3. Company
• Founded in 1989
• Manufacturers and marketers of
refrigerated cup yogurt
• Differentiators
–Nature Ingredients & longer
shell life
–Reputation for high quality &
great taste
4. Continuation
• Key success factors
–Strong brand
–Effective, low cost “guerrilla marketing”
–National distribution in natural
food channels
–Strong relationship with
distributors
5. Natural/Organic Market Trends
• Organic foods market predicted to grow
from $6.5 billion to $13.3 over 4 years.
• Generally organic products customers
tend to be more educated, earn higher
incomes, be older and live in the
northeast and west.
• 67% of households consider
price as a barrier to
purchase of organic
products.
6. Continuation
• 44% of consumers would like a wider
selection of organic products in
supermarkets.
• Supermarkets are moving toward
attracting new customers by
offering more organic products.
7. Yogurt Market Trends
• Concentrated – 4 competitors
control over 50% share.
• Supermarkets = 97% of total
sales (3% annual growth).
• Natural food stores = 3% total
sales (20% annual growth)
• Factors in purchasing decisions:
-Package
type/Size, flavor, price,
freshness, ingredients, organic.
8. Natureview
• Challenge : identify path to grow
revenues by over 50% within 23
months.
• Goal : Attain highest possible
valuation in order to secure new
investors or position itself for
acquisition.
9. Option 1
Expand 6 SKU’s of the 8-oz product line into one or two
selected supermarket channel region.
Pros:
8-oz cups represent largest dollar
and unit share of market
Supermarkets fear losing market
share to natural food competitors
Other natural food brands have
successfully expanded to
supermarkets
Cons:
Highest level of competitive trade
promotion and marketing spend
Possible channel conflict between
supermarkets and natural food stores
Promotion and lower price at
supermarkets may hurt the brand
10. Option 2
Expand 4 SKU’s of the 32-oz product line nationally.
Pros:
32-oz cups generate an above-
average gross profit margin (43.6%
vs 36% for 8-oz line)
Fewer competitive offerings in this
size
Competitive advantage due to long
shelf life of product
Lower promotional expenses than
option 1
Cons:
Higher slotting fees due to national
distribution
National distribution will be challenging
within 12 month
No guarantee that customer awareness
of the brand would grow
Promotion and lower price at
supermarkets may hurt the brand
11. Option 3
Expand 2 SKU’s of a children’s multi-pack into naturals
food channel
Pros:
Natureview already has strong
relationships with leading natural
foods channel retailers
More time to prepare the company
for moving into supermarkets
Financially-attractive
High margins- 37.6%
Cons:
Fast growth of natural foods channel
will lead to demands equal to those of
supermarkets
Miss opportunity to enter supermarkets
before competitors
12. Financials of Option 1
Sale price $0.78
Retail margin $0.21
Price to retail $0.57
Distributor margin $0.09
Price to distributor $0.48
Mfc cost $0.31
Gross profit NV $0.17
16. Financials of Option 3
Sale price $3.35
Retail margin $1.17
Price to retail $2.18
Distributor margin $0.20
Price to distributor $1.98
Mfc cost $1.15
Gross profit NV $0.69
17. Recommendations
Option 1
• Financials
• Only a regional distribution instead of national
which should make it easier to implement
• Competitors are going to move into
the supermarket space and we
may miss a huge opportunity
by not taking the risk
• Higher slotting fees,
but more visibility
of the product
18. Recommended Adjustments
What action plan should the company pursue?
• Marketing mix: 8-oz, $0.78, located in-store
with other major yogurt manufactures, in-
store promotions
• Sales: utilize more sophisticated technology
to monitor sales trends
• Brand: will remain premium through
joint promotions with other
premium products such as
granola or organic fresh fruit
19. Continuation
• Channel partner Arrangements:
Lower MSRP for natural food retailers to better
compete with supermarkets
Work with retailer, distributer, and wholesaler to
reduce costs and maintain margins
Ex: case-breaking, shelf stocking, paperwork