Saxonville Sausage Company Case Study
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[pic 1][pic 2]Saxonville Sausage Company Case StudySaxonville Sausage is a family owned company in Saxonville, Ohio that manufactures and sells fresh pork sausage products. In 2005 they had revenues of $1.5 billion, with their main product being bratwurst. Saxonville also has breakfast sausage and Italian sausage products making up their remaining product lines. The bratwurst offering represents 70% of the revenues of the company, with breakfast sausage at 20%, Italian sausage at 5% and store brand making up the remaining 5%. Sales in bratwursts have been flat and shows no signs of growth in the short term. The breakfast sausage line has been steadily underperforming in the market and has contributed to the decline in revenue. The Italian sausage products have been the only product with increases in the market, and with increases of 15% in 2005, this is an area the company intends to focus on to enhance revenue of the company.For Saxonville to take advantage of the growth in the Italian sausage market, they need to have an honest look at the challenges that face them and make moves to address each and establish a national Italian sausage brand. Vivio, Saxonville’s brand of Italian sausage, struggles with differentiation, segmentation and positioning in its current market, the Northeast. Saying that, there are good reasons to see that a focused approach can capitalize on the strengths that have been established and Vivio can be strengthened to further their efforts in the Italian sausage market enabling a national brand. Current State/ChallengesInitial efforts to launch this product line can best be described as unfocused and cost effective. Management’s attitude and apparent lack of commitment toward this initial launch and marketing in general, is a root cause to many challenges this brand has in front of it, with management even referring to positioning as a business school buzz word. The genesis of the name Vivio is a great indicator to this. It was simply ‘made up’ in an attempt to sound Italian, but getting from sounding Italian to relevant to Italian sausage was not achieved. The name does not further efforts to help with the relevancy of the brand in the Italian sausage market. With other brands utilizing TV, radio, newspapers and store circulars as advertising, Vivio relied on base trade spending. This lack of investment in advertising missed a huge opportunity to distinguish the Vivio brand as relevant and unique to the Italian sausage market so that it could be positioned as a preferred brand. One of the challenges of this brand, is that Vivio was not a first mover in the market. This timing adds to the struggles in terms of differentiating your product when your attempts are as generic as described. Even the packaging did little to make Vivio a unique offering or identifiable with the Italian sausage market. It was presented on a Styrofoam tray with covered plastic wrap with little help in terms of description or labels to make the product even appear unique. The labeling of ‘Vivio fresh Italian sausage’ was the extent to which the packaging assisted with identifying it with the Italian sausage segment of the market.
Although the pricing is in line with the competitors, the pricing tactics was a big influencer on the initial position of this brand in the market. Through the pricing tactics of being on special every other month, it was positioning itself as a cheap product. This pricing tactic is relevant in that it presented a consistent message that you only buy this on special every other month and purchase other brands when it is not on sale. Without a focused attempt to position this product in the market, the product positioned itself as a generic Italian sausage that can always be purchased on sale. Saxonville needs to take steps to address the brand issues in order to establish a national Italian sausage brand that will further the company efforts. To do this, there are considerations that need to be accounted for.ConsiderationsAs we address the differentiation, segmentation and positioning issues described above for this Italian sausage brand, there are certain items that should be taken into account to increase the chances of success for a the launch of a national Italian sausage brand. The first thing to consider is management’s approach and attitude toward marketing. The initial efforts by management indicates their unwillingness to embrace marketing concepts and valuing the benefit of positioning a brand in a simple and consistent way in which it is relevant to the segment the company finds most valuable. The Vivio name should also be a consideration. Market research indicated many names that tested better than Vivio in terms of better segmentation and differentiation. A key component to any brand positioning is a name that furthers both of these concepts and it is important to have a strong supportive brand name.Another key component to moving toward a national Italian sausage brand, is the thought of freshness. Expanding beyond the Northeast to the whole country increases the risk of delivering a fresh product and this should be solved prior to launch. Along with this, is the change in consumer tastes toward naturally health foods. This change in consumer preferences and a move toward freshness are key considerations when launching a national Italian sausage brand. It is also imperative that the timing of our launch be top of mind. The sausage season is October through February, so all efforts to maximize our chances of success should be ready to take advantage of this peak season. Proper timing will help with the large number of local competitors. As an example, in Saxonville’s current market, there are 29 local competitors. Having a clearly positioned and differentiated product will help mitigate this risk presented by local competitors.Lastly, we need to be mindful of positioning our Italian sausage product so that we do not cannibalize our Saxonville sausage bratwursts sales.