...TruEarth Healthy Food Case Study Introduction to the case Company’s background TrueEarth was founded in 1993 in St.Louis ,Missouri, by Garreth Derosta a young entrepreneur . They offered high processed gourmet (focus on whole grain products offering both 60% and 100% whole grain pastas-cucina Fresca) authentic with great quality . Their product line was: Standard pastas Whole grain pastas Tomato based sauce Refrigerated pastas Pastas with blended ingredient The concept was successful ,and truEarth became a supplier to a number of gourmet groceries throughout the Midwestern United State by 1998 ,the Company had built a loyal regional following .Responding to Customer demand ,the company raised consumer awareness through several promotional programs using coupons ,magazine advertisement ,and in-store demonstrations. Product Development process: In its early years ,truEarth’s product development was informal and largely driven by intuition .the team enjoyed experimenting with new products and limited edition variations on a core recipes and batch process used to manufacture most products made it easy to experiment without affecting overall production. But as time passed the company underestimate the appeal of hit product and find itself struggling to keep up with the demand. The company’ research and development Idea generation Concept searching Product development and testing Qualification of volume About Cucina Fresca The cucina Fresca line was...
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...TruEarth Healthy Foods: Market Research for a New Product Introduction Cucina Fresca is a quick home meal replacement product from TruEarth, an Italian food company which focused on whole grain pasta. Isabel Eckstein, TruEarth brand manager was pondered whether to launch its Pizza kit product as a product line extension of Cucina Fresca and if it worth to launch at what volume would be. TruEarth Experience with Pasta Product - Before launching its product,TruEarth conducted kitchen test which tested to a focused group, organize survey to evaluate interest, and market research to estimates potential sales by Nielsen BASES®. Cucina Fresca pasta market studyfinding that 76% positive purchase intent, comprising those who said they ‘definitely’ or ‘probably’ would buy the product. The industry rule of thumb is that 80% of those who claim they ‘definitely would buy’ and 30% of those who stated ‘probably would buy’ actually completed a purchase. Based on the study, the calculated trial volume was 1.4 MM households, and the calculated repeat volume was 2.3 MM households (assuming excellent product). With that prior kitchen test, survey and research, CucinaFresca Pasta sales which officially launched nationally in the third quarter of 2006 and hadgrown quickly ($18 million in retail sales in 2006 and $35 million in 2007). TruEarth’s Calculation for New Pizza Product: - For the launching of the new Pizza product, we did some calculation regarding data from Nielsen’s research as follow: ...
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...Exhibit 2: Whole Grain Pizza Concept Purchase Volume Estimate, Year 1 (Excellent) Total Purchase Intent Definitely would buy 18.00% % of “Definites” who actually buy 80.00% “Definite” Purchases 14.40 a %Probably would buy 43.00% % of “Probables” who actually buy 30.00% “Probable” Purchases 12.90 b % Trial Rate 27.30 c % Marketing Plan Adjustment Target Households 58,500,000Cucina Fresca Pasta Customers 6,435,000 d Non- Cucina Fresca Pasta Customers 52,065,000 e Customer Awareness 50.00%Non-Customer Awareness 12.00% All Commodity Volume Distribution (ACV) 40.00% Marketing Adjusted Trial Rate Cucina Fresca Pasta Customers Adjusted Trial Rate 5.46 f %Non- Cucina Fresca Pasta Customers Adjusted Trial Rate 1.31 g %Cucina Fresca Pasta Customers Trial Purchases 351,351 h Non- Cucina Fresca Pasta Customers Trial Purchases 682,051.5 i Total Trial Purchases 1,033,402 j,k Repeat Purchase Inputs Repeat Purchase Occasions 2.00 Repeat Rate, by Product Services Excellent Product 49% Repeat Volume, by Product Scenario Excellent Product 1,012,733 l,m Total Purchases 2,046,135 n a Definitely would buy x % of “Definites” who actually buy: 80% x 18% b Probably would buy x % of “Probables” who actually buy: 30% x 43% c “Definite” Purchases + “Probable” Purchases: 14.4% + 12.9% d Target Households x 11%: 58,500,000 x 11% e Target Households x 89%: 58,500,000 x 11% f Trial Rate x Customer Awareness...
