Fresh Whole Grain Pizza
TO LAUNCH or NOT TO LAUNCH?
TruEarth, maker of gourmet pastas, sauces and meal faced the moment of TRUTH. Identifying the market trend, customers’ needs and wants via extensive market research and recognizing the plan to launch new product line of fresh whole grain pizza by Rigazzi, one of its direct competitors, TruEarth is at the point of making a critical business decision. “TO LAUNCH or NOT TO LAUNCH?” That is the question.
1.Consumer Views On Pizza
Despite some differences between different product categories, namely takeout, refrigerated and TruEarth pizzas, consumers generally consider pizza as a family treat which they can conveniently access and easily prepare. However, in terms of convenience, takeout pizza scored the highest due to its competitive advantage in terms of accessibility and preparedness. As for the taste, consumers rated takeout pizza the highest both in its freshness and variety of choices. As for the quality attributes, both takeout and TruEarth pizza scored high for the quality of ingredients, while TruEarth pizza marked the highest for healthy ingredients, which might have resulted from the 'healthy’ brand image of TruEarth, as well as the brand's core value to use 'top-of-the quality' and 'healthy- conscious' ingredients. The data also shows that 17 % of consumers are willing to change their purchase behaviour when TruEarth pizza is launched, however, restaurants and home-made pizza consumers are less likely to switch to TruEarth Pizza. In conclusion, if TruEarth were to launch pizza, it has to improve its accessibility, user-friendliness (easy-to-prepare), freshness while maintaining price competitiveness against its more-direct competitors, namely take-out or delivered, refrigerated and frozen pizzas in order to win consumers’ heart and mind as well as to sustain its competitive advantage. 2.Consumer Concept Comparison Between Pizza and Pasta
The first difference that can be clearly identified is the percentage of the favourable opinions of the pizza and pasta concepts. While 76% of the survey participants favoured the TruEarth’s pasta concept, only 60% favoured its pizza concept, suggesting less attractive market entry opportunity for pizza. In addition, the whole grain feature of the TruEarth’s products, which is its proposed customer value, is by far less favoured in the pizza concept test, suggesting ‘healthier concept’ in terms of ingredients is less likely to be the trigger amongst the pizza consumers. The TruEarth brand name is also less favoured and the price competitiveness dropped by half in the pizza concept test, suggesting there are well-recognized direct/indirect competitors in the consumer pizza market both for quality and value for money. The price sensitivity of the consumer pizza market is re-emphasized in the ‘DISLIKE’ attribute. The total percentage of participants perceiving TruEarth pizza being ‘too expensive’ more than tripled compared to that of the pasta’s and even those who favoured the product felt TruEarth pizzas are highly priced. This implies that pizza consumers are very much accustomed to value-for-money proposition than quality. In conclusion, the pizza concept test results indicate a higher price sensitivity and more intense competitive environment for pizza in sharp comparison with pasta, which illustrates less favourable market situation for TruEarth. 3.First-mover Advantage In The Pizza Market
When TruEarth launched its whole grain fresh pasta products, there was an undiscovered market leadership opportunity mainly driven by or due to the change of the consumer trend. The increase in disposable income coupled with ‘time poverty’ of the target consumers brought about a need for a new concept of home meal replacement. The fresh whole grain product category was still new and growing. At the same time, its competitors have not yet figured out how to make whole grain pasta that still...