less time available for meal preparation. 2. FDD has a 43% national market share. 3. Consumer’s typical product selection hierarchy: Type of meal(Italian, Mexican, meat & potatoes)  Brand (Dinardo’s, Natural, Manly meals etc.)  Variety (i.e. noodle, ravioli, etc.) Product Offering by GCP 1. Dinardo generated over $425 million in revenues annually, taste better than those made by daft and other producers. 2. Three sizes  32-ounce: Fairly inexpensive to feed a family of 4  16-ounce: For emerging busy professional couples without kids, easy to prepare, for 2 people.  6, 8-ounce: to server single consumer and for eat alone occasions. 3. Natural Meals accounted 25% of FDD revenue ($150 million).It had earned a reputation for producing great tasting; organic frozen foods that were low in fat and didn’t contain unnecessary additives or preservatives.

Promotional Planning Each division specified annual targets for key metrics. An annual production plan was developed and approved; the duration of promotions was usually one week. The timings was determined by a number of factors such as seasonality, purchase frequency and product capacity. There were three main effects of a promotion:  Increased overall consumption(market growth)  Purchase time acceleration(Stock piling)  Brand switching

Summary of Marketing Strategy’s Strengths and Weaknesses
Potential Resource Strengths and Competitive Capabilities       Short-term marketing strategy objectives are well defined. Strong brand image for the Dinardo’s brand. Better quality product than competitors. Efficiency gains for Natural Meals brand due to scale economies. Natural brands has untapped growth potential in a developing market. 43% of national market share (by revenues) for sub-category.

Potential Resource Weaknesses and Competitive Deficiencies     No clear long-term strategic direction for marketing. Weak brand image and reputation for the Natural Meals brand. Threat of cross-brand cannibalization Shifting of consumer habits.

Implications for Strategy Development
The following issues could cause complications for strategy development:  New entrants into the market.  Consumer habits could shift yet again.  Negative effects such as: cannibalization, brand equity erosion, forward buying, non-compliance with pass-through from retailers, stock piling and brand switching from customers, could occur from increased sales promotions.

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