saxonville sausage company parampreet singh
TRANSCRIPT
Saxonville’s Background
• Saxonville was a 70-years old, family business and placed in Saxonville, Ohio.
• In 2005, the revenue approximately $ 1.5 billion.
• Produced a variety of pork sausage products: fresh sausage as opposed to smoked or semi-dried
Company Product
Product Market Revenues
Bratwurst Flat – No Growth
70%
Breakfast Sausage
Decline revenues
20%
Italian Sausage “Vivio”
Growth 5%
Store brand products
- 5%
The business consisted of branded products:
Revenue Percentage Contribution
70%
20%
5%5%
Revenue Percentage Contribution
BratwurstBreakfast sausageItalian sausage "Vivio"Store brand product
Market Product
• Bratwurst and Breakfast products sold throughout U.S via both national and regional brokers, distributors.
• The Italian sausage was the one category showing growth across producers in the retail sausage market, showing an annual rate of 9% in 2004 and 15% in 2005.
Market Product
• Very little distribution in store in the Northeastern markets.
• Saxonville’s Italian brand, Vivio although matched this level of category growth, it was available in only 16% of the nation’s large supermarkets primarily in Boston, New Jersey, New York, Maryland, and South Carolina.
Background of Saxonville's Italian Sausage Business
• Vivio entered the Italian sausage market in 2002.
• They made up an “Italian” name because they worried that people wouldn’t buy an Italian product from a ‘German heritage’ company.
Background of Saxonville's Italian Sausage Business
• Vivio was priced comparably to other regional Italian sausages.
• Current positioning of Vivio is “Vivio fresh Italian sausage” and has an Italian flag in one corner.
NO. 1:
1. Successful launch of a national Italian Sausage brand
– Take advantage of high annual
– growth rates (2004 – 9%, 2005 – 15%)
– Increase market share and – contribution to total revenues
Researching and Evaluating The Italian Opportunity
• Ann Banks formed a multifunctional task force, “Project Score”, included 10 collegues from the R&D, packaging and graphics, marketing, and sales departments.
• Find the ideal name for Saxonville’s line of Italian sausage.
• Four Steps to do positioning work.
Step One :
Planning New Research on the Target Customer
• Phase I : To confirm some of the basic information presented in the Attitude and Usage data.
Relevant data from latest A&U study:
• Female heads-of-household are primary purchasers of Italian sausage.
• Six out of the last 10 purchases given to a particular brand is considered “a loyalist.”
• Heavy users used Italian sausage three + times a month.
Relevant data from latest A&U study:
• Mean Italian sausage usage constituted two times every six weeks.
• Heaviest usage is among consumers aged 20–50 years.
• Age differentiation tends to manifest in 10 year increments.
PHASE 2:
- To understand current behaviors
- Triggers to purchase, and unmet needs
- To get a clear understanding of product benefit
- Attributes and ideals
- To develope a solid feel for core value and role
Step Two :
Building on Learning from the Focus Groups
• Ann and Bishop learned much about consumers behaviors from the focus group and developed a synopsis of the learning and sent it to every member of Project Score.
6 potential bases for positioning :
- Family Connection
- Clever Cooking
- Confidence
- Appreciation
- Quick and Easy
- Tradition
Step Three :
Building Positioning Concepts
• “Family Connection” and “Clever Cooking” received the highest total votes.
• The result shows that 81% of respondents would definitely or probably buys the product with a positioning focused on “Family Connection” and 72% if the company would use the “Clever Cooking” concept.
CONTD.
• On the other hand 41% would definitely buys the product with “Clever Cooking” concept and just 23% with “Family Connection” 4% would definitely not buys in case of the “Family Connection” position model, and only 2% in the case of “Clever Cooking” concept
• The group embed their ideas to a manageable list of R&D, graphics and sales tactics.
Step Four :
Additional Research Delivers a Verdict – or Two
• “Family Connection” had scored better and receiving the most first-place votes.
