Lay’s can be easily regarded as one of the most popular chips brand in the world. Established in the year 1932 lays is originated in the US. This snack brand has over 60 percent of the snack market in US as well as more than 35 percent in the world market. There are five brands under lay’s which generate annual revenue of $1 billion each these brands are: Lay’s, Ruffles, Doritos, Tostitos, and Chee-tos the product is salty snack food item. The historical brief of ownership of the brand is Frito-L from 1961 and PepsiCo from 1965. Lay’s main product is a variety of potato chips. After Frito-Lay merged with Pepsi-Cola Company to form PepsiCo, Inc. Frito-Lay continued operating as an independently working division of the new company. The company describes itself as a consumer oriented company, the company also has a sustainable business model and recognizes the responsibility the company has towards the society and the environment (Home Page, 2017).
The product that is being discussed in this report is “potato chips”.
Operating in more than 42 countries this can be easily described as one of the most popular snack and chips brand in the world. The idea of the company has always been to produce packed food items in the snack category which is tasty and reasonable.
When it comes to Lay’s the consumer knows that he or she is spoilt with choice. The product range is vast and has something to cater to the taste choice of everyone. The company looks forward to innovations as far as taste is concerned there are a few regular flavors and also some are limited edition ones. There is also variety for the health conscious people fat free and low calorie (Huang & Sarigöllü, 2014).
The product portfolio of Lay’s potato chips is as follows:
The company over the years has been implementing several pricing strategies to suite the motive of the company as well as the customers. The most prominent strategy that has been followed is the value based price strategy which have diverse attributes in order to overcome competitive advantage as well as satisfy customers e.g. accessibility, affordability, high quality and great taste. Lays have implemented a promotional pricing strategy regularly so that the sales volume can be pushed (Armstrong et al., 2015).
Lay’s is a multinational company headquartered at Dorset in the US. The operations of the company is spread in countries like Australia, Argentina, Brazil, Colombia, Egypt, India, Indonesia, Italy, Mexico, Pakistan, UAE, Canada, United Kingdom and South Africa. The distribution networks of the company are strong and convenient for the consumers to avail the product. Starting from local corner shops, discount stores, convenience stores to hypermarket and supermarket the products are available everywhere.
Depending on the country the promotional tactics vary, the marketing of the company is highly influenced by the culture and tradition of the country where the product is being promoted. Though the strategies are different depending on the country, the essence of the product remains the same (Pavlou & Stewart, 2015).
Packed ready to eat snack item
Though the company owns more than 60 percent of the market value in the United States, some of the direct competitions are: the top two are Herr’s potato chips and Pringles; UTZ potato chips and private label potato chips etc.
This is the attribute for which the brand is popular among the loyal customers. The core proposition of Lay’s potato chips is its crispy and yummy chips in diverse flavors. The company intends to expand the business and sales of the company with the help of its quality of product and reasonable price. The crunch and the taste is given most importance as that is the selling point of the product the customers are most of the times hooked to a particular flavor and visit that over and over again (Ponnam & Balaji, 2015).
The stakeholders of the company are the people who are directly or indirectly related to the company. The stakeholders of Lays are positively motivated for the expansion and future success in achieving the aims and objectives. The stakeholders are also looking forward for the more mainstream and more popular versions of the healthy versions of the food item. Customers are regarded as the most important stakeholder by the company and hence any policy or decision that is being taken is in the best interest of the consumers of the brand (Starr & Brodie, 2016).
Product: The Company not only sells potato chips of various tastes and flavors but also has a wide range of snacks like pretzels, tortilla chips, popcorn, cheese curls etc. there are more than 340 items in the bucket of the company.
Price: The pricing strategy of the company implements is cost based strategy and is very popular among the target market.
Place: The snacks are distributed to retail a food outlet which also includes Kmart and Giant Food Stores in the US the products are also available in as well as in Canada and Argentina.
Promotion: The Company has several sales promotion strategies along with the recent focus are on creating healthy food items.
Product: This Company also offers packaged snack items mostly focusing on the potato chips. There are several flavors just like lay’s the unique part about this brand is the packing.
Price: the price is value based and the products are regarded as priced a little higher than lay’s owing to the packaging as well.
Place: the company is a multinational company and has its distribution in more than 80 countries. It is not available in the corner shops of the local market rather Pringles are available in super markets or hyper markets.
Promotion: the company hardly has any mainstream mass promotional strategies, it mostly thrives on sales promotions strategies (Huang & Sarigöllü, 2014).
This section deals with the analysis and examination of the brand thoroughly:
A company before launching a product or service has a set population which the company targets in order to achieve the sales and the revenue by selling that product or service.
Demographic: The company targets people of various age and diversity it encourages friendship and family as there are value packs for gathering and parties as well.
Psychographic: Casual eating habit, people who like spicy and tasty food items, people who like gathering and party
Geographic: The company distributes its products in every local corner shops as well as super markets and hyper markets suggesting a wide group of people. The products are available in the countries where lay’s and PepsiCo has operations.
