I Roscilli Frozen Mushrooms and

TrufflesBradford HoskingMolly HolcombePayton Renner

Alec Gryski

Mission and Goals

• Mission• “Provide transparency, quality, and innovation

to a high product turnover”• Seeks to reach consumers with a strong

appreciation of unique food products

• Goals• Expand business to global market – USA• Introduce new branding method “gli ExPorcini”

Core Competencies

• I Roscilli intends to use core competencies:• to establish themselves in the American

market• to gain a competitive edge

• Core Competencies1. Offers highest quality mushrooms on the

market• 48% of Italy’s market

2. Innovative packaging technique3. Produces multiple product packages from

high quality fungi and vegetables to frozen fruit varieties

The Problem

• Looking to expand business• Frozen Mushroom market in US is small • Fresh Mushrooms = 85% of market

• Ready-Made meals • Consumer Education

SWOT – American MarketStrengths

- Strongest presence in Italian market

- Good reputation among consumers

- Packaging- Large client-size range- Flexible management

Weaknesses

- “Unsought Product”- Lack of international market

experience- Lack of distribution channel

access- High cost structure- Cultural & Language barrier

Opportunities

- Ability to shape the market - Growing interest in

healthy/organic market- Don’t have to sway Americans

from a preferred brand

Threats

- One-Step meals/lack of detail cooking

- Mondelli Group is relatively unknown

- Chinese importers can be cheaper

- Not American-made

Market Summary - Global

• Global mushroom market has shown growth in recent years, driven by:• Increasing development of high yield systems• Rising saturation in demand• Consumer shift toward value-added products• Increased demand for organic products• Health awareness

Market Summary - USA• Majority of processed mushroom imports = Chinese• Majority of fresh mushroom imports = Canada• Larger market for Fresh Mushrooms over

Frozen/Preserved• America grows its mushrooms mostly in

Pennsylvania • Over 40%

• Majority of mushrooms are imported from other countries

Target Market

• High-end grocery stores• Upper middle class customers

• American food service industry• After gaining a strong hold on retail

MRisks

- Market transformation costs- Advertising/marketing costs- Foreign exchange rates- Risks involved with diverse workforce- Health risks- Stigma and education of consumer

Limitations- Lack of experience in US market- Complex transportation- Environmental constraints- Prices- Wage rates and labor availability- Food preference of U.S. Customers- Support of the industry through the USDA

(minimal)

Market Forecast

• Mushroom popularity is increasing • High nutritional values – Healthy/low fat• Substitute of meat

• Increasing shelf life• Expected to grow at a CAGR of 9.5%

between 2014-2019

Competition in the USA• Store Brand Products• Publix, Kroger, Trader Joes, etc.

• Fresh & Easy• Nestle (Buitoni frozen food brand)• Monterey• Phillips Mushroom Farms, Inc.• Giorgio Fresh Mushrooms• Pennsylvania Dutchman

Competition in the USA

• Modern Mushroom Farms, Inc. • Moonlight Mushrooms• Fungus Amongus• Dole• Gourmet Mushrooms Inc.

American Examples

Competitors in China

• Dalian Xinming Food Co. Ltd.• Tianjin Kunyu International Co., Ltd.• Qingdao Sinonut International Ltd.• Greentasty Foodstuffs International Co., Ltd.

Alternatives

Decision and Decision Justification

• The Opportunity• Alternative Option #2• “Discover” feature of grocery shopping• Small existing market – easily penetrable • Endorsements and Partners• Familiarity• American-made products/Celebrities

Decision and Decision Justification

• Retail• Educate consumer on freshness of packaging• Emphasize “specialty food” aspect• Success in European market

• Advertising and promotion

Possible Retail Clients

• Whole Foods• Kroger• Sprouts Farmer’s Market• Publix• Costco

Assumptions 1. I Roscilli has the existing capital and/or the ability to come up

with the capital to make the move to the US.2. I Roscilli does not have a strong existing presence in the

American market.3. The way that I Roscilli goes about obtaining the mushrooms,

packaging, and transportation is the most cost-efficient.4. We assume that although I Roscilli has made some entrance

into the US market they are still in need of an efficient and cost-effective strategy to distribute from the Italian headquarters to the desired ports and clients.

