CUISINART STRATEGIC
PORTFOLIO PLAN
Laura Mattis
Portfolio Planning, Spring 2013
CUISINART COMPANY BACKGROUND
Cuisinart was founded in 1971 by Carl J. Sontheimer, a retired physicist and entrepreneur who
invented a microwave direction finder used by NASA in a moon mission. The Cuisinart Food
Processor was released in the US in the mid-1970s and earned celebrity chef endorsements
from Julia Child and James Beard in major publications like Gourmet and The New York Times,
helping the “phenomenal food processor” quickly become an indispensable product in the
home kitchen. At the peak of its popularity in 1986, the company sold 6 million units a year,
totaling $70 million in sales.
But company sales crashed in 1989 due in part to market saturation and competing products,
and Cuisinart was acquired by the Conair Corporation for $17.1 million. Since the acquisition,
Cuisinart has greatly expanded its portfolio to other countertop kitchen appliances and
cooking tools, sometimes through strategic partnerships. The company now produces food
choppers, coffeemakers, toaster ovens, cookware, bakeware, and espresso makers, in addition
to handheld gadgets, kitchen tools and specialty cooking appliances.
Cuisinart also backs culinary education, through its sponsorship of cooking education and
entertainment. This includes three public television cooking series: Chef ’s Eric Ripert’s
“Avec Eric”, Chef Hubert Keller’s “Hubert Keller: Secrets of a Chef”, and Jacques Pépin’s “Jacques
Pépin: Fast Food My Way”. Johnson & Wales University recently unveiled the 82,000 square foot
Cuisinart Center for Culinary Excellence in Providence, Rhode Island.
The company has been recognized for quality and design of their marketing, cookware and
specialty appliances, including a 2009 Chicago Athenaeum Green Good Design Award and two
2009 Shape You Top Gear of the Year Awards.
Stats
Wholly Owned Subsidiary of Conair Corporation
Located in Stamford, Connecticut
1001-5000 employees
Products
Bakeware
Blenders
Brick Ovens
Coffeemakers
Cookware
Countertop Cooking Appliances
Food Processors
Frozen Treat Makers
Hand Mixers
Kitchen Tools & Gadgets
Microwaves
Pizza Ovens
Stand Mixers
Toaster Ovens
Water Filtration
Specialty Products
Cuisinart Baby
Simple & Enticing Recipes Cookbook
CuisinArt Resort & Spa
Laura Mattis | Cuisinart Product Portfolio: Review & Recommendations | 2
INDUSTRY LANDSCAPE & MARKET TRENDS
Exponential Growth
Cuisinart created the food processor niche of the small appliances
market when they introduced their product in 1973. Within a few
years, Faberware, Waring, GE, Hamilton Beach and others joined
the fray with competing products. But, Cusinart led in market share
with the highest price tag and best performance.
Food Processor Product Lifecycle
Reaching Maturity Early
Within 15 years, the food processor market had become so saturated
that many people who wanted the devices already had them; an
estimated 43% of all homes had a food processor. Because of the
long buying cycle of food processor, sales slumped; in fact, it’s not
uncommon for the first generation of Cuisinart food processors to
be functional today. New kitchen products like small food chopper/
grinders also pinched sales.
Small Appliances Stay Strong In Poor Economic
Conditions
Introduction
(1973)
Growth
(1975-1989)
Even in economic downturns, consumer spending on all categories
of small kitchen appliances and housewares remains steady.
Consumers spend more time at home and value modern, convenient
appliances that save them time and effort.
In 2010, the total small kitchen device market increased 2.1% to $5.2
billion. Coffee/espresso makers represented almost $1.5 billion and
food processors accounted for $405 million, just behind blenders
($570 million) and mixers ($523 million). By contrast, total major
appliances including refrigerators, washing machines, dishwashers
and ovens decreased 5.1% to $19.1 billion.
22% of households with less than
10K household income have a food
processor, over 45% of households
over 70K in income have a food
processor, and 37% have a mini
food processor.
