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RESEARCH PROPOSAL

WAY TO POSITION A CANNED FOOD PRODUCT Case Study April 2012

Jeremy Michael Knight T. Balila Master of Science in Marketing

In Partial Fulfillment of the Requirements for the Advanced Technical Reading and Writing 2

Professor Jose Cristina M. Paria

I. Group Profile

Introduction

Century Pacific Group (CPG) started out as little more than a vision in the mind of Mr. Ricardo Po, Sr. in 1978. After 3 years of diligent research and study, Century Canning Corporation (CCC) was established in the Philippines as a pioneering tuna canning facility focusing mainly on processing and exporting the abundant supply of tuna in Philippine waters. By 1983, Century Canning Corporation had already grown to be one of the largest Philippine tuna canneries, exporting and shipping hundreds of containers to the U.S., Europe and the rest of the world. But it was only in 1986 that Po introduced the product to the Filipino market. In the succeeding years, few enterprises has acquired by the Mr. Po. In between 1998-1999, the Columbus Seafoods Corporation was organized to operate the canned sardine business from a newly built factory in Zamboanga. Also in 1999, General Tuna Corporation was incorporated to continue the canned tuna export business out of a brand new plant in General Santos. Mr. Po also diversifies its product line and led the acquisition and introduction of Birch Tree Full Cream Powdered Milk in the Philippines in 2001. Following its brand of milk and adding to the product line, Angel Milk was launched in 2003. It is part of the company's foray into the milk business, the brand in under the Snow Mountain Dairy Corporation. By 2008, Snow Mountain is now the second biggest liquid milk company in the Philippines and continues to diversify into new and growing food categories like 3in1 coffee and coffee creamer.

Mission Reinforce 4 M's (Marine, Meat, Milk, Mixes) to their fullest potential. Strengthen organization into a world-class, multi-skilled organization with a strong corporate culture. Performance. Performance. Performance. Seek international opportunities to grow our branded business. A team with one heart.

Only a group that shares one mission, united by a common purpose, all pulling in the same direction, guided by Divine Providence can set in motion and realize the Mission of Century Pacific Group. This team knows that our destiny will be a shared one. Success becomes attainable

if we go together as a team. (http://www.centurypacific.com.ph/)

Businesses Century Canning Corporation (CCC) CCC is the marine and tuna enterprise of Century Pacific Group. The brands, Century Tuna, 555 Tuna, Blue Bay Tuna, and Fresca Tuna offer delicious, healthy and superior quality tuna meals every day. The company is consistent in introducing delightful new flavors and variants that every family member can enjoy. Today the brands remain household favorites, making Century Canning Corporation the first name in tuna. It takes a state-of-the art canning facility in Southeast Asia to manufacture and market all these leading brands, assuring consumers of cleanliness, efficiency and superior quality. Its location at the heart of the Philippines tuna capital, General Santos City, guarantees the freshness of our fish, as well as quick and efficient delivery of our products to a network of distributors nationwide. General Tuna Corporation (GT) It serves as the export arm of CPG. The company manufactures private label canned, pouched and frozen tuna products. A world-class facility initially located in Taguig, the plant transferred to General Santos in 1999 to benefit from the proximity to the source of supply in Western Pacific Ocean. The plant's proximity to the supply source, being adjacent to the world's tuna fishing grounds like the Western Pacific Ocean and the waters between Southern Philippines and Indonesia, ensures the availability and freshness of fish. GT is manned by a highly qualified and dedicated team composed of experts in their respective fields-all masters in tuna with a global outlook. Pacific Meat Company Inc. (PMCI) PMCI is the CPGs meat subsidiary. It came at a time when prohibitively expensive canned goods filled the super- market shelves. Local canned meat was sold

