12.01.05
Case Study: Fairfield Farm Kitchens (FFK)
Business Description: Fairfield Farm Kitchens (FFK) is a New England-based, privately held manufacturer and marketer of a family of restaurant-quality branded prepared foods.
Theme: FFK is focused on building a line of healthy and tasty products, most of which are organic and produced in a way that supports small, regional growers and helps maintain a sustainable agricultural system.
Background: FFK was founded in 2001 by Norman Cloutier, who also started the company that eventually became United Natural Foods. FFK is best known for producing restaurant-quality frozen and refrigerated organic take-home soups, entrees and bakery products that can be found in supermarkets, natural products stores and foodservice operations, such as colleges, institutions and resorts. The company produces a suite of brands, highlighted by its two core organic lines—Moosewood Soups and Entrees, and Organic Classics Soups, Entrees and Toaster Muffins. These product lines include both vegetarian and meat/poultry-based dishes. The company’s strategy is based on two key tenets: (1) produce wholesome products with restaurant-quality taste for discerning consumers and (2) support family farms and sustainable agricultural efforts. Its commitment to supporting small family farms, and buying ingredients from regional suppliers whenever possible, makes its products foods that people can feel good about consuming. The availability of organic and locally grown ingredients, including meats, has risen sharply, and this has gathered support in the market, as consumers are able to get products that they want without sacrificing quality or taste.
Situation Assessment: The U.S. retail market for natural prepared foods was about $1.1 billion in 2004, with annual growth in excess of 11%; 51% of those products were sold through natural foods outlets, with the balance predominately sold through mainstream grocery outlets. The market is fragmented with the top five brands representing only about one-third of the market. The majority of products in this market are positioned as “meat alternatives” targeting vegetarians. However, only about 6% of U.S. consumers are true vegetarians, while the overall market penetration for organic consumers is thought to be double or triple that figure. Therefore, most consumers are basing their buying decisions on quality and purity, rather than true vegetarian desires. The FFK team recognizes that its business will grow as it continues to bring new consumers into the category. Access to a sustainable supply of organic meats, such as what FFK provides, is fueling growth in the brand and the overall market. FFK’s business is not based on changing eating habits or preferences, but rather on getting consumers to see the benefit in supporting a sustainable agriculture system, while also enjoying meals known for their superior sensory qualities. As part of this effort, it sees great value in exposing consumers to its brand through the foodservice community. This creates a dynamic pull for its brands, since the foodservice accounts expose its offerings to new consumers—eventually driving retailers to stock their products based on increased consumer interest and demand. In the longer-term, it is important to build awareness before consumers have significant buying power, so that they are already “converted” when they become a target consumer.
Opportunities: FFK’s products are positioned to capitalize on two major trends: (1) the U.S. has effectively transitioned to an “on-the-go” society and the number of home-prepared meals is dropping. (2) a growing number of consumers are concerned about the origins of their foods and the resulting impact on the environment. While FFK’s direction is clear, many other brands are working to take advantage of the same trends. Success in this market requires more than adequately targeting demographic factors. It requires excellent products and a sound and well executed marketing plan, both which appear to be in place at FFK.
Lessons Learned: (1) At the heart of FFK’s strategy is having a suite of products that taste great and spur long-term consumer loyalty. The company has witnessed other businesses succeed in executing a commendable operating strategy and zealous support for local growers, but fail in their efforts to create products that consumers desire and are willing to purchase with regularity. (2) Getting consumers to try a product can be handled in more ways than simply handing out free samples. FFK has established an innovative way to get its product out in the market and in front of consumers through foodservice venues and grassroots marketing, such as regional food festivals, community gatherings and local sponsorship initiatives. Both efforts serve a dual purpose of gaining exposure, while also bringing in revenue. (3) The organic market serves more than the vegetarian consumer, and FFK provides products that meet the quality and purity demands of consumers who also eat meat and poultry. Ensuring that products meet a wider variety of food preferences and reward consumers’ palettes with great taste is key to the growth of both FFK’s business and the overall market.