Name Yashwanth Dhanaraj

Question 1

Write your answer here.

The main differences between the market research processes are:

• The research for the fresh pasta and sauce was a BASES 1 study.

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The research for the Whole Grain Pizza was a BASES 2 Line Extension Study

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The market research for the Fresh Pasta did not include any actual taste testing of
the products whereas the Whole Grain Pizza Line included an in-home product

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usage test.
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• The market research for Fresh Pasta was conducted across several cities, but the
market research for the Whole Grain Pizza was constricted to just seven cities (high
potential markets) across the United States
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• Existing customers of TruEarth (pasta) were surveyed for the Whole Grain Pizza
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research, whereas for the Fresh Pasta, the people surveyed were all non- customers.
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The market research for the WholeGrain Pizza was more robust as
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• They understood where the customers were geographically and narrowed down on

high potential markets

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• The existing data from the refrigerated Pasta research gave a better insight to the
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market

• They included emperical and qualitative data ( taste tests and home usage tests)
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Question 2

Write your answer here.

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Insights into Exhibit 7

• Exhibit 7 shows us that a higher percentage of existing TruEarth customers will be

open to try the Whole Grain pizza than non- customers.
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•
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Exhibit 7 shows that the existing customers of TruEarth liked the idea of fresh pasta
better than the non-customers.

• Value wise, exhibit 7 shows us that existing TruEarth customers valued the wholegrain
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pizza more than the non-customers.

Comparing Exhibit 7 (total people surveyed) and Exhibit 3

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• Comparing exhibits 7 and 3 we can infer that a higher percentage of the total people
surveyed would open to trying the Pasta rather than the pizza.

• Comparing 3 and 7, the people total surveyed liked the idea of the fresh pasta better
than the idea of the wholegrain pizza.

• Comparing exhibit 3 and 7, the total people surveyed found better value in the fresh
pasta more than the wholegrain pizza. The customers rated the pricing of Fresh Pasta
better.

On the other hand, taking just the existing customers of TruEarth surveyed for the Whole
Grain Pizza. We can see that they were more open to trying the pizza and liked the idea
better than the Fresh Pasta, but they rated the pricing of the Fresh Pasta better as well.

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Question 3
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Write your answer for Part A here.

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The predicated sales revenue for the Whole Grain Pizza considering the worst-case scenario
would be 9.9 million dollars.
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The two major factors helping us determine the worst-case scenarios are
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• Penetration rate of the Cucina Fresca

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• Quality of the product which affects the repurchase rate

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Taking into account Eckstein’s suggestion that the penetration value ranging from 5%-15%,
for the worst-case scenario we are considering the penetration value of 5 percent.
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Similarly, the repurchase rate of the product is taken to be 21% (from exhibit 5) as the
worst-case scenario is delivering a mediocre product with a lower repurchase rate

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Paste the excel for Part A here

Non-
Customers
Customers
Definitely would buy 15% 26%
% of "Definites" who actually buy 80% 80%
"Definite" Purchases 12% 21%

Probably would buy 39% 53%

% of "Probables" who actually buy 30% 30%
"Probable" Purchases 12% 16%

Trial Rate ("Definite" + "Probable") 24% 37%

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Target households (MM) 58.8 58.8

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Penetration, % of target households 95% 5%

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Awareness of pizza product 12% 50%
ACV distribution 40% 40%

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Adjusted Trial Households 0.6 0.2
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Total trial households (Non-Customers +
0.9
Customers)
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% of households repurchasing 21%

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Repeat purchase occasions

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Total purchases (Trial + Repeat)

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Retail selling price $12.38

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Retail sales revenue $15.2M

Retailer gross margin 35%
TruEarth sales revenue $9.9M
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Write your answer for Part B here.

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Similarly, the revenues for the best-case scenario would be 19.4 million dollars, based on the
two factors that influences it. We have taken the maximum possible penetration rate of 15%.
The reasoning is that Eckstein believes that the market penetration varies from 5% (worst
case) to 15% (best case), so we have taken the best possible value.

