Executive Summary
MSH Brands is a company that has established itself as one of the leading dog food manufacturers. It sells affordable products and shows slow but stable growth in terms of annual revenue. MSH Brands has to introduce a new weight-management offering for dogs to find a source of competitive advantage. The problem of obesity among pets has been increasing over the past decade and has led numerous owners to seek solutions to help their dogs return to normal weight. MSH Brands’ new product will consist of a mix of organic meats, fish, and vegetables which will be substantial to respond to the nutritional needs of all dogs. The company has to follow the differentiation strategy when marketing the product, stressing its benefits such as high-protein and low-fat content. In two years after the launch, the product should help the company gain a one-percent share in the pet-obesity management market.
Business Context
The problem of excessive weight in dogs has always been difficult to tackle, which often led owners to seek various solutions for obesity management. The most extreme forms of interventions which can positively affect weight loss in pets require invasive procedures, which owners try to avoid fearing further health complications. Yet, with the current rate of advancements in the field of nutritional science, researchers have managed to identify key elements necessary for successful weight loss in dogs. The current product will constitute a dog food which will consist of a unique mix of macronutrients and essential elements, which has been proven to reduce weight in dogs.
The product in question possesses various features that ultimately make it exceptional compared to other alternatives available on the market. The main element that will distinguish the product from those of the competitors is the high meat content. Recent studies showed that high-protein diets are most effective as an anti-obesity treatment in canines (German, 2016). Mixing different types of meat and other protein sources such as cod liver and vegetables will provide well-balanced dog food. As a result, the product will be a source of high-quality protein required for the development of lean muscle in dogs.
The company can significantly benefit from the rising demand for products that can help dogs lose excessive fat. For instance, as research demonstrates, in the United States, more than fifty percent of all dogs are considered overweight or obese (“2018 pet,” 2019). The situation is similar in all advanced economies of the world, including in the United Kingdom. Thus, the company must capitalize on the issue and offer its effective solution to counter dog obesity.
The corporate objectives for the product must be set in accordance with a long-term growth plan which implies a gradual increase of the company’s share in the weight-loss dog food market. As research indicates, in 2018, the size of the pet obesity management market was valued at more than six hundred million dollars (Grand View Research, 2019). Thus, securing a one percent market share over the first two years can be an attainable objective with the product in question. In five years, the market share has to reach at least three percent, and at this point, additional products can be introduced. Additionally, one of the key corporate objects in relation to the offering must be increasing customer awareness about the product and engaging as many people in learning about high-protein diets’ benefits as possible.
Situation Analysis
SWOT Analysis
Strengths
MSH Brands has various strengths, yet the main one is its position among the five large pet food companies. As a result, MSH Brands is well-recognized among customers who previously tried its products and were satisfied with their quality. Moreover, since MSH Brands manages to be ranked among the top five dog food producers, it possesses advanced manufacturing facilities, making it possible to launch the production of new goods quickly. Finally, the company sells dog food, which is in high demand among customers because the number of pet owners is constantly growing.
Weaknesses
The primary weakness of MSH Brands is the lack of diversity of its product line and a failure to target certain niches. The company does not have a type of dog food conducive to weight loss in canines. Additionally, MSH Brands does not sell products which would constitute a competitive advantage for the company. In other words, the enterprise’s goods can be replaced with alternatives of other industry players. The fact that there are four more large dog food companies demonstrates that MSH Brands is not in a position where it is certain of success in the future.
Opportunities
Nevertheless, MSH Brands has numerous opportunities which it can utilize to gain a competitive advantage in the industry. The company’s key prospect is the ability to start offering products that would appeal to certain audiences. For instance, it can develop dog food for one particular breed based on its particular nutritional requirements. The company also has an opportunity to venture into the sphere of producing pet accessories. Moreover, the company has a considerable chance of further expanding its operations into the markets that were not previously targeted by it.
Threats
The main threat to MSH Brands is the competition since, in total, there are five large pet food companies which mostly make products for the same customers. Thus, the business faces the threat of losing its market share to the enterprises that will manufacture better alternatives. There is also a certain tendency among pet owners to feed their dogs and cats natural foods and not processed ones. MSH Brands may potentially lose clients if its products become undesired by them.
