FEEDING THE CHILDREN WITH LOLA

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FEEDING THE CHILDREN WITH LOLA

Identification of product opportunities for the brand Lola in country Y and X

Author: Supervisors:

Marjan R. van Bergen Prof. dr. ir. A.C.J. de Leeuw and Dr. K. van Veen

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Management summary

The internship took place at the Company Z. During the internship the research project was part of the Lola project which identifies healthy and nutritious product ideas for children aged six months to twelve years old in country X and Y for the brand Lola.

This research helped to identify these product ideas. The goal of this project is:

The ‘policy supporting’ research will provide recommendations for healthy and nutritious product ideas for the brand Lola for child nutrition in country X and Y.

The recommendations and knowledge of this research project will be used by the project leader of the Lola project in country Y and x for identifying new product opportunities for the brand Lola in the market of child nutrition.

To achieve the goal two main questions were answered:

1. What are healthy and nutritious products that mothers will buy and children will eat for the brand Lola in country X and Y?

2. Which of the product ideas can be developed by Company Z?

The main conclusions of both questions will be described in the rest of this summary.

At the end of the summary the final recommendations are presented.

Main conclusions question one

The mothers that are studied live in country X and Y and have on average 297 US$ to spend a month for the whole family in country Y and 587 US$ to spend in country X a month for whole family of which they spend 70% on food. These consumers can not permit to make mistakes. Because the mothers need to buy the products for their children the motives of these mothers were analysed. To analyse the motives of mothers the means-end chain theory was used. The motives were analysed in three levels: values, benefits and products attributes (Chapter three). The results are presented in table 0.1.

Table 0.1 Motives of mothers

Values Benefits Product attributes

Valued as a mother Strong and healthy bones Vitamins Able to take care well of my

family

Healthy hair, skin and teeth Minerals Better future for my children Build resistance to diseases Nutrients Family harmony A fit and active body Taste

Growth and physical development

Made of fruit and/ of vegetables Improved digestion Natural ingredients

Financial capability

Extra energy Convenient

To understand the needs of the child, the development of children from birth to the age of twelve were studied through literature (Chapter three). Children up to the age of eight have a preference for sweet tastes, smooth textures and bright colours. Starting from the age of eight, they begin to like new tastes like sour and to show preference for other textures. Around the age of five children like preparing their own food or to help their parents with preparing.

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The conclusions of the consumer analysis were used as input for a brainstorm session.

The ideas generated were used to formulate ten product ideas. Table 0.2 presents the formulated product ideas.

Table 0.2 Product ideas

Name What does it offer?

1. Mum’s porridge Porridge with extra calcium that can be prepared within 5 minutes, has a sweet taste and smooth texture.

2. Fruity squeeze Natural fruit and provides vitamins. The product is packaged in a bear shape so children can play with it.

3. Healthy bar Bar made of fruit parts and popped grains, to eat as a healthy snack.

4. Pasta/ noodles Pasta/ noodles made of different flours and is prepared within three minutes.

5. Cereals Cereals made of different fibres and children can prepare themselves.

6. Cartoon shaped cookie Fortified cookie in a cartoon shape made of corn starch.

7. Ready-to-drink milky shake Fortified milky shake that children can drink when ever they want with a smooth texture and sweet taste.

8. Ready-to-prepare drink Sweet drink with a smooth texture that can be prepared within 2 minutes and is fortified with calcium.

9. Surprising porridge Porridge made of natural cereal fibres and can be prepared within five minutes. Surprising popping particles when put in mouth.

10. Fruity porridge Porridge with little fruit parts for extra vitamins.

The last step that was taken to answer the first question was to screen the product ideas on the fit with the associations consumers have with Lola in country Y and X (Chapter four).

Consumers in both countries associate Lola with tradition, family warmth, high quality, value for money and taking good care of your children. However opportunities for the brand are to become more nutritious, practical and fun for children to eat. More practical to prepare can be offered with instant products. But mothers in country Y perceive instant as not taking good care of their children. This has to be taken into account when screening the product ideas for country Y.

The product ideas were screened on these associations together with the products they thought could be added to the brand.

For country X the product ideas five, six, seven and eight were screened positive. Idea one not because this product idea already exists in country X. Product idea two, four and ten were not screened positive because consumers did not associate fruit and noodles/ pasta with Lola. Lastly, product idea three can be only be added to the brand Lola if it is presented as a cookie/ biscuit.

Product ideas five, six, seven, eight and nine were screened positive. Idea two, four and ten were not screened positive because of the same reason as in country X, consumers did not make the associations. Product idea three can only be added to the brand if presented as cookie/ biscuit. Product idea one and nine are positively

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associated only with a remark. Because these product ideas are instant or easier to prepare more research needs to be conducted about mothers and instant products before a final statement can be made.

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Main conclusions of question two

To answer question two the means of the formulated product ideas were screened on the capabilities of Company Z (Chapter four). R&D has six focus area’s: biosciences, taste & flavour, texture, nutrition, food processing and consumer science. The outcome of this screening was that all means could be made feasible, theoretically, by Company Z.

Recommendations

The answers of both questions are used to provide the following recommendations to the project leader of the Lola project.

The product ideas five, six, seven and eight are recommended for Lola in country X.

These ideas fit with what Lola represents in country X, address the needs and wants of both consumers and can be developed by Company Z. Product idea nine was also positively associated but it is not sure how children will react on popping particles in their mouth, more information is needed. Idea three was also positively associated only research needs to be conducted about bars and Lola even before it can be presented as a cookie.

