Case 3: True Body Products Should A Small Company Extend Its

Case 3true Body Productsshould A Small Company Extend Its Product Line

Case 3 True Body Products Should a Small Company Extend Its Product Line to Satisfy a Key Customer? In 2007, after spending 15 years in product development and brand management with large companies such as Procter and Gamble, Welch's, and Seventh Generation, Janice Shade decided to start True Body Products, a company in Richmond, Vermont, that markets all-natural, unscented, affordable soaps. True Body's line of soaps is manufactured to strict quality standards by a New England contract manufacturer and sold in 45 Whole Foods stores in the Northeast, Fred Meyer stores in the Northwest, and several independent natural food stores across the United States and online at alice.com, an online household products marketplace.

In its first full year of operation, True Body generated sales of $45,000. Shade was operating the company using the $100,000 that she and private investors had invested in the company at start-up. The buyer from Whole Foods with whom Shade works recently approached her with an idea for increasing sales of True Body products. "Why not introduce a line of scented soaps?" the buyer asked Shade. Scented soaps would be a natural extension of the small company's product line, would increase its shelf presence in stores, and would lead to more sales.

Shade wanted to avoid alienating or confusing existing customers, many of whom suffered from allergies and purchased True Body products because the soaps were unscented. "The most ardent and positive consumer feedback I get is from people who are happy to have found an unscented bar soap," she says. However, Shade thought that the idea of adding a scented line was worth considering. "I want my business to grow to a scale where it makes an impression on the world," she says. Shade began to research scented soaps and consider the options for her company with her advisory board.

She asked the company that manufactures her soaps to create samples of soaps scented with fragrances such as lavender and grapefruit. "Then we started costing them out," says Shade. "That's when the red flags came up." Because True Body's soaps are made with all-natural ingredients, the manufacturer would have to use costly pure essential oils rather than cheaper synthetic fragrances to create the line of scented soaps. The result would be higher prices for the scented soaps. Shade estimated that True Body soaps would have to retail for $6.19 for a package of three bars, compared to just $5.49 for a package of three unscented bars.

The higher pricing concerned Shade because she built her company on the premise of marketing soaps that are all-natural and affordable. In conversations with the buyer, she learned that if she introduced scented soaps, the retailer planned to set the price of both the unscented and the scented soaps at $6.19 for a package of three bars. Concerned that customers would balk at the price increase, Shade considered selling the scented soap in two-bar packages, a pricing tactic that would allow her to offer a lower price point. She agreed with the Whole Foods buyer that True Body needed more in-store shelf exposure and began to consider other ways to expand her company’s product line that would be more consistent with her commitment to all-natural, unscented soaps, including liquid hand soap, shampoos, face soap, and others.

"I have every intention of growing," says Shade, "but I want to be intentional about it." Questions 1. Should Shade introduce scented soaps to True Body's product line? Explain. 2. What steps should Shade take to increase the in-store shelf space of True Body's products? 3. Given Shade's vision for her company (soaps that are all-natural, unscented, and affordable), do you think that her concerns over the proposed higher prices that Whole Foods would charge for her unscented soaps are justified? Explain. 4. Write a one-page memo to Janice Shade outlining the key components of a marketing strategy that will increase her company's in-store shelf space and its sales.

Paper For Above instruction

In the highly competitive landscape of natural personal care products, small companies like True Body Products face critical strategic decisions when considering expansion efforts such as product line extensions. The question of whether to introduce scented soaps, which contradict the company’s foundational principle of all-natural and unscented products, requires a nuanced analysis balancing growth ambitions, consumer trust, and cost implications. This paper explores whether Shade should proceed with the scented soap extension, strategies to augment shelf space in retail environments, justification of her pricing concerns, and a comprehensive marketing plan tailored for her company's ethos and growth objectives.

Should Shade Introduce Scented Soaps?

Deciding whether to introduce scented soaps to True Body’s product line hinges on multiple factors, including brand identity, customer preferences, and financial viability. Given that True Body has built its reputation on providing all-natural, unscented soaps catering to allergy-prone consumers, introducing scented variants risks alienating its core customer base. Customers who value the unscented, hypoallergenic qualities of the product may feel betrayed if fragrance additions increase prices and dilute the brand’s purity. Therefore, from a brand integrity perspective, Shade should carefully evaluate whether the potential sales boost justifies the risk of damaging customer trust. As market research indicates, niche brands that align closely with customer values tend to sustain loyalty better, and deviating from these principles may undermine long-term success (Kotler & Keller, 2016).

However, the market demand for scented natural products is significant, with consumers increasingly seeking aromatherapeutic and fragrance-enhanced options. If Shade considers this extension, she could explore a separate product line—such as a premium scented soap line—that maintains the integrity of her original unscented offerings. This approach allows targeted diversification without compromising her brand's core identity, catering to different consumer segments while reducing risk (Porter, 2008).

