As part of a Marketing course for my MBA, each team was tasked with supporting a firm on a real marketing issue. Foster Farms approached us with a tough but interesting problem to solve:
How can we increase the market adoption of turkey?
Since presenting our marketing strategy in December of 2018, Foster Farms has developed a new brand identity that closely echoes our recommendations.
Foster Farms website (before)
Foster Farms website (after)
Foster Farms’ marketing objective is to increase sales for its turkey products. However, there are significant challenges that Foster Farms currently faces.
- Foster Farms has weak brand equity because of its image as a low-cost poultry producer for bargain market grocery chains.
- Turkey sales are declining as a whole across the industry because of the lack of education, promotional awareness, and accessibility in turkey foods.
- Turkey is poorly represented in Foster Farms’ product offerings.
- Foster Farms faces fierce competition despite being based in the West Coast.
In order for Foster Farms to grow its turkey sales, we recommend as part of an overall corporate rebranding strategy that Foster Farms create a wholly owned subsidiary called Harvest Table, which will be given its own marketing budget and be strictly responsible for driving turkey adoption.
Harvest Table will have its own brand identity, while echoing the values and messaging of its parent brand, Foster Farms. With support from the parent brand, Harvest Table will take advantage of Foster Farms resources and national standing to deliver a new, premium and farm-to-table image.
With an emphasis on inbound marketing and product convenience, Harvest Table will increase sales by offering smaller, more accessible portions of turkey and boosting its social media presence with Search Engine Optimization (SEO), influencers, and educational content.
For health-conscious millennials in California, Harvest Table is a wholly owned subsidiary of Foster Farms, which unlike Butterball and Jennie-o, promotes and provides customers with inspiration for a healthier lifestyle through convenient and high-quality turkey products.
Foster Farms understands that its West Coast footprint allows it to relate to its customer’s fun-loving and energetic lifestyle. Their market research shows that Foster Farms customers are more adventurous, easy going, and creative, so they are always on the lookout for new foods or trends that are coming up on the horizon. Foster Farms’ target customer base for their turkey products is best defined as the Millennials. Between the age of 24 to 38, Millennials are a total market size of 72 million across the United States.
Many Millennials prefer organically certified and locally sourced ingredients to maintain a healthier, well-balanced lifestyle. In the past year, sales for food claiming to be organic have grown 10%. Start-ups delivering innovative foods with natural ingredients are becoming the brand choice over big brands who are notorious for using artificial and processed ingredients. As a result, big brands lost 3% of their shelf-space at supermarkets between 2011 and 2016, equating to over $22 billion in sales. In 2016, sales for Procter & Gamble, Unilever, PepsiCo, and General Mills declined for the first time in recent memory (“How Millennials’ Taste for ‘Authenticity’ is Disrupting Powerful Food Brands,” 2018).
In general, Millennials are more likely than prior generations of the same age group to live at home and delay milestone purchases, such as a house or a wedding, in order to save money. Being at home, Millennials have influence over their Gen X parents’ purchasing decisions.
Millennials are also environmentally conscious. According to Euromonitor, 61% of Millennials feel that they can make a difference to the world through their choices (“How Millennials’ Taste for ‘Authenticity’ is Disrupting Powerful Food Brands,” 2018). Millennials are therefore more likely to purchase foods with sustainable packaging (“8 Ways Millennial Eating Habits are Different,” 2017).
Millennials grew up through the transition to Web 2.0 — the technological explosion of the internet and social media — which has molded their interest in consuming social content online. Millennials not only scour the web for resources but are also highly influenced by social connections, social media personalities, culinary channels, and even healthcare professionals for dietary recommendations.
Millennials are also more likely to engage with brands on Instagram than Facebook — 68% of Instagram users interact with brands while 32% do so on Facebook (“Instagram vs. Facebook: What’s the Better Marketing Avenue?”, 2018). As illustrated in Exhibit 1, results from the YouGov-Mint Millennial Survey showed that for every new generation, Instagram is rising in popularity over Facebook (“Why Instagram Has Become the next Facebook,” 2018).
Foster Farms started out as a family-owned, vertically integrated, poultry production company in 1939 and remains so to this day. They have successfully branded themselves as a farm-fresh poultry producer, providing poultry meat to their customers that is never frozen and always fresh. Foster Farms has cemented themselves as the West Coast’s #1 fresh chicken brand and are very competitive in the frozen and prepared foods markets, ranking as the #2 cooked frozen chicken brand, #2 corn dog brand, #5 lunch meat brand, and #2 Ground Turkey brand in the West Coast region.