The product ideas five, six, seven and eight are recommended for Country Y. Also these product ideas are recommended because Company Z can develop them, the consumers can associate them with the brand without losing the positive associations consumers have and lastly because the products can fulfil certain benefits mothers are interested in. Product idea one and nine are not recommended because more research needs to be conducted about consumers and instant products before solid recommendations can be provided. Product idea nine is also not recommended because this research does not provide enough information about how children react on popping particles. More research needs to be done regarding this subject before this product idea can be recommended. Also product idea three is not recommended for the same reasons as in country X.

Recommendations for further research

One of the most important remarks that can be made about this research project is that all data gathered about the consumers is second hand. No contact was made between the researcher and the consumers in country X and country Y. This has to kept in mind when reading and using the recommendations. The results and recommendations should therefor be tested in a consumer research. This is my most important recommendation for further research, to check if the recommended product ideas really fit with what the consumers in country X and country Y need and want.

My second recommendation is that the product ideas should be screened on more factors to eliminate ideas that are not feasible because of other reasons. Factors the product ideas can be additionally screened on are: market potential, market need and product advantage.

The third recommendation is to formulate an agreement of joint department H-Lola projects because this was one of the initiating factors of this project.

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A question that rose during this research was ‘do the consumers, especially mothers, really want more convenient products?’. One source stated that convenience was not high on the list of consumer priorities however it was mentioned as one of the problems of Lola by the marketers in both countries. For the brand it is important to clarify this because this can break or make the introduction of products. Further consumer research is needed on this matter.

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Introduction

Lollypop formulated in 2000 a new strategy ‘achieve sustained growth by outpacing our rivals and increasing our share of consumer’s wallet’. Company Z wants to increase their annual growth to 5% - 6%. This growth can not be realised by focussing only on the high income groups in Europe and America. As part of this strategy Company Z also needs to become number one in developing countries.

One of the brands that could help realise this strategy is Lola. The recognition of the brand among people that are in the lower classes of society is about 80% in country Y and X. As Lola has potential to help realise this strategy the Lola project was started to identify new product opportunities for the brand Lola in the lower classes of society in Country X and Country Y. Lola is used in these countries to prepare porridge for children.

The research that I conducted during eight months contributed to this project by recommending new product ideas in child nutrition for the brand Lola in Country X and Country Y.

The first step that was taken in this research was to understand the interests of the different parties that could play a role in this research based on interviews. Based on the inquiry a research strategy is formulated. In the research strategy the considerations of how to conduct the research are discussed. The inquiry is described in chapter one and the research strategy in chapter two.

The focus of the research is the consumer in Country X and Country Y who has very little money and of that money it spends 70% on food. These consumers can not permit to make mistakes. The consumer analysis studies what mothers and children want with respect to healthy and nutritious food and beverages products but also the nutritional deficiencies that are present among children in those countries are considered. The idea of introducing new products for consumers is not only to earn money but also to help tackle the world health nutritional deficiencies in a structural way. In chapter three the consumer analysis is described.

To generate as much as possible ideas, I came up with the idea to organise a brainstorm session where the gathered information from the consumer analysis will be used as input. Using these insights a lot of creativity can help you generate new ideas during a brainstorm session which you can not generate by yourself. The ideas from the brainstorm session were analysed and used to formulate new product ideas keeping in mind the consumers. At that moment I theoretically formulated products that addressed the consumers needs and consumers actually would like to buy but something significant had to be done yet: Could Company Z develop the product ideas? To answer this question I analysed the capabilities of Company Z by interviewing people from research and development. But one step had to be addressed before the research could be concluded. The product ideas are recommended to the brand Lola in Country X and Country Y which is an existing brand. Consumers have associations with this brand. The formulated product ideas have to fit with the associations consumers have. This is the final step in the research so product ideas could be recommended to the Lola project. In chapter four these different steps are described.

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To structure the report in a way that suited the subject, the report is written as if a dinner is prepared for the consumers in Country Y and Country X. In each chapter a specific part of the creation is addressed.

I would like you to be my guest during the creation of the dinner and maybe even have you let a bite of at the end.

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Chapter one What shall I prepare?

When the internship started I did not have a clue of what to prepare, who my guests were etc. To prepare the right dishes and understand the guests, the research project started with an inquiry to understand the interests of the different parties that could play a role in the preparation of the dinner.

In section the original assignment is discussed and how the different parties thought about the assignment. In the second section the final assignment is described.

§1.1 Original dish

The internship took place at the department H. The internship was initiated by supervisor one, which is project leader of ‘Foods for life’. In one of his projects he addressed the market opportunities for product A in continent C. The result of this project was a method to extend shelflife of product A up to three months. Because of the promising results in continent A department H was interested in the potential to introduce similar products in country X and Y.

To understand the initiating factors of this research project interviews were conducted in the first two months of the research with people that could play an interesting role in this project and had certain ideas on what the outcomes should/ would be. For me these interviews were of great importance to be able to address the needs of the involved parties so the research project could add value.

During the interviews I faced several problems. First of all, not that many contacts were present in the Department H with the business of country Y and X which made it difficult for me to contact people. To overcome this problem, people were sent a mail where I introduced myself and explained why I would like to have contact with them.

Some people I could never reach and others were willing to talk with me. Based on the interviews the following information was gathered.

The business of both countries was not very interested in product A. According to Mr.

X is sold in Country Y but not by Company Z anymore. Company Z sold its business because it was not profitable.

Second, people in both countries do not mainly consume product A but lola which is sold under the brand Lola.

Another difficulty that rose during the interviews with people from both countries was that they did not understood what the contribution of department H and me could be because of the great distance and lack of experience with the market.

The interest of the business was very low but their support was needed.

Also some people from the department H were interviewed and they had a different point of view on what I should do than supervisor one. Some people found it more important that a project would be formulated between department H and the brand managers of Lola. In July 2001 they had visited the business manager of country X who is also responsible for Lola. In this meeting they talked about Lola of which the growth is declining but has great potential because of the high recognition among consumers. In this meeting was agreed that department H would help identify new opportunities for the brand Lola in Country X. Since the meeting nothing had

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happened and they thought that I could do this. They wanted me to build a business case for the brand Lola in Country X.

