kingsford charcoal case

8/17/2019 Kingsford Charcoal Case

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By: Abinesh Manoharan, Aditi Jagdish, Meryem Bektas, Sabari Ram & Swetha Vasu

Kingsford Charcoal case

1 EXECUTIVE SUMMARY

Kingsford Charoa! om"any has two hoies# short term "ro$ts %s !ong termgrowth, and we strong!y reommend the !atter'n this regard, we suggest strategies to ti!t the beha%iora! "atterns of the ustomersthrough sensory branding, reati%e ad%ertising tehni(ues and o"tima! "riing# a!!of whih wi!! ontribute towards inreasing the om"any)s ustomer base whi!e a!sostrengthening its brand e(uity

2 INTROUCTION ! "RI##IN" TRENS

Kingsford Charoa! is res"onsib!e for about *+ of C!oro)s re%enue and a higher"erentage of its net inome Any negati%e trend in haroa! sa!e wi!! thereforea-et C!oro)s bottom !ine Some reent trends in the industry are as fo!!ows:

. A!though the number of gri!!ing oasions ha%e inreased from ./B in .*01to o%er 2B in the year 3444, the o%era!! market growth of the haroa!ategory has dereased from /+ to 3+ in 3444

3 More "eo"!e ha%e started using gas gri!!s 5his has !ike!y been in6uened byinreased ad s"ending on "romoting the sa!e of gas gri!!s

2 'n addition, the retai!ers ha%e inreased the "rie of haroa! for Roya! 7akand other "ri%ate !abe! brands 8hi!e before the inrease, there was a "riega" of 39#24+ between the "ri%ate !abe! "roduts and Kingsford withKingsford being the higher "ried "rodut;, it has now signi$ant!y dereased

5his has !ike!y diminished Kingsford)s di-erentiation fator as a "remium !abe!/ A!so, Kingsford, whih has the biggest share of the haroa! market with !ose

to


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hea!thier than "an fried food2 De%erthe!ess, gri!!ing with its e!ements of $re, henedanger and shar" too!s is genera!!y !eft to men and they in turn onsider it theirterritory3

( MARKETIN" STRATE"Y

5he brand management team of Kingsford haroa! has two hoies # fous on

inreasing the "ro$t numbers for the brand or to kee" the "rie onstant and fous

on inreasing the o%era!! haroa! ategory, thus enab!ing !ong#term suess for the

brand

5he haroa! ategory s!owdown was aused by %arious reasons suh as inreased

retai!er "riing fue!ed by "rie inreases among the "ri%ate brands and Roya! 7ak,

inrease in "enetration of gas gri!!s, the absene of media ad%ertising, !ak of

"romotiona! ati%ity and inreasing!y unfa%orab!e weather onditions for gri!!ing

oasions A!though the "rie inreases among other brands inreased Kingsford)s

sa!es %o!ume, the !ong#term suess of Kingsford was tied !ose!y to the o%era!!

suess of the haroa! ategory @ene, we reommend that the brand

management team shou!d fous on inreasing the siEe of the "ie rather than

maimiEing the brand)s "ro$t, whih wou!d rather be a short#term strategy

5he key to inreasing the o%era!! haroa! ategory wou!d be to fous on the two

fators under ontro! fous on "romotiona! ati%ity and inreasing the fre(ueny of

haroa! "urhases by Kingsford)s ustomers 8e reommend that Kingsford shou!d

fous its "romotiona! e-orts towards the F'nstant Ae"torsG ustomer segment

beause it is the !argest segment


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between memorab!e gri!!ing e"erienes and the Kingsford brand 5his has the dua!ad%antage of inreasing brand awareness and raising brand e(uity

5he 3 s"ei$ ob=eti%es that the brand managers need to ahie%e with thisad%ertising strategy wou!d be to he!" Ameria rediso%er its "assion for gri!!ing anda!so to inrease the number of asua! gri!!ing oasions among their target

ustomers 5his ensures that the brand is assoiated with a who!esome fami!ye"eriene as we!! as u!inary de!ights instead of being re!egated to =ust s"ei$ho!iday oasions Some of the s"ei$ tatis they an use in!ude:

