Lays PPT (Group 14)

Consumer Behaviour
Lay’s Potato Chips in Hungary

OVERVIEW
Globally recognized brand ,owned by PepsiCo
Est in 1965 → Merger of Pepsi-Cola + Frito-Lay
Traditional Snacks (49%)

Nuts (14%).
Potato Chips(17%)
Corn Products(17%)
Other (2%)
Internal Influences Driving Consumer Preference
❏ Perception → Packaging and Brand Image

❏ Motivayion → Hedonic Needs and Social Needs
❏ Learning → Classical Conditioning and Operant Conditioning
❏ Attitudes → Brand Loyalty and Social Proof
❏ Lifestyle → Convenience and Social Status
Understanding these factors, marketers can develop strategies to
target specific consumer segments and enhance brand preference.
Key Competitors and Market Dynamics
PepsiCo Snacks:
● Leader with 47% market share in Q1 1990.

● Chio products: higher than Lay's by 2% in mid-price segment.
● US$11 million marketing budget with 44% on mass media.
● "Chio Chips" message emphasized; strong distribution network.
United Biscuits:
● Held 28% market share.

● Premium segment: priced 12% higher than Lay's.
● Focused on quality and distinctive packaging.
● US$500,000 marketing budget, mostly for TV and radio ads
Zweifel:
● Austrian brand with 10% market share.
● Positioned on price, sold for 5%-7% less than Lay's.
● Focused on price promotions.
Consumer Behavior and Marketing
● Consumer Preferences:
○ Hungarian market differed from Western Europe.
○ Homemade snacks preferred, slow shift towards packaged goods.
○ Focus on traditional snacks and cookies.
● Research Insights:
○ Consumers cared most about flavor (68%) and price.
○ Impulse buying was a major driver.
○ Promotions: small gifts, basic price discounts, and large-scale offers.
Awareness and Perception Theory – AIDA Model
The AIDA (Attention, Interest, Desire, Action) model is crucial for building brand awareness and creating
customer engagement. This model breaks down the steps a consumer goes through before purchasing a
product.
● Attention: Use high-visibility outdoor campaigns to attract potential customers. As seen in the
case, Lay's used billboards, but these were ineffective due to poor timing and competition's heavy
TV and radio presence.
● Interest: Spark interest by emphasizing the unique selling proposition (USP) of the product. Lay's
needs to communicate its superior quality using sensory cues (taste, texture, freshness) and
through better advertising mediums such as TV or engaging radio ads.
● Desire: Appeal to Hungarian preferences. Since taste is a major factor for snack preference, focus
messaging on flavor variety and quality control in potato chip production.
● Action: Drive impulse buying through consumer promotions (e.g., coupons, sweepstakes).
Hungarian consumers respond well to promotions, so including such offers would entice them to
make a purchase immediately.
Brand Positioning and Differentiation Theory
Brand positioning ensures that Lay's is perceived as distinct and superior compared to competitors like
Chio or United Biscuits.
● Quality Perception: Although Lay’s chips are of superior quality, Hungarian consumers didn’t
perceive it that way due to competitors’ dominant market presence. Lay's should focus on quality
signals through premium packaging (e.g., metalized foil), clearly differentiating itself from
competitors' low-quality plastic packaging.
● Competitive Pricing Strategy: Lay's positioned itself between premium and budget categories. To
balance perception and price, marketing can emphasize value for money, drawing comparisons to
both higher-priced competitors and lower-quality products. Highlighting long-lasting freshness,
superior taste, and quality ingredients can justify a mid-level price while building a superior image.
Integrated Marketing Communications (IMC) Theory
The IMC theory emphasizes the importance of a consistent message across all marketing channels to
build brand awareness and a strong brand image.
● Consistent Messaging: Lay’s should use a unified message across all platforms (TV, radio,
billboards, promotions) to reinforce its core brand identity, focusing on quality, taste, and freshness.
The inconsistency in the Hungarian market, where competitors like Chio dominated TV and radio
while Lay's was limited to billboards, weakened the brand image.
● Multi-Channel Approach: To effectively reach a broad audience, Lay’s should expand beyond
outdoor billboards. Given the Hungarian consumer behavior, incorporating TV ads, radio spots,
and in-store promotions would ensure broader reach and better engagement with the target
audience.
● Synergy Across Channels: The IMC theory stresses the importance of synergy. For example, TV
ads could introduce a new product feature, radio jingles could reinforce the same message through
catchy tunes, while in-store promotions could push the final purchasing decision
Marketing Comparison: India vs. Hungary values

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Consumer Behaviour

Lay’s Potato Chips in Hungary

Est in 1965 → Merger of Pepsi-Cola + Frito-Lay

Traditional Snacks (49%)

❏ Perception → Packaging and Brand Image

● Leader with 47% market share in Q1 1990.

● Held 28% market share.

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