REPOSITIONING CHEETOS IN INDIAN MARKET

OUTLINE:
PRIMARY DATA Analysis of qualitative and quantitative results. Final consumption & suggestions: Map results from primary research to study of secondary data , try to plug the gaps. Strategies can be used for repositioning Cheetos . SECONDARY DATA Current position of cheetos in market . Also , mapping in various matrices like BCG matrix etc . Competitors direct and indirect . Segmenting , targeting & positioning. Role of marketing communication / advertisement . International success of cheetos - reason Learnings for Indian market .

RESULT : mapping the result on the graph in 3 stages : Pre consumption While consumption Post consumption

About cheetos History :

Cheetos (formerly called Chee-tos until 1998) is a brand of cheese-flavored, puffed cornmeal snack made by Frito-Lay, a subsidiary of PepsiCo. Fritos creator Charles Elmer Doolin invented Cheetos in 1948, and began national distribution in the U.S. The initial success of Cheetos was a contributing factor to the merger between The Frito Company and H.W. Lay & Company in 1961 to form Frito-Lay. In 1965 Frito-Lay became a subsidiary of The Pepsi-Cola Company, forming PepsiCo, the current owner of the Cheetos brand.

In 2010, Cheetos was ranked as the top selling brand of cheese puffs in its primary market of the United States; worldwide the annual retail sales totaled approximately $4 billion. The original Crunchy Cheetos are still in production but the product line has since expanded to include 21 different types of Cheetos in North America alone. As Cheetos are sold in more than 36 countries, the flavor and composition is often varied to match regional taste and cultural preferencessuch as Savory American Cream in China, and Strawberry Cheetos in Japan.

Cheetos performance in India over the years..

Cheetos performance in international market : Current position of cheetos in India Current position of cheetos in international market: Competitors of cheetos in India direct Competitors of cheetos in India indirect

Objective : to study the performance of cheetos and help its repositioning it Indian market . Scope :

Profile of cheetos :
Cheetos (formerly called Chee-tos until 1998) is a brand of cheese-flavored, puffed cornmeal snack made by Frito-Lay, a subsidiary of PepsiCo. Fritos creator Charles Elmer Doolin invented Cheetos in 1948, and began national distribution in the U.S. The initial success of Cheetos was a contributing factor to the merger between The Frito Company and H.W. Lay & Company in 1961 to form Frito-Lay. In 1965 FritoLay became a subsidiary of The Pepsi-Cola Company, forming PepsiCo, the current owner of the Cheetos brand. In 2010, Cheetos was ranked as the top selling brand of cheese puffs in its primary market of the United States; worldwide the annual retail sales totaled approximately $4 billion. The original Crunchy Cheetos are still in production but the product line has since expanded to include 21 different types of Cheetos in North America alone. As Cheetos are sold in more than 36 countries, the flavor and composition is often varied to match regional taste and cultural preferencessuch as Savory American Cream in China, and Strawberry Cheetos in Japan.

HISTORY :
Cheetos were invented in the 1940s by Fritos creator Charles Elmer Doolin, who cooked early test batches in the Frito Company's Dallas, Texas-based research and development kitchen. The cheeseflavored snack sold quickly, but Doolin did not have the production or distribution capacity to support a nationwide launch. This led Doolin to partner with potato chip businessman Herman W. Lay for marketing and distribution, and Cheetos were introduced nationally in the U.S. in 1948 along with a potato product called Fritatos. The success of Cheetos prompted Doolin and Lay to merge their two companies in 1961, forming Frito-Lay Inc. At the time, Cheetos was one of four large snack food brands produced by the company, which had annual revenues of $127 million.Frito-Lay merged with the PepsiCola Company to form PepsiCo in 1965, prompting further distribution of Cheetos outside of North America. While Cheetos was the first snack food of its kind, competing products in the snack food category have since emergedincluding Utz Cheese Curls, Herr's Cheese Curls and Wise Cheez Doodles. Most of the competing cheese-flavored snacks are distributed in specific regions of the U.S., and as of 2010 Cheetos remains as the top-selling cheese puff in America. As of 2011, Cheetos are produced, marketed and distributed under three different PepsiCo operating divisions: PepsiCo Americas Foods (which includes Frito-Lay in the United States and Canada, Sabritas in Mexico and Latin Americas Foods in Brazil, Colombia, Argentina, Venezuela and Peru.), PepsiCo Europe and PepsiCo Asia, Middle East & Africa. In 2010, worldwide annual sales of Cheetos totaled approximately $4 billion, making it the 11th-largest PepsiCo brand.

