Pedigree Growth Strategy (B)

Abstract

Julie Smith, brand manager for dog food manufacturer Pedigree, has to determine how best to jump-start growth in the slumping business. The (A) case centers on the debate over which type of strategy to pursue, brand building versus in-store activity, while the (B) case focuses on the concept of cause marketing as a growth strategy.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

2024 Sage Publications, Inc. All Rights Reserved

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Resources

Exhibit 1: Pedigree U.S. Financial Highlights

2003

2004

2005

2006

Category size (millions of lbs.)

10,008

10,208

10,413

10,621

Pedigree Share

   Share

15.1%

14.5%

14.2%

14.0%

   Volume (millions of lbs.)

1,511

1,480

1,479

1,487

   Wholesale price per lb. ($)

0.53

0.53

0.53

0.53

   Revenue ($ in millions)

801.0

784.5

783.7

788.1

   Cost of goods ($ in millions)

528.9

516.6

516.0

518.9

   Cost of goods ($ per lb.)

0.350

0.349

0.349

0.349

   Variable profit ($ in millions)

272.0

267.9

267.6

269.1

   Trade spending ($ in millions)

81.1

82.1

81.0

80.5

   Consumer promotions ($ in millions)

39.7

38.9

39.0

41.0

   Breeder sponsorships ($ in millions)

8.0

8.0

4.0

3.0

   Advertising ($ in millions)

62.0

57.0

63.0

65.0

   Overhead ($ in millions)

21.5

22.0

22.4

22.8

   Operating profit ($ in millions)

59.7

60.0

58.2

56.8

Note: The Pedigree financial information in this case was developed based on industry analysis for teaching purposes only.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

2024 Sage Publications, Inc. All Rights Reserved

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