Frito Lay Case Study
Summary-
Frito-Lay is a division of PepsiCo, a New York-based diversified consumer goods and services firm. Frito-Lay is a nationally recognized leader in the manufacture and marketing of snack foods. The company’s leaders in the snack industry include potato chips, tortilla chips, cheese puffs and pretzels. Frito-Lay not only had net sales in 1985 of three billion but also captured about thirty three percent of the snack foods sold in the United States.
When Frito-Lay first got into the dip industry they introduced two dips, the Jalapeno Bean Dip and Enchilada Bean Dip. These two dips were generally viewed as a complement to the companies Fritos corn chip. In 1978 a Picante Sauce Dip was introduced to complement the newly introduced Tostitos chips.
These three dips were the only Frito-Lay dips sold until 1983. The growing dip popularity accelerated the extension of the dip product line in 1983. In the early 1984 Frito-Lay introduced a number of cheese-based dips all of which were produced in the same nine ounce cans as the Mexican dips were sold. According to the marketing director Ben Ball “Cheese dips were a extension of Frito-Lay’s tortilla chip business and were a response to the Mexican food phenomenon sweeping the country.”
From 1983 to 1985 the Jalapeno Bean Dip and Picante Sauce Dip showed steady although slow growth, despite this they were dropped from the Mexican Dip line in mid-1985 as a result of falling sales. When the line was dropped Frito-Lay anticipated that consumers would switch to the other types of Mexican dips that were sold, but the consumers did not and Frito-Lay ended up losing customers. Nevertheless, dips were a highly profitable product line.
Prior to line until the introduction of the cheese dips in late 1983. After the introduction of the cheese dip line, Frito-lay began promoting all of their dips, but almost all of their marketing efforts were steered toward retail-store snack food buyers in the form of trade-oriented
Frito-Lay is a division of PepsiCo, a New York-based diversified consumer goods and services firm. Frito-Lay is a nationally recognized leader in the manufacture and marketing of snack foods. The company’s leaders in the snack industry include potato chips, tortilla chips, cheese puffs and pretzels. Frito-Lay not only had net sales in 1985 of three billion but also captured about thirty three percent of the snack foods sold in the United States.
When Frito-Lay first got into the dip industry they introduced two dips, the Jalapeno Bean Dip and Enchilada Bean Dip. These two dips were generally viewed as a complement to the companies Fritos corn chip. In 1978 a Picante Sauce Dip was introduced to complement the newly introduced Tostitos chips.
These three dips were the only Frito-Lay dips sold until 1983. The growing dip popularity accelerated the extension of the dip product line in 1983. In the early 1984 Frito-Lay introduced a number of cheese-based dips all of which were produced in the same nine ounce cans as the Mexican dips were sold. According to the marketing director Ben Ball “Cheese dips were a extension of Frito-Lay’s tortilla chip business and were a response to the Mexican food phenomenon sweeping the country.”
From 1983 to 1985 the Jalapeno Bean Dip and Picante Sauce Dip showed steady although slow growth, despite this they were dropped from the Mexican Dip line in mid-1985 as a result of falling sales. When the line was dropped Frito-Lay anticipated that consumers would switch to the other types of Mexican dips that were sold, but the consumers did not and Frito-Lay ended up losing customers. Nevertheless, dips were a highly profitable product line.
Prior to line until the introduction of the cheese dips in late 1983. After the introduction of the cheese dip line, Frito-lay began promoting all of their dips, but almost all of their marketing efforts were steered toward retail-store snack food buyers in the form of trade-oriented