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Group 2 Kristen, Shelby, Lauren, Elizabeth “KSLE Consulting”
Product Category • Beverage Industry: Coffee • A brewed beverage with distinctaroma and flavor, and comes inmany forms. • Maxwell is owned by Kraft Foods, Inc. • Largest food and beverage company in North America. • Strong brand image and product innovation. • Maxwell House’s current market share = 11%
Background Information A National Coffee Association studyfrom 2012 states that each day: • 40% of 18-24 year olds drink coffee • 54% of adults age 25-39 drink coffee Industry at a glance: • $9.6 billion revenue • $230.1 million profit • $1.5 billion in exports
Competitors J.M. Smucker Company • Folgers • Dunkin’ Donuts Green Mountain Coffee Roasters • Keurig Nestle • Taster’s Choice Starbucks Corporation
Our Failed Product • Ready-to-drink coffee, developed in 1990 • Contained in a 48 oz. carton (which had an interior foil lining) • Made well; fresh ingredients • Sold/stored in refrigerated aisle • Directions said to “Enjoy Hot”
Problems with our Product Packaging, Usage and Unmet Consumer Needs • Could not be microwavedin the original container. • Meant to be hot or cold?
Problem Statement • In order to provide a superior new product that consumers will value, Maxwell House must reinvent the product and change its attributes. • The marketing plan must convey the appropriate message, usage, and benefits of the product.
Main Research Questions • Is hot or iced ready-to-drink coffee more appealing to consumers? • What type of packaging will resonate best with consumers? • What promotional aspects will capture consumers’ attention to make the new product successful?
Research Objective Use consumer responses from our research methods to find attributes that resonate with old and new consumers better than those of the failed product.
Research Methods & Procedures:Focus Group • Exploratory • Qualitative • Convenience sample • 10 participants:6 female, 4 male • Age 20-23 years old
Research Methods & Procedures:Focus Group We also used this opportunity to administer word associations and sentence completions.
Focus Group Findings • Drinking coffee is a daily routine • Convenience is an important attribute • Overall disliking of hot “Instant Coffee” • Our group was more familiar with hot coffee, but didn’t have bad feelings toward iced • Overall, coffee gave consumers happy, calming, and “home” feelings
Our focus group results helped us develop direct and specific survey questions to gain the most accurate insights for the re-launch of our product.
Research Methods & Procedures:Survey • Quantitative • Descriptive • Non-probability • Convenience sample • Snowball sample • 172 participants: 49 male,101 female, 22 no response
Survey • We developed a survey to collect quantitative data, and answer our research questions. • Focused on consumer preferences, purchase intentions, and behaviors • Large sample size, gathered rich data • We directly measured ourresults with SPSS software, leading to statistical analysis.
Hypothesis 1 • IV: Extent of liking iced coffee • DV: Iced coffee purchase intentions • IV: Extent of liking hot coffee • DV: Hot coffee purchase intentions • H0: There is no relationship between likingthe product and purchase intentions • H1: There is a relationship between likingthe product and purchase intentions
Results Correlation • There is a strong, positive relationship betweenliking iced coffee and iced coffee purchase intentions • p < .05, r = .654 • There is a weak, positive relationship between liking hot coffee and hot coffee purchase intentions • p < .05, r = .408
Hypothesis 2 • IV: Package type preferences • DV: Iced coffee purchase intentions • IV: Package color preferences • DV: Iced coffee purchase intentions • H0: There is no relationship between packaging and purchase intentions • H1: There is a relationship betweenpackaging and purchase intentions
Regression for Packaging Individualglass containers Purchase Intentionsfor Iced Coffee Individualaluminum cans Beta = .218 41.5% of the variance Large carton container Beta = .208 Beta = .227
Further Analysis Large Carton Container: t = 3.538, p-value < .05, Beta = .227 • Reject the null hypothesis, in favor of thealternative hypothesis: There is a significant relationship between the large carton packaging container and purchase intentions. • For every one-unit increase in liking this packaging type, willingness to buy a new iced coffee product increases by .227 units (22.7%).
Regression for Color Blue Beta = .102 Red Beta = -.11 Purchase Intentionsfor Iced Coffee Yellow Beta = .081 Beta = .018 Purple 8.9% of the variance Beta = .197 White
Further Analysis White Packaging Color: t = .232, p-value < .05, Beta = .197 • Reject the null hypothesis, in favor of thealternative hypothesis: There is a significant relationship between white packaging color and purchase intentions. • For every one-unit increase in liking the color white for coffee packaging, willingness to buy a new iced coffee product increases by .197 units (19.7%).
Hypothesis 3 • IV: Product name preferences • DV: Iced coffee purchase intentions • H0: There is no relationship between product names and purchase intentions • H1: There is a relationship between product names and purchase intentions
Regression for Name Ready-to-DrinkCoffeeby Maxwell House Beta = .299 Purchase Intentionsfor Iced Coffee Specialty Brewedby Maxwell House Beta = .389 Beta = -.266 20.3% of the variance Fresh n’ Ready by Maxwell House
Further Analysis Specialty Brewed by Maxwell House: t = 2.82, p-value < .05, Beta = .389 • Reject the null hypothesis, in favor of thealternative hypothesis: There is a significant relationship between the name “Specialty Brewed by Maxwell House” and purchase intentions. • For every one-unit increase in liking this name, willingness to buy a new iced coffee product increases by .389 units (38.9%).
Recommendations • Re-launch as a ready-to-drink iced coffee • Package in a large carton container • Use a white primary packaging color, showing a glass of iced coffee • Specialty Brewed by Maxwell House: an endorsed brand
Iced Coffee Specialty Brewed