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Terra chips
Summary
Introduction
I - S.W.O.T. analysis
II - Market trends
III Positioning strategy
IV Marketing Mix
V How to achieve
psychological pricing
competitive
advantage
by
using
VI Value-based pricing
VII Buyers perception of high quality purchase
VIII Innovative distribution channels to enhance the perceived
value
IX Would Terra Chips be successful in other countries
X What marketing steps would you recommend?
Conclusion
Bibliography
Introduction
TERRA CHIPS, a USA-based company, founded in 1990, offers a wide range
of vegetable and potato chips, which have created a new niche on the salty snack
market.
Terra has always had a tradition of creating masterful combinations of unique
vegetables with a variety of fabulous flavours.
So we are going to deal with this business case, in order to make you more
familiar with this company.
I)Swot analysis
First, to define the framework in which the company is evolving, a SWOT analysis
has to be carried out. Indeed, that will helps us find the internal variables of the
company (its strengths and weaknesses), that is to say those under the control of the
firm and the external variables (opportunities and threats) that the company has to
face.
S
Strengths
Company
Trailblazer: They were the first to introduce vegetable chips on the US market.
Position as the non-potato chips: They differentiate themselves from the
generic type of chips (potato chips).
Rewarded at the 1993 NAFSTs (National Association for the Specialty Food
Trade) trade show: This shows that the company is recognised by the
professionals.
Money-savings: The firm has not done any advertising; they have been a
positive buzz effect. This is what is known as Viral Marketing.
Hard-core loyal consumers.
Product
W
Weaknesses
Company
Product
Fad product: they should have product in the pipeline to sustain sales and
profit.
Exotic and uncommon taste in the USA: It may be more ordinary abroad, and
so, what is successful in the country of origin may be a failure in Asia for
example. Exports wont be easy.
O
Opportunities
Competition
_From other types of snacks: Potato chips, corn chips, tortilla chips, cheese puffs
and pretzels account for 97% of the salty snack food market. Terra vegetable
chips are in the other specialty product category.
_From other companies: National brand firms, regional brand firms and private
brands.
Pre-empted market: It is difficult for newcomers to enter the market.
Terra Chips may be too expensive to economical snackers: They account for
18% of the snackers in the American population.
II Market trends
A The snack food market
The snack food market has been estimated at around $ 79 billion in 1999.
Specialty
snacks
15%
Ice
cream
$ 11.5 bn
Chips
Salty snacks
25%
$ 19.4 bn
Bakery
snacks 24%
$ 19.2 bn
Cookies,
crackers
$ 28.7 bn
Gum, chocolate
Confectionery
36%
We can identify four major trends in the snack food market in 2000:
- the first one is a return to rich, robust flavours and full tastes
- the second trend is a demand for more out-of-the-bag, ready-to-eat,
meal replacement snacks.
- the third one is the diversification of distribution, as well as other
alternative distribution trends, such as the creation of dedicated
snacks fixtures within large supermarkets
- the last one is the fact that the firms are focussing on kids, teens and
young adults, across a wide variety of snack food sectors
Marketers also identify another trend, they qualify it as healthy oriented.
The healthy trend is certainly not the only trend in packaged snack foods, but it is by
far the most important and widespread one, driven in large part by a heavy national
focus on childrens health. Although sales of packaged snack foods in the U.S.
topped $61 billion in 2005, this is up only 6% over 2001 sales, since good returns
from "healthy" categories like yogurt and fresh fruit have been mostly offset by losses
in "less healthy" categories like candy and cookies.
Because kids snack even more than adults do, it is critical that snack makers
maintain a hold on this young demographic, and attracting consumers of all ages to
healthier snacks without severely cannibalizing sales of more traditional, not-sohealthy ones will be the fine line that marketers will have to walk in the coming years.