at small 150-gram sizes. It came at a time when prohibitively expensive canned goods filled the supermarket shelves. This allowed PMCI to elevate the standard of local canned meat, and made it affordable to the average consumer as well. Columbus Seafood Corporation (CSC) CSC packs value with good taste and quality in the canned sea foods category. Canned sardines, milkfish, mackerel, and squid are branded 555, Blue Bay, Lucky 7, and Century. Responding to the sardine shortage in the country in 1983, Century Pacific Group began producing canned sardines under the 555 name, with a taste profile suited to the Filipino family. Highly visible advertising and marketing strategies pushed 555 Sardines to new heights. Century International Company Limited (CIC) CIC is a joint venture between Century Pacific Group of Companies and Thai Union Manufacturing Company, Ltd., and imports, markets, and distributes international food products like Century Tuna and Fisho snack foods. It is a joint effort to take part in the growing consumer market of the mainland Chinese economy. Now in over 60 major cities in China, Century and Fisho are carried by supermarkets and grocery stores like Carrefour, Wal-mart, Tesco Hy-mall, Metro, and Auchan. Today, Century is the leading brand of canned tuna in the world`s biggest consumer market. CIC has headquarters in Beijing and Shanghai and aims to continue to expand market coverage and implement cost-effective distribution. Pacifica Agro-Industrial Corporation (PAIC) PAIC is a wholly-owned subsidiary of Century Pacific Group and is engaged in the processing and manufacturing of marine by-products, namely fish meal and fish oil. The company was formed in 2007 and has, today, grown into one of the major players in its industry. It is responsible for performing all value-adding processes to transform the marine by-products generated by the tuna and seafood canning factories of Century Pacific Group. The company's manufacturing facilities are thus established in compounds of General Tuna Corporation in General santos City and Columbus Seafoods Corporation in Zamboanga City. The company markets its fish meal and fish oil both as industrial commodities and premium branded products. Fish meal and fish oil of premium or international standard quality are marketed under the Proteus brand.

Brands of Products 555 Sardines In 1983 the company launches 555 Sardines. In just 3 years, this newcomer became one of the top 4 brands of canned sardines in the Philippines, competing credibly with established brands that had been around since World War II. With the tagged line Sarap Ulam Pinoy, 555 is committed to provide budget conscious consumers with high quality but affordable products, thus a constantly satisfying experience with every sardines, tuna, corned beef, meat loaf, and beef loaf. It is trusted by many Filipinos for more than 30 years now, 555 stands for value laden benefits namely delicious and affordable. Century Tuna The year 1986, the company made the decision that the time was right to introduce the sardine-loving Filipino consumer to the healthy goodness of tuna. So Mr. Po launched Century Tuna in the Philippines. Thus began the long and winding journey of education that has resulted in the modest but growing Philippine market for canned tuna, and it became the leading canned tuna brand in the Philippines. A delicious indulgence and it is the classic all-time, healthy meat. It is available in vegetable oil, brine, hot & spicy, and with your favorite variants. It also has Omega 3 DHA that is good for the heart and mind that is low in cholesterol and has no preservatives. Argentina Seeing another opportunity in the rising purchasing power of the Filipino consumer, the company decided to apply the discipline, cost consciousness and competitiveness of the fish processing industry to the meat processing business with the launch of Argentina Corned Beef in 1995. The number one brand in the canned meat market provides Filipino families with delicious and healthy products to enjoy. It has been in the market for 15 years now and continues to delight the entire family with products that fit their lifestyles. Argentina always satisfies the needs of the family, as for mommies enjoy cooking the corned beef, daddies enjoy its canned sisig for their drinking sessions, the brother and/or sister love to share beef loaf with their friends, and young ones are delighted with the meat loaf. Blue Bay Tuna

Blue Bay is also one of the product lines of the CCC and CSC, and set a variety of tuna and sardines that differentiates with its various flavors in the market for the consumer. It set to be positioned as an alternative to the premium canned tuna in the market. Available in tuna and sardines, it is deliciously irresistible and unmistakably fresh. The sea's bounty and farm's harvest make one delightful feast. Wow The Pacific Meat Company, Inc.'s (PMCI) newest and fastest growing brand today as it was inspired by regional Filipino cuisine. Wow is synonymous to innovative, great tasting, filling, and affordable canned and fresh processed meat products. Perfect for the busy, discriminating and budget conscious working class. It offers a wide range of value for money and quality fresh processed meat products that are delicious, flavorful, and has the right blend of sweetness and saltiness that kids will surely love Fresca One of the tuna brands of Century Canning Corporation, the Fresca brand adds to the array of canned tuna in the market. With the difference of many flavor variants of canned tuna that sets a distinct attributes to the other brand tuna of the corporation. Lucky 7 Adding to the line of tuna products of Century Canning Corporation, sardines of Columbus Seafoods Corporation, and meat product of Pacific Meat Company, Lucky 7 was launched. As a good taste, good quality, and excellent value all packed in a brand meant to provide delectable and affordable meals to budget-conscious families. Shanghai As the company tagged line for their own brand of luncheon meat, The value-formoney luncheon meat, Shanghai Chinese Luncheon Meat is the affordable Chinese luncheon meat made of pork meat blended with spices. It is an ideal meal in itself, as sandwich filling or combined with ingredients to come up with delightful recipes that everyone will surely love.

