solution

There are 2 questions for each case. Your grade will reflect how well you answer them and how you incorporate concepts from the course in your answers

Doritos
Doritos were first introduced to the market in 1966 as a taco flavored corn chip, with Toasted Corn and
Nacho Cheese added in the following years. Currently, over a dozen flavor varieties are offered.
Distribution for Doritos consists primarily of grocery stores, convenience stores, and vending machines.
The strong brand name has allowed Doritos to gain prime shelf space in grocery stores and convenience
stores for predominant displays and better promotion position. As market leader with 78% control of the
tortilla chip market, there is little competition for Doritos within this market. However, looking across
the snack category, Doritos has competition from brands of potato chips, Chex Mix, and Cheetos as well
as nuts and pretzels.

Doritos Brand
The Doritos brand represents a bold flavor experience and has continued to be the tortilla chip leader in
the “salty snack” category, with almost universal appeal. Doritos has been endorsed by popular
celebrities, held breakthrough advertising campaigns at the Super Bowl, and boasts an online fan club,
all of which are a great source of brand equity, loyalty, and recognition.

2Brand research was conducted in 2012 employing a combination of surveys, focus groups, and collages
to define the brand’s image amongst consumers. The resulting brand map included five core
associations: Chip, Triangle, Cheesy, Crunchy, and Orange. These associations speak to the iconic shape
(triangle) and dominant Nacho variety (cheesy, orange). The secondary associations reflect usage
occasions for consuming Doritos (football, party, snack), flavors (Cool Ranch, Nacho), and packaging
(red bag). However, the secondary associations also include several negative associations, such as
unhealthy, salty, and bad breath.

The “Better for You” Doritos Introduction
In the past decade, many companies in the food industry have launched products that are healthier
alternatives for consumers. Companies have reformulated existing products or have developed new
products with fewer calories, salt, fat, and additives.

In this vein, food scientists have formulated a new version of Doritos that is “better for you” than the
original versions. The new Doritos are made of organic corn meal, offering a lower calorie snack with
very few additives, very little salt, and less fat. To reduce food additives, this new variety has a simple
corn flavor, without the added cheese, nacho, BBQ, or ranch flavorings found in the regular Doritos line.
This version has been dubbed internally as “Doritos Free” during the development process to signify
that it is relatively free of additives, salt, and fat. Taste tests conducted in test kitchens suggest a
promising future for the product. When tested against other natural and low fat chips, 80% of consumers
prefer the taste of Doritos Free. However, as is the case with many healthier food formulations, the taste
of Doritos Free loses when tested against the regular corn flavor of regular Doritos—60% of consumers
prefer the taste of regular Doritos over Doritos Free.

In preparing for the launch of the new Doritos product, several issues remain. Particularly important is
the branding decision—how should the new Doritos version be named? One option is to use the name
“Doritos Natural” that would signal to consumers that the product is free of many of the unhealthy
ingredients of the regular versions. A second option being considered is to use a brand with less
emphasis on the Doritos name, such as “GoodChips by Doritos.” This option is being considered
because several people on the marketing team feel that “Doritos Natural” is not an appropriate name for
the healthier Doritos product as it is not completely free of additives, salt, and fat. A third option is to
launch the new product under an entirely different brand name, such as “GoodChips,” without
mentioning any connection with the Doritos brand.

Questions
1. Consider the three branding options for the new healthier version of Doritos. Using your
knowledge of brand architecture, how would you label each of these options—branded house,
house of brands, subbrands, or endorsed brands? You do not have to explain why you are using
these labels—just provide the labels. (15 points)

2. Which branding option do you recommend—and why? In your answer, evaluate the advantages
and disadvantages of all three branding options. (35 points)