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BPMM6013 MARKETING MANAGEMENT

Brannigan Foods: Strategic Marketing


Planning

Group Members:
Kamalanathan Perisamy 820330
Rajendiraperasad Muniam 820309
Shubashini Mathyalingam 820283
Lilambikha Raja Vikraman Varman 820275

Overview
Characters:Bert Clark (Vice President & General
Manager)
Srikant Thipa (Director of Simple Meal
Unit)
Claire Mackey, (Director of Finance and
Planning)
Anna Chong (Chief Innovation Officer)
Bob Pugh (Director of Sales & Marketing)

Introduction
Brannigan Foods Soup Division 40% of the firms revenue.
Steady decline (3 years) divisions of sales, market share,
and profitability
Reverse the decline - increase
the growth back to 3-4%.
Each Managers suggest
different plan
1. Investing in the growing
sectors
2. Acquiring product lines,
3. Investing in organic
growth,

Situational
Analysis

5 Cs
Analysis

COMPANY
100 year legacy
RTE(71%), Dry Soups, Healthy
Soups, Fast and simple meals
Cash cow- 40% of total sales
Acquiring & integrating Anabelles
products into Brannigans product
line
Increasing market share by brand
awareness

COMPETITOR
Major competitors - General Mills
Small competitors - Roaring Cajun
Food
- Red Dragon Food
- Brothers Gourmet
Other competitors - Private labelled
soups which increases the sales to 5%
Less shelf space for Brannigan
products

CUSTOMER
Current market: Baby boomers
Targeted group: Young
generation, young & working
mothers
Trends: Innovation of new
flavours

COLLABORATORS
Decrease of 3% in Brannigans
Shelf Space
Must ensure that retailer
goodwill doesnt fall
Retailers would appreciate price
cuts that may boost sales
Supermarkets sold 62.9% of the
category
CONTEXT
Micro: 1) Political and
regulations environment
2) Economics
environment
3) Social and cultural
environment
4) Technological
environment
Baby boomers generation is
becoming older
Society, trend, fashion: Healthy

SWOT Analysis

STRENGTH
-100 years in line:
market leader in high
market share
- high brand
awareness with 14%
of sales
-RTE soups are still
considered as staple
food in the United
States
OPPORTUNITY
-New product
innovation to increase
sales
-Liaise with retailers
to generate
continuous solution to
obtain a win-win
situation

WEAKNESS
-Sales decline in past 3
years
-Failure in identifying
society behavior and
trend
-No integration
between
teams( Finance,
Marketing& Sales,
R&D, Simple Meal
Unit) due to lack of
THREATcommunication
-Private labelled
products grows, which
reduces Brannigans
shelf space availability
-New product from
various competitors
-Gap between product
offered and consumer
needs

Objective
To increase the profit and
market share back to 3-4%

Attract new customer & increase


customer lifecycle of the brand

Enhance existing product with


innovative healthy concept

Suggestion

1. Invest in Growing Sectors


Reinforce former strategy but increase investments in the dry soup, fast
meal and healthier soups category.
PROS:
Categories demand is growing supported by trend towards fast but healthy
meals
Canned soup category is declining
Potential rapid market share growth due to retailer and consumer market
strength
Focused on long term growth
CONS:
Categories are not nearly as large as the canned soups category
Strong competition in the segments
Branningan Foods is behind due to competitors first mover advantages

Earning Projection as per Tiphas


recommendation (in $ million)
Year

2011

2012
7979

2013
Forecast
8230

2013
Tipha
8230

Net Sales of Brannigan Food


WW
Net sales of US Subdivision
Less:
Cost of Good Sold
Marketing, R&D and Selling
Expenses
Other Expenses
Net Earning
Broken out marketing and
selling expenses
Advertising and Promotion

7330
3034

1669
425

2973

1635
416

2913

1602
408

2954

1625
426

625
315

627
295

600
303

620
283

189

178

178

188*

With this strategy Brannigans Net earning


wouldn't increase, but will reduce by 4%

2. Acquire product lines to


complement the core in growing
sectors
Healthier and convenient segments that have new flavors
PROs:
Acquisitions represent being present in the new flavour & healthier category
Potential market share growth due to retailer and consumer market strength
Potential increase in sales around 1.5-3.5% to sales within 5 years
House of brands? Advantage- get more self space, different brands.
CONs:
Healthy & Asian category demands could also be targeted by using existing
lines
Cannibalization on existing lines (0.3-0.6%)
Branningan would have to take on debt
Breakeven might be later than expected

Earning Projection as per Claire


Mackey recommendation (in $ million)
Year
Net Sales of Brannigan Food WW
Net Sales of US Subdivision
Less:
Cost of Good Sold
Marketing, R&D and selling
expenses
Other Expenses
Net Earning
Broken out of marketing and
selling expenses
Advertising and Promotion

2011
7330
3034

1669
425

2012
7979
2973

1635
416

2013
8230
2913

1602
408

2014

2856

1570
422

2015

2799

1539
422

2016

2743

1509
423

625
315

627
295

600
311

600
273

588
260

576
247

189

178

184

184

184

185

This strategy isnt profitable either since Brannigan s


net earning decreasing by average 7% per year

3. Invest in organic growth from


internally developed new products
To milk the cash cows and subsidize the investment of the
star products
New flavors, Innovative packages & New usages
PROs:
Brannigans Traditional strengths are reinforced (new products
build on Brannigans most popular soups).
Consumers changing needs would be addressed and consumer
desire for innovation in the category could be served.
CONs:
Cannibalization on existing lines due to 90% chance of Brannigan
having to take out core product to place product in shelf.
Increasing intolerance of retailers to bring in products with shortterm life-cycles failing to meet sales and profit expectations,
possible stocking fees, returns etc (apprx. $1000 per failed product)

