Reference no: EM13204863
CASE:
GENERAL MILLS WARM DELIGHTSTM: INDULGENT, DELICIOUS, AND GOOEY!
Vivian Milroy Callaway, vice president for the Center for Learning and Experimentation at General Mills, retells the story for the "indulgent, delicious, and gooey" Warm DelightsTM. She summarizes, "When you want something that is truly innovative, you have to look at the rules you have been assuming in your category and break them ail!"
When a new business achieves a breakthrough, it looks easy to outsiders. The creators of Betty Crocker Warm Delights stress that if the marketing decisions had been based on the traditions and history of the cake category, a smaller, struggling business would have resulted. The team chose to challenge the assumptions and expectations of accumulated cake category business experience. The team took personal and business risks, and Warm Delights is a roaring success.
Planning Phase: Innovation, but a Shrinking Market
"In the typical grocery store, the baking mix aisle is a quiet place," says Callaway. Shelves sigh with flavours, types, and brands. Prices are low, but there is little consumer traffic. Cake continues to be a tradition for birthdays and social occasions. But consumer demand declines. The percentage of U.S. households that bought at least one baking mix in 2000 was 80 percent. Four years later, the percentage of households was 77 percent, a very significant decline.
Today, a promoted price of 89 cents to make a 9X12 inch cake is common. Many choices, but little differentiation, gradually falling sales, and low uniform prices are the hallmarks of a mature category. But its not that consumers don't buy cake-like treats. In fact, indulgent treats are growing. The premium prices for ice cream ($3.00 a pint) and chocolate ($3.00 a bar) are not slowing consumer purchases.
The Betty Crocker marketing team challenged the food scientists at General Mills to create a great-tasting, easy-to-prepare, single-serve cake treat. The goal: Make it indulgent, delicious, and gooey. The team focused the scientists on a product that would have:
• Consistent great taste,
• Quick preparation,
• A single portion, and
• No cleanup.
The food scientists delivered the prototype! Now, the marketing team began hammering out the four Ps. They started with a descriptive name "Betty Crocker Dessert Bowls" (see photo) and a plan to shelve it in the "quiet" cake aisle. This practical approach would meet the consumer need for a "small, fast, microwave cake" for dessert. Several marketing challenges emerged:
• The comparison problem. The easy shelf price comparison to 9 X12 inch cakes selling for 89 cents would make it harder to price Dessert Bowls at $2.00.
• The communication problem. The product message "a small, faster-to-make cake" wasn't compelling. For example, after-school snacks should be fast and small, but "dessert" sounds too indulgent.
• The quiet aisle problem. The cake-aisle shopper is probably not browsing for a cake innovation.
• The dessert problem. Consumer's on-the-go, calorie conscious meal plans don't generally include a planned dessert.
• The microwave problem. Consumers might not believe it tastes good.
In sum, the small, fast-cake product didn't resonate with a compelling consumer need. But it would be a safe bet because the Dessert Bowl positioning fit nicely with the family-friendly Betty Crocker brand.
Implementation Phase: Leaving the Security of Family Behind
The consumer insights team really enjoyed the hot, gooey cake product. They feared that it would languish in the cake aisle under the Dessert Bowl name because it didn't fully describe the essence of what the food delivered. They explored who really are the indulgent treat customers. The data revealed that the heaviest buyers of premium treats are women without children. This focused the team on a target consumer: "What does she want?" They enlisted an ad agency and consultants to come up with a name that would appeal to "her." Several independently suggested the "Warm Delights" name, which became the brand name.
An interesting postscript to the team's brand name research: A competitor apparently liked not only the idea of a quick, gooey, microwavable dessert but also the "Dessert Bowls" name! You may now see its competitive product on your supermarket's shelves.
Targeting the on-the-go women who want a small, personal treat had marketing advantages:
• The $2.00 Warm Delights price compared favourably to the price of many single-serve indulgent treats.
• The product food message "warm, convenient, delightful" is compelling.
• On-the-go women's meal plans do include the occasional delicious treat.
One significant problem remained: the cake-aisle shopper is probably not browsing for an indulgent, single-serve treat.
The marketing team solved this shelving issue by using advertising and product displays outside the cake aisle. This would raise women's awareness of Warm Delights. Television advertising and in-store display programs are costly, so Warm Delights sales would have to be strong to pay back the investment. Vivian Callaway and the team turned to market research to fine-tune the plan. The research put Warm Delights (and Dessert Bowls) on the shelf in real (different) stores. A few key findings emerged. First, the name "Warm Delights" beat "Dessert Bowls." Second, the Warm Delights with nuts simply wasn't easy to prepare, so nuts were removed. Third, the packaging with a disposable bowl beat the typical cake-mix packaging involving using your own bowl. Finally, by putting the actual product on supermarket shelves and in displays in the stores, sales volumes could be analyzed.
Evaluation Phase: Turning the Plan into Action!
The marketing plan isn't action. Sales for "Warm Delights" required the marketing team to: (1) get theretailers to stock the product, preferably somewhere other than the cake aisle, and (2) appeal to consumers enough to have them purchase, like, and repurchase the product.
The initial acceptance of a product by retailers is important. But each store manager must experience good sales of Warm Delights to be motivated to keep its shelves restocked with the product. Also, the Warm Delights team must monitor the display activity in the store. Are the displays occurring as expected? Do the sales increase when a display is present? Watching distribution and display execution on a new product is very important so that sales shortfalls can be addressed proactively.
Did the customer buy one or two Warm Delights? Did the customer return for a second purchase a few weeks later? The syndicated services that sell household panel purchase data provide the answer. The Warm Delights team evaluates these reports to see if the number of people who tried the product matches with expectations and how the repeat purchases occur. Often, the "80/20 rule" applies. So, in the early months, is there a group of consumers that buys repeatedly and will fill this role?
For ongoing feedback, calls by Warm Delights consumers to the free consumer information line are monitored. This is a great source of real-time feedback. If a pattern emerges and these calls are mostly about the same problem, that is bad. However, when consumers call to say "thank you" or "its great," that is good. This is an informal quick way to identify if the product is on track or further investigation is warranted.
Good Marketing Makes a Difference
The team took personal and business risks by choosing a Warm Delights plan over the more conservative Dessert Bowl plan. Today, General Mills has loyal Warm Delights consumers who are open to trying new flavours, new sizes, and new forms. If you were a consultant to the Warm Delights team, what would you do to grow this brand?
1 What is the competitive set of desserts in which Warm Delights is located?
2 (a) Who is the target market? (b) What is the point of difference on the positioning for Warm Delights? (c) What are the potential opportunities and hindrances of the target market and positioning?
3 (a) What marketing research did Vivian Callaway execute? (b) What were the critical questions that she sought research and expert advice to get answers to? (c) How did this affect the products marketing mix price, promotion, packaging, and distribution decisions?
4 (a) What initial promotional plan directed to consumers in the target market did Callaway use? (b) Why did this make sense to Callaway and her team when Warm Delights was launched?
5 If you were a consultant to Vivian Callaway, what product changes would you recommend to increase sales of Warm Delights?