Saxonville Sausage Company

SAXONVILLE SAUSAGE COMPANY

SHIVAM VERMA

IIT DELHI

HARVARD BUSINESS SCHOOL BRIEF CASE

SAXONVILLE SAUSAGE COMPANY

Saxonville was a 70-year-old, privately held family business headquartered in Saxonville, Ohio

2005 revenues of approximately $1.5 billion

Variety of pork fresh sausage as opposed to smoked or semi-dried

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BRANDS

Bratwurst (70% of Saxonville’s revenues)

Breakfast sausage, both links and patties (20% of revenues)

Italian sausage named Vivio (5% of revenues)

Store brand products accounted for the additional 5% of revenues

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PEOPLE

Ann Banks new Product Marketing Director

Laura Bishop Director of Market Research

Steve Sears Vice President of Marketing

Liz Keller a top brand Consultant

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SITUATION

Products sold through U.S. via national and regional brokers and distributors

Little distribution in north-eastern markets

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SITUATION (VIVIO THE BRAND)

First entered the Italian sausage market in 2002 in the Northeast

Priced comparably to other regional Italian sausages

First six months, shoppers tried it at a discount

A brand was born

Established relationships to introduce bratwurst to the eastern U.S.

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SITUATION

Bratwurst sales had been flat

Breakfast sausage had underperformed the market

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Double-digit revenue decline in December 2005

Italian Sausage 9% in 2004 & 15% in 2005

Vivio had matched level of category growth

Available in just 16% of nation’s large supermarkets

THE CHALLENGE

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Breakfast Category—

Not enough spending to compete with the big players

Fewer people are serving

Eaten more at special occasions and on weekends

Bratwurst Category

Fired their ad agency mid-year

Too late for campaign developed and fielded

Mainly prepared at outdoor barbeques

THE CHALLENGE (VIVIO)

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What is the ideal name for Saxonville’s line of Italian Sausage?

Should a national entrant continue with the vivio brand name or have a

different Italianate name ?

Utilize the Saxonville name to leverage the company’s heritage and

brand equity ?

POSITIONING OF VIVIO

A Styrofoam tray covered in plastic wrap, with a

label depicting coiled links of sausage next to a head

of garlic and an old-fashioned sausage grinder

The label covers most of the package, leaving

enough space so you can see the ‘look’ of the

sausage inside

It says ‘Vivio fresh Italian sausage’ and has an

Italian flag in one corner

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REGIONAL COMPETITIVE POSITIONING

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Mama Mia• ‘Authentic Italian Heritage’

Hertfordshire• ‘Freshly and locally made’

Paglia Brothers• Italian name• ‘locally grown’

‘PROJECT SCORE’

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10 Colleagues from R&D, packaging and graphics, marketing and sales department.

‘PROJECT SCORE’

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Summary of business Saxonville Sausage Brand and Market Facts

brand’s available line items by form and flavour Vivio 2005 Sales Performance

WHY HAS NO ONE REALIZED THE OPPORTUNITY TO DEVELOP A NATIONAL ITALIAN SAUSAGE BRAND? 14

Local brands have played up their ‘home grown’ heritage—the whole farm-to-market idea

Reluctance to think creatively about how to distribute outside your core geography

What about one of the national giants like Billy Bob or Country Home? Reconfiguring their whole distribution network to play in this category

RESEARCHING AND EVALUATING THE ITALIAN OPPORTUNITY

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Four step positioning process Qualitative research with target consumers to understand their behaviors and

needs

Sequential round of consumer sessions, where we’ll use the language we’ve heard to develop and then gain reactions to different positioning ideas

Refine all the new learning into actual concepts and have consumers prioritize and improve them

The concepts are put through monadic3 testing, we look at the purchase intent scores the testing generates

STEP ONE

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Phase I

• 4 highly interactive groups of 4-6 men & women aged 25-50

• Confirm basic information presented in Attitude and Usage Data

Phase II

• A&U data for recruiting participants• Understand current behaviors,

triggers to purchase, and unmet needs

• Get a clear understanding of product benefits

• Attributes and ideals• To develop a solid feel for core values

and the role the product plays• 103/437 females in focus groups

primary purchasers and preparers of Italian sausage

STEP TWO 17

Focus Group Synopsis analysed by every member

Women felt they had to trade off the time and skill to prepare an evening meal against the family members it would please

STEP TWO 18

Focus Group Synopsis analysed by every member

Women felt they had to trade off the time and skill to prepare an evening meal against the family members it would please

STEP TWO 19

Family Connection Clever Cooking Confidence Appreciation Quick and

Easy Tradition

6 Potential bases for Positioning

STEP THREE 20

• Discerning good taste

Value

• Makes me feel like a gourmet cook

Emotional Benefit

• Flavour enhancement that makes even the best recipes taste unbelievably better

Functional Benefit

• Smooth and light texture

Attributes

Brand Laddering example gourmet cooking oil

STEP THREE 21

Italian Sausage-using Consumer Positioning Concept Voting

STEP FOUR 22

Based on qualitative research Family connection closest to target customers core

Would be easier to provide tactical support for the Clever Cooking positioning

Quantitative testing settled the differences

STEP FOUR 23

Italian Sausage Concept Assessment

STEP FOUR 24

‘Family connection’ scored better than ‘clever thinking’ maybe because

Familiarity with existing brands

Authentic Italian heritage

Positioning inherently more motivating

But was the “Clever Cooking” idea more distinctive and durable?

STEP FOUR 25

The group discussed how advertising look and feel, packaging, product attribute, name, considering sub-branding

Picked the winner from the two final concepts.

SWOT ANALYSIS26

• 29 local competitors• Risk of cannibalization with

bratwurst• Change of distribution network

• Growing markets• No national competiton• Exploit saxonville’s brand

• German company, Italian brand

• Advertising campaign• Unclear positioning

• National Distribution Network

• Strong Brand Recognition

Strength Weakness

Threats Opportunities

3 C’S 27

Company

CustomerCompetitor

Sausage companyGerman company located in U.S.

Family, restaurants and fast food jointsBarbeques, grillingNational products

National and local competitors, declining sales of 2 productsOpportunity in one product

4 P’S28

Product

Place

Promotion

Price

• Homogeneous and consumer class product

• Vivio already known by people

• Fresh ingredients are highly visible

• Distribution channel already in place due to other national products

• National market availability

• Sell at a premium (indicates quality)

• Not to over price- local competition and their positioning

• Advertising (websites, newspaper, magazines etc.)

• Publicity on festivals, public events, special occasions

• Careful target audience• Complements, coupons,

discounts• Strong Italian image to

promote heritage

MATCHING TARGET WITH VALUES 29

Seg

men

tati

on

• Geographic• Demographic• Psychographic• Behavioural Ta

rget • Families

• Middle aged females

• Outing people Valu

e • Creativity

• Easy availability and quick processibility

• Valuable time with family

• Good nutrition value

CONCLUSION ? 30

CONCLUSION 31

Family Connection is most strong position and is suitably addresses the whole family because the females manages the kitchen and binds the family during family meals

Brand vivio is already well known by people locally and can help it to popular nationally

Changing names may create confusion for loyal customers

‘It welcomes you in’ can also bring it to use in parties and other get together once it is known for bringing people together.

CREDITS 32

All Photos are taken from google images

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THANK YOU

DISCLAIMER

Created by Shivam Verma, IIT Delhi, during an internship with Prof. Sameer Mathur,

IIM Lucknow,www.IIMInternship.com ”

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