Bowl Appétit! Marketing Strategy

1. Bowl Appétit!Marketing Strategy Brian Bolten Pat Campbell Elizabeth Chang Trent Edwards Todd Federman Butch Lincoln

2. Outline • Data Collection & Analysis • Strategy Development • Concept Development

3. Data Collection & Analysis Insights from Lifestyle Trends • Insight: Shelf stable lunches need to be quick to prepare • Average American spends <15 minutes preparing meal • Insight: Food should be as tasty and nutritious • Insight: Market exists for “meal preparation kits” for busy working people who enjoy some preparation • Insight: Products need to be simple to understand • Learning: Convenient meal category is highly competitive but growing • Movement from meal components to finished meals

4. Strategy Development Target Consumer • Primary: White collar professional worker • Prepared in the workplace • Kept in stock at home for quick meals • Secondary: Stay-at-home mom with little time to cook

5. Strategy Development Qualitative Discussions Survey revealed two key concerns: • Overall Product Quality/Taste • Skeptical about taste of microwaved dry noodles • Serving size may be too small • Convenience • Some not comfortable boiling food in microwave • Not convenient for home users • “Why not just buy frozen”

6. Strategy Development Competitive Analysis Survey asked consumers to compare Bowl Appetit to four “quick preparation” competitors based on price, taste, nutrition and convenience Bowl Appetit VS. competition Price: Average Taste: Poor Nutrition: Average Convenience: Poor

7. Strategy Development Conjoint Analysis Results • Survey: Questionnaire to evaluate meat additive, wet noodles, price sensitivity • Survey Results: Wet noodles are significantly preferred to dry. Price and meat packages not significant. • Conjoint analysis and qualitative discussions indicate that consumers are willing to pay between $2.50 and $3.00 for a high quality shelf-stable product

8. Strategy Development Takeaways/Success Factors

9. Strategy Development Marketing Strategy • Marketing Strategy • Become product leader in shelf-stable single-serve meals category focusing on the attributes of on-the-go convenience and good taste • Value Proposition • Develop the first shelf-stable products that match the taste and nutritional requirements of white collar workers, while providing the speed/convenience demanded by a growing portion of this group

10. Concept Development Concept #1 – Flavor Bowls • Bowl of wet pasta or rice or dry potatoes is packaged together with a seasoned sauce (i.e. marinara, meat sauce, cheese sauce, chicken in teriyaki sauce, gravy) • Add seasoned sauce to the bowl & heat • Included utensil will add convenience • The sauce and larger portion size will enhance quality and hunger satisfaction • Improved graphic design of the product will signal convenience and quality

11. Flavor Bowl Mock-up • Bowl would contain noodle package and seasoned sauce

12. Concept Development Concept #2 – Flavor Meals • A three-section bowl includes a seasoned sauce, wet pasta/rice or dry potatoes, and dry vegetable product • Sauce is a hearty blend of spices, vegetables and seasoning • Empty pouch contents, add water to vegetable & heat • Included utensil will add convenience • The hearty sauce and larger portion size will enhance quality and hunger satisfaction • Improve the graphic design of the product to promote convenience and quality

13. Concept Development Promotion Strategy • Celebrity chef spokesperson to promote its convenience and quality taste • Free samples in urban areas & offices to increase “word of mouth” advertising • Money back guarantee to encourage first-time buyers to purchase the product • Billboard ads on subways and buses to target the busy white-collar professional • Trade promotions (e.g. end-of-aisle displays) during the product’s introduction phase

14. Concept Development Distribution Strategy • Rank of importance: • [1] Supermarkets • [2] Mass merchandisers (multi-pack) • [3] Drug and convenience stores • Educate the grocer of industry “best practices” • Convince grocers to introduce a “prepared food” aisle (e.g. “Convenience Aisle”) to improve convenience for the shopper • Leverage supplier power • Secondary, utilize GM Foodservice’s advantages to bring product to targeted customer’s environment: • Corporate cafeterias and vending machines

15. Concept Development Pricing Strategy • Position the product as the premium shelf-stable product in terms of quality, convenience and portion size • Set selling price higher than Bowl Appétit! • Position the product as a convenient and less expensive alternative to frozen lunches with minimal difference in quality of taste • Set the selling price slightly lower than the floor price for frozen foods. Target Price $2.69

16. Concept Development Switching Logic • At Work Preparers • Consumers who prepare frozen food or soup/noodles at work (easiest target) • Lunch Packers • Consumers who require speed and convenience, but have been unable to find products with desired quality/taste • Restaurant Goers • Consumers who desire speed and convenience, but go out to lunch because they require better quality/taste (most challenging target)

17. Concept Development Competitive Response • Most likely scenario • Frozen food competitors re-emphasize quality • Shelf-stable competitors commit to improve quality (through acquisitions or increased R&D) • Successful introduction may attract new players • General Mills’ strategy • Quickly attract & earn consumer loyalty in target segment • Focus on leading taste and convenience factors • Plan new flavors and combinations on regular basis to maintain trial & meet consumer’s changing tastes

18. Concept Development 3-Year Pro Forma:Model Results