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In 1986, Frito-Lay introduced its first sour cream-based, shelf-stable dip. Its French onion flavor was viewed as an ideal accent for the company’s potato chips. The problem that Frito-Lay faced however was that they didn’t know if they wanted to market this new sour cream-based, shelf-stable dip in the chip dip market or the vegetable dip market. One view was that the dip line should be more aggressively promoted in its present market segment. This segment is known as the “chip dip” category. The other view was that Frito-Lay should actively pursue the “vegetable dip” category.
Choosing to continue in the chip dip market would be an easy avenue for Frito-Lay because they already have a strong foothold and consumer base in that particular market...
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