Terra Chips Case Study

Terra chips

Summary

Introduction

I - S.W.O.T. analysis

II - Market trends

III – Positioning strategy

IV – Marketing Mix

V – How to achieve competitive advantage by using

psychological pricing

VI – Value-based pricing

VII – Buyer's perception of high quality purchase

VIII – Innovative distribution channels to enhance the perceived

value

IX – Would Terra Chips be successful in other countries

X – What marketing steps would you recommend?

Conclusion

Bibliography

Introduction

TERRA CHIPS, a USA-based company, founded in 1990, offers a wide range

of vegetable and potato chips, which have created a new niche on the salty snack

market.

Terra has always had a tradition of creating masterful combinations of unique

vegetables with a variety of fabulous flavours.

So we are going to deal with this business case, in order to make you more

familiar with this company.

I) Swot analysis

First, to define the framework in which the company is evolving, a SWOT analysis

has to be carried out. Indeed, that will helps us find the internal variables of the

company (its strengths and weaknesses), that is to say those under the control of the

firm and the external variables (opportunities and threats) that the company has to

face.

SS

trengths

Company

· Trailblazer: They were the first to introduce vegetable chips on the US market.

· Position as the non-potato chips: They differentiate themselves from the

generic type of chips (potato chips).

· Rewarded at the 1993 NAFST's (National Association for the Specialty Food

Trade) trade show: This shows that the company is recognised by the

professionals.

· Money-savings: The firm has not done any advertising; they have been a

positive buzz effect. This is what is known as "Viral Marketing".

· Hard-core loyal consumers.

Product

· Pretty and multicoloured: Strong visual identity.

· Wide-range of tastes.

· Eye-catching product.

· Ingredients: Sodium, fat and additives-free.

· Luxury product affordable for people.

· Product with a badge value: Status?Maslow's hierarchy of needs.

· Product substitute to caviar and chips.

W Weaknesses

Company

· Narrowness of the product mix.

· Creating labels: This could cannibalize Terra Chips.

· Distribution of the products: They can't be bought everywhere and this might

discourage customers.

Product

· Fad product: they should have product in the pipeline to sustain sales and

profit.

· Exotic and uncommon taste in the USA: It may be more ordinary abroad, and

so, what is successful in the country of origin may be a failure in Asia for

example. Exports won't be easy.

O Opportunities