A.1.

Steak Sauce, one of the premier brands of Kraft food with a market share of 50% and has high brand awareness. The unit and volume sales of the sauce had remained flat though the dollar sales had increased due to price rises. Heinz 57 was the largest branded competition though they were different in taste and appearance A.1. Steak Sauce line included many varieties, major chunk of revenues were due to Original. Lawrys, is launching a new steak sauce with a similar taste and appearance to A.1.s product Lawrys is looking to charge $3.99 per 11-ounce bottle, which is in direct competition with A.1.s price of$4.99 for a 10-ounce bottle. Additionally, Lawry is asking with the Publix to run an exclusive Memorial Day advertisement with a two-for-$5 promotional price point.

Steak Sauce
Facts (premier brand) Since 1980 First sold in America in the 1900s Acquired by Kraft Foods in 2000 Figures Market share>50% (9 out of 10 steak houses sold it) Servings in a 10 ounce glass bottle Variations: Original, sweet and tangy, Bold & spicy, Thick and hearty and Smoky Mesquite Price: $4.99 Sales: 10% in each holiday week

Marinade
Facts Introduced in 2001
Figures 10% share New item in 2003

Table 1 (operating profit)

2002 A.1 steak sauce A.1 marinades A.1 total 60 2003 plan 62

Table 2 (financial results 02)

Kraft foods Unilever

Total revenue
Operating income Income after taxes

$29,723 ml
$6,114 ml $3,398

$48,270 ml
$5,041 ml $2,441

(10) 50

(7) 55

Table 3
Difference between A.1 Steak sauce and Lawrys
A.1 Steak Sauce Since Mfg by Price Market share Size of offering
PGDM Sec B

Lawrys 2003 Unilever <16% 11oz plastic

4/7/2013

1830 Kraft foods $4.99 >50% 10 oz glass

Packaging

Offering

TBD

2 for $5

STRENGTH :
The company has a large market share. Nine out of ten steak houses serve A.1. High quality and Brand image. WEAKNESS : Consumer only uses small amount of A1 sauce in meal. A.1.s past efforts to expand into the poultry category were extremely unsuccessful. A1 is priced higher than competitors sauce.

OPPORTUNITIES : A.1. Steak Sauce has the opportunity to develop more strategic alliances. Conduct more research about customer. Expand its relationship with distributors and suppliers. THREAT: The Launch of Lawrys Steak Sauce.

Price competition from Lawrys new sauce.

The company is facing the threat of losing a vital partnership with Publix supermarket due to the introduction of Lawrys.

 Low cost: Cost of Lawry steak sauce 11-ounce was $1 less than that of A.1.
steak sauce of 10 ounce.

Similar taste, texture, package: Packaging of Lawry sauce was

in a transparent plastic bottle and the texture was thick and dark , which was little similar as the A.1. steak sauce except bottle.

Supported by heavy advertising: Lawrys planned to put

considerable marketing weight behind its new steak sauce.

Promotions: The introduced Lawrys Live! Which was an interactive

cooking show.

 Advertising

Would produce various new products, thereby expanding its own product line and closing off any entry points into the market. Could also attempt to develop its relationship with its consumers through marketing research and targeted promotions. Combo offer of steak sauce and marinades (two for $7).
Introduce a new variant and also attach free sample ($5)