Tastycake Sensables Background- Tasty Baking Company (Tbc)

Tastycake Sensables

Background- Tasty Baking Company (TBC) manufactures, co-packages, and sells a variety of premium single portion cakes, pies, snack bars, pretzels and brownies under the name Tastykake. At present there are about 100 different varieties. The company posts revenues of a bit over $200 million. One of the products that TBC brought to market was the Sensable Sugar Free line of treats, which many called a sugar-free Twinkie (Prouty, 2008). Sensables are marketed with only 2-5 grams of net carbs per serving, but have only a 21 day shelf life at room temperature.

New Product Development- In business and engineering there is a process required to bring new products to market. It is typically an eight stage process in which different tasks are the focus, allowing the development process to remain robust. In the era of computers, however, some of the steps have been truncated, thus decreasing time to market and increasing competitive advantage. Each stage is rather fluid (i.e. may be omitted, last shorter or longer, etc.).

Step

Components

Issues for TBC

1. Idea Generation

Sometimes known as fuzzy front end; comprised of SWOT analysis, market and consumer trends, R&D development, feedback, opportunity analysis, etc.

Low carb, Atkins frenzy, books, diets, health conscious America.

2. Idea Screening

Features and benefits; size and growth forecasts; competitive pressures; industry standards; feasibility; will product be profitable in reasonable amount of time.

How can TastyKake find a product niche for those who still have a fast food need but are counting carbs?

3. Concept Development and Testing

Investigate past products and the competition; features and benefits; consumer issues; costs; feasibility.

Issues with low carb and no sugar products: palatability, shelf-life, taste, texture.

4. Business Analysis

Establish likely selling price, penetration needs, estimate break even.

Is low-carb a fad or a trend?

5. Beta and Market Testing

Produce physical mock up; test product and packaging; conduct focus groups, adjust, re-research, begin to store data.

East Coast shows some success; big box stores (Target, Wal-Mart, etc.) are interested.

6. Technical Implementation

Quality management, resources, published data sheets, supplier collaboration, chain marketing, logistics.

True issue; flavors had to be artificial; shelf life issue; consumer perception.

7. Commercialization

Product launch, distribution chain, critical path analysis.

Ad campaign -- indulge.

8. New Product Pricing and Redevelopment

Impact, forecasts, competitive transition, value segments, plan for future.

Market extension, product lines.

Ideas to market foods are often quite problematical, due to the issue of discovering whether a new product is a trend or a fad. Not all products can be as successful with such longevity as Twinkies, Hostess Cupcakes, etc. Tastykake's entry into the low-carb market was dangerous at best, even though market trends showed that there was a strong need for low-carb, sugar free, desert indulgences. It made sense -- consumers desperately wanted to be able to snack, but wanted to do so without the guild associated with most snack foods. Clearly, though, there were several issues which prevented a long-term success for Sensables, and indeed, for the company: