RESEARCH FOR MARKETING DECISIONS

Case Submission - 02 General Mills - Yoplait Custard Style Yogurt (A)

Submitted to Prof. Patrali Chakrabarty Indian Institute of Management Bangalore

Submitted by:
Arunangshu Giri Bhavya Sindhu Gurkirat Singh Mukesh Kumar Saba Rahman Snehil Raj (1011013) (1011020) (1011028) (1011036) (1011050) (1011061)

General Mills - Yoplait Custard Style Yogurt (A)

This case deals with the problems faced by General Mills during product line extension. They were deciding on the strategy to be adopted for introducing a new product Custard style Yogurt in their product line which already had - Yoplait original Style yogurt.
Industry Context:

The Yogurt Industry leaders were facing lower growth prospects as the mature yogurt market was anticipating very little(2%) or no growth in the near future as found in the national survey. There was a widespread shift in the consumer perception of yogurt as a meal (regular users) to an indulgence snack item (new users). Consumption volumes accounted for by new users increased but was not making up for the lost volume from regular/traditional users. The yogurt market was highly fragmented and regional. There was presence of various local private players and General mills had higher market share in select regions only.

Management Decision Problem:

Formulation of a new suitable yogurt from amongst the various available combinations to capture the untapped regions where they had minor presence. The Company had to decide on the correct positioning of the product: Target consumers and snack/dessert image projection Decide on the most appropriate marketing mix: formulations, packaging, size and pricing. The company had identified seven potential mixes.

Marketing Research Problem:

The management needed to decide on the most reliable market research test that estimates the new products sales and operating profit and measure the extent of the cannibalization of the regular Yoplait.

Recommendations:

We recommend the BASES test because of the following reasons: o It had proved successful and accurate in predicting the sales numbers of their previous products. o The test was cost effective and delivered results in short span. o It could also give an estimate of the marketing expenditure because of its dynamic structure. Due to lack of any marketplace exposure in the BASES test we suggest a mini market test as a follow up measure to complement the findings of the BASES test. The test has the advantage of utilizing less investments and providing results in a short time. It also estimates the extent of the cannibalization. We recommend the company to position the product as a snack option since the customer perception is invariably shifting towards the indulgence snack item. Also the concept fulfillment test gave favorable results for the following combination: fat based/Vercon cup/ 6oz. We believe the company

should launch the product in both the package options so that it may attract the customers looking for a dessert. There is no need for any price modification for the new product, as the cost structure associated with the new variety is expected to be the same.