Activia Grows Hcalthy .S.Sales When Groupe Danone launched Activia yogurt, it st

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Activia Grows Hcalthy .S.Sales When Groupe Danone launched Activia yogurt, it started a very successful marketing campaign, helping its revenues top $18 billion. Danone was already a major global force in the yogurt industry with brands like Dannon and Stonyfield Farm. Groupe Danone also marketed bottled water brands like Evian, and were looking to boost sales and profits when they developed Activia as the firm's leading yogurt for consumers interested in healthy eating. In recent years, consumers have been increasingly aware of the health implications of eating properly. In doing research, Danone found that many consumers were willing to pay premium prices for goods with special nutritional benefits. They decided to position Activia as a yogurt that aids digestion, thanks to patented probiotic bacteria. They also secured the right, based on the National Yogurt Association's standards, to say Activia has live and active bacterial cultures Activia's health message hit home with consumers and the brand became an instant success with sales over $100 million during the first year on the market. Activia was delivering $2 billion in sales worldwide and spearheading Danone's expansion into healthy foods. Today, the average per capita consumption of yogurt in the U.S. is 12 pounds. However, in Europe, where consumers are familiar with the health benefits of yogurt, consumption in Germany is over 15 pounds, and France over 40 pounds annually. Of course, Danone hopes the U.S. consumption increases which will mean increased profits for the firm. Danone is doing its best to stock U.S. supermarket shelves with numerous flavor and size varieties Despite challenging economic circumstances, competition, and charging a premium price, Activia h succeeded in boosting sales throughout the U.S. and Europe Danone targets consumers with television, print and online advertising about Activia and its health benefits and probiotics. I t also targets health professionals with messages including scientific studies showing the effects of probiotics on digestion and encourages these doctors to discuss the health benefits of yogurt with their patients. In fact, Danone has established 16 Danone Institutes to study nutrition and pursue health-related patents for new dairy foods. he company's biggest revenue generator and the Danone's dairy unit, including Activia, continue to be t driving force in its strategy of focusing on foods and beverages that enhance health and wellness. Danone has more y ogurt products in the works together with marketing communications to explain ho biotics promote a healthy lifestyle. What additional marketing activities does Activia need t drive more market share for Activia in the coming years? Describe the primary and secondary target market for Activia probiotic yogurt. What forces in t he marketing environment represent possible opportunities for Activia? What 2. es represent potential threats to the Activia brand? 3. What is Activia's value proposition? How can they use this in their marketing? 4. How can Danone and Activia build long-term customer relationships? Source: Principles of Marketing, Kotler and Armstrong, 02014

Explanation / Answer

1. The primary target market for Activia probiotic yogurt is the US market where Activia is doing its best to increase the profit through selling yogurt in numerous flavor and size varieties. The secondary target market is the European market including Germany and France where the consumers are familiar with the health benefits of yogurt.

2. The main forces in the marketing environment that provide opportunities for Activia include the consumer interest towards products with special nutritional benefits. The role of patented probiotic bacteria in Activia in digestion also helped Activia to get more opportunities in the market. People preferred consuming yogurt as a healthy practice which helped Activia in increasing its sales.

The potential threats to Activia brand include the challenging economic circumstances, competition and the premium price of the product.

3.The value proposition of Activia is the health benefits on consuming the yogurt and the effects of probiotics on digestion.

Activia display these benefits while advertising on television, print and online advertising to make customers aware of its health benefits and attract more customers. They also use the messages including scientific studies to show the effect of probiotics on digestion and encourage the doctors to discuss the benefits of using yogurt with their patients.

4. Danone and Activia can build long term customer relationship by selling products that enhance health and wellness. The people are more concentrated on health and wellness and are ready to pay high for healthy products. Danone and Activia can provide more yogurt products in many varieties to attract more customers and the marketing communication’s effort to spread the health benefits of Activia’s probiotics would help in adding more customers.

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