Accreditation United States Food and Drug Administration (USFDA) USFDA is an organization under the Department of Health and Human Services. They set the standards in US to be met by food manufacturers to promote and protect public health. These standards cover a wide array of products from food to pharmaceuticals. (http://www.fda.gov) Orthodox Union (OU) OU is a certifying agency following the teachings of the the Jewish law (Kosher approved). It is based in New York and generally recognized by the North American Jewish and non-Jewish alike. They ensure that products comply from the ingredients, equipments and actual preparation standards set by the Torah and Jewish Dietary Laws. (http://ou.org/) Canadian Food Inspection Agency (CFIA) CFIA is a branch of the Canadian Government responsible for 14 inspection programs and services that are related to foods, plants and animals across Canada. They abide by the standards that were established by Health Canada. (http://www.inspection.gc.ca/english/util/faqe.shtml) Hazard Analysis Critical Control Point (HACCP) HACCP is a management system in which food safety is addressed through the analysis and control of biological, chemical, and physical hazards from raw material production, procurement and handling, to manufacturing, distribution and consumption of the finished product. (http://www.fda.gov/food/foodsafety/hazardanalysiscriticalcontrolpointshaccp/default.ht) British Retail Consortium (BRC) BRC is the leading trade organization in the UK. They represent all forms of retailers in the UK from independently owned stores to big chain supermarkets and department stores. Companies supplying retail chains under their private label food products have to comply with the BRC standard, they are the industry-wide benchmark for quality and food safety. BRC widened its reach to the world retail market, with brand owners in USA requiring this accreditation as well. (http://www.brc.org.uk/brc_home.asp)

International Food Standard (IFS) IFS are a globally recognized standard for auditing retailer and wholesaler branded food product suppliers. These standards can only be applied for processed food products or when there is a hazard for product contamination during processing and packaging. (http://www.ifs-certification.com) European Union (EU) The EU is the economic and political union of 27 European Member States. They have established their standards based on Codex Alimentarius for acceptable food products to be exported to Europe. These strict standards only allowed accredited companies to export to Europe, without any accreditation a company will not be allowed business in any EU member country. (http://europa.eu/)

Corporate Social Responsibility Century Pacific Group has been doing its Corporate Social Responsibility (CSR) Programs such as educational scholarships, poverty alleviation, and helping the less privileged. The Century Pacific Group - Ricardo S. Po (CPG-RSPo) Foundation, Inc. (http://www.centurypacific.com.ph/webadvocacies.php) partners in the existing Feeding programs of various Socio-Civic groups, Non-Governmental Organizations (NGOs) and Foundations by donating its canned products. The CGP - RSPo Foundation, Inc. is the brainchild of the Chairman and Founder Mr. Ricardo S. Po Sr. He thought of establishing the foundation as the socio-civic arm of the company so that it could help support some of the major issues facing our country today such as hunger and malnutrition, education and environment. The Foundation is his way of giving back to the community and to the many loyal and dedicated consumers of the products of Century Pacific Group. It has three main thrusts: To help in feeding the poor and hungry children and to provide healthcare if necessary To help in providing education to deserving student To support other charitable and humanitarian causes, most especially the protection of our environment

Century Pacific Group wants to convey its purpose, "Nourishing and delighting everyone, everyday, everywhere. The KAIN Po Feeding Program which stands for Kalusugan at Isipan Naalagaan was launched to officially brand the Foundations Feeding initiative which aims to alleviate malnutrition and hunger and to nourish children by not just feeding the body but also the mind. To date, it has already achieved more than 3 Million meals since it started in 2010. This milestone was made possible through partnerships and collaboration with 81 partners nationwide.

II. Points of View

Analysis

Century Pacific Group has been in the canned-processed food industry for years. The group had already established its firm and stable niche not only in the market but as well as in the perception of the consumers. As the group caters to various needs and wants of the consumer because of its vast product line of tuna, sardines and meat products, it enables the group to capture the different types a segmented target market. It caters to the yuppies, old, male, female and kids alike, but to the extent of the demographics it serves to the health conscious and prize sensitive consumers with the added benefits of good quality and emotional value of the product. The group expands its businesses in a very positive way in maintaining its position in the market as a competitive and leading food product brand in the industry. With the extended product line of milk and coffee products, it will cover more segment market for the group. Moreover, the group will continue this activity of introducing and extending more products to their portfolio to furthermore expand the group. In line with this expansion, the group now manufactures fish oil and fish meals that serve as a supplement for the marine and aquatic animals. Therefore,

Problem Statement In many cases of certain company or corporation, one would want their enterprise to grow and expand their business, increase its market share and brand

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equity, and most of all satisfy consumers needs and wants. In the history of Century Pacific Group, it started only as canning company and in the years it came they introduced its own brand of product, and now it delivers a in depth line of tuna, sardines and meat processed products. As it caters to many consumer segments in the market, covers many markets, and can attract new market, what would be its advantages and disadvantages for the consumers? Would the consumers see any differentiation in terms with the groups product portfolio? After decades of serving the consumers the quality of products Century Pacific Group, how would brand can be distinctive enough to be able to sustain its equity and benefited the group as well? Lastly, as it already achieved its goals and objective to be the largest canneries in the country and a leading brand choice for the countrys market, could the group penetrate the global market as well?

