Coordinating teacher: Dana Radler Student: Laura- Simona Mangu ( group 204)

Bucharest, 2013

Faculty of Business and AdministrationSpecialization Business AdministrationYear of study 2

Brand PositioningThe battle of the mind: McCormick vs. Fuchs

1. Introducing the concept;2. McCormick and Co.;3. Fuchs;4. Logo meaning;5. McCormick SWOT Analisys.6.Fuchs SWOT Analisys.7. Conclusion.8.Bibliography.

Content

„ The is a living entity, enriched or diluted over time, the cumulative result of thousands of small gestures”. (Michael Eisner, CEO Disney).

I ) Introducing the concept:

The brand: -promises, guarantees and certifies; -creates emotional bonds stronger than any commercial resonable argument; -speaks to the consumer about his lifestyle, values and aspirations; -becomes legend: Ferrari, Nokia, Oxford etc.

A brand is not an identity.

Market positioning is what differs from one brand to another in the mind of buyers, or the place occupied in their perceptions over that product.

A product can by positioned on the market by the following elements:

- price;- quality;- quantity;- services provided;- distribution channels;- package.

There are 3 types of positioning:

Functional

Emotional

Senzorial

McCormick is the biggest spice company in the world, with more than 250 brands with high popularity and strong tradition among americans.

With a history of 110 years, McCormick has gain it’s position of the oldest spice company and therefore, it gained the trust of clients for whom traditional and familiar are the most important.

Price positioning: McCormick is using it’s low prices to positionate as a cheap spice maker company.

In fact, McCormick has the lowest prices on the international market for all types of clients, no matter their level of salaries. It’s brands are so called „for every pocket”.

The products are aiming all categories of customers, no matter race, culture, level of education, social status.

Product name McCormick ACH

Brack pepper $ 11,14 $11,50

Chili powder $11,99 $12,30

Paprika powder $12,67 $12,79

Mustard $9,53 $9,79

Quantity positioning: McCormick is oriented in selling big quantities of spices in over 100 countries around the world. This kind of positioning alows the company to focus on large scale productions in order to reach every customer in every corner of the globe.

Distribution channels positioning: McCormick has always been preocupied in expansion it’s distribution channels, because they contribute to higher earnings.

The main marketing channels used are: retailing inside/ outside stores, wholesailing.

In some countries ( ex. Poland) McCormick uses selective distribution which means that products are available for selling only in few stores located near popular areas.

Emotional positioning uses McCormick brand images, starting the moment of acquisition by the customer. The category that fits best with this type of positioning is represented by the organic spices which customers identify with health and proper life style.

Few examples of organic products: Organic Bay Leaves, Organic Cloves, Organic Coriander, Organic Cinnamon, Organic Black Peppercorns.

Senzorial positioning is based on sensory experiences resulting from specific brand attributes such as taste, flavour in order to meet the needs and expectations related to feelings and stimulation.

Visual stimulation

Mass media and publicity

The most specific media campaigns, with big impact over people and social opinion was the campaign „ Grill Mayor”, that rewarded McCormick with the Best social Location- based campaign.

The participants had to check in using FourSquare technology on the grilling done by other people. At the and, the person with the most check-ins at his/her grill gets the honorary title of mayor of Hunt valley, Maryland for one day.

Because of the history background, old population is the main client for McCormick brand.

Fuchs- the german leader in the european spice market

Fuchs company is no 1’s Europe spice producer and the 2nd in the world.

The company is originated from Germany and it’s expansion was so big and it’s social impact so powerfull that today, it is the no1 choice of spice lovers.

Like McCormick itself, Fuchs is using price positioning, but in the oposite way.

It is promoting premium products with higher prices than others, but also with high quality.

For example, Fuchs Grill condiments is sold for $ 3,20/ per 175 g, while Kotanyi ( the main competitor on the european market) is selling the same product for $ 2,99.

We meet again the distribution channels positioning.

