3. Background
Founded in 1989,
Natureview Farm
manufactured and
marketed
refrigerated cup
yogurt.
01
Sells 8-oz.(86%
revenue) and 32-
oz.(14% revenue)
cup sizes of yogurt.
02
Leadership in
natural food
channel.
03
Revenue of
$13million in 1999.
04
4. Key Players
Christine Walker, vice
president of marketing
Jim Wagner, chief
financial officer (CFO)
Barry Landers, Chief
Executive Officer (CEO)
6. Advantages
of
Natureview
farm Yogurt
average shelf life is 50 days as
compared to competitors’ products
which has shelf life of 30 days.
Natural ingredients
strong reputation for high quality
great taste
12. Yogurt Production Costs and Retail
Prices by Channel
Natural Food Channel Average Retail Price
8-ounce (oz.) cup $ 0.88
32-oz. cup $ 3.19
4- oz. cup multipack $ 3.35
Supermarket Channel Average Retail Price
8-ounce (oz.) cup $ 0.74
32-oz. cup $ 2.70
4- oz. cup multipack $ 2.85
Natureview’s manufacturing costs for the three product lines—the 8-oz. cup, the 32-oz.
cup, and the children’s multipack—were $0.31, $0.99, and $1.15 respectively.
13. YOGURT MARKET SHARE BY
REGION
26%
22%
25%
27%
Northwest
Midwest
Southwest
West
16. Option(1) - Expand 6 SKUs of the 8oz product line into one or two
selected supermarket channel regions.
Pros
• 8oz cups represent largest dollar and
unit share of market.
• Supermarkets fear losing market
share to natural food competitors.
• Other natural food brands have
successfully expanded to
supermarkets.
Cons
• Highest level of competitive trade
promotion and marketing spend.
• Possible channel conflict between
supermarkets and natural food stores.
• Little experience in dealing with
supermarket chains.
18. Option(2) - Expand 4 SKUs of the 32oz product line nationally
Pros
• 32oz cups generate an above average
gross profit margin.
• Fewer competitive offering in this
size.
• Lower promotional expense than
Option 1.
Cons
• Higher slotting fees due to national
distribution.
• National distribution will be
challenging within 12 months.
• Possible channel conflict between
supermarkets and natural food stores.
20. Option(3) - Expand 2 SKUs of the children’s multi pack into the
natural food channel
Pros
• Natureview has strong relationship
with leading natural food channel
retailers.
• Financially attractive.
• More time to prepare the company for
moving into supermarket channel.
Cons
• Fast growth of natural food channel
will lead to demands equal to those of
supermarkets.
• Misses opportunity to enter
supermarket channel before
competitors.
23. Pursue Option 1
• Reach well beyond the target objective of 20 million revenue by end
of 2001
• 8 –oz yogurt has highest demand
• In supermarket, can expose to more range of customers
• Will have the first mover’s advantage of natural product to enter
supermarket
• A bit risky but in a long term will generate revenues