. sing reati%e and suggesti%e bi!!boards to on%ey brand meaning Exhibit 1;3 'n%o!%ing ustomers by engaging them in BBI ook#o-s thus "utting the brand

front and enter of ommuna! ooking e"erienes Exhibit 2;2 7rganiEing food truk e%ents around the ountry to showase haroa! gri!!ed

de!iaies Exhibit 3;/ Starting a strong soia! media am"aign by in%iting users to submit their fa%orite

haroa! gri!!ed inno%ations in interest and 'nstagram Exhibit 4;9 Choosing a e!ebrity s"okes"erson who embodies the desirab!e attributes suh

as the authentiity assoiated with haroa! gri!!ing Exhibit 5;

+ MU#TI,SENSORY *RANIN" A''ROAC-

5o tru!y engage with ustomers on a "rima! !e%e!, Kingsford needs to ado"t methodsto strong!y im"rint the brand)s identity on the onsumers) subonsious "syhewithout being o%er!y aggressi%e 5his great!y enhanes the hanes of a suessfu!brand rea!! by forming the neessary a%!o%ian assoiations Some brands o"t touse sub!imina! messaging to ahie%e this desired e-et but Kingsford wou!d bene$tby o"ting to engage the ustomers through mu!ti"!e sensory out!ets 'n this asethe sense of sme!! wou!d be an idea! hanne! sine aording to Mare! roust, thee-et of sent an un!eash a 6ood of memories thus ho!ding the key to !ong !astingim"ressions/ Kingsford an work with retai! stores to infuse the haroa! ais!es withthe sent of gri!!ed meat & %egetab!es and a!so !ine the wa!kways and "arking !otswith images of burning oa!s and suu!ent gri!!ed food >hibit


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on 7"tion 3 whih wou!d resu!t in a de!ine of sa!es %o!ume by //9 MSC units andresu!t in "ro$ts of S 3.0,4448e be!ie%e this wou!d be the o"timum !e%e! of "rieinrease that wou!d he!" us im"ro%e short term "ro$ts as we!! as tie in with our !ongterm growth strategy 't wou!d be in !ine with our strategy of im"ro%ing our brande(uity by di-erentiating our brand with a s!ight!y higher "rie but at the same timenot making it etreme!y "riey so as to a!ienate eisting as we!! as "ros"eti%e

ustomers

8e understand that this strategy wou!d resu!t in the retai!ers "u!!ing bak on themerhandising su""ort .4+ merhandising !oss on .4 & 34 !b bags to be "reise;@ene Kingsford wou!d ha%e to su""!ement the "romotiona! ati%ities with e-ortsfrom its side 8e be!ie%e this is sti!! ahie%ab!e sine the inreased re%enues wi!!he!" to maintain a "ositi%e bottom !ine A!so sine the u!timate aim is to be ab!e toinrease the brand e(uity in the !ong run, we wou!d urge the management to !ookbeyond the immediate short term im"at on "ro$ts

/ A''ENIX

E0hii 13 *illoard ca45aigns

E0hii 23 **& Coo6,o7s


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E0hii $3 Moile %ood r8c6s sho9casing Kingsford:s associaion 9ih

grilled food


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E0hii (3 User generaed Insagra4 5ic8res of heir fa;orie grilling4o4ens


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E0hii )3 "8< %ieri as a s5o6es5erson for Kingsford charcoal

E0hii +3 I4ages o e 8sed in reail sho55ing areas o rigger i458lsesassociaed 9ih grilling


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E0hii .3 Calc8laions o deer4ine 5ricing sraeg<

S!Do riing Senarios

>stimatedrobabi!ity

of

7utome

>stimated

L43Vo!ume

MSC;'m"at

>stimated L43

Sa!es

444;'m"at

>stimated L43

ro$t

444;'m"at

>stimated

>-eti%e

Vo!umeMSC;

>stimated

>-eti%e

Sa!es444;

>stimated

>-eti%e

ro$t444;

.C!ubH@ome Center, /+rie 'nrease

A Do merhandising !oss

kingsford charcoal case

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