New Product Development at Schwan Food Company- Innovation through Communication
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Case Details:
Case Code : MKTG082
Case Length : 17 Pages
Period : 1952-2003
Pub Date : 2004
Teaching Note : Available
Organization : Schwan Food Company
Industry : Food & Beverages
Countries : USA
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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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Excerpts
The Need for Product Innovation
The US pizza business had grown at a healthy pace since its inception in the 1960s (Refer Exhibit V for information on the pizza business till the 1960s). In 1985, pizza was ranked as the fifth most popular food in the country. By the late 1990s, the industry was growing at 8% per annum with yearly sales of $2 billion.
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In 1999, pizza became the most popular food in the US. Significantly, of the four broad segments, dine-in, take-away, home-delivery and frozen, the last was growing at the fastest rate. In fact, frozen pizza was growing the fastest within the entire US frozen food industry (Refer Table III for information on frozen food industry trends and Table IV for a comparative look at frozen pizza segment's growth).
The reason behind the fast growth of the frozen pizza segment was the introduction of the 'rising crust' technology in the mid 1990s. By using this technology, it became possible for customers to get restaurant/take-away/home-delivery quality pizza at home...
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The Red Baron Style of New Product Development
While it was true that competition made it important for Schwan to focus on developing new offerings, there was another factor that fueled its decision to launch a truly innovative product. The company was quick to realize that the single-serve segment lacked a good quality, convenient and universally appealing product...
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Innovating its Way into the Future
Though detailed information on the sales performance of Red Baron Stuffed Pizza Slices was not available in late 2003, media reports indicated that customers had taken to the innovative and convenient product in a major way.
Some analysts believed that the slices could be a major revenue generator for Schwan in the near future. Meanwhile in November 2003, Schwan revealed plans to double overall sales by 2008. This was to be done on three fronts - globalization, product innovation and marketing... |
Exhibits
Exhibit I: The Spirit of Innovation Awards - Judgement Criteria
Exhibit II: Schwan Food Company - Product/Brand Profile*
Exhibit III: Schwan Food Company - The Structure
Exhibit IV: A Few Products from the Red Baron Stable
Exhibit V: The Pizza Industry in the US - Early Days
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