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Identically, we assume the product wholegrain pizza to be an excellent product that inspires a
49% repurchase rate(table5).

Paste the excel for Part B here

Non-
Customers
Customers
Definitely would buy 15% 26%
% of "Definites" who actually buy 80% 80%
"Definite" Purchases 12% 21%

Probably would buy 39% 53%

% of "Probables" who actually buy 30% 30%
"Probable" Purchases 12% 16%

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Trial Rate ("Definite" + "Probable") 24% 37%

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Target households (MM) 58.8 58.8
Penetration, % of target households 85% 15%

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Awareness of pizza product 12% 50%
ACV distribution
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Adjusted Trial Households 0.6 0.6
Total trial households (Non-Customers +
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Customers)
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% of households repurchasing 49%

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Repeat purchase occasions

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Total purchases (Trial + Repeat)

2.4
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Retail selling price $12.38

Retail sales revenue $29.8M
Retailer gross margin 35%
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TruEarth sales revenue $19.4M

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Question 4

Write your answer here.

The two pizza categories that TruEarth will compete with are

• Take out/Delivered Pizzas

• Refrigerated Pizzas

Advantages of TruEarth over the competitors:

1) The quality attributes of TruEarth Pizza are higher than the competition
2) The audience felt that the quality of the ingredients that were used by TruEarth is

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better than the competition

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3) TruEarth is considered to be healthier option to the customer than the competitors

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Disadvantages of TruEarth over the competitors
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I. The variety of options offered to customers were limited compared to Takeaway
pizzas
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II. The making of a TruEarth pizza is less convenient than ordering takeaway or eating at
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a restaurant
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III. The takeaway/restaurant pizzas fare better in usage attributes and taste attributes
than TruEarth.
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Question 5

Write your answer here.

The Whole Grain Pizza is not appropriately priced for the customer.

I. Amongst the people who held unfavorable views of the product, the table below
shows at 45% found the product too expensive and 23 % felt that TruEarth was more
expensive than Takeout/ Restaurant Pizza. So, 68% of them named pricing as the key
reasoning behind their unfavorable purchase intent

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II.
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Even amongst those who held a favorable purchase intent, only 9% gave good pricing
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as their reason
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III. The most suggested feedback from both the audience who held favorable views and
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unfavorable purchase intent was to lower the purchases. 26% of them favorable to the
product wanted lower prices and 35% of them unfavorable to the products wanted
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lower prices.
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IV.
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The average retail price of the TruEarth Pizza is $12.38 (exhibit 10), which is more expensive
than even the Takeout pizzas and even the people favorable to the product were willing to

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pay only $10.75 for the product.

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In conclusion based on all the data presented, the pricing is not appropriate for the customers
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Question 6

Write your answer here.

I am in favor of launching the Whole Grain Pizza due to the justifications below

Quantitative Arguments:

• The market for refrigerated pizza was 5.8 billion dollars compared to the 4.4 billion
dollars market of refrigerated pasta in 2007.
• With the large capital expenditures already made, the incremental investment for the
Whole Grain Pizza was substantially lesser.

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• The company needs 12 million dollars in revenue for the pizza line. With the best-case

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scenario giving us 19.4 million dollars and the worst-case scenario giving 9.9 million

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dollars, the upsides are massive to ignore.

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• There is a high purchase intent of 60% amongst the surveyed
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Qualitative Arguments:
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Pizza demand in key demographics have been hurt due to health concerns and
dietary restrictions to cut out carbohydrates, this gave TruEarth the perfect opportunity
to launch the product as a healthy pizza.
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• TruEarth will be the first to the market, beating Rigazzi’s product launch and will get a
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jump on the market before them.

• The customers will have awareness of the pizza products as they have already tried
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TruEarth’s products before. They brand awareness will help in better market
penetration.
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• American consumers love pizza and would prefer not to cut it out of their lives which
presents a good opportunity to capitalize on
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