Growth
This is where the product is being advertised usually with the aid of a promotional campaign e.g.: Goal den balls. The product will also be widely available and be advertised using a widely read or watched medium.
Maturity
The product reaches a sales peak and stays level this is where the product has now become widely known.
Saturation
This is where the product begins to decline because of market saturation this will happen until all sales cease.
Extension strategies
After the product has reached maturity the company will try a number of things to try and boost sales and stop the product reaching saturation. One example is suing the product name but spawning several different new products e.g. Wotsits minis and wofflers are very good examples of this and because of these the Wotsits brand still has not reached saturation. Another is by using a new promotional campaign but this can be costly and the effects will not last long after the campaign has ended.
Market segmentation
Because of the massive market segmentation which the snacks market has undergone for golden wonder to be totally effective a product solution must be provided for each segment of the snacks market.
E.g. this flow diagram must be considered and a product produced for each segment. .
Some of the main market segments golden wonder have targeted are 0-5 mini Wotsits 5-10 Wotsits Teenage wheat crunches 20-30 women golden lights and then the crisps which span most market segments.
Golden wonders product port folio.
Wotsits
Wotsits is the definitive cheesy bagged snack and a market leader in kids snacks. The original corn puff was launched in 1971 and has been followed up more recently with the launch of:
- Wotsits Wafflers the taste sensation of Wotsits put into big & crunchy waffle shapes
- Weenie Wotsits small Wotsits in small packs for small appetites
- Wotsits Goalden Balls authentic football shapes with a tangy cheese flavour that deliver extra kick
Wotsits has grown by over 80% since 1995 and is now a £50m brand, selling over a million packs a day.
The different varieties of Wotsits are an attempt to extend its product life cycle. And to expand into new segments of the market. Golden wonder have tried to make the packaging for this reflect there slogan “what a whopping whoosh” by using the contrasting orange whoosh. This also reflects the cheese flavour and makes it eye catching so it will appeal to young children. Golden wonder also use this to launch new Wotsits varieties if a child sees the whoosh and they usually get normal Wotsits they may think they are Wotsits and get tricked into trying a totally new variety thus they now have product awareness of the new product.
Nik Naks
Nik Naks is the stimulating snack in vibrant flavours and uniquely knobbly sticks. It is available in Nice 'N' Spicy, Rib 'N' Saucy and Cream 'N' Cheesy flavours.
The brand has grown every year since its relaunch in 1996.
These are aimed at teenagers and have more sophisticated and less eye catching packaging conveying quality not cheesiness. They have also tried to extend the product life cycle by introducing new flavours.
Wheat Crunches Wheat Crunches is the honest snack that delivers a truly satisfying combination of full flavour and crunch. It is available in Crispy Bacon, Spicy Tomato and Worcester sauce flavours.
Wheat Crunches was launched in 1981 and has grown significantly ahead of the market ever since the management buyout in 1995. This is an example of how the name of golden wonder alone can inject life into the product life cycle, this product has also crossed over into a new market and has become very popular in student unions as well and the original adult market it was conceived for.
These don’t need much market promotion because golden wonder is a widely known company in the UK and is trusted; this product also helps support the other products by using the name golden wonder in the same font and style on all the packs. So a golden wonder product is always easily recognisable.
Golden Lights
Pleasure and taste without the guilt!
Golden Lights is a tasty, pleasurable light potato snack with less than 4g of fat per pack and only 92 calories per pack.
Golden Lights was voted by the readers of Slimming magazine as winner of the Light & Low Savoury Snacks award for 2002.
It is available in Lightly Salted, Sour Cream & Onion and Salt & Vinegar flavours.
This is an attempt to sell to women between 20 and 30 who are very weight conscious this is a good market to get into because it is growing rapidly. And although there is usually not that much difference between golden lights and normal women will still by the golden lights because of the psychological aspect.
Duets *NEW*
New Golden Wonder Duets is perfect for in home entertaining & sharing. It is a combination of lightly salted crunchy dippers and a tasty dip available in Salsa, Onion & Garlic & Sour Cream & Chives. The dip is ambient stable which means that the product can be stored in your cupboard for added convenience...
This is an attempt to get into the special occasions segment which golden wonders has neglected to do for years.
Bugles
the result of a joint venture with General Mills Inc. Bugles is a crispy cone shaped corn snack available in 3 flavours BBQ, Cheese and Salt & Vinegar.
Own Label
Golden Wonder has gained significant market share in own label products, and has become the clear market leader. A low cost and high quality producer, Golden Wonder has forged excellent working relationships with the UK's largest food retailers. Golden Wonder was also the first company to produce own label stackable chips in April 2000. An octagonal tray which is ideal to share from.
3.2 Pricing
As golden wonder operates in an oligopoly market the only real factor it can compete on is quality and because of this most of the products that Golden wonder and Walkers produced are priced virtually identically priced. See graph below (These prices are based on the recommended retail prices of Golden wonder and Walkers)
←This is the only price difference between Walkers and Golden wonder.
When pricing a product golden wonder has a choice of 3 types of pricing:
Competitor pricing
The company will set its prices to virtually match the market leaders, this is usually done in oligopoly market where price competitions would result in the eventually bankruptcy of every company in the market because they would keep undercutting each other until they didn’t make a profit. This is the pricing scheme golden wonder use so if a packet of walkers crisps cost 27p there R.R.P (Recommended retail price) will be the same.
