This document summarizes a case study about Nestle Refrigerated Food Company's (NRFC) launch of Contadina Pizza in 1991. The pizza launch aimed to extend the successful Contadina pasta and sauce brand but sales were disappointing. Key issues were a lack of market research, overlooking major frozen pizza competitors, incorrect positioning of the target segment, and price wars that reduced prices 20%. Recommendations include leveraging the family brand's trust, conducting precise research and pricing forecasts, and not assuming pasta users would automatically buy pizza. The launch provides lessons about testing new products before nationwide rollout.

1. Refrigerated Foods:
Contadina Pasta & Pizza
Harvard Business Studies

2. Content
Abstract of case
Problem Analysis
Solution Recommendations

3. Abstract of case
 Fall 1991, Nestle Refrigerated Food Company (NRFC) launched
Contadina Pizza with the aim of brand extension (successful
Contadina pasta and sauces)
 Refrigerated food product
 Hoped to cross sell pizza to existing pasta customers
 Brand extension: to continue growth with product opportunities
 Contadina Pizza positioned as: quick, convenient, yet fresh alternative
to frozen delivered pizza

4. Abstract of case
 NRFC introduced: kit format composed of pizza shell with separate pouches of
cheese and sauce
 Separately packaged toppings: Pepperoni, Three Cheese Blend and Italian
Sausage
 Pizza kit: $6.19 more expensive than frozen pizza less than delivered/takeout
pizza; toppings: $1.49
 Similar to pasta launch: launched in selected markets in the U.S. over a twelve
month period in 1991-1992
 Marketing support: TV ads, couponing, trade promotions amounted to $11
million in 1991 and $10.5 million in 1992

5. Abstract of case
 1 year after launch: disappointing results
 Contadina sold 4 million units in first year ($13 million in sales)
 Dawn Caldwell: failed to hit any target in volume, trial, repeat
purchase
 First reaction: change advertising, tested three more
 Then: promotions targeted at price
 First year 60% spoilage on toppings: eliminated them started selling
pepperoni & cheese, cheese kit at $5.99 and $5.49
 REDUCE COSTS

6. Abstract of case
• NRFC estimated Contadina pizza’s market size using BASES’s line
extension model
• BASES model: 70% of target households would come from parent
brand and 30% from rest of population
• NRFC projected 24% of US households would be users: actual
number 10%
• Feared competitive pre-emption  no test market
Hoped to find a niche: conducted market research among both
frozen pizza users and delivered/takeout users.

7. Problem Definition
Major challenges of NRFC Contadina Pizza were as following:
Lack of in-depth Market Research
Major competitors such as Kraft in Frozen Pizza, Delivered/Takeout
pizza such as Pizza Hut and Domino‘s
Other members of family brand may be at risk  Pasta & Pasta
Sauce

8. Problem Definition
 Incorrect positioning of target
segment
 Pizza Wars: price fell over 20%
 By 1991: $7.69 comparable to
takeout/delivered pizza

9. According to Stephen Cunliffe: „With the successful
rollout of pasta and sauces, we did not test market pizza
prior to rollout. We were concerned that Kraft already
had a product in test market.“

10. Solution Recommendations
According to us:
• Use your family brand support, popularity, and trustworthiness of
Nestle
• Significant first mover advantage
• Fewer marketing, advertising and positioning costs
• Create your own Research Database
• Pricing forecasts should be conducted more precisely
• Current Contadina Pasta & Pasta Sauce users should not be counted
as an expected market penetration

11. for listening.
Presenters Büşra, Yeşim, and Hilal