Page 1: Introduction
Each day, the average consumer makes many decisions and choices about products and brands. When doing so, he or she identifies products in a variety of different ways. A brand comprises a range of features which help to identify the products of a particular organisation. These may include its name, a symbol, term, or other creative element. Branding is important for consumers because it is a form of product differentiation which communicates quickly and effectively a lot of information about a product range - it helps consumers to make key decisions in the market-place.
The Dolmio brand was launched in 1986 when the pasta sauce market was relatively new and worth only £8 million per year. Since that time, Dolmio has been responsible for massive growth in this sector. Today, the market for sauces that are ready for use straight from the jar (known as ‘wet cooking sauces’) is worth £340 million. This is a growth rate of 1,667% in a decade.
No matter how well brands perform, they have to be managed. Before 1994, the Dolmio brand had been responsible for driving the growth in the pasta sauce market, achieving market share of over 40%. However, in 1996, Dolmio suffered a fall in market share at a time when the pasta sauce market was experiencing explosive growth. In particular, market share was lost to the supermarkets’ own brand products and market research revealed that Dolmio was no longer perceived to be significantly different to the competition. The supermarkets’ own brand products were often sold at a cheaper price and were packaged in such a way as to look very similar to the other brands. Market research also showed that pasta was seen as a staple food but that the sauces on offer were not very inspirational.
Understanding consumer requirements is essential for any brand development. It is important to understand how consumers differentiate between brands, as well as the competitive features of the market. The most important aspect of this is understanding how consumers perceive the market-place, the products within it, and the roles and interaction of the brands that operate within it. This provides a solid foundation for any development.
This case study examines the steps taken to regain the initiative in the competitive market in which the Dolmio brand now operates. This involved relaunching the brand with new product variants.
A product portfolio or product range is like a family; each of the children has its own strengths and weaknesses and each needs careful attention and nurturing. It is not a question of simply producing many different products under the same brand name. Markets, consumer tastes and attitudes are constantly changing. This is where the management of the product portfolio becomes important. Managing a brand with a number of extensions involves deciding when to introduce new products, when to relaunch certain products and knowing when they have come to the end of their product lifecycle and need to be taken out of the range.