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...TruEarth Healthy Foods CASE STUDY 1. Read, reflect on and analyze the company situation within the context of a changing wine industry. 2. Think about an outline all of the external, internal, competitive, market, and consumer factors, changes and trends affecting Mondavi in their business model. 3. Analyze Mondavi on the industry using the tools you now know of, such as SWOT analysis, factor analysis, competitive matrices and Porter's five forces. What are your conclusions about competitive position and options for future growth? To answer: 4. Why was Cucina Fresca pasta successful? First of all, because it’s healthy. Also it’s easy to cook, it’s fast and tasty (in comparison with pasta of another companies). Package has size for one time meal and right proportions of sauce and pasta. Each package has simple instructions for cooking process. For people who care about health and don’t have time to cook – it’s the best option. And on the market only two companies which provide this product. 5. How would you compare the pizza opportunity to that for pasta? I think that here can be two options: huge fail or more or less success. When company launched fresh pasta it was something completely new and thus huge success and large consumption. But pizza is completely different. It’s can’t be healthy food, so people can be interested in it and in case of good taste it can be successful, but with more possibilities it’s not going to be as good as it was with...
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...TruEarth Case Analysis There are various objectives facing the decision maker of TruEarth foods. It is vital to have set objectives before launching a product or even a brand. There needs to be a clear vision of where the company will be in the long and short term, as well as objectives on how TruEarth will run its business and market its products. The main objectives TruEarth needs to focus on are: project objectives, company objectives, personal objectives; long-term versus short term and also the explicitly stated versus implied objectives. The project objective for TruEarth is to successfully find the best way to enter the emerging whole grain pizza market and be the leader in this environment. As the health food industry has continued to boom, TruEarth needs to find the proper way to enter the fresh, healthy, non-frozen pizza market and appeal to those who want pizza, without the pre-existing health risks. As a company, TruEarth focuses their objectives on sustaining their competitive advantage over competitors in the healthy gourmet foods market when entering into the very profitable pizza market. TruEarth’s initial product launch of the Cucina Fresca brand of fresh cut pasta and sauces proved to be successful due to a first mover advantage in a market without a clear leader. The company must now decide what is going to sustain their competitive advantage: attempt to gain the first mover advantage in the pizza market by launching their product as quickly as possible...
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...TruEarth’s dilemma to launch a new pizza product TruEarth, maker of gourmet pastas, sauces and meals, has successfully launched a new product named Cucina Fresco in 2006 and took the first mover advantage in healthy food industry. Although Cucina Fresco led to TruEarth’s great success, it doesn’t promise TruEarth a long-term profit due to intense competition. Truearth has gradually lost its market share to Rifazzi after Rifazzi’s introduction of its whole grain fresh pasta in late 2007. Identifying customers’ needs for healthy food and the market trend based on extensive market research, TruEarth is facing a critical business decision about whether to launch a new product line of whole grain pizza or not while its main competitor Rigazzi also intends to launch a similar product. Launching whole grain pizza might help TruEarth to expand its product diversity and retain its position in whole grain products; however, besides the threat posed by Rigazzi, the presence of existing strong competitors such as Kraft and Nestle and consumers’ perception of healthy value of pizza also put TruEarth at a disadvantage. Success of Cucina Fresca pasta TruEarth was the first company that identified the opportunity for healthy gourmet products and developed products that met customers’ needs. As the trend of having a healthier diet grows, Cucina Fresca offers not only fresh pasta and sauce with healthy ingredients as home meal replacements but also a better taste than dry, shelf-stable pasta...
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...radical. They believe in healthy eating, taste conscious and concerned about what they eat. The tribe members are family loving, educated professionals with very disciplined lifestyle. Salubrious Cognizant Moms are very busy professionals but insisted on eating at home and cook their food to their taste and were conscious about ingredients in the food being consumed by their family. The culture-based characteristics of the Salubrious Cognizant Moms include moderate to high power distance with conservative behaviours. Among these families women usually makes grocery decision and checks the price, ingredients and nutrition value for everything they buy. Due to school going children in the family taste is of paramount importance. The members of Salubrious Cognizant Moms passionately demonstrate family orientation, health consciousness and will carry that in all walks of their lives from workplace to home. They are generally women but there are exceptions where male head of the family goes for groceries and makes buying decision. They have very high uncertainty avoidance values and are not comfortable with uncertainty they seek better value proposition with optimized price, value and nutrition values. Salubrious Cognizant Moms members are smart and realistic with long-term orientation values. Health foods skew to an older and/or more upscale audience. The 40-plus market has been described as a “growing segment of the population looking for healthy, low-cal foods.” With increasing age...
