MARKETING ENGINEERING FOR EXCEL CASE VERSION 1.0.0
Case
Can the Bunny Hop?
By Arun Pereira, Arun Patro, and Gary L. Lilien
1. Before beginning any case, students should familiarize themselves with the model being used. Marketing Engineering for Excel comes with tutorials that demonstrate the capability of each model. The tutorial can be found under each model within the ME►XL menu after starting Excel. These tutorials are designed to work with our OfficeStar examples, which are located in the My Marketing Engineering directory, usually installed in the Public/Shared Documents folder during the software installation.
2. The following data required for this case are located in the My
Marketing Engineering directory (usually located in My
Documents):
Can the Bunny Hop Data (Positioning).xls
“We fought off Time Warner and held on to the bunny. Now we are saying that it’s too childish! Remember, it is mostly children who consume Nutrine confectionery, not teenagers, not adults. And children love the bunny! My son still remembers the advertisement we ran in the 1980s in Chandamama, with bunnies holding Nutrine SuperStar Toffees. The bunny is our identity. We cannot change what we are!”
—Ganapathy (VP-Operations).
“But things change. Even customers do. The question is, can the bunny hop into new confectionary categories? Will customers accept the bunny in the mints and gum categories?”
—Karthik (VP-Marketing).
Introduction
Nutrine was developed as the umbrella brand (sometimes called the “parent” or “family” brand) for all confectionery products produced by the Nutrine
Confectionery Company (NCC). All the products it launched initially carried only the name Nutrine on their wrappers. To attract its target group of children between the ages of 6 and 13 years, Nutrine used a bunny brand character; this bunny quickly became part of Nutrine’s identity. Many middle-aged Indian consumers still reminisce about the Nutrine Bunny of their childhood—the
Bunny advertisements, the Bunny teeth they received when they purchased a package of confectionaries, such as Kokanaka Cookies. But modern kids are different: more individualistic, more exposed to global media, and highly brand and image conscious. They understand brands through visual representations.
Does the bunny on the wrapper still have broad appeal? More important, is the
Copyright © 2011 by Indian School of Business. Distributed by DecisionPro with permission of the
Indian School of Business.
Nutrine brand still effective as an umbrella brand, which might be extended into new confectionary categories such as mints and gum?
Background1
As competition intensified in the confectionery industry in the early part of the twenty-first century, Nutrine found itself falling behind the competition. After intensive negotiations with both Cadbury and Nestlé, Nutrine finally sold to
Godrej Beverages and Foods (GBFL) in June 2006. In April 2007, GBFL entered into a joint venture with Hershey’s.
But the lack of focus in Nutrine’s brand investments between 2003 and 2006 continued to affect the business and its brands. The Nutrine portfolio 2 contains products in various confectionery categories,3 but its major brands dominate in three: hard-boiled candy, éclairs, and toffee. Two key brands accounted for a whopping 70% of Nutrine’s revenues: Nutrine MahaLacto (hard-boiled candy) and Nutrine Éclairs.
Unfortunately, both key brands were losing substantial market share.
MahaLacto continued to have a strong brand name, independent of its association with Nutrine. Despite minimal branding efforts between 2003 and
2007, MahaLacto ranked eighth in a 2007 brand equity survey, conducted by the Economic Times (behind the chocolate brands Dairy Milk, 5 Star, KitKat, and Perk and heavily advertised brands such as Big Babol and Boomer).
The GBFL–Hershey marketing team had a clear task cut out for it: to define a brand roadmap that would arrest declining revenues, increase the marketing focus on key brands to enhance sales, and build top lines by launching innovative brand extensions into new confectionery categories. A key question considered was whether to continue with Nutrine as an umbrella brand if the company chose to make forays into new categories, such as mints and gum
(which includes both bubble gum and chewing gum).
The Marketing Challenge
Karthik (VP-Marketing), Anupama (GM-Confectionery), and Anand (Brand
Manager, Nutrine) were in the midst of defining such a plan. Anand had just taken on the role of a brand manager, after spending two years in sales.
“Confectionery is not just for kids,” he noted. “In fact, in the mints category, it’s adults who are the major consumers. Coffee-flavored toffees and éclairs also excite teenagers and adults. At present, Nutrine is targeted toward kids.