PESTLE Analysis
Political
Political factors which can affect the stability of MSH Brands include parties which exhibit an inclination towards introducing legislation to ban animal testing. Before products enter the market, the company has to ensure their safety first, which is often performed through experiments on animals. Prohibition of such activity may entail sizeable expenses for the company, which will have to embrace more expensive alternatives of the procedure in question.
Economic
An economic crisis is a considerable threat to MSH Brands’ business since it is an unpredictable event which leads to many negative consequences. For instance, people struggling due to an economic downturn may start feeding their pets cheaper food. Individuals also can avoid getting a dog in the first place. While banks may not be willing to grant credit to the enterprise.
Social
One of the social problems that can impact MSH Brands is the consumer demand for pets. For example, people may follow a trend which will involve avoiding having dogs at home because they may trigger allergies. Another possible social factor is negative reviews on social media about the products of MSH Brands, which can discourage others from buying them.
Technological
Since the dog food industry has strong competition, it is possible to assume that companies invest heavily in research and development. There is a chance that one of the enterprises may discover a way to significantly lower manufacturing costs of dog food which will provide it with an advantage. Another potential scenario is the creation of a proprietary formula for dog food by one of the companies which will deliver the best weight-loss effect in canines.
Legal
Legal factors are inextricably linked to political ones, and legislation which regulates how dog food is made is the issue which particularly threatens MSH Brands. The government may adopt new laws prohibiting different ingredients essential to the company’s products. Additionally, MSH Brands may face lawsuits if it does not ensure proper quality control.
Environmental
Environmental concerns related to dog food production also can negatively impact the company’s operations. Research demonstrates that the pet food industry emits more greenhouse gas than the Philippines (“Area twice,” 2021). Thus, MSH Brands has to find innovative solutions to reduce its carbon footprint.
Target Market
The target market of the new product has to be people who own dogs with weight problems and who are willing to spend extra money on premium goods. The product will be priced slightly above its competitors’ alternatives; therefore, the target clientele is middle-class individuals. In terms of how old the main group of clients should be, the company has to market the product to people aged between 25-65. These individuals tend to have enough resources to cover all of their pets’ needs, including the necessity for them to lose weight.
Product Portfolio and Sales
MSH Brands has a standard portfolio of products which are similar to those of its competitors and which fail to provide it with a competitive advantage. The company sells quality dog food which can be consumed by pets of all ages. Additionally, it has a separate brand which makes snacks for dogs, such as sausages and bones. The weight-management food will fit in exceptionally well in the line of the brand’s products. The new offering will be unlike any other one in the portfolio because it will be made specifically to assist owners in reducing dogs’ weight.
The company currently sells thousands of its products every month, yet its revenue growth has been slow in the past two years. Dog food accounts for most of the enterprise’s sales, while snacks constitute only ten percent of the total inventory purchases. The products of MSH Brands are sold through different distribution channels, among which supermarkets and discount stores are the largest ones.
Competitors
As mentioned earlier, the dog food industry has a considerable degree of competition, leading to companies trying to innovate and offer new products constantly. Mars Petcare, Inc. is the company which generates the highest amount of revenue and has the largest market share. Pedigree, one of its brands, has a product which seeks to maintain a healthy weight in dogs (Pedigree, n.d.). Another competitor is Nestlé Purina Petcare which had a revenue of thirteen billion dollars in 2018 (Henneberry, n.d.). The company also has several weight-management products made specifically for small and large breeds (“Dry,” n.d.). J.M. Smucker is also a serious competitor for MSH Brands’ which owns Nature’s Recipe, the company producing healthy-weight dog food (“Nature’s,” n.d.). Finally, the last businesses making similar goods is Hill’s Pet Nutrition which manufactures veterinary-recommended dog food for overweight pets (“Adult,” n.d.). Thus, MSH Brands faces a difficult situation where it has to expand its products to increase revenues.
Marketing Strategy
The ultimate goal of every marketing strategy is to achieve a competitive advantage that would allow the company to deliver better products and services than those of other businesses. Thus, the problem of competitive positioning becomes necessary to take into consideration when developing a new offering. MSH Brands has a strong positioning in the industry as a brand of affordable but healthy dog food and snacks loved by owners. Despite being among the top five dog food manufacturers, the annual revenue of MSH Bands is lower than that of its competitors. The new weight-management product will allow the company to enter the segment of premium dog food. Unlike the standard offerings by MSH Brands should address the needs of owners who are ready to spend extra money on their pets’ diet.