After these interviews I decided that the research had to be redefined because the original assignment could not add value for the business of both countries and the Department H. Second, no support was found from both sides only supervisor one’s support which was not enough.

§1.2 Chosen dinner

The research project had to be redefined in such away that it would encompass the interest of both parties, the department H and the Lola business of country X and Y.

To formulate this kind of research project the declining growth of the brand Lola in both countries was studied and the possible contribution the department H and I could deliver to help solve this.

§1.2.1 Lola

Lola is synonym for lola in both countries. Lola is a well-recognised brand and is used to prepare porridge for children. At the moment the brand Lola can be regarded as a cash cow ¹. According to the BCG matrix (Henderson, 1973) cash cows are products with a high market share in a steady market. The cash incomes are very high and no investments are made in the brand for new products or new marketing campaigns. This is true for Lola, the margins are very high and few new products have been launched in the last forty-five years. Some people even mentioned that in the hundred years Lola exists no investments have been made in the brand.

At the moment the growth of the brand is declining because the lola business is a dying business according to the stakeholders that were interviewed. The products that are sold under the brand Lola are perceived as very old fashioned. Consumers today prefer other products, e.g. products that are easier to prepare and/ or more modern.

Introducing new marketing campaigns or using new distribution channels will not change the fact that consumers perceive Lola as old fashioned according to the stakeholders and all these things have already been done in the past. It is time for Lola to undertake more daring actions.

It is not completely dark for Lola because it can contribute to the strategy Company Z formulated in 2000. Company Z wants to increase their annual growth to 5%-6%. This growth cannot be realised by focusing only on the high-income groups in Europe and America. As part of this strategy Company Z also needs to become number one in developing countries. Lola is one of the brands that could help realise this strategy because of the high recognition among the lower classes of society in Country X and Country Y, about 80%².

In 2001 a project was started for Lola to identify new product opportunities especially targeted at consumers in the lower social classes of society. The project is called Lola project.

1 Stakeholder interview: Mr. X, Former brand manager Lola

Brand Manager country X

2 Stakeholder interview: Project leader & brand manager country X

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Concluding, the problem with the brand Lola is that the products that are sold under the brand Lola do not completely fit to the consumer preferences. But the recognition of the brand is very high among the lower classes of society in Country X and Country Y. The brand Lola has the potential of contributing to the target ‘Become number one in developing countries’. Developing new products for the brand Lola can help realise this strategy. Developing new marketing campaigns or choosing new distribution channels does not change the problem that the products do not fit to the preferences of the consumers.

The Lola project is started to overcome the growth problem of Lola and to use the high recognition that is present among the consumers to help realise the strategy

‘Become number one in developing countries’.

§1.2.2 Department H

This sub-section will describe the contribution department H and I could deliver to overcome the declining growth of the brand Lola.

Reasons for department H to be interested in this research project are threefold. The first reason is that research conducted by the department H has to be brand-linked. The brand Lola is one of the brands for which department H has responsibility. At this moment no research is done for the brand by the department. Lola can provide opportunities for new research projects in the future. This is important because the existents of the department depends on research projects that are linked to a brand.

The second reason is the department have to contribute to the strategy. As mentioned in the former section, Company Z formulated a new strategy and to realise this also developing markets need to be targeted. Because the department is focused on developing countries and has responsibility for the brand Lola it could contribute to the overall strategy by formulating new projects.

Lastly, Company Z has formulated a nutrition policy of which the department is mainly responsible for implementing. The nutrition policy of Company Z states: ‘We strongly believe in nutrition and health as a key growth driver for our business. As a leader in the global food market, Company Z is committed to market great tasting foods that enhance the quality of life and help our consumers achieve the nutritional balance, in terms of both nutrient shortfalls and excesses. This requires us to be at the leading edge with our brands in delivering nutrition and health benefits.

Department H is responsible for implementing our nutrition policy. Company Z will:

• Develop a deep understanding of consumers’ nutrition and health needs and wants;

• Formulate products to meet consumers’ needs and wants, based on latest scientific insights, state of the art technology and sustainable sourcing practice;

• Undertake and support scientific research to provide evidence for product claims and communicate responsibly on this with consumers and health-care professionals;

• Interact with (non-)governmental organisations to enable appropriate claims for food products and raise awareness on nutrition and health issues and guidelines³.

3 Company Z Nutrition Policy Document

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Contributing to the Lola project can help realise this nutrition policy for which department H is mainly responsible for.

The reason for department H to contribute to overcome the growth stagnation of brand Lola is that there is a lot of knowledge and expertise on products for developing countries which can lead to new products for Lola.

A second reason for the department to contribute to overcome the growth of the brand Lola is their knowledge on health and nutrition. This knowledge can help to develop new products that will address the health needs of people in country Y and X.

Based on the analysis a proposal was written by me for the head of the department and the project leader of the Lola project. This proposal described in what way I thought I could contribute, together with the department, to identify new opportunities for the brand Lola in country Y and X. They both agreed that I, with help of the department, could play a role in the Lola project.

§1.2.3 The Lola project

The research project is part of the Lola project. The goal of the Lola project is to identify healthy and nutritious product opportunities for the brand Lola for child nutrition in Country X and Country Y. The products will be for children aged six months to twelve years old. The project is a regional study for the brand Lola. Besides the regional innovation there are some quick local win projects.

The Lola project is focused on consumers in Country X and Country Y. The consumers in Country Y are defined as those people classified in the C and D classes (Figure 1.1). This is 64% of the total population. The income of the consumers is between 204 US$ and 390 US$ a month (Table 1.1.). The weighted average is 297 US$. These incomes are for a complete family and not per person.

