Nestlé Refrigerated Foods: Contadina Pasta & Pizza

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Marketing Management | Nestlé refrigerated foods: Contadina pasta & pizza | Case analysis | Ahmed MAJT18/11/2010 | Executive Summary 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…
This can have impact on other brand products, mainly Contadina pasta that will be associated to weak products. Second alternative is to not launch, because the risk is very big and we are not sure about the parent brand penetration rate. If product launch failed because product is badly perceived, Neslté will run the risk of damaging its established pasta brand. If the market is viable, Kraft that has started marketing tests before Nestlé should enter the market with pizza product and not a pasta product. If NRFC choose this option, it will lose an opportunity of $16.2 billion market. Third alternative is to stand by, because the risk of non profitability is too high and because the perceived price and quality value does not give the product the best positioning. Nestlé should wait until doing deep test market to be sure about parent brand penetration rate and resolve price/value and positioning problem by trying to reduce product price. If this option is chosen, Nestlé will lose the first mover advantage, pre-empted by competitors and probably will never get the deserved market share. The third alternative seems to be the best option to consider. Concept tests data are not accurate due to the size of the sample and the region where the test has been conducted (more favorable to pizza). If penetration goes below 15%, product profitability may be in danger. Changing product price or investing more in

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