Wednesday, 22 February 2012

Will they taste different now? Pringles brand changes ownership

Fellow blogger Nikos Prentoulis (a long-standing member of the MARQUES Class 46 blog team) was invited to comment on a recent transaction that has attracted considerable interest in the popular press - the acquisiton by the Kellogg Company of the Procter & Gamble Pringles brand.  Says Nikos:
"The brand community has been buzzing over recent news of the deal struck between P&G and Kellogg regarding the take-over of the Pringles brand. Kellogg will buy Pringles for US$ 2.7 billion in a transaction which will make Kellogg No. 2 (second only to PepsiCo as reported by Reuters) in the global snack food market. The deal apparently marks P&G’s exit from the foodstuff market. 
Pringles is reportedly the fourth-largest brand of snacks in the world, with 2.3 percent of the market, according to Euromonitor International. In the United States, it ranks eighth with 2.5 percent. 
Although one would not expect Pringles to taste different after the assignment, the transaction raises a number of interesting issues: 

• The added-value for the owner of a ‘stand-alone’ famous brand – and its competitors 
• The marketing dilemma of the new owner – should one ‘freshen up’ the brand to tailor one’s own (i.e. those of his marketing team) perceptions of the brand and/or reflect the new owner’s brand/product philosophy or should the brand be left to sell itself? 

• How could consumer perception of the brand/product change after the transfer? Would consumer behavior toward the brand/product change, even in the absence of any ‘tampering’ by the new owner? 

• Can other brands of the new owner benefit from such a deal (either through use of the newly acquired brand’s repute in market where such brands are not strong or even through the ‘media buzz’ concerning the new owner)? 

• Finally, will they introduce a new Pringles taste?"

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