Hain Celstial
When Walmart went looking for a supplier for natural and organic foods, it had to find a firm that would agree to sell at low prices so that Walmart could enjoy a reasonable profit while still maintaining its cost leader status. Wild Oats Marketplace —not Hain Celestial— agreed to be that low-cost supplier. This agreement is the result of which of the five forces of competition?
Bargaining power of buyers
The Hain Celestial Group, which includes premium brands like Celestial Seasonings, Ell's, and BluePrint, offers organic and natural foods exclusively. Which of the five business-level strategies has the firm decided to pursue?
Focused differentiation
Traditionally, Walmart has offered a broad array of the most popular products at low prices. However, its recent decision to carry about 100 different natural and organic products from Wild Oats Marketplace —still at below-average prices —could be a sign of a change in strategy designed to distinguish the firm from other low-cost retailers. Which of the five business-level strategies is Walmart most likely pursuing now?
Integrated cost leadership/differentiation
Based on the success of Hain Celestial, other larger, more traditional food manufacturers may decide to enter the market for natural and organic foods and "out-focus" the focuser. What is the best way for Hain Celestial to guard against this kind of competition?
Internally develop innovative products
Assume that a 12-oz. bag of black chia seeds made by one of Hain Celestial's brands retails at Whole Foods Market for $8.50, while the same-sized bag of Wild Oats Marketplace black chia seeds retails at Walmart for $7.85. Does Hain Celestial face any risk from this product substitute?
Maybe; some Hain Celestial customers may be loyal to the brand, while others may not perceive any real difference between the two brands and will thus opt for the less expensive Wild Oats brand.
Which of the following best describes Hain Celestial Group's target market segment?
People who want to eat healthy, wholesome foods
The evolving consumer preference for healthier options has prompted some well-established brands to modify their products. Specifically, snack foods manufacturer Nestlé is removing artificial colors and dyes from some of its products, and packaged candy giants Hershey and Mars are both reducing the amount of high-fructose corn syrup in some of their products. Which of the following best describes these three organizations' strategy for differentiating themselves?
Performing activities differently
Which of the following is NOT one of the risks associated with the business-level strategy Hain Celestial is pursuing?
Powerful customers might be able to force Hain Celestial to reduce its prices even further
Which of the following best describes Hain Celestial's business model?
Wholesale seller
In response to dwindling sales of organic meats, Hain Celestial executives decided to promote the sale of organically grown nuts as an alternative source of protein, which is an excellent example of a firm's:
product substitutes.
