Product Planning Cuisinart Hand Mixer

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A report I wrote on Cuisinart's hand mixer portfolio for a Portfolio Management class.

A report I wrote on Cuisinart's hand mixer portfolio for a Portfolio Management class.

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  • 1. Cuisinart Power Advantage Plus 9-Speed Hand MixerDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 2. Cuisinart was founded by Carl and Until Cuisinart was sold in 1989, the brand Bought in 1989 by Conair, Cuisinart has Shirley Sontheimer in 1971 after a trip to image that Mr. Sontheimer wanted for his been able to turn around the company. France. While in France, the couple went company was one of excellence without The Cuisinart Division has been able to to a housewares show where they saw cutting corners. However, the steep regain it’s leadership in small kitchen resturant grade food preperation machines. price caused many customers to seek appliances through top quality and Confident they could make a home version other options, causing Cuisinart to finally innovative new products. Conair has been of the food processor, Sontheimer obtained rush out products to meet the customers able to target the high-end appliance U.S. distribution rights from Robot-Coupe changing needs. This though was not soon customers, both at home and in commercial and utilizing his enginering background, enough and Cuisinart continued to lose spaces through the ownership of both the Mr. Sontheimer was able to redesign the market share to new innovative products Cuisinart brand and the Waring brand. restaurant food processor for home use. that recognized the changing needs of the From a $20,000 investment, Mr. and Mrs. potential customer. Sontheimer created Cuisinart, a company Through expanding product that combined their passions for food and offerings and winningCarl Sontheimer appliance elecrtonics. endorsements from the restaurant industry, Conair’s new strategy helps push Cuisinart’s sells up Cuisinart goes from 20% to losing market share to competitors who are offering a variety of form “With marketing savvy and a credible product.. factors those cost less. Cuisinart begins the strategy to able to dominate the upper end of the food align with cooking eduction by processor business...did it by making the producing cook books, cooking Cuisinart name synonymous with top quality Conair purchases Cuisinart shows, and a culinary institute. and price.” for an estimated $27 million. EVA POMICE, Forbes BIRTH OF A NEW MARKET 1971 1973 1973-74 1975 1977 1977-early 80s 1985 1988,’89 America is Initial sales Sales pick up Cuisinart sales Cuisinart Cuisinart loses Cuisinart off twice until Founded introduced to are poor do steam as Cui- total $50 mil- dominates the considerable continues to Conair buys Cuisinart Food consumers sinart picks up lion dollars and market the market share lose market the company. Processor at unsure of the endorsements the new part- corporation to Sunbeam share do to not Cuisinart now the National benefits plague from culinary nership with a created. They and their understanding only has 12% Housewares Cuisinart figures such as Japanese firm become syn- smaller and their custom- of market Expo in Julia Child. as the manu- onomious with cheaper food ers shifting share. Chicago. facturer the gourmet processor desires. Sold kitchen chefDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 3. STENGTHS WEAKNESSESCuisinart is the best known for History plagued with corporate Product Leadershipbeing among the highest quality scandalkitchen appliance available Often a market follower, enteringKnown for pursuing excellence in existing product categoriescooking education through bothvideo and formal educationprogramsPartners with market leaders indesired marketsDesign + Eco-friendly consciouswhich wins various awards and Customer Intimacy Operational Excellencerecognition for their effortsReputation built on endorsementsfrom well known chefsAccording to Macy’s + The Knot Cuisinart is number 1in the small applaince for the kitchen brand for weddingregisteries 1989 Conair focuses 1995 2000 > the company’s The introduction of Cuisinart continues energy to hand mixers and to enter new product become the toasters gives breadth categories. They number one to an assortment expand their registry requested considered among the presense beyond brand in bridal best in the highend bridal showers to registries appliance arena. include expecting mothers and parents.Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 4. CURRENT PORTFOLIO PRICE POWER SELECT POWER ADVANTAGE POWER ADVANTAGE PLUS $80Cuisinart’s hand mixer portfolio is Power Advantage PLUSmade up of 3 lines, the Power 9-Speed Hand Mixer withSelect, Power Advantage, and Power $75 Storage Case $79.95Advantage Plus. USP:storage case to store $70 mixer and accessoriesDIFFERIENTATIONThe designs of the Power Select andother two differ greatly. Each $65category has a selection of speedsavailable according to price point.The Power Advatange Plus stands $60out due to the storage case and Power Select 7-Speed Power Advantage CORE COMPETENCIESbeing the only product available at Hand Mixer 7-Speed Hand Mixer -Technology delivering9-speed. Speeds available differntate $55 $59.95 $59.95 power and versitility USP: Pink line series, USP: Smooth-start -High qualityproducts according to price for non-splatter with a portion of proceeds going PORTFOLIO THEMES +SIMILARITIES $50 to breast cancer CHARACTERISTICSThe technology behind the motors research Power Advantage -Power delivered through 5-Speed Hand Mixerare quite similiar, using a 220 watt $49.95 220 watt motors with $45 automatic feedbackmotor along with automatic feedback USP: Multiple colors -Exclusive swivl cord allowthat senses when more power needs for right or left handed useto be delivered to mix ingredients. $40 -Chef grade compnents -Wide range of colorsOVERALL availableLittle differentiates these products -Wide range of speed $35 optionswith smoothbesides the number of speeds the transitions between speedsmotor can spin the attachments. The -Style and designed tonumber of color selections for the $30 match other appliancesPA 5-speed suggests this price point Power Select 3-Speed -Easy clean upis most attractive for customers. Hand Mixer $29.95 USP: Unique Style and price point of a Cuisinart ProductDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 5. MIXING AND MIXERSConsumers will continue to want quick access and quick cleanSTAND MIXERS HAND MIXER HAND BLENDERstrengthsgreat at mixing large batches great at mixing for baters, mashed quick to grab and use potatoes etc.weaknesseslarge and heavy requiring a becoming the new too large to pull can only occomplish jobs ofdedicated spot in the ktichen out tool. certain sizes: eg. not the best at mixing medium size amounts of ingredients POWERFUL GOOD ENOUGH INCONVENIENT CONVENIENTDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 6. MARKET ANALYSISHAND MIXER MARKET LIFECYCLE FOOD MARKET TRENDS DESIGN TRENDS Consumers are continueing to cook more at For small kitchen appliances, more and more home. Just about half (53%) of meal prepar- manufactures are offering a wide range ers now make dinner, including an entrée, of colors across their product offerings. four or more nights a week; 90% do so at “Thomas Perez, president of Bodum USA, least once a week. In addition, 61% prepare said, “The insurgence of color at the turn of a frozen entrée, and 36% pick up a prepared the economy was an uplifting notion. Color entree at least once a week (TARNOWSKI, is particularly important in small electrics 2011). With cooking at home, consumers are due to their countertop placement. You want going to purchase appliances that offer the them to ‘pop’ on your countertop and not right amount of convenience and most num- tucked away in your cupboards.”” ber of uses (BRANDL 2008). Along with color, offering classic white Foodies, people who identify themselves as and stainless steel shows both a heritageIntroduction Growth Maturity Decline interested and knowledgeable about a wide and sophistication, matching many of the range of foods and ingreidents will con- larger appliances in the kitchen such asCuisinart’s first hand mixer was introduced tinue to grow. Over half of adults watch, on the stainless steel fridge or range oven.in 1995, adding to Cuisinart’s increasing average, 4.2 hours per week (FMI, 2011) of Cuisinart offers both a wide range of colors,presence across multiple products in the cooking shows. Interest in preparing food at along with the classic white and stainlesssmall kitchen appliance category. home and entertaining at home will continue steel. to grow.When Cuisinart entered the hand mixer Eco-friendly design choices and effectivemarket, other brands had established With food safety concerns continueing to use of technology will continue to becomethemselves as the market leader. After hav- grow, consumers will become more aware important to customers as they also look foring lost considerable marketshare to other of where and what they are putting in their an authority to reassure them of thechallengers, Cuisinart was playing catch body. Again this will result in more home eco-friendly claims. Cuisinart has madeup in multiple categories during the 1990s. eco-friendly manufacturing and marketingNeeding a new strategy, Conair’s strategy a core strategy, launching their green-focused on targeting the bridal industry.1 ware line in 2008 called “Cuisinart GreenThis allowed Cuisinart to gain market share Gourmet”. 