I’m not sure using Nutrine as the umbrella brand will work for the new categories; I think we must launch separate brands for mints and gum.”
Anand continued: “Think of companies like Wrigley’s and Perfetti. I love
Wrigley’s chewing gum, but I can’t imagine eating a Wrigley’s éclair! On the other hand, Perfetti seems to be doing the right thing. They don’t use an umbrella brand; rather, they have separate brands for each of the confectionery segments. Maybe that’s why all their brands are leaders in their segments. I think we’ll need to do the same.”
Karthik smiled, pleased as always by Anand’s passion and energy. But as a newcomer to marketing, Anand tended to jump the gun. “Anand,” Karthik warned, “it costs roughly $1.25 million to build a brand.”
Anupama added, “Even if we launch separate brands for mints and gum, I think we may still need to work toward creating an umbrella brand for other
1
The details of this case are as of June 1, 2007.
Appendix 2 displays key brands owned by the Nutrine Confectionary Company.
3
Appendix 3 lists all confectionery categories and the key features of each category.
2
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categories. That’s the only way we can create a balance between investments and returns. Also, ITC is doing well using the Candyman umbrella,4 isn’t it?”
Karthik considered Anupama’s comments: “We should try and optimize our marketing spends to sustain MahaLacto and Nutrine for the time being. I’d like
Anand to conduct market research to assess Nutrine’s equity and evaluate if we can extend it across other categories, including mints and gum. We should also assess MahaLacto; given its growing brand equity, it may be wise to see if
MahaLacto can be leveraged for other brand extensions.”
Preface to Customer Research
To start, Anand invited the marketing team and regional sales heads to a meeting and explained the Core Model that he planned to use. The Core Model would help them understand how customers perceive brands, as well as how they perceive other confectionary categories (e.g., mints and gum categories).
The Core Model consists of five groups of elements: those elements that customers perceive as Core to a brand or category, those elements that represent Supporters of the brand or category, elements that are Peripheral to the brand or category, elements that seemingly should be included but are
Absent, and finally elements that act as Detractors from the brand or category in question.
The Core Model
Anand explained that before they could begin customer research, the first step was for them to define a Core Model for confectionaries in general. Doing so meant achieving a consensus opinion about which Core, Supporter, and
Peripheral elements would be common across all confectionary categories.
Then, customer research could focus on brands such as Nutrine and
MahaLacto, as well as on categories such as mints and gum, to compare the research outcomes with the Core Model for confectionaries, identify any
Absentee elements, and highlight Detractors, if any.
After two hours of spirited discussions, the marketing team arrived at a Core
Model for confectionaries (see Appendix 5). The Core elements included Taste,
Indulgence, Flavors, Colors, and Fun. As Supporter elements, the team listed
Crunchy, Soft/Chewy, Sweet, Sour, and others. Peripheral elements included
Friends, Outgoing, Sporty, and Stylish.
“This Core Model for confectionaries will be useful when we complete our focus group discussions with customers, with regard to Nutrine, MahaLacto, and the new categories,” explained Anand. “It will be the basis on which we identify
Absentee elements, as well as determine the degree of commonality in perceptions across brands and categories—all very valuable in deciding if
4
Appendix 4 details the brand architectures of NCC’s key competitors.
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existing perceptions make a case for an umbrella brand extended into new categories.” Focus Group Research
After careful evaluation of the proposals of various market research firms,
Anand chose to work with iMA Advisory to conduct focus group discussions
(FGD) with customers. The FGDs would target 8 to 14 year old consumers and be conducted in various locations across India. Anand chose Chennai,
Vijayawada, Kochi, Kolkata, Ranchi, Mumbai, Ahmedabad, Delhi, and Kanpur as sites for the FGDs. He directed iMA to conduct at least two FGDs at each location.5 The FGD sessions were planned to last one hour, and 12 participants were invited to each session to ensure the attendance of at least 8–10 children. The parents of the children were called in advance and informed about the FGD’s objectives; all children participating in the discussions received gift baskets.
Because the participants were children, the moderators of the FGDs were expected to play a more controlling role than in typical FGDs with adults, to encourage the children express themselves without fear. A facilitation guide with key questions was developed and mailed to the moderators in advance.
