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Case
Can the Bunny Hop?
By Arun Pereira, Arun Patro, and Gary L. Lilien
“We fought off Time Warner and held on to the bunny. Now we are saying that
it’s too childish! Remember, it is mostly children who consume Nutrine
confectionery, not teenagers, not adults. And children love the bunny! My son
still remembers the advertisement we ran in the 1980s in Chandamama, with
bunnies holding Nutrine SuperStar Toffees. The bunny is our identity. We
cannot change what we are!”
—Ganapathy (VP-Operations).
“But things change. Even customers do. The question is, can the bunny hop
into new confectionary categories? Will customers accept the bunny in the
mints and gum categories?”
—Karthik (VP-Marketing).
Introduction
Nutrine was developed as the umbrella brand (sometimes called the “parent”
or “family” brand) for all confectionery products produced by the Nutrine
Confectionery Company (NCC). All the products it launched initially carried
only the name Nutrine on their wrappers. To attract its target group of children
between the ages of 6 and 13 years, Nutrine used a bunny brand character;
this bunny quickly became part of Nutrine’s identity. Many middle-aged Indian
consumers still reminisce about the Nutrine Bunny of their childhood—the
Bunny advertisements, the Bunny teeth they received when they purchased a
package of confectionaries, such as Kokanaka Cookies. But modern kids are
different: more individualistic, more exposed to global media, and highly brand
and image conscious. They understand brands through visual representations.
Does the bunny on the wrapper still have broad appeal? More important, is the
Copyright © 2011 by Indian School of Business. Distributed by DecisionPro with permission of the
Indian School of Business.
Nutrine brand still effective as an umbrella brand, which might be extended
into new confectionary categories such as mints and gum?
Background1
As competition intensified in the confectionery industry in the early part of the
twenty-first century, Nutrine found itself falling behind the competition. After
intensive negotiations with both Cadbury and Nestlé, Nutrine finally sold to
Godrej Beverages and Foods (GBFL) in June 2006. In April 2007, GBFL entered
into a joint venture with Hershey’s.
But the lack of focus in Nutrine’s brand investments between 2003 and 2006
continued to affect the business and its brands. The Nutrine portfolio 2 contains
products in various confectionery categories,3 but its major brands dominate in
three: hard-boiled candy, éclairs, and toffee. Two key brands accounted for a
whopping 70% of Nutrine’s revenues: Nutrine MahaLacto (hard-boiled candy)
and Nutrine Éclairs.
Unfortunately, both key brands were losing substantial market share.
MahaLacto continued to have a strong brand name, independent of its
association with Nutrine. Despite minimal branding efforts between 2003 and
2007, MahaLacto ranked eighth in a 2007 brand equity survey, conducted by
the Economic Times (behind the chocolate brands Dairy Milk, 5 Star, KitKat,
and Perk and heavily advertised brands such as Big Babol and Boomer).
The GBFL–Hershey marketing team had a clear task cut out for it: to define a
brand roadmap that would arrest declining revenues, increase the marketing
focus on key brands to enhance sales, and build top lines by launching
innovative brand extensions into new confectionery categories. A key question
considered was whether to continue with Nutrine as an umbrella brand if the
company chose to make forays into new categories, such as mints and gum
(which includes both bubble gum and chewing gum).
1
The details of this case are as of June 1, 2007.
2
Appendix 2 displays key brands owned by the Nutrine Confectionary Company.
3
Appendix 3 lists all confectionery categories and the key features of each category.
Anand explained that before they could begin customer research, the first step
was for them to define a Core Model for confectionaries in general. Doing so
meant achieving a consensus opinion about which Core, Supporter, and
Peripheral elements would be common across all confectionary categories.
Then, customer research could focus on brands such as Nutrine and
MahaLacto, as well as on categories such as mints and gum, to compare the
research outcomes with the Core Model for confectionaries, identify any
Absentee elements, and highlight Detractors, if any.
After two hours of spirited discussions, the marketing team arrived at a Core
Model for confectionaries (see Appendix 5). The Core elements included Taste,
Indulgence, Flavors, Colors, and Fun. As Supporter elements, the team listed
Crunchy, Soft/Chewy, Sweet, Sour, and others. Peripheral elements included
Friends, Outgoing, Sporty, and Stylish.
“This Core Model for confectionaries will be useful when we complete our focus
group discussions with customers, with regard to Nutrine, MahaLacto, and the
new categories,” explained Anand. “It will be the basis on which we identify
Absentee elements, as well as determine the degree of commonality in
perceptions across brands and categories—all very valuable in deciding if
4
Appendix 4 details the brand architectures of NCC’s key competitors.
Assignment
The marketing team at NCC is looking to build on the rich insights they gained
from the FGDs and then captured in the Core Models.
Using the information in the Core Models for mints and gum and with some
managerial judgment, the marketing team has narrowed down key attributes
perceived as relevant for these categories. They hope to use these attributes
5
Appendices 6 and 7 display the FGD plan used, the levels of interactions at various locations, and
the process followed to identify the FGD participants.
Note: This case was written by Professor Arun Pereira, Arun Patro, and
Professor Gary L. Lilien as a basis for class discussion. It is based on real
events; however, the names of individuals have been changed. The material
and events described in this case represent only a small part of a larger
research study conducted by the company. The company was not involved
with the materials or data associated with the Assignment section at the end
of this case.
Confectionery can be classified into nine categories: hard-boiled candies (HBCs), toffees,
éclairs, mints, gum, jelly cubes, fruit/mint rolls, digestive candies, and lollipops. Nutrine
currently does not have any products in the mints, gum, jelly cubes, or digestive candy
categories.
Market
Segment Growth Key Brands
Contribution