Recommendations and Rationale My recommendation for Sun Chips would be to pursue the option of fully launching the product line. If the survey shows that the product would be a flop Frito-Lay would be saving money by not putting it through a test market stage and the various other testing phases. Ultimately, they had to wait until the right time to release the product. Based on these responses, Frito-Lay, Inc. In this period, the market test information is more useful because the marketplaces are similar.
This provides for new difficulties that can be handled seamlessly if the products are kept in the test-market phase. Frito-Lay Company - Cracker Jack 1. I would first have the company keep the two flavor options of original and French onion. Paul, Minnesota, and metropolitan area. This issue focuses on improving the products through intensive research and development in order to increase the quality fit for consumer benefits. It may have been invented and introduced before its time.
Significant Factors One of the most prominent factors influencing Frito Lays push to figure out the perfect combination of a multivitamin chip was that no one had pursued this side of the chip industry yet. Frito Lay has already dominated the snack industry with its strong brand name, sales and distribution channels, and advertisement skills therefore the first option would require a lot of money and creative ideas to understand their consumers at such an intimate level. Diuretics decrease blood flow to the placenta by decreasing blood volume. Build the household repeat and depth of repeat business by introducing a flavor extension mild cheddar 6. The snack chip category is growing, mainly because of the increased per capita consumption, which rose from about 12 pounds in 1986 to nearly 14 pounds in 1990.
The test ran for ten months with excellent results. Here Frito Lay will need to use a portion of their allocated funds for advertising. What are the relevant Facts? They have thirty-nine manufacturing plants, over 1,600 distribution centers, and a 10,000 person route-sales team which sells to over 400,000 retail stores per week. In addition, alternatives should be related to the problem statements and issues described in the case study. Frito-Lay first toyed with multigrain snack chips in the 1970s, when research indicated a need for a snack in this category. In this period, the market test information is more useful because the marketplaces are similar.
The industry is obviously growing significantly. One-third of the cannibalized volume from Frito-Lay's products came from Doritos brand tortilla chips. Development for the product now under the Sun Chips brand picked up in 1988. The reasons that resource imitation is costly are historical conditions, casual ambiguity and social complexity. Reasonable Alternatives The first option Frito Lay can pursue is the full production and launch of Sun Chips. Increased customer feedback — larger sample, more variety of customers, more feedback 4.
Pushing out the Sun Chips line earlier than later will have the upper hand on competition because they will be the iris in market to produce a multivitamin, healthier alternative to the classic chip or pretzel. Consumption of chips in the United States has reached 3. While the first two flavors are being launched, Frito Lay should work on the perfection of the mild cheddar flavor along with the sizing options. Sunchips should be labeled as health product rather than as a chip and placed in health aisles and health stores. The snack chip category is growing, mainly because of the increased per capita consumption, which rose from about 12 pounds in 1986 to nearly 14 pounds in 1990. Secondly, after identifying problems in the company, identify the most concerned and important problem that needed to be focused.
Here they will need to start producing the two flavors of Sun Chips, Original and French Onion, in all three sized bags. With this recommendation there are some conditions. Borden Foods is in the process of divesting of snack and non-food products in order to focus efforts and resources in growing their pasta and grain based meal segments. With regard to national introduction, increased manufacturing capacities deal with distribution intensity, not geographical distribution. Continue to test the product and risk having a competitor launch a similar product nationally or regionally 3. The numbers and information gathered could be misleading for long term sustainability. When the company starts to produce Sun Chips at such a large volume, they will need to figure out how to handle and store the all of the products.
The market was slowly gaining health consciousness as baby-boomers matured and desired healthier alternatives to their snack foods. The market test result appeared consumer response was favorable which means it likely gain profit from the new brand. The snack chip category is highly competitive and the new-product failure rate is high. If the company holds some value then answer is yes. This strategy will focus on Product prices and product locations or places. The senior Frito-Lay executives need to decide it they would launch this new product to market officially after the test period.
I would only stick with these two instead of trying to add the mild cheddar as well because these two flavors are capable of being mass produced and they have a fair share of research done on these two. By launching the product earlier with only two flavors and three sizes Frito Lay is still getting their foot in the door and making a huge statement by becoming the first company to produce an everyday multigrain, healthier chip. The market was slowly gaining health consciousness as baby-boomers matured and desired healthier alternatives to their snack foods. Simply coping with the strategies from the test may lead to a terrible result. Consumers preferred the SunChip name,while the most popular flavors were Natural and French Onion.