Snappy Snacks

Summary:
Molly Smith, product manager for a manufacturer and marketer of spicy snack products, must decide how to address sluggish sales of a newly introduced product. Potentially complicating the situation are Molly’s assistant product managers who appear to have different ideas on what needs to happen to improve sales.

Cost:
$2.99 USD

To Purchase:
Students and others can purchase this case by clicking here.

Information For Educators:
Eligible educators can request a Free Educator Review Copy of this case by clicking here.

Potential Discussion Topics:
new product introduction, gaining retail distribution, niche marketing, product management, pricing strategy

 

Original Image by USDAgov

Planning: Late Maturity Stage

Characteristics
  • Competition: The competitive landscape has stabilized.  The only survivors remaining consist of a few market giants and several small niche firms.
  • Target Market: The market has very few first-time buyers and almost all companies focus on getting existing customers to remain loyal.
  • Product: There is a significant reduction in the introduction of new models. Any new models focus mostly on just a few minor performance enhancements and stylistic improvements.
  • Prices: Overall prices stabilize and may rise due to limited competition.
  • Promotion: Large competitors begin to cut back on expensive promotions designed to attract new customers and focus on reminder promotions to loyal customers.
  • Distribution: Overall, distribution has stabilized with few new distributors agreeing to handle product. For products sold at retail stores, there is a noticeable reduction in shelf space devoted to the product.
  • Profits: Companies see profits recover as demand stabilizes, prices rises, and marketing expenditure to support the product declines.
Brand Strategy

If companies have failed to extend the PLC in the early part of the Maturity stage, there is a low probability the product form will experience growth again. Instead, companies will continue to market the product, albeit with little effort other than making it available to customers who have been purchasing it for some time.

By the late part of the Maturity stage,  marketers that are still selling may no longer consider the product to be important for the future of the organization.  However, this does not mean the product no longer holds value. In fact, the product may be extremely valuable for the profit it continues to generate (a.k.a. cash cow), which is then used to fund new products. Consequently, some attention is still paid to the product but only to ensure that it is still available for those who want to purchase.

Targeting Markets Tutorial

The first few sections of the Principles of Marketing Tutorials have introduced the basic concepts needed as a foundation for building a strong marketing program. In particular, we saw that the essential building blocks for creating a strong marketing program rests with marketing research and a deep understanding of customers. With this groundwork in place, it is now time to turn our attention to strategic decisions undertaken by the marketer to address customers’ needs and help the organization meet its objectives.

As we discussed in the What is Marketing? Tutorial, these decisions include:

  1. Selecting Target Markets
  2. Developing Products/Services
  3. Creating Promotions
  4. Arranging Distribution
  5. Setting Price
  6. Adding Support Services

In this tutorial, we examine decision #1 – how marketers determine which groups of customers to target. This is a critical point in marketing planning since all additional marketing decisions are going to be directed toward satisfying the markets selected.

For those new to marketing, selecting target markets may seem like a relatively easy decision to make. In fact, many inexperienced marketers will simply conclude that “We will just sell to whoever wants to buy.” However, this mindset is both ineffective and inefficient as the marketer is likely to drain resources in their quest to locate those willing to buy. Using a target market approach, an organization attempts to get the most from its resources by following a planned procedure for identifying customers that appear to be the best candidates to respond to the marketer’s message.