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Pillsbury Answer
Pillsbury Answer
I. EXECUTIVE SUMMARY
The case discusses the challenges faced by the Canadian Pillsbury Refrigerated Baked Goods
(RBG); the declining performance (sales) of the cookie line segment has caused the management
to rethink their strategy. The marketing manager is under a lot of stress to come up with a
strategic plan that could help turn around the performance of the cookie segment before a serious
problem takes hold. In order to gain useful insights about consumer attitudes, preferences and
behavior towards their product, Ivan Guillen - the marketing manager, decides to conduct a
market research with the help of consumer insight team. In addition to gaining an in-depth
understanding of consumer preferences and attitudes towards the category, the research was also
aimed at finding out the desired attributes and perceived brand image of the product.
What I analyzed from the case is that the company was focusing too much on the product and
was ignoring the most important variable in the equation – the end consumer. Furthermore, I
believe, they somehow missed a very important target segment – kids as they were targeting
mothers (age 30-40) only. The company needs to redesign their marketing strategy, needs to
come up with powerful ATL and BTL campaigns to attract customers, not to mention the overall
marketing strategy needs to be customer-centric. New products especially made for the Canadian
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#1: What are the challenges that Ivan Guillen faces?
The largest international segment of the General Mills Inc; General Mills Canada Corporation
(GMCC) is the market leader in packaged food market. There are four business units in the
Canadian division: snacks, baked goods, meal and breakfast; these business units are in turn
divided into 12 categories and RBG or refrigerated baked goods is one of the most profitable
The challenge faced by Ivan is big; he is the marketing manager of the RBG category and he
needs to come up with a solid strategy to turnaround the segment. Over the past 5 years, the
category has experienced only moderate growth. Pillsbury dominates the refrigerated baked
goods category with 85% market share. Representing 62% of the total unit volume (of the
category), cookies are the most profitable SKU’s in the RBG category. Ivan believes that in
order to turnaround the segment’s performance, he needs to focus on growing the refrigerated
cookie segment.
Now the situation is that, this segment is experiencing issues in terms of sales performance; sales
volumes between fiscal 2004-2006 has remained almost flat at 1% and the household penetration
of has also decreased to 24%. In order to design a strategy that works for the segment, he needs
to understand the possible reasons of declining performance of the segment and for that he calls
for a market research to gain useful consumer insights. The primary objectives of the market
research were to find out: if there was an issue with the taste, the brand message, or the target
market.
Low Brand Budgets in Canada
Wrong Target Market (Targeting mothers only)
What are the underlying drivers and motives that drive To design a mind-blowing, consumer-
To understand the product usage and attitudes of sales volume, increasing household
customers towards RBG cookies
penetration (of the cookies) and to improve
To gain insights about customer preferences
overall growth of the RBG category.
towards the brand and the product
To find out the underlying cause of declining
performance with a focus on figuring out whether
the issue lies in the product formula, the brand
message or the target audience and to find the
differences & similarities in terms of attitudes &
behavior of US and Canadian consumers
Short-Term vs. Long-Term Problems
Hence, the short term goal was to improve volume The long-term goal was to improve penetration
growth by redefining the marketing mix of cookies (cookies) and improve the overall growth of the
The market research is done and now Ivan needs to use the findings of the research to design a
strategy that effectively answers all concerns. His focus is on leveraging the research findings to
increase the purchase frequency and market penetration of RBG cookies, to define the target
market, brand message, and how to communicate the message in a way that results in increased
sales.
III. CAUSES OF THE PROBLEM
#2 what are consumer insights? What type of business challenges can benefit from
Before discussing the causes of the problem in detail, I’ll answer the question on consumer
insights based on what I’ve learned from class lectures. Consumer insight’, in simple words is
the understanding of your customer based on their behaviors, attitudes and preferences. Few
things are as complex as understanding what drives your consumer’s attitudes and behavior and
this is where consumer insights come in. Conducting market research activities to gain useful
information about consumer attitudes and behavior is nothing new. Nevertheless, with changing
demographics, consumer preferences and influx of new businesses, businesses are spending a big
chunk of their marketing budget on market research activities like these. In short, consumer
insight is an in-depth understanding of customer needs and wants and is essentially the
Businesses can leverage the power of customer insights by making use of critical information to
address issues related to the performance of their products in the market, before introducing new
products, to obtain feedback about their products and services, and when designing marketing
strategies to make sure they’re aligned with the needs of the customers, to name only a few.
