Transcript BA 499 - Romanos final presentation doc.ppt

 Romano Pastega immigrated to the United
States from Italy in 1907.
 His son Mario Pastega purchased the PepsiCola Bottling Company in Klamath Falls first.
 In 1961 Corvallis, Oregon.
 In 1974 Tillamook, OR,
 In 1986 Medford, OR,
 Ken Pastega, one of Mario’s three son created
the Romano's Italian Soda line.
 "I kept seeing people in coffee shops and
restaurants order Italian sodas, only to receive a
drink that lacked sophistication”
 After seeing the popularity of Italian soda
increase in recent years, Pastega was
convinced that people would buy these
delicious drinks if available.
 In 2005 Romano's was spun off from the
Pastega Beverages and is run as its own
company.
 Romano’s is dedicated to recreating delicious
Italian sodas so everyone can enjoy them.
 Romano’s Italian sodas are available in plastic
bottles and at the soda fountains in
convenience stores, restaurants and cafes.
 Romano’s current primary target market
 Young adults, ages 18-25
 Active, busy, and energetic lifestyle
 Students and young professionals who are social
and ambitious
 Health conscious but still enjoy good food and
drink
 Secondary target market
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High school students
Mothers looking for a good tasting diet soda
Heavy soda drinkers
Parents that are attracted to a healthier beverage
option for their families
 Don’t focus so much on the secondary target
market
 Instead, add a new primary target market
based on an older aged segment of the market.
 The diet Italian soda would work well for this new
segment
 Target to people who may have health issues that restrict
them from consuming sugar
 Product provides a healthier alternative
 Middle age adults ages 45-55 years old
 Health conscious for themselves and their
family
 Active and energetic
 Enjoys socializing with family and long time
friends
 Developed loyalty brands, but are curious to
try new things
 Are educated on the latest products in the
market
 Younger target market
 Age represents about
13,000 people in
Benton County
 Figure to get 20%
response to buy
 Total = 13,000
x 20%
2,600
*population stats based off of the
2000 U.S. Census Bureau
• Older target market
• Age represent a
little more than
11,000 people in
Benton County
• Figure to get 10%
response to buy
• Total = 11,000
x 10%
1,100
 Creating a new target market will increase our
customers
 Provide more sales which will in the long term
add to the growth of the company
 Create great word-of-mouth advertising with
an increase in customers drinking Romano’s
soda
 Enhance the image of Romano’s as being a
healthier alternative to big brand named sodas
Flavors Offered
 Orange Cream (available in Diet)
 Creamy Strawberry (available in Diet)
 Sour Apple
 Vanilla Bean
 Berry Pomegranate
Newest Flavor
 Blackberry – coming in March
 Maintain Romano’s healthy-image
 Stay with non-caffeinated beverages
 Push healthier image by simplifying flavors
 Flavor Trends
 Keep up to date with health-research on the healthiest
ways to sweeten products.
 They currently have a link on their page to “Why
cane sugar is better”
 Look into healthier sugar substitutes like Stevia
 To attract attention of Innovators or Early
Adopters
 Consider offering unique, eye catching
products that have the potential to be the
next big thing
 Examples: “Key-Lime Pie” or “Vanilla-Pear”
etc.
Sell Product at $1.25
• This price-point is very competitive
– Affordable as well
• Compares to prices of competition
– Other soda companies (Coca-Cola, Pepsi, etc.)
– Gatorade
– Sobe (Romano’s Italian Sodas is actually cheaper)
• Greater volume than Romano’s product
• Prevents a “cheap” image – brand equity
– Not too expensive, should not push customers
away
– Gives an equal if not better quality image when
compared to competition
Romano's Price Per Bottle
Retail Price
$1.25
Romano's Wholesale Price
-0.85
Vendor Profit
$0.40
Romano's Wholesale Price
Romano's Production Cost
0.85
-0.40
Romano's Profit Margin
$0.45
Northwest: Oregon, Washington, Idaho
Using information from the 2006 AFS:
Total Population = 399,423
Assuming 2 purchases a week or 104 purchases a year
Savvy Sippers:
TP x .20 =220,795
Classy Connoisseurs:
TP x .10 = 173,628
Segments Combined = 394,423
394,423 x $0.45 (profit/bottle) * 104 (purchases/year)
Total Profit/Year = $19,168,957.80
Market share expected to grow!!!
