Strategic Marketing: Goody’s Ice Cream Tricia Coppola David Wertheimer Strategic Marketing & Implementation April 17, 2004

Strategic Marketing: Goody’s Ice Cream Positioning/Place Recognized that we must have our own plan/strategy – can not follow others Made long-term decisions/plans early Scrutinized opportunity costs i.e. cost of advertising and sales support versus market potential/growth Consistently pushed consumer perceptions of product to position our brand appropriately – create demand Entered markets where our product was appropriate to demand rather than push into the largest segments Negative – financial strains and market risks of product or market diversification (pulled out of one market that we invested in for one year)

Strategic Marketing: Goody’s Ice Cream Price Used R&D investment to drive down internal costs in mature markets with heavy competition Reduced retail prices in mature markets to gain a competitive edge without reducing margin Maintained or raised prices in markets were we had superior product, less competition and high purchase intention = better margins

Strategic Marketing: Goody’s Ice Cream Promotion Used consistent amounts of promotion to maintain leadership position in country segments where we had no competition Heavy investment in new markets to support product launches & create brand awareness; used both advertising and sales support Through investment and strengthening of consumer experience curves we maintained consumer purchase intentions

Strategic Marketing: Goody’s Ice Cream Product Placed a premium on having the right product portfolio for each of our markets –Continuous R&D improvements to address dynamic market environments –Focus on market trends/understanding customer needs to supply appropriate product benefits Said “No” to markets that were too competitive or where our product benefits were not an asset

Strategic Marketing: Goody’s Ice Cream 3C’s Corporation –maintained strong markets while trying to push into new ones –continual R&D to lower costs and revise formulas Customer –launched in segments where product would match demand –used revised formulas to maintain interest levels Competition –tried to predict spending levels and plans, and adjusted our expenditures accordingly –avoided markets where multiple players were already battling (tried once, got burned) –In competitive markets, unable to establish product differentiation; battle fought on price and perception

Strategic Marketing: Goody’s Ice Cream Market Position and Market Share Held sole-provider status in two markets –Increased margins and kept prices high to maximize profit –Continued R&D to maintain hold on each market Had single competitor in three markets –Matched price and spending to keep 50% market share, which provided strong profits ($72-120MM Year 7) in each segment –Pushed R&D so price cuts would not hurt profit margin –Would have benefited from added expenditure to take market share from competition Value in pricing –In our first sole-provider segment, raised prices while increasing ad expenditures and saw good returns

Strategic Marketing: Goody’s Ice Cream Glace (C1 S2) Glace (C4 S2) Shardje (C3 S2) Glace (C2 S1) Glace (C3 S1) Shardje (C1 S1) Year 5 BCG Map (I forget the real name) *** ??? $$$

Strategic Marketing: Goody’s Ice Cream How We Operated Division of labor and strengths –Tricia: market assessment, sales and advertising allotment –David: perceptions, competitor tracking, R&D Comfortable push and pull –Tricia: mass-market and expansion –David: core strengths and positioning Plotting data proved key

Strategic Marketing: Goody’s Ice Cream Charting: brand formulations

Strategic Marketing: Goody’s Ice Cream Charting: perceptual maps

Strategic Marketing: Goody’s Ice Cream Charting: purchase intentions

Strategic Marketing: Goody’s Ice Cream Lessons Learned Balance –Value in both large and small markets –Maintain profitable products to help launch new ones Focus –Don’t try to do too much too fast –Continue marketing and developing products for core markets

Strategic Marketing: Goody’s Ice Cream Lessons Learned Competitiveness –Great to have markets where no one else competes –Surprised that the other teams ceded two markets to us –Saw the impact of ceding markets first-hand: went into and then withdrew from C1 S1 and our withdrawal gave Grateful Fed its biggest gains –Diving into mature markets unwise unless substantial capital (and patience) is available –The first-place team gets no concessions