The U.S. snack food market is populated by a large number of players. We can
divide them into four categories:
- the Pillars
- the Builders
- the Followers
- the Differentiators
size
positioning
distribution
examples
Pillars
big,
international,
U.S. owned
Builders
big,
international,
U.S.
or
European
owned
mass
mass
retail,
mass retail,
segmented
foodservice
Frito Lay
Kellogg,
Nestl
Followers
Differentiators
mid-sized
to small to midbig,
U.S. sized, U.S. or
owned
international
owned
economy/mass niche
mass
segmented
Utz
Chupa Chups,
Pringles
There is a growing number of people who eat snacks to replace a traditional meal
(smaller portions of food are eaten in a day).
Concerning demographics, the increasing number of over 50 year - olds will entail
the development of fat reduced food. These people have a high purchasing power;
they are concerned about their health, their appearance.
The growing independence of women and their increasing buying power, together
with their recognition that snacking is prevalent in women has identified women as a
whole new target market for snack foods.
Consumers are more and more sensitive to new products and to high - quality
products.
The $ 21 billion U.S. salty snack market grew 23% from 1998 to 2003. Americans
consumers eat four or more snacks a day and consume more than 6.5 billion pounds
of snack food annually.
The salty snack food market has been growing at a rate of about 6 percent per year
on a dollar basis in recent years; however the pounds sold per year have plateaued.
It is expected that the growth registered by the salty snack market trough 2008 will be
fuelled primarily by the potato chips, tortilla chip and snack nuts segments. It is
forecast that all these segments will increase by more than 20% through 2008.
In the United States of America, snacks are largely consumed: indeed, 92% of the
households consume salty snacks. So there is a very high penetration rate.
We can deduce that only 8% do not consume salty snacks: we call them non-users.
But who are they? They can be people with health problem so who cannot eat
snacks because it is dangerous for their health. They can be sweet snacks
consumers or specialty snacks consumers. They also can be against snacks, or they
can go on a diet.
Concerning the products: what types of products are sold?
The salty snack food market includes potato chips, corn chips, tortilla chips,
cheese puffs and pretzels.
Potato chips represent the largest product class and account for 46% on a pound
basis. Corn chips account for 11%, tortilla chips for 18%, cheese puffs for 10%, and
pretzels for 12% of the salty snack food market.
A lot of new products are launched every year on the snack food market (about 150),
but most of them are failures.
These products are more and more convenient (ready-to-eat meals); they are also
portable and cheap.
In terms of health, interests in salty snack products that are organic or all natural, low
calorie, low fat or offer health benefits are in greater demand by the
consumers. In fact, 34% of the salty snack products introduced in 2003 featured
some types of healthy positioning.
Examples of firms
Frito Lay, Bordens , Procter and
Gamble (Pringles), Nabisco
Snyder, Bachman, Laura SCUDDER,
Sunshine and Weaver
Regional or local manufacturers
Frito Lays market share accounts for 50%, which represents $3.5 billion in sales
each year.
Concerning the snackers: who are they?
We can identify 6 categories of snackers:
- the weight watchers (14% of the American population)
- the nutritional snackers (22%........................................)
- the indiscriminate snackers (15%..................................)
- the economical snackers (18%......................................)
- the party snackers (15%................................................)
- the guilty snackers (9%.................................................)
Each type of snackers has a specific behaviour in terms of lifestyle and personal
characteristics, buyer decision process, degree of price sensitiveness, benefit sought
Positioning by users
(Identify a class of users)
Terra Chips, with its positioning strategy by user categories, must apply it with
the class of snackers, who must be frequent consumers, brand-loyal as they
consume regularly. There exists different kind of snackers. In fact, it depends on your
behaviour. Terra Chips wants to attract all the categories of snackers, as the
company provides products for the whole family of consumers.
The nutritional snackers, as health conscious people and knowledgeable
consumers, may consume products which do not put on weight. But it may be a
category difficult to attract, as the nutritional snackers consider since the beginning,
snacks and so chips, as a second-best product and not as a meal replacement.
However, the company has positioned itself as the non-potato chips company. They
are producing indeed, vegetable chips that contain low rates of fat and sodium.