Consumer Pricing
Extensive research is done, usually by questionnaire or panel and it is determined how much a customer would be willing to pay for the product in question. This is not appropriate for Golden wonder because if they did this there prices would not match the rest of the markets and either every other competitor would have to do the same or golden wonder would go bankrupt due to the profit being lost with the new prices.
Profit Margin and cost Plus
Golden wonder have to make sure they make a profit that covers the cost of production (Cost of production, Raw materials, wages , warehousing, distribution cost ,advertising & promotion).One easy way of making sure you do this is to use Cost Plus this is where you add up the costs of production and add a certain percentage as your profit margin. Golden wonder dose not use this because of the same reasons stated in consumer pricing. However if golden wonder did use this then the break down of the production costs of Wotsits would look something like this.
Raw materials = 10p
Fixed costs= 12p
Profit Margin at 22%= 5p
Price=27p
Golden wonder will try and keep there prices the same throughout the market because they will want there products to be sold at the same price as there competitors so the customer will not be tempted to buy the lower priced product. Although Golden wonder have set clear RRP prices some shops and businesses do not stick to the guidelines.
(See chart on next page for graphic comparison)
As you can see there is a very big difference between the super market and the newsagents. This is because in big super markets like Sainsbury’s pricing is largely dictated centrally so that if you go into a supermarket in London and buy a packet of crisps and then u buy one in Nottingham the prices will be similar if not identical. But Newsagents prices are set by the owner so he/she can set the prices at whatever price they feel right and in some cases totally reject the RRP and charge over or under this price. This means that if they have not set the same price for walkers then Golden wonders will not sell as well if at all.
3.3 Packaging and promotion
Promotion is one of the most important things a company must do in order to survive, without promotion none of the retailers will know that the company exists and without promotion the company can’t establish a reputation for its products in the market it is trying to enter.
There are 5 main types of promotion but only 4 can be suitably applied to golden wonder products.
Advertising
This is any promotional material that is produced by the company its-self. The most commonly forms of advertising for are Television commercials, Radio, News papers national and local, Bill boards, bus stops, sides of buses and websites.
Golden wonder mainly focuses its advertising on its website and its TV promotional campaign with the cartoon character Willy this is a very good way of advertising because the cartoons are cheep to produce and they are stimulating for younger audiences.
Screen Grab for advert of pot noodle.
Publicity
This is anything that may aid the companies’ reputation with the target audience eg: kit bags with the golden wonder logo on will be seen by the Childs class mates and therefore they will become “brand aware” of golden wonder.
This usually takes the form or In-store posters, In-Store Promotion, Bags, P.O.S (point of sale, Uniforms with company logo, business cards and signage on stationary. Also this is used on the internet e.g.: banner adds and popup's advertising the golden wonder logo and brand.
Sales Promotion
This is any kind of promotional item E.g.: footy flikas and win a “W.W Beetle” it usually takes the form of one of the following:
B.O.G.O.F (buy one get one free) 20% extra, 10% off these are usually targeted at gate keepers.
Free gifts like footy flikas and wooshers or any small toy, these are usually found inside the packaging of the product.
Tokens and vouchers for other packets of crisps or products. One very successful example of this was run by walkers with the “books for schools” scheme this appealed to the gate keepers because it would make them think that by buying this product it would help there Childs school and so help there childes education.
Sale periods brief periods when a product is at a very low price, usually used in new products which are being introduced to the market.
Competitions, usually prize draws to win one big prize e.g.: V.W Beetle.
P.R (Public relations)
One good example of this is with Goalden balls were Ant & Dec were sponsored by Golden wonder to take part in an event with many children from all round the country unfortunately the event did not take place due to it falling on the queen mothers funeral. Other forms of P.R are community links and press releases another good example of P.R was when there was an article in a paper that had found out that Golden wonder were trying to get David Beckham to sponsor Goalden balls and Posh Spice to sponsor rival Walkers new “posh crisps”.
Direct marketing
This is not used by Golden wonder at all will only work if targeted very carefully, other wise it will annoy people instead of make them want to but the product.
Direct marketing is usually in one of these forms.
Door to door sails
Internet
TV
Catalogues
Phone
Post (Direct mail)
Packaging is a sub division of promotion it is from design and art work on the containers the food arrive in to the artwork on the packets them selves.
Most company’s will try and use bright and eye catching packaging and may also put there logo on in a large font depending on the reputation of the product, E.g. if it is a new unknown product the product will have to have the companies logo on in a big font so the consumer knows that is from a company that they trust and will there for buy it. If however it is the packaging for a long running product e.g.: Nik Naks , Wotsits or Wheat crunches the company logo dose not need to be displayed as big or at all because the product will already have built up a reputation for its good taste or high quality. Company’s will also try and use psychological incentives on there packaging E.g. “New fuller flavour” and “Bigger bag” although the flavour may be have only slightly altered and the bag grown by a few grams, it will make the customer want to try the new flavour because it is a new experience, or the bigger bag because they are hungry and the companies competitors may not have this displayed and even though the contents may be exactly the same weight the customer will go for the “bigger bag”.
Below are some examples of how Golden wonder have used packaging in conjunction with promotion to great effect.
