Broad Appeal Creates Need for Brand Strategy Guidelines
This Quaker brand strategy case study shows that robust research can uncover surprising areas for brand extension. Managing the brand as a highly valuable asset calls for expansion within guidelines.
Quaker: Case Study of a Valuable, Powerful and Extendible Brand
The Quaker brand is extremely valuable and powerful. You likely know that the brand has been extended from its heritage in standard Quaker oatmeal to bars, cold cereal, and more.
In fact, adding the Quaker name to many food and beverage categories adds to the product’s appeal. It’s not hard to field a piece of quantitative research demonstrating that adding the Quaker name boosts a new product line’s appeal.
Quaker Oats was bought by PepsiCo in 2001 for $13.4 billion, mostly for the then-$2 billion Gatorade beverage brand and for the sports drink’s complementarity to PepsiCo’s beverage portfolio. Another synergy for PepsiCo was in snacks, with Quaker’s Chewy snack bars. PepsiCo has a broad portfolio of beverages, snacks and foods.
Quaker Brand has Broad Permission, Not Limited to Healthy and Grain-based Foods. Works for Indulgent Foods and Beverages
While Quaker tends to be associated with healthier products, consumers find it highly appealing and appropriate for Quaker to offer indulgent baked goods like cookies, pies or brownies.
Similarly, while Quaker is mainly known for foods, consumers also find it highly appealing and appropriate for Quaker to offer beverages like water (and PepsiCo is in the water business) or milk (in 2018-2019, Quaker oat milk was offered).
As far as pricing, Quaker is known for good quality products at mainstream prices, but research has been done to justify using the name on a value-oriented line of waters, when there was a gap in the PepsiCo portfolio.
While this is a great asset to own, this power also presents a challenge, and a need for guidelines. Unchecked extension without guidelines is a choice that could mean the Quaker brand becomes a high-level trademark and quality endorser.
Quaker Brand Strategy Case Study Research Approach
The Quaker brand strategy leveraged prior research and also included new quantitative brand equity research among 2,850 primary grocery shoppers ages 18-70. There were over 1,100 shoppers of organic/natural food and beverage channels. In addition to Quaker, the mainstream megabrand competitive set included:
- Sara Lee
- Pepperidge Farm
- And others
All of the large megabrands had high levels of aided awareness (90%+) and past 12-month purchase incidence (most at 50%+).
At the time, Quaker’s strength was found across all generations, but was particularly strong among Boomers and Matures, indicating an opportunity to increase relevance to Millennials.
Quaker Brand Strategy Leverages Multi-Dimensional Strengths
On rational benefits, Quaker outdistanced the other megabrands on health and nutrition. Other strong health equities were Tropicana, Dannon, Healthy Choice and Dole. Quaker was also good tasting, while more indulgent megabrands are more likely to be great tasting (e.g., Pepperidge Farm, Sara Lee, Pillsbury). Quaker stands out from other close in “healthy” breakfast competitors like Cheerios and Kellogg’s on hunger satisfaction – a point of differentiation.
Emotionally, the Quaker brand had strength around being a smart choice for taking care of self and also for putting families first.
Related to the emotional benefits, Quaker’s brand was genuine, family oriented, caring and knowledgeable. It was less innovative and contemporary.
Quaker Brand Strategy Case Study: Category Expansion Zones
Quantitative research looked at category extension opportunities. The assessment was extensive, with 47 categories and multiple approaches (i.e., direct fit, indirect fit, packaging illustrations).
Consumers expressed interest in Quaker brand expanding from its current strength in the breakfast occasion to additional snacks, healthy breads and healthy beverages.
When asked directly which categories Quaker is best suited for, consumers are most likely to stay “closer to home” and generate healthy food items, particularly breakfast foods (e.g., whole grain bread), bakery items (cookies, mixes) and also other healthy snacks (e.g., fruit/fruit snacks, snack nuts/mixes, etc.) Quaker’s core equities also suggested that it could offer several other nutrient-rich products, including the whole grain bread, fruits and vegetables, yogurt and dairy beverages.
The Quaker brand strategy category expansion zones were identified, suggesting additional healthy snacks, and breads and even yogurt. In 2012, Quaker Muller launched yogurts in the US, though it was ultimately unsuccessful. Importantly, danger zones were also identified to not expand into, such as breakfast meats, pastry and doughnuts.
Does your brand have a clear strategy for expansion into other categories based on a robust research understanding? Contact Insight to Action to learn more.