The economical snacker who is someone who may have to snack everyday out of
home, and may have not lots sums of money, could be also a category difficult to
seduce as the price of Terra Chips is relatively high because of the ratio quality/price.
They are not brand loyal people, so it could be difficult for the company to attract
them. However, it can be interesting for the company to seduce that category by
having them to consume its chips from time to time but not regularly.
The party snackers are one of the categories Terra Chips could capitalize on. They
express low price sensitiveness, and so they dont take into account the high price of
the products they will choose, in the case they are hosts and not guests. In addition
to realize a better party, the host will choose innovative products, as for example the
exotic chips of the company.
The guilty snackers, are a category of consumers we have to pay attention to. They
enjoy snacks but regret immediately after, so it could be a good point for the
company, but in that case, the firm will make profits with the misfortune of people.
Either they are obsessive people, which have problem of weight, or they are
compulsive consumers, advantageous for the profits of the company.
The weight watchers are people who express a high degree of weight
sensitiveness. It could be a category of users the company could not capitalize on.
However with light and non-fat products, those people could be satisfied.
The Indiscriminate snackers are a category of snackers who choose their product
according to their mood. They dont enjoy any product in particular, either they are
salty snack or sugar snack. Moreover, they are not brand loyal, so it could be difficult
for the firm to capitalize on that category of snackers. It can be interesting only for the
firm to have them to consume chips from time to time, and so any strategy worth to
be carried out.
Positioning away from a competitor
(Positioned away from a competitor)
By creating a new product category, with vegetable chips, Terra Chips
differentiates its products totally from the products of its competitors, who produce in
the salty snack market copy-cat goods. Moreover, Terra Chips positions itself by its
brand image, well appreciated for example for the high quality of its products as can
prove us the ratio quality/price.
As a result, Terra Chips would go away from the trend of salty snack products
which would be in period of maturity (according to the diagram The Product Life
Cycle). It would not be interesting, indeed, for Terra Chips to enter a market with
already well established competitors. This may be the reason why Terra Chips
created its proper differentiate category of vegetable chips, segment to be pioneered.
Positioning by product classes
(Compared to different classes of products)
Terra Chips positions itself by its production of chips, especially vegetable chips,
which is a certain product class. This could be compared to any other class of food
products, either we talk of the salty snack food market, or the whole food market.
Terra Chips is unique, but we have to pay attention to the copy-cat chips, which may
create problem to the us-based firm.
The Product
The Price
The Place
The Promotion
1. The Product
Concerning the product strategy, Terra Chips positions itself as a non-potato
chips producer. Its products are said to be pretty and multicoloured, with a wide
range of tastes, flavours, textures and colours.
Concerning Terra Chips products, it can be said that that the firm has set up a
strategy of differentiation. In reality, all the firms in competition in the chip market
adopt strategies with products characterized by the same ingredients (in the chip
market, all the firm produce chips based on potatoes). However Terra Chips positions
itself differently with its wide range of products based on different ingredients and
tastes: That is to say that Terra Chips adopts a differentiated Marketing Mix, its
products integrated secondary functions along with the main one the potato
ingredient.
addicted, who become sometimes heavy-users, even hard-core loyal consumers who
dont want to taste any other products.
We have to take into account the three level of the product, that is to say
-The Core Product, i.e. the ingredients, the texture
-The Actual Product, including the Core Product, i.e. chips with the
packaging.
-The Augmented Product, including the Core and the Actual Products,
i.e. the promises of the products.
In Terra Chips case, the Core Product is all the time different with at least a
potato base, as the firm produces different kind of chips based on multiple
vegetables, exotic ingredient, even less fat chips.
The Actual product is also different according to the chips concerned. The
packaging is the same that is to say black and silver, but the contents depend on the
chips packed.
The Augmented product, which corresponds to the promises the chips would
bring to the consumers in that case, depends on the attempts the consumers would
have when buying a package of chips. In some case they would be convinced and
may be become brand loyal, even they may switch from another brand.
Nevertheless, they may be deceived and dont buy again the chips, even they may
have a bad buzz effect.
