Licensing

1
Imagination Farms Growth and Diversification in
Fresh Produce
Licensing Branding
Kids Health Challenge
Case Problem
Imagination Farms
Recommendations
Conclusions
Uthra Raghunathan
Florence Santos
2
Players
Home

• Disney Consumer Products
• Imagination Farms
• Co-packers/licensees Co-packers/licensees
  Co-packers/licensees Co-packers/licensees

3

• Problem
• Increase penetration or scope of market
• Keeping Disney Garden idea fresh

• Outline
• Case Problem
• Kids Health Challenge
• Licensing Branding
• Imagination Farms
• Recommendations
• Conclusions

Home
4
Consumer Trend
Home

• Convenience is the number one food trend
• Purchase of convenience foods has increased 50
  percent
• There is a growing demand for fresh, healthy and
  functional foods.
• SOURCE NPD, AC Nielsen Homescan, U.S. Census
  Bureau, Perishables Group Fresh Facts

Health Challenge
Marketing Food
DCP
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Overview of Childrens Health Challenge and
Marketing Food to Children
Home

• 1/3 of American children and youth are obese or
  at risk of becoming obese.
• Low intake of fresh fruit and vegetables among
  children
• Negative effects of food marketing on childrens
  diets

Health Challenge
Marketing Food
DCP
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Marketing food to children
Home

• Be part of the healthy family solution
• Using the power of Disney

Health Challenge

• Delivering innovative products that are kid
  friendly, reassuring to moms, funtastic and
  great tasting
• Websites that help kids learn about healthful
  eating and exercise

Marketing Food
DCP
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Disney Consumer Products
Home

• Dedicated to promoting healthy kids
• Ranks 1st in worldwide sales of licensees
• Growth in Food and Grocery licensees

Health Challenge
Marketing Food
DCP
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Branding Issues in Fresh Produce

• Seasonality
• Inconsistent quality

• Limited Profit Margins
• Lack of Product Differentiation

Branding
Licensing

• Source Perishables Group Fresh Facts

9
Licensing in fresh produce

• Problems
• Risk of diluting or degrading the brand
• Poor business relationship with licensees

Branding

• Benefits
• A cost-effective way to enter a new market for
  DCP
• I-farms success rests on achieving consistent
  quality produce from its licensees/co-packers
• I-farms has
• 21 licensees/co-packers in the US
• 12 in Canada and 10 in Mexico

Licensing
10
Imagination Farms Profile
Home

• Kid and parent friendly national fresh produce
  marketing company
• Three Main Lines
• Conventional Fresh Produce
• Organic Fresh Produce
• Value Added Products
• Commitment to innovative products and food
  quality
• Industry originator

Imagination Farms
Strengths Concerns
Objectives Benchmarks
11
SWOT Analysis
Home
Imagination Farms
Strengths Concerns
Objectives Benchmarks
12
Opportunities
Home

• Diversification
• Increase the organic line
• Create new value added products
• Increase Market Share in US
• Increase fresh and value added products
• Increase Licensees
• Marketing
• Creative packaging
• Increase health awareness
• Tailor marketing and packaging for different
  ethno groups and geographical regions

Imagination Farms
Strengths Concerns
Objectives Benchmarks
13
Benchmarks
Home

• Problem
• Increase penetration or scope of market
• Keeping Disney Garden idea fresh

Imagination Farms
Strengths Concerns
Objectives Benchmarks
14
Benchmarks
Home

• Increase Licensees Co-packers by 50 by 2010
• Increase Market Penetration and Scope by 70 by
  2010
• Increase Value Added Product line
• Maintain Product Quality
• Maintain Product Affordability
• Continue to be kid and mom tested

Imagination Farms
Strengths Concerns
Objectives Benchmarks
15
Recommendations
Marketing
Diversification
Market Shares
Home
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Diversification
Recommendation

• Expand Organic Fresh Produce Line
• Growing Health Trends
• 71 of US consumers are part of the organic world
  (Hartman group)

Organics
Value Added
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Diversification
Recommendation

• Increase Value Added Products (VAP) Line
• VAP accounts for 10 of total produce sales
• Imagination Farms and DCP has the opportunity to
  be the market leader
• VAP Produce up 4.6, while total produce
  department experiencing 3.3 sales increase

Organics
Source Perishables Group Fresh Facts
Value Added
Source Nielson, 2007
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Creative Packaging
Recommendation

• Convenience and packaging key for VAP growth
• Colorful packaging for kids
• Convenient product for moms
• Marketing strategy should focus on how VAP
  products are differentiated

Packaging
Tailor Marketing
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Tailor Marketing
Recommendation

• Tailor Marketing for different groups
• Each race has particular demands, though some
  races tend to eat more fresh produce overall

Packaging
Tailor Marketing
Source Consumer Expenditures Survey, Bureau of
Labor Statistics
20
Tailor Marketing
Recommendation

• Tailor Marketing for different regions
• Each geographical regions has particular demands
  and pay different premiums

Packaging
Tailor Marketing

• Source Perishables Group Fresh Facts

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US Regional Sales Trend
Recommendation

• Performance and category makeup varies
  significantly by region and retailer
• Both the East and South Region have higher
  velocity sales than the total US

Regional Trends

• The East Region

Food Service
Licensees
Source Perishable Group Fresh Facts
22
US Regional Sales Trend
Recommendation

• The South
• High velocity sales for fresh cut fruit
• Higher share of unbranded cut vegetable items

Regional Trends
Source Perishable Group Fresh Facts

• The West
• More higher priced UPC-ed fresh cut items
• More new items, especially apples

Food Service
Licensees
Source Perishable Group Fresh Facts
23
Penetrating the food service industry
Recommendation

• 60 of consumers sometimes or always consider the
  availability of fresh produce on menus when
  deciding where to eat out
• Just 6 of consumers never eat fresh produce when
  dining out
• Foodservice fresh produce and fresh-cut demand is
  rising.
• Trend toward marketing healthier products to
  children
• Source Fresh Trends as cited by The Packer, Feb.
  20, 2006, Trends in the Marketing of Fresh
  Produce and Fresh-cut Products (Cook, 2007)

Regional Trends
Food Service
Licensees
24
Penetrating the food service industry
Recommendation
Regional Trends
Food Service
Source Industry Size July 2007, Technomic Inc.
as cited in Cook presentation (2007)
Licensees
25
Increasing the number of licensees/co-packers
Home

• Keep up with regional demands
• Cater and target demographic demands
• Increase number of differentiated products
• Ensure year round and regular supply of Disney
  garden to establish brand loyalty

Regional Trends
Food Service
Licensees
26
I-Farms Current Licensees
Home
Current Licensees
Projected Licensees
No Licensees
1 Licensees
Key Recommendations
3 Licensees
7 Licensees
27
I-Farms Projected Licensees
Home
Current Licensees
Projected Licensees
No Licensees
MaintainLicensees
Key Recommendations
Add 1 to Current Licensees
Add 1 New State
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Implications of Strategy
1.

• Increase Licensees Co-packers by 50 by 2010
• Increase Market Penetration and Scope by 70 by
  2010
• Increase Value Added Product line
• Maintain Product Quality
• Maintain Product Affordability
• Continue to be kid and mom tested

2.
3.
4.
5.
6.
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Key Recommendations
Home

• Diversify
• Intensify Marketing
• Increase Market Share

Current Licensees

• In 2010
• Renegotiate with DCP about serving large food
  chains
• Consider global expansion

Projected Licensees
Key Recommendations
30

• Thank You
• Any Questions