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TruEarth Healthy Foods Market Research for a New Product Introduction Case Solution

Solution Id Length Case Author Case Publisher
1136 1032 Words (3 Pages) V. Kasturi Rangan, Sunru Yong Harvard Business School : 4065
This solution includes: A Word File A Word File and An Excel File An Excel File

TruEarth is a gourmet food product manufacturer, established in the 1980s, to cater to the increasing shift in demand for a healthier alternative to junk food. The change in consumer preferences by the 1990s meant that the cornerstone on which the company’s business strategy was developed became even more important. With more and more households having both partners working resulted in two things; firstly, higher disposable income, and secondly, lower free time available. This meant that there was a general move from home-cooked meals to the readymade, or easy to make meals. Coupled with looming health consciousness, the market for gourmet semi-cooked meal kits was ripe.

Following questions are answered in this case study solution

  1. Introduction

  2. Market Analysis and Company Product History

  3. TruEarth’s Fresh Wholegrain Pizza

  4. Financial Aspect

  5. Conclusion

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Case Analysis for TruEarth Healthy Foods Market Research for a New Product Introduction

Market Analysis and Company Product History

TruEarth had been able to successfully launch products, which were a hit with the consumers, in the past. The most notable of these was the Cucina Fresca, a fresh whole grain pasta meal kit sold through supermarkets. There were several reasons for the success of the product, all of which apply for a new launch, as well.

The foremost reason, as already mentioned, was the need in the market for a quick fix meal. Cucina Fresca provided this at affordable prices. Given the health angle, there were many producers that were making healthy quick-to-make meals, but the downside of making such healthy food products was the degradation of taste. Herein lays the second reason for Cucina Fresca’s success. The pasta was not only healthy and made out of quality ingredients, but also tasted great thanks to TruEarth’s development team’s efforts.

However, the product itself was not the only reason why the company was able to capture such a large market share. The company’s ability to move into the market with the launch before its competitors magnified the launch’s impact. The first-mover advantage garnered by the early release helped the company reel in a large consumer base and develops a brand loyalty that ensured repeat purchases. The first-mover advantage may be seen as more of a myth than fact in other industries, however, in the gourmet meal industry, if the product is good enough, moving in first can have a significant positive impact on sales.

TruEarth’s Fresh Wholegrain Pizza

Since the new product is targeting the same market segment as the company’s previous product, the pasta, and sauce meals, the same elements will determine its success or failure, as well. Therefore, in order to evaluate the product’s profitability, it needs to be judged based on its value for money, taste, health outlook, and timing of introduction.

TruEarth has a set of guidelines that govern its market research process. The business in the early stages develops prototypes of the product and tests them on focus groups before it is approved for a pre-release stage where the product is further tested in the actual market with the help of Nielsen BASES®, a market research firm. The firm conducts one preliminary test, called BASIS I, in which it tests the consumer interest and awareness. After that, it conducts a more detailed BASIS II test, which includes other aspects of the product as taste, value for money, etc. Both these tests were conducted for TruEarth’s Fresh Wholegrain Pizza, as well.

Based on the results of the surveys conducted by Nielsen BASIS, the new product was showing some promise. Of the 300 participants, 181 were favorable to the concept of a semi-cooked pizza that could be bought off the shelf. 119 participants were skeptical of the product launch and didn’t like the idea. The 181 participants favorable to the concept were obviously more inclined to give positive reviews to the product’s attributes (data table shown in Exhibit 8), than the unfavorable participants, when asked to select what they like about the product. The largest numbers of likes were achieved by the attributes “can purchase all items in one place” and “freshly made and dated," closely followed by “looks appetizing."

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