In such a mature market, Cuisinart and its competitors must
differentiate themselves, or risk entering decline as other
companies or products take over.
NPD Group, Kitchen Audit 2011
Maturity
(1989-Present)
EMERGING CONSUMER TRENDS
Spender
(High Cost)
Serious
Home Chefs
Consumers Are Cooking – A Lot
According to a 2012 survey by Share Our Strength, 78% of
low-income families cook and eat dinner at home five or more
nights a week, with price and time being the most agreed
upon barrier to healthy cooking. And when families cook
often, they typically cook from scratch.
Changing Demographics
Shifts in home sizes and family roles are having an impact
on who is cooking and how. Men now handle 33% of cooking
chores and are more likely to love cooking than women. Also,
as populations shift toward urban environments, consumers
have to work in smaller kitchens and prefer to buy multifunctional products that optimize their limited space.
Newlyweds/
New Home Buyer
Professional
Chefs
Sightseers
Hobby
Work
Busy Home
Cooks
Experimenting In The Kitchen
Harris Interactive found that across all socio-economic
levels, 79% of consumers enjoy cooking. In addition,
interest is increasing in local foods, artisanal ingredients
and environmental issues and is fueling a more conscious
approach to food selection and preparation. In 2012, more
than 56% of home cooks tried making a smoothie or fresh
juice last year and most of them tried it for health reasons,
according to Allrecipes.com.
Social Media Influence
Social media sites like Pinterest and Instagram are prime
candidates for dinner inspiration; 57% of consumers
interacted with food content on Pinterest in 2012. So far
this has had a nominal impact on cooking behavior because
looking at food or collecting recipes is considerably easier
than the perceived effort required to cook those recipes.
(Low Cost)
Frugal
Food Sightseers
These food
“window
shoppers” have
aspirations
to cook great
meals and
treats, thanks
to social media
and recipe
aggregators, but
rarely step inside
the kitchen.
Newlyweds
/ New Home
Buyers
These food
processor buyers
are looking
to stock their
kitchen with the
gadgets they
need.
Busy Home
Cooks
These cooks rely
on the recipes
they know and
use shortcuts
to quickly feed
their families.
Serious Home
Chefs
Cooking is a
fun activity,
and these
chefs enjoy
experimenting
with new
dishes and
entertaining.
Professional
Chefs
These people
made a career
out of cooking
or are looking
to. They produce
in great volumes
and Cuisinart
products are
an business
investment.
Laura Mattis | Cuisinart Product Portfolio: Review & Recommendations | 4
CUISINART’S FOOD PROCESSOR PORTFOLIO
Cuisinart offers 16 food processor models that range across the
entire price and customer segment spectrum. It is unclear what
the distinction is between the “Prep”, “Custom” and “Pro” models,
however “Elite” models are considered the top-tier, highest-
Food Sightseers
performing products of the portfolio. This chart does not include
the 20 food processors discontinued as of March 2013. Each product,
current and discontinued, is supported by a suite of slicing disks,
bowls and replacement parts.
Newlyweds &
New Home Buyers
Busy
Home Cooks
Serious
Home Chefs
Professional
Chefs
Over $300
20-Cup Food
Processor
$200-$299
Cuisinart has focused their portfolio on mid-tohigh capacity machines at a high price range. The
distinction between the models is based on capacity,
power, number of bowls, slicing disks and nominal
aesthetic differences.
Elite Collection
12-Cup Food
Processor
Elite Collection
14-Cup Food
Processor
$100-$199
Pro Custom 11
Food Processor
Custom 14
Food Processor
7-Cup Food
Processor
Pro Classic
Food Processor
$0-$99
Mini-Prep
Plus 4-Cup
Food Processor
Mini-Prep
Processor
Elite Collection
4-Cup Chopper/
Grinder
Prep 7®
7-Cup Food
Processor
Prep 11® Plus
11-Cup Food
Processor
Prep 9®
9-Cup Food
Processor
Mini-Prep
Plus Processor
Mini-Mate Plus
Chopper/Grinder
Spice & Nut
Grinder
Laura Mattis | Cuisinart Product Portfolio: Review & Recommendations | 5
FOOD PROCESSOR COMPETITOR ANALYSIS
Product
Leadership
Product
Leadership
Product
Leadership
Cuisinart (Mostly) Leads The Pack
Compared to its main competitors, Cuisinart has set
a premium on offering consumers the most features,
styles and power. But, food processor operation varies
little between brands and has not changed much since
the 1970s.
