First in Show Pet Foods

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SITUATION ANALYSIS

EXTERNAL ANALYSIS

Opportunities: • The growing popularity of organic food with the sales growing by 64 percent from last year. • The dog food industry can benefit from the absence of a completely frozen dog food market in the Boston metropolitan area. • More than fifty percent of the dog food market is still untapped thus there is an immense potential to grow in this market.

Threats: • There are almost 50 dog food manufacturers with 350 dog food brands in the U.S. However, there are five companies that have approximately 75 percent market share of U.S dog food sales in 2008. • The larger advertising budgets of competitors can be a threat to maintaining market share with a brand with flat
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ALTERNATIVE 2: Do not Increase the existing retail price and target a mass audience
With the same program budget level of USD 500,000 (used in alternative-1) First in Show Pet Foods, inc. can charge its retail consumers a price of $12.77/ case. Within this promotional budget, there will be one short television commercial, same number of newspaper and magazine insertions as alternative-1. Presently the retail price First in Show Pet Foods can charge to its consumers come to $12.77 per case i.e. $0.07/oz (Exhibit 2). The company should market the product at this price to a larger target consumer base by differentiating on the basis of cost.
Advantages: First in Show Pet Foods, Inc. strength is its product quality. If the company can market at a price of $12.77/ case i.e. $0.07/ oz, they will have the advantage of offering a high quality organic product at a price lower than most of its competitors. By competing at a lower price they will be able to capture the major portion of the 240 million Boston market. In the long run this strategy will also help the company to expand as a nation-wide brand.
Disadvantages: The lower retail price of Show Circuit will definitely help to build and expand their brand across the Boston metropolitan area but the major concern is the sales volume. Given the list price of $12.77/ case, First in show Pet Foods, Inc. will have to produce and sell a very high volume to have any sort of return on investment.

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