Figure 1.1 Distribution of the population of country Y in percentages Source: confidential

Table 1.1 Structure of the population of country Y and monthly income in US$

A 5%

B 19%

C 31%

D 33%

E 12%

A B C D E

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Class Distribution (%) Monthly Income in US$

A 5.0 2,300

B 19.0 960

C 31.0 390

D 33.0 204

E 12.0 110

Source: confidential

The consumers in Country X are defined as those consumers classified in the D and E classes (Figure 1.2). For the year 2000 the consumers represent

72.2 % of the total population. The income of these consumers is less than 942 US$ a month (Table 1.2). The weighted average is 587 US$ a month, which is much higher than the average income in Country Y. Also here accounts that the monthly income of consumers is for a complete family.

Figure 1.2 Distribution of the population of country X in percentages

Table 1.2 Structure of the population of country X and monthly income in US$

Class Distribution (%) Monthly Income in US$

ABC+ 13.0 > 3,141

C 14.8 3,036 – 1,047

D+ 28.9 628 – 942

D/E 43.3 0 – 523

This research project will contribute to the Lola project by providing recommendations for healthy and nutritious product ideas for the brand Lola. The recommended product ideas can be used by the members of the Lola project to develop products for the brand Lola in the market of child nutrition.

In this research project the same definition of consumers is used as in the Lola project.

The reason to choose the same definition is that this research project is part of the Lola project and to provide solid recommendations to the project.

The final report with the recommendations is in the first place for the project leader of the Lola project. Secondary level customers of the final report are the brand managers from Country Y and Country X. These people can use the recommendations as input

ABC 13%

C 15%

D+

29%

D/E 43%

ABC C D+

D/E

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for new product development in their countries for the brand Lola. Department H will not use the final recommendations but based on this research project new projects can be organised and new contacts built. Department H is the sponsor of the project.

The project is finally defined after three months even though not many people believed it could be realised. During the inquiry Supervisor one and the head of the department even said that I had to look for a new research project. I searched for new research projects but did not stop pushing the ‘old’ one and I succeeded and not because of the help of supervisor one. Supervisor one even stopped being my supervisor during the inquiry because he wanted to concentrate on is own work. After a couple of weeks I had a new supervisor. Supervisor two staid with me for the rest of the research project and was of great help.

It took me some time and hard work but I could finally start with the research project.

In the next chapter the recipe is described which will be used to create dinner for my guests.

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Chapter two The recipe

In this chapter the recipe that is used in this research to create the dishes is described.

The right ingredients and cooking utensils have to be chosen to create the dishes that the guests want to eat.

In the first section the broad goal of the research project is sharpened. The second section will address which recipe is chosen to prepare dinner. The chosen theories and models are discussed and the conceptual model is presented. Based on that discussion the main question of the research is formulated. The last part of this chapter will address the sub-questions and the chosen ingredients (sources) to answer the main question.

§2.1 Dinner

In the former chapter a broad goal was formulated for the project: ‘providing recommendations for healthy and nutritious product ideas for the brand Lola’. Based on the inquiry and the broad goal a main goal for this project, is formulated.

Main goal

The ‘policy supporting’ research will provide recommendations for healthy and nutritious product ideas for the brand Lola for child nutrition in country Y and X.

The recommendations and knowledge of this research project will be used by the project leader of the Lola project to identify new product opportunities for the brand Lola in the market of child nutrition.

Second level customers are the brand managers of country X and country Y which are part of the Lola project and can use the recommendations and knowledge of the research project as input for new product development for the brand Lola in the market of child nutrition in their countries.

Department H is also a customer of this project and will use the research project and the knowledge of the research project to initiate new projects and to build new contacts with the Lola business in country Y and X.

§2.2 How to prepare dinner?

To prepare the dinner the guests will love, two questions need to be answered:

1. Can the product ideas be sold in the market?

2. Can the product ideas developed by the company?

These basic questions need to be answered to achieve the goal of this research.

To answer the first question two aspects need to be addressed: the consumer and the market.

The consumer needs to buy the product. Only when the consumer wants to buy the product, because it fulfils needs and wants it is interested in, the product has potential.

This research must understand the needs and the wants of the consumers. In this research the consumer is the mother and the child in Country X and Country Y. These consumers are different consumers than we are. They earn on average 297US$ a

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month in Country Y and 587US$ a month in Country X and of that money 70% is spend on food. Second, the earned amount of money is not per person but for a complete family. These consumers cannot permit to make mistakes when buying food.

Besides the fact that these people have to think twice before they spend their money on food products, they have all kind of other concerns like the health of their children because of undernourishment and one-sided nutrition. This has to be kept in mind when analysing the consumers. Products ideas should be generated that help these consumers in a well considered way and not only use them to increase profit of Company Z.

Mothers is in these countries do the shopping and are responsible for the finance. The motives these mothers have when buying products for their children is the focus of the study. Besides the mother the research is focused on the child that consumes the product, what does the child like in food products. Children can have from a young age preferences for certain food. Second, if the child does not like the products the chance the mother buys it the next time is smaller. In this research only the child is seen as consumer and not as purchaser because the children in the lower economic classes in Country Y and Country X do not have the same amount of money to buy their own products.

The analysis of the consumer is the first step that is taken in this research to develop products and will be used as input to formulate product ideas that address the needs and wants of the consumers. But if these product ideas are really ideas for the brand Lola in not known yet.

The brand Lola is an existing brand in Country X and Country Y and consumers have already associations with the brand. Because the product ideas will be recommended to the brand Lola the product ideas need to be tested on their fit with the associations consumers have of Lola in Country X and Country Y. If all these steps are taken than the first aspect of the first question is answered.