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...Purpose of this research paper is to find out if company need to launch production of whole grain pizza and to come up with semi-comprehensive marketing plan for this new product. Along with marketing plan we will provide market analysis that shows benefit of launch new product, define our target market and create value for the product. Market Analysis The business situation of TruEarth Healthy Foods Company is it faces two challenges now, one is from competitor and another is from itself. Firstly, TruEarth was good at produce Cucina Fresca - a kind of whole grain pasta meal. The revenue was $23 million by the end of 2007. However, growth had slowed in 2008 as competitor (Rigazzi) began offering similar products. Secondly, the Truearth faces a threat that is it only produces one kind of product. If Truearth cannot keep advantage in the market of whole grain pasta, then the company will be in a very disadvantageous position. Our purpose in this case is to help TruEarth to launch a product and provide a marketing plan. The whole grain pizza is a potential product that TruEarth is considering to launch in the future. Based on the pasta’s data, we can get the trial rate of pizza is 27.3 %(definitely would buy 18% times actually buy 80% plus probably would buy 43% times actually buy 30%). Customers Awareness is 16.2%(11% tried product times 50% customer awareness plus 89% un-tried product times 12% non-customer awareness). So the Marketing adjusted trial rate equal to...
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...1-800-545-7685, write Harvard Business Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. V. KASTURI RANGAN SUNRU YONG TruEarth Healthy Foods: Market Research for a New Product Introduction Isabel Eckstein strode toward her office, inhaling the aroma from the test kitchen where the product development team was trying new recipes for TruEarth, maker of gourmet pastas, sauces, and meals. Her team had been working hard for the past year on a fresh whole grain pizza. The final market research results had arrived, and it was time to make a decision on launching the product. In 2006, Eckstein, a brand manager, had led the introduction of Cucina Fresca, a fresh whole grain pasta meal kit sold through supermarkets. By the end of 2007, sales had reached $23 million, making it the most successful product launch in company history. However, growth had slowed in 2008 as competitors began offering similar products. Sustaining a competitive edge in the fresh Italian food category required continual innovation and, as a result, TruEarth had invested heavily...
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...4065 DECEMBER 24, 2009 V. KASTURI RANGAN SUNRU YONG TruEarth Healthy Foods: Market Research for a New Product Introduction Isabel Eckstein strode toward her office, inhaling the aroma from the test kitchen where the product development team was trying new recipes for TruEarth, maker of gourmet pastas, sauces, and meals. Her team had been working hard for the past year on a fresh whole grain pizza. The final market research results had arrived, and it was time to make a decision on launching the product. In 2006, Eckstein, a brand manager, had led the introduction of Cucina Fresca, a fresh whole grain pasta meal kit sold through supermarkets. By the end of 2007, sales had reached $23 million, making it the most successful product launch in company history. However, growth had slowed in 2008 as competitors began offering similar products. Sustaining a competitive edge in the fresh Italian food category required continual innovation and, as a result, TruEarth had invested heavily in its pizza offering. Eckstein observed: We were aggressive in launching Cucina Fresca. We made a significant investment in new manufacturing equipment and the distribution infrastructure required to get fresh food to shelves quickly. Being a small company competing against Nestle and Kraft is not easy, but we do not make rash decisions. The success of Cucina Fresca was a calculated risk based on significant research. We think we can achieve similar success with pizza, but we will...
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... PROBLEM STATEMENT TruEarth has developed a frozen pizza product, but the brand manager and other executives are struggling with the decision to launch the product or not. Poor forecasting in the past has lead TruEarth to misstep with previous product launches; judging the correct volume will be critical. The team is aware that their rival, Rigazzi, has also tested a pizza concept and is not far from a product launch. EXECUTIVE SUMMARY The ready-‐made or semi-‐made meals market is mature, now reaching the late majority segment of the product life cycle. A segment of the ready made foods market is shifting away from mass produced, highly processed foods toward greater quality and authenticity. TruEarth has managed to differentiate itself and its products by targeting this niche, a segment of ready-‐made foods that is still experiencing sustainable growth. TruEarth is on the offensive...
