Pemberton Products, a snack food division of Candler Enterprises, launched Krispy Natural crackers to enter the growing salty cracker market. The initial launch in 2008 under the Krispy brand focused on single-serve packages in vending machines and convenience stores but did not succeed due to limited product line and poor taste scores. Pemberton relaunched the product as Krispy Natural in 2012 with an improved taste, wider product line including multiple serving sizes, natural positioning and marketing emphasizing flavors. The relaunch was successful due to strengthened product, premium pricing supported by promotions, optimized direct store distribution, and addressing capacity constraints to support growth in the attractive cracker market.

1. Launching Krispy Natural: Cracking The Product
Management Code

2. About Pemberton Products
 Pemberton was the snack food division
of Candler Enterprises, a multinational
beverage and snack goods manufacturer.
 Sold packaged food bars, cookies and
other sweet baked goods.
 Market leader brands were Softies
cookies and Homestyle muffin and
doughnuts.
 Market leader in US cookie and bakery
snacks segment of the sweet market.
 Pemberton Contributes about 28% of
Candler’s total sales.
Sales
Candler Pemberton

3. Strategic Priorities Of Pemberton
 Building strong brand values in salty snack
categories.
 Building a collection of attractive ,durable
brands.
 Applying leadership marketing and DSD- Direct
Store Distribution system to increase the
revenues and overall profits.
 Building a good brand image in the market.
 Building or acquiring capabilities in salty snack
categories.

4. Reasons for Pemberton to take the first step
to enter the salty cracker market ?

5. 1. US Growing Cracker Industry
 The total retail cracker sale was of about - $6.9 billion in 2011.
 There was a total 2.2% increase in CAGR from 2008 to 2010.

6. 2. Research Of Salty Snacks In US
 74% of respondents consumed cracker
on a daily basis.
 Crackers were the top salty snacks ahead
of potato chips.
 Desire of healthy products was driving
cracker industry.

7. Who are the competitors?
 Kraft Food Inc.
 Kelloggs Co.
 Pepperidge Farm
THESE 3 LARGEST BRANDS ACCOUNT FOR 3/4TH OF THE
CRACKER INDUSTRY.

8. The Krispy Product Line
 In 2008, Pemberton entered the salty snack
market with the acquisition of Krispy Inc
who was a manufacturer of single-serve
cracker packages that competed in the
cracker-with-filling and “all other” cracker
segment.
 Their Offering: A package containing 6
round toasted cracker sandwiches with
cheese filling available in 3 flavor options.
 Marketing: They marketed it as “Grab and
Go” with a major presence in vending
machines and convenience stores.

9. Expectations v/s Reality

10. Why did it not work?
 Limited product line – hence no
command over supermarkets.
 Taste - A taste survey showed that the
product did not deliver the flavor scores
that were expected.

11. The Relaunch - WHY?
 The overall scenario and numbers of the
cracker market were still attractive.
 The overall market was huge and was
expected to grow at 10-14% every year.
 Competitors were not capitalizing on the
market available.

12. The Relaunch-how?
ALL OF THE SHORTCOMINGS WERE
ADDRESSED:-
 R&D Labs were engaged to improve the
taste.
 Product line extended beyond single
serve packaging to introduce multiple
serving package sizes.
 It was repositioned as KRISPY NATURAL
which was more indicative to its targeted
customer base.

13. And the results of the Relaunch of Krispy

14. Different Strategies that led to it's Success....
 Product Strategy
 Marketing Strategy
 Distribution Strategy
 Pricing Strategy

15. 1. PRODUCT STRATEGY
 New Flavours.
 Multiple Serve Packing.
 Use of 100% Whole Wheat and Natural
Ingredients.
RESULTS:
77-92% Positive purchase intent for its new flavors.
Four-to-one preference over the leading competitive cracker.

16. 2. MARKETING STRATEGY
 Emphasized on heavy advertisement and
promotion.
 Effective adoption of pull marketing
strategy.
 Hence price discounts offered initially.

17. 3. DISTRIBUTION STRATEGY
 Effective DSD distribution.
 Optimizing system for longer shelf life
of crackers.
 Hired representatives known as “Krispy
force for proper distribution.”

18. 4. PRICING STRATEGY
 Krispy went for a premium pricing
strategy.
 But on the retail side they matched the
prices of their competitor on a “visual
price basis” that is less quantity or
weight for the same price so as to
maintain their premium product image.

19. SWOT ANALYSIS
Strengths
 World renowned product development labs.
 Pemberton is already a market leader.
 Company owned DSD.
 Good Product Mix.
Weaknesses
 Capacity constraints of DSD for Krispy
Natural products.
Opportunities
 Cracker market fundamentals are
attractive.
 Market research shows consumer
dissatisfaction with flavor and taste
experience of current cracker brands.
Threats
 Fritto-lays entering the cracker market.
 Modest increase of 1% sale in southeast.

20. I Thank Prof. Sameer Mathur of IIM Lucknow,
for giving me this wonderful oppurtunity to
learn something new about Marketing.
M. Victor Rezinold,
IIT(ISM), Dhanbad.