Download Strategic Marketing: Goody`s Ice Cream

Strategic Marketing:
Goody’s Ice Cream
Tricia Coppola
David Wertheimer
Strategic Marketing & Implementation
April 17, 2004
Strategic Marketing: Goody’s Ice Cream
Positioning/Place
• Recognized that we must have our own plan/strategy – can not
follow others
• Made long-term decisions/plans early
• Scrutinized opportunity costs i.e. cost of advertising and sales
support versus market potential/growth
• Consistently pushed consumer perceptions of product to position
our brand appropriately – create demand
• Entered markets where our product was appropriate to demand
rather than push into the largest segments
• Negative – financial strains and market risks of product or market
diversification (pulled out of one market that we invested in for
one year)
Strategic Marketing: Goody’s Ice Cream
Price
• Used R&D investment to drive down internal costs in mature
markets with heavy competition
• Reduced retail prices in mature markets to gain a competitive
edge without reducing margin
• Maintained or raised prices in markets were we had superior
product, less competition and high purchase intention = better
margins
Strategic Marketing: Goody’s Ice Cream
Promotion
• Used consistent amounts of promotion to maintain leadership
position in country segments where we had no competition
• Heavy investment in new markets to support product launches &
create brand awareness; used both advertising and sales
support
• Through investment and strengthening of consumer experience
curves we maintained consumer purchase intentions
Strategic Marketing: Goody’s Ice Cream
Product
•
Placed a premium on having the right product portfolio for
each of our markets
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Continuous R&D improvements to address dynamic market
environments
Focus on market trends/understanding customer needs to
supply appropriate product benefits
Said “No” to markets that were too competitive or where our
product benefits were not an asset
Strategic Marketing: Goody’s Ice Cream
3C’s
•
Corporation
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•
maintained strong markets while trying to push into new ones
continual R&D to lower costs and revise formulas
Customer
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•
launched in segments where product would match demand
used revised formulas to maintain interest levels
Competition
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tried to predict spending levels and plans, and adjusted our
expenditures accordingly
avoided markets where multiple players were already battling
(tried once, got burned)
In competitive markets, unable to establish product differentiation;
battle fought on price and perception
Strategic Marketing: Goody’s Ice Cream
Market Position and Market Share
•
Held sole-provider status in two markets
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•
Increased margins and kept prices high to maximize profit
Continued R&D to maintain hold on each market
Had single competitor in three markets
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•
Matched price and spending to keep 50% market share, which
provided strong profits ($72-120MM Year 7) in each segment
Pushed R&D so price cuts would not hurt profit margin
Would have benefited from added expenditure to take market
share from competition
Value in pricing
–
In our first sole-provider segment, raised prices while increasing ad
expenditures and saw good returns
Strategic Marketing: Goody’s Ice Cream
BCG Map (I forget the real name)
Glace
(C4 S2)
Glace
(C1 S2)
Shardje
(C3 S2)
***
Glace
(C2 S1)
Glace
(C3 S1)
$$$
???
Shardje
(C1 S1)
Year 5
Strategic Marketing: Goody’s Ice Cream
How We Operated
•
Division of labor and strengths
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•
Comfortable push and pull
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•
Tricia: market assessment, sales and advertising allotment
David: perceptions, competitor tracking, R&D
Tricia: mass-market and expansion
David: core strengths and positioning
Plotting data proved key
Strategic Marketing: Goody’s Ice Cream
Charting: brand formulations
Strategic Marketing: Goody’s Ice Cream
Charting: perceptual maps
Strategic Marketing: Goody’s Ice Cream
Charting: purchase intentions
Strategic Marketing: Goody’s Ice Cream
Lessons Learned
•
Balance
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Value in both large and small markets
Maintain profitable products to help launch new ones
Focus
–
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Don’t try to do too much too fast
Continue marketing and developing products for core markets
Strategic Marketing: Goody’s Ice Cream
Lessons Learned
•
Competitiveness
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Great to have markets where no one else competes
Surprised that the other teams ceded two markets to us
Saw the impact of ceding markets first-hand: went into and then
withdrew from C1 S1 and our withdrawal gave Grateful Fed its
biggest gains
Diving into mature markets unwise unless substantial capital (and
patience) is available
The first-place team gets no concessions