Brand Strategy – When you own the category

National Foods_small

What do you do when you dominate the category you compete in, what is your strategy for growth? It requires you to actually start behaving like a leader. It means stepping up to the mark to grow the category. When you have the bulk of the market share either with an individual brand or a portfolio of brands you have little to gain by trying to keep stealing share from the minnows in the category.

National Foods in Australia is a great example of a company that owns the specialty cheese category. It has over the years acquired all meaningful competitors and now has a portfolio of brands that includes King Island Dairy, Tasmanian Heritage, South Cape, Australian Gold, Tilba, Mersey Valley, Heidi Farm and Mil Lel. A great mix of brands that serve different segment needs or play defensive flanking roles.

However, when you acquire the competition you also remove a legitimate form of stimulation from the market. Competitors in the category regularly compete on promotional offers that serve to stimulate demand. But when you own the category you have a different trade-off equation between price promotion/lower margin and increased sales. There is no fun in having a promotional offer that simply steals share from another brand you own.

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So, when it is not a market share game the challenge becomes how are you going to grow the sales volume of the category. National Foods has embarked on such a strategy with its Cheese Matters program. This has involved the creation of a website http://www.cheesematters.com.au with its own resident cheese ambassador, foodie Naomi Crisante, master classes, food magazine ads and more. A noble endeavour to increase the cheese knowledge and appreciation of Australian consumers, and hopefully then consumption levels, as currently Australians have less than half the per capita consumption of the French.

It is a great initiative, having just completed a second week long horse ride in France, and being fed cheese every meal, every day, I witnessed the (and consumed) the potential upside. It was great cheese (and Australia has great cheese), it was accessible and it was eaten with great gusto.

But the approach by Cheese Matters will be a very, very slow build. By itself it will not produce a significant increase in cheese consumption. Google cheese, or cheese hints, or cheese education, or cheese knowledge and see what you discover. At this point you will not discover the Cheese Matters website in the top ten sites listed. Enter cheese types and cheese and wine matching and bingo the Cheese Matters website is in the top ten. It has a lot of work to do.

In terms of global website traffic rankings;

www.cheesematters.com.au is ranked at 3,572,984.

This is a long way short of www.cheese.com which is ranked at 223,816,

and www.artisanalcheese.com at 288,371.

If you compare these cheese websites with wine it is even a greater reminder of the gap that needs to be narrowed. The traffic ranking for www.wine.com is 32,735 and www.winespectator.com 35,994.

When you add to the above facts that 40% of Cheese Matters site traffic is coming from outside of Australia then it becomes an even bigger call to action to put in place a website optimisation strategy. When you are a category leader like National Foods in the specialty cheese category, a leadership gesture like Cheese Matters is a great initiative, but unless you can drive traffic to the maximum it is going to take a long, long time to build the level of cheese appreciation in Australia to a point where it translates into a per capita growth in consumption.

Pete

5 Comments

  1. Great post, It occours to me that it is also linked to a common misunderstanding that a website is something you publish and then move on to the next marketing initiative, which is ok if all you need an online brochure, but if your website has to connect with a community and raise some profile it needs to be live, with a consistent level of input and maintenance to become a useful tool for that community.

  2. It’s a great marketing initiative and certainly makes sense when they own the category. But, will it grow the category, or just give the people who love the category a forum? Not that that’s a bad thing of course, but I’d worry that with so many brands within their own portfolio let alone the category, another new brand will take considerable investment to build. Perhaps the reason why it hasn’t quite garnered the following it’s aiming for just yet. I like the events, masterclasses etc, but there’s a fair amount of ‘plugging’ for National Foods own brands. Does this limit its credibility? Well researched post!

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