Thoroughly describe the main issue or issues that are described in the case. What are you trying to solve or what decisions need to be made?
1 "Pizza is an unhealthy product," this strong image is hard to change the customer's mind.
Emphasize consumer they are using an organic product, display as frozen healthy category.
The case discusses the company's intentions to get into another market as well as the production of other products. The current market for Annie's is mothers who have young children. However, when the kids grow older, the mothers are likely to stop being core customers. The company has to expand the market base. The company also wants to start production of organic frozen pizza. However, due to the belief among consumers, it may be challenging to introduce this properly into the market without skepticism.
List the relevant data for the situation:
Include both qualitative and quantitative information from the case that can be used to address the problems or issues described above. (This is where you list the most relevant information – think of this as collecting the “puzzle pieces”).
Currently, Annie’s net sales stand at $141.3 million. The company has been improving in matters of sales and revenues in the last few years. Essentially, the company is unique as it deals in products that are not used by most people. Apart from that, Annie’s operates in its terms due to the nature of the products and market segment. However, the fear is that the company may encounter issues when it expands its market base and diversifies its products, given the fact that it plays using own rules.
Evaluate Alternative Actions:
Describe the various options for each of the below areas and specify pros/cons of each option.
Target Market: the target market should be anyone that enjoys healthy lifestyles. More specifically, parents who have growing kids are best suited to be an ideal target market.
Product: The Company can diversify its products and start producing more frozen foods as well as canned foods. The advantage of this move is that the market size would increase. However, some of the sensitive customers may not accept these products.
Price: Since the products are different, the pricing would be dissimilar from other mainstream products. The advantage of this is that it would create more appeal among customers in the high-end market. However, some customers would prefer the cheaper, inorganic options.
Place/Distribution: Distribution at points of sale would be sufficient. Its advantage is that the company gets to reach the consumers directly. However, this move may only be short-lived.
Promotional Support: In essence, to promote the products, the company could utilize marketing agents at points of sale. It is an effective strategy as the products would get to the targeted consumers. However, there may be a decrease in sales when the campaign ends.
Describe your preferred action plan:
Based on your analysis of the different options, describe what you would do for each area and why you believe that is the best path forward:
What target market should Annie’s focus on going forward?
In essence, Annie’s needs to start focusing on targeting senior consumers. In essence, the current market consists of mothers who have young kids. The company should start targeting older people who love eating healthy foods. As a matter of fact, many people love eating healthy foods and the company needs to identify this group and target it with its products.
What is the best new products strategy for Annie’s?
For a long time, Annie’s has been concentrating on meals, snacks, and dressings. However, the company needs to increase its range of products. For instance, the frozen foods can fetch a sizeable market share for Annie’s. The company needs to introduce the new products in limited versions first and observe the reaction of the customers, before increasing the production.
How should the company move forward on price?
Primarily, moving forward, the firm needs to make the products available to all the groups of consumers. Essentially, the move would expand the customer base, which would consequently increase the company’s revenues
How should the company move forward on place/distribution?
The products of Annie’s are household products. The company should, therefore, choose strategic places for distribution. For instance, it may partner with stores in residential areas and stock its products in such stores.
How should the company move forward on promotion?
In essence, Annie's has never done any advertising on the media. It means that the development methods that it has been using have been useful. Therefore, the company needs to continue carrying out product promotion at points of sale and the local stores. The move is strategic as it targets specific consumers as compared to the mass media advertising which targets general audiences.