2and become the #1 hand mixer sold throughAmazon.com, Macy’s, and recommended Retro design to stand out is continuingas a great gift by theknot.com. to attract customers. Cuisinart’s Power Select is reminisent of a large jet engine,While a mature industry, Cuisinart has connecting to both the image of power, butbecome synonymous with hand mixers. also bringing images of “when flight was sexy and cool”.1. Cuisinart History About Us, 2. Rodgers Discusses Cuisinart’s Green Strategyhttp://www.cuisinart.com/about.html http://www.hfnmag.com/housewares/rodgers- discusses-cuisinart%E2%80%99s-green-strategyDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 7. COMPETITORSKEY COMPETITORS High PriceChallengerKitchen Aid’s, whose parentcompany is Whirlpool, hand mixerscontinue the company traditionof high quality appliances. KitchenAid Artichtect rank 1 in ConsumerReportPrice range: $59.99 - $109.99.FollowersOffering a wide range of homeproducts, Sunbeam’s hand mixeroffers style and conveniencePrice range: $18.99-39.99 Functional StyleManufactures both small appliancesand hair cair products for a lowprice. $24.99 -$29.99Under NACCO, both HamiltonBeach and Proctor Silex offer awide range of kitchen appliances.Hamilton Beach price range:$19.99 - $49.99Proctor Silex price range:$10.99 - $15.99This price range allows NACCO tohit multiple price points and keeps Low Pricethe brands from competing witheach other.Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 8. COMPETITORSCuisinart is a market leader in many NEW ENTRANCES Moderate. Customerskitchen appliance categories. show a considerable amount of brand loyalty to Cuisinart hand mixers. However, Cuisinart will need to move more agres-According to Amazon.com of 5 most sively into developing countries to build relation-requested hand mixer 4 of them are ships with customers.Cuisinart Hand Mixers SUPPLIERS RIVARLY BUYERSTOP 20 HAND MIXERS ACCORDING TO SALE NUMBERS Low. Components do not Moderate. High density Moderate. CustomersCuisinart - 40% require a high degree of low end prodcuts want to cook moreHamilton Beach - 15% of sophistication. may begin to impact meals at home. This isKitchen Aid 10% Little supplier power Cuisinart’s hand mixer due to many becoming as a result, allowing BU as rivals offer more more price sensitive.Proctor Silex 10% Cuisinart to find a new competitive prices Companies with the bestSunbeam 5% supplier if put into a along with quality build reputation built throughOster 5% pricing situation. and design. high quality build and helping customers get the most out of theirHowever, while Cuisinart enjoys a lead in the hand mixer purchase.category, challenger rival Kitchen Aid has been awardedConsumer Reports best of hand mixers in November 2010.Cuisinart did make the top 10 two times, at 4th and 5th place, SUBSTITUTESKitchen Aid however went on to be awarded 1st, 3rd and 6th High. Customers are look-place. According to the Consumer Report, Kitchen Aid and ing for more convenienceCusinart were virtually identical in all categories except for and the hand blender maynoise. Cuisinart will need to recognize this and re-examine take over most mixingthe quality of motors and build to improve the noise reduction jobs, only taking out theof the hand mixer. hand mixer for specific tasks.Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 9. COMPETITIVE LANDSCAPE FROM SCRACTCH Table Top Mixer Combo Indoor Grill Sunbeam Mixer Hamilton Kitchen Beach FORM CATEGORY Spoon GENERIC BUDGET Aid Hand Mixers Kitchen appliances Kitchen tools Less then $100 that can mix food Proctor Oster Silex Toaster Spatula Hands Hand Blender Single-Serve Coffee Maker CONVENIENT + QUICK TO CLEAN UPDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 10. SEGMENTATION SEGMENT HEALTHY EATERS GRAB AND GO MOMS FAMILY MOM KITCHEN GOURMET DEMOGRAPHIC Adult Males + Females Adult females with children Adult females with children Adult Males + Females 25-35 years old 34-44 34-44 18-35 PSYCHOGRAPHIC Healthy eaters are individuals Grab and go moms are busy Family mom are women who These indviduals enjoy food who place high value on being women with families. They are place a high priority on their and the culture of food. Many able to eat healthy. This