Nestlé Refrigerated Foods: Contadina Pasta & Pizza
Ahmed MAJT18/11/2010 |
In a growing ethnic food category, NRFC is facing the decision of launching or not Contadina fresh pizza. Study has shown that business viability is closely depending on brand penetration rate which is not accurately measured. Moreover, NRFC try to get the first mover advantage to face the expected concurrence of Kraft. Product is facing positioning problem, and if the launch failed, it may affect brand awareness and be harmful to its pasta line. NRFC should resolve positioning problem by finding the right price that increase sales reduce dependency to brand parent and ensure product …show more content…
BASE model gives pizza and topping and pizza only volume estimation for the targeted 95.5 million households (exhibit 1), 11.53 million pizza units and 9.84 millions topping units are needed in case of pizza and topping option and 8.25 million units are needed in case of pizza only option. Exhibit 2 shows also that the only viable option is pizza and topping.
Based on sensitivity analysis in exhibit 3, the success of launching Contadina pizza and topping depends on parent brand pasta penetration rate that MRD has mentioned that can range from 5% to 25%. To meet business requirement, the penetration rate should be at least at 15%. With such inputs, NRFC has tree alternatives that should be taken in consideration. First alternative is to lunch pizza and topping, because research has shown that the projected penetration of 24%, is much higher than the minimum required (15%). The required market share is only .3% of a huge pizza market. Besides, the direct competitor, Kraft is expected