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Presented bySUSHANT KUMAR

CASE STUDY

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.1989 .Founded and manufactured in cabot ,Vermont

.Plain vanilla flavor 8-oz and 32-oz .Less than $100,000 revenue earned

1999Revenue reached $13million from $100,000

.Fruit on bottom yogurt.

2000Introduction of multipack yogurt

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Back Bones

Christine Walker VP Marketing

Jim wahner cfo

Burry landers ceo

Wlater bellini vp sales

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Situation

VC needs to cash out of its

investment

Achieving 50% revenue

before the end of 2001

Should NatureView farm expand

into super market?

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• Natural food channels

• Wholesale club

• Low cost guerilla marketing

• Affordable• 8 And 32 oz

Product price

PlacePromotion

Marketing Mix

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14%

86%

Market Share of Products

32-oz8-oz

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SWOT analys

is

Strength.strong brand

.low cost

OpportunityStrong

relationship with

retailers

WEAKNESS.No

alternative financing

THREATSDropped out

from traditional channels

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Organic

Taste/ flavor

Ingredient Packagin

g

Price

Marketing Trend of yogurt purchase

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SUPERMARKET97%

NATURAL FOOD STORE

3%

DISTRIBUTION CHANNELS

SUPERMARKET NATURAL FOOD STORE

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33%

24%

23%

15%5%

SUPERMARKET

DANNONYoPlaitothersprivate labelcolumbe

24%

15%7%19%

35%

Natural food channel

natureview farmbrown cowwhite wavehorizonothers

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Production cost supermarket channel

Natural food channel

Supermarket food channel

Manufacturing cost

8-oz $0.88 $0.74 $0.31

32-oz $3.19 $2.70 $0.99

4-oz multipack $3.35 $2.85 $1.15

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Option Analysis

Option1

Option3Option2

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Option1(to expand 6 sku’s of the 8-oz product line into one or two selected supermarket channel)pros cons

• 8-oz has highest incremental demand.

• Potential to increase revenue.

• High risk(marketing)• Advertising cost $1.2 mn

per region per year.• Need to pay one time

slotting fee.

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Option2(Expand 4 sku’s of the 32-oz product line nationally )Pros Cons

*Higher profit margin than 8-oz

*lower promotional expanses

*Doubt on sales team’s ability to achieve full national distribution in one year.

*The 32-oz expansion option would increase SG&A expanse by $160,000

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Option3(Introduce 2 skus of a children multipack into the natural food channel)

Pros Cons

• The financial potential was very attractive .

• The natural food channel was growing almost 7 times faster than the supermarket.

• There were many conflict which manager could not determine.

• Can not achieve the target objective of Nature view farm.

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Comparison of options for year 2001

Option1 Option2 Option3

Unit sales 42,000,000 5,500,000 27,247,200

Revenue 44,080,000 27,850,000 21,397,600

Net profit 27,247,200 19,934,500 17,130,637

Sushant KUmar

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OPTION1

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Option1(The Best)

• Long term advantages are high if properly implemented

• Exposure to more range of customers.

• It exceeds the revenue objective.

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Conclusion

• Reach beyond the target objective $20 million before the end of 2001

• More customer buys products from supermarket (46%)

• “Guerilla marketing “ 8-oz -86% Revenue• 40%yogurt consumed by U.S. population (70%

women)• Long term revenue generate around 200%.

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Sushant kumar ,IITB Marketing internship under Prof. Sameer Mathur ,IIML