TRUEARTH HEALTHY FOODS: MARKET RESEARCH FOR A NEW PRODUCT

INTRODUCTION
CASE ANALYSES:
TruEarth was founded by Gareth DeRosa in 1993 in St. Louis. He saw a rapidly growing
demand for sauces and pastas which were made from whole grains and natural, ingredients
better in quality than the ones being used currently. Initially, they took an informal approach
to product development, using their intuition to develop new products. However, the
estimations made by the company were not consistent with the actual trends and
calculations. Company was either underestimating the success of a product and found itself
struggling with increased demands or overestimating which frustrated the retailers. Later
they released limited-edition variations in different test markets. Eventually, they developed a
four-step process for research and development where new ideas would be screened and
tested through their limited focus groups. Then the promising products would undergo a
quantification of volume test process using the Nielsen BASES I&II.
In late 2004 TruEarth developed a product, the Cucina Fresca line of whole grain precooked
pasta and sauces. They tried to exploit the latest trend in home meal replacements. These
products were put through the Nielsen BASES I&II .Based on the findings from the testing
process, the company decided to launch the products.
The line was rolled out in 2006. Their pasta line was successful at exploiting the first mover
advantage and quickly gained the lead in that market segment. However their main
competitor, Rigazzi Brands, launched its own whole-grain fresh pasta a year later. The two
brands have been competing for market share ever since. The initial success of the Cucina
Fresca brand was mainly due to TruEarths groundbreaking efforts in launching the product
before the competition.

The management now wants to adopt a similar approach with the whole grain pizza concept
and feel that their established consumer base and brand image will help them in penetrating
the market. The pizza business presents a great opportunity with an annual sales of $53
billion in 2007 and 33% of restaurant-goers showing a strong interest in whole grain crust.
However, identifying the correct market for the sale of whole grain pizza, estimating its size
and business potential will be critical in determining its probability for success.
Research objectives should include determining the potential brand penetration for this
product, identifying consumer preferences viz the price and product attributes, market
share in this category, and sales forecasting. A sensitivity analysis would then have to be
conducted using these figures to account for various demand scenarios.
The research which has been done for the pizza concept so far includes estimates of
awareness and purchase behavior, mall intercepts and home trials to gain insights into
purchase intent, attributes, target price, substitution, consumer likes and dislikes etc.
The decision to launch this product can be taken after carefully evaluating the reliability and
validity of the numbers. Also, the various possible outcomes have to be evaluated. A proper
analysis has to be done on the information provided. Moreover, Cucina Frescas popular
brand image and loyal customer base will act as critical factors for the success of the new
product launch. Also, minor improvements in the product itself, can be vital in determining
the success of the launch.

SWOT
STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

Successful launch of
Cucina Fresca
allowed company to
establish market
share and
distribution network
Strong position
within niche market

Market Potential
forecasting Small
relative market share
within readymade
meals

New product offers a

different approach to
ready-made pizza

Big player
competition from
Nestle and Kraft MI
based Riggazi, is
equally matched
within niche Frozen
pizza market is
saturated and
market growth is
slow

RECOMMENDATION:

Launch the pizza

Lower the price slight to meet consumer preference.
Rigazzi va. Cucina Fresca blind taste test.
Focus distribution in super markets like whole foods, fresh market,

BREAK-EVEN: