General Mills Inc. Sales and Marketing

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General Mills, Inc., also known as General Mills, is a multinational manufacturer of packaged goods that are distributed to customers worldwide. The firm has a large market share since it manufactures the majority of its products in around 16 countries and sells these and other finished consumer goods to over 100 countries. The company's headquarters are in Minneapolis, Minnesota. Furthermore, it is one of the firms in the United States with a large number of employees (up to 43,000 as of May 2014). (MarketLine, 2016). General Mills earned $17,909.6 million in profits for the fiscal year that concluded in May 2014, a 0.8 percent improvement from the previous year. Since its foundation General Mills Inc. has aimed at serving the world by making people food products that are healthy. The company has made this mission achievable by putting customers first, building a creative organizational culture, making food with passion to earn the trust of consumers as well as treating the world with care. Through innovation the company has launched a number of cereal products in the market that has put it at a competitive edge in the market; as a result, its market share has elevated over the last few decades.

Products

General Mills is one of the most popular international producers and sellers of branded food products to consumer, marketing its merchandise in more than 100 nations. The company provides abroad range of consumer products in the form of ready-to-eat cereals, refrigerated yogurt, meal kits, soup, shelf stable and frozen vegetables, grain frozen pizza, ice creams, among others. These products are offered under various premium brands including Gold Medal, Cheerios, Yoplait, Nature Valley, Pillsbury, Haagen-Dazs, Old El Paso just to name a few (MarketLine, 2016). All these brands have established a good position in the market having one of the greatest share in the world market with Gold Medal being the most sold in the US.

General Mills Inc. has decided to launch a new product called Classic Trix with six synthetic colors. Even though it is often important to stay healthy, other times consumers may just prefer artificial flavoring in foods. General Mills has now considered this idea and planning on bringing back synthetic flavoring even after consumers complained about it in Trix cereals some years back. Accordingly, the company is scheduling to start marketing Classis Trix by October 2017.

Even though there are differences in thoughts among consumers regarding the introduction of artificial colors on cereals, the successful sale of the product will considerably bank on the marketing strategy. Besides, pricing strategies, the structure of the sales organization matters a lot in attracting the customers and remove negative impression they have concerning addition of synthetic colors in their cereals.

Classic Trix

Classic Trix is a bright rainbow form of Trix cereal brand with artificial flavor and colors. After a strong market study and research regarding synthetic colors and flavors, General Mills Inc. has decided to bring Classic Trix back to the market. The decision to have synthetic colors was motivated by the aspiration to fulfil the desire of consumers who crave for synthetic colors and flavors in food.

According to General Mills Inc. representatives they have received calls and emails from their consumer on complains about selling more of natural colors and flavors which has become depressing to them. However, both forms of Trix will be available in the market to take care of consumers who prefer healthier feeding and love natural flavor to synthetic foods. Classic Trix has in the past one and half years been out of the market because of the bad feeling from consumers regarding its fake components that most vegetarian were against. Consequently, to help the product fetch enormous returns in the market, General Mills Inc. ought to adopt new and advanced marketing and pricing strategies that are feasible in the current dynamic food industry. Additionally, a good sales force and structure will considerably pay to the company in the long-term.

Target Market

The rich flavor and high-quality product (Classic Trix) among others offered by General Mills Inc. will only apply to a specific market in the industry. A critical identification of the target market for a product is essential to the success of General Mills by developing suitable marketing and pricing strategies for Classic Trix. Owing to their different brands offered to consumers, General Mills targets a wide variety of markets with different age and ethnic background. In regards to their cereal product line, General Mills Inc. mainly targets the children mostly relating to the white race in middle class.

However, breakfast cereals are also consumed by adults in the developed countries who have no time to prepare meals in the morning. Accordingly, the company’s target market for this product is both adults with main focus on children who need nutrients such as sugar, vitamins, fibre, sodium and sweeteners. Furthermore, the box that contains Classic Trix meal has a cartoon drawn which targets the young generation. Children have a close association with toys and cartoons; therefore, this will interest many kids who will impulse parents to buy them this breakfast cereal boxes. Therefore, the prospect consumers for Classic Trix will mainly be the Generation Y between the age of one to six years old. Nonetheless, it is evident that adults who belong to Generation X and Y are also possible target market for the synthetic colors and flavors available in Classic Trix.

The consumption of breakfast cereals in the US and other parts of the world strongly correlates with household income. Both low income and middle income earners are prospect consumers of Classic Trix. The company should target the whole ethnic group in America since cereal is recommendable to all children and adults with specific nutrition requirements for their growth and development. However, since the US has a greater population of whites this is the major target market for this product in terms of ethnicity. Also, those individuals who prefer artificial colors and flavor to natural and healthy foods are another target market for Classic Trix globally. The target customers can get access to this product in persons through the available General Mills stores and supermarkets near them. The product will be distributed from the main department stores located in each state in the USA to the designated supermarkets and hypermarkets for easy accessible to consumers.

Pricing and Marketing Strategy

The price of a commodity is the value assigned to it by the manufacturer in the market. A pricing strategy considers all the ability to pay, segments of the business, market circumstances, the actions of the rival companies, the input costs and trade margins just to mention a few. Firms often use various strategies to price their commodities depending on the target market and objective of reaching a given segment of consumers. Even though there are several factors that are likely to impact on the prospect revenue of the company, one of the essential is pricing policy employed.

In setting the value of Classic Trix, the management will consider the previously mentioned factors which may affect the revenue attained from this form of Trix. While consumers are likely to reject products that have high prices in the market, valuing them too low cannot also sustain the company in covering for all the costs incurred by the company in manufacturing. Since Classic Trix is a new line of Trix brand that no competitor has offered yet in the market the best strategy is economy pricing.

Economy Pricing

Economy pricing has been applicable to many businesses including those supplying generic foods and other discount retailers. The aim of this pricing strategy is to lure the most-price-sensible of customers in the current market. By applying this business strategy General Mills will be able to minimize the cost related to marketing and production of Classic Trix in a bid to maintain the prices low. As a result, target consumers can buy the brand among others offered by the company without flourishes. The pricing approach is appropriate to General Mills given that it is a multinational corporation with adequate resources and appreciating economies of scale in the market.

Marketing strategy

General Mills has a unique marketing strategy that has helped it achieve a competitive advantage over its rivals in the food industry over the last three decades now. The firm should employ a marketing strategy focused on positioning itself in the market which permits it to provide quality product to the end users. Johnston & Marshall (2013) discovered that business organization inside a niche market have dominance over a section of the industry. In regards to this, General Mills operates and does its business within a niche market, cereals; consequently, it dominates the market.

The continuous release of new products helps the company stay ahead of competitors and maintain customer loyalty. First to improve the income of this product the company should emphasize on building strategic partnership with its distributors to exploit the returns before other firms start producing cereals with artificial colors and flavor. Besides, it should focus on aggressive marketing and sales promotion techniques to its end-users. General Mills ought to undertake wide consumer education on the relevance of artificial foods in the market.

Market Mix

Market mix will play a considerable part in the establishment of the organization’s marketing approach through detailing the following aspects place, product, price and promotion.

Product

General Mills should incorporate noteworthy efforts in this component of marketing mix. Classic Trix consumers have the desire to explore new experience in artificial foods. Accordingly, the company should add value to this product to make the consumers love it and accept it thus persuading them to use more of the product.

Price

Consumers in the fast food industry are price sensitive. For that reason, General Mills ought to consider introducing the product in the market at relatively low price to attract more consumers to try the product and then after getting a positive feedback then they can gradually increase the price to cover for its production cost.

Place

The third component of marketing mix allows the firm to focus on the location of the product and the techniques used to reach the end-user of Classic Trix. In this case, the product will be available in persons where it is accessible to the customers (Barreiros Porto & da Rocha Lima, 2015). Additionally, the company should focus on establishing a partnership with wholesalers, supermarkets and other retail shops where consumers can easily access this essential breakfast commodity. At this stage, the sales force can educate consumers and sellers on why they have decided to remanufacture this product despite the reaction from the public nearly two years ago.

Promotion

The promotion plays a crucial role in influencing the sales volume of Classic Trix as well as revenue and success of General Mills. In regards to this concept, the firm will focus on advertisement using televisions and through the internet to increase their reach to the broad base of consumers. However, the promotion strategies should be aligned according to the federal and state regulations to avoid conflict with the authority.

Sales Force Overview

The sales force assigned to the promotion and marketing of Classic Trix will work as a business-to-business configuration by selling the item to retailers, supermarkets, wholesalers and distributors throughout the country (Kevin et al., 2010). The structure of the sales force assigned with the selling of this product will be tall sales organization. The configuration will have a national sales manager below them will be two regional sales managers. Each of the regional sales managers will have three district administrators, each with sales representatives. Also, the configuration of this sales force will help the customers as well as other dealers to maximize the personnel’s knowledge and contact within particular geographic regions. Below is a diagram representation of the structure.

In this task, the paper will focus on the strategies, structure, and methods regarding the sales force employed in marketing Classic Trix (Zoltners, Sinha & Lorimer, 2006). With a more advanced proposed sales force structure the organization is aiming at reaching out to potential customers globally. The first step that will ensure a product successfully enters the market is for the company to undertake a research and study on the size of the market they target within a given period.

Assessment of Market size

Providing or estimating the size of the market is an important task for any organization that is bringing a new product to the market. Consequently, before producing and selling Classic Trix, it is considered to assess the market size the company is targeting at the end of a particular period. Additionally, the firm needs to know if it can attract more investors to this line of production of Trix form. The target consumer for this product is children between the age of one to six years as well as adults.

The estimated number of target customer the segment aims to reach is approximately 40 million children within the first two ages of launching the product into the market. The firm assumes to achieve this goal given the product is mission-critical hence it will build a high penetration rate in the target market. Given that factors such attitude and perception of consumers drive the implementation of Classic Trix marketing strategy General Mills Inc. assumes to have a penetration rate of 80 percent for this product. The next step is calculating the possible market size regarding volume and value which will be;

Market volume = Number of target customers*penetration rate

MV= 40,000,000*80/100

MV= 32, 000,000 consumers

The company assumes the sale of one box of Classic Trix will yield $40, the market value will be

32,000,000*$40 = $1.28 billion

According to the Bureau of Labor Statistics (2014), American consumers are the greatest spenders accounting for 71 percent of the US GDP in the 2012 which is an increase by 8 percent from than of 1960. Consequently, with this information we will be able to meet the target sales for Classic Trix.

Fig. 1.0: Personal consumption expenditure as a percent of gross domestic product. Retrieved from: https://www.bls.gov/opub/mlr/2014/article/consumer-spending-and-us-employment-from-the-recession-through-2022.htm

The possible market for this product has various microeconomic and macroeconomic aspects that are likely to impact on the sales and market volume, the value of the market just to mention a few. In the food industry macroeconomic factors that can directly or indirectly affect the market value of the product in the US, as well as overseas markets, including taxes, inflation, depression, consumer confidence. Besides, unemployment rate, interest rates charged by the banks and other money lenders among others. The macroeconomic factors include the demand and supply, competitors, suppliers, size of the market among others. One of the major macroeconomic factors that affects the profitability of a particular market is corporate taxes which touches on both shareholders and the company itself as a distinct entity.

Sales Forecast

A sales forecast is an approximation in terms of dollar or unit of sales made for a stipulated future period (Johnston & Marshall, 2013). The forecast will be to determine the potential success of Classic Trix in the market. In this case, the company will utilize both methods of forecasting which include qualitative and quantitative technique. Employing all these approaches will help General Mills Inc. to attain good outcomes in terms of sales estimation better. In pursuing qualitative approach, the company will base its estimate on the judgments, emotions, intuition, opinions, as well as personal experiences, often considered subjective.