1. The Price
We have to take into account the price into the marketing mix strategy of Terra
Chips. This variable corresponds indeed to the ratio quality/price.
Famous for their high quality products, Terra Chips has to adopt a high priced
strategy in order to remain coherent compared to the valued range. In that case the
price of its products is not the consequence of the cost engaged by the firm in the
production, but on the contrary, the price corresponds to the high quality of the
products.
Consumers are, in that case little, little price-sensitive because they deem that
the price is worth the quality. The company should nevertheless, pay attention in not
increase or decrease too much the price, above all in a non-justified way.
As the firm is a pioneer into the differentiated market chips, providing nonusual chips, its prices are not fixed by the competition but by Terra Chips itself.
Becoming an element of reference mark for the new copy-cat products, the price is
high evaluated because of the strategy of differentiation of Terra Chips.
2. The Place
It corresponds to the means and operations which allow setting up goods and
services of a firm for users and final consumers
The objectives of the distribution of Terra Chips is to ensure itself a quantitative
cover of the market as well as a qualitative aspect, that is to say to have a well
agreement between the retailing channels and the brand image of the products.
Moreover, Terra Chips must ensure a good competence and dynamism of its retailing
agents, as well as the quality of the presentation of the products in outlets.
Terra Chips provides its high quality products in specialist retail outlets, which
once more, confirms the high quality of the products to be sold in such stores. We
could find Terra Chips products also in supermarkets, or in the Internet by ordering
them from the Terra Chips site. By developing their retail outlets in supermarkets, the
firm wants to gain market share, and to reach more and more consumers.
3. The Promotion
Concerning the promotion set up by Terra Chips, it could be said that the firm
does not use advertising campaigns.
On the contrary its products have benefited from the buzz effect, that is to say
a benefiting word of mouth from the peer group. We could talk of a viral marketing,
i.e. consumers became the main actors of the firm notoriety. In that case, advertising
costs are reduced and it allows the firm to touch more and more people. Consumers
prefer to refer themselves to their influence network. Some people discover Terra
Chips products by chance, for example they knew them from their colleagues who
consume them at work, or from their professor, friends, during a road tripping,
Some individuals are even brand switching, in the way that they change their minds
concerning others products.
By changing the lifestyles of the individuals, those ones dont want to taste
anything else and as a consequence, we could talk of a Terra Chips community.
People, indeed, meet themselves in a Terra Chips group, they enjoy a high degree of
satisfaction.
What is interesting today, is that new strategies appears, like contrary to the
4Ps: the 4Cs. The 4Cs refers to :
-Customer (What is the added value for the consumer?)
-Cost (What is the cost price?)
-Convenience (What is the better access for the consumer?)
-Communication (What is the better communication?).
Most of the competitors of Terra Chips like Lays, do not apply psychological
pricing. For example chips flavour barbecue from Lays are sold 1.35 $.
Subconsciously, the consumer will think that the chips cost more than 1 $ whereas
for chips from Terra Chips sold 1.99 $ he will think than they cost less than 2 $ but he
wont realize that in fact they are more expensive than those of Lays.
To conclude it is in the interest of Terra Chips to continue having a
psychological pricing in order to differentiate from competitors. But it will have to be
cautious because some consumers, who know very well this approach of
psychological pricing, may become irritated.
Objective
Justification for
Terra Chips
Profit
Market shares
Product-line
Brand Image
Ingredients:
Quality:
Some kinds of snackers are ready to pay more to get good quality products.
Lets take the example of weight-watchers or nutritional snackers: They are not pricesensitive, their only concern is to get products that wont make them gain weight or
that are good for their health. Terra Chips correspond to their needs because they are
lower in sodium and fat, and that enable the firm to price its chips according to this
value.
Distribution:
Packaging:
As well as the distribution, the packaging has helped giving Terra Chips a highquality image: It is a sophisticated silver-and-black package with a colourful picture of
the chips on the front. When seeing this package, customers understand that those
chips are not like the others: They look upscale and more sophisticated. This can
justify the higher price to them.