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...TRUEARTH HEALTHY FOODS (CASE STUDY SNLYSIS) COMPANY BACKGROUND TRUEARTH was founded in 1993 in st Louis, missori by Gerath Derosa a young entrepreneur and its is providing quality healthy and authentic pastas.DeRosa sourced a particularly high quality durum wheat from North Dakota and was notriosly selective about ingredients for sauce. The product line featured standards pastas such as speghatis,rigatoni and shells and specialty pastas with blended ingredients such as artichoke spinach and saffron.truearth is driven by innovative free willing and entrepreneurial spirits.truearth introduced a 60% as well as 100% whole grain pasta cucina fresca which was a great success. ABOUT CUCINA FRESCA PASTA Cucina Fresca pasta is launched in 2006 with a full range of choices cut pasta, tortalinni, and ravioli as well as accompanying by different sauces as shown in the exhibit 1 of the case. The FRESCA product was designed to be consumed in a single meal for two tapped the growing demand for healthy HMR efficiently. The cucina Fresca product are quick and easy. There is no guesswork for the consumer. The packaging of each product recommends the best sauce option. The cucina fresca line was rolled out nationally in the third quarter of 2006 it grew quickly with $18 million retail sales in 2006 and $35 million in 2007. Competitive threats There is one strong competitor in the market named Rigazzi brand which introduced his own pasta in late 2007.Rigazzi targeted TruEarth...
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...Case Study TruEarth By Michele McKimmy Marylhurst University July 5, 2012 Professor S Abstract In the fight for competitive market share it is important for a company to bring new product to the market. TruEarth Healthy Foods, a maker of 100% whole grained gourmet Italian meals achieving great success with Cucina Fresco pasta, observed a decline in market share due to competitors offering like products. The company looking for new venues looked into launching a new fresh made pizza line in order to be competitive with its leading competitor as well as subsequent companies with a lower grade product such as Kraft and Nestle. TruEarh took great care in their research and development of the new product leading to analyzing the value and success of launching the pizza product line. Case Study TruEarth Case Questions: Keep in mind... what is the market need? How was the market segmented and what trends influenced the segmentation? 1. Why was Cucina Fresca pasta successful? How would you compare the pizza opportunity to that for pasta? How would you compare the actual product development process for each? 2. Using the forecast model for pasta shown in Exhibit #5, what is your forecast of the demand for pizza? Hints: the necessary data is contained in Table B and Exhibit 7. There is a significant difference in the "likeliness to buy" results for past TruEarth customers and non-customers. Actual penetration of the Cucina Fresca parent brand may range from...
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...market penetration (5% to 15%), the following forecast was obtained: 3. What can the team at Tru-Earth learn from Exhibit 6 about their customers preferences? Exhibit 6 shows the results of a survey based on attributes and substitution of the pizza category. The survey is based on a 10-point scale, where 1 is the lowest score and 10 is the highest score. Regarding to the usage attributes, the average respondent considers pizza to be "family oriented" due to the fact of the high ratings of all categories (take-out pizza with 8.9 out of 10 points, refrigerated pizza with 7.1 points, and TruEarth new concept with 8.6 points). Therefore, under the assumption that the typical family size starts with 2 people and then increase, the pizza kit size is properly oriented (servings for 2 to 3 people). However, average respondents also considers convenience is as a major attribute, and TruEarth pizza scores lower than take-out pizza and equals refrigerated pizza, since customers will need time to prepare the meal instead of just picking it up or ordering for delivery....
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...from processed food to healthier options. Cucina Fresca fulfilled this demand. It was prepared from more fresh and superior ingredients and was destitute of “bad carbohydrates”. * The consumers wanted more whole grain in their intake. Cucina Fresca being whole grain pasta conformed to this parameter. * Cucina Fresca fitted the category of “semi-prepared”, “ready to eat” products which were in high demand by time deprived, dual income households. * The product line was varied and was perceived more tasty and healthy than competition. * Demand for refrigerated fresh pastas was growing faster than dry pastas. * The size of the package had the right portion of pasta and sauce making it convenient to cook. * TruEarth enjoyed the first mover advantage in market. * Cooking the pasta was quick and easy. Each package recommended the best sauce option. The consumer did not have to do any guess work. * The package came with instructions to customize the meal if desired, like add grilled chicken or shrimp. Pizza vs. Pasta: Opportunity- | Pizza | Pasta | Market size | $5.8 B | $4.4 B | Customer perspective | Indulgence | Meal | Source of extra revenue | Customer may purchase multiple toppings | Customer will purchase only one sauce for one packet of pasta | Competition | Local pizzerias, National and international chains, Kraft, Nestle | Rigazzi | First mover advantage | Rigazzi was developing a similar concept. So if TruEarth does not act...
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