The assistant moderators were in charge of taking notes, and all sessions were recorded. In each FGD, two key questions served to stimulate discussion:
What thoughts come to your mind when you think of ____ ?
(Insert brand names such as Nutrine or MahaLacto, or categories such as mints or gum)
This question might not have elicited enough responses from the young participants, so the researchers were also trained to modify the question if needed, as follows:
How would you describe the world of _____ ?
(Insert brand names such as Nutrine or MahaLacto, or categories such as mints or gum)
How would you describe the “_____” boy or girl?
(Insert brand names such as Nutrine or MahaLacto, or categories such as mints or gum)
With these preparations, Anand expected that the FGDs would product rich information that would help them complete the elements of the Core Model for the Nutrine and MahaLacto brands, as well as the gum and mints categories.
Results from the Focus Group Research
Anand painstakingly reviewed all the transcripts for information to help build the Core Model for Nutrine, MahaLacto, and the two focal categories of mints and gum. The completed Core Models appear in Appendix 8.
Assignment
The marketing team at NCC is looking to build on the rich insights they gained from the FGDs and then captured in the Core Models.
Using the information in the Core Models for mints and gum and with some managerial judgment, the marketing team has narrowed down key attributes perceived as relevant for these categories. They hope to use these attributes
5
Appendices 6 and 7 display the FGD plan used, the levels of interactions at various locations, and the process followed to identify the FGD participants.
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to build perceptual maps for both mints and gum. To produce such perceptual maps, consumers of mints and gum need to rate Nutrine and MahaLacto (as well as relevant competitors in these categories) on the selected attributes.
Furthermore, consumers would be asked to imagine their “ideal” mint -and gum (which will likely be fictional) and rate them on the same key attributes.
This exercise would generate the data needed to produce perceptual maps for mints and gum. The maps in turn could illustrate consumers’ perceptions of
Nutrine and MahaLacto on the key attributes, as well as illustrate how they compare with competitors and “ideal” brands.
Mints
The attributes chosen for the analysis: Exciting, Cooling Effect, Chewy, Hard,
Long Lasting, Fresh, and Flavors. The major competitors included in the analysis were Mentos, Chlormint, and Mint-o-Fresh.
Mints Data
The Excel file associated with this case contains data collected from a random sample of mint consumers that reveal the consumers’ perceptions of the major competitors, Nutrine, and MahaLacto on each of the relevant attributes. Also included are consumers’ perceptions of their imagined “ideal” mint. All these data were collected using a rating scale (1 = “Poor,” 10 = “Excellent”).
Gum
The attributes chosen for the analysis: Flavors, Soft, Fun, Center Filled,
Bubble, and Colors. The major competitor included in the analysis was
Boomer.
Gum Data
The Excel file associated with this case contains data collected from a random sample of gum consumers; these data reflect consumers’ perceptions of the major competitor, Nutrine, and MahaLacto on each of the relevant attributes.
Also included are consumers’ perceptions of their imagined “ideal” gum. All these data were collected using a rating scale (1 = “Poor,” 10 = “Excellent”).
Appendix 9 provides the data needed to run the perceptual mapping analyses for both mints and gum.
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EXERCISES
1. Using ME>XL’s perceptual mapping tool, analyze the perceptual data (seen in Appendix 9, and in the dataset) and complete perceptual maps for both mints and gum.
2. Examine the perceptual map (or maps) for mints. What are your recommendations for management as it considers brand extensions using the Nutrine and/or MahaLacto brand name?
3. Examine the perceptual map (or maps) for gum. What are your recommendations for management as it considers brand extensions using the Nutrine and/or MahaLacto brand name?
4. Use the individual-level data on the “ideal mint”(included in the dataset) to investigate the possibility of the existence of more than one ideal mint.
Would your recommendations change after this analysis?
5. Use the individual-level data on the “ideal gum” (included in the dataset) to investigate the possibility of the existence of more than one ideal gum.
Would your recommendations change after this analysis?
6. What are some strengths and weaknesses of perceptual mapping?
Note: This case was written by Professor Arun Pereira, Arun Patro, and
Professor Gary L. Lilien as a basis for class discussion. It is based on real events; however, the names of individuals have been changed. The material and events described in this case represent only a small part of a larger research study conducted by the company. The company was not involved with the materials or data associated with the Assignment section at the end of this case.