In reviewing this approach of forecasting, General Mills will implement both Delphi and sales force composite techniques. General Mills Inc. will utilize the Delphi approach to acquire opinions from the experts concerning forecasting the sales of goods; the method permits the collection of anonymous data and allowing repeated measurement. In using the sales force composite, the organization will get information from the effort of each of the members of the sales team concerning each territory allotted to them. Additionally, it will allow the company to have and make adequate use of historical data regarding the preciseness of every salesperson’s approximation in a bid to make variations to the forecasted sales. For the quantitative technique, General Mills will predict based upon mathematical concepts, and models often are always considered objective.

Setting Quotas

Sales quota is a term used to refer to the target set for a salesperson to meet within a particular time frame (Blessington, 2016). Consequently, this is one of the strategies used by companies to measure the efforts made by an individual towards achieving the sales goal. Some of the features of an effective quota include understandable, achievable, comprehensive and appropriate. General Mills will utilize two kinds of quotas namely activity and sales volume. In pursuing activity quota, the company will try to appreciate the investment nature of each salesperson’s work whereas sales volume quota emphasizes dollar sales. General Mills understands the significance of establishing a strategic partnership through consumers, wholesalers, and retailers to build strong and long-term connections.

Quota Level

Quota level is the phase that will allow General Mills to establish and allocate certain levels for every proposed quota. The firm will create sales quota centered on published territories that the management will split into states. Every salesperson will be allocated to eighty accounts which they will be accountable for. In setting the sales volume quota, the corporation will take into consideration several factors before establishing the final quota. Foremost, General Mills will assess the fast food industry for the next year and how it will affect the firm’s total sales. Moreover, the company should evaluate possible competition within food industry concerning synthetic colors and flavors and how such factor could affect the sales of the enterprise. Eventually, the firm will then evaluate every territory, regarding economic environment and potential growth.

Sizing of The Sales Force

Various strategies exist that organization and companies can use to size their sales force depending on the volume of the target market (Zoltners, Sinha & Lorimer, 2006). However, General Mills Inc. will pursue the workload approach commonly referred as the buildup technique to assess the size of the company’s sales force by territory. The plan will allow the firm to infer the total number of accounts that will be assigned to a particular region as well as how many each account will require regarding action level. Then the company can use the information gathered to evaluate the total number of individuals needed to permit the achievement of the organization’s sales objective in a given region.

Table 1: Workload Method for New Jersey Territory

Account Types

Number of Acc.

Workload involved (hours)

Total (Hours)

Divided by Selling time per week (768 hours)

Type A

186

48

8928

Type B

67

24

1608

Type C

80

36

2880

Total

-

13,416

17 Sales individuals

Sales Force Characteristics

Various organizations in the corporate world are using the HR department to recruit potential employees in the company with some particular features that will ensure they achieve the stipulated objective. Consequently, in meeting the sales quota proposed for each salesperson, General Mills will intensely look for specific traits that are applicable in this undertaking. Some of the features that the firm will consider when recruiting those individuals to join the sales force include; demographic and physical, experience in the field, talent, personality and communication (Waheed, Yang & Webber, 2017).

General Mills will not give much attention to demographic and physical factor as they have an insignificant influence on the success of sales that an individual makes in a particular period. The passion of people should also play a great role in determining those who are successful in joining the sales force. However, some traits will significantly impact on the sales made by a firm such as flexibility, responsibility, sociability, and creativity just to mention a few (Kothari & Pingle, 2015). Therefore, General Mills ought to focus on these traits as the final determinant of those joining the task force. Furthermore, the corporation will be able to recruit salespersons who are good at managing their time and can accomplish their task with little supervision.

Managerial Characteristics

When hiring the few individuals to occupy the managerial post, the company ought to focus on educational background and experience in sales and marketing from the applicants. They should have at least Bachelor’s Degree in sales and marketing accompanied by four-year experience in sales and management. Individuals with more than four years of experience will have the upper hand in the recruitment process.

Job Descriptions

The job description will be available in the General Mills websites for both front-line employees and managerial ranks.

Recruitment Process

One of the factors that considerably influences the success of sales force is recruitment and hiring process. The company strongly emphasizes on discovering new talents with the needed experience to help reach the approximated market value for each of the positions that will be advertised. The company is focusing on trade selling where the salesperson will be visiting the respective distributors to offer them information about the firm’s new product in the market. Moreover, it will pursue the missionary selling technique to reach out to the consumers and retailers to inform them about the new Trix product coming into the market.