The second aspect that needs to be addressed to answer the first question is the potential in the market. Only products that have a potential in the market will deliver profit to the company that sells the products. This aspect is not addressed in this research because this information is perceived as highly confidential by the marketers in Country X and Country Y, they did not want to provide me this data. Persuading the marketers was hard because of the long distance. Another reason this aspect is also not addressed is because of the limited time span of this research.

To answer the second question the capabilities of Company Z need to be analysed because that will be the company that needs to develop the recommended product ideas. To answer this question the capabilities of Research & Development (R&D) is analysed. If the capabilities are understood the product ideas can be screened and the second question is answered. By answering this question the product ideas can theoretically be developed by Company Z.

§2.3 Cooking utensils

To create the complete dinner I need to know what kind of food processors and spoons etc. I need to use. This section will outline the cooking utensils that will be

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used to create the dinner. The cooking utensils are chosen based on the analysis made in section 2.2.

First the chosen theories and models will be discussed. The second section will present the conceptual model. In the conceptual model the steps that will be taken in this research are presented. This model is also based on section 2.2 and the chosen theories and models. This section will end with the main question that needs to be answered to achieve the goal.

§2.3.1 Theories and models

This research project is part of the Lola project. To achieve their goal the Lola project uses the new product development model of Booz Allen & Hamilton. This model exists of eight phases of which the first phase, strategy, is already completed. This project is only part of the Lola project in the second and third phases. In these phases ideas are generated and screened. Because this model is used by the Lola project this model is also the basis of this project.

To answer the first question of section 2.2 consumer behaviour of the mothers is analysed. Consumer behaviour is defined by Wilkie (1990) as ‘the activities that people engage in when selecting, purchasing and using products and services so as to satisfy needs and desires’ (Wilkie, 1990: 12). According to Wilkie (1990) is consumer behaviour motivated behaviour and exactly this needs to be understand, the motives of mothers to buy products for their children.

Consumer motivation has ten key characteristics according Wilkie (1990):

• Consumer motivation has two major components: energy and direction;

• Consumers’ motives are both overt and hidden;

• Consumers are driven by tensions reduction;

• Consumers are motivated by both internal and external forces;

• Consumer motives have valence – they can be positive or negative;

• Consumers are motivated to achieve goals;

• Consumers have a thirst for variety;

• Consumers’ motivations reflect individual differences;

• Consumers desire order in the world;

• Consumers are guided by the need hierarchy (Wilkie, 1990: 173).

Of all these characteristics the last one focuses most on the actual content of motivated behaviour, the nature of the need. To understand the ‘need’ the means-end chain can be used. This theory analysis the motives of consumers at three levels:

• Values;

• Benefits

• Product attributes (Reynolds, 2001: 25).

Values are the mental representations of peoples underlying needs, after they have been transformed to take into account the realities of the world in which people live. Values are ideas of people what is desirable. The values people have depend on their culture and sub-culture.

The benefits help realise the values people have and can be fulfilled by a certain product. The product attributes is the lowest level and are the attributes of products that realise the benefits people are looking for in products.

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The means-end chain theory asserts that people act to satisfy underlying needs and these needs are in turn realistically represented by the values we hold. The result of behaviour is a being a means to an end. The three levels of the means-end chain are hierarchical in that they connect concepts at a more concrete level of meaning, the product attributes, to concepts at a more abstract level, the values (Reynolds et al., 2001).

By using this theory I can understand what motivates mothers when buying products for their children, which benefits they are interested in and which product attributes can realise this. Based on that information product ideas can be formulated that address the motives mothers have. Another reason this method is chosen is that this is a well- respected method within Company Z used by consumer research and known by the brand managers to whom I also have to present my final recommendations.

Normally the Laddering method is used to fill in the means-end chain. This method interviews the consumer face-to-face and tries to analyse together with the consumer the three levels of the means-end chain theory and connects them with each other. In this research the Laddering method is not used because it was not possible to have contact with the consumers in Country X and Country Y. This is explained in more depth in section 2.4. In this research the Health Focus Trend Survey (HFTS) is used to understand the motives of mothers and information of the marketers from Country X and Country Y. This source is also described more in depth in section 2.4.

The means-end theory is only used in this research to categorise the motives of mothers at three levels based on a consumer research that was conducted in Country X and Country Y. Also no connections will be made between the different levels because the used source does not provide this information.

Besides the mother also the child must like the product because it is the consumer.

This analysis has to understand the needs and wants of children aged six months to twelve years old regarding food. What I new from my study pedagogy was that children go through tremendous development and have changing needs. These changing needs can influence the needs and wants children have regarding food. To understand this I studied books about children’s development. The negative site of this was that is was mainly focused on cognitive and social development, which of course is very important but to far away of what I was looking for. During a discussion with someone of consumer science of department H two articles were given to me about the children as consumers⁴. These articles both described how children develop cognitive and social but also address what the implications are for consumer behaviour of children. This information suited better with what I was looking for. Of these articles I finally choose for the article of Valkenburg et al. (2001) because she describes consumer development of children based on well-respected theories of development and is more focussed on food and beverages related to children. The article of Roeder John is more focused on marketing and children as purchasers which are aspects that are not addressed in this research.

4 Articles: Valkenburg, P.M. & J. Cantor, ‘The development of a child into a consumer’, Applied Developmental Psychology, 22 (2001), p. 61-72.

Roedder John, D., ‘Consumer socialisation of children: A retrospective look at twenty-five years of research, Journal of Consumer Research, 26 (1999), p. 183-213.

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With the chosen article one remark must be made and this accounts for a lot of the literature that addresses the development of children as consumers.

The literature that describes children’s development as consumers mainly is based on the developed world, like Europe and Unites States. These countries/ states are characterised by affluent economies and highly commercial mass media. The marketing environment in developing countries is quite different and the general level of economic development is lower. Second the relationship between parents and children can be quite different⁵. Less addressed in the existing western literature is that a child may learn from more than only the parents regarding consumer behaviour. Especially in countries where this is still in development and children learn easier and sooner than their parents.

Another reason these theories have to be used with caution is that children can develop physically and mentally slower in developing countries because they maybe do not receive enough food. The stages children go through at certain ages can be different than suggested in the theories.

These factors are not addressed in the ‘western’ models of development of consumer behaviour which makes them less valuable to use for developing countries. But because no other models and theories are present to understand consumer development of children these models need to be used but treated with caution. I recommend that the results of this part of the research should be tested and not taken for granted.

These theories and models are used in this research. No theory is used to address the aspect fit with the brand Lola and capabilities of Company Z. These aspects will be analysed by using interviews and consumer research.

Second, I searched for theories and models that could help me analyse these aspects, like core competence theory of Prahalad & Hamel and the brand equity theory of Aaker, but these theories did not fit with the purpose I choose them for. They complicated the research instate of helping it make more clear.

I think that theories and models should only be used if they help you analyse the

‘problem’, if this is not the case the theory does not add value. Maybe I should have searched better and longer to find suitable theories and models but at a certain point in the research I think you must choose for something and start the analysis. This was especially true for my research project because it took me about three moths to create and define a research project. Of the total six months I had only three months to complete the whole project.

§2.3.2 Conceptual model

The conceptual model presents the steps that will be taken in this research (Figure 2.1).

The conceptual model is based on the former sections.

Article: Dholakia, R.D., ‘Intergration Differences in Consumer Behaviour: Some evidence from a Developing Country’, Journal of Business Research, 12 (1984), p. 19-34.

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Figure 2.1 Conceptual model

The first step that is taken is to analyse the needs and wants of the consumers, the mother and the child. In step 1A the means-end chain theory is used to understand the motives of mothers. To understand the needs and wants of children the theory of Vlakenburg et al. (2001) of development of children as consumers is used. The outcomes of the consumer analysis are used to formulate product ideas (Step 2).

Because the research project is part of the Lola project and will provide recommendations to this project, the product ideas have to be screened on their fit with the associations consumers have with the brand Lola in Country X and Country Y (Step 3A). In the last step, 3B, the ideas will to be screened if the product ideas can be developed by Company Z because that will be the company that will set the products in the market (Step 3B). If all these steps are taken recommendations can be given to the project leader of the Lola project (Step 4).

§2.3.3 Main question

So far is described how the goal will be achieved but no main question is formulated.

Based on the former sections the following main questions are formulated to achieve the goal.

Product ideas for the brand Lola in Country X and Country Y

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Product ideas for the brand Lola in country X and Y

(4) Motives of mothers

(1A)

Needs and wants of children regarding

food products (1B)

Product ideas that address the needs and wants of both consumers

(2)

Fit with the brand Lola (3A)

Fit with the capabilities of

Company Z (3B)

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Main questions

1. What are healthy and nutritious products that mothers will buy and children will eat for the brand Lola in Country X and Country Y?

Per main question several sub-questions can be formulated:

1. What are healthy and nutritious products that mothers will buy and children will eat for the brand Lola in Country X and Country Y?

A) What are the motives of mothers when buying and using healthy and nutritious products for their children?

B) What are the needs and wants of children regarding food products?

C) What are healthy and nutritious products that mothers will buy and children will eat?

D) What do consumers in Country X and Country Y associate with the brand Lola?

E) Which of the formulated product ideas fit with the associations consumers have with Lola in Country X and Country Y?

A) What are the capabilities of Company Z Research & Development?

B) Can the capabilities of Company Z Research & Development develop the product ideas?

§2.4 Ingredients

This section will describe the ingredients (sources) that will be used to prepare dinner.

The first and second section will describe the ingredients that are used to answer the main questions. This section will end with how reliability and validity is secured during the creation of the dinner because I do not want complaining and ill guests or a visit of the commodity inspection department.

§2.4.1 Sources that are used to answer question one

The sources that are used to answer the question ‘What are healthy and nutritious products that mothers will buy and children will eat for the brand Lola in Country X and Country Y?’ are described per sub-question.

A) What are the motives of mothers when buying and using healthy and nutritious products for their children?

To answer this question I thought of different sources:

1. Information from the marketing people of both countries;

2. Conduct my own consumer research in Country X and Country Y;

3. Health Focus Trend Survey (HFTS) conducted in Country X and Country Y;

4. Knowledge from the department on deficiencies among children in Country Y and Country X.

The first source could be realised although it took some time before the information was received from Country Y and Country X. The information from the marketers provided me information of who the consumers are, how they live and what they find

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important. This information is based on consumer research done in Country Y and Country X for the Lola project.

The idea to conduct a consumer research in Country X and Country Y was well received in April 2002. The plan was that I and supervisor two should go in May to Country X and Country Y. But this plan did not fit with the agenda of the managers in both countries and had to be delayed. A new plan was scheduled for the end of July but again this was not possible. At that moment supervisor two and I decided that the research should only be based on secondary information regarding the motives of mothers. Another reason we choose for this direction is because the internship would end half August and had to be completed. The source I used was the HFTS conducted in Country Y and Country X which was present at the department. The source HFTS will be described later in this sub-section.

The fourth source could be realised and provided information about deficiencies among children in Country Y and Country X. One of the contributions the department could make to the Lola project was to analyse the deficiencies that are present in these countries among children. This information can be used to develop products that address the concerns of mothers and to help tackle the nutritional deficiencies that are presented in the world. This information was gathered by asking two nutritionists to make a profile of the deficiencies. The profile is based on literature studies and information from nutritionists from Country X and Country Y.

