FERRY | FRISCA | DWI | GITA Group FGD

Kayem Foods, Inc

Buzz Marketing

Al Fresco Chicken Sausage

Magister Manajemen Universitas Indonesia

Strategic Management

Kayem Foods, Inc., was a medium-sized, privately held, and family-controlled meat processing company located in

Chelsea, Massachusetts for almost 100 years

background

The company sold its products primarily through supermarkets and other retail

food stores, mostly in Northeast.

Kayem’s products were sold under several different brand names

The marketing strategy had been to focus its product offerings on high

quality hot dogs and fresh delicatessen meats.

Product

Brands Detail Product

Kayem Hot dogs, bologna, bratwurst, salami, ham, turkey, roast beer

Genoa Fresh pork sausage, salami

McKenzie Bacon, ham, roast beef

MeisterChef Hot dogs

Schonland Hot dogs, link sausage

Triple M Whole hams, roast beef

AlFreco Gourmet chicken sausage

Co-Pack Product made for other branded processors

Private Label Product made for supermarket private label

Re-Sale Product of other manufacturers, distibuted by Kayem

Al Fresco Key Issue

Product

Positioning

Premium Price

1|

2|

3|

Variety of Kayem’ product | “small but fast-growing”

fully cooked chicken sausage as a convenient, all natural, low carbohydrate, low fat main meal entrée

Al Fresco $4.49 per 12 ounces (at retail), $3.58 per pound (at factory) with $1.60 per pound contribution margin.

Problem Identifications

How to promote the brand on a small buget, but still impacted to target market?

Target Market 1|

a) Demographic : - 25-54 years old woman who was concious of health

and liked gourmet foods and tended to be very interested in foods and food preparation.

b) Geographic The resident in Northeast, Mideast, Southeast, California and Florida

Consumer Behavior 2| Q1: What were the most important factors behind Starbucks’ success?

Residents in South ate the most

sausage, following by those living in

the Northeast

Sausage sales varied seasonally with

approximately one-third of all dinner

sausage sold during the three summer

months.

Breakfast sausage sales peaked during the

holiday season

(Nov – Jan).

People have desire for variety in the menu, and in some cases they serve sausage products that were lower in fat content.

Consumers had used sausage as a staple at all three meals for many years, as a main entrée or as a complement to other center-plate dishes

Those who

purchased sausage, the average

expenditure was $16,95 annually per

family.

3 | Competitors

Company Value per year Media of Advertising

Hillshire Farms $ 29 million Mostly on television

Johnsonville $ 13 million $ 8 million on television

$ 3,5 million on radio

Emerill $ 1 million mostly in magazines

Aidell $200,000 magazine campaign

Marketing Activities 4|

• Special sales promotions

• Low budget ads in magazines

• Low budget TV ads

• Marketing budget for AlFresco in 2004 : $ 90.000

• Buzz Marketing

Buzz Marketing 5|

• WOM Campaign

• Utilizes volunteers (Buzz Agents) to talk about product experiences

• Buzz Agent were not paid, but received points towards different products and could try ‘buzz; products for free.

• Campaign Cost :

$ 47.000

(52.2% of 2004

marketing budget)

Company’Action

Kayem obtained an increased marketing budget of $ 185.000, but only had two weeks to decide the best

option of marketing methods.

SWOT Analysis

1. Already established (almost 100 years of experience).

2. Wide variety of products. 3. Many different brands under the company. 4. Established distribution channel. 5. Expanded growth into other markets and

territories.

1. Unavailable at some supermarkets. 2. Lack of awareness among consumers for

some of its products. 3. Lack of advertising and promotion. 4. Low profit margins. 5. Large amount of money spent on

promotional allowance and discounts with supermarkets.

1. Capitalize on the growth of organic and grain-fed products.

2. Growth of consumer base demanding vegetarian sausage choices.

1. Established competition with larger advertising budgets.

2. Consumer lifestyles shift to healthier living and may not see sausage as a healthy product.

1. Invest in Supermarket Trade Ads.

(Cost : $ 80.000)

OPTION for ALTERNATIVES

PRO(S) CON(S)

• Reach required target market which are supermarket executives and buyers

• Convince decision makers by telling them about the brand’s sales and profit potential.

• It’s costly. The allocation budget may not be enough.

2. Implement another Buzz Marketing.

(Cost : $72,000 to $75,000)

OPTION for ALTERNATIVES

PRO(S) CON(S)

• More credible for creating demand than other media ads.

• Low cost than other traditional methods.

• Lack of support from retail store managers may hinder ability to sustain growth.

• Lack of support from sales executives could ruin sales force moral, feeling as though they are unsupported in their efforts.

• Uncertainty over ethical nature of buzz marketing.

• Potentially to negative publicity.

3. Magazine Ads (Cost : $ 32,000)

OPTION for ALTERNATIVES

PRO(S) CON(S)

• Wide exposure.

• Sustain and built specific demand.

• Influence supermarket executives by creating demand

• Costly for full page ads.

• It’s beyond the brand could support

• Discontinue Buzz Marketing.

Since it’s insulted criticsm in public press about ethic in-appropriate.

• Improve its distribution channel in order to ensure the product’ availability.

• Use the data result from BuzzMarketing as a raw data for implementing CRM.

• Invest in IMC (Integrated Marketing Communication)

Recommendation Picked

•How To Video •Recipes from Chef •Recipes from Customer •Nutrional Info •Coupons •Comment and Review

ThankYou