Since 2004, the overall market demand for sausage products has been flat in both the bratwurst and breakfast sausage categories, while the only market segment showing significant growth was the Italian sausage category (overall market growth of 9% in 2004 and 15% in 2005).
Saxonville’s Italian line, Vivio, was keeping pace with the growth of the category, but was distributed in just 16% of large supermarkets, principally in the Northeast and mid-Atlantic states. In contrast, the Company’s bratwurst and breakfast products were generally distributed and sold nationwide, however, with little distribution in the Northeast markets.
To capitalize on the market opportunity and growing demand for Italian sausage, the Company’s new product marketing director, Ann Banks, was tasked to develop and implement a plan to properly position and launch a national Italian sausage brand. Saxonville’s goals were to become a national leader in the Italian sausage segment, take advantage of the growth in that category, avoid or minimize cannibalization of its other product lines, and achieve its profit objectives for the next year and beyond. II.
PROBLEM DEFINITION The Company faced two key issues: (i) how to optimally position its Italian sausage brand for national success; and (ii) which distinctive brand identity (e. g. “Vivio” vs. something else) would resonate most with the principal purchasers of Italian sausage to influence them to desire and buy the Company’s product. III. ANALYSIS OF ALTERNATIVES In order to create this optimal brand positioning, Banks and her team found it necessary to conduct market research to, first, identify the primary uyers of Italian sausage and, then, to understand the needs and values that motivate them to purchase Italian sausage. Analysis of secondary data, including results from the Company’s prior data on Attitudes and Usage (“A&U”), its regularly updated online market database, and previous year-end reports and annual branch business plans, revealed that female head-of-households were the primary purchasers of Italian sausage. The data also detailed usage patterns, demographic differences and other characteristics.
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Analysis of primary data, first, from exploratory pilot groups, helped the team understand what users have to say about Italian sausage and to validate findings from the A&U data. Then, focus groups comprised of the primary target market – female head-of-households – provided insight on users’ needs, purchase triggers, perceptions of product benefits (emotional and functional) and other attributes. With these findings, Banks’ team developed common themes and brand positioning concepts.
The team narrowed the positioning concepts to these four: (i) “Family Connection”; (ii) “Labor of Love”; (iii) “Balancing Act”; and (iv) “Clever Cooking. ” Each concept was designed to link an emotional benefit to a functional benefit to satisfy the target users’ core value of wanting to do a “job well done” for her family and herself (Appendix A).
Additional qualitative research to prioritize the positioning concepts resulted in the top two themes, “Family Connection” and “Clever Cooking. While “Family Connection” scored better in the final phase of testing, both concepts were extremely viable, with each of them receiving the highest purchase intent scores the Company had ever seen. Since the Company operated primarily in the fresh sausage market and already had a reputation for exceptional product quality, it was crucial for Banks and her team to hit a bull’s-eye with the national branding and positioning of its Italian sausage.
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Doing so would enable Saxonville to successfully penetrate national markets in the fastest growing sausage category while maintaining healthy profit margins by offering a premium brand. Although costly, Banks’ extensive use of primary research, particularly through focus groups, was necessary and justified given the critical importance of truly understanding its target users to properly position its product and brand. However, one area that we think Banks should have considered, was conducting focus groups in other key geographic markets in the U. S. as opposed to just the Northeastern focus groups that they held. Doing so would give her team greater assurance that the positioning would resonate in other parts of the country, or alternatively, whether to consider a regional positioning strategy if the results were markedly different based on geography. Nevertheless, assuming the focus group results were representative of the target market, we concur with the top two positioning results (“Family Connection” and “Clever Cooking”), as they clearly reverberated more strongly and far outscored the other two concepts (“Labor of Love” and “Balancing Act”).