Areas for Consideration Brand Positioning Brand Positioning or brand strategy is one part of the corporate strategy. It is at the center of a corporate strategy that bridged brand position to the consumers mind. It is about finding a right place for a brand in market as well in consumers perception. It is also important to understand the corporate strengths and capabilities which will produce the desired position, and; the current and potential position in the market. Ries & Trout (1981) said, You concentrate on the perceptions of the prospect, not the reality of the product. A consumer should easily identify that for a given need or want this is the brand. If brand fails to do this, it simply becomes just another product or commodity on supermarket shelf. An organization must commit to the concept of branding and accepts the nature of strategy: Strategy starts with customer satisfaction Strategy must be long term Strategy must be competitive Why? Consumers only accept what is consistent with prior knowledge or experience

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Very difficult to change the perception once formed How? The easy way to get into a persons mind is to be first If you didnt get into the mind of your prospect first, then you have a positioning problem Better to be first than be best Even if you are not first, be the first to claim a unique position in the mind of the consumer Be first to get into the prospects mind The basic approach is not to create something new or different, but manipulate whats already in the mind To find a unique position, you must ignore conventional logic, conventional logic says you find concept inside product

Choosing a Brand Position Brand position will be something that consumers throughout the market understand and express. A brand has therefore to be designed so that all elements of the marketing mix communicate the same message, Arnold (1992). The design process will by definition involve nearly all the companys functions and operations. The selection position will probably involve a searching analysis of the companys own strengths and weaknesses. And then after, aspects which do not contribute to the position can be designed out of the product. Approaches for Positioning Strategies Mass-Market Offers only one brand, and hopes to pick up customers from all parts of the market. Effective in a young and unsegment market. Focus is on the need rather than the overlaying wants. It its brand is unique, it simply needs to support its brand strongly for customers to be attracted. Success of the brand has more to do with the uniqueness of the offer Niche Market

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Offering only one brand and targeting it at only one segment. One segment is distinct from the rest of the market. Advantage over mass-market. Consumer usually prefers a specialist offering. Dangers may implicate because consumers sharing a want are bound to change as the want change. Moreover, a segment may disappear. Differentiated Market

Company to offer several distinct brands to attract various segments. It can either launch new brands or introduce variants of the original brand. Its advantage is it covers most of the market. It is clearly the least-risk approach because of the extent of the portfolio. However, it is the most expensive way of operating because each brand must be supported with its own marketing.

Brand Personalities (Book by Chris Macrae: World Class Brand) The Ritual Brands associated with particular occasions, to the extent that the brand is the whole experience. The Symbol Image brands where the symbol is the added value because of its associations. The Heritage of Good Usually the first brand to have established a specific set of benefits, which can then position itself as the pioneer of this sector. The Aloof Snob Brands which help a consumer give signals that he or she is different from the others. The Belonging

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Brands which make the consumer feel part of a larger group with which they want to identify. The Legend

A brand which have a real history and have become almost mythical in the market.

Brand Equity Kevin Lane Kellers Brand Equity Pyramid Model

Brand Resosance

Customer Judgements & Emotions

Brand Communication & Behavior

Brand Salience

Brand Salience The goal is to create brand awareness and need to make sure that your brand stands out, and that customers recognize it and are aware of it. And, it is also trying to ensure that brand perceptions are correct at key stages of the buying process. - Who Are You? Brand Behaviour & Brand Communications Is to identify and communicate what your brand means, and what it stands for. The two building blocks in this step are performance and imagery. What Are You? Consumers Judgements & Consmers Emotions

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Consumers' responses to your brand fall into two categories of judgments and feelings. They may also respond to your brand according to how it makes them feel. The brand can evoke feelings directly, but they also respond emotionally to how a brand makes them feel about themselves. What Do I Feel About You? Brand Resonance It is the top of the brand equity pyramid because it's the most difficult, and the most desirable level to reach. The brand has achieved brand resonance when the consumers feel a deep and psychological bond with the brand.