• Discuss how advertising look and feel, packaging, product attribute, name, considering sub-branding.
• Picked the winner from the two final concepts.
Possible Segmenting Dimension
• Working out of the home, part or full time vs working at home as a homemaker
• Head of household: female vs male
• Age: <10, 10-20, 20-30, 30-40, 40-50, >50
• Household income level: low, middle, or high
• Consumer group: heavy, medium, or light users
• Loyalist vs competitive users
Target Market
• Working out of the home and working at home
• Head of household: female and male
• Age: 20-50
• Household income level: middle and high
• Consumer group: heavy, medium, and light users
• Loyalist and competitive users
Positioning
• Wholesome meals with fresh ingredients
• Desire to please entire family with single dish
• Quick meal preparation without sacrificing nutritional quality
• Family dinner facilitating feelings of togetherness
–Discover a crowd-pleasing favorite that brings the family together
–Vivio - It welcomes you in
–The perfect blend of fresh herbs and spices, with irresistible aroma and taste will draw people together over a great and enjoyable meal
• Simply add your own personal touch to create meals that make any day a little special
• Vivio – Creative meals in minutes!
• Comes with recipes everyone is sure to love, unleash you creativity to create a wholesome real meal in minutes
• Vivio loyalist
• Competitive brand
• Degree of price sensitivity
• Frequency of every day dinner preparation
• Use of other product within company
• Currently in strong Italian sausage markets
• Strong Bratwurst markets where Saxonville well developed
• Strong Saxonville markets where Italian sausage is distributed
• Strong Saxonville markets where vivio is distributed
Revenue Calculation
• Vivio was only available in just 16% of supermarkets, our target is to reach 100% supermarkets
Vivio 2005 sales performance (from exhibit 2)
$ Vol of 16% market $ Vol of 100% market
Vivio Italian Sweet Sausage Link 24.41 oz $ 3,714,499.00 $ 23,215,618.75
Vivio Italian Hot Sausage Link 24.41 oz $ 18,858,587.00 $ 117,866,168.75
Vivio Italian Mild Sausage Link 24.41 oz $ 42,414,884.00 $ 265,093,025.00
Vivio Italian Mild Sausage Link 55 oz $ 2,829,047.00 $ 17,681,543.75
Vivio Italian Sweet Sausage Ground 14 oz $ 2,019,310.00 $ 12,620,687.50
Vivio Italian Hot Sausage Ground 14 oz $ 34,685.00 $ 216,781.25
Vivio Italian Mild Sausage Ground 14 oz $ 1,351,313.00 $ 8,445,706.25
Vivio Italian Cheese Sausage Link 14.7 oz $ 870,081.00 $ 5,438,006.25
Vivio Italian Pepper Sausage Link 14.9 oz $ 160,232.00 $ 1,001,450.00
Vivio Italian Garlic Sausage Link 14.7 oz $ 833,067.00 $ 5,206,668.75
Vivio Italian Mix Sausage Link 55 oz $ 1,235,193.00 $ 7,719,956.25
Total $ 74,320,898.00 $ 464,505,612.50
WEAKNESS
• Potential confusion of Italian named sausage, Vivio, from German named company, Saxonville
• No Comprehensive advertising campaign
• Possible cannibalism of similar products with portfolio
OPPORTUNITIES
• No national competitors of fresh Italian sausage
• Category shows growth across all product within portfolio
THREATS
• 29 regional barns with large percentage of market share according to geographic region
• Frozen product is currently distribute nationwide by a number of other companies
WHAT POSITIONING ???
•Positioning as a “Clever Cooking” concept could gain more benefits instead of “Family Connection” since the tendency to buy is higher, that consumers is definitely would buy with “Clever Cooking”.
NAME ???
• Ann Banks should stick with Vivio name. While Vivio hasn’t been a huge success to sausage market, change their name won’t give a huge effect because many customer has aware with the Vivio name. By changing name, it will confuse or alienate the few loyal customers the brand actually has.