The second major challenge concerned the national brand identity for this newly-positioned Italian sausage product. Banks and her team needed to evaluate and decide from among three alternatives: (i) use the existing “Vivio” brand name for the national roll-out; (ii) develop a new brand identity; or (iii) whether to include the Saxonville name to leverage its established brand equity. While the first two alternatives were mutually exclusive, the third option could be paired with either of the first two options (e. g. as a co-branding or sub-branding).
As noted in the case, very little thought, expense or research went into the “Vivio fresh Italian sausage” positioning. The name was created to distance itself from Saxonville’s German heritage, to enhance appeal as an Italian product, and was distributed in the Northeast to introduce bratwurst products to that part of the country. Vivio was not promoted via advertising, was priced comparably to competitors and roughly 20% above store brands, and supported only through base trade spending.
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In spite of focus group research findings that users have a low regard for the Vivio name (placing only 7th out of 20 as the best fit for users’ ideal Italian sausage product), Vivio has steadily been gaining in distribution, which speaks to both the growth of the Italian sausage segment as well as the exceptional quality of the Company’s product. This association with quality, allows Saxonville to command a price premium over its competitors in the bratwurst and breakfast segments.
However, while Italian sausage users associate Saxonville with its moniker, “The Family Company,” in markets where the Company’s bratwurst products are distributed, Italian sausage users felt “Saxonville” was a poor name for an Italian product due to its German association. IV. RECOMMENDATIONS Recommendation #1 – Brand Positioning: “Family Connection” Our feeling is that the “Family Connection” positioning is inherently more motivating for the target market (female heads of household) than “Clever Cooking” and therefore, is our recommended positioning.
While “Clever Cooking” seems to address target users’ intrinsic need for creativity in their otherwise hectic, mundane lives, we feel that ultimately, nothing holds more value or resonates more strongly with the users than their families, and the need to feel like the essential glue keeping their families connected. The “Family Connection” positioning offers greatest emotional and functional benefit to consumers. This choice is supported by focus group testing which found that 54% of first place votes went to “Family Connection. It is important to note that the “Family Connection” positioning may not be as effective nationally if, as mentioned earlier, the focus group and testing results are not accurate for Italian sausage users outside of the Northeast geographic market. To address this management can continue quantitative testing in other regions before offering the new product or evaluating the effectiveness of the campaign in key markets and adjusting as needed.
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Although quantitative cost-benefit analysis data is not available to weigh these two options, for the Company to act quickly on the growth opportunities in the Italian sausage category, we recommend the latter. Recommendation #2 – Brand Identity: “La Famiglia – Fresh Italian Sausage by Saxonville” There are 29 local/regional Italian sausage players, but no national brand. Introducing a properly- positioned Italian Sausage brand could propel Saxonville into a national leadership role in the category.
Although the Company’s Italian sausage was well established in the Northeast, it was in spite of its users’ lack of connection to the “Vivio” name. To complement and reinforce the product’s positioning (“Family Connection”), we recommend rebranding the Italian sausage product as “La Famiglia – Fresh Italian Sausage by Saxonville. ” In order to link it with the Italian heritage and resonate with target users, La Famiglia has been chosen for the rebranding “Fresh” distinguishes the product from frozen, smoked or semi-dried products. Sub-branding it to Saxonville leverages the rand equity built on exceptional quality and further reinforces the brand positioning through its association as “the Family Company. ” The unique positioning and branding together with its quality reputation should enable Saxonville to price at a premium against its competitors. In order to be cognizant of management’s possible objection to removal of the Vivio name or concerns about cannibalizing the Vivio brand, we suggest a transition strategy beginning in the Northeast markets, and offering both brands for a limited period of time (e. . , 6-12 months) until users recognize/embrace (or reject) the new brand and adjust future marketing efforts accordingly. With management’s approval on the new brand identity and positioning, our team is prepared to provide a comprehensive marketing plan to implement them. APPENDIX A – Italian Sausage Potential Positioning Concepts ——————————————– [ 2 ]. Moore, K. (June 15, 2007).
Saxonville Sausage Company. Harvard Business School. Reprint.