Demographic: The population can be divided among the age group of 6-60; these are people who are dependent on someone or are also independent as well. The people who are targeted by the company are from the middle or the higher income group as the product is not a necessity it is rather an item which satisfies the taste buds.
Psychographic: Because there is a plethora of flavor to choose from the people are inclined towards being spoiled for choice. This is also one of the easy to find and easy to serve snack item
Geographic: The company is multinational and the product is available even in the local market for the wide target market to reach the end product, the company has a strong distribution unit (Anselmsson et al., 2014).
This is basically the unique selling proposition of the product that a company tries to establish through its market mix and marketing strategies. Point of differentiation is the attribute of the brand that allows the customer to differentiate it among the competition. For Lay’s the packaging is iconic and can be easily stated as the first point of differentiation. The crisp and the taste of the seasoning that is used for the chips are all secret formulas and it makes the second point of differentiation. Lay’s already has a brand value that has been established for over the years of operation, the company already has loyal customers (Dalman & Puranam, 2017).
Positioning is developing a picture about the brand in the minds of the people. The positioning of the brand is directly related to the marketing strategies of the company. Positioning is what the company wants the brand to be perceived in the minds of the consumers. Lay’s positions itself as a cool and trendy brand that is a companion of everyone. It has a casual feel to all the marketing strategies suggesting that it is not a snack that is offered in any corporate meetings or gathering (Singh et al., 2014).
In order to stay connected the brand has to be relevant in the eyes of the customers, the marketing and the promotional activities of the brand are directly responsible to develop the relevance. There can be four divisions of customer obsessed, ruthlessly pragmatic, pervasively innovative and distinctively inspired. Lay’s fall in the category of pervasively innovative as the aim of the company is to constantly innovate and come up with new and improved formulas and flavors for the customers (Krystallis, 2017).
Lay’s is identified as a young carefree and casual brand as the product the company aims to sell is a casual snack item which is not surrounded by seriousness.
Lay’s connects with the customers with the help of promotional activities as well as traditional marketing strategies. The company communicates through radio jingles, television commercials as well as print advertisements (Dalman & Puranam, 2017).
Conclusion
Lay’s is a multi-billionaire dollar company with its strong brand value and market share both in the US as well as in the global market. The marketing and the branding clarity of the comany forms the basis for company success and gaining increased sales volume.
Lays with the help of the goodwill that the company has gathered for over the years have established itself as a successful brand with a good recall value. The company has expanded in many countries exploring the opportunities and strengthening the brand equity. Innovation and product development is another method followed by the company to build the brand equity as the company continuously focuses on coming up with new flavors to cater the taste buds of the target market.
The marketing strategy of the company has always been based on the cultural and the traditional background of the particular country the product is being marketed. Famous celebrities and popular artists are used to endorse the brand. To improve the marketing strategies the company can use sports personalities to promote the low calorie and fat free version of the product. This will help the consumers to connect as well as understand the message of being healthy way better than it being endorsed by any other celebrity. The company can also use digital marketing strategies extensively and focus of worldwide strategy instead of focusing country wise.
Reference list:
Anselmsson, J., Vestman Bondesson, N., & Johansson, U. (2014). Brand image and customers’ willingness to pay a price premium for food brands. Journal of Product & Brand Management, 23(2), 90-102.
Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2015). Marketing: an introduction. Pearson Education.
Dalman, M. D., & Puranam, K. (2017). Consumer Evaluation of Ingredient Branding Strategy. Management Research Review, (just-accepted), 00-00.
Home Page. (2017). fritolay.com. Retrieved 1 November 2017, from https://www.fritolay.com/
Huang, R., & Sarigöllü, E. (2014). How brand awareness relates to market outcome, brand equity, and the marketing mix. In Fashion Branding and Consumer Behaviors (pp. 113-132). Springer New York.
Krystallis, A. (2017). The Concept of Authenticity and its Relevance to Consumers: Country and Place Branding in the Context of Food Authenticity. Food Authentication: Management, Analysis and Regulation, 27.
Pavlou, P. A., & Stewart, D. W. (2015). Interactive advertising: A new conceptual framework towards integrating elements of the marketing mix. In New Meanings for Marketing in a New Millennium (pp. 218-222). Springer, Cham.
Ponnam, A., & Balaji, M. S. (2015). Investigating the effects of product innovation and ingredient branding strategies on brand equity of food products. British Food Journal, 117(2), 523-537.
Singh, J., P. Kalafatis, S., & Ledden, L. (2014). Consumer perceptions of cobrands: The role of brand positioning strategies. Marketing Intelligence & Planning, 32(2), 145-159.
Starr, R. G., & Brodie, R. J. (2016). Certification and authentication of brand value propositions. Journal of Brand Management, 23(6), 716-731.
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