Branding and marketing New Zealand food products a
Branding and marketing New Zealand food products: a case study approach Suzanne Trafford, Lincoln University, New Zealand Suzanne. Trafford@lincoln. ac. nz 20 th April 2017
Thank you for being here • Sue Trafford – Lecturer in Agribusiness Markets, Faculty of Agribusiness & Commerce, Lincoln University • Academic and business interest in the drivers of agribusiness success and in agribusiness risk management • Partner in an incipient & innovative Canterbury agribusiness • Today: ü Importance of branding in achieving agribusiness success – Zespri ü CCSD case study
Case study methodology as a teaching/ learning tool • LU uses them • Immerses students into realistic business situations • Cases provide the reality of managerial decision making — which includes incomplete information, time constraints, and conflicting goals — as students learn how to analyse business situations • Branding and marketing of agribusinesses • Zespri’s branding strategy case study • CCSD – a case study exercise 10/03/2021 Sue Trafford, Lincoln University 3
What is New Zealand’s most trusted and iconic brand? http: //www. stuff. co. nz/business/industries/84170885/whittakers-holds-mostlovedbrand-top-spot 10/03/2021 Sue Trafford, Lincoln University 4
A brand – what exactly is it? “A brand is the perception someone holds in their head about you, a product, a service, an organization, a cause, or an idea. Brand building is the deliberate and skillful (sic) application of effort to create a desired perception in someone else’s mind. ” “To build a great brand, you need the right blueprint for shaping those perceptions. Fortunately, the best blueprint begins with just three components: what, how and feeling”. Mc. Laughlin, J. (2011, December 14 th). A Simple Blueprint for a Successful Brand. Retrieved from https: //www. forbes. com/sites/jerrymclaughlin/2011/12/14/a-simpleblueprint-for-a-successful-brand/#6 e 5 c 08095484 10/03/2021 Sue Trafford, Lincoln University 5
Branding & markets – the relationship • The marketing practice of creating a name, symbol or design that identifies and differentiates a product from other products • The purpose of a brand is to increase sales by making the product or service the most visible and desired by the consumer. • Separates competitors and helps consumers remember a product • An effective brand strategy gives you a major edge in increasingly competitive markets • Branding is becoming more than a logo or a product. It is becoming a promise of …. quality and reputation 10/03/2021 Sue Trafford, Lincoln University 6
Brand attributes = core values/ sets of characteristics = essence of the brand. " A passion for chocolate since 1896" and "Good honest chocolate". 10/03/2021 Sue Trafford, Lincoln University 7
• Branding = process of forming memories, emotions and a relationship around your brand in the consumer’s brain. • Need to build such a strong connection and such strong belief that the consumer take on your brand identity as their own. • http: //www. babydollwines. co. nz/sites/all/themes/babydoll/images/h ome-hero. jpg People use your brand to help define who they are as a person/ and who they are not? 10/03/2021 Sue Trafford, Lincoln University 8
Winners and losers… • Brand not only creates loyal customers, but creates loyal employees. Brand gives them something to believe in, something to stand behind - helps them understand the purpose of the business. • Brand = strategy • Marketing = tactical (what you use to get your brand in front of consumers). Mc. Neilly, H. (2017, February 17 th). Thttp: //www. stuff. co. nz/business/industries/89522567/hero-to-zero--cadburystake-large-bite-out-of-brand 10/03/2021 Sue Trafford, Lincoln University 9
Profile of a successful agribusiness brand ZESPRI International Limited • • = world’s largest marketer of kiwifruit 100% owned by past and present NZ growers Sells into 53+ countries Manages 30% of global volume. In 2015/16 Zespri sold 131 million trays Unique industry structure with customer & consumer focus Business model underpinned by quality, brand innovation Retrieved from http: //www. zespri. com/companyinformation 10/03/2021 Sue Trafford, Lincoln University 10
Zespri Strategy = To develop and market the world’s leading portfolio of kiwifruit products for 12 months of the year Sustainable Competitive Advantage Brand & Marketing Quality In-market Distribution Integrated Supply System Category Mgmt Leaders in Innovation Leading Portfolio of Kiwifruit Products Single Point of Entry 10/03/2021 Sue Trafford, Lincoln University Quality. Brand. Innovation. Gould, M. (2014). Lets Talk about Zespri. 11
How does ZESPRI achieve this? “Consists of awareness, recognition, and top of the mind awareness of the product amongst consumers; positive brand associations; perceived quality and brand loyalty. Brand equity will result in price premiums, consumer and trade loyalty, trade cooperation and joint marketing efforts and pride of ownership among the company”. (Aaker and Joachimsthaler, 2000 cited in Beverland, 2001: 383). Brand equity refers to a value premium that a company generates from a product with a recognisable name, when compared to a generic equivalent. Companies can create brand equity for their products by making them memorable, easily recognizable, and superior in quality and reliability. 10/03/2021 Sue Trafford, Lincoln University 12
ZESPRI’s Objectives To grow Zespri’s share of the fruit bowl category, and make it the kiwifruit brand of first choice through increased frequency of consumption, in targeted markets Category penetration: • To increase the proportion of fruit eaters, who also eat kiwifruit Consumption frequency: • To increase the number of ‘raving fans’ – regular consumers who eat at least weekly Brand recognition: • To build brand engagement: brand recognition, brand trial, repeat purchase intent, perceived superior offering 10/03/2021 Sue Trafford, Lincoln University 13 Gould, M. (2014). Lets Talk about Zespri.
