Frito Lay Company – Cracker Jack Case Analysis
Carl James
MBA:Marketing Strategy
September 19, 2014
Frito Lay Company- Cracker Jack Case Analysis
Case Recap
Frito Lay, a division of PepsiCo Inc, has just purchased the Cracker Jack brand from Borden Inc. The company is a worldwide leader in the manufacturing and marketing of snacks, with products such as Ruffles Potato Chips, Fritos Corn Chips and Doritos found among its product mix. These well known company brands have seen it capture over 50 percent of the retail sales, and company officials envisage Cracker Jack can only but add to the richness of its product line and profits. Borden, because of its strategic decision to concentrate resources elsewhere, discontinued aggressive…show more content… Although it has respectable brand equity due largely to its heritage and generally favorable image foundation, still only 7.1 percent of U.S. household consumes the product. This sorry state of affairs based on survey respondents is primarily due to: * Not thinking of the product * No product triggers created from advertisement * Product unavailability * Low prize value contained in packages * Low overall perceived value * Premium asking price * Product size vis-à-vis price point.
While substantial hurdles to overcome, whatever the strategy Frito Lay adopts, it must inculcate revitalization of the product, correct price points, expanding of distribution channels, developing of new packaging, reduction in the number of SKUs from its current 32, product positioning and increased advertisement targeted at consumers.
SWOT Strengths: • Strong brand awareness • Frito Lay’s extensive sales and distribution channels • Seasoned well funded national advertiser • Strong presence in consumer food | Opportunities: • New product category allows Frito Lay to reach new customer base • Continued growth of snack foods market • Better product positioning within retail establishments will make product more easily seen and readily available • Promotional activities aligned to capitalize on trademark awareness potential | Weaknesses: • Brand is perceived as stale, dated and “unhip” by new consumers • Price: Incorrect price
