Truearth Healthy Foods: Market Research for a New Product Introduction
[pic 1] MARKETING MANAGEMENT-I Case Study on:TruEarth Healthy Foods: Market Research for a New Product IntroductionBY: BATCH-8ARCHIT MORE-18A3HP652CYRIL THOMAS-18A3HP653SHASHANK MATHUR-18A3HP640SHUBHAM JAKHMOLA-18A3HP620SHYAM SUNDER-18A1HP021SIDDHARTH SEHGAL-18A1HP090VINAY THAPLIYAL-18A2HP452SUMMARYGareth DeRosa founded TruEarth in 1993 in St. Louis, Missouri, which sought to capitalize on healthier gourmet pasta and sauces which were made from superior ingredients. Their product line featured both standard and specialty pastas. In starting of 1990s , there was a threefold change in the consumer behavior as to how consumers purchase their groceries. Due to increase in dual income households and time-poverty, the first category food which is “HOME MEAL REPLACEMENT” was introduced, which does not need any preparation time and is ready to eat. The second change was the growth of refrigerated fresh pasta. During that time consumer’s mentality was that the fresh is more healthier and tasty that the dry pasta. The third change which was seen was inclusion of whole grain in the consumer’s diet. TruEarth was one of the first companies to offer both 60% and 100% whole grain pastas. The concept of premium or superior quality food product became successful and by 1998 the had developed a good base of loyal regional customers. As their products were in high demand, several major supermarkets started keeping their products. Further, the company started promotions through coupons, magazine advertisements and in-store demonstration.
In order to take advantage of increasing demand for refrigerated fresh pasts with whole grain options TruEarth developed a product called Cucina Fresca, which is Italian for “fresh kitchen”.it came with a full range of choices along with sauces and were designed to be consumed in a single meal for two. Consumers felt that fresh pasta was tastier and more authentic than dry pasta which was offered by most of the companies including Truearth. Due to technological innovations in packing, companies were able to manufacture fresh pasta for mass sales through supermarkets. In 2006 Truearth officially launched Cucina Fresca, for which a breakeven sale of $14 million at wholesale in the first year was required but instead the product made $18 million in retail sales in in the first year and $35 million in the second year. This made it the most successful product launch in the company’s history. However, sales slowed down in 2008 as competitors such as Rigazzi, Nestle and Kraft came up with similar products. In order to sustain a competitive edge, especially in the fresh Italian food market , continuous innovation is required. Thus in order to maintain its first mover advantage and market share, TruEarth has invested heavily in launching a unique and healthy pizza offering.