Furthermore, the cost implications of using essential oils versus synthetic fragrances represent a major barrier. The heightened retail price point ($6.19 vs. $5.49) necessary for the scented soap indicates that profitability per unit would diminish without significant sales volume. If the scented line is introduced, it should be positioned as a premium product line to justify higher prices, which aligns with market trends that support premium pricing for natural ingredients (Nielsen, 2015). Alternatively, Shade could explore options like creating scent-free, hypoallergenic variants—a subtle differentiation that leverages her existing brand promise without straying into contentious territory.

Strategies to Increase Shelf Space

To enhance shelf space in retail environments, Shade must leverage multiple strategic avenues. First, establishing strong relationships with retail buyers through consistent communication and demonstrating the distinctiveness of True Body’s products can persuade stores to allocate more space (Harrington, 2017). Providing point-of-sale displays, product demonstrations, and samples could also increase visibility and consumer interest, ultimately persuading retailers to prioritize her products (Keller, 2013).

Second, expanding product lines to include complementary items such as liquid hand soaps, shampoos, and facial cleansers offers the opportunity for bundle placement. This diversification enhances the brand's presence on shelves and appeals to consumers seeking a complete line of natural personal care products. To support this, market entry strategies should emphasize product efficacy, all-natural ingredients, and affordability—values that have resonated with her existing customer base (Lamb, Hair, McDaniel, & Solomon, 2017).

Third, engaging in targeted marketing campaigns within retail settings, including incentives for retailers and consumers, could incentivize shelf space expansion. For instance, loyalty programs, special promotions, or introductory discounts can stimulate sales volume, encouraging retailers to allocate more space (Kotler & Keller, 2016). Additionally, developing attractive packaging that stands out on shelves can draw consumer attention, thereby increasing demand and shelf placement (Aaker, 2014).

Addressing Pricing Concerns

Shade’s concerns about higher prices for scented soaps are justified given her commitment to affordability and natural ingredients. The use of pure essential oils, which are more costly than synthetics, increases production costs and retail prices—raising the question of whether consumers are willing to pay a premium for natural fragrances (Nielsen, 2015). Since her current brand positioning is centered around affordability, a significant price hike risks alienating her core customers, particularly those with allergies or sensitivities who may be more price-sensitive.

Moreover, setting both unscented and scented soap at the same higher retail price ($6.19) could create consumer pushback, especially if perceived as inconsistent with the brand promise of affordability. Instead, Shade might consider a phased approach: launching a premium scented line at higher prices targeted at niche markets, while maintaining the core unscented, affordable line. This stratification allows her to cater to different segments without diluting her brand identity. Also, exploring cost reductions in other areas, such as packaging or tighter supply chain management, could help mitigate the price impact while maintaining profitability (Porter, 2008).

Marketing Strategy to Boost Shelf Space and Sales

A comprehensive marketing strategy for True Body should focus on reinforcing brand values, increasing visibility, and broadening consumer reach. First, reinforcing messaging around natural, hypoallergenic, and affordable soaps will solidify brand positioning and appeal to health-conscious consumers. This could be achieved through digital marketing campaigns, emphasizing testimonials and educational content related to allergies and natural ingredients (Kotler & Keller, 2016).

Second, forming strategic partnerships with retail chains beyond Whole Foods, such as independent natural stores and online marketplaces, can diversify distribution channels and reduce overreliance on a few key retailers. Enhancing online presence through targeted social media marketing and influencer collaborations can amplify brand awareness and generate direct sales, which in turn incentivizes retailers to stock more products (Hollensen, 2015).

Third, focusing on retail merchandising initiatives such as eye-catching displays, in-store sampling, and promotional events will increase consumer engagement and product visibility. Offering incentives like introductory discounts or bundle offers can stimulate trial and repeat purchases, further solidifying shelf presence (Lamb, Hair, McDaniel, & Solomon, 2017). Practical support like customized packaging solutions that appeal visually and communicate product benefits can also drive shelf allocation decisions (Aaker, 2014).

Finally, Shade should consistently gather customer feedback and behavioral data to refine her product offerings and promotional strategies. This iterative process aligns her growth efforts with customer preferences, ensuring sustainable expansion while maintaining her commitment to all-natural, affordable products (Keller, 2013).

References

• Aaker, D. (2014). Building Strong Brands. Free Press.
• Harrington, S. (2017). Retail Strategies for Small Businesses. Retail Book Publishing.
• Hollensen, S. (2015). Marketing Management: A Relationship Approach. Pearson.
• Keller, K. L. (2013). Strategic Brand Management. Pearson.
• Kotler, P., & Keller, K. L. (2016). Marketing Management. Pearson.
• Lamb, C. W., Hair, J. F., McDaniel, C., & Solomon, M. R. (2017). MKTG 12: Principles of Marketing. Cengage Learning.
• Nielsen. (2015). The Rise of Natural and Organic Products. Nielsen Reports.
• Porter, M. E. (2008). Competitive Strategy: Techniques for Analyzing Industries and Competitors. Free Press.
• Gardella, A. (2010). Can a Small Company Say No to Whole Foods? The New York Times.
• Gardella, A. (2011). A Start-Up Soap Maker Starts to Get Traction. The New York Times.