5. The mushrooms sold by I Roscilli are Porcini and Champignon; limited knowledge of specific varieties of mushrooms.

Implementation

Year 1 – Introduction Stage: Product

• Product• Offer products aimed toward family-sized

consumption• “I Roscilli” and “Le Valle dei Funghi” lines• Test markets

Year 1 – Introduction Stage: Packaging

• Packaging• Keep innovative design – Frost-less vacuum

seal• Add education• Recipes • Preparation instructions• Endorsements

Year 1 – Introduction Stage: Price

• Price• Price point lower than future goal• Gain popularity

• Trend• Prices escalate in winter • Competitive pricing• Biggest rivals: Monterey Mushrooms, Phillips

Mushrooms, and Store Brands ($1.99-2.99)• Find a comfortable starting range

Year 1 – Introduction Stage: Place

• Place• Outsource distribution capability to

International distributor• Possible client: DHL – global market leader in

distribution • Be aware of US Customs Import General

Requirements

Year 1 – Introduction Stage: Promotion

• Promotion• Cost will be at its highest• Increase customer awareness and education• Play the company’s strengths

• Celebrity Endorsements• Chef Giada De Laurentiis• Chefs from Extra Virgin

• Debi Mazar and her Italian husband, Gabriele Corcos• Chef from Dolce Vita

• David Rocco

• Television Commercial Costs• Local stations: $200-$1,500 for 30 seconds• National Stations: produced by agency for 30 seconds; $100,000-$350,000

• Preferred: Food Network, The Today Show, Good Morning America, Cooking Channel• Timeslot for when target market is most likely watching

Year 1 – Introduction Stage: Promotion

• Trade shows• Average cost (per square foot) = $22.32• Exhibit space = 28%• Exhibit Design = 12%• Show Services = 19%• Shipping = 9%• Travel & Entertainment = 21%• Promotion = 6%• Other = 5%

• The bigger the exhibit, the more memorable

Year 1 – Introduction Stage: Promotion

• Online Advertising • The larger the size, the larger the price• Where the ad is located on the page will affect the price• Unit CPM rates:• 728 X 90= $14.88• 300 X 250= $16.12• 160 X 600= $15.25

• CPM Rates = Total site revenue/total site page views x 1,000

• CPC (cost per click)• Highly trafficked sites

Year 1 – Introduction Stage: Promotion

• Billboard Advertising (common roads)• Typically 14 X 48 feet for 4 weeks• 1. Albuquerque, New Mexico (adult population

680,000)• $1,200 per billboard for 7 billboards

• 2. Atlanta, Georgia (adult population 4,762,000)• $2,500 per billboard for 28 billboards

• 3. Ann Arbor, Michigan (adult population 268,000)• $1,500 per billboard for 3 billboards

• Printing the advertisement itself (normally about 700 square feet) is about $500

Year 1 – Introduction Stage: Promotion

• Grocery Store Marketing• Sample taste tests in stores • Recipe collaborations with other brands

• Social media awareness• Enhance “fun”

• Include coupons • Preferably digital • 75.3% of shoppers redeem coupons on their phone

(2013)

Year 5 – Growth Stage: Product

• I Roscilli should have a better idea of what American consumers find appealing

• Adjust products accordingly • Joint ventures

• Complementary goods and services • Barilla --- The US and Italy

• Authentic staple food• Large range of customers

• Buitoni --- US and Italy • Authenticity and good reputation/reviews• Large range of customers

• Joint Ventures cont.• Store Brands

• Have specials combining the brand and Roscilli product• Target grocery stores already selling the product

Year 5 – Growth Stage: Packaging

• Continue with unique innovation• Improve as technology evolves• Presentation to customers• Constant quality

Year 5 – Growth Stage: Place and Promotion

• Place• Assuming functionality, continue partnership

with DHL

• Promotion• Allocate less on education – more on

advertisement • Allow for Word of Mouth

Year 10 – Maturity Stage

• Use knowledge gained and innovation capabilities to: • Continue increasing presence and market

share in the US Frozen Mushroom and Truffle Market

• Properly place the right products, to the right place, at the right price in the US market

Outcome

• I Roscilli has the ability to create a better market for the frozen mushroom industry

• Education – main beginning component • Difference between frozen and fresh

mushrooms

• Competitiveness of market may increase

Questions/Comments

Year 10 – Maturity Stage: Product and Packaging

• Product and Packaging• Should be comfortable meeting the American

consumer’s needs• Flexibility• Trends

Year 10 – Maturity Stage: Pricing

• Raise the price slightly to make up for any expense

• Better market share and reputation• Be aware of cannibalization of new products

Year 10 – Maturity Stage: Place and Promotion

• Place• Strong partnership with distributor • Have most efficient means of transportation • See some discounts when it comes to larger

rates and quantity of shipments

• Promotion• Increase spending on creating new products