also looking for convenience at a family and the family’s health/ self-identify as foodies and love means that they are interested good price. Being able to relay well being. These are women exploring new food choices in a healthy environment, on their small kitchen appliances who are aware of the latest and options. They are willing to connecting where and how their is important because they have health consernes, as well as try new recipes. They look for food is produced. They shop little time to repurchase, modify, natural remedies for tasks kitchen appliances that will have based on their values when or fix. These women wish they ranging from cleaning to a number of uses and capability. considering a purchase. These could provide healthier options maintaining a healthy body. The appliances they choose individuals are highly skeptical for their family, but price and These women place importance represent them, identifying with of companies advertising eco- time keeps them from being able on their home, wanting to make brands that represent quality and friedly products due to “green to fullfil this desire. They also the home feeling welcoming. the gourmet home chef. Kitchen washing”. Healthy eaters will believe in eating as many meals Family moms also try to cook gourmets will cook a majority of also cook a majority of their at home as possible, and strive from scratch every meal at the their meals at home, but also go meals at home, looking to to cook at least one meal a week home, relying on ready made out more often during the week maximize how they use their from scratch, but often rely on meals infrequently. They believe to try new restaurants and find ingredients in order not to waste. ready made meals more often. the from scratch equals whole new ideas to bring home to their healthy foods that shows they own kitchen. are caring for their family in a special way.Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012 - Photos from http://healthfoodxdrinks.com/ http://planetgreen.discovery.com/ http://o5.com/ http://www.aycinena.com/
  • 11. CUSTOMER ANALYSISHIGH Healthy Eaters Kitchen Gourmet Wants to support a Wants the best tool company who shares possible and willing to their values. pay a premium Grab and Go Moms Family Mom Wants a product that Wants products that helps in the process fit her style and represents a woman who loves her familyLOW BRAND FUNCTION PRICE STYLE EASY OF USE/ CONVENIENCE SENSITIVE CLEAN UP Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 12. CUSTOMER ANALYSISPRICE Healthy Eaters Grab and Go Moms Family Mom Kitchen Gourmet $80 Power Advantage PLUS Power Advantage PLUS 9-Speed Hand Mixer with 9-Speed Hand Mixer with Opportunity to move into $75 Storage Case Storage Case the higher price point with $79.95 $79.95 a eco-friendly product. $70 Opportunity to include more Opportunity to introduce colors at the premium price the Power Select @ 9-speed $65 point. with more colors. $60 Power Select 7-Speed Power Advantage Hand Mixer 7-Speed Hand Mixer $55 $59.95 $59.95 $50 Power Advantage Power Advantage 5-Speed Hand Mixer 5-Speed Hand Mixer Opportunity to include a $49.95 $49.95 $45 storage case at the same price point. $40 Power Select 3-Speed Hand Mixer $35 $29.95 $30Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 13. ANSOFF 2 x 2Cuisinart will maintain leaders in the small kitchen appliance market by developingnew products that help customers get the most out of their cooking experience. CUSTOMERS NEW EXTEND INNOVATIVE EXPAND EXTEND INNOVATIVE A Soup Appetit D My virtual chef G Skinniefied Mixer A New product line for Develop the Cuisinart Create a new forum factor E developing countries that Digital Cookbook that goes that embraces a smal ler helps in recipes beyond from coaching for the footprint to descrease the just baking. Eg. China is novice to helpful reminder perseption of the product the number one consumer for the gourmet chef. being too large. F of soups. E Second hands H Mini-Hand Mixer B B From Zero to Gourmet Ingredient mixer wil l help Cuisinart for Kids wil l D Help the novice cook learn pour in new ingredients create a product safe for more about cooking. as needed. children to use. F Talk to me I Greenest Ever J PENE TRATE PENETRATE EXPAND Select the recipe from Develop evo-friendly C Color my world crazy digital cookbook and upload product out of heavy duty Offer the Power Select the directions to the hand ceramics, using zero I in more colors and at the mixer. Helps keep track of plastics and recycled metal G 9-speed to attract design time, step(s), and next for the various tools. conscious customers. ingredient. J Battery GO! C H Charging station for battery “pucks” for a wireless hand mixer. Capture the energy created CUR RENT PRODUCTS from the momentium of mixing ingredients together.Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 14. EVALUATIONCuisinart should look towards developing countries+ re-think the forum factor of the hand mixer. e ag ss CUSTOMERS NEW e ew ty nc ne nt s l R bili ie va rta d ive nc ar si EXTEND INNOVATIVE Ad po ct te a Fe tra Im pe ive r A de m At al ic tit ia E Or Co ic eg pe t nc ke hn t k al re m na ra ar n c t Co Co Ra Te To St Fi M Soup Appetit 7 4 7 5 7 7 37 1 F B From Zero to Gourmet 6 7 5 7 5 5 35 3 D 2 4 4 5 7 3 8 Color my world crazy 25 My virtual chef 6 5 6 7 7 3 34 4 PENETRATE EXPAND J Second hands 3 5 3 3 3 4 21 10 Talk to me 6 7 5 5 4 6 33 5 I G Skinniefied Mixer 7 7 4 6 7 4 36 2 Mini-Hand Mixer 6 5 6 5 4 5 31 6 C H Greenest Ever 7 4 4 5 3 4 27 7 Battery GO! 3 4 3 4 5 5 24 9 CUR RENT PRODUCTSDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 15. RECOMMENDATION 1Cuisinart should develop hand mixers that fit the culinaryneeds of each individual countries they expand into.With rapidly expanding markets around Along with getting the endorcements of thesethe world, Cuisinart should begin to form culinary celebrities, Cuisinart will need topartnerships with market leaders in each understand the types of food these marketsdeveloping country they wish to enter. make. Currently the hand mixer in AmericaMuch like Cuisinart did in the United States, is used primarily for baking and recipesdeveloping partnerships with key figures in requiring whipping (fresh whip cream oreach country will help make their brand name mashed potatoes). However, each countrya household name in these new markets. will have unique needs that Cuisinart willFinding the Rachael Ray of Brazil or the need to understand in order to develop theMartha Stewart of China will help give their best attachments to meet the expectationsproducts credibility as being American made of these new customers.and loved by those key culinary figures.Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 16. RECOMMENDATION 2The hand mixer should be re-designed to fit the grab-and-go societythat desires convenience and good enough over perfect.The hand mixer currently is becoming too big as a design + user criteria principle whenfor many users since the rising popularity prototyping a new re-design that embracesof the hand blender. While Cuisinart brand is light weight materials, quick clean up, quickalso one of the most popular hand blender tool selection, and smaller foot print.manufacturers, these tools are not the best atmixing many types of dishes. A re-design of the hand mixer to better suit the expectations of the customer, from theRecognizing the changing expecations of the grab-and-go mom to the kitchen gourmet,users, but still wanting to be the brand of Cuisinart could re-invent this productculinary excellence, Cuisinart should adopt category by bucking the statis0-quo designthe convenience motto and raise the bar from and look to slim and compact the design togood enough back to perfect. Cuisinart can the ready-to-go tool.only do this by using the convenience mottoDouglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012
  • 17. BIBLIOGRAPHY “Cuisinarts’ moniker due to appear on more items in new catego- ries.” HFN The Weekly Newspaper for the Home Furnishing Net- work, http://www.thefreelibrary.com/Cuisinarts%E2%80%99+mo niker+due+to+appear+on+more+items+in+new+categories. -a016050593 New housewares products: appeal to the senses (and the sensible)., HFN Home Furnishings News, 2011, http://www.thefreelibrary.com/ New+housewares+products%3a+appeal+to+the+senses+(and+the+s ensible).-a0253447888 Cuisinart Market Share, http://www.answers.com/topic/conair- corporation-1 Cuisinart History About Us, http://www.cuisinart.com/about.html Kitchen Design Trends. http://www.nyc-appliances.com/top-trends- in-kitchen-appliances.htm Top 10 Food Trends, April 2011, http://www.ift.org/food-technology/ past-issues/2011/april/features/food-trends.aspx?page=viewall Rodgers Discusses Cuisinart’s Green Strategy, http://www.hfnmag. com/housewares/rodgers-discusses-cuisinart%E2%80%99s- green-strategy Small Appliance Market Will Stay Strong , International House- wares Association Editorial, January 2008, Phil Brandl BUSINESS PEOPLE; Conair Head Planning Strategy for Cuisinarts, ANTHONY RAMIREZ, January 9 1990 Consumer Report, November 2010, page 40. Douglas Radecki // Cuisinart Power Advantage Plud 9 Speed Hand Mixer // Product Planning Spring 2012