Health Focus Trend Survey

Health Focus International is an authoritative resource for companies who need to understand consumer attitudes and behaviour towards health and nutrition choices.

The five primary objectives are:

1. To identify current issues in consumer health and nutrition behaviour and attitudes;

2. To asses the trends in consumer priorities regarding nutrition issues such as fat, calories, vitamins etc.;

3. To understand where shoppers are headed in their behaviour towards their health and diet;

4. To show what nutritional issues will be important over the near horizon;

5. To provide detailed data in regional and global differences/ commodities, and track trends worldwide⁶.

The Health Focus International Trends Survey has been completed in Latin America.

The respondents of the survey are primary grocery shoppers who are responsible for doing most or equally sharing the household shopping responsibilities. In country Y and X 1000 people were interviewed, aged 17 to 70 (500 per country). Of these 1000 people 79% were women. The interviews were conducted face-to-face.

The results of the survey are analysed for selected groups of respondents in Country Y and Country X to analyse the motives of mothers in this research. Two different groups were analysed:

1. Country Y:

- People with an income <249US$ a month with children 0-12;

2. Country X:

6 Presentation: confidential

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- People with an income <250 US$ a month with children 0-12;

- People with an income 250 – 834 US$ a month with children 0-12.

These groups were chosen because of their relevance for the project which focuses on consumers with children aged 0-12 years old in Country Y and Country X within certain income groups. Two groups were chosen for Country X because the defined consumer group is larger in Country X than in Country Y in the Lola project.

Data/ questions that are not relevant for this research are left out. A selection of the relevant questions was made by me and my supervisor. Together we selected the questions we thought would help us analyse the motives of mothers and formulate product ideas. The questions that are left out are more directed towards where people shop and how often, genetic modified food, sports, illness and obesity.

The data from the HFTS is used to analyse the motives of mothers. As 79% of the respondents were women in Country X and Country Y for this report it will be assumed that the respondents with children are mothers rather than fathers.

A second assumption made is that the data generated from the survey is also the actual behaviour of the consumer. The reason for this assumption is that what people say is not always the same as what they do⁷.

Some of the results of the HFTS should be treated with caution, especially the income groups with children, because for some questions the number of respondents in the groups is too low to be statistically significant. The reason for this is that some questions asked the interviewee to pick one reason/ statement out of ten. If not enough people are interviewed, the amount of people that have to choose one answer to be statically significant is soon to low.

B) What are the needs and wants of children regarding food products?

The answer this question I thought of the following sources:

1. Conduct my own consumer research;

2. Information about what children eat in these countries;

3. Literature.

Only source three could be realised. To conduct a consumer research with children and mothers was not possible as explained in sub-question A.

Second, information about what children eat in Country X and Country Y was not available. There is a lot of information available what people eat in Country Y and Country X but not specific about children. This information was also not present in Country Y and Country X with marketing, they were planning to do this consumer research in September 2002. This was to late for my research project. I also thought about the fact that children all over the world would have a same pattern of consumption and will eat at about the same age with their parents. But this is not true according to the nutritionists of the departement were I conducted my research. Based on this analysis I gathered the following articles and one book, which have some limitations as described in section 2.3.1:

1. Valkenburg, P.M. & J. Cantor, ‘The development of a child into a consumer’, applied Developmental Psychology, 22 (2001), p. 61-72;

7 Wilkie, W.L., ‘Consumer Behaviour’, John Wiley and Sons, 1990, New York

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2. Roedder Joh, D., ‘Consumer socialisation of children: A retrospective look at twenty-five years of research, Journal of Consumer Research, 26 (1999), p.

183-213;

3. Dholakia, R.D., ‘Integration Differences in Consumer Behaviour: Some evidence from a Developing Country’, Journal of Business Research, 12 (1984), p. 19-34;

4. Urbick, B., ‘About kids: Food and beverages’, Leatherhead Publishing, Surrey, 2000.

Of these articles and book I used mainly the article of Vlakenburg et al. (2001) as explained in sub-section 2.3.1. The book of Urbick (2000) and Dholakia (1984) are used in support of the article of Valkenburg et al.

C) What are healthy and nutritious products that mothers will buy and children will eat?

To answer this question I came up with the idea to organise a brainstorm session with as input the outcomes of the consumer analysis. Brainstorming is a method to foster intuitive thinking, where individuals are encouraged to use others’ ideas to trigger and develop their own (Bart & Hart, 1999: 223-224). I have chosen for a brainstorm session because more ideas would be generated than when I did the formulating by myself. Second, all the knowledge that is present within the department could be used to formulate ideas which is one of the reasons this project was initiated.

D) What associations do consumers in Country X and Country Y with the brand Lola?

To answer this question presentations were used from the marketers in Country Y and Country X. These presentations described the outcomes of consumer research conducted in Country Y and Country X for the Lola project and the Lola brand.

Also here it would have been very valuable to do a consumer research but the marketers in Country Y and Country X already did this and as mentioned this was not possible.

E) Which of the formulated product ideas fit with the associations consumers have with Lola in Country X and Country Y?

To answer this question the information of sub-question D was used to screen the formulated product ideas on their fit. More ideal would have been a consumer research test were the product ideas were tested among the targeted consumers. But this was not possible within the time scope of the research and these kind of resources were not available.

§2.4.2 Sources that are used to answer question two

The sources that are used to answer the question ‘Which of the product ideas can be developed by Company Z’ are described per sub-question.

A) What are the capabilities of Company Z Research & Development?

Sources that I used to answer this question are semi-structured interviews with people from Company Z R&D and internal reports. By using these sources a clear view was given on the capabilities of Company Z R&D.

