Influencing Consumer Purchase Decisions: Campbell Soup's Tryst with Neuromarketing

            
 
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Case Details:

Case Code : MKTG292
Case Length :11 Pages
Period : 2008-2012
Pub Date : 2012
Teaching Note : Not Available
Organization :Campbell Soup Company
Industry : Consumer Packaged Goods; Condensed soups
Countries : US

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Background Note

Campbell Soup Company (Campbell) was a maker and seller of food products. The company had its head office at Camden, New Jersey, USA. As of November 2011, it was the largest soup manufacturer globally. It had a three-fifth share of the US wet-soup market, amounting to annual sales of nearly 2 billion cans. Campbell started as a tinning unit in 1869. It started manufacturing condensed soups in the late 1890s. As of 1904, the unit had annual soup sales of 18 million cans. In 1922, the unit was incorporated as the Campbell Soup Company. Campbell introduced its chicken noodle and cream of mushroom soups in 1934, tomato juice in 1938, and, cream of chicken soup in 1947.

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The company achieved annual sales of US$100 million in the early 1940s. For the year ended July 31, 2011, it generated net sales of US$7,719 million and net earnings of US$802 million.

Since the early 2000s, with its soup offerings already in the maturity phase of the product lifecycle, Campbell had been struggling to make people consume more of its soup. In the financial year (FY) 2002, Campbell's US condensed soup sales shipments reduced 5% over 2001.

In FY 2003, the same condensed soup sales shipments saw a further decline of 6% over the previous year. Again, in FY 2004, the product sales witnessed a decline of 2% due to 4% decrease in shipments. Even in FY 2008, the US condensed soup sales were flat when compared to the previous year. And, in FY 2010, the product category registered a 2% decline.

Experts attributed the weakening of Campbell's soup sales partly to increased competition and reduced consumption due to the downturn in the US economy since the latter half of 2007. A study done by the Campbell in 2005 indicated that the company's advertisements which its previous surveys had suggested were consequential, had little influence over alterations in its sales.

Also, Campbell's managers faced certain constraints using the conventional consumer research methodologies. One, consumers did not have a concrete opinion on soups which could have resulted in their feedback being of consequence. Second, the consumers' actual buying patterns were not consistent with the correlation they had exhibited between ad remembrance and willingness to buy.

Campbell resorted to neuromarketing in 2008 to identify the factors that actually drove a consumer to buy its condensed soups, a category which contributed more than a billion dollars to its annual sales, and to make them more compelling.

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