Bouchard Case Study
Background & Marketing Objective
Bouchard is a Belgian based chocolate manufacturer that has been making chocolate in the city of Ghent since 1931. They were doing ~$30M in annual revenue when they were acquired by a mid-market German conglomerate named Halloren (~130M annual revenue). Halloren acquired Bouchard in order to try to broaden their reach and distribution. A majority of Bouchard’s revenue comes from producing chocolate for private label (meaning they produce the chocolate and package it to be sold as a Member’s Mark or Kirkland brand). Bouchard was doing this for around 100 companies in over 50 countries, including the US and China.
However, Bouchard was trying to make a conscious attempt to develop their own brand internationally. They wanted to enter the US market. However, entering the US market successfully is easier said than done, especially when their primary product to enter was a bar of new probiotic chocolate. They had tried to launch a product experimentally through Costco but had mixed success due to various perceptions and distribution issues. We were brought on board to help answer three main questions:
Is there viable information to support the idea that their product(s) would be successful in the US? (this information was to be used both internally and to create a pitch deck to be used by sales reps to pitch grocery buyers with)
Is the probiotic chocolate the right product to lead into the market with? Or would one of their other products be better received?
Based on their distribution constraints and our findings about their products, which channels and stores would be the most effective methods of distribution?
Process
We had an amazing mentor on this project. He had over 30 years of experience, including a Harvard Business School MBA, where he ultimately lead all refrigerated grocery for Wal-Mart. He felt that the most important thing to kick off this process was to conduct some qualitative research.
We needed to figure out if people even liked the way their chocolate looked and tasted. I mean, if no one liked how it tasted, it didn’t matter what else we did. It wouldn’t sell, right? So we set out to establish a few focus groups. We hypothesized that our target demographic for a new chocolate brand would be millennials due to their lack of brand loyalty. We held focus groups for both millennials and other age ranges where we had them do taste tests comparing various Bouchard chocolates to other commonly known brands including Dove, Lindt, Godiva, and Ghiradelli. We had respondents rate the chocolates on various attributes like appearance, taste, smell, and texture. What we determined was that Bouchard typically ranked in the upper quartile on all of these attributes. From this, we determined that we had a viable product, but we knew that grocers would want to see more substantial figures.
To solve this problem, we then moved to a more intense taste test run by a professional sensory lab. They have an expansive panel of respondents, and we were able to conduct a multi-faceted taste test with over 150 people. These results returned similar responses to our smaller focus groups.
As we did more research into chocolate, we learned that while Bouchard was a similar tasting chocolate, it actually was far healthier due to some ingredient differences. It offered significantly lower fats, calories, and sugars. It was also made with natural ingredients, and those at Bouchard were working to get USDA Organic and Non-GMO on the packaging. We thought that this could potentially be a positioning tactic: “Same great taste with none of the preservatives”, so we tested some of this within the taste test. We saw overwhelmingly positive results in these questions.
From here, we moved on to our quant survey. We had gathered enough information about the flavors of Bouchard chocolate and their preferences to build a pitch deck to show grocery buyers that Bouchard belonged on the shelf.
Now we just needed to gather some more information about how to position Bouchard to consumers once it was on the shelf. To do this, we build an extensive quantitative survey and received results from over 800 qualified responses through the use of a professional panel. The purpose of this survey was to help inform our decisions for who would be interested in the chocolate and where they shopped.
Another key attribute of this survey was building an adaptive choice based conjoint. A choice-based conjoint is something marketing researchers use where they break products down into various attributes (in the case of chocolate, this would be size, weight, flavor, etc.) and levels (probiotic, milk and caramel, dark chocolate). Respondents are then shown various combinations of these attributes and levels and forced to choose which they would prefer.
From this experiment, with enough respondents, we can provide accurate information about what features are most important to consumers in picking a product. With this information, we can build a simulated “market” that allows us to see how various combinations of attributes would perform in the market so that we can make specific recommendations about a product for the company. Bouchard was looking to launch a 16 oz. bag of probiotic chocolate into the market. We were able to deduce a few things from our conjoint, including:
Consumers preferred smaller bags. They perceived a larger bag from an unknown brand as a larger risk. What if they didn’t like it? They’d be stuck with a huge bag of chocolate.
Consumers were wary of probiotic chocolate. Most wanted to enjoy and splurge with chocolate, not have it be healthy. They preferred a milk chocolate with caramel flavor.
Chocolate with fewer ingredients that were pure/natural was very important to consumers.
Outcome
We learned a lot about chocolate and consumers, more information than I thought I would know about chocolate in my lifetime (read more about the team’s experience on the project here). I still have dreams where I try to remember the differences between sunflower and soy lecithin and how they impact the chocolate’s taste (quite an interesting read if you have the time). Here are the final recommendations we made to the client.
Bouchard’s chocolate is an excellent option for young, millennial customers. These customers are not 100% loyal to any one brand and are open to swapping. These customers are also very influenced by pure/natural ingredients which Bouchard does better than any other competitor. We recommend that Bouchard differentiate themselves in the market by emphasizing this in packaging and messaging.
We also recommended that they lead with their milk chocolate and caramel, but that they move to a much smaller packaging size. Bouchard had packaging constraints where they could only ship in full pallets. Because of this, their distribution was kind of limited. We conducted interviews with various grocers around the country whose stores matched those of the target demographic. From this information, we made recommendations for which stores to target. We also provided the market “simulator” from our conjoint for the client to toggle with and play around to see how other products could and would perform.