Date post: | 16-Aug-2015 |
Category: |
Marketing |
Upload: | sameer-mathur |
View: | 25 times |
Download: | 2 times |
Company Background
70%
20%
5% 5%
Revenues
Bratwurst Breakfast sausageVIVIO Italian sausage Store brand products
Manufactured fresh pork sausage products
2005 revenues of about $1.5 billion
Sold via national and regional distributors, yet little presence in North-eastern markets.
Decision Makers
Anne Banks• Product Marketing Director
Steve Sears• VP of Marketing
Laura Bishop• Director of Market Research
Project Score• A team of 10 people from the R&D, Packaging, Graphic, Marketing and Sales Department.
Objectives of the company
• To launch a national Italian sausage brand to achieve the company’s profit objectives• To create a well thought out positioning plan to become a national
category leader.• To assess the Italian opportunity by doing ample qualitative and
quantitative research.
Objectives of the case
• To develop a new product for increasing profitability.• To understand the positioning of a new brand.• To make use of qualitative and quantitative research to understand
customers’ behaviours and needs.• To develop a distinct product to align its attributes and core values of
the customers.
Situation Analysis
• Vivio entered the Italian sausage market in 2002 in North-east where brats were not a staple food.• Was priced comparably to other regional competitors.• Positioned as “fresh Italian sausage” and “locally made” with an Italian flag on
the packaging.• Had an annual growth of 9% in 2004 & 15% in 2005• Brat sales had been flat; Breakfast sausage had a double digit revenue decline
in 2005• An extensive research was carried out to assess the Italian opportunity • Develop a national product to increase profitability and reduce cannibalization
Key Issues
• Should the product be developed under the Vivio name, as a new brand or utilize the Saxonville name to leverage the company’s brand equity?• What are the core values of the customers which can be incorporated
into the positioning?• How to prevent cannibalization of the company’s other products?• How to distribute outside the core geography ?
VIVIO’s Background
• It entered the Italian sausage industry in 2002 in the North-east where brats were not a staple food.• Was given an Italian name to overshadow the company’s German
heritage.• Was priced comparably to other regional competitors.• Initially sold through in-store sampling, discounts and deals to
establish itself.• Had an annual growth of 9% in 2004 & 15% in 2005
POSITIONING:• Fresh and locally made-Transparent packaging • Authentic Italian heritage-Italian flag on the packaging.
PROMOTION:• Base trade spending• Multiple facings
Research and EvaluationSTEP 1:Planning new research on the target customers
• Formation of 4 mini pilot groups in a Pennsylvania research facility. Each group contained 4-6 users-men and women aged 25-50 who either used branded or store-brand products.• OBJECTIVE: To understand the benefits Italian sausage delivered.• Recruitment,Screening & selection of consumers for focus groups to
be conducted in selected locations. Women were the primary purchasers.• 103 women had qualified for the sessions.
Step 2:Findings from focus groups on Italian sausages
Italian sausage consumers by purchase
Heavy Users:Once a week during fall
& winter months.Once every 2 weeks
during spring & summer.
Medium users Light users: Once every 6 weeks
• Quick and enjoyable meal for family.• Cooking was done for evening dinners.• Considered a great meal-maker.Used as an
ingredient in sauces,soups.
VIVIO:• Considered to be of exceptionally
high quality and great taste.• “The Family Company”• However Bratwurst was a poor
brand name due to German heritage
• Vivio ranked 7th in a list of 20 brand names.
• Family connection• Clever Cooking• Confidence• Appreciation• Quick and Easy• Tradition
STEP 3:Building Positioning Concepts
• “Brand ladders” were built with a core value at the highest preference.
CORE VALUE: The woman doing a good job as a mother & a homemaker.• Four mock concepts were decided. Consumers were asked to select &
prioritize their favourites.“Family Connection” and “Clever Cooking” received the highest votes with Family connection receiving the most first-place votes.
STEP 4:Additional quantitative research• Field-testing of “Family connection” & “Clever cooking” concepts with
250 & 256 target customers to understand their likelihood to purchase.• Both concepts were viable.• Family connection had scored better due to the word “Italian”
implying family.
RecommendationsHow to launch and position a national Italian sausage brand to achieve the company’s profit objectives?
Family connection Clever CookingPROS:• Italian heritage resonates with the concept of
family and togetherness.• The woman is the magnet that pulls everyone
in.• 81% would definitely/probably buy• One of the core values of the target consumer
CONS:• Cannibalization of other products.• Common concept
PROS:• Projects herself as a good cook with her own
recipes• Can be used in different ways• Less cannibalization• 41% would definitely buy it.• Rated high in perceptual maps i.e. can be
associated with Family.• Easier to provide tactical support
CONS:• Does not align with the Italian family concept.
Clever cooking should be the brand positioning.
Should the product be developed under the Vivio name, as a new brand or utilize the Saxonville name to leverage the company’s brand equity?
• Vivio brand had matched the level of Italian sausage growth in the retail sausage market; Annual growth rate of 9% in 2004 & 15% in 2005.• Contributed to 5% of the Saxonville revenues.• It can help tap markets where bratwursts & breakfast sausages can be introduced• Through base trade spending and multiple facings, it has already made
distribution gains.• Loyalists considered Vivio brand to be of exceptionally high quality.• Vivio ranked 7th in a list of 20 brand names.• Saxonville Italian sausage received a mixed response and might not resonate
because of its German seeming heritageTherefore the new products should be developed under VIVIO brand.
What are the core values of the customers which can be incorporated into the positioning?
• Women were the target customers.• CORE VALUE: The woman doing a good job
as a mother & a homemaker.• In the perceptual map, Italian sausage
ranked high on family-pleasing.• So a woman can be portrayed in a positive
light by being a magnet that pulls everyone together who can come up with her own recipes and add a little zest to her dishes.
Core value: Good dinner experience
Emotional benefit:
Satisfaction
Functional benefit: Ingredient for multiple
dishesQuick and easy
High quality, good solid to fat ratio and color,great taste and texture
How to prevent cannibalization of the company’s other products?
• Instead of developing a new brand, the new products will be developed under the VIVIO brand without affecting the sales of breakfast sausages and bratwursts.• Repositioning and proper promotions of Saxonville’s products• New markets can be tapped with the help of VIVIO brand to sell
Saxonville’s products.• “Clever cooking” brand positioning.
How to distribute outside the core geography ?
• Once the fresh and locally made Italian sausages positioning is successful at a national level, the company can expand their business to frozen ,smoked and semi-dried sausages.• No national players.29 regional competitors.
Created by Santa Nibedita, CET Bhubaneswar, during an internship by Prof. Sameer Mathur, IIM Lucknow.
www.IIMInternship.com