Fuchs is practicing retailing mostly, also wholesaling to main distributors ( Lidl, Carrefour etc.)It has stores in every big city from almost 40 countries, and it is planning to extend with another 20 starting 2013.

As type of positioning on the market , Fuchs is using functional positioning. The client evaluates the performances of the product, in this case the spices with the highest quality, with no conservants, 100% natural.

Sensorial positioning has the same functions as it does to McCormick. It creates a certain addiction to smell, taste, flavour. 60 % of the customers choose spice products based on those elements, sais Fuchs Research Department.

Best selling products are those with stronger flavour and colour: Fuchs Black Pepper, Mix for hungarian gulas, Spicy mix for american barbeque and Mustard.

Fuchs failed to positionate properly at it’s first media campaign. The management department agreed to position the brand on the shelf with other cheap products and therefore, the public’s impression, that exists even today, is that Fuchs provides low/average quality products.

Mass media and publicity

In Romania, Fuchs used local celebrities to promote their Cosmin brand in a TV commercial. We are talking about Andreea Marin, a strong, appreciated woman with a solid background carrer and knowlegde about advertising. She associated her image with the spice company’s brand, and the trust in it came almost instantly from the clients.

A very important part of positioning is finding the right logo!

Some say that a company’s logo is the element with a bigger impact than the product itself. I personaly believe that the two came in a direct relation, one cannot create an identity without the other.

Mc Cormick has a very mind-keeping logo which states

„ Brings passion to flavour” or „The world of flavours”, the second one corresponds to social campaigns where loyal coustomers have the chance to get contact with the company itself.

Mexico new product campaign, logo means „Try the tasty”.

On the other hand, Fuchs Company adds after the imposing „ Spice & Flavouring Technology” , their official logo „... and add just a little more Fuchs”. This can be interpreted as following: the company aims well educated potential coustomers and hopes to atract medium classes of society.

McCormick- SWOT AnalysesStrengths: Weaknesses:

1.McCormick has build in aprox. 100 years a strong name that is deeply implemented in the consciousness of the american population. It is the oldest spice and flavour- maker company from USA.2. In 2012, McCormick has been officialy recognized as the world’s biggest spice producer and manufacturer, as the numbers show it.

1. The company doesn’t produce a line of bio or organic spices for this constantly extended domain.

Opportunities: Threats:

1.Growing popularity of the Asian, Japanese and Indian spices among americans offers the opportunity of developing business in this area of oriental cuisine.2. Future investments to make in other countries where the McCormick brand is not yet very well known.

1.The growth of small, traditional store-brand products.2. Customers have an easy tendancy in the present days for oriental spices and exotic recepees, type of products that McCormick is not yet focused on.

Fuchs- SWOT AnalysesStrengths: Weaknesses:

1. It’s no 1 position on the European market, 1st choice of East-European people and 2nd largest spices producer in the world.Fuchs is known as the „biggest player” on the european field, with a market share of 48 %, followed by austrian Kotanyi 30% and other producers 22%.2. It is owning research laboratories ( one of them spotted in Romania, the only one in East Europe).3. It carries it’s own line of packaged organic spices and herbs.

1.Underestimation of the Fuchs products from it’s customers.2. Non-orientation over the poor population

Opportunities: Threats:

1. The possibility of entering on the asian market. Fuchs premium products will be high appreciated in the orient for their quality.

1.Growing sales of cheap brands such as Kotanyi, with a 5% rise in 2012.2.Large number of competitors.

The two companies, although they focus on the same market ( spice manufacturing) and they target the same types of consumers, they never created difficulties to one another in the process of competition. This is because the spice market is in continuous expansion and the only direction it can go is up.

Conclusion:

Bibliography 1. „The Economist” magazine. 2.Newspaper articles: Financiar Newspaper,

Libertatea Newspaper. 3.”Foxx Business Topics” ofiicial website. 4. Wikipedia ofiicial website. 5.Fuchs official website ( www.fuchsspice.com). 6.McCormick official website (

www.mccormick.com).