DALISAY FOOD PRODUCTS, INC.

In 1994 Dalisay Food Products Inc., is faced with the dilemma

of declining sales for its Golden Peanut Butter. Mr. Dennis Garcia,
brand manager of Golden Peanut Butter, is faced with the task of
increasing sales. For he firmly believes that, with the right
marketing strategy employed, Golden Peanut Butter will re-capture
its No. 1 position in the market, a leadership which it maintained
from 1987 1991.
Sales continue to drop from P3.5 million in 1992 to P 2.2
million in 1993. Mr. Garcia attributes sales decline on the
increasing number of peanut butter brands in the market. There are
five competing local brands. Another reason, is the General
Agreement on Tariff and Trade or the GATT Law. This would mean entry
of foreign peanut butter brands in the market competing with the
local brands. In addition, a negative publicity two years ago about
peanut butter being cancerous due to the presence of a substance
called aflatoxin has greatly affected the peanut butter industry
resulting to low sales. And Golden Peanut Butter was not spared from
this publicity.
The Company
For more than 45 years , Dalisay Food Products, Inc. has
successfully launched Golden Peanut Butter in Manila since the late
Japanese era. Golden Peanut Butter is now known and distributed
nationwide. Its success has prompted the company to include jellies
and coco jams in their product line.
Mr. Dennis Garcia was hired to analyze the impact of the
aflatoxin issue. Initial findings showed that indeed, the public
stopped patronizing peanut butter because of fear of acquiring
cancer. However, this was only on a temporary basis according to Mr.
Garcia. He acknowledges that the most difficult task therefore, is
winning back the trust of the public that their product is free from
the cancerous substance. Mr. Garcia has to submit a marketing plan
to the management to be implemented within a year. Before joining
Dalisay Food Products, Inc., Mr. Garcia was a marketing manager in
another company for three years.
The Peanut Butter Industry
The Peanut Butter Industry is a prime segment of the sandwich
spread industry which consists of butter, mayonnaise, margarine,
preserves and cheese. Product usage of sandwich spreads according to
latest as follows:
Product Share in Sandwich Spread Industry
Peanut Butter
23.6%
Mayonnaise
28.7%
Page 1 of 4

Margarine
Butter
Preserves (jellies and jams)
Cheeze

14.3%
15.3%
8.9%
9.2%

The Philippines, an agricultural country, is very abundant in

peanuts. The peanut industry is also a chief source of national
income. The first successful peanut innovation was done in World War
I. Thereon, peanut has become a part of Filipino tradition and
taste. The peanut industry continues to grow due to its varied uses.
Economists project a 7% annual growth in the industry. Due to the
increase in peanut demand, peanut butter producers have been
importing peanuts but this only constitutes 25% of the total
production.
Competition in the industry is very stiff since both local and
imported brands are competing with each other. Current market shares
of peanut butter brands are as follows:
Sweet Nut
Golden Peanut Butter
Dreamland
Yummy
Best Foods
Imported Brands

27.2%
20.8%
23.6%
6.5%
11.3%
10.6%

The Product
Golden Peanut Butter is made from choice, high grade peanuts
with no artificial flavouring and preservatives. It is made with
natural ingredients such as sugar and salt to keep its freshness and
for it to last until eight months in regular weather.
Golden Peanut Butter is packaged in a glass container with
eight different sizes to cater to every need of the consumer. Among
the sizes, the 13 ounces is the most saleable.
Golden Peanut Butter is characterized by its oily and runny
texture the result of the dri roasting process used in peanuts
wherein peanuts are grinded after the dry roasting process to give
the end product the oily texture to make it spreadable.
Golden Peanut Butter is also preferred in taste according to a
recent survey. 52% of the respondents mostly peanut butter lovers
ranging from students to adults prefer Golden than the leading
brand. 62% of the respondents lauded Goldens easy to spread
characteristic.

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The Consumer
Golden Peanut Butter caters to C, D, E households. A large
portion of the market are females who purchase it because of its
taste and that it is ideal for cooking. The price is affordable and
the containers can be used for other purposes after consuming the
peanut butter.
The Untapped Market
Mr. Garcia said its now time to tap the A and B households.
Various efforts have been made by the company to tap the A and
B households by upgrading the product. The glass container have
shapes and designs to make it more attractive. Moreover, new
technology has been incorporated in the cap. Golden Peanut Butter
has a snap cap so it would be easier to open.
Among the peanut butter companies, only Orient Foods Inc. the
makers of Sweet Nut Peanut Butter, has a variety of peanut butter in
the market. This multi branding strategy being implemented by the
Company would ensure that all social classes are tapped.
Price
Brand
Golden
Sweet Nut
Dreamland
Best Foods
Yummy

Size
364 grams
340 grams
364 grams
360 grams
360 grams

Price
P
P
P
P
P

per unit
36.00
55.55
36.00
31.00
39.00

Distribution
Dalisay
Food
Products,
Inc.
supermarkets, 1,000 groceries and
nationwide, mostly in Luzon Region.

supplies
directly
to
300
2,000 sari sari stores

The company has no direct monitoring system in the provinces.

As a result, feedback on how far and to what extent the product is
being marketed is lacking. Inspection of goods is also beyond the
companys discretion when the product is distributed outside Metro
Manila. The company has no direct hand either on how the product is
handled or sold in the provinces.
70% of distributed product consists of Golden Peanut Butter.
The remaining 30% carries the other bread spreads product of the
company.

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Promotion
Advertising budget of Golden is 3% of sales however there has been
no aggressive sales promotions for years. Ad placements are usually
on provincial magazines.

This Marketing Case was written by Ms. Ceres E. Guerrero, a business

student of University of Sto. Tomas.

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