Foster Farms’ turkey division is slowly declining in profit and there has been an over-reliance on Costco distribution. Since turkey is more expensive than chicken per pound, consumers are less likely to consider turkey as their poultry of choice. Turkey is also seen as a seasonal meat product, specifically for Thanksgiving so the product is not associated as a year-round meat product. Additionally, the company has not been able to reach the millennial target market. Furthermore, Foster Farms’ website and social media platforms are not as strong as their competitors.
The Foster Farms brand name has a lot of brand equity behind it. Years of marketing their brand as farm-fresh chicken have let them take a stronghold in the chicken business on the West Coast where their primary production facilities are located. This presents an opportunity to leverage their brand in a novel way to break the barrier into the turkey market and compete better with Butterball, Jennie-O and Cargill. Leveraging off of the parent Foster Farms brand, the company can create a new sub-brand for their turkey products. Foster Farms can also take advantage of social media, revamp their website, provide turkey recipes and work with social media influencers and collaborators to engage with their customers.
Foster Farms’ competitors are gaining market share in the turkey industry. Many consumers also do not find turkey appealing as evidenced by the decline in turkey sales across the industry.
The turkey market is dominated by 3 big players who hold 73.8% of the turkey market (Butterball, Jennie-O and Cargill). When comparing Foster Farms to the big three, the main thing distinguishing Foster Farms in the market is its West Coast location, in contrast to the Central region location of its competitors. We look at how Foster Farms can better play up their West Coast centric image to get a leg-up on their competitors.
We conducted a survey to gain a better understanding of our target market and our consumers’ thoughts on turkey. Our survey was shared with family, friends, and online platforms including Mechanical Turk and Reddit. A total of 171 Californians completed the survey. A majority of the survey participants (63.2%, n=108) were Millennials within the age group ranging from 22–37. More than 58% of the Millennials who completed the survey are female.
Our survey results indicated four interesting points about this age group. Firstly, when asked about the frequency of turkey consumption, Millennials are more likely to fall under either the “yearly” or “never” categories in total than all other age groups.
Secondly, despite the above fact, more than 85% of Millennials rated their feeling about turkey at a score of 5 or higher (on a scale from 1–10). About 50% of Millennials indicated that they “love” turkey (scores ranging from 8–10).
Thirdly, our survey results also indicated that Foster Farms is the leading brand that comes to mind when Millennials think about turkey brands, followed by Butterball (Exhibit 5). This is understandable given the California focus of our survey and Foster Farms’ West Coast leaning, and establishes why we believe Foster Farms should focus on California as a test market for improving turkey sales, explained in later sections.
Lastly, Millennials noted that they would purchase more turkey:
- if prices were lower,
- if more recipes were available,
- if they knew that turkey was a healthier alternative to other meats, or
- if there were more convenient portions sold at markets.
Since many Millennials are currently not consuming turkey regularly, there is a potential market to target within Millennials, as there is room for growth within the population. Additionally, while there are Millennials who “love” to consume turkey, there is also a potential share of millennials that Foster Farms can capture, particularly the 35% that “like” turkey.
Harvest Table is a premium, farm-to-table sub-brand of Foster Farms that offers fresh, frozen, and prepared organic turkey. With Foster Farms’ vertically integrated business model, unlike its competitors Butterball and Jennie-o, Harvest Table is backed by a fully integrated supply chain and can promise fresh, non-GMO products from pasture-raised turkeys and other natural ingredients. This new brand appeals specifically to Millennials, who are health-conscious, have an affinity for locally sourced foods, and value new experiences. The core values that Harvest Table will embody in its messaging are wellness and convenience. While the Foster Farms parent company can focus on its existing brandy equity with chicken products, Harvest Table will be a dedicated marketing team focused purely on driving sales for turkey products.
Harvest Table will carry all of Foster Farms’ existing turkey products, including the raw meats and fully cooked items. Among the turkey products sold, high value parts like turkey breasts can be made into smaller portions, as the target customers of Millennials prefer portions that are more manageable for everyday cooking, as indicated by our survey. For example, rotisserie turkey drumsticks could be an alternative to rotisserie whole chickens, which are sold in many grocery store as a high-demand product, particularly at Costco.
