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Complete SWOT Analysis of Lay’s – A Very Popular Chips Brand All Over The Globe

by | Case Studies | 0 comments

Previously, we did the flavourful marketing mix of Lay’s. This time we are going to do a flavourful but yet delightful SWOT analysis of Lay’s – A very popular chips brand all over the globe.

Whenever there is any party, occasion or event we are watching a cricket match the first thing to eat as a snack comes to our mind is Lay’s. And yes that’s how lay’s converted these occasions as an opportunity to market its products among the customers. 

Lay’s was the first snack production company that used traditional commercials for marketing. Besides commercial ads, they also tried digital marketing and got immense success over it. In this digital era where almost every business is going online, digital marketing has become very important in today’s world and if you want to learn and gain more knowledge about it, go over to our Free MasterClass On Digital Marketing 101 by Karan Shah, the CEO and Founder of IIDE. 

In this case study, we will learn about the SWOT Analysis of Lay’s. But first, let us know about the company and the product better.

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About Lay’s

SWOT Analysis of Lay's - Mr Herman Lay The Founder of Lay’s
(Mr Herman Lay The Founder of Lay’s, Source: IIDE Creator)

Lay’s is a very popular chips brand all over the globe, it was started in late 1940, and it contains a lot of outlets worldwide. This potato chips brand was owned by Frito Lay’s with a turnover of 1.2 billion USD. This brand contains different popular variants and it is sold in around 200 different countries with 200 different flavours. 

The chips were sold for the first time in the 1930s by Herman W.Lays. W.Lays and Fritos were a competitor before but eventually, they became partners in 1961 and formed the brand Frito-Lay. Lay’s was first founded in the US and it has been produced by Frito-lay’s and is now owned by PepsiCo since 1965. Lay’s was launched in India in 1965 and since has a large network with huge popularity.

Quick Stats on Lay’s
Founder Herman Lay
Year Founded 1940
Origin United States
No. of Employees 60,000+
Company Type Public
Market Cap $ 222.8 Billion (2021)
Annual Revenue $ 500 Million (2021)
Net Income/ Profit $ 67 Million (2020)

 

SWOT Analysis of Lay's - Product Lay’s
(Product | Lay’s, Source: Lay’s) 


Products of Lay’s
  

  • Lay’s 
  • Lay’s Dips
  • Lay’s Kettle Cooked
  • Lay’s Poppables 
  • Lay’s Stax
  • Lay’s Wavy


Competitors of Lay’s

  • Kellogg’s Pringle
  • Kurkure
  • Bingo
  • Haldirams
  • Parle Wafers
  • Diamond Wafers
  • Piknik


As now we have a better understanding of Lay’s, let’s look into the SWOT Analysis of Lay’s.


SWOT Analysis of Lay’s

SWOT stands for strengths, weaknesses, opportunities, and strengths. So, a SWOT analysis is a technique to assess these four important aspects of the businesses. Companies can use SWOT analysis to make the most of what the businesses have got, to the organization’s best advantage. And you can reduce the chances of failure by understanding what the business is lacking, and eliminating hazards that would otherwise catch your unawareness. 

SWOT Analysis of Lay's - SWOT Infographics of Lay's

So let us go ahead and first have a glance at the strengths of Lay’s from the SWOT analysis of Lay’s

Strengths of Lay’s

  • First Name Advantage: Lay’s was the first brand that started selling chips worldwide with a revenue of 1.3 billion USD. 
  • Located in Remote Locations Too: Lay’s has also been located in remote locations which lead to an increase in their brand awareness. 
  • Strong Distribution Network: Also Lay’s has a huge distribution network with various flavours which also attract all types of target audiences. 
  • Loyal Dealers & Customers: They also have a strong dealer network with loyal customers worldwide.
  • Youngsters Being Their Strength: They target specifically youngsters and the middle class which helps them to grow their network. 
  • Tie-up With Pepsi: Lay’s is owned by PepsiCo company which is a highly recognized company in the world that can target their own loyal Pepsi customers. 
  • Market Share: Lay’s had a piece of the pie of 50.2% of the overall industry while in the US it was 29.6% of the potato chips market.
  • A Mix of Traditional & Digital Marketing: Lay’s perfectly blended its traditional and digital marketing strategies relating with well-known slogans like betcha can’t eat only one and be a little dialogical.  