III.

Methodology

CPG offers a variety of products, and brands alike. The group positioned its brands as a differentiated market approach, as it cover many market segments and caters to the different consumers. It enables the group to target various segments that differs with their own needs and wants; it is also low at risk because the CPG has extensive line of products that the consumers can choose from. However, it can cause confusion to the market as the group has two to three brands of tuna, sardines and meat products. The fact that it delivers several brands and serves to each different market segment; it may cause the premium brand like Century Tuna to cannibalize its other tuna brands of Blue Bay Tuna and Lucky 7. Furthermore, with a less differentiation on the product, it may cause some dilemma of brand dilution of the other brands. Like in meat-processed product of the CPG, the Argentina is a well-known brand of canned meat product for years, and the group has also the brand of 555 and Shanghai considering a competitor on the three brands. In the Kellers pyramid model, Century Tuna has achieved brand resonance because as the consumers top of mind when it mentions tuna the brands come in first place. The brand has establish its position as a premium yet healthy product, with the fast growing market of healthy conscious consumers it assures its stability in the years to come. Following the brands extensive advertising, promotional activities, endorsements, and maintaining its brand image as a quality and healthy product helps the company establish its brand equity to the market.

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Recommendation For the past decades in becoming the largest canneries in the country expanding and exploring the groups business globally is a tough challenge. It would face an extensive market analysis, a lot of research and development when it comes to the product offer, brand image that the group wants to the international market be perceive, marketing and communication, cultural differences, environmental issue and government issues. The group has already started exporting in China by CIC, with a joint venture with other company. CIC has headquarters in Beijing and Shanghai and aims to continue to expand market coverage and implement cost-effective distribution. (http://www.centurypacific.com.ph/webcontent.php?d=cD0zJnBjPTcmYmQ9) Targeting the consumers in China is difficult it terms of cultural differences and mainly marketing the product. But when it develop as fast growing market for the CPG it will surely add up to the years of experience in the industry, because China has the potential to be growing market when it comes to its population. For the groups to grow and penetrate the global market, CPG must continue to develop new products to deliver and satisfy different needs and wants that may hinder in the international market. Continue developing the fish food as the product can be easily marketed in the international arena for its many benefits that supplement the fish globally. Lastly, maintaining the corporate image through advertising, marketing, and corporate social activities will ensures the groups future. It is because, as Ries & Trout (1981) says, change is inevitable and the market leader must be willing to embrace change.

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Reference Arnold, D. (1992). Handbook for Brand Management. Great Britain: The Bath Press Ries, A & Trout, J. (1981). Positioning: Battle for your Mind. New York, USA: McGraw-Hill Co. Kellers Brand Equity Model. Retrieved: March 29, 2013 from http://www.mindtools.com/pages/article/keller-brand-equity-model.htm Century Canning Corporation. Retrieved on March 27, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD0zJnBjPTEmYmQ9 Century Canning Corporation. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD0zJnBjPTEmYmQ9 General Tuna Corporation. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD0zJnBjPTImYmQ9 Pacific Meat Company Inc. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD0zJnBjPTMmYmQ9 Columbus Seafood Corporation. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD0zJnBjPTYmYmQ9 Century International Company Limited. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD0zJnBjPTcmYmQ9 Pacifica Agro-Industrial Corporation. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTIyJmJkPTI0 555. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTExJmJkPTEz Century Tuna. Retrieved on March 27, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTkmYmQ9 http://www.centurytuna.ph Argentina. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTEwJmJkPQ Blue Bay Tuna. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTE1JmJkPQ

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Wow. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTE2JmJkPQ Fresca. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTE3JmJkPQ Lucky 7. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTE4JmJkPQ Shanghai. Retrieved on March 28, 2013 from http://www.centurypacific.com.ph/webcontent.php?d=cD00JnBjPTE5JmJkPQ United States Food and Drug Administration. Retrieved on March 27, 2013 from http://www.fda.gov Canadian Food Inspection Agency. Retrieved on March 27, 2013 from http://www.inspection.gc.ca/english/util/faqe.shtml Orthodox Union. Retrieved on March 27, 2013 from http://ou.org/ Hazard Analysis Critical Control Point. Retrieved on March 27, 2013 from http://www.fda.gov/food/foodsafety/hazardanalysiscriticalcontrolpointshaccp/default. htm British Retail Consortium. Retrieved on March 27, 2013 from http://www.brc.org.uk/brc_home.asp International Food Standard. Retrieved on March 27, 2013 from http://www.ifscertification.com European Union. Retrieved on March 27, 2013 from http://europa.eu/