Currently Foster Farms packages its raw meat products with the Foster Farms label and die-cut windows to reveal the inside product. For a commodity like turkey where the average consumer doesn’t know how to cook it and where the package is placed directly next to competitors, having high-quality photos showing examples of how turkey can be cooked is extremely important for engaging and educating consumers walking by. Additionally, to appeal to the Millennial target market, the packaging should use sustainable, eco-friendly materials.
Harvest Table will target Millennial Moms and Hipennials. The household income for Millennial Moms is generally higher than average, making them the wealthier segment compared to all other Millennial segments. With their high purchasing power, they will be willing to spend more for items that have premium quality and recognizable benefits for the family. Millennial Moms also have an intense social presence with friends and family and are digitally savvy.
On the other hand, Hipennials are willing to pay more for premium quality items that benefit their well-being. Also, because they generally live at home with their parents, they have a large influence on their family’s purchasing decisions, which Harvest Table can leverage. Hipennials are highly social and seek experience over substance. They are not only conscious of the wellness of their own mind and body but also of the environment and therefore prefer natural, and sustainable foods over artificial and processed foods.
Premium prices, especially when they are higher than the competition, give consumers the perception that the product is of higher quality and greater value. Whole Foods meat, produce, and egg prices are on average 9 to 15% higher than the market average of traditional grocers (“How Whole Foods Price Drops Compare to Traditional Grocers,” 2017).
To invoke a premium, high-quality image, Harvest Table can mark up its turkey products within 9 to 15% to match the price range for organic, farm-to-table items commonly sold in high-end grocery stores like Whole Foods. For a crowded commodity like turkey, the markup is a comparative pricing strategy that gives consumers the perception that the product is of higher quality and greater value. Every other product in comparison will feel like lower-quality items.
Based on the data shared with us by Foster Farms (Source: Informa Economics IEG Poultry Reference), selling turkeys in parts has the potential to be more profitable than selling whole turkeys. If we take a turkey of average weight, 44 lbs, the selling price based on the value of $0.79/lb would be $34.76. Based on the part distribution in the table, that same 44 lb turkey has breasts weighing 51.69% of 44 lbs, or 22.74 lbs, which could sell for $40.94 (at $1.80/lb). So if the turkey can be parted out for $6.18 or less, Foster Farms could increase their gross turkey sales dollars by selling parts instead of whole bodies. The breasts by themselves are breakeven, and everything else is gravy. Selling all of the parts, the total potential yield of the 44 lb turkey is at least $55.17 (Exhibit 11), more than 50% more than the yield from selling a turkey whole.
There are three main methods of promotion that can be executed under the Harvest Table: cross-promoting, providing more turkey recipes through advertisement and revamping Foster Farms’ Harvest Table’s social media presence, and creating turkey awareness programs.
As a new brand, Harvest Table may struggle with building brand awareness. That’s why the Harvest Table sub-brand will still carry the Foster Farms name to leverage the parent brand’s market standing. In this modern age, customers, Millennials especially, are quick to jump from brand to brand, but studies show that customer retention strategies are 7x more cost-effective than customer acquisition strategies because the customer is already familiar with the product (“Study Finds 70% of Retail and Restaurant Customers Never Make a Return Visit”, 2015). By associating the sub-brand with the parent brand, Foster Farms can push existing customers to Harvest Table and save on costs compared to if Harvest Table attempted to acquire an entirely new customer base.
One of the primary reasons that millennials do not see turkey as an everyday meat is due to the lack of turkey recipes that are delicious and easy to find. Harvest Table can employ an aggressive inbound marketing strategy by delivering daily or weekly content on their website and social media platforms featuring delicious and easy-to-make turkey dishes. To drive traffic throughout the year, Harvest Table can advantage of search engine optimization (SEO) and allocate a portion of its marketing budget every week on social media advertisements.
Butterball’s Instagram page
Another venue for promotion is through the use of social media. Currently, Foster Farms’ Instagram account is predominately chicken related. Harvest Table would create an Instagram account where the content is focused solely on turkey products. This includes providing a variety of recipes and videos of different ways that turkey can be cooked and eaten. By providing sample recipes for side dishes, sauces/gravies/glazes, oven ready turkey products, or holiday leftovers, Harvest Table would be able to keep their customers more engaged.
