Frito-Lay Dips

Frito Lay's Dips

Step One: SWOT Analysis for Frito Lay's Dips

Internal Factor Strengths Weaknesses

Management Have very good arguments for both opportunities in the marketplace. Doesn't utilize advertising to their potential. Can not agree on what avenue to take in the dip market.

Offerings Carries a wide range of products in the dip category. Introduction of cheese dips boosted sales. Products mostly shelf stable which constitute 45% of prepared dips sold in supermarkets. Recent offer of their first product that required refrigeration and 55% of prepared dips sold in supermarkets required refrigeration. Has only introduced one sour cream dip. Still hasn't penetrated all of the areas in the dip market.

Marketing Uses a variety of techniques such as product sampling, coupons, and TV and radio. Placement of dips in the store (near the salty snacks). TV and radio advertising or consumer-pull marketing is limited. Advertising/Sales ratio is 2.7% while the typical ratio is 10%.

Personnel Sales and delivery personnel have a unique system and they work well together. Large sales force of over 10,000 individuals. The unique system is particularly suited to the nonchain outlets. Chain-store outlets, most supermarkets, require a Regional or Divisional manager make decisions which makes sales and account servicing in these stores time-consuming and complex.

Finance Excellent growth up until the most recent year. Sales dropped from 1984 to1985. A new product introduced in 1986 is forecasted to boost sales. Large companies are entering the dip market and financing more advertising and marketing than Frito Lay's currently uses. More marketing and new products are needed to keep sales growth.

Research and Development Excellent when the cheese dips were introduced in late 1983 to early 1984. More new products need to be introduced and research needs to be done to find out which products will be most popular and profitable.

External Factors Opportunities Threats

Consumer/Social Brand name is very recognizable. Dips are always used in social situations and the types of dips produced are always expanding. New competition by large companies will require more unique products and more marketing efforts.

Consumer household penetration flattened leaving opportunities for competitors to take business.

Competitive As said above, Frito-Lay is a well-known brand of salty snacks. New dips products to differentiate Frito-Lay from the competition. Frito-Lay has a large variety of dips but there are still opportunities in the dip market that they haven't penetrated. A large variety of dip products have already been introduced into the marketplace.