PRODUCTION AND DISTRIBUTION :

The first Cheetos product was Crunchy Cheetos, invented in 1948 in San Antonio, Texas. Crunchy Cheetos remained the brand's sole product for 23 years until the introduction of Cheetos Puffs in 1971. The baked varieties, otherwise known as Baked Cheetos, became available beginning in 2004. As of 2010, there are 21 different variants of Cheetos snacks distributed in the United States. In addition to the original Crunchy Cheetos, Cheetos Puffs and Baked varieties are sold in alternate shape and flavor variationsincluding a spicy variety known as Flamin' Hot Cheetos. With the introduction of Frito-Lay's Natural Line, Cheetos Natural were introduced in the mid-2000s, with all natural ingredients, and natural, and real Wisconsin white cheddar, Cheetos Natural are unique for Cheetos. They accompany others in the Natural line, and are a direct competitor to other natural competitors, such as Pirate's Booty. Cheetos first entered Brazil in 1976, followed by other countries such as Australia during the 1980s In 1994, Cheetos became the first American brand of snack food to be made and distributed in China. As the distribution of Cheetos expanded outside the U.S. to include more than 36 different countries, localized versions were produced to conform to regional tastes and cultural preferences. Frito-Lay conducted extensive testing before settling on flavors for the Chinese market, with ranch dressing, North Sea crab, smoked octopus and caramel being passed up for two flavors: Savory American Cream and Zesty Japanese Steak. These flavors were produced as the result of focus group testing, in which the original Crunchy Cheetos did not test as well. Strawberry Cheetos, a variation of the original Crunchy Cheetos dipped in a flavored icing, are produced and distributed in Japan. In India, Cheetos Whoosh are sold, made of ingredients such as whole grain and vegetables. The sole Cheetos product produced in Australia is Cheetos Cheese & Bacon Balls.

Current Variations(Globally):
Crunchy Cheetos (1948) Cheetos Puffs (1971) Flamin' Hot Cheetos (1992) Flamin' Hot Cheetos Puffs (1999) Flamin' Hot Cheetos con Limon (2002) Cheetos Twists (2002) Baked Cheetos (2004) Flamin' Hot Baked Cheetos (2006) Cheddar Jalapeo Cheetos (2007)

Xxxtra Flamin' Hot Cheetos (2008) Salsa con Queso Cheetos (2012) Honey BBQ Cheetos Puffs (2012) Cheetos Mix Ups Salsa Mix (2013) Cheetos Mix Ups Xtra Cheesy Mix (2013) Crunchy Cheetos Tapato (2013)

Discontinued Variations:
Cheetos Paws (1990-1993) Cheetos Cheesey Checkers (1995-1998) Crunchy Nacho Cheetos (1996-1997) Cheetos Zig-Zags (1998-2002) Cheetos X's and O's (1999-2000) Cheetos Pizza Puffs (2001-2006) Cheetos Super Flamin Hot(2013)

Manufacturing
Main article: Cheese puffs Cheetos are manufactured by blending corn and water. The mixture is heated under pressure, and then extruded through a die. The texture of the snack is formed as a result of contact with hot air, causing steam in the mixture to expand and creating its characteristic texture. After oven-drying or frying, the product is then tumbled with the desired flavor components (the original Crunchy Cheetos are fried). The process takes approximately 19 minutes and each half hour an in-house lab team inspects and taste-tests each batch. At this point, the result of the inspection is determined by comparing each batch to product sent from Frito-Lay headquarters. Other flavor and format variations such as Cheetos Puffs, Cheetos Paws, Cheetos Twists, Cheetos Balls, and Cheetos Whirls are all finished with a drying stage in large ovens. As of 2010, Frito-Lay has 14 fried-Cheetos plants in 11 states throughout the United States.

Promotion and mascot Chester Cheetah

The Cheetos brand is commonly recognized by association with its mascot, an anthropomorphic cartoon cheetah named Chester Cheetah. Chester first appeared in television commercials in 1983 as an animated cartoon character, adopting a sly, smooth-voiced personality. This character became the focus of more Cheetos commercials, eventually becoming the brand's official mascot. Chester has become known for

concluding Cheetos advertisements with slogans, which have evolved over time. Chester was preceded by an earlier mascotthe Cheetos Mouse, which debuted in 1971 using the slogans Cheese that goes crunch and "Hail Chee-sar!". The slogan "it ain't easy bein' cheesy" was used in the late 1980s and early 1990s, followed once again by the cheese that goes crunch until 1996, when it became Dangerously cheesy. In the early 2000s, Chester was first rendered as a computer-generated character in the United States; while continuing to appear in an animated form in some other countries where the brand is sold. Beginning in 2008, Cheetos advertising and promotion broadened in regards to age appeal, with a revised focus on an adult demographic. In this personification, Chester speaks with a mid-Atlantic accent and encourages people to use their Cheetos in acts of revenge or to solve problems. In February 2009, Cheetos was the subject of its first Super Bowl commercial. In the $3 million, 30 second advertisement, a "loud, chatty woman" is talking on her mobile phone at a restaurant. Chester the Cheetah persuades another customer to toss Cheetos onto the ground, attracting a flock of birds to drive away the obnoxious loudtalking customer. The scenario depicted in this commercial exemplifies the adult-oriented themes of subversion and revenge, which continue to be prevalent in Cheetos advertisements produced since 2008.