To ensure the success of the Italian Soda we will:
• Keep a consistent price
– Reduce price barrier
– Current price/volume slightly higher than a Coca-
Cola, however evokes quality perception
• Select Coupons
– In store coupons at select locations such as Roth’s
Supermarkets
• Offer a 2-for-1 promotion
– Back of label coupons
• Reduces paper usage, adds purchase value
 Stronger promotional front
 Expansion into the local community-
Product Placement
 Community activities
 Da Vinci Day, Fourth of July, Fall Festival,
Saturday Market
 Oregon State University
 Sporting events
 Greek Life Events
 Campus functions
 Sponsorship
 Local schools, fundraisers, PTA meetings,
Bingo Nights
 Boys & Girls Clubs- teams, events
 Intramural Sports through Oregon State
University
 Teams, jerseys, gatherings, and
celebrations
 Campus events
 Hang banners, host a concert, provide
sustenance in a beverage garden
 Expand advertisements
 Already tapped into radio air time
 Look locally:
 Dixon screen advertisements
 Reader boards
 Inserts in the Daily Barometer
 KBVR Television and radio
 Provide entertainment/deals with the
drink
 Lid entertainment
 Like Sobe or Snapple, place sayings under the lid
 Teach consumers Italian sayings
 Like Coke or Pepsi, relate the use of lid sayings or
promotions to a website that is interactive, so the
consumers is excited to drink more
 Coupons
 Under the label, place a coupon that will benefit
the consumer on their next Romano’s purchase
 Budgeting
 Expanding promotion will require a larger
budget
 Such promotional tools like newspaper
inserts and coupons will be more costly
 8,000 minimum inserts at $70 per 1000 =$560
 Sponsorships also require funding
 The more teams, events, activities sponsored, the more
financial support needed
 The bigger the idea, the more money
needed
 Promotion will have to be implemented over
time as revenue increases
 Romano's Italian Soda is available in
fountain, bottled beverage, vending
and granita machines.
 Throughout Oregon
 Over 200 different locations around
Portland
 Over 50 location around Salem
 Washington and Idaho
 Battleground
 Vancouver
 Longview
 Indiana
 Warsaw
 Many small “Ma and Pa” stores
 Roths & Thriftway
 Local delis and markets
 Gas stations Ex. 7-Eleven
 Liquor stores
 Very simple and clean
 From bottling plant in Eugene to
distribution centers
 13 distribution centers total in Oregon,
Idaho and Washington
 From Distribution centers to stores
 From Stores to Consumer
Manufacturer
Distribution
Center
Stores
Consumer
 Romano’s strives to have a strong
relationship with each of its intermediaries.
 Offers buy backs to items that are damaged
or do not sell.
 Reimburse dissatisfied customers.
 Offers in store promotions to selected
stores
 Free samples
 Coupons
 Increase efficiency through technology
 Focus growth in markets that are
farther away
 Increase business to business
connections
 Romano’s is a very young company
 Build reputation and strong brand
awareness
 As the company grows, look into the
option of greatest benefit
 Expanding the company
 Consolidating
 Sell to the highest bidder
 Once Romano’s has saturated the
market, their next step could be selling
to a larger company.
 Current connections with Pepsi
 Production/bottling plants
 Potential buyer when the time is right
 Maybe a smaller company like
Cadbury-Schweppes would be
interested in this unique product, and
be more attractive to Romano’s family
values.
 The goal is to make the most sensible
decision
 Things to consider:
 Family owned and operated company,
does selling the company hurt the brand
image and equity?
 Competition in drink market is intense,
will the product survive?
 Is there a place for this product among the
soda giants?
 When the time is right, Romano’s will
decide if selling the company is a smart
choice
 They are still in their early years and it is
too soon to tell if their products are going
to make it
 The uniqueness of their sodas offer
something new to the drink market, and
the soda giants are always looking for the
next big item.
6 Months
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Add new demographic
Sponsor school & community events
Lid entertainment
Insert advertisement in Daily Barometer
1 Year
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Look into new sugar substitutes
Increase B2B connections – Distributors
Keep current with flavor trends
Back-of-label coupons
5 Years
• Increase efficiency through technology
• Groom business for purchase by a bigger company
 Romano’s is young and strong company
with lots of room for growth
 The market for bottled Italian sodas is
virtually untapped and will be
interesting to watch grow and develop
 With our recommendations the
company will be able to increase their
market share and brand equity
Any Questions?