Pringles and Lay's extension

          About Pringles, product portfolio includes the core Pringles potato crisps in a canister, product line extensions featuring different compositions and flavors and Pringles “Stix”, a recently introduced cracker stick.

In term of sales, we distinguish:

• ·         Core Pringles with 90% of total sales, it’s the original and traditional flavor
• ·         Extensions with 7% of sales, it’s fat-free, light and X-TREME
• ·         Stix with 3%, it’s cracker sticks

Pringles owns a dedicated R&D team of 75+ employees with 4 main functions

• ·         Product Research: Consumer studies & testing
• ·         Formula Design: Product formulation and development
• ·         Process Development: Application of new products on the production lines, local production lines and efficiencies
• ·         Packaging: New size offerings and material designs

       We can explain the interest of these extension products by the decision of Pringles to customize efficiently flavors and packaging according to the geographic region.

Pringles manufacturing process allows for significant flexibility because they are proprietary of manufacturing process and packagind.

Moreover, they own a highly complementary ambient storage warehouse delivered distribution system.

Few examples of Pringles extension:

North America products:

·        Cajun Sweet BBQ, Onion Blossom, Mozzarella Sticks & Marinara, Buffalo Wing and Dill Pickle

Lays: “They are innovating globally by delighting locally”.

In 2011, they achieved a significant milestone, with approximately 50% of their revenue coming from outside US including 34% of emerging markets. They drove this success by recognizing that they have to win one consumer at a time, striking the right balance between global scale and local relevance. Importantly, they also continued to build our research and development capabilities as well as to strengthen new platforms for growth in global categories such as grain snacks.

Catering to local tastes and cultures, they sell unique flavor varieties of our snacks in local markets, such as Lay’s Jamon (Ham) – Spain; Lay’s Strong Horseradish – Poland; Lay’s Red Caviar – Russia; Lay’s al Plato Barbecue – Argentina; Lay’s Hot & Sour Fish Soup – China; Clipsy Serbian Sausage – Serbia; Walker’s Worchester Sauce – United Kingdom; and Sabritas Buffalo – Mexico

Build and extend their macrosnacks portfolio globally. PepsiCo is the undisputed leader inmacrosnacks around the world. They will work to build their much-loved global snack brands — Lay’s, Doritos, Cheetos and SunChips — while expanding their successful grain-based snacks platform globally. They will continue to create age our go-to-market expertise to ensure that their brands are always available wherever their consumers shop.

Lay’s growth in 2011 was driven by expansion in many local markets, including Russia, where Lay’s has become the number one snack brand. For our Russian consumers, we created Lay’s pickled cucumber, which delivered strong volume growth in 2011.

Gaelle Soussan