Title
Hill’s Pet Nutrition
AnalystsAbenaa AmpratwumMylissa BlanggerBrian CostelloMike GeromeHeather McKnightBen Perkins
AGENDA
• Brief Background Problems
• Internal Analysis
• External Analysis
• Recommendations
MissionMission Statement
Our mission is to enrich and lengthen the special
relationship between owners and their pets by providing the best pet nutrition in the world.
BackgroundBackground
• Dr. Mark L. Morris Formulated Hill’s Science Diet more than 60 years ago.
• The Company was Inspired by a Guide Dog.
• Parent Company Colgate Palmolive
• Hill’s is currently following a niche strategy
• Two Product Lines- Hill’s Science Diet & Hill’s Prescription Diet
Problems
Problems• Losing market share in our niche market
• Narrow product line relative to competitors
•No presence in retail food markets
•Saturated niche market
•Lack of effective advertising campaign
SWOT AnalysisSWOT AnalysisSWOT AnalysisStrengthsStrengths
•Support vet schoolsSupport vet schools
•Top seller in veterinary clinicsTop seller in veterinary clinics
•Experienced workforce (vets)Experienced workforce (vets)
•Brand imageBrand image
•Company reputationCompany reputation
•Better product quality versus competitorsBetter product quality versus competitors
SWOT Cont’dSWOT Cont’dSWOT Cont’dWeaknessesWeaknesses
•Narrow product lineNarrow product line
•Not distributed to retail food storesNot distributed to retail food stores
•Low brand awarenessLow brand awareness
SWOT Cont’dSWOT Cont’dSWOT Cont’dOpportunitiesOpportunities
•Expand product line Expand product line
•Gain market share from growth marketsGain market share from growth markets
•Steal market share from existing high Steal market share from existing high volume areasvolume areas
•Increase brand awareness through media Increase brand awareness through media outletsoutlets
SWOT Cont’dSWOT Cont’dSWOT Cont’d
ThreatsThreats
• Loss of sales to substitute productsLoss of sales to substitute products
• Increasing intensity among competitionIncreasing intensity among competition
• Brand image could suffer due to new Brand image could suffer due to new product linesproduct lines
US Pet Food Market Share 1998
Alpo 7%Others 10.6%Friskies 28.5%Purina 24%Heinz 18.1%Kalkan 11.8%
US Market Trends and Forecasts
Other 21%Dog Food 48.1%Cat Food 30.9%
US Pet Food Market Segmentation .(market share)
US Market Trends and Forecasts
Market forecast
0
2000
4000
6000
8000
10000
12000
in millions
Growth is continuous at 0.1% per year
US Pet Food Market Forecast (1999-2004)
DistributionUS pet food sales by retail type for 1997* ($ mil)
Grocery store 5,365 Mass market 1,418 Pet specialty store 1,403
Distribution
Distribution SurveyDistribution SurveyWhere do you buy pet food?
54%38%
3%
5%
SupermarketPet storeVetOther
Brand Recognition
Brand Recognition Survey
Brand Recognition
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Hill's ScienceDiet
No
Yes
Are you familiar with these brands of pet food?
Consumer AnalysisConsumer Analysis
35%
25%
20%
15%
5%
IngredientsVet RecommendationTasteBrandPrice
What is most important when choosing a brand of pet food?
Porter’s 5Porter’s Five Competitive Forces
HIGHRivalry Among
competing Sellers
High Barriers to
Entry
ModerateBuyer Power
LOWThreat of
Substitutes
HighSupplierPower
Perceptual MapPerceptual Map
MARS Inc.
IntroductionStrategyStrategy•Introduce new cat/dog product lineIntroduce new cat/dog product line
•Hill’s GeneralHill’s General
•Placement in mass retailersPlacement in mass retailers
•Specific regions Specific regions
•Competitive pricesCompetitive prices
•Keep Hill’s nameKeep Hill’s name
Dog top 5
29%
29%
15%
15%
12%
NYCLASASCPhila
Dog Food: Top 5 MarketsSales in Millions
Integrated Resource Inc. 1998
Dog growth
29%
19%
9%
15%
28%
SARaleighMISSATLSC
Sales in Millions
Dog Food: Top 5 Growth Markets
Integrated Resource Inc. 1998
Cat top 5
33%
29%
13%
13%
12%
NYCLAPhilaBostonBalt/DC
Cat Food: Top 5 MarketsSales in Millions
Integrated Resource Inc. 1998
Cat growth 5
32%
25%10%
15%
18%
Miami/FLSAJacksonPITTORL
Cat Food: Top 5 Growth MarketsSales in Millions
Integrated Resource Inc. 1998
StrategyStrategy Continued
•AdvertisingAdvertising
•TelevisionTelevision
•RadioRadio
•MagazinesMagazines
•InternetInternet
•Promotions Promotions
•CouponsCoupons
•Direct mail/Informational PacketsDirect mail/Informational Packets
•Free SamplesFree Samples
•Pet SeminarsPet Seminars
Strategy ContStrategy ContinuedStrategy Continued
•SponsorshipsSponsorships
Society for the Society for the protection from cruelty protection from cruelty towards animalstowards animals
•Dogs ShowsDogs Shows
HILL’S GENERAL
Introducing
Available in a Supermarket near you
Thank You
Thank You