…
Download
1 / 22

Kingsford Charcoal - PowerPoint PPT Presentation


  • 125 Views
  • Uploaded on

…. Kingsford Charcoal. Daniel Brockman Breanne Klose Elaine Ormonde-Hua Gizem Ozdemir Quyen Tran. http://kingsford.com. Ellsworth B. A. Zwoyer patented charcoal briquettes in 1897* Henry Ford made briquettes from wood scraps in 1920

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about ' Kingsford Charcoal' - jirair


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

Kingsford charcoal

Kingsford Charcoal

Daniel Brockman

Breanne Klose

Elaine Ormonde-Hua

Gizem Ozdemir

Quyen Tran

http://kingsford.com


Kingsford s history

Kingsford's History

Henry Ford, 1919 (Library of Congress, http://en.wikipedia.org/wiki/File:Henry_ford_1919.jpg)

* http://inventors.about.com/od/inventionsalphabet/a/barbecue.htm

2


Kingsford s swot

  • STRENGTHS 

    • Market leader with 59% market share

    • 40% profit margin

    • 60% of consumers consider Kingsford a quality product

    • Strong brand recognition and recall

    • Kingsford has influential relationship with retailers

    • 2-to-1 consumers prefer the taste of charcoal-grilled food to gas-grilled food

  • WEAKNESSES

    • Dependent on positive relationship with retailers for generous store displays and promotions

    • Dependent on weather to encourage impulse buys, which account for 30% of sales

    • Majority of sales occur between May and September

    • Longer cooking time and messier than gas grilling

Kingsford’s SWOT

  • OPPORTUNITIES

    • Build brand equity by being the only active advertiser in the charcoal market

    • Increase market size by expanding to untapped market segments

    • Expand to markets outside of the U.S.

    • Lead the market in product innovations with flavored and environmentally-friendly lines

  • THREATS

    • Gas grilling has become more popular due to faster cooking time and ease of cleanup

    • Competitor price increases and lack of advertising have resulted in slower growth of charcoal sales

    • Production issues may hurt availability if growth occurs

    • Greater attention to human and environmental health

3


Kingsford s questions

Kingsford’s Questions

4

BBQ Sweet Potatoes, John Dawson, http://www.patiodaddiobbq.com/2009/11/barbecued-sweet-potatoes.html


Alternatives potential actions

Alternatives/Potential Actions

Facilitate consumer interest in charcoal grilling

Increase advertising

Expand beyond U.S.

Increase prices

Expand current product line

Do nothing

http://instoresnow.walmart.com/uploadedImages/AmericanSummer/Articles/5051AAP_AS_art_pov_briquet.jpg

5


Criteria for evaluating alternatives

Criteria for Evaluating Alternatives

Tasmanian Salmon, http://www.huonaqua.com.au/grilling.php

6


Analysis facilitate consumer interest in charcoal grilling

  • Collaborate with grill manufacturers

  • Partner with retailers to offer point of purchase

  • discounts on meat purchase with charcoal purchase

  • Sponsor events where grilled foods

  • are for sale

  • Feature charcoal grilling recipes and

  • barbecue party ideas in lifestyle/cooking magazines and television shows

  • Promote charcoal use outside of

  • traditional grilling holidays and occasions

Analysis: Facilitate Consumer Interest in Charcoal Grilling

http://kingsford.com

7


Analysis: Facilitate Consumer Interest in Charcoal Grilling

  • Pros:

    • Emulates Gillette's successful model: Give away the razor and sell the blades

    • Addresses threat of gas grilling by strengthening awareness of charcoal grilling in minds of consumers

    • Fosters positive associations of charcoal grilling

    • Attracts new charcoal users who don't have a grill

  • Cons:

    • Will increased sales justify the cost?

http://cdn.sheknows.com/articles/grilled-corn.jpg

8


Analysis increase advertising

  • Increase volume and frequency of ads

    • $7 million budget recommended during peak season

  • Leverage consumer associations of charcoal grilling as an American pastime

  • Celebrity endorsement

  • Target new segments: women and foodies

  • Pros:

    • Consumers receive greater exposure to charcoal

    • No active charcoal advertising competition

    • Low risk of saturation 

    • Capture increased market share of targeted segments

  • Cons:

    • Stimulated demand may strain production capacity

    • Internal Clorox budget

    • Must take care to avoid alienating existing masculine clientele

  • Analysis: Increase Advertising

    http://kingsford.com

    9


    Analysis expand beyond the u s

    Analysis: Expand Beyond the U.S.

    Target customers outside of the U.S.