Terra chips operate on a niche (It belongs to the 3% of other specialty product
on the salty snack market). As it is rare and unusual, it can be priced higher than
more generic types of product because of the law of supply and demand.
Image of exclusivity:
What are the distribution channels Terra Chips should find to enhance the perceived
value?
When we talk of distribution channels, the first words that came are shops and
stores. But the distribution of a product can be done in many other ways.
Another way of distribution could be a partnership. That is to say that Terra
Chips should find some posh restaurants or bars for the partnership and for example
the restaurant or bar would suggest in its menus as accompaniment of a dish, or
even for the aperitif the chips. Then at the time of paying the bill, the customer will
find behind the counter some shelves with products of Terra Chips and could buy
them.
This partnership, if it is done with establishments very smart, could really
enhance the value of Terra Chips.
In order to be known of the professionals of the catering, the company Terra
Chips should attend exhibitions. Exhibitions enable to meet directly retailers,
consumers and even competitors.
Another channel of distribution would be the cinemas but above all famous
cinemas in big cities. Indeed, products sold in cinemas are usually a little bit
expensive and they are mainly high-class product and Terra Chips should be present
in this way of distribution. At the same time it could target the young.
However, there still exist a way of distribution that Terra Chips did not use: to
have its proper shops. For instance, the brand Nespresso (which manufactures
espresso makers) have its proper shops for selling its coffee because it is said that it
sells experience. Terra Chips should open some shops in big cities (e.g.: New-York,
Seattle, Chicago) and in smart districts. In its shops Terra Chips could sell all its
products and these shops would be a way for testing the new chips, flavour, colour
that it would launch.
Terra Chips should be present in luxury cruise ship, it would be a good thing
for enhancing their perceived value. It would be present also in fashionable holiday
resorts.
French who have loved their sweet snacks for years are now developing a
strong taste for salty snacks.
Together sweet and salty snacks in France represent a $ 4 billion market. The salty
snacks market is growing at a rate of 7% per year, and the entire snack food market
in France is expected to double within five to six years, reaching $ 8 billion.
80 % of French consumers consider snacks as a supplement to traditional
meals or to replace meals. Snacking becomes more and more popular in France.
So TERRA CHIPS could find a lot of outlets in the French market, it is a
growing market with a great potential.
- In the United - Kingdom
It is estimated that the U.K. snack market was worth 2.6 billion in 2004.
The salty sector is predicated to increase by 6.8% and the sweet snack sector by
3.4% between 2002 and 2006.
In 2003, potato crisps accounted for a further 43% of the U.K. snack food market.
Maybe it will be difficult for TERRA CHIPS to enter the U.K. market because
as we saw before this market became the second largest salted snack food market in
the world. It could have reached maturity.
B In Asia
- In Thailand
Overview of the market
Snack foods are popular in Thailand.
The market has an enormous potential for growth: consumption of all snack food
accounts for only 1kg/ per person / per year.
The snack food sector is dominated by local manufacturers who also export a
significant part of their production.
Snacks are also imported, but their contribution remains only a small proportion of
the overall market.
Snack sales have benefited from improvement in the distribution system which has
opened the rural markets.
This is a price sensitive market with a consumer base of children and teenagers.
Some imported snacks are able to compete with locally made products these are in
the high end segment, for example Pringles (Procter & Gamble, in the U.S.A.)
Salted snacks
Potato chips account for 30% of the salty snack food market.
The total snack market represented Bt 15 billion in 1998.
The total sales value of salty snack products in 1998 was estimated at about Bt 8.5
billion.
Trends
Frito Lay has injected about Bt 170 million this year to stimulate the domestic
snack consumption.
The domestic consumption of potato chips was flat in 1998 because potato output
was limited in the planting areas.
There is a huge potential for the extruded snack segment, which is now underdeveloped in terms of product innovation and development of modern distribution
channels.
