Barton Fredrick is the marketing director of Pemberton Products, a company that produces baked goods and acquired Krispy Inc. in 2008 to enter the salty snack market. Pemberton had $5 billion in sales in 2011. The document discusses Pemberton's plan to expand into the cracker market by building capabilities in salty snacks, developing healthier cracker options, improving distribution through its direct store delivery system or hiring a new distribution team, and setting a sales objective of $500 million with a 13% profit. It also analyzes the cracker market trends, results of product testing, and potential competitive responses from Frito-Lay's entry into the cracker market.

1. Cracking The Product Management
Cycle
Cracking The Product Management Cycle

2. What is Pemberton
Products?
And
Who is Brandon Fredrick?

3. Food bars,
cookies and
sweet baked
foods
Softies cookies
Home style
muffins and
donoughts

4. Barton Fredrick is the marketing director
of Pemberton.

5. So what is the special about Pemberton
products?
Acquired Krispy Inc. In 2008- first step
towards entry in salty snack market.
$5 billion sales in 2011
Owns and uses direct store delivery
(DSD)

6. Building a collection of
attractive durable minds.
DSD systems to increase
revenue and profits.
Building or acquiring
capabilities in salty
snack categories.

7. U.S Cracker Industry
Estimated 6.9 billion in 2011
CAGR of 2.2% from 2008-10
Increased growth of 6.2% in general in 2010
Annual growth forecasted between 10-14% for crackers with filling.

10. 74%
respondents
consumed
crackers on
regular basis.
34% ate them as a
part of regular
diet.
53%
considered
overall
healthfulness.

11. Market Trend
Healthier and conveniently
packaged crackers for the consumers
Pepperbridge
Farm
Goldfish
(2010)
Kraft’s
Nabisco
Wheatthin
Flatbread
(2009)
Kellog’s
Keebler
Townhouse
Flatbreads
(2010)

12. Krispy Single vs. Krispy Natural

13. Healthy snacks- 100%
whole wheat and
natural ingredients
Increase
package
sizes to
multiple
servings
Improve taste
by
introducing
new flavours

14. Distribution
Long shelf life
of crackers
Present
capacity of
trucks poor
DSD system
may not
work for
cracker
business, so
Pemberton
hired
“Krispy
Force” for
distribution
system

15. Sales Objective
•Natural distribution of crackers
•Minimum sales of $500 million
•Steady state pre-tax profit of at least 13%

16. SWOT Analysis
STRENGTHS
1. World renowned product
development labs.
2. Product mix.
3. Company owned DSD
WEAKNESSES
1. Capacity constraints of
DSD for Krispy natural
products.
OPPORTUNITIES
1. Market research shows
consumer dissatisfaction
with favour and taste
experience of current
cracker brands.
2. Cracker market
fundamentals were
attractive
THREATS
1. Fritto-lays entering the
cracker market.
2. Modest increase of 1% sale
in southeast.

17. Product Testing Summary

20. Conclusions
Interpreting Market Results
1. Grabbed 18% market share in Columbus as a new entrant in
salty snacks business.
2. Kraft, Kellogg and Pepperidge in total lost 10% of market
share, despite of higher demands cracker products since 2010.
3. Forecasted National roll out sales figures in Columbus and
Southeast scenario for 3rd year depicts PBT more than 13 %
and sales more than $500 million.

21. Possible Competitive Responses
To New Brand “Fritto-Lay”
1. Launching more new products mix as per customer
taste and keeping health as a priority concern.
2. Optimization of DSD system for Krispy natural product
for cost reductions.

22. DISCLAIMER
Created by Prateek Chatterjee, VIT University
during a marketing internship under Prof. Sameer
Mathur, IIM Lucknow.