Facing A Category Leader
KitchenAid has a strong reputation in developing reliable,
high performance stand mixers. Like food processors,
stand mixers are considered an kitchen investment.
KitchenAid’s entrance into the food processor market
directly challenges Cuisinart’s product leadership. In
order to fend off KitchenAid, Cuisinart must ensure they
maintain their reputation for quality products.
Lots Of Budget Options
Customization
Operational
Efficiency
Cuisinart
Cuisinart food processors
are consistently top rated
and come in a large variety
of sizes and strengths. The
products are only available
in high-end department and
specialty stores.
Black & Decker, Oster and Hamilton Beach occupy the
lowest price brackets in all market segments. The most
expensive products are priced at less than $100, while
the average Cuisinart machine costs twice that.
Cuisinart
But, these products offer fewer features, such as
KitchenAid
available capacity and slicing options.
Customization
Operational
Efficiency
KitchenAid
Standing mixers are
KitchenAid’s flagship
product. However, they
offer food processors at
comparable price points
and markets to Cuisinart,
but with fewer options.
Customization
Operational
Efficiency
Black & Decker, Oster
Hamilton-Beach,
These inexpensive products
can be picked up at most
major, big-box stores.
Hamilton
Beach
Black &
Decker
Price
Ease
of Use
Optional Blades/
Features
Speed/
Power
Ease of
Cleaning
Ease of
Storage
Color/Styles
Laura Mattis | Cuisinart Product Portfolio: Review & Recommendations | 6
FOOD PROCESSOR COMPETITOR ANALYSIS, CONT.
A Crowded Competitive Landscape
Using an averagely-priced product from
Cuisinart’s product portfolio, it’s quickly
apparent that one of Cuisinart’s
leading competitors is itself.
With so many varieties
within the form and
category, Cuisinart can
be attributed to some of
the market clutter.
Hamilton Beach
Big Mouth Duo
14-Cup
Elite Collection
12-Cup Food
Processor
Hamilton Beach
Big Mouth 14-Cup
KitchenAid
12-Cup Ultra
Wide Mouth
Cuisinart
Custom 14
KitchenAid 13-Cup
Cuisinart Pro
Classic
Black & Decker
PowerPro Wide
Mouth
Category:
Consumer Level
Food Processors
Generic:
Small Kitchen
Appliances
Cuisinart
Mini-Prep
Plus 4-Cup
Blender
Cuisinart
7-Cup
Electric
Skillet
Slow
Cooker
Hamilton Beach
ChefPrep 500/525
Cuisinart Pro
KitchenAid Custom 11
Cook For
The Cure
Braun
Multiquick 3
Hamilton Beach
Big Mouth Duo
Black & Decker
8-Cup
Juicer
Coffee
Machine
Hamilton Beach
Bowl Scrapper
Breville
Sous Chef
Cuisinart Elite
Collection
14-Cup
Form:
Large Capacity,
Multiple Bowl
Food Processor
The Cuisinart food
Cuisinart
processor occupies
Prep 9
9-Cup
market spaces that
are also cluttered
Cuisinart
with irregularly used,
Prep 11 Plus
niche products
11-Cup
designed for single
Popcorn
Cuisinart
Maker
purposes, such as the
Prep 7
fondue pot or food
7-Cup
dehydrator. But, food
processors, in particular
Bread Maker
Cuisinarts, are among
the most expensive
Food
small appliances and
Dehydrator
represents a bigger loss to the
consumer because they must
assume the product will pay for itself.