SWOT Analysis of Lay's - Lay’s Smiling Influencer Campaign on Instagram
(Lay’s Smiling Influencer Campaign on Instagram, Source: Campaign India) 

Amazing Fact: Lay’s is the only chips brand with nearly a million followers on Instagram, leaving Pringle & Kurkure behind. Lay’s creative content strategy, high-quality ad design and maintaining an online reputation with customer interaction led Lay’s to get enormous success on social media. Isn’t this amazing? 

If you also want to obtain expertise in certain skills of digital marketing such as content strategy, ad designing, online reputation management and many more then IIDE offers several short term courses in digital marketing for the same. Enrol in one or more of your favourite courses and start enjoying learning with a packet of Lay’s from the comfort of your home.


Weaknesses of Lay’s

  • Health Concern Among People: As Lay’s is a high-calorie snack containing a high amount of fats, people are now more concerned with their health which reduces the product sales of Lay’s. 
  • Uncertain Activities: Due to some doppelganger activity and memes affects the reputation of Lay’s. 
  • Non-recyclable Packing: Lays packaging is non-recyclable which affects the reputation of the company. 


Opportunities for Lay’s

  • Disposable Income: Due to the high amount of disposable income in emerging countries, the consumption of snacks also increases which leads to an increase in sales of Lay’s. 
  • Increase in Tourism: After the release of lockdown, there is an increase in tourism activity which leads to tourists purchasing Lay’s for travelling, this enhances the growth of the company.
  • Focus on Youngsters: As Lay’s is one of the favourite snacks among kids and youngsters, Lay’s should start working to divert its marketing efforts towards this age group.
  • Innovation in Flavours: Lay’s is famous among customers for its flavours and it should continue launching new flavours in the market to increase the craze of Lay’s among people.
  • Rural Market: Lay’s are famous in the rural market and also it’s available in any region which leads to increase its customer base and revenue. 
  • Occasions: In India, Lay’s are preferred more in festivals and parties. This is one of the opportunities for Lay’s to start pitching its products more during these occasions. Shifting its R&D and marketing efforts towards the opportunity. 


Threats to Lay’s

  • Boycott: Lay’s are usually boycotted by health-conscious people which leads to lower demand for Lay’s. 
  • Lower Margin due to Competition: As the growing scale in local distribution, there is a high amount of competition between the competitors which leads to a lower margin.
  • Price Fluctuation of Raw Material: Lay’s raw material is potato and price fluctuation of this raw material might affect the cost of the final product.  
  • Not Worth The Money: Lay’s been hated among people due to Lay’s providing less quantity in the exchange of money. The taste of Lay’s is an all-time classic but Lay’s has started compromising on providing quantity. 
  • Negative Feedback from Sports Celebrities: Recently, Coca Cola got a negative review from the famous football player Cristiano Ronaldo. Just like this if Lay’s get some negative feedback from sports personalities because of its unhealthy factors then this might affect the brand value of Lay’s among the people.

This ends our complete SWOT analysis of Lay’s. Let us conclude our learning below.

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To Conclude

Lay’s is a well-versed snack brand that has been established. It is one of its kind of snack brand. The band has done its strategies well to stand its position on the continent. Lay’s has to work on launching healthy variants of its product so that Lay’s can get rid of some uncertain boycotts. 

But being such a huge brand serving chips and products across multiple countries, Lay’s should continue to innovate and develop more products and launch them in the market with the best possible marketing strategies.

Especially digital marketing which is vital in today’s growing and expanding world, to get better results and to remain competitive in the market. If you don’t have any idea of what digital marketing is or want to learn more about it and upgrade yourself, here is IIDE’s 3 Month Advanced Online Digital Marketing Course to know more.

We hope this blog on the SWOT analysis of Lay’s has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.

If you enjoy in-depth company research just like the SWOT analysis of Lay’s, check out our IIDE Knowledge portal for more fascinating case studies.

Thank you for taking the time to read this, and do share your thoughts on this case study of the SWOT analysis of Lay’s in the comments section below.

Lead Trainer & Head of Learning & Development at IIDE

Leads the Learning & Development segment at IIDE. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. He has been a guest speaker at prominent colleges in India including IIMs......[Read full bio]

Aditya Shastri

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