Pillsbury is a leading food brand that prepares dough products, baking mixes and flour. It has loveable characters such as the Jolly Green Giant and the Poppin’ Fresh doughboy which make the brand easily identifiable on the shelves of supermarkets against its competitors’ products, such as Nestle. However, as technology has advanced and people are moving at a faster pace around supermarkets, brand is not something that consumers highly value these days, since most people when shopping would get a product that is cheap or convenient and would not pay much attention to the brand. Thus, the well-known characters on the Pillsbury products are not regarded with much importance anymore to a customer who just wants a product and can get it for a low cost and easily access the product.
This results in Pillsbury having to find new ways to sell products and be profitable in a competitive environment that has changed from what the company initially started off, where it was more focused on its strategy solely on creating strong brands marketed directly to its consumers. However, since brands are given less importance, this strategy will be unsuccessful in its current environment. To be competitive and a leader in food products Pillsbury would have to re-examine its operations and create a new strategy that will allow it to be in a position of competitive advantage (1). Customers currently see Pillsbury as just being an average company and since Pillsbury wants to be a leader in the market it would have to show customers that it can be the best. As any firm would not be satisfied with where they currently are as they would always need to evolve and adapt to the ever-changing competitive environment. For Pillsbury to truly change it’s strategy it would firstly have to look at what its competitors are doing and compare to see the activities and what resources or advantages it is providing its customers (1). This way Pillsbury would have knowledge of the cost structures in other firms and could use this as a benchmark for its own costs incurred in the firm, so that it can aim to have lower costs or that equal to its peers. Pillsbury needs to respond to its changing environment in a successful way or risk losing out its market share. Since most purchasing decisions are made in store, Pillsbury would have to pay more attention on working more closely with its customers and providing more value to them, so that customers see them as more than just an average firm. Customers would value Pillsbury if the products provided and services given are different from Pillsbury’s competitors. The retailers would value Pillsbury if Pillsbury was to provide something unique to them that none of the other competitors are currently providing retailers. This way Pillsbury could gain customer loyalty and have a stronger alliance with its customers. A clear need for a strong alliance is shown as both Pillsbury and retailers are facing a new environment and have new competition that is forcing them to re-examine their current operations. Due to new competitors and consumers demands changing there is a need to adapt to these new factors in order to remain competitive. Pillsbury has extensive databases with consumer demographics and the retailers would have their own system to show where most sales occur and during what periods, this would allow Pillsbury and the retailer to gain in-depth knowledge and understanding of consumers demands and therefore efficiently use this knowledge for their maximum benefit. This would result in lower costs for both the parties as it would reduce certain activities that aren’t essential (e.g produce less in months where consumers wouldn’t buy as much) and would also allow both parties to exploit the linkages in their value chain (1).
Pillsbury would have to shift from its traditional functions to one that would optimise its entire value chain so that it could decrease costs and also provide value to its customers. It would