Do You Want the Short Version?
The Problem: How can Frito-Lay continue to dominate the chip category?
The Process: Segment the chip market
The Solution: Frito-Lay should speak to all five distinct segments (Comfort Seekers, Flavor Adventurers, Chip Skeptics, Texture Cravers, and Socialite Chippers) through specific recommendations
Or the Long Version?
Frito-Lay is THE chip giant of the chip category. Frito-Lay (owned by PepsiCo) controls nearly nearly two thirds of the category with sales more than ten times greater than the second-largest competitor. However, Frito-Lay shouldn’t get comfortable. Trends such as premiumization, a larger emphasis on health, and an increase in private label sales are on the rise. Segmentation will ensure Frito-Lay has their finger on the pulse of chip consumers so they can stay on top.
Man-on-the street interviews
Secondary research (Mintel, IBISWorld, etc.)
Segmentation survey (behavioral, values-based questions with agree/disagree Likert scale questions)
The five chip segments we found are:
Recommendation #1: Up the Crunch!
Release an extra-crunchy version of the classics people love to target the Texture Cravers
Offer extra crunchy Doritos, Ruffles, and Lays
Similar to the Ruffles Mega Crunch found in the Mexican market, but using classic flavors
Recommendation #2: Embrace Comfort
Launch a campaign that embraces couch-sitting, comfort-seeking indulgence for the Comfort Seekers
Target media buy to viewing platforms that enable binge-watching, such as Hulu, Amazon Prime, YouTube, and ESPN+
Consider spokespeople to portray unexpected comfort eaters
Recommendation #3: Travel with Flavors
Travel with Lay’s matched to the seasons to speak to the Flavor Adventurers
Salted Cucumber from Russia in the summer
Baked Chicken with Thyme from Romania in the fall
Winter Onion from Poland in the winter
Green Tea from China in the spring
Recommendation #4: Refresh Healthy Offerings
Innovate new products to appeal to a wider range of health-conscious consumers to get those Chip Skeptics
Expand Simply line to include different cooking oils for dietary preferences and restrictions
Expand dip offerings to include healthy, fresher options like hummus and veggie dips
Rebrand Baked as lower calorie chips versus low fat
Recommendation #5: Appeal to Gourmet Connoisseurs
Buy small scale gourmet brands like Route 11 to attract Chip Socialites
Similar to how big beer companies are acquiring local breweries
Maintain independent branding, messaging, etc.
Captures a different type of chip consumer
I enjoyed this project because it was the perfect fusion of data and storytelling. This segmentation study was one of the most challenging (and rewarding) projects I’ve worked on to date!
Completed in-store research, 1-on-1 interviews, and secondary research
Cross-tabulated, cross-tabulated, and cross-tabulated some more in Qualtrics to find the market segments
Collaborated with teammates to develop and present a deck on our findings and recommendations
You can buy blueberry Lay’s in China.
Aaron Lee (Strategist), Madison McCracken (Strategist), and Bonni Dinerstein (Strategist)