marketing dilemma : scrambelicious vs trio

with the impending launch of the lower priced "scrambelicious", what ad will nestle go with for this brand? with its much lower pricing versus trio, scrambelicious will obviously be targeted against a broader socio-eco market, wider to include broad C and perhaps middle and upper D. this will need an ad that will appeal to the broader/lower socio-eco class.

but, they already have sharon cuneta for trio?! now, that can be a pain! sharon could have been perfect for scrambelicious. and certainly a kurot-sa-puso approach using the mega-star and mega-baby could have been a perfect fit for scrambelicious!

ok, ok, the brand name scrambelicious is certainly not appropriate for any kind of emotional or kurot-sa-puso ad, but there's gotta be a way to do it without turning the audience into neurotics. if not emotional, what about humor or the two megas singing to dial up cuteness and kilig factor? oh well, if it's the two of them, i still say it ought to be kurot-sa-puso.

the nestle ice cream marketing department is actually facing a brand portfolio issue with these two brands that have the same product characteristic of 3 flavors in one tub. the biggest issue will be the risk of canibalization. consumers will naturally compare scrambelicious and trio with each other because they have the same product concept. trio users will be most susceptible to that comparison.

unfortunately, with the significant pricing disparity between the two, scrambelicious being lower priced has the clear advantage. and when scrambelicious, a much lower priced and therefore generating lower margins and profits for nestle cannibalizes the market share of trio, a higher priced and with higher margins and profits, nestle will surely feel sorry they ever launched scrambelicious.

i am sure nestle has thought about cannibalization and what impact scrambelicious will have on the ice cream category profits. or did they?

i think the price difference between the two is too big to ignore for consumers. scrambelicious' retail price is 46% lower than trio's (based on the price printed on the lids of the tubs). if i am right in saying that the appeal of a 3-flavored ice cream is mainly value-for-money, then scrambelicious with its much lower pricing will be seen as giving the best value for money between the two. it's not only superior value for money that will be scrambelicious' strength, it will also be superior cash outlay. if i am right on those, scrambelicious will definitely kill trio in less than 2 years.

in the philippine market, value-for-money and in this case also superior cash outlay trumps celebrity endorsers, even if its the mega-star and the mega-baby.

not only will nestle face problems with consumers, they in fact might face problems even sooner - with their distributors and retailers. their distributors and retailers like supermarkets and groceries will be very reluctant to carry a lot of trio once scrambelicious is launched into the market. supermarket and grocery owners know that low price and good value for money sell better with consumers. they will feel that trio will decline in market share and will be taken over by scrambelicious. if they think that, they will certainly reduce their inventory and sales orders of trio in favor of scrambelicious.

sure, the product managers will argue that the flavors in each product are all different from the other and therefore can justify the difference in pricing. but that's like asking consumers to read the fine print, they will gloss that over. and the same way that low pricing and value for money trumps celebrity endorsers, the same two things will trump flavor differences.

does it sound like this wasn't properly thought through by nestle? oh, yah, i did say that already.

given this interesting portfolio issue, brand positioning will be most key. getting that very clear for each will be the driver for differentiating the brands and therefore giving consumers a reason to buy both, not just one over the other. good strategic thinking and applied across all marketing components will be most key. they need to do this for each of the brand and the whole category.

there are solutions to these issues, of course, but that's for another long discussion.