Cuisinart
Mini-Prep
Electric
Kettle
Deep Fryer
Hand
Mixer
Small
Kitchen
Table
Range
Hood
Mini
Refrigerator
Toaster
Oven
Stand Mixer
2 Weeks of
Groceries
Fondue Pot
Rice Cooker
Griddle
Personal
Chef
Ice Cream Machine
Microwave
Budget:
$249 Kitchen & Home
Items
Laura Mattis
Beer/Wine
Refrigerator
| Cuisinart Product Portfolio: Review & Recommendations | 7
OPTIONS FOR CUISINART
New Market
Education & Support
In the mature food processor market, Cuisinart could
differentiate themselves from their competitors by
considering compliments to their product portfolio. Cuisinart
has historically sponsored cooking shows as an educational
and marketing vehicle, but high-touch interactions may be
the most beneficial. In order to appeal to serious consumer
cooks, Cuisinart could also leverage cooks’ creativity and
consider innovative ways to keep them experimenting in the
kitchen. This experimentation will ensure that Cuisinart food
processors remain key tools to the cooking process.
Penetrate
In order to penetrate the current market with existing
products, Cuisinart should consider reducing their overall
lineup to simplify options for new food processor buyers.
Local Cooking Classes/
Tastings
Cuisinart Cook-offs
Existing Market
Cook Mentors
Combine Cooking Actions
(slice/steam, dice/saute)
Newlywed Gift Set
Composting Bin
Attachment
Extend
Innovate
Eliminate Professional
Suite of Processors
Stylish Designs
Expand Dissemination
Channels
Easy to Store/Clean
Products
Market Product’s Versatility
Handheld Product for
Quick Jobs
Penetrate
Expand
Expand
Current products best serve the informed consumer but the
addition of simpler, more stylish machines could encourage
current owners to upgrade or compliment their existing
products.
Existing Products
New Products
Extend
Cuisinart can reach new markets through linking food
preparation to the broader social experience and context
of food.
Innovate
Augmenting future products to tackle additional food prep
steps in a single machine could position Cuisinart food
processors as the tool to have in the kitchen.
Laura Mattis | Cuisinart Product Portfolio: Review & Recommendations | 8
PORTFOLIO RECOMMENDATIONS
Option 1:
Local Cooking Classes/Tastings
Extend Cuisinart Products Into
Social Experiences
Extend
Penetrate
Innovate
Expand
Food preparation is a means to creating
a meal for those we care about. Cuisinart
could develop activities and experiences
that tap into the social aspects of
cooking.
Cuisinart should return to its roots of product demonstrations, by offering social activities
focused on food preparation and sharing. Small local events provide an intimate setting to
bond with others and could appeal to any consumer looking for a novel activity.
Cuisinart Cook-Offs
Cook-offs, or cooking contests, give Cuisinart’s most passionate customers an opportunity
to show off their cooking skills and recipes. Such events could feature high profile judges,
attendee voting/tasting and merchandise.
Newlywed Gift Sets
Gift product bundles with custom packaging could provide a suite of customized cooking
tools, such as spatulas, mixing bowls and measuring cups that facilitate machine use.
Buyers could assemble the set in retail stores with assistance from an interactive display or
gift advisor.
Option 2:
Innovate How Consumers Use
Their Kitchens
Consumers are increasingly tempted
by convenience foods and non-cooking
activities, so it’s important to efficiently
use the cooking time that consumers
have. More cooks enter the kitchen,
they are increasingly faced with lots of choices on what
to invest in. With a creative lens of this crowded kitchen,
Cuisinart can serve a key role in managing the clutter.
Extend
Innovate
Penetrate
Expand
Cooking Mentors
Particularly for those cooks starting out or who are mildly interested in the idea of cooking,
Cuisinart can offer mentors who facilitate the learning process and act as coaches that
build new cooks’ confidence and excitement. By learning tips and tricks about the process,
these cooks can learn the best and most efficient ways around the kitchen.
Combine Cooking Actions
In an increasingly crowded kitchen, counter space is of the essence. Streamlined products
that take up minimal space and which achieve multiple tasks in the same meal will be more
likely to stay on the counter. By chopping and steaming vegetables in the same appliance,
cooks save time cooking and cleaning.
