BETTER HEALTH WITH SNACKS

Deluxe Chips is one of the leading companies in the salty-snack industry, with almost one-fourth of the $10 billion market. Its Deluxos tortilla chips are the number-one selling brand in North America, and its Ridgerunner potato chip is also a market share leader. Deluxe Chips wants to stay on top of the market by changing marketing strategies to match changing consumer needs and preferences. Promoting specific brands to market segments with the appropriate price and distribution channel is helping Deluxe Chips succeed.

As many middle-aged consumers modify their snacking habits, Deluxe Chips is considering a new product line of light snack foods with less fat and cholesterol and targeted at the 35- to 50-year-old consumer who enjoys snacking but wants to be more health conscious.

Marketing research suggests that the product will succeed as long as it tastes good and that consumers may be willing to pay more for it. Large expenditures on advertising may be necessary to overcome the competition. However, it may be possible to analyze customer profiles and retail store characteristics and then match the right product with the right neighborhood. Store-specific micromarketing would allow Deluxe Chips to spend its promotional dollars more efficiently.

1			Discussion Questions Design a marketing strategy for the new product line.
2			Critique your marketing strategy in terms of its strengths and weaknesses.
3			What are your suggestions for implementation of the marketing strategy?