Product details

French food giant, Danone Group, is a world leader in bottled water and fresh dairy products by volume and second in biscuits and cereals, with a presence in over six continents. The group''s sales growth increased 8.1% from 13,024 million euros in 2005 to 14,073 million euros in 2006, of which Europe contributed 60.98%. Danone decided to roll out its tried-and-tasted product ''Activia'' - yogurt with an active probiotic culture - in the US in 2006. Americans ate less yogurt than Europeans, preferred fruit and vegetables and relied mainly on tablets and piles syrups etc. Dannon Inc (a US subsidiary of the Danone Group) faced a great challenge as the Americans'' food habits created a cultural battle due to minimal awareness of probiotics. Dannon invested heavily to help create awareness and generate a positive response to such cultural foods, and educate them about the health benefits offered by Activia. They initialised many promotional activities like: (1) direct mailing; (2) advertising on TV and radio; (3) a sponsored survey; (4) Internet marketing; and (5) free samples, etc. They had also faced difficulties in designing the packaging and bringing the advertising in line with the FDA (Food and Drug Administration) and FTC (Federal Trade Commission) guidelines. The case discusses American food culture, their foods, the shifting of eating habits and the impact of the FDA and FTC guidelines. Analysts were debating whether the tried-and-tested product rollouts really work everytime. Would it be possible for Danone to cultivate success based on targeting probiotics at a niche market? Can Danone continue to win the hearts of consumers through their troubled stomachs in the future?