Pasta
Purchased Lambert’s Pasta & Cheese
Challenge – Needed to find a brand name; Discovered Contadina through focus groups and settled on Contadina Fresh. Performed BASES I study to evaluate the current level of awareness and usage of fresh pasta and sauces. NRFC aimed to estimate trial volume for the first year, simulate total year 1 sales volume, and comprehend potential impacts of different positioning strategies. The BASES study predicted market data including trial rate, repeat purchase, transaction size, and purchase frequency. Conducted concept studies to determine optimal positioning.
Completed 300 concept tests in six different cities, targeting 18+ females who were the primary grocery shopper. The research revealed that Superior positioning among Homemade and Pasta Dinner options was the most favorable. Using the BASES model, key forecast data was predicted. The top-two box score, as shown in exhibit 4, reached 75%, resulting in an adjusted trial rate of 34.5%.
Promotion strategy
Spent $13MM in advertising, estimated to generate 48% awareness
Spent $6.2MM in consumer promotion and $4.8MM in trade promotion
Promotions expected to result in 70% ACV (representing 70% of sales volume of all food products in the area)
Repeat purchase
In order to forecast repeat purchase, BASES used consumer reaction to the concept and its prior experience with dry pasta, as no product existed. Three scenarios of product quality (mediocre, average, and excellent) were forecasted. The assumption for the purchase cycle was 6 weeks due to the shorter shelf life. Volume was forecasted according to Table A.
An analysis similar to pasta was carried out on pasta sauce, with the market size being two-thirds of that of pasta. The positioning analysis and segmentation summary (PASS) technique was used to determine positioning. To understand the criteria influencing recognition, preference, and fit of brands, 27 attribute statements were utilized by consumers. The process also included considering manufacturing and distribution aspects.
NRFC decided to address the issue of inadequate manufacturing facilities and distribution channels for refrigerated foods. They made the decision to build a single factory in Danville, Virginia with the ability to produce 60 million units. Alongside, a streamlined distribution system was developed, ensuring the product could be delivered within a span of 10 days.
PIZZA
Pizza is a natural extension of the pasta product line that has been successfully introduced to the market.
The pizza industry is valued at $18.4 billion and is primarily dominated by restaurants, which account for 68% of dine-in and takeout sales. Northern and eastern regions of the United States have the highest pizza consumption rates. Nestle’s research reveals that 75% of pizzas consumed at home are ordered for delivery or takeout. Key national franchisors like Pizza Hut and Dominos control most of the delivered/takeout market. On average, a 12-inch pizza costs between $8 and $10 whereas frozen pizzas have various players with an average size ranging from 6 to 8 inches, sold at prices ranging from $2 to $3.
Product concepts: Pizza kit that is refrigerated and consists of a crust packaged together with separate packets of cheese and sauce (tomato or pesto). The expected price for a 12″ pizza kit is approximately $6.40. Additional toppings are available to be sold separately for $1.30 per topping. There is also a pre-assembled heat and eat pizza option available in four varieties, with the expected price for a 12″ pizza kit being approximately $7.60.
Concept testing is different from the BASES study as it does not project potential product volume. Instead, it aims to assess market interest in new offerings and obtain feedback for concept refinement. The company conducted 400 mall concept interviews in four cities (NY, Atlanta, Chicago, LA). For each concept, 200 people (equal number of males and females) were interviewed. The respondents were either the primary grocery shopper for the household or had a major input in pizza purchase. The top-two box score for the pizza kit was 58% overall (49% for males and 66% for females). For the pre-assembled concept, the top-two box score was 52% overall (50% for males and 54% for females).
The production feasibility of the pre-assembled pizza concept was determined to be infeasible due to quality issues. However, it was found that the pizza kit was feasible to produce using a robotics pizza line, which could ensure uniformity and a high volume of production. Furthermore, national distribution was also feasible.
Market Study
Concept tests of Pizza and Toppings and Pizza only
Objective was to analyze the pros and cons of the two concepts (esp, the effect of availability of separately sold toppings)
BASES II Line extension study involving both a concept and in-home product test
Conduct mall concept interviews in seven cities
399 women over the age of [age] were interviewed as principal grocery shoppers. The interviews included questions about pizza kits and toppings, with 81 of these women being Contadina pasta users. Additionally, 198 women (including 43 Contadina pasta users) participated in interviews specifically focused on the concept of pizza kits. A quota sample was taken for Contadina pasta users, with 100 participating in the study on pizza kit and toppings, and 35 participating in the study on pizza kit only concept.
Respondents likely to purchase the product were given the opportunity to try it at home. After a period of 7-10 days using it at home, feedback was requested regarding their experience with the product.
The pricing for both options was determined based on the results of this study: $6.39 for the pizza kit and toppings option, and $6.39 for the pizza kit only option.
Further research was conducted to assess the penetration rate of the parent brand. Initial findings indicated a penetration rate of 25%.
Based on MRD experience, the penetration of Pizza toppings was forecasted to range from 5-25% according to BASES research.
50% of consumers would buy toppings at every pizza kit purchase, while 25% would purchase toppings half the time.
If toppings were purchased, the trial unit would be 1.5 and the repeat unit would be 1.0.
Promotion strategy
Market support totaling $18MM was estimated to lead to 37% overall awareness (60% for Contadina Pasta users, 30% for non-users). The breakdown of the market support includes $9MM in advertising, $5MM in consumer promotion, and $4MM in trade promotion.
Q3
Where will the sales come from?
For both concepts, based on forecast for volume, Contadina pasta users will account about 3 times as much sales compared to Nonusers. Exhibit 24 for competitive options
Yes, because of brand penetration of upto 25% will help trigger trial higher sales volume. Revenue =( Trial volume + Repeat volume)*6.39
Pizza & Topping
Pizza only
