Oscar Mayer - Case Write Up

Oscar Mayer – Strategic Marketing Planning CASE WRITE UP

Submitted by: GROUP 1, SEC A John Michal Franklin Saurabh Mishra Sumeet Panda Varun Mohan Kashyap Shivankit Kumar

Introduction We must address some very important questions before we analyze the challenges faced by Oscar Mayer with regards to there strategic marketing planning , the answers to which affect our decisions in every way. 1. WHAT is there business? Oscar Mayer are amongst the finest quality of cold cuts meat manufacturers (Red Meat and White Meat) under the Kraft Foods Inc. umbrella. Their main products include: Hotdogs, Bacon and Bologna. 2. WHO is there consumer? Their target audience is working mothers and children. Although their advertisements have always featured kids, the purchasing power and decision making lies with the lady of the house. Hence, their target market is strictly devoted to housewives and working mothers. 3. What is of VALUE to the consumer? Nutrition/Quality, Convenience and taste is of most value to the consumer. 4. What will our business BE? This question purely deals with the forecasting figures that the company can project based on current performance. Oscar Mayer’s sales volumes have been decreasing per year and may land up in a crunch if it continues with the same performance. Louis Rich (OM’s sister concern) has been profitable, however, at a slow growth rate per annum. 5. What SHOULD there business be? Oscar Mayer’s desire was to revive their brand growth and increase volume sales. The gap between the forecasted gains and desired gains of Oscar Mayer is what gave rise to four different opportunities to eventually achieve the desired result through the right strategic marketing decision.

Corporate Mission: We assume that Oscar Mayer’s mission would be: “To deliver maximum nutrition, in minimum time through quality driven packaged meat products”

Strategic Formulation: Posing in front of Oscar Mayer lay four different strategies to choose from. So which one DID they choose? Let’s have a close look at the strategies and beyond.

1. Option 1: Backing the winning horse – Louis Rich 2. Option 2: Acquiring smaller companies of interest 3. Option 3: Develop a fourth category of products to the existing three, and 4. Option 4: Invigorating Oscar Mayer brand growth The option WE think is the best for the company IT is the Introducing a NEW Product which is the best compared to others. The main strategy adopted in this opportunity is that which is commonly known as Differentiation Strategy by Porter’s Generic Strategies, where the firm tries to provide a superior performance product uniquely designed to provide value to their target audience and is well appreciated by them. Having already conducted R&D, aware of who the target audience is and what they are looking for, two products have been designed to suit their needs; Lunchables and Zappetites. This allows Oscar Mayer to stay in the lead, eliminate competition and do what they do best – INNOVATE. Oscar Mayer has contributed to 82% of the company’s profits and has been the leading brand amongst others. Given the above option of diverting investments to Louis Rich only just because it is currently generating profits for the company, will make way for Louis Rich to overshadow Oscar Mayer. Heavy advertisement influx does not necessarily lead to increase in volume sales either. Products suggested by the Louis Rich line does not promise a successful product and does not necessarily cater to the consumers need. Above it all, the pure Louis Rick investment seems too concentrated to focus all efforts. So the first option is not the least viable The disadvantage would lie with the fact that they would have to increase their debt in order to acquire such businesses which are potential markets but are not sure to succeed. Not taken into account are also the Advertisement and packaging costs which hold great value when you count on consumer convenience and brand growth. So second option is still fairly viable. Suggested price cuts are not always taken in a positive light. It sometimes brings a negative effect on a products performance. Oscar Mayer over the years has earned their customer’s trust by being quality certified and believes you get what you pay for. Focussing purely on just bringing Oscar Mayer back into the limelight also reduces the scope of diverting investments and efforts into bringing to life something “new”. So the last option is partially viable.

Arriving at a Strategic Decision It is of utmost importance that while trying to achieve the goal set by the Company, that they operate within the set corporate mission. At this stage, Oscar Mayer has 6 points to pay utmost attention to in arriving at a decision which will eventually determine their success. They are as follows: 1. 2. 3. 4. 5. 6.

Taste Increases sales volume Nutritive Value/Quality Convenience Achieve long term gains Accelerate brand growth

RECOMMENDATION From the above, we arrive at the following conclusion: Option 3 – New product Development deems most viable. Option 2 – Acquisition of smaller businesses seems fairly viable. Option 4 – Oscar Mayer brand growth is partially viable. Option 1 – Backing only Louis Rich is least viable.