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Appendix 1: Historical Nutrine Advertising
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Appendix 2: Key Brands
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Appendix 3: Confectionery Categories
Confectionery can be classified into nine categories: hard-boiled candies (HBCs), toffees, éclairs, mints, gum, jelly cubes, fruit/mint rolls, digestive candies, and lollipops. Nutrine currently does not have any products in the mints, gum, jelly cubes, or digestive candy categories. Segment
Market
Contribution
Growth
Key Brands
Bubble Gum
12.2%
Medium
Boomer, Big Babol
Chewing Gum
6.9%
High
Centerfresh, Happydent, Orbit
Mints
18.9%
High
Mentos, Chlormint, Mint-O-Fresh
Digestive Candy
2.0%
Stagnant
Hajmola
Éclairs
12.3%
High
Cadbury, Nestlé, Nutrine, Candyman
Fruit/Mint Rolls
3.8%
Medium
Poppins, Polo, Rol-a-Cola, Mint-O
Hard-Boiled Candy
27.8%
High
MahaLacto, Alpenleibe, Candyman Licks
Jelly Cubes
0.4%
Low
Lollipops
2.0%
Medium
Mr Pops, Alpenliebe
Toffees
13.6%
Medium
Kismi, Coffy Bite, Aasay
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Appendix 4: Brand Architectures of Key Competitors
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Appendix 5: The Core Model for Confectionary
Appendix 6: Focus Group Discussion Plan
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Appendix 7: Focus Group
Interaction, and Processes
Locations,
Levels
of
Process for Identifying Focus Group Participants
Step 1: Schools are identified in each city, and iMA checks its database to see if any activities have been conducted by iMA or other affiliated agencies in the school. If a contact list is already available, the contact list is vetted, and students are chosen from the list.
Step 2: If iMA has not been associated with the school in the past, the key contact of iMA gets in touch with the administrators and requests permission to conduct an activity on campus; specifically, the Nutrine company asks to conduct a taste test for a new product on campus.
Step 3: If the school approves of the activity, a representative is sent to campus to run the taste test.
Step 4: A stall is set up for a couple of hours toward the end of day [as students wait to be picked up by their parents]. The iMA representative invites students of various ages to step up for a taste test and records their feedback.
Step 5: Enthusiastic students are asked if they would be interested in participating in similar exercises. Contact information is requested from the parents/guardians (if present); alternatively, the students are asked for the contact details of their parents (this was rare).
Step 6: iMA representatives call parents/guardians and give details about the FGD and the prizes and gifts their child could receive with a couple of hours of activity. Interested parents are invited to the FGD on a specified day.
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Appendix 8: Completed Core Models
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Appendix 9: Perceptual Data for Mints and Gum
(see the Excel spreadsheet associated with this case)
Confectionary Category: Mints
Perceptual Data: Average score that each brand (as well as the average "Ideal Mint") receives on each attribute from a sample of mint consumers (participants rated each brand on every attribute on 1–10 scales).
Brands / Attributes
Mahalacto
Nutrine
Mentos
Mint-O-Fresh
Chlormint
Ideal Mint
7.3
4.0
5.0
8.1
6.0
4.0
7.0
6.8
4.2
7.6
7.1
3.0
3.3
3.0
4.4
7.7
6.3
6.9
7.0
5.5
5.3
6.0
6.5
8.0
7.2
6.2
4.0
6.5
7.0
6.4
8.5
6.0
6.1
4.8
8.0
8.1
8.4
7.2
7.6
7.0
8.0
7.0
Exciting
Cooling Effect
Chewy
Hard
Long Lasting
Fresh
Flavours
Confectionary Category: Gum
Perceptual Data: Average score that each brand (as well as the "Ideal Gum") receives on each attribute from a sample of gum consumers (participants rated each brand on every attribute on 1–10 scales).
Brands / Attributes
Flavours
Bubble
Fun
Center Filled
Soft
Colours
CAN THE BUNNY HOP? CASE
Nutrine
7.3
6.9
6.2
5.9
3.6
4.0
Mahalacto
6.8
4.3
4.2
5.2
3.0
3.3
Boomer
8.0
8.3
8.0
7.0
8.8
7.6
Ideal Gum
9.0
8.7
8.5
7.2
9.0
8.8
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