Earning Projection as per Anna Chong


recommendation (in $ million)
Year
Net Sales of Brannigan Food WW

2011
7330

2012
7979

2013
8230

2014

2015

Net Sales of US Subdivision

3034

2973

2913

2856

2799

Less:

Cost of Good Sold

1669

1635

1602

1570

1539

Marketing, R&D and selling


expenses
Other Expenses

425

416

427

423

419

625

627

612

600

588

Net Earning

315

295

287

287

281

Broken out of marketing and


selling expenses
Advertising and Promotion

189

178

189

185

181

With this alternative, Brannigans net profit wouldnt


increase but instead decrease 2% on average per

4. Invest in the Core


+ $20MM marketing to increase brand awareness.
Decrease prices of the Ready to Eat soups by 5 cents
PROs:
Decline in operating income can be stopped while sales
volume and recapture of market share could be increased
Favorable in retailers view due to increased sales
expectations
CONs:
Uncertainty about possibly higher sales
Cutting price might lower the perceived value of
Brannigan products

Earning Projection as per Bob Pugh


recommendation (in $ million)
Year

2011

2012

2013

2014

2015

Net Sales of Brannigan Food WW

7330

7979

8230

Net Sales of US Subdivision

3034

2973

3211

3398

3596

Less:

Cost of Good Sold

1669

1635

1766

1869

1978

Marketing, R&D and selling


expenses
Other Expenses

425

416

447

447

447

625

627

642

714

755

Net Earning

315

295

356

369

416

Broken out of marketing and


selling expenses
Advertising and Promotion

189

178

209

209

209

In this case, this alternative seems profitable;


Brannigans earning will be increase during the next

Option 3
-The leader position in
the market obliges
Brannigan to invest in
R&D due to the
changing trends and
needs of the market.
-to invest in
marketing to make
the RTE soups strong
in the market.

Option 4
-reinforce the cash
cow of the division
which are the Ready
to Eat Soups.
-keep financing the
question mark
products, which will
become stars and
future cash cows
with the way the
This mix of both strategies certifies the companys
market is growing.
short term goals and envisions long-term profits with
the investment made, since it stretches the life cycle of
the RTE soups and boosts growth in the early stages of

Implementation
Increase R&D budget from $14M to $19M to develop
prototypes
Invest heavily in Marketing testing and launch new
products
Launch Deluxe Gourmet Deli line with few flavors
Launch Dry Soup line with Advertising few flavors
Raise Retailer margin for new lines by 5% to gain shelf
space for new products
Invest in Heart Healthy Promotion

Marketing Mix

4 Ps
PRODUCT
Implementation of Umbrella brand of Brannigans
soups division which gives emotional values to the
products and brands targeted different market
segment
Various product range that provides various benefits
Positioning Statement:
For people who enjoy health, easy to cook, Savoury
food, Brannigans soup is a brand of soups that offers
convenient varied, trustworthy and very good quality
soups that loves customers to enjoy meals while
taking care of their health and to save time at very
competitive prices based on its experience as leader
in the category and its innovative products.

PLACE
Distribution are major concern
Entries of private labelled
soups with constant growth of
5% due to price increase
3% shelf space reduced

PRICE
Maintain the price of RTE
soups
Tag higher price for Deli
soups, this will create a
Compromise Effect to
consumers by building an
impression of high quality
products
Shift consumers preference
by giving superiority of Deli
soup.

PROMOTION
-Pull strategy is used on Mass
Media and Digital for
discounts, offers and
promotions
-Sales Force:
:- must be reorganized to
increase 4% sales earnings per
year
1)A 20-80 division( 20%
farmers-80% hunters) to
increase the search and
acquisition of new retail
partners
Salaries:
1)Mix of fixed and increased
percentage of the variable part
2) Sales force teams will be

MARKET
Fragmentation and
growing new trends
has caused a change
in the strategy
MISSION
Reposition the brand
as an innovation
company that owns
the leadership by
increasing the life
quality of its
MEASUREMENT
consumers.
Digital marketing
impacts

MEDIA
TV ad and social
media
MONEY
$170 million budget for
marketing expenses of
year 2013

MESSAGE
Create
emotional
value

Objective

Increase Sales
Engage Consumers
Offer Value
Improve Brand
Image

Company website
Adv & promotiondigital sites
Social networkFacebook. Twitter,
Youtube

Conclusion
If investment is done in core segments of Brannigan Foods as
suggested by Bob Pugh, net earnings increase up to 399 million or
3.05% growth year on year. The sales would increase up to 3186
million by 2014.
Being market leader in Ready to Eat (RTE) segment Brannigan
should look forward to maximize profit on maturing product.
Clark also has to decide on a long term strategy. Look to cater to
customer preferences by developing new products internally.
Additional expenditure of around 5 million in R & D and also
additional promotional costs for the new products, the costs can be
met by the increased profits due to the increased investment in the
core products.
This would also reinforce Brannigans image as an innovator and
help increase its brand equity among customers. As such, Clark
would need to adopt both Option 3 and Option 4 to successfully
satisfy all of his decision criteria.

Thank You

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