The product will be more expensive because it will be made mostly of costly animal ingredients. Additionally, the new product will contain a considerable volume of vegetables in the mix. It will also be grain-free since recent studies demonstrate that such diets cover all nutrient needs of canines and reduce the probability of gastrointestinal disorders (Chiofalo et al., 2019). The company cannot embrace cost leadership as its primary marketing strategy because there are less expensive weight-management alternatives on the market. Nevertheless, the lack of products with an increased content of animal ingredients and the absence of grains make the new offering perfect for espousing the differentiation strategy.
Following the differentiation strategy, the company will be able to attain its corporate objectives. The product has to help MSH Brands to secure a one-percent market share in the pet weight-management industry in the first two years. Such a goal is achievable since the offering is considerably different from other products in the market, which will guarantee its niche. As more people will begin using it and recommending it to their friends and family, the market share is expected to increase to three percent. Thus, the product positioning statement should read as follows: MSH Brands’ weight-management dog food is for owners who need to reduce the weight of their dogs.
Marketing Tactics
Promotional Strategy
The promotional strategy for the new weight-management product of MSH Brands should involve different tactics targeted at various potential customers. The first medium through which the product will be marketed is the Internet which will help the brand reach the younger clientele aged between 25 and 40. The tactic here should include partnering with bloggers to create content in the form of videos and posts, demonstrating the advantages of grain-free dog food for weight management in canines. Nevertheless, the bloggers will be asked not to advertise the product in question since this project will be generally educational.
The additional tactic will imply free sampling in supermarkets and discount stores, mostly targeted at people over 40 years old. People belonging to this group are more likely to visit stores in person and not shop online. This tactic aims to make people familiar with the product and give them a chance to test its quality for free and buy it in the future. Such a two-fold strategy will allow the company to achieve the corporate objectives by exposing people to the benefits of a high-protein and grain-free diet for dogs.
Pricing Strategy
As noted earlier, the price of the new product will be higher than that of the existing alternatives due to expensive ingredients. For instance, one of the competitor’s weight-loss solutions contains numerous grains, including barley, rice, and oats which are cheap and help reduce the price to sixty dollars but do not provide quality nutrients (“Adult,” n.d.). MSH Brands’ offering will cost slightly more, approximately seventy-five dollars for the same volume and made strictly out of animal ingredients and vegetables. Grain-free diets have been proven to increase digestibility in dogs which is essential for effective weight loss (Pezzali & Aldrich, 2019). Nevertheless, considering that many people will be unlikely to try a product that will cost more than other alternatives, the company has to implement the penetration-pricing strategy. Specifically, MSH Brands can reduce the price to sixty-five dollars during the first month of sales and then gradually increase it (Kotler & Keller, 2016). Such an approach will ensure the achievement of the corporate objectives by engaging more people to buy the product.
Distribution Strategy
The distribution strategy for the new product should involve selling it through different channels, both traditional and modern ones. The significance of supermarkets and discount stores such as Walmart and Target should not be underestimated since, as discussed earlier, they constitute the main place where people buy dog food. Thus, ensuring proper contracts with these providers should become a priority for the company to meet the corporate objectives and expose as many clients to the new offering possible. MSH Brands should not overlook specialized pet stores since they can also play an important role in educating customers on the benefits of grain-free dog food. Finally, considerable attention should be given to establishing infrastructure for facilitating online purchases. Clients should have an option to order the product on the company’s or distributor’s official website. A mix of the aforementioned distribution channels will let the company deliver on its corporate objectives.
Advertising Strategy
When drawing an advertising strategy for the MSH Brands’ weight-management product, one should once again utilize all possible platforms. Online advertising should come first because many people use the Internet and receive their information from it. The company can run commercials on platforms such as YouTube and Facebook, which would contain facts and statistics on the benefits of grain-free and high-protein diets for weight loss in dogs. Additionally, such commercials can appear on television channels since they will help cover many potential clients. The brand also has to establish its presence on social media and launch a campaign that would list all the new product’s advantages. In this case, the reasonable decision would be to hire a celebrity who would endorse the offering. Thus, MSH Brands has to utilize television channels and social media to advertise its product to attain the corporate goal of reaching out to the largest audience possible.
The overall strategy of MSH Brands for the product in question concerns differentiation, and the marketing tactics should reflect it. The promotional tactics have to be targeted at increasing potential clients’ awareness of the effectiveness of grain-free diets for weight management. Additionally, the company should lower the price for the new offering during the first month as a way to make it more affordable to customers. The clientele should have easy access to the product, and therefore it should be distributed through both stores and online platforms. Finally, when advertising the product, the company has to stress its weight-management benefits in dogs.
Effectiveness
The current marketing plan has to possess certain controls which would be utilized to assess its effectiveness and success. Previously, it was established that the corporate goals concerning the new weight-management solution from MSH Brands concern the necessity to raise awareness and reach the market share of three percent in half a decade. The market share constitutes the primary metric that will allow the company to determine whether the marketing plan was effective. Another important metric to take into consideration when calculating the market share is sales growth. Based on the data from 2018, the size of the pet-obesity management market was valued at approximately six hundred dollars. Thus, in two years, the sales of the new product should reach at least eighty thousand units per year which will amount to six million dollars in revenue. In the first year, the company should sell forty thousand units of the product and increase the sales in a year by fifty percent. By the fifth year, the sales should triple compared to the second one.
The marketing plan also implies assessing other aspects, especially advertising, because it constitutes attracting new clients. When analyzing the effectiveness of different advertising approaches, various types of tools can be utilized. For instance, to establish whether commercials on social media impacted the viewers, the company has to check the number of users who clicked on the link leading to the product presentation page. Similarly, the company must see the results generated by posts of blogger-partners. The aim of online marketing has to be achieved by the second year of five percent of purchases made through the official website. Indeed, the value of television should not be underestimated, yet in this case, there is only one possible metric to use, which is the total number of viewers. By the second month after launching the product commercial on TV, at least fifteen million people will have to watch it.
Customer awareness is the next factor which should be considered while analyzing the marketing plan’s effect. Television grants a chance to see the potential number of viewers who saw the commercial. At the same time, field research can help understand whether it translated into any product knowledge among clients. Thus, the company can sponsor monthly surveys of people shopping in large discounters about whether they have heard about MSH Bands’ weight-management dog food. The goal here is for the percent of dog owners who know about the new offering to reach fifty percent by the end of the first year. Additionally, the company should track customer complaints, which must reach no more than three ones a month by the second year.
Distribution is another important aspect that is required for fully understanding the effectiveness of the marketing plan. It is clear that now many supermarkets and discounters will be ready to buy it before the launch of a new product. Therefore, the company must be oriented towards gradually increasing the number of retailers in its supply chain. By the third year, eighty percent of all major discount outlets must have the product featured on their shelves. Moreover, it can be expected that retailers will order small batches of the product during the first months. In the case of immediate success, there is a possibility that there will shortages. Therefore, the company must maintain an average stock volume of approximately five thousand units during the first three months before the demand pattern is clear.
Summary
MSH Brands is a company that ranked fifth according to the size of its revenue in the dog-food industry. It manufactures affordable and healthy nutrition products and snacks, and its sales have been rising slowly but steadily in the past five years. The company has to innovate to stay competitive and present a product that would be different from those of other brands. A weight-management dog food conducive to the loss of excess pounds is a reasonable choice for the company as a new offering. The product will consist of animal ingredients such as different types of meat and fish, liver and vegetables. Additionally, it will be grain-free since crops have been found to reduce digestive ability in canines.
Due to the expensive nature of the ingredients, the company will have to espouse the differentiation strategy for the product. The corporate objectives of the offering will concern increasing the awareness of people about the benefits of a high-protein diet for weight loss in dogs. In terms of financial metrics, in two years, MSH Brands must gain a one-percent share of the pet weight management market with the help of the product. In five years, the company should reach a three-percent presence in the market and, at this point, it will have to expand its line of products. MSH Brands have to prepare for a rapid demand increase during the first months after the product launch and maintain an extra inventory of at least five thousand items ready for shipment.
The company has to implement a marketing plan to support the successful launch of the offering. The plan involves conducting promotional campaigns in the form of join-projects in partnership with bloggers and sampling. The company also has to invite a celebrity to endorse the offering and introduce commercials on television and social media platforms. Such tactics will increase the awareness of customers, which can be measured through monthly surveys in supermarkets. MSH Brands has to ensure that every citizen of the country has easy access to the product both in brick-and-mortar and online stores. Implementation of all aspects outlined in the marketing plan will allow MSH Brands to succeed with the new product.
References
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