Consumer insights are obtained through market research either conducted by internal marketing
team of a company or a research agency. The research could be qualitative or quantitative and
may include focus groups, in-depth interviews, surveys, product testing/usage, attitude surveys
preferences and attitudes because he wanted to understand the underlying causes of the two
major challenges that RBG cookies segment was facing - declining penetration and flat volume
growth. From the case, we know that RBG category is highly dependent on the performance of
their Pillsbury cookies because they constitute more than 60% of their total category sales
volume. However, even though, the category held a leadership position in their sales volume
remained flat at 1% from 2004-06 and the penetration had fallen from 24%.
I believe one of the major causes of the problem is that GMCC despite being an autonomous
division, leveraged new products & advertising campaigns from the US region, primarily due to
high production costs and because of low brand budgets in Canada, ignoring the differences in
consumer taste, attitudes, preferences, and behaviors of Canadian and US consumers. The
research also revealed that there were significant differences between the Canadian and US
customers, which demanded due consideration. Secondly, the company was targeting mothers
aged 30-40, a very narrow target market. The values offered were taste and ease. I believe they
missed out the most profitable target market when defining their target audience – kids and teens
and young people. Furthermore, the value offered also needs modification like rich, luxurious
experience, cherishing good times – something that touches their emotions rather than talking
#3 Given the key leanings from usage & attitude study, what are the corresponding implications
The primary objective of the attitude survey was: to gain insights on the product usage behaviors
and attitudes of Canadian customers and to find out the similarities and differences in the
attitudes, preferences and behaviors of Canadian and US customers. ‘Screeners method’ was
employed by the research agency to screen the participants for the study by asking a set of
questions. Based on their responses they were divided into three main categories:
1. Users - who had bought the Pillsburry cookies during the last 12 months
2. Lapsed users - who had last purchased the Pillsburry cookies about a year ago
3. Non-users - who never bought the RBG cookies (these could be the potential customers)
Canada, Scratch from scratch (from the very and focus on offering
Canada vs. US baking is more first step). This could be something like a
Interpretations Implications
Canada US
1
Exhibit 7 – Casestudy
"Is a high-quality 29% 41% In Canada, the RBG cookies are The brand message should
cookie dough" not considered a quality substitute talk about the nutritional
"Makes the right 23% 33% Canadian customers are not Demographic information
employed
"Helps you create a 19% 24% This value was never emphasized Information regarding
a luxurious, heart-felt
experience to consumers
# 4 Develop perceptual maps for potential targets (users, lapsed users and potential
Findings
attributes
needed"
2
Exhibit 8 – Case study
Users and non-users both The company can
something 48% 31% 30% that the product could be making special
Brand awareness
Both users and lapsed
needs to be
users agree that they
"I use the dough emphasized upon in
don’t use the dough for
in my own 10% 4% 19% addition to
creating their own
recipes" communicating
recipes
product usage to
consumers
#5 Why did Guillen and his team conduct the in-home and discovery workshops?
While the usage and attitude surveys offered useful insights on major differences between US
and Canadian consumers, these didn’t answer a very important aspect of branding: does the
product experience resonate with most consumers? This information was very crucial for
Two research studies; in-home immersions and a discovery workshop were then conducted by
1. In-home immersions – Also known as Ethnographic Research, the primary aim of in-
and preference with regard to the product. For the purpose of this research, mothers (the
target market) were asked to buy cookies beforehand and bake them when the research
team visited them. In-home immersions revolve around immersing yourself in the world
of consumers and observing them in their environment. To gain a more realistic, dynamic
view of the consumer and the consumer-brand relationship while getting to know about
other important things like the kitchen type, the cooking rituals etc, in-home immersions
the only difference is that these take place outside the homes of research participants.
Another difference was that these workshops were collaborative in nature and for the
purpose of research 18-27 were invited for a working session. The workshops were
share their experiences, thoughts and opinions about the product. A number of techniques
were used to help consumers express their honest opinions including role playing,
customer-experience mapping.
IV. RECOMMENDED SOLUTION, IMPLEMENTATION & JUSTIFICATION
campaigns and stop leveraging the US campaigns. Campaigns from the US could be used
only when products match the preferences of both markets (US and Canada) and not for
3. Target Market (Finding New Customer Segments) – The target market needs to be
redefined. They are currently targeting mothers only, they need to include explore other
4. Promotional Campaigns – The element of fun, interest and entertainment should also be
included in the advertisements for teens and kids. It is a known fact that kids are the main
campaigns, which needs to be added. All these elements including ease of use, multi-
purpose, and nutritious should be efficiently communicated through their BTL and ATL
activities.
5. New Products Development – More products need to be offered especially for the
Canadian region, with customized recipes for the market. They can also collaborate with
some cooking show – a sponsored cooking show that promotes the multiple uses of the
2. Reach out to new consumer segments (kids, teens, young people) – (market development)
3. New product development – products designed for the Canadian market keeping their
REFERENCES:
1. Bryman, A. and E. Bell (2003). Business Research Methods. Oxford, Oxford University
Press