By building brand equity • Non negotiable, preferred choice • Create habitual purchase patterns, regular / weekly purchase • Target health aware • Education on the Zespri difference > quality, taste, health • Global strategy, local execution 10/03/2021 Sue Trafford, Lincoln University 14
Global Consumer decision making factors What consumers say is important when considering consuming kiwifruit: Factor Analysis. The decisionmaking factors that are highly correlated / connected together. 10/03/2021 Sue Trafford, Lincoln University 15
What does success look like? • Targeted markets: • Growing from 13 to 25 key markets in 5 years • High share: • Move from <0. 5% of fruit bowl globally • In key markets, 5 -7% of fruit sales • One of top ten fruits • High value: • Zespri kiwifruit at a price premium • Perceived value: taste, quality, brand, health, convenience • Brand leadership: • Perceived superior quality; brand preference • One of top five fruit brands. 10/03/2021 Sue Trafford, Lincoln University 16
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Big brand-based expenditure • Goal = double sales to $4. 5 billion a year by 2025 • Spending $40 million on brand marketing • ¼ of annual marketing budget, in China - expected to become its number one market by volume in 2017 http: //www. stuff. co. nz/business/industries/81961442/Inside-Zespris-plans-to-grow. Kiwi-kiwifruit-in-China 10/03/2021 Sue Trafford, Lincoln University 18
Brand awareness compared to other fruit brands in international markets $150 million worth of kiwifruit to China 2016 9 15% of global sales 10/03/2021 Sue Trafford, Lincoln University 19
Kiwifruit attracting premium prices in Carrefour supermarket in Kunming, Yunnan, China – December 2016 Zespri sales into China grew by 50% in 2016 & expected to grow by 40% in 2017 10/03/2021 Sue Trafford, Lincoln University 20
“The kiwifruit industry made a choice back in 1997 to create a brand which would differentiate NZ fruit on the world stage. As an industry, we had a choice – to become a low-cost perishable commodity, like most other fruits, or to market a superior branded product. But a brand on its own is just a picture and letters. The success of the Zespri brand is built on the relentless quality systems which ensure the fruit is delicious and top quality, and the passion and dedication of tens of thousands of people across New Zealand around the world over decades. ” Lain Jager, Zespri CEO (2017). Happy 20 th birthday Zespri! (2017, March 3 rd. Retrieved from http: //www. ruralnewsgroup. co. nz/item/11561 -happy-20 th-birthday-zespri 10/03/2021 Sue Trafford, Lincoln University 21
Case study: Charing Cross Sheep Dairy – 10/03/2021 Sue Trafford, Lincoln University 22
• MPI dairy export compliance – December 2016 • Processing factory underway 2017 ü 2017: Milk, Yogurt based drinks ü 2018: Ice cream for domestic market ü 2019 Ice cream for export 10/03/2021 Sue Trafford, Lincoln University http: //www. stuff. co. nz/business/farming/sheep/664325 23 73/sheep-milk-promises-smooth-icecream
Analyse the case study (20 minutes) • In groups – read the handout and write down the answers to three key questions: • Discussion 10/03/2021 Sue Trafford, Lincoln University 24
10/03/2021 Sue Trafford, Lincoln University Questions? Thank you for attending 25
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