Composting Bin Attachment
Environmental conscious consumers may already have one set up in the backyard. But by
considering such an attachment, Cuisinart could provide any easy way to save scraps and
put waste to use.
Laura Mattis | Cuisinart Product Portfolio: Review & Recommendations | 9
REFERENCES
Company Background
Cuisinart. “Cuisinart Milestones.” Mar. 2011. http://www.cuisinart.com/about/timeline.html
Cuisinart. “The Cuisinart Story: Turning The Art Of Great Cooking Into An American Lifestyle.“ May 2010. http://www.cuisinart.com/about.html
Lemelson-MIT Program. “Inventor of the Week: Carl Sontheimer.” May 1998. http://web.mit.edu/invent/iow/sontheimer.html
PCWorld. “The Steve Jobs Biography: 5 Tidbits You Need To Read.” Oct 2011. http://www.pcworld.com/article/242277/steve_jobs_biography_5_tidbits_you_need_to_read.html
Industry Landscape
The Wall Street Journal. “The Gifts On Every Wedding List.” June 2011. http://online.wsj.com/article/SB10001424052702304906004576371352048939270.html
New York Times. “What’s In Your Kitchen.” December 2011. http://well.blogs.nytimes.com/2011/12/13/whats-in-your-kitchen/
The Wall Street Journal. “For Appliance Makers, Less Is More.” May 2012. http://online.wsj.com/article/SB10001424052702303879604577410193241593100.html
The Chicago Sun-Times. “The Food Processor Turns 40.” Sept. 2012. http://www.suntimes.com/lifestyles/food/3429100-423/processor-says-gilletz-cuisinart-recipes.html
The New York Times. “How Cuisinart Lost Its Edge.” Apr. 1990. http://www.nytimes.com/1990/04/15/magazine/how-cuisinart-lost-its-edge.html?pagewanted=all&src=pm
ApplianceMagazine.com. “Small Appliance Market Will Stay Strong “ Jan. 2008. http://www.appliancemagazine.com/editorial.php?article=1902&zone=1&first=1
Cooks Illustrated. “Food Processors.” Jan 2013. http://www.cooksillustrated.com/equipment/overview.asp?docid=26352
Harris Interactive. “Three in Ten Americans Love to Cook, While One in Five Do Not Enjoy It or Don’t Cook.” Jul. 2010. http://www.harrisinteractive.com/NewsRoom/HarrisPolls/tabid/447/mid/1508/
articleId/444/ctl/ReadCustom%20Default/Default.aspx
AllRecipes.com. The Measuring Cup: 2013 Trends: What Americans are Cooking & Eating.” Jan 2013. http://press.allrecipes.com/wp-content/uploads/Allrecipes-Measuring-Cup-Jan-2013-WEB.pdf
JWT Intelligence. “What’s Cooking? Trends In Food.” Feb. 2012. http://www.slideshare.net/jwtintelligence/whats-cooking-trends-in-food
Compete. “Pinning Down the Impact of Pinterest.” June 2012. http://blog.compete.com/2012/06/28/pinning-down-the-impact-of-pinterest/
The New York Times. “So, Wait, People Are Cooking?“ http://bittman.blogs.nytimes.com/2012/02/01/wait-so-people-are-cooking/
Competitor Analysis
Cooking.com. “Top Rated Food Processors.” Feb 2013. http://www.cooking.com/top_food-processors_45-91-4294966687_p01/
MarketResearch.com. “Small Kitchen Appliances In The U.S.” Dec 2006. http://academic.marketresearch.com.ezproxy.gl.iit.edu/product/display.asp?productid=1281485
NPD Group. “NPD’s Kitchen Audit 2011 Study Information Preview.” https://www.npd.com/lps/pdf/Kitchen_Audit_Information_Preview.pdf
IBISWorld. “Food Processor & Blender Manufacturing in the US: Market Research Report.” Sept. 2011. http://www.ibisworld.com/industry/food-processor-blender-manufacturing.html
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