Hiring Process

The hiring process that this organization will employ is the traditional approach where individuals fill out forms downloaded from the company’s website and a personality test done on-line related to the sales and marketing (Kothari & Pingle, 2015). An interview will follow which will take place after at least three weeks. The interview question will be organized similarly for all the candidates, to ensure the recruitment and hiring committee compare their strengths and weakness. Then a long day audition will follow the interview for every role specified in the application form. The process of the audition will help the hiring committee to know if they have hired individuals with the appropriate caliber for the jobs.

Training methods

General Mills will design a training technique that will support the efficiency of each in the team regarding the task awaiting them. The staff will be engaged in a full training process that goes for a week in Minneapolis where they will learn the objectives of the sales force, Classic Trix, and all its ingredients. Moreover, the training exercise will emphasize on a coaching style approach of teaching because it allows learners to ask and receive immediate feedback as well as advice about the challenges in the field. The training process will be an all-inclusive event for both selected managers and frontline employees.

Training Cost and Evaluation

Training exercise of employees is one of the expenses that do not bring direct revenue to the company even though the practice is expensive. The table below is the proposed total expenditure on training of the proposed sales force spent by General Mills. Consequently, it is advisable for General Mills to put aside nearly $10,000 for the whole training process.

Table 2: General and Administrative Expenses

Expenses (in dollars)

Day

1

2

3

4

5

6

7

General and Administrative Expenses

1,300

1,320

1,400

1,049

1,500

1,540

1,450

Compensation Plan

A considerable plan to compensate the sales representative is essential to retain and attract more employees with talents and desirable skills. Currently, General Mills sales representatives enjoy a salary pay accompanied with the commission and other miscellaneous rewards from the management. Jeff Harmening, CEO of the company, believes that firms have to pay more for talent, besides making their working environment desirable and enjoyable (General Mills, 2017). Given that the corporation offers commission and other rewards to its sales representatives the move will ensure the organization fetches the best skills and talents from the labor market.

References

Barreiros Porto, R., & da Rocha Lima, N. S. (2015). Nonlinear Impact of the Marketing Mix on Brand Sales Performance. Brazilian Business Review (English Edition), 12(5), 57-77.

Blessington, M. (2016). Sales Quota Accuracy and Forecasting. Foresight: The International Journal of Applied Forecasting, (40), 44-49.

Bureau of Labor Statistics (2014). Personal consumption expenditure as a percent of gross domestic product 1960-2012 and 2012. Retrieved from: https://www.bls.gov/opub/mlr/2014/article/consumer-spending-and-us-employment-from-the-recession-through-2022.htm

General Mills (2017). General Mills Retail Sales Representative Salaries. Retrieved from: https://www.glassdoor.com/Salary/General-Mills-Retail-Sales-Representative-Salaries-E278_D_KO14,41.htm. Accessed on 1 October 2017.

Johnston, M. W., & Marshall, G. W. (2013). Sales force Management (11th Ed.). New York, NY: Routledge.

Kevin, B., Steven, B., Shankar, G., Gary, H., Vincent, O., Robert, P., & ... Barton, W. (2010). The embedded sales force: Connecting buying and selling organizations. Marketing Letters, (3), 239.

Kothari, T. P., & Pingle, S. S. (2015). Establishing the Relationship between Marketing Specialization and Personality Traits among Management Students. Paradigm (09718907), 19(2), 170-183.

MarketLine (2016). Company Profile: General Mills, Inc.

Waheed, A., Yang, J., & Webber J. (2017). The Effect of Personality Traits On Sales Performance: An Empirical Investigation to Test the Five-Factor Model (FFM) In Pakistan. Retrieved from: http://www.ijikm.org/Volume12/IJIKMv12p139-157Waheed2882.pdf. Accessed on 30th September 2017.

Zoltners, A. A., Sinha, P., & Lorimer, S. E. (2006). Match Your Sales Force Structure to Your Business Life Cycle. (cover story). Harvard Business Review, 84(7/8), 81-89.

November 09, 2022
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