SYEDA ZAUWIA RIAZ
WRITEN ANALYSIS CASE
PILLSBURY COOKIE CHALLENGE
I. EXECUTIVE SUMMARY
The case discusses the challenges faced by the Canadian Pillsbury Refrigerated Baked Goods
(RBG); the declining performance (sales) of the cookie line segment has caused the management
to rethink their strategy. The marketing manager is under a lot of stress to come up with a
strategic plan that could help turn around the performance of the cookie segment before a serious
problem takes hold. In order to gain useful insights about consumer attitudes, preferences and
behavior towards their product, Ivan Guillen - the marketing manager, decides to conduct a
market research with the help of consumer insight team. In addition to gaining an in-depth
understanding of consumer preferences and attitudes towards the category, the research was also
aimed at finding out the desired attributes and perceived brand image of the product.
What I analyzed from the case is that the company was focusing too much on the product and
was ignoring the most important variable in the equation – the end consumer. Furthermore, I
believe, they somehow missed a very important target segment – kids as they were targeting
mothers (age 30-40) only. The company needs to redesign their marketing strategy, needs to
come up with powerful ATL and BTL campaigns to attract customers, not to mention the overall
marketing strategy needs to be customer-centric. New products especially made for the Canadian
market should be launched with tailored advertisement campaigns.
II. STATEMENT OF THE PROBLEM
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#1: What are the challenges that Ivan Guillen faces?
The largest international segment of the General Mills Inc; General Mills Canada Corporation
(GMCC) is the market leader in packaged food market. There are four business units in the
Canadian division: snacks, baked goods, meal and breakfast; these business units are in turn
divided into 12 categories and RBG or refrigerated baked goods is one of the most profitable
product categories of GCC.
Challenges Faced by Ivan Guillen
The challenge faced by Ivan is big; he is the marketing manager of the RBG category and he
needs to come up with a solid strategy to turnaround the segment. Over the past 5 years, the
category has experienced only moderate growth. Pillsbury dominates the refrigerated baked
goods category with 85% market share. Representing 62% of the total unit volume (of the
category), cookies are the most profitable SKU’s in the RBG category. Ivan believes that in
order to turnaround the segment’s performance, he needs to focus on growing the refrigerated
cookie segment.
Now the situation is that, this segment is experiencing issues in terms of sales performance; sales
volumes between fiscal 2004-2006 has remained almost flat at 1% and the household penetration
of has also decreased to 24%. In order to design a strategy that works for the segment, he needs
to understand the possible reasons of declining performance of the segment and for that he calls
for a market research to gain useful consumer insights. The primary objectives of the market
research were to find out: if there was an issue with the taste, the brand message, or the target
market.
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Low Brand Budgets in Wrong Target Market
Canada
(Targeting mothers only)
Unsatisfactory Performance RBG
New products leveraged Advertising Campaigns
from the U.S (not tailored for the
Canadian region
MARKETING RESEARCH PROBLEM MANAGEMENT PROBLEM
What are the underlying drivers and motives that drive To design a mind-blowing, consumer-
Canadian customers to buy cookies? centric marketing strategy to turnaround
The research objectives are: the segment’s performance by boosting
To understand the product usage and attitudes of sales volume, increasing household
customers towards RBG cookies
penetration (of the cookies) and to improve
To gain insights about customer preferences
overall growth of the RBG category.
towards the brand and the product
To find out the underlying cause of declining
performance with a focus on figuring out whether
the issue lies in the product formula, the brand
message or the target audience and to find the
differences & similarities in terms of attitudes &
behavior of US and Canadian consumers
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Short-Term vs. Long-Term Problems
SHORT-TERM PROBLEMS LONG-TERM PROBLEMS
Unsatisfactory performance; flat sales volumes Decreasing household penetration
Hence, the short term goal was to improve volume The long-term goal was to improve penetration
growth by redefining the marketing mix of cookies (cookies) and improve the overall growth of the
RBG category (5-7% annual growth)
The market research is done and now Ivan needs to use the findings of the research to design a
strategy that effectively answers all concerns. His focus is on leveraging the research findings to
increase the purchase frequency and market penetration of RBG cookies, to define the target
market, brand message, and how to communicate the message in a way that results in increased
sales.
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III. CAUSES OF THE PROBLEM
#2 what are consumer insights? What type of business challenges can benefit from consumer
insights? How are consumer insights obtained?
Before discussing the causes of the problem in detail, I’ll answer the question on consumer
insights based on what I’ve learned from class lectures. Consumer insight’, in simple words is
the understanding of your customer based on their behaviors, attitudes and preferences. Few
things are as complex as understanding what drives your consumer’s attitudes and behavior and
this is where consumer insights come in. Conducting market research activities to gain useful
information about consumer attitudes and behavior is nothing new. Nevertheless, with changing
demographics, consumer preferences and influx of new businesses, businesses are spending a big
chunk of their marketing budget on market research activities like these. In short, consumer
insight is an in-depth understanding of customer needs and wants and is essentially the
interpretation of their preferences, beliefs and experiences.