During the introduction stage, Harvest Table would seek to build product and brand awareness through the acquisition of influencers and/or social media collaborations. This channel would enable partnerships, such as with “Tasty”, Chef Kenji (Exhibit 9), or the Turkey Federation, to broaden Harvest Table’s reach of millennials.
To reinforce the farm-to-table imagery and to stray away from the “processed” brand commonly associated with large conglomerates, all promotional materials, websites, and packaging should include graphics of farms, farmers, and pastured turkeys to emphasize Harvest Table’s position as an authentic and local supplier of fresh turkey.
The sub-brand can involve itself in alternative turkey-related promotions to execute both inbound and targeted outbound marketing. For example, Harvest Table turkey consumption can also be promoted through blogs. Harvest Table can also participate in or lead special events such as Turkey Festival, Turkey Trot, or Turkey Day to promote the brand to the general public in a community setting.
Harvest Table can sell products at current Foster Farms locations of sale, as relationships have already been established with the parent company. Harvest Table can take advantage of existing retail partners to host kick-off events to introduce turkey products under the new sub-brand. One such example would be to push the new sub-brand at Costco, Foster Farms’ biggest distributor, since there is a large customer base already built in. Harvest Table can also utilize other retail stores that are associated with fresh organic products such as Whole Foods and Trader Joe’s, which are frequented by the millennial target customer.
Foster Farms has the most effect on its direct sales footprint on the West Coast, where Foster Farms has the capability to offer its full line of products, from fresh foods to frozen and prepared foods. Given that Harvest Table is a new brand image for Foster Farms, it will take some time to build brand equity. We believe the market pool that Foster Farms can most realistically and strategically serve in the next 2–3 years are urban California cities with highly concentrated Millennial populations. First off, California has the largest population of Millennials in the US with over 9m Millennials (“The Most and Least Millennial Places in America,” 2018). Second, a majority of Foster Farms’ production infrastructure resides in California, resulting in the most cost effective supply chain. California’s Millennial populations are most heavily concentrated in the metropolitan areas (“California Is Home to the Largest Share of Millennials, and They are Active Homebuyers,” 2018).
We recommend a two-year implementation plan that will establishe the Harvest Table brand as a leader in turkey. Within the first year, Harvest Table should be working with both social food influencers with followers based primarily in Northern California to educate them on the uses of turkey and core group of distributors to provide and categorize the Harvest Table product line as a health-conscious alternative to their consumers. This includes the rollout and promotion of an increased variety of turkey-part options and pre-prepared packages, all under the Harvest Table brand. This first year is crucial not only in gaining traction in sales but more importantly, in building out the brand’s promise of providing farm fresh, locally sourced poultry alternatives to their consumers.
If Harvest Table is producing positive results in the first year, the company can begin scaling out distribution to all of their existing Foster Farms geographies, as well as begin their social media campaigns in those same areas. Additionally, as Harvest Table proves to be an in-demand product, Foster Farms/Harvest Table should look to expand its distribution network where Harvest Table has already been established, courting retailers such as Whole Foods and Trader Joe’s, as well as seeking out relationships with restaurant wholesalers. Creating and adding Harvest Table menu options at high-end restaurants would help to build upon the brand awareness and equity of Harvest Table. All of this serves to establish Harvest Table as the farm fresh, and locally sourced option for turkey, and healthy meat in general.
Limitations and Risks
The survey we conducted only captured 171 Californians. Foster Farms could benefit from conducting a more thorough survey to capture a larger sample size and/or include additional questions such as the city or region of California the survey takers reside. Additionally, given that Foster Farms marketing budget for the turkey products is limited, Foster Farms may wish to dedicate its marketing resources appropriately.
One of the risks in implementing our plan is the idea of re-creating a new brand which can stray away from the Foster Farms brand. People will not recognize it and may not buy the product. We also assume that we can acquire social media influencers. Additionally, Foster Farms has deemed their Costco distribution centers as a point of over-reliance, as a large portion of their distribution and revenue is through Costco. If Costco does not take Harvest Table, Foster Farms would then have to resort to second-tier retailers. This would hurt Foster Farms’ sales and brand. Furthermore, Foster Farms’ competitors have already established successful brands that are known for their turkey and have already created well-connected websites for their consumers.
- Emily Kao
- Hailey Nguyen
- Tien Nguyen
- Grace Pai
Connect on Twitter @KennethLNg