In popular culture
Cheetos have been the subject of public and media attention on multiple occasions due to the unpredictable shapes that form during the manufacturing process. Cheetos have been found in shapes which resembled the appearance of popular or historical figures. A single Cheeto described as being in the shape of Michael Jackson doing the Moonwalk Dance sold for $35.18 on eBay in the summer of 2009, attracting national media coverage in the U.S. A couple who found a Cheetos snack in a shape they described as resembling Jesus Christ nicknamed it "Cheesus" and garnered media attention as a result of their consideration of selling on eBay.

Bcg matrix :

Boston Consulting Group (BCG) Matrix is a four celled matrix (a 2 * 2 matrix) developed by BCG, USA. It is the most renowned corporate portfolio analysis tool. It provides a graphic representation for an organization to examine different businesses in its portfolio on the basis of their related market share and industry growth rates. It is a two dimensional analysis on management of SBUs (Strategic Business Units). In other words, it is a comparative analysis of business potential and the evaluation of environment. According to this matrix, business could be classified as high or low according to their industry growth rate and relative market share. Relative Market Share = SBU Sales this year leading competitors sales this year.

Market Growth Rate = Industry sales this year - Industry Sales last year. The analysis requires that both measures be calculated for each SBU. The dimension of business strength, relative market share, will measure comparative advantage indicated by market dominance. The key theory underlying this is existence of an experience curve and that market share is achieved due to overall cost leadership. BCG matrix has four cells, with the horizontal axis representing relative market share and the vertical axis denoting market growth rate. The mid-point of relative market share is set at 1.0. if all the SBUs are in same industry, the average growth rate of the industry is used. While, if all the SBUs are located in different industries, then the mid-point is set at the growth rate for the economy. Resources are allocated to the business units according to their situation on the grid. The four cells of this matrix have been called as stars, cash cows, question marks and dogs. Each of these cells represents a particular type of business.

10 x Figure: BCG Matrix

1x

0.1 x

1. Stars- Stars represent business units having large market share in a fast growing industry. They may generate cash but because of fast growing market, stars require huge investments to maintain their lead. Net cash flow is usually modest. SBUs located in this cell are attractive as they are located in a robust industry and these business units are highly competitive in the

industry. If successful, a star will become a cash cow when the industry matures. 2. Cash Cows- Cash Cows represents business units having a large market share in a mature, slow growing industry. Cash cows require little investment and generate cash that can be utilized for investment in other business units. These SBUs are the corporations key source of cash, and are specifically the core business. They are the base of an organization. These businesses usually follow stability strategies. When cash cows loose their appeal and move towards deterioration, then a retrenchment policy may be pursued. 3. Question Marks- Question marks represent business units having low relative market share and located in a high growth industry. They require huge amount of cash to maintain or gain market share. They require attention to determine if the venture can be viable. Question marks are generally new goods and services which have a good commercial prospective. There is no specific strategy which can be adopted. If the firm thinks it has dominant market share, then it can adopt expansion strategy, else retrenchment strategy can be adopted. Most businesses start as question marks as the company tries to enter a high growth market in which there is already a market-share. If ignored, then question marks may become dogs, while if huge investment is made, then they have potential of becoming stars. 4. Dogs- Dogs represent businesses having weak market shares in low-growth markets. They neither generate cash nor require huge amount of cash. Due to low market share, these business units face cost disadvantages. Generally retrenchment strategies are adopted because these firms can gain market share only at the expense of competitors/rival firms. These business firms have weak market share because of high costs, poor quality, ineffective marketing, etc. Unless a dog has some other strategic aim, it should be liquidated if there is fewer prospects for it to gain market share. Number of dogs should be avoided and minimized in an organization. So here we place cheetos in the question mark column (?) i.e.

Cheetos

So we are yet to decide whether to make it a star product or to kill it like a dog .

Ansoff matrix : The Ansoff Matrix, designed by Igor Ansoff, classifies and explains different growth strategies for a company. This matrix is used by companies which have a growth target or a strategy of specialization. This tool, crossing products and markets of a company, facilitates decision making. The Ansoff matrix offers four strategies to achieve the objectives.

GOLDEN RULE : opportunity to expand on an existing market but one can also explore the possibility to withdraw from the market or find new markets. level. This risk increases proportionally with the level of change. Diversifying is more risky than increasing the penetration of a product on an existing market.

EXISTING PRODUCT
MORE SHELF SPACE EXISTING MARKET MORE SUPPLY OF ALL VARIANTS

NEW PRODUCT

NOT APPLICABLE

NEW MARKET

PILOT MARKETING ADD COMM LOCALISATION OF PRODUCT

NOT APPLICABLE