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Submitted by:
Abhishek G Thrilok (61510649)
Nitish Barbaria (61510824)
Raghav Dasson (61510725)
Ramashis Biswas (61510121)
Contents
Five Cs Analysis for GCP..................................................................................4
1.
Company...................................................................................................... 4
2.
Competitors.................................................................................................. 4
3.
Customers.................................................................................................... 5
4.
Collaborators................................................................................................ 5
5.
Context......................................................................................................... 6
Advice to Sanchez:............................................................................................. 6
Should GCP promote brands:...........................................................................8
The Frozen Foods Division at GCP has two major brands: Dinardos and Natural
Meals.
Dinardos
o Dinardos is positioned as an inexpensive mass brand that delivers quality. The
assortment of flavors in Dinardos is in line with this positioning.
o Dinardos is preferred by consumers as they taste better than competing
alternatives due to GCPs use of quality ingredients and seasonings.
o Dinardos 16 and Dinardos 32 are the major package sizes of the Dinardos
Brand. Other smaller package sizes are available, but are primarily targeted at
serving a retailers entire consumer base.
o Dinardos 32 was initially positioned as a low-cost option to feed a family of
four. Dinardos 16 was launched in order to cater to the needs of smaller
2. Competitors
The closest competitor for GCP is Daft with a market share of around 25%.
Majority of Dafts volume is generated by the Manly Meals brand.
Draft is currently test marketing a brand called Healthy Options to target the health
conscious customer.
It is a possibility that Daft could increase the incidence and/ or depth of its own
In addition, some retailers have introduced fresh, convenient already prepared foods.
These are, however, twice as expensive as frozen dinners.
3. Customers
Consumers have increasingly less time available for preparing meals, and this has led
promotion.
The above behavior, however, requires customers to be open to switching brands,
households do not have a large enough freezer to make this a sustainable strategy.
Price conscious customers are not keen on buying private label goods as these are
4. Collaborators
GCP mainly sells its frozen products through supermarkets, in the frozen foods aisle.
Retailers need to carry an assortment that is able to cater to their entire customer base.
5. Context
The Frozen Meal and Entre category had grown steadily at 2.8% (CAGR) between
2003 and 2007. Since 2007, growth had been lower due to increased competition from
restaurants.
In the current scenario, GCP is falling behind its August target by 3.9% (volume) and
faces questions regarding the sustainability of its above average growth rate.
Advice to Sanchez:
The following images are the screenshots of the calculations based on her templates:
Table 1
Dinardos 32
Average Monthly Volume For:
Dinardos 16
10,460,942.50
6,210,220.40
6,816,235.00
3,088,564.63
7,174,738.60
3,798,942.40
3,286,203.90
2,411,278.00
6,901,028.19
5,787,067.20
2,431,790.89
2,001,360.74
3,757,213.25
4,307,862.57
712,024.06
(522,156.11)
The first part of the Sanchezs solution (Table 1) shows an increase in marketing margin for
D32 promotion, and a fall for D16 promotion.
But, a consideration of inter-brand cannibalization (Table 2) helps understand the real picture.
Heavy cannibalization of D16 is seen when D32 is being promoted. This results in a drop of
overall revenues and margins to a great extent.
$4.7M.
On the contrary, promotion of D16 results in total (D16 + D32) sales volume increase
of approx. 977,000 and revenue increase of $2.8M. However, it results in a marketing
margin drop of $2.5M.
Table 2
Dinardos 32
Dinardos 16
5,740,724.20
424,648.00
7,174,738.60
3,798,942.40
(1,434,014.40
(3,374,294.40)
)
(3,011,430.24) (8,098,306.56)
(1,061,170.66
(2,800,664.35)
)
(5,099.28)
74,210.57
(1,945,160.30
(5,371,852.77)
)
(1,197,278.37
)
2,775,636.96
(4,659,828.72
)
(2,467,316.41)
Thus, a promotion of either of Dinardos 32 or Dinardos 16 is a bad idea for Sanchez and,
hence, should not suggested to GCP.
On the contrary, a promotion of Natural Foods (Table 3) leads to increased revenues and
marketing margin. This may be a good option for Sanchez to recover some of the loss
numbers from previous Dinardos promotional activities.
Table 3
Impact of Natural Foods Promotion
Average Monthly Incremental Volume
Average % Store Promoting For Natural
Average Monthly Incremental Volume/ Promo
Point
Incremental Volume from 25% Promo Points
705,251.96
7.61
92,643.94
2,316,098.39
6,716,685.32
2,084,488.55
4,125,425.00
506,771.77
As seen in the graph above, all the peaks in D32 and D16 lines correspond to a promotion by
GCP. A peak in the total sales figure for one product is associated with a sharp fall
(cannibalization) of the other product. Also, note that the Natural Meals sales is relatively
growing at a constant pace and is not affected by activities related to the Dinardos brand.
Hence, neither D32 nor D16 must be promoted, as the resulting revenue increase does not
substantiate the expenses on marketing and promotions.
As mentioned earlier, the customer base for Natural Meals is insulated from any changes to
the Dinardos brand. We also know that this is a niche segment and GCP is concerned about
brand dilution and brand equity erosion. Hence, promotional activity for GCPs products may
not be a good option for the long run.
Further, GCPs major competitor Daft may increase the incidence and/or depth of its
promotional activities in case GCP fielded any promotional activities. Hence, GCP should
look at other avenues, such as ATL advertising, for marketing and promoting Dinardos and
Natural Meals and thereby driving growth over the long run.