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I choose for semi-structured interviews because the subjects and question points are known but it leaves room for flexibility. The flexibility is needed because subjects that were regarded as important before the interview can change during the interview. New ideas can be brought up during the interview by the interviewee that can be very relevant to the research. The internal reports are used as extra information besides the interviews.

B) Can the capabilities of Company Z Research & Development develop the product ideas?

To answer this question the capabilities from the former sub-question will be used to screen the product ideas.

§2.4.3 Reliability and validity

To conduct a reliable and valid research the following is done.

Reliability is defined, as ‘the results of the research have to be the same if the research would be repeated under the same conditions, repeatedly’ (De Leeuw, 2001). To make sure that the research would provide the same results when it is repeated the sources that are used are mentioned in a way that the information can be found again. The research will have a list of all the documents that are used, all the different databases that are accessed and the names of the people who are spoken to. Second, the steps that are taken in this research will be clearly described. By doing this I hope the information can be found back in a way that the research will provide the same results when conducted a next time.

Validity is defined as ‘that the research investigates what it really wants to investigate’

(De Leeuw, 2001). To make sure the research is valid the research proposal is worked out before the research is conducted. In this way it is clear what has to be analysed and in what way: models, theories, sources and measuring methods need to be used.

Second, during the analysis, processing and reporting, the research proposal will be used continuously.

§2.5 How will dinner be served?

This is the last section and will describe how dinner will be served to the guests.

The analysis and the results of the research project will be presented in a report which will be completed before the end of October 2002. This report will be distributed to the main stakeholders within department H, people part of the Lola project and the University. In this report there will also be a summary of the whole research project especially for the managers of the department and the Lola project. To make the report accessible for all the stakeholders the report will be written in English and technical terms will be avoided as much as possible. If this is not possible then the technical terms will be explained.

Second, a presentation of the main results will be given to the main stakeholders within department H and the Lola project.

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Chapter three The guests

In this chapter the preferences of the guests for whom the dinner will be created are analysed. The dinner will be served to children but their mothers must like it also.

The following sub-questions will be answered in this chapter:

• What are the motives of mothers when buying and using healthy and nutritious product for their children?;

• What are the needs and wants of children regarding food products?

The first section describes the motives of mothers regarding healthy and nutritious products they buy and use for their children. To analyse the motives of mothers the three levels of the means-end chain theory are filled in based on the HFTS and the knowledge that is present within department H. The analysis will start with the values mothers have in Country Y and Country X and will end with the product attributes that can realise the benefits mothers are interested in.

This section is mainly an analysis and an enumeration of relevant data from the HFTS and department H. This can be tough for readers that are not interested in these facts or have little knowledge about health and nutrition. This is especially true for section 3.1.3.2 ‘Knowledge department H’ were all kind of different vitamins, nutrients and minerals are described. Readers that are interested but want a quick overview of the analysis are advised to read the summaries present after each section.

The second section outlines the preferences of children because they are the consumers of the dinner. The preferences of the children are analysed by using the theory of Valkenburg et.al. (2001) about development of children as consumers. At the end of this section also a summary is provided for the ‘quick’ readers.

One last remark before you can read the rest of the chapter. Keep in mind when reading this chapter that the sources that are used to analyse the guests are secondary sources. Second, that I have never met the guests that are invited to dinner which are from a different culture and have a different background.

§3.1 What do mothers want to give to their children?

The mothers are also present at dinner and have to be content with the dishes. The reason the mothers need to be content with the dishes is because the mothers can buy the dishes afterwards. Second, they have to feed their children with the different dishes and will only do this if they like the food. To realise this the motives of mothers are analysed to create dishes that mothers want to give to their children. The motives of mothers are analysed using the means-end chain theory in three levels: values, benefits and product attributes. These will be described in this order.

§3.1.1 Values

The information about values is based on presentations from marketers that are part of the Lola project in country X and country Y.

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One of the main characteristics of consumers in both countries is that they generally live in extended families in enlarged homes or compounds. In these extended families two or more generations share the same roof. Living this way allows them to achieve the self-sufficiency and the total wellbeing that would be difficult to achieve in another situation. Living inside extended families makes the consumer feel not alone and motivates them to help others that are less fortunate. The consumer refer to themselves as the middle classes and have the feeling that there is always somebody less fortunate.

The highest education level that is reached by the father of the family is usually elementary and high school. The education level for men and women is respectively 7.5 to 7.0 years. The main professions of the men are drivers, chauffeurs and jobs in the informal sector, i.e. jobs not registered so people do not have the right to social security.

The main role of women is to be a mother. The mother is responsible for the good functioning and cohesion of the family. Her main activities are the care and education of the children and the domestic work of the home. The mother wants her children to have a better life than she does. Some mothers also work but blame themselves for not taking care of their children. But most of the time these mothers do not have a choice.

If the mother works out of home another family member takes care of the children.

The housewife is considered the main person that buys the food. About seventy percent of their income is spent on food. The mother is considered as the administrator of the economic resources of the family. Because she is responsible for the shopping and the budget is not that large she does not want to worry about the finance and wants value for money.

Summary

Based on the analysis that is made in this section the first level of the means-end chain can be outlined. The values mothers have in country Y and country X are:

1. Family harmony;

2. Able to take care well of my family;

3. Better future for my children;

4. Valued as mother;

5. Financial capability.

§3.1.2 Benefits

This section discusses the benefits mothers are interested in. To understand the benefits two questions from the HFTS were analysed:

1. When thinking about your children how concerned are you about your children’s health and the following?;

2. Which of the following health benefits are you interested in when buying and using products?

One way of understanding the benefits mothers are interested in is by knowing their concerns. Mothers were asked ‘When thinking about your children how concerned are you about your children’s health and the following?’. The concerns of mothers are presented in table 3.1.

FEEDING THE CHILDREN WITH LOLA