    Position product to correspond with local culture in new markets

    Pros:

     Increases size of Kingsford's market

    Cons:

    Production currently limited to 5 U.S.-based plants

    Environmental and health regulations

    of some regions

    Clorox lacks experience outside North America

    Insufficient information of international markets

    www.bbqbrethren.com/forum/showthread.php?t=63394

    10


    Analysis increase prices

    • Maintain 25% to 30% price differential

    • Pros:

      • Higher prices improve profits per

      • unit sold

      • Consistent with charcoal competitors'

      • price increases

      • Enhances brand cachet

    • Cons:

      • When competitors raised prices and Kingsford's prices remained static, sales of Kingsford increased  

      • Competitive advantage of discount brands is weakened when their prices are closer to Kingsford's

      • Retailer might respond negatively and decrease Kingsford promotions 

    Analysis: Increase Prices

    http://dianasneighborhood.files.wordpress.com/

    2009/09/grilling-coals-robert-s-donovan-booleansplit.jpg

    11


    Analysis expand current product line

    • Create flavored and environmentally friendly/healthier

    • lines of charcoal

    • Pros:

      • Allows Kingsford to lead industry

      • in innovation

      • Appeal to growing "green" and

      • health conscious market segments

      • Enhances brand cachet

    • Cons:

      • Increased costs

      • Is there a demand for "green" or health conscious charcoal?

      • Brings attention to environmental and health concerns of existing products

      • Cannibalization of regular charcoal sales

    Analysis: Expand Current Product Line

    http://abcnews.go.com/images/Health/nm

    _Grilled_Food_090515_main.jpg

    12


    Analysis do nothing

  • Pros:

    • No production constraints

    • Free and easy

  •  Cons:

    • Position of charcoal remains stagnant

    • in consumers' minds

    • Slow growth of Kingsford sales

    • Shrinkage of overall charcoal market size

  • Analysis: Do Nothing

    http://farm3.static.flickr.com/2187/2512252584

    _e2d9036049.jpg

    13


    Recommendations

    • Focus on increasing overall charcoal market size

      • Strengthen link of grilling and charcoal in consumers' minds

      • What's good for charcoal is good for Kingsford

    • Increase advertising budget to $7 million

      • Use increased budget to advertise charcoal grilling during nontraditional occasions

      • Present charcoal grilling as female-friendly and essential for premium flavor

    • Do not increase prices

      • Continue to reap benefit of increased competitor prices

    • Research international expansion opportunities

      • Explore viability of expansion

    Recommendations

    http://img4.southernliving.com/i/2006/03/grill-

    with-the-girls/grilling-girls-l.jpg

    14


    Recommendations1

    • 5. In order to appropriately innovate, conduct market research to determine why consumers have switched from charcoal grilling to gas grilling

      • If research determines that environmental and health concerns were primary factors, initiate research and development into product lines to address these concerns

    • 6. With production currently at 80% of capacity, forecast increased sales (given the success of each recommendation) and explore all possibilities for meeting demand

      • Keeping in mind that building a new production facility requires upwards of 5 years and $50 million

    Recommendations

    15

    http://www.masterbuilt.com/kingsford/images/kingsford_08.jpg


    Sources

    Sources research to determine why consumers have switched from charcoal grilling to gas grilling

    Except where noted, all information came from the case description, Narayandas and Wagonfeld, Kingsford Charcoal (2006), Boston, MA, USA: Harvard Business School Publishing. 

    http://www.soudersstudios.com/photos/22_1.jpg

    16


    Questions? research to determine why consumers have switched from charcoal grilling to gas grilling

    http://kingsford.com/

    17


    Production constraints in 2000

    Production constraints in 2000 research to determine why consumers have switched from charcoal grilling to gas grilling

    Current production from 5 U.S. plants

    Kingsford's plants operate at 80% of capacity

    Kingsford's market share is 60%

    100% = 80% * 1.25Current plants could supply a 25% increase in Kingsford sales

    Production manager estimates:

    New plant costs $50M

    Permitting takes 3 years

    Recommendation:

    Begin site selection and permitting

    Next year, reconsider whether to build

    http://s.fatwallet.com/static/attachments/11967_0001_st070209_aap1_img_538277363.jpg

    18


    Bbq grill shipments north america

    BBQ Grill Shipments, North America research to determine why consumers have switched from charcoal grilling to gas grilling

    19

    Hearth, Patio and Barbeque Association (HPBA), https//www.hpba.org/statistics/barbecue-statistics/bbq-grill-shipments


    Demand curve

    Demand Curve research to determine why consumers have switched from charcoal grilling to gas grilling

    When prices of competitors rose in 2000, Kingsford gained market share

    For 1% increase in price relative to competition, Kingsford will lose approximately 4%-points to 8%-points of market share.

    20


    Epilogue

    • Market share: Kingsford sold 74% of charcoal in North America in 2009. (Clorox investors' overview (March 2010) Oakland, CA, USA: The Clorox Company.)

    • Innovation: Kingsford introduced Surefire (R) Grooves enabling faster lighting, hotter and longer burning briquettes. (http://www.kingsford.com/faq/index.htm)

    • Kingsford produces 8 varieties of charcoal

      • 2 "natural"

      • 2 instant

      • 2 regular

      • Specialty hickory and mesquite (http://www.thecloroxcompany.com/products/msds)

    Epilogue

    21


    ad