Businesses can leverage the power of customer insights by making use of critical information to
address issues related to the performance of their products in the market, before introducing new
products, to obtain feedback about their products and services, and when designing marketing
strategies to make sure they’re aligned with the needs of the customers, to name only a few.
Consumer insights are obtained through market research either conducted by internal marketing
team of a company or a research agency. The research could be qualitative or quantitative and
may include focus groups, in-depth interviews, surveys, product testing/usage, attitude surveys
and KAP studies.
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Ivan engaged the consumer insights team to conduct an in-depth research on consumer
preferences and attitudes because he wanted to understand the underlying causes of the two
major challenges that RBG cookies segment was facing - declining penetration and flat volume
growth. From the case, we know that RBG category is highly dependent on the performance of
their Pillsbury cookies because they constitute more than 60% of their total category sales
volume. However, even though, the category held a leadership position in their sales volume
remained flat at 1% from 2004-06 and the penetration had fallen from 24%.
I believe one of the major causes of the problem is that GMCC despite being an autonomous
division, leveraged new products & advertising campaigns from the US region, primarily due to
high production costs and because of low brand budgets in Canada, ignoring the differences in
consumer taste, attitudes, preferences, and behaviors of Canadian and US consumers. The
research also revealed that there were significant differences between the Canadian and US
customers, which demanded due consideration. Secondly, the company was targeting mothers
aged 30-40, a very narrow target market. The values offered were taste and ease. I believe they
missed out the most profitable target market when defining their target audience – kids and teens
and young people. Furthermore, the value offered also needs modification like rich, luxurious
experience, cherishing good times – something that touches their emotions rather than talking
about the physical attributes of the products only.
#3 Given the key leanings from usage & attitude study, what are the corresponding implications
for what actions the team should take?
The primary objective of the attitude survey was: to gain insights on the product usage behaviors
and attitudes of Canadian customers and to find out the similarities and differences in the
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attitudes, preferences and behaviors of Canadian and US customers. ‘Screeners method’ was
employed by the research agency to screen the participants for the study by asking a set of
questions. Based on their responses they were divided into three main categories:
1. Users - who had bought the Pillsburry cookies during the last 12 months
2. Lapsed users - who had last purchased the Pillsburry cookies about a year ago
3. Non-users - who never bought the RBG cookies (these could be the potential customers)
Key Findings Interpretations Implications
Most Canadian people like GMCC needs to rethink
Compared to baking different things their product proposition
Canada, Scratch from scratch (from the very and focus on offering
Canada vs. US baking is more first step). This could be something like a
market popular in because they either love memorable, luxurious or a
Product Usage (Canada baking or their experience fun-filled baking
Canada – 56%, with alternatives is not experience instead of
good enough to convince talking about ease and
them to use alternatives or convenience.
ready to bake products.
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1Table 1: Purchase Drivers in Canada vs. US
Interpretations Implications
Canada US
The brand is more
The advertising strategy was not
"Like the liked in the US
45% 52% tailored according to the needs &
brand" compared to Canada
preferences of the Canadian market
In addition to advertising strategies,
The flavors offered the company is also leveraging new
"You like the
are also liked in the products from the US, which clearly
flavors that 31% 40%
US more compared to doesn’t meet the unique taste
are offered"
Canada preferences of the Canadian
consumers
In terms of flavor &
experience, the Product leveraging from the US is
Canadian customers doing the company more harm than
"It's similar to
did not like the good. They might be able to save
homemade
31% 36% cookies much and new product development costs but
cookie
only 31% thought by ignoring the preferences & needs
dough"
they were similar to of the Canadian customers, they
homemade cookie were experiencing problems
dough
The brand awareness needs to be
Canadian consumers improved; secondly customer
"For my own
were less connected indulgence factor is missing.
30% 39%
indulgence" with the cookie brand GMCC needs to incorporate both
compared to the US these elements in their ATL and
consumers BTL activities
1
Exhibit 7 – Casestudy
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"Is a high-quality 29% 41% In Canada, the RBG cookies are The brand message should
cookie dough" not considered a quality substitute talk about the nutritional
for baked goods that are made and health benefits of
from scratch cookies
"Makes the right 23% 33% Canadian customers are not Demographic information
amount of cookies" satisfied with the amount of of the Canadian consumers
cookies in the pack including the family size,
meal size etc needs to be
employed
"Helps you create a 19% 24% This value was never emphasized Information regarding
happy/warm home" upon by GMCC and is reflected consumer attitudes and
from the findings as well behaviors is needed to offer
a luxurious, heart-felt
experience to consumers
# 4 Develop perceptual maps for potential targets (users, lapsed users and potential users).What
are the implications from these maps?
