A.1 Steak Sauce Defense

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Situation Analysis

Customers: Our customers are those who like to cook or grill meat outside.

Competitors: Our primary competitor is Heinz 57. They have a market share of 16%. The secondary competitors of our business are private labels. They have a market share of 14%. The rest of the competitors towards our company make up the 16% of the market share. A new rising competitor is Lawry’s with new product, steak sauce.

Collaborators: Our collaborators consist of virtually every grocery store, merchandiser, and club store. They all carry our product which is mostly located in the condiment isle.

Company: A.1 steak sauce started in England in the 1830s by Henderson William Brand, the chef King George. He was so delighted with the sauce that he proclaimed it to be A.1. Since, then, A.1 made its way to the United States in the early 1900s and has been the most dominant in its category with a market share of 54%. Afterwards, in 2000, Kraft foods purchased A.1. and is now under the umbrella of the second largest brand in the world and the largest in the United States.

Context:

SWOT Analysis

Strengths our company has:
54% of the market share
High brand equity
Natural ingredients
No major competitors
High loyalty

Weaknesses our company has:
Price is higher than competitors
No successful product extension

Opportunities our company has:
Usage of coupons
Advertising
New packaging
More research for product extension

Threats our company has:
Duplication of our sauce by competitors
Increase in private labels
Losing shelf space

Problem Statement

The problem that our company has longed lived for is limited competition. We have been dominating the market with our product for a number of years. Now, our new competitor Lawry’s, is coming out with a new product which is the same type steak sauce we sell and aggressively and is targeting the same retailers as us with their marketing campaign. Their prices are offered lower than ours and the company is stealing our promotion spots from retailers during the Memorial holiday. Lawry is directly competing against us and are trying to steal our sales and market shares. Our primary goal will be to maintain our market share of 54% against our new competitor throughout the year (12 months). The way we are going to measure this is by analyzing our sales each month then dividing them with the total sales of steak sauce to see where we are at in the market share. By doing so, it should help understand where we stand in the total market share towards for our company.

Relevant Criteria:
Does the suggested strategy help maintain the market share? •Does the suggested strategy help lock-in retailers?
Does the suggested strategy create excitement with customers? •Does the suggested strategy create higher awareness with customers?

Description of Alternatives:
Create a special branded coupons
Create a contest/prize for customers
Spend more money on shelf space and trade promotion
Create a campaign about how our product has all natural ingredients •Create a donation to the Breast Cancer foundation

Analysis of Alternatives:

Special Branded Coupons: The first suggested strategy will be coupons. During the two holidays, Memorial Day and 4th of July, we will run coupons. We can team up other products to go with ours by using a complimentary item. From research, we found out that besides meat being purchased with our product, there is also a large amount of cheese being purchased. Since we are a part of Kraft Foods industry, we can run a special branded coupon with the Kraft cheese.

The positives outcome with this strategy is that this would be a great way to defend ourselves against Lawry’s. The reason is that they may have lower prices for more quantity, but by having a coupon to go with a complimentary item should retain our market share. This would also contribute to our market share. It would...
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