As Brill, I would have authorized the request to introduce Healthy Berry Crunch in France because I believe that its advantages are more as compared to its disadvantages in these circumstances. To start with, the interest of healthy breakfast foods has grown tremendously in France. After carrying some test studies in six French cities for Healthy Berry Crunch, it was found that about 64 percent of the population had an intention to purchase the Healthy Berry Crunch while an exceptional number considered this as a new product. In Germany and Benelux, the test results also revealed that their people favored Healthy Berry Crunch. These results indicate that the trend of the industry is shifting to healthier food giving UC an opportunity to enter these markets. In addition, the EU has lessened its marketing, practicing and labeling regulations thereby presenting another opportunity for UC to venture and dominate the market.
Another competitive advantage for UC is that there is only one competitive product in France known as the Kellogg’s Special K and this gives UC a fast follower or second mover advantage. Therefore, UC ought to launch this product as first as possible to counter Cereal Partners that are also willing to launch Berry Burst Cheerios in the same market. Regarding the 10 to 15 percent savings in all costs of Europe, the introduction of Healthy Berries Crunch will compensate the total launch cost in France which is approximated to 20 million dollars. More so, involving innovation has been the focus of UC Way policy and the introduction of the Healthy Berry Crunch in France will follow this central value. Finally, UC Company should not wait for more for full-scale test because its 2 million dollar budget will not support the testing costs or else it will lose a chance to gain the market share of the fruit-based cereal.
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Q2
It is advisable for Brill to authorize Healthy Berry Crunch launch as Euro brand. Introducing Healthy Berry Crunch as Euro brand will immensely expand the country managers’ responsibilities because a lot of cross country relationships will be needed putting UC employees closer and making it a united European entity. This kind of idea will result in a shift in the existing structure in the company, which is always a vertical structure with a long channel of authorization. Secondly, the launch of Eurobrand could also result in a significant loss of UC way which is basically a ‘Listen to customer’ policy. The company is also required to test the Healthy Berry Crunch across all countries in Europe to establish if their products are accepted across Europe or not. The launch of Healthy Berry Crunch in France will amount to an average of 20 million dollars which exceed the budget of the company. To add up, some of the managers in the company have differed in opinions with regard to this strategy.
It is important for Brill to launch the Euro brand plan because it will assist UC to earn money as well as connecting other European countries. It is therefore recommended for UC to first introduce the Healthy Berry Crunch in France to test the market for Euro brand approach. This will enable UC to also compete with Cheerio’s Berry Burst, another competitor in France. After succeeding, it will proceed to launch the product in other European markets such as Germany and Benelux. The company should also conduct further research on other countries and select countries that reveal good results to be next after France launch. The company ought to pay attention to the recovery of Spain and if there are positive test results, its product can be launched next in the country.
The issue of too much cost as indicated by the company will be dealt with by three years savings that will compensate the associated launching costs. The issue of local customization that is causing differences in the company’s market strategies and product profiles will be solved by the converging consumer tastes across Europe. Finally, it is of significance for the company to change the current organizational structure to support Euro brand strategy. This will lead to the success of the company and further help European nations to easily link, become closer and understand each other.
References
Bartlett, C. A., & Carlson C.(2015). United Cereal: Lora Brill’s Eurobrand Challenge.
Ghemawat, P. (2007). Managing differences: The central challenge of global strategy. Harvard Business Review , 85 (3), 58-68.
