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Zenith Case Analysis

Essay by   •  May 13, 2011  •  1,179 Words (5 Pages)  •  1,335 Views

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1. How might one segment the dog food market?

The dog food market can be divided into four segments: dry, wet, semi-moist, and dog treats. Dry dog food makes up 63% of the total market. Consisting of either small pellets or larger chunks of food, it is characterized as chewy and well rounded compared to canned and moist foods. In this sense, dry food provides more bang for the buck because it is cheaper than the pricier alternatives. Dog Chow is the leading producer in this category with 23% of the share.

The wet category accounts for 17% of the market share for total dog food. Canned dog foods consist of about 75% moisture and 25% solid materials, and are usually marketed as a complete or supplemental dog food. Six producers split the wet food market; the top producer claims 18% and the next five top producers split 72% of the total market, all of them claiming between 16% and 13%.

Semi-moist dog food accounts for only 2% of the total dog food market. It comes in either chunk of patty form and contains 75% solid materials and 25% moisture. They also don't require refrigeration and are produced to look tempting to the human eye. Kibbles and Bits is the well-defined leader of this category, accounting for 69% of the semi-moist dog food share.

The fourth segment is dog treats and claims 18% of the market share for total dog food. While they have a wide variety of ingredients and are delicious, they are not recommended as a complete food.

2. How should Show Circuit be positioned?

The newest segment of the dog food market that Show Circuit wants to market is the frozen category. More expensive and harder to store than other categories, frozen products are intended to appeal to dog owners who view their canine less like a household pet and more like a member of the family. These customers will spend more on dog food because they feel that their dog deserves the best meal possible because it is a member of the family. The ideal market Show Circuit should target is composed of dog owners, either single or married between 21 and 54, and who earn more than $25,000 annually. This target market views their dog as part of the family since it participates in more humanly activities, like sleeping on the bed. Because dogs are members of the family, these dog owners spend more money on food, toys, and various pet supplies.

Show Circuit should position their product as the best dog food available on the market at any price and the obvious choice for any dog owner who loves their dog enough to call him a member of the family. For the frozen dog food concept to make an impact on customers, Show Circuit needs to concentrate on product identification when introducing the product and coupons to entice dog owners to purchase the food. The advertising and packaging should emphasize the quality of the product and its unique qualities.

3. What potential exists for Show Circuit Dog Food?

There are several reasons that Show Circuit may be successful in the venture. First of all, the population of owned dogs in the US is 65 million. This number is steadily growing and is expected to keep growing in the future. Second, the growing popularity in buying dog food that is tailored towards the dog's health at grocery and pet stores has led to fewer owners feeding dogs people-food for dinner. Third, dogs are viewed as members of the family in a large portion of households and this has increased the amount of dog supplies purchased by dog owners to $20 billion annually. The fourth trend is the increase in premium dog foods that are higher in price; this increase has led to higher dog food sales as well as increased dog ownership.

In order to estimate the product's potential success, marketers need to identify reasons for potential failure. First of all, it is the most expensive dog food to prepare and pet owners are typically price sensitive. Another hurdle is

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