Nestle Contadina Pasta Case Study

Previously, Nestle entered the refrigerated food market with Contadina Pasta and Sauces, which was very successful due to the market research performed. The company invested heavily in distribution to develop products with low spoilage rates. Moreover, Nestle maintained a long-term focus and made strategic investments to ensure its position as one of the world’s premier food companies. As a result, they became the market leader in refrigerated pasta and sauces but realized they needed other new product opportunities as they recognized rapid growth would taper off as new competitors entered the niche market.

Nestlé had been committed to research and development for its new products, quality improvements, manufacturing advances, and, most important, adaptation of products to meet the specific taste of varied cultures and market. In 1990, Nestle contemplated the introduction of a refrigerated pizza product to US market. Before making a decision, the company needed to look at the numbers to ensure business viability. The company had a profitability goal of three years and a focus on marketing while addressing issues of manufacturing, distribution, and sales. At the same time, Nestle had the looming expectation that Kraft would launch a pizza product within six months.

Alternatives

1. Launch Pizza with Toppings
By launching
As it was indicated that high quality ingredients were traits consumers valued in a product, these aspects should be factored into the final product. By launching within six months, Nestle would be able to build brand and product loyalty in the refrigerated foods market before other competitors such as Kraft enter the market. As the new pizza product will have strong parent and umbrella brand support, it will be more easily accepted into the market. Nestle should keep in mind that the success from pasta and sauces may not be exactly duplicated in the pizza