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2Table 2: Perceptions of Different User Types in Canada
Findings
Lapsed Non Interpretations Implications
Users
Users Users
Users and lapsed users
both agree to the They’re already
"Is so easy, you convenience and quick promoting
can make them bake attributes offered by convenience offered
92% 86% 58%
in a spur of the the product. More than by the cookies, so
moment" 50% non-users also agree they should continue
with these attributes promoting these
attributes
"Is an easy way
Both users & lapsed
to make cookies 89% 82% 46%
users agree with the
without a mess" In addition to
benefits offered by the
"Is good when I convenience, they
86% 73% 36% RBG cookies. Non-users,
am in a hurry" should also promote
however, weren’t very
"Is easy to clean these benefits that are
83% 82% 45% much convinced about
up" offered by the
these benefits for obvious
"Can be kept in cookies
reasons of course
hand for when 80% 74% 48%
needed"
2
Exhibit 8 – Case study
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Users and non-users both The company can
"For making aren’t much convinced promote the idea of
something 48% 31% 30% that the product could be making special
special" used for making recipes from the
something special product
Both users and lapsed The company can
"There are users agree that there introduce the product
recipes on aren’t any recipes with different recipes
16% 17% 14%
package that I mentioned on the printed on the
use" packages that they could package to improve
use the product appeal
Brand awareness
Both users and lapsed
needs to be
users agree that they
"I use the dough emphasized upon in
don’t use the dough for
in my own 10% 4% 19% addition to
creating their own
recipes" communicating
recipes
product usage to
consumers
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#5 Why did Guillen and his team conduct the in-home and discovery workshops?
While the usage and attitude surveys offered useful insights on major differences between US
and Canadian consumers, these didn’t answer a very important aspect of branding: does the
product experience resonate with most consumers? This information was very crucial for
designing a powerful communication message.
Two research studies; in-home immersions and a discovery workshop were then conducted by
engaging a marketing agency, TerraNova Market Strategies, Inc.
1. In-home immersions – Also known as Ethnographic Research, the primary aim of in-
home immersions to gain an in-depth understanding of consumer actions, motivations
and preference with regard to the product. For the purpose of this research, mothers (the
target market) were asked to buy cookies beforehand and bake them when the research
team visited them. In-home immersions revolve around immersing yourself in the world
of consumers and observing them in their environment. To gain a more realistic, dynamic
view of the consumer and the consumer-brand relationship while getting to know about
other important things like the kitchen type, the cooking rituals etc, in-home immersions
were conducted by Guillen.
2. Discovery Workshops – The discovery workshop is very similar to in-house immersions,
the only difference is that these take place outside the homes of research participants.
Another difference was that these workshops were collaborative in nature and for the
purpose of research 18-27 were invited for a working session. The workshops were
designed to provide a relaxing environment to consumers where they could comfortably
share their experiences, thoughts and opinions about the product. A number of techniques
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were used to help consumers express their honest opinions including role playing,
customer-experience mapping.
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IV. RECOMMENDED SOLUTION, IMPLEMENTATION & JUSTIFICATION
#6 What actions should Guillen and his team take?
I propose the following recommendations:
1. Tailored Marketing Campaigns - GMCC needs to design their own marketing
campaigns and stop leveraging the US campaigns. Campaigns from the US could be used
only when products match the preferences of both markets (US and Canada) and not for
every single product.
2. Consumer-Centric Approach – The marketing campaigns of the company are product-
centric and needs to be changed. It needs to be more consumer-centric.
3. Target Market (Finding New Customer Segments) – The target market needs to be
redefined. They are currently targeting mothers only, they need to include explore other
target markets, such as kids, teens and young people.
4. Promotional Campaigns – The element of fun, interest and entertainment should also be
included in the advertisements for teens and kids. It is a known fact that kids are the main
drivers of purchases by mothers. The element of emotional connection is missing in their
campaigns, which needs to be added. All these elements including ease of use, multi-
purpose, and nutritious should be efficiently communicated through their BTL and ATL
activities.
5. New Products Development – More products need to be offered especially for the
Canadian region, with customized recipes for the market. They can also collaborate with
some cooking show – a sponsored cooking show that promotes the multiple uses of the
product in different recipes.
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The marketing campaign needs to be aimed at:
1. Promoting multiple uses of the product (market development)
2. Reach out to new consumer segments (kids, teens, young people) – (market development)
3. New product development – products designed for the Canadian market keeping their
preferences and needs in consideration.
REFERENCES:
1. Bryman, A. and E. Bell (2003). Business Research Methods. Oxford, Oxford University
Press
2. Sue Greener (2008). Business Research Methods, ISBN 978-87-7681-421-2
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