Starbuck's Case

Marketing 5210

Natureview Farm

Current Position in Natural Foods Channel and Marketing Strategy

Natureview Farm, manufacturer and marketer of refrigerated cup yogurt had three main differentiators that created a market advantage. The three main differentiators are: natural ingredients, longer shelf life, and a reputation for high quality and great taste. Natureview Farm created continuous growth from creating a strong brand, low cost marketing with national distribution in Natural Foods Channel, and strong relationships with distributors.

The Natural Food Channel was slightly inflexible to price changes. It charged premium prices from the target audience which was different from the supermarket target audience. The target audience for Natural food chain was more health conscious and had higher purchasing power. However, prices in this chain were significantly higher, majorly due to the fact that the supply chain system involved an additional key player; wholesaler, whose margin was 7%. In this type, supply chain requires no slotting charges, as required in other options. Marketing expenses will decrease significantly.

Natureview Farm had strong market share of around 24% in this market. It was enormous, because Natureview Farm was the pioneer of yogurt cups in this market. The reputation it created overtime, along with the word of mouth resulted in a strong market share of the firm. The segment of multipack was securing 9% of market share and was growing at 12.5% per annum. 32oz secured 8% share growing at 2% per annum. Whereas, largest share belongs to 8oz pack which was around 74%.

It is evident that Natureview Farm is following differentiation strategy. It is marketing its product on two key aspects; the first one is the shelf life of 50 days, which is 20 days more than the standard product. Secondly, it is not using artificial ingredients, like preservatives. The innovative process is its strength. This strategy decreases risk of spoilage and...