-In China
Shanghais retail markets offer a remarkable variety of snack food products. U.S.
exporters may be challenged by the complexity of the market, but opportunities
prevail for producers who learn about and take advantage of established local tastes
and distribution channels.
Tradition and habits
China is experiencing the "Little Emperor" phenomenon in which one child
receives the exclusive care of two working parents. These children spend, on
average, more than $1 every week on snack foods.
The Shanghainese spend 9 percent of their total grocery bill on snacks. In
supermarkets, snack food spending increases considerably as most meats,
vegetables and fruits are still purchased in traditional outdoor markets called "wet"
markets.
Traditional Chinese snack foods were originally classified as either "wine
accompaniments" or "food accompaniments" and included fried beans, nuts and tofu.
The Chinese normally adhere to strict mealtimes, rarely skipping a meal.
Snack foods are usually eaten on a whim or to satisfy an impulse.
The brands
Popular brands include Hersheys Kisses, Pringles potato chips, Keebler
crackers, Wrigleys Doublemint gum, Britains Cadbury, Frances Prince and Japans
Oishi.
Domestic Products
A few brands have established quality images, but most are generally less
attractively packaged and less aggressively marketed due to budgetary constraints
and limited experience.
Snack foods from Taiwan and Japan are more competitive. Brands such as
Mamee, Wangwang, Khongyuen and Oishi occupy significant shares of the chips and
cracker segments.
New products
The Shanghai market is saturated with diverse products, and new product
entry can be expensive. It is very important that marketers understand that
Shanghainese usually try snack foods based on a whim.
U.S. products can readily sell here. Pringles and Hersheys have used
marketing and promotional techniques to achieve the sales they have today. So
TERRA CHIPS can also try to enter this market but with marketing and promotional
strategy adapted to Chinese habits.
-
In Japan
Health concerns are VERY important in Japan. They are very informed about
the glycemic index of food, which is a measure of how quickly food converts to sugar
in our bodies. Theyre well acquainted with terms such as anti-oxidants, polyphenols,
and GMO issues.
TERRA CHIPS which offers healthy products with high-quality ingredients can
take advantage of this Japanese trend. Maybe TERRA CHIPS will have to adapt their
products to this new market because the tastes and the habits are different, but it is
true for every country.
C In North America
- In Canada
Canada is the best market for U.S. salty snacks. At $ 38 million in 1991, this
market has increased by 153% since 1986 and accounts for nearly 30% of the U.S.
salty snacks exports. The countrys proximity to the United States of America has
helped to make it a strong market.
In 2001, Canadian per capita spending on snack food products was about
$24.
Annual per capita consumption of snack foods is estimated at 6.1 kg.
An aging population combined with consumers who are more concerned with
health have provided new opportunities for some snack food products.
Children are an important market for this industry and influence household
snack food purchases. Many companies target their products to the 12-24 age group
to capture the interest of this market segment who demand snack foods for taste and
variety.
Niche products that offer novelty flavours, shapes, or unique ingredients have
also been introduced. Unique flavours, products made from hemp seeds and root
vegetables such as parsnips, beets, sweet potatoes and carrots, as well as organic
snack food products are recent offerings in the market.
D In South America
The food industry continues to quietly grow and prosper, year after year. The
snack food market segment, in particular, has enjoyed a spectacular growth over the
past five years. Global players such as Nabisco, Frito Lay and PepsiCo all say that
Latin America is the fastest growing region in their global empires.
-
In Mexico
Fist of all, lets have a look on the Product and the Price
Since the product has reached maturity, above all we have to work on the
product line extension.
We have to cope with the consumer fatigue, which is the worst enemy of the
product. To win this fight, there is no secret, the response is: innovation. We must
create and develop new products on existing markets (in the USA and Switzerland).
For instance, we could create other products based on vegetables, to keep
the Terra Chips values, and what have made its success. We can also merely
develop the chips range creating new tastes, with new colours, but we do be cautious
of cannibalisation. So, once again, we must innovate.
But when you deal with innovation it includes, new prices and more, I would
say higher prices. This could be a way to recover its initial brand image and arouse
the consumers interest.
It could be interesting to launch a special range of products with original
packaging, for special occasions. I mean, for the Christmas and New Year period,
and why not for Halloween (mainly celebrated in the USA but which has already
reached Europe).
It is totally out of order that Terra Chips becomes a common product
It would judicious to modify the packaging. But just a little bit, to face the
consumers fatigue, lure other customers or former ones, not too much because the
danger could be to puzzle the consumer, its habits and marks cannot totally be
changed.
So far, Terra Chips has not done any advertising campaign so we should cling
to it and keep on making below-the-line advertising. In this field, two words to begin
with: Sponsoring and Corporate.
Terra Chips is already sponsoring a hockey team in Switzerland, and it should
have this done once again. Nonetheless, it would be better to target other sports like
golf, cricket, tennis, riding, and so on. I mean less popular disciplines, which could
help it to recover its initial value of top of the range product. In another way, Terra
Chips could be patron of an exhibition painting, or could build a foundation.
Moreover, Terra Chips could find an interest in being present at local or
international trade fairs or distributor display rooms. In order to find more distributors
and outlets, which would be more suitable. This would also enable it to ensure its
brand image, find other customers data bases, introduce its innovations, and so on.
Then, Terra Chips could also make hard selling, on the products which already
exist, by using coupons or thanks to cross samples. I mean it could associate with
another high end brand which would offer Terra Chips samples (or grant discounts on
Terra Chips), for the purchase of one of their own products. Moreover, sometimes it
would launch charitable promotions by giving a defined percentage of what they earn
on the product sales, to a charitable association, or a foundation.
Terra Chips could also organise a sort of tasting in specialised shops and
delicatessens and other events, in order to create a sort of Terra Chips private club
in which regular customers would be the members, and would benefit from gifts,
discounts, samples and so on.
The promotion can also come with advertising spots. Indeed some prestigious
bars or tea rooms possess high tech TVs on which short advertising spots pass
before your eyes, and it would be strategic because in this place you find a special
clientele, the one Terra Chips wants to reach in order to help recovery.
Besides, the group could also pay for an apparition of their products in a
movie or in a series. I particularly think about Desperate Housewives, in which I
perfectly imagine Bree Van Der Kamp, who is the perfect host always taking care of
her guests, and who drastically applies well fitting rules, offering to her guests, before
the dinner, an assortment of Terra Chips, dont you?
Last but not least, the firm has to focus on cross fertilization and repeat
experiences like the one with Jet Blue, which proved prosperous in the past. Terra
Chips could be tasted during a luxury cruise ship, for instance, and it should not
hesitate to flood meetings, conferences, society gatherings and evenings,
fashionable places and so on, in partnerships with famous companies and
organizations.
Terra Chips products could enjoy a revival, and recover its notoriety, by being
available in the right outlets, and by being tasted in the right place.
On the one hand, Internet is good for its products because it enables it to
reach even more customers all over the world, since Terra Chips is not sold
everywhere. But on the other hand, it kills the product and makes it losing its value
and prestige because now, everybody can buy a Terra Chips box on the Net. Thus,
we cannot take away Terra Chips products which are sold on the Internet at the
present time. Nevertheless, the future innovations will have to be available in
specialised shops, delicatessens, and some retail shops to avoid the trivialization of
its products. In those outlets, tasting will take place to submit these innovations to the
connoisseurs reactions.
Conclusion
Terra Chips is a company that is successful on the American salty snack food
market, but which has to go on innovating to face consumer fatigue and keep on
being a market niches. It has also many opportunities to catch so that it can sustain
sales and profit.
Finding a new niche could be one of the possible solutions to Terra Chips
future. For instance, it could introduce vegetable chips made with fair trade products,
in order to improve once again its brand image.
Bibliography
TerraChips.com
Snackfood Company profiles 1998 (Adobe Acrobat)
Wikipdia.com
Basic Marketing
Company Background
Mr Franois first and second year marketing lessons
Mr Duvals second and third year marketing lessons
Findarticle.com