Case Study Light Mayonnaise

1. Marktonderzoek in rechte lijn uitg. De Boeck Marc De Laet Pol Toye Case StudyLightMayonnaise

2. Product Range D&L End 2008

3. Product range Devos-Lemmens mayonnaise:- Regular mayonnaise • Regular lemon mayonnaise • Light mayonnaise • Salad dressing Campbell FoodsProduct Range Mayonnaise Devos-Lemmens2008 Regular Mayonnaise Regular Lemon Mayonnaise Light Mayonnaise Salad Dressing

4. Market Situation End 2008

5. Kraft light mayonnaise was removed at several retailers during the year 2008. The last retailer to delist Kraft light mayonnaise was Colruyt and by consequence the volume of Kraft Light mayonnaise completely collapsed in the last two months of 2008. • Because other retailers delisted earlier, comparing the year 2008 sales of Kraft light mayonnaise with the year 2007 sales shows a steep decrease. The goal of Campbell Foods is to know where this volume went to. It seems that other players in the light segment did not compensate for the loss because the entire segment of light mayonnaise showed a decrease. Could this volume be going to regular mayonnaise or salad dressing? Kraft light mayonnaiseConsumer Insight measuresEvolution

6. The loss of Kraft light mayonnaise is regarded within the market of regular and light mayonnaise + salad dressing. This to make sure that eventual volume flows towards regular mayonnaise and salad dressing are taken into account. • We can see that Kraft light mayonnaise looses 66% of its volume compared to last year. 17.6% of the volume is lost because the consumer of Kraft light mayonnaise consume less of the total category (regular and light mayonnaise + salad dressing) • 48.8% of the volume is lost towards other references within this total market, so 73.5 of the lost volume of Kraft light mayonnaise went to competition, 26.6 % of the lost volume went out of the market. In order to find out where the volume of the delisted Kraft light mayonnaise went, a gain & loss analysis was performed. Hereby we take a look at the volume before and after delisting, the importance of underlying segments/products and what volume has left the segment. Kraft light mayonnaiseGain & Loss analysis – Split competitive & non-competitive lossYear 2008 compared to year 2007 (constant sample)

7. The volume leaving the market was mainly caused by buyers consuming less of the market (but not entirely leaving the category). Kraft light mayonnaiseGain & Loss analysis – Split non-competitive lossYear 2008 compared to year 2007 (constant sample)

8. Within the competitive loss we can see that D&L Light mayonnaise takes 8.4% of the volume of Kraft light mayonnaise. In total all light mayonnaise references takes 16.7% (sum of all net shifts to/from light mayonnaise references) of the volume. • However the regular mayonnaises take 26.6% of the volume and the salad dressings take 5.5% of the volume. So only part of the lost volume of Kraft light mayonnaise stays in the segment of light mayonnaise, main part goes to regular. Kraft light mayonnaiseGain & Loss analysis - Split competitive loss Year 2008 compared to year 2007 (constant sample)

9. If the same table is sorted according to net shift, we can see that 2 references of D&L are in the top 3 products gaining from the lost volume of Kraft light mayonnaise. Kraft light mayonnaiseGain & Loss analysis - Split competitive loss Year 2008 compared to year 2007 (constant sample)

10. If the same table is sorted according to the interaction index, Kraft regular mayonnaise is nr. 1, and some PL products score better. • A higher interaction index indicates that the loss is higher as expected according to fair share. Kraft light mayonnaiseGain & Loss analysis - Split competitive loss Year 2008 compared to year 2007 (constant sample)

11. Taking a look at the various sub segments profiting from the loss of Kraft light mayonnaise in the analyzed mayonnaise market shows a much stronger interaction with regular lemon mayonnaise compared to other regular mayonnaise. Kraft light mayonnaiseGain & Loss analysis - Split competitive loss Year 2008 compared to year 2007 (constant sample)

12. A fairly particular reference was that of Kraft light mayonnaise lemon. A detailed look shows the same evolution for Kraft light mayonnaise lemon as for the other references. The question in this case is whether we can see an even stronger loss towards mayonnaiselemon than already was the case for the total of Kraft light mayonnaise. Kraft light mayonnaise lemonConsumer Insight measuresEvolution

13. The loss of Kraft light mayonnaise lemon is again regarded within the market of regular and light mayonnaise + salad dressing. This to make sure that eventual volume flows towards regular mayonnaise and salad dressing are taken into account. • We can see that Kraft light mayonnaise lemon loses 62% of its volume compared to last year. 18.1% of the volume is lost because the consumer of Kraft light mayonnaise lemon consumed less of the total category (regular and light mayonnaise + salad dressing) • 44.2% of the volume is lost towards other references within this total market, so 70.9% of the lost volume of Kraft light mayonnaise lemon went to competition, 29.1% of the lost volume went out of the market. Kraft light mayonnaise lemonGain & Loss analysis – Split competitive & non-competitive lossYear 2008 compared to year 2007 (constant sample)

14. The volume that went out of the market was mainly caused by buyers consuming less of the market. Kraft light mayonnaise lemonGain & Loss analysis – Split non-competitive lossYear 2008 compared to year 2007 (constant sample)

15. We can see that the loss to regular mayonnaise lemon is 14.3% with an index of 110.1 compared to a loss of 7.8 to regular mayonnaise other with an index of 43.4. • This difference is clearly more pronounced for Kraft light mayonnaise lemon than for the total of Kraft Light mayonnaise. Kraft light mayonnaise lemon and totalGain & Loss analysis - Split competitive loss lemon Year 2008 compared to year 2007 (constant sample) Kraft light mayonnaise lemon Kraft light mayonnaise total

16. Conclusion

17. Due to the delisting at several retailers, Kraft light mayonnaise strongly lost volume in the market. Only ¼ of the loss can be explained by lower consumption of the market (regular and light mayonnaise + salad dressing), so the main part of the loss goes to other references within the market. • However we can see that the light references within the market only take 25% of the lost volume, where D&L is the biggest winner, but mainly the regular mayonnaises take 40% of the lost volume. Here D&L is in second position. • In the loss of regular mayonnaise, lemon plays an important role. This is even more pronounced if we only look at Kraft light mayonnaise lemon. So we can state that besides a light mayonnaise these buyers are looking for a lemon touch. So, what’s next? Kraft light mayonnaiseGain & Loss analysis - Conclusion Year 2008 compared to year 2007 (constant sample)

18. Product Range D&L June 2009

19. A swift reaction of Campbell Foods following the data presented in this analysis, allowed for them to launch a new variant of light mayonnaise in order to adequately appeal to those buyers previously buying the Kraft light (lemon) mayonnaise. Barely 4 months after they received this input, D&L light lemon mayonnaise could already be found at various retailers. If not for their local flexibility, they would not have been able to react this quickly to a changing market and profit from an unfulfilled need for a light lemon mayonnaise variant. Campbell FoodsProduct Range Mayonnaise Devos-LemmensJune 2009 Regular Mayonnaise Regular Lemon Mayonnaise Salad Dressing Light Mayonnaise Light Lemon Mayonnaise