BPMM6013 MARKETING MANAGEMENT

Brannigan Foods: Strategic Marketing Planning

Group Members:
Kamalanathan Perisamy 820330
Rajendiraperasad Muniam 820309
Shubashini Mathyalingam 820283
Lilambikha Raja Vikraman Varman 820275

Overview

Characters: Bert Clark (Vice President & General Manager)

Srikant Thipa (Director of Simple Meal Unit)
Claire Mackey, (Director of Finance and Planning)
Anna Chong (Chief Innovation Officer)
Bob Pugh (Director of Sales & Marketing)

Introduction
Brannigan Foods Soup Division - 40% of the firms
revenue.
Steady decline (3 years) - divisions of sales, market share,
and profitability
Reverse the decline - increase the growth back to 3-4%.
Each Managers suggest different plan
1. Investing in the growing sectors
2. Acquiring product lines,
3. Investing in organic growth,
4. Invest in the core

Situational Analysis

5 Cs Analysis
COMPANY
100 year legacy
RTE(71%), Dry Soups, Healthy Soups, Fast and simple
meals
Cash cow- 40% of total sales
Acquiring & integrating Anabelles products into
Brannigans product line
Increasing market share by brand awareness

COMPETITOR
Major competitors - General Mills
Small competitors - Roaring Cajun Food
- Red Dragon Food
- Brothers Gourmet
Other competitors - Private labelled soups which
increases the sales to 5%
Less shelf space for Brannigan products

CUSTOMER
Current market: Baby boomers
Targeted group: Young generation, young & working
mothers
Trends: Innovation of new flavours
Quick meals and healthier product or food

COLLABORATORS
Decrease of 3% in Brannigans Shelf Space
Must ensure that retailer goodwill doesnt fall
Retailers would appreciate price cuts that may boost
sales
Supermarkets sold 62.9% of the category

CONTEXT
Micro: 1) Political and regulations environment
2) Economics environment
3) Social and cultural environment
4) Technological environment
Baby boomers generation is becoming older
Society, trend, fashion: Healthy eating and prevent
obesity trends
Technology environment: Food R&D for healthier and
active lifestyles

SWOT Analysis

STRENGTH
-100 years in line: market leader in high
market share
- high brand awareness with 14% of
sales
-RTE soups are still considered as staple
food in the United States

OPPORTUNITY
-New product innovation to increase
sales
-Liaise with retailers to generate
continuous solution to obtain a win-win
situation

WEAKNESS
-Sales decline in past 3 years
-Failure in identifying society behavior
and trend
-No integration between teams( Finance,
Marketing& Sales, R&D, Simple Meal
Unit) due to lack of communication

THREAT
-Private labelled products grows, which
reduces Brannigans shelf space
availability
-New product from various competitors
-Gap between product offered and
consumer needs

Objective
To increase the profit and market share back to 3-4%

Attract new customer & increase customer lifecycle of the brand

Enhance existing product with innovative healthy concept

Suggestion

1. Invest in Growing Sectors

Reinforce former strategy but increase investments in the dry soup, fast meal and healthier soups
category.
PROS:
Categories demand is growing supported by trend towards fast but healthy meals
Canned soup category is declining
Potential rapid market share growth due to retailer and consumer market strength
Focused on long term growth
CONS:

Categories are not nearly as large as the canned soups category

Strong competition in the segments
Branningan Foods is behind due to competitors first mover advantages

Earning Projection as per Tiphas

recommendation (in $ million)
Year

2011

2012

2013 Forecast

2013 Tipha

Net Sales of Brannigan Food WW

7330

7979

8230

8230

Net sales of US Subdivision

3034

2973

2913

2954

Cost of Good Sold

1669

1635

1602

1625

Marketing, R&D and Selling Expenses

425

416

408

426

Other Expenses

625

627

600

620

Net Earning

315

295

303

283

189

178

178

188*

Less:

Broken out marketing and selling expenses

Advertising and Promotion

With this strategy Brannigans Net earning wouldn't increase, but will reduce by 4%

2. Acquire product lines to complement the core

in growing sectors
Healthier and convenient segments that have new flavors
PROs:
Acquisitions represent being present in the new flavour & healthier category
Potential market share growth due to retailer and consumer market strength
Potential increase in sales around 1.5-3.5% to sales within 5 years
House of brands? Advantage- get more self space, different brands.
CONs:
Healthy & Asian category demands could also be targeted by using existing lines
Cannibalization on existing lines (0.3-0.6%)
Branningan would have to take on debt
Breakeven might be later than expected

Earning Projection as per Claire Mackey

recommendation (in $ million)
Year
Net Sales of Brannigan Food WW
Net Sales of US Subdivision
Less:
Cost of Good Sold
Marketing, R&D and selling expenses
Other Expenses
Net Earning
Broken out of marketing and selling
expenses

2011
7330
3034

2012
7979
2973

2013
8230
2913

2014

2015

2016

2856

2799

2743

1669
425
625
315

1635
416
627
295

1602
408
600
311

1570
422
600
273

1539
422
588
260

1509
423
576
247

Advertising and Promotion

189

178

184

184

184

185

This strategy isnt profitable either since Brannigan s net earning decreasing by average 7% per year

3. Invest in organic growth from internally

developed new products
To milk the cash cows and subsidize the investment of the star products
New flavors, Innovative packages & New usages
PROs:
Brannigans Traditional strengths are reinforced (new products build on Brannigans most popular
soups).
Consumers changing needs would be addressed and consumer desire for innovation in the category
could be served.
CONs:
Cannibalization on existing lines due to 90% chance of Brannigan having to take out core product
to place product in shelf.
Increasing intolerance of retailers to bring in products with short-term life-cycles failing to meet
sales and profit expectations, possible stocking fees, returns etc (apprx. $1000 per failed product)

Earning Projection as per Anna Chong

recommendation (in $ million)
Year
Net Sales of Brannigan Food WW

2011
7330

2012
7979

2013
8230

2014

2015

Net Sales of US Subdivision

3034

2973

2913

2856

2799

Cost of Good Sold

1669

1635

1602

1570

1539

Marketing, R&D and selling expenses

425

416

427

423

419

Other Expenses

625

627

612

600

588

Net Earning

315

295

287

287

281

189

178

189

185

181

Less:

Broken out of marketing and selling expenses

Advertising and Promotion

With this alternative, Brannigans net profit wouldnt increase but instead decrease 2% on
average per year

4. Invest in the Core

+ $20MM marketing to increase brand awareness. Decrease prices of the Ready to Eat soups by 5
cents
PROs:
Decline in operating income can be stopped while sales volume and recapture of market share could
be increased
Favorable in retailers view due to increased sales expectations
CONs:
Uncertainty about possibly higher sales
Cutting price might lower the perceived value of Brannigan products

Earning Projection as per Bob Pugh

recommendation (in $ million)
Year

2011

2012

2013

2014

2015

Net Sales of Brannigan Food WW

7330

7979

8230

Net Sales of US Subdivision

3034

2973

3211

3398

3596

Cost of Good Sold

1669

1635

1766

1869

1978

Marketing, R&D and selling expenses

425

416

447

447

447

Other Expenses

625

627

642

714

755

Net Earning

315

295

356

369

416

189

178

209

209

209

Less:

Broken out of marketing and selling expenses

Advertising and Promotion

In this case, this alternative seems profitable; Brannigans earning will be increase during the
next 3 years

Option 3
-The leader position in the market
obliges Brannigan to invest in R&D due
to the changing trends and needs of the
market.
-to invest in marketing to make the RTE
soups strong in the market.

Option 4
-reinforce the cash cow of the
division which are the Ready to Eat
Soups.
-keep financing the question mark
products, which will become stars
and future cash cows with the way
the market is growing.

This mix of both strategies certifies the companys short term goals and envisions long-term profits with the
investment made, since it stretches the life cycle of the RTE soups and boosts growth in the early stages of the new
products life cycles.

Implementation

Increase R&D budget from $14M to $19M to develop prototypes

Invest heavily in Marketing testing and launch new products
Launch Deluxe Gourmet Deli line with few flavors
Launch Dry Soup line with Advertising few flavors
Raise Retailer margin for new lines by 5% to gain shelf space for new products
Invest in Heart Healthy Promotion

Marketing Mix

4 Ps
PRODUCT
Implementation of Umbrella brand of Brannigans
soups division which gives emotional values to the
products and brands targeted different market
segment
Various product range that provides various
benefits
Positioning Statement:

For people who enjoy health, easy to cook, Savoury

food, Brannigans soup is a brand of soups that offers
convenient varied, trustworthy and very good quality
soups that loves customers to enjoy meals while taking
care of their health and to save time at very competitive
prices based on its experience as leader in the category
and its innovative products.

PLACE
Distribution are major concern
Entries of private labelled soups with constant
growth of 5% due to price increase
3% shelf space reduced

PRICE
Maintain the price of RTE soups
Tag higher price for Deli soups, this will create a
Compromise Effect to consumers by building an
impression of high quality products
Shift consumers preference by giving superiority
of Deli soup.

PROMOTION
-Pull strategy is used on Mass Media and Digital for
discounts, offers and promotions
-Sales Force:
:- must be reorganized to increase 4% sales earnings
per year
1) A 20-80 division( 20% farmers-80% hunters) to
increase the search and acquisition of new retail
partners
Salaries:
1) Mix of fixed and increased percentage of the
variable part
2) Sales force teams will be given bonuses if they
meet and surpass the sales objective of the year

MARKET
Fragmentation and growing new trends
has caused a change in the strategy

MEDIA
TV ad and social media

MISSION
Reposition the brand as an innovation
company that owns the leadership by
increasing the life quality of its
consumers.

MONEY
$170 million budget for marketing expenses
of year 2013

MEASUREMENT
Digital marketing impacts

MESSAGE
Create emotional value

Objective

Increase Sales
Engage Consumers
Offer Value
Improve Brand Image

Conclusion
If investment is done in core segments of Brannigan Foods as suggested by Bob Pugh, net
earnings increase up to 399 million or 3.05% growth year on year. The sales would increase
up to 3186 million by 2014.
Being market leader in Ready to Eat (RTE) segment Brannigan should look forward to
maximize profit on maturing product.
Clark also has to decide on a long term strategy. Look to cater to customer preferences by
developing new products internally.
Additional expenditure of around 5 million in R & D and also additional promotional costs for
the new products, the costs can be met by the increased profits due to the increased investment
in the core products.
This would also reinforce Brannigans image as an innovator and help increase its brand equity
among customers. As such, Clark would need to adopt both